Mr. RAMSEYER. Over how long a period of time--this one year? Mr. DEMPSEY. No; probably it will cover a period of somewhere from 5 to 10 years, judging by the experience in the past.

Now, the leading projects in this bill-and I am enumerating them in the order of their cost-are, first, the Cape Cod Canal; and I want to say just a word about that.

The amount which we recommend to pay for that is $11,500,000. Congress authorized the Secretary to make a contract for the purchase of this canal. Now, it is true that had to be ratified by Congress when it was returned. But at the same time, it was thoroughly understood what was to be done. And where a principal authorizing an agent to do an act and the principal understands thoroughly what the agent is going to do, I quite agree with the President that the principal is placed under a moral obligation which the principal should perform; and in the business world the principal who refused to perform under such conditions would not sustain a very high reputation for probity.

Mr. O'CONNOR. How does that provision get out of the Interstate Commerce Committee and into your committee?

Mr. DEMPSEY. Because it should have gotten there in the first place. It belonged in our committee; and it was not a proper reference, in my judgment, to refer it to the Interstate Commerce Committee at any time. It was before our committee on several other occasions, and has been before the Interstate Commerce Committee only once; and on that occasion it was placed in the Commerce Committee in the Senate, and it came back to our committee. Mr. O'CONNOR. Well, it was placed in the Commerce Committee in the Senate, and then came back to the House?

Mr. DEMPSEY. Yes; but it came back as a Senate rider on our bill. Mr. BURTON. A Senate rider on the rivers and harbors?

Mr. DEMPSEY. Yes.

Mr. BURTON. That was in the last session of the last Congress, was it?

Mr. DEMPSEY. Yes.

Mr. RAMSEYER. On that point that you mention with regard to moral obligation, I want to get this in the record:

In the Sixty-seventh Congress, second session, the proposal submitted by the Boston, Cape Cod & New York Canal Co., paragraph No. 4, is this sentence:

Until Congress ratifies this agreement and title passes to the United States, the company will operate the canal.

Mr. DEMPSEY. However, they were operating it as the agent of the United States under that contract. The United States to pay the interest and the Government to have the receipts.

Mr. RAMSEYER. Well, there is no question about the law. This is all subject to ratification by Congress.

Then, in the statement signed by John W. Weeks, Secretary of War, it ends up in this way: He approves the proposal, subject to the future ratification and appropriation for the purchase thereof by Congress.

Mr. DEMPSY. Yes.

Mr. RAMSEYER. I think it is wholly a matter of the judgment of Congress. I do not see where it is a moral or a legal obligation.

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Mr. DEMPSEY. Well, of course, men can readily differ; but I agree with the President in his annual message to Congress, in which he said it was a moral obligation. I believe he is right. I believe that when we knowingly authorized these men to make that contract, and we knew that they were going to make the contract, and we knew approximately what they would pay, because a jury had found $16,000,000 against us; and there were these additional expenses— I believe there is a moral obligation. And we seized that canal during the war.

Mr. RAMSEYER. And in the law authorizing the Secretary to contract we say it is subject to future ratification and appropriation by Congress. Then again it says:

Acceptance of the award in said proceedings to be subject to future ratification and appropriation by Congress.

Mr. DEMPSEY. Of course, I embodied all of that in my statement. I said that it was subject to that. But I said that when a principal of full age and sound mind, knowing what he was doing, authorizing an agent to do a particular act subject to his approval, and the agent does just what he contemplated he would do, the principal can not very well refuse to ratify that; and in my opinion-it is a matter of opinion, but in my opinion it creates a moral obligation. Mr. BURTON. I do not like to interrupt you, but that amount, whatever it is, that is to be paid for the Cape Cod Canal has to be paid at a very early date, does it not?

Mr. DEMPSEY. No; it is distributed in this way: $6,000,000 of it is in bonds, and we woud assume the payment of those bonds.

Mr. BURTON. Naturally we would pay those bonds off right away, because they are drawing a hight rate of interest?

Mr. DEMPSEY. Probably that is true.

Mr. O'CONNOR. Are you going to use the same argument when they come in with this proposed Mussel Shoals contract, claiming that we ought to ratify it inside of four minutes whenever they bring it in?

Mr. DEMPSEY. I do not want to commit myself on the Mussel Shoals contract at this time. But I think we have proved distinctly in connection with that matter that we are a legislative body, and not an administrative body, when we have taken as long as we have to settle that matter; we have taken years to do it, when an ordinary business man would have had it operating successfully at a profit for some years. That is all I would say with regard to that. Now, to come back to the Cape Cod Canal

Mr. BURTON (interposing). There was a condemnation of the canal, and there was a condemnation suit which resulted in an award of $16,000,000?

Mr. DEMPSEY. Yes; that was awarded by the jury.

Mr. BURTON. Was that rejected by the administrative branch of the Government?

Mr. DEMPSEY. Yes. Of course, in condemnation proceedings, the Government is never bound by an award. But you know it is a pretty universal practice-I never in my experience recollect having seen a case where there was a condemnation award where the party who was seeking the property by that process did not take it-not

one.

Mr. BURTON. I have known of quite a number of instances. But I think the law of my own State, and also of other States, is that the condemnor must pay the attorneys' fees and the cost in case he refuses to accept the award.

Mr. DEMPSEY. Yes. I just want to say this: During the war we seized the Cape Cod Canal and kept it for a long time. We took the revenues from it and put them into the Treasury, and we did not pay for it. The owners of the Cape Cod Canal have not received a cent for its use, and we allowed them to pay all the expenses, such as taxes, during that period. Then in the contract we provided that we should pay the interest upon the purchase price from the time that the contract was made; and all of that interest is cut out of this bill; and it would make the purchase price very much larger if we included that purchase price in the bill.

The next item is the Louisiana and Texas intracoastal waterway; and the amount for that is about $7,000,000.

Very briefly, you will remember that we appropriated about $6,000,000 or $7,000,000 in the last Congress for this same purpose. However, the route adopted at that time is through what is known as the Plaquemine waterway, and it did not go to New Orleans. Now, New Orleans is the commercial center, the accumulating and distributing center of all that part of the South; and you can not properly do any of your business unless you send your route through New Orleans. And $4,000,000 of this amount is for the purpose of deepening the route from New Orleans to Morgan City; and the balance is for carrying the canal from Galveston to Corpus Christi. Mr. BURTON. I beg your pardon. You have already made provision for part of the route from Plaquemine to Galveston?

Mr. DEMPSEY. Yes

Mr. BURTON. And the $4,000,000 is to carry it from Plaquemine? Mr. DEMPSEY. No: from New Orleans.

Mr. BURTON. From New Orleans to Plaquemine?

Mr. DEMPSEY. Yes; to the foot of Plaquemine.

Mr. BURTON. And the cost of that is $4,000,000?

Mr. DEMPSEY. Well, $200,000 of it the cost from Galveston to Corpus Christi.

Now, I will simply say with reference to this:

First, there is a large section along the coast there where the soil is of that nature that it is practically impossible, or it is prohibitive in cost, to build any railroad; and the only service obtainable is a service by water. That is the first thing.

Second, there is no part of the United States which is having a more substantial and a more wonderful growth and development than that part of Texas which this intracoastal canal will serve. To illustrate that, I will say this: That I had the pleasure of spending a morning with Mr. O. P. Sweringen recently. He told me that he had railway experts constantly employed visiting all sections of the United States, studying where the railway development was most needed, and where it would serve the largest amount of traffic: and he said that in all of that investigation he had found that Texas was the most promising field. I do not think you could get a better practical illustration of the fact that this waterway is necessary.

Then I would say in addition that the Pittsburgh people came to us-for instance, Mr. Shepherd of the Jones & Laughlin, one of the largest steel companies in the United States, came to us and said that this was of the highest importance to the steel industry, and that they expected to distribute their products, and that two or three of those large concerns are building as high as 200 or 300 boats apiece, ready to be put into service upon the Ohio River and down the Mississippi and across this waterway.

Now, I am coming next to the items distributed over the Pacific coast, which are really of great importance to the whole country. Mr. GARRETT. Just a moment, Mr. Dempsey: May I ask a question? Mr. DEMPSEY. Yes; certainly.

Mr. GARRETT. It may be out of line with the thought that you are following; but I would like to ask about the deepening of Ġalveston Harbor. Did the committee act upon that?

Mr. DEMPSEY. They acted unfavorably upon that; and the reason was this: They have a depth of 30 feet; and we found in the report itself this statement-which was, I am frank to say, surprising to me, although I was generally acquainted with the facts.

I found that, aside from New York City, the highest percentage of boats with a draft of about 30 feet was 4 per cent of the total number of vessels which visited the harbor. That the next highest per cent was 3 per cent; and in great harbors like Boston, Baltimore, New Orleans, and Philadelphia, the percentages of vessels with a draft exceeding 30 feet ran down as low as eight-tenths of one per cent.

Mr. BURTON. In Boston they have 40 feet.

Mr. DEMPSEY. Yes; in Boston they have 40 feet; in Philadelphia they have 32 feet; in Baltimore they have 35 feet; in Norfolk, 40 feet; in San Francisco, 40 feet. They have 40 feet in New York, and New York was the only place where about 4 per cent of the vessels had a draft exceeding 30 feet.

Now, they have 30 feet in Galveston. And in view of these circumstances, we did not think there was any immediate or urgent necessity for including that in the bill.

Mr. BURTON. May I ask what is the cost of that?

Mr. DEMPSEY. I think about $670,000; something like $600,000. Mr. BURTON. For what depth-35 feet?

Mr. DEMPSEY. From 30 feet to 32 feet.

Mr. BURTON. To increase the depth from 30 to 32 feet would cost $675,000?

Mr. DEMPSEY. Yes; it was either $620,000 or $670,000; it was over $600,000. I will say to you frankly, Senator Burton, that my studies on that question of depth have led me to be very cautious in the matter of giving additional depth.

For instance, we gave additional depth to Newport News; but there was a real reason for doing it; and that is, that they have one of the greatest shipyards in the United States; and they save more in sending the Leviathan down there for repairs on one occasion than the whole cost of this improvement.

Now, there is a controlling reason.

But the Leviathan does not go to any ports except New York; and it goes down to Newport News when it needs to be repaired. So there is a controlling reason.

Now, let me come in a general way to the other questions in the bill, and then to the controversial points.

I think the next most important provision in this bill is for the combination of navigation and power purchases of certain rivers. We provided that the Chief of Engineers should make an investigation and report generally upon this subject, and he has made a report, in which he has grouped all the rivers of the country which are susceptible of development for power purposes; and that it was either proper, in view of all the circumstances, or that it would be advisable, to include all of these rivers; it would cost something like $7,000,000. But we had the Chief of Engineers to let those rivers where he believed the largest powers would be developed, or which were the most promising; and we took one out of each group; and we authorized $500,000 for the investigation of all of these rivers. The Chief of Engineers tell us that he has all that he could economically use in the coming year. I would say that the Cumberland River is one of the rivers included in this list-a list of, I should say, 8 or 10 rivers.

Now, that, in a general way, covers the important projects in the bill.

And we come next to the controversial questions. And I say we could not present any bill to Congress-I have never known of any bill to be presented since I have been here that met, as to all, as to every line and every figure and every letter-met the entire approbation of every Member of Congress.

But I believe that this bill will largely meet and does meet the approbation of the members of the House as any bill can be expected to do.

The two questions in controversy here are, first, the survey of the all-American route; second, the Illinois River.

I am only going to say a word about the survey of the all-American route.

My understanding is that those who advocate the other route recognize these facts: That in our bill providing for this survey a year ago we limited the engineers to the investigation of a 25-foot .depth.

Now, that is sufficient for channel purposes, but it is not sufficient for permanent works. Permanent work should be on a 30-foot depth. They have made no investigation and had no authority to make it, so that it is absolutely necessary that it should be given to them. The amount proposed at first was $250,000. That has been reduced to $100,000, by voluntary action on the part of those who are interested in having the survey made.

We asked General Taylor yesterday the earliest date at which he could be certain to return the survey, telling him we wanted it in as early as possible, and needed to have it in for simultaneous consideration with the St. Lawrence route; and he said that he could not depend on having it in before Congress adjourned; that he could depend on having it ready for the 6th of December, when Congress meets.

We think the provision could properly be included in that way. So that those two amendments were made, and the amount was reduced from $250,000 to $100,000; and provision was made that