immediately established. Their passenger traffic rapidly increased. But
the severe condition of the mail contract, with their quick sailings
allowing only short stays in port, made it impossible for the company to
secure a profitable share of the freight business without a heavy outlay
for slower cargo boats. Within a few months after the start of the line
the Cunard Company had cut freight rates from seven pounds ten shillings
per ton to four pounds. So, while the Collins ships continued steadily
to outsail the Cunarders and got the bulk of the passenger traffic, the
Cunarders got most of the freighting. Moreover, the Collins ships were
far more expensive to run. Indeed, the cost of the rapid service was
enormous. Mr. Collins stated before a committee of Congress that to
save a day or a day and a half in the run between New York and Liverpool
cost the company nearly a million dollars annually.

Accordingly more subsidy was asked for. This was granted in 1852, the
act being stimulated by England's move late in 1851 in raising the
Cunards' subsidy to £173,340 ($843,000), for forty-four trips a year:
about nineteen thousand dollars per voyage. The extra allowance lifted
the Collins subsidy to $853,000 for twenty-six trips a year,
thirty-three thousand dollars per voyage, a rate of upward of five
dollars a mile.[GP]

The competition now became sharper. Still the Collins Line maintained
its record sailings, and continued to beat the English. Then it was
sharply checked by a grave disaster. On the twenty-fourth of September,
1854, the _Arctic_, when forty miles off Cape Race, rushing through a
fog, was rammed by a French steamer, and sunk with three hundred and
seven souls. This calamity had a depressing effect on the company's
affairs. Two years later, in 1856, Congress determined to reduce the
subsidy, and notice of the discontinuance of the extra allowance of 1852