* * * * *

No further move for fostering the American merchant marine with State
aid directly or indirectly, was made till 1864. Then the
steamship-subsidizing policy was revived, first with a proposition for
the establishment of an American mail-line to Brazil. A subsidy of two
hundred and fifty thousand dollars per year was proposed, one hundred
and fifty thousand to be paid by the United States and one hundred
thousand by the Brazilian Government. Congress endorsed the scheme. The
act embodying it (May 28)[HB] authorized the postmaster-general to
contract for a monthly service between the two countries, touching at
St. Thomas, W.I., by first-class American sea-going steamships of not
less than 2000 tons. The steamers were to be built under naval
inspection, and to be subject to taking for war service. Bids were to be
openly advertised for. The contract was to run for ten years. Thus was
established the pioneer American line between Philadelphia and Rio de
Janeiro, which continued from 1865 to 1876, and was then abandoned.

In the same session of Congress a bill was introduced, authorizing an
annual subsidy of five hundred thousand dollars for an ocean
mail-steamship service to Japan and China via Hawaii. This also received
favorable consideration, and was passed February 17, 1865. The service
was to be monthly, performed by American-built ships of not less than
3000 tons, also constructed under naval inspection. Tenders for the
contract were to be advertised for, but bids only from United States
citizens were to be entertained. The contract was to run for ten years.
Only one bidder appeared (as was evidently expected)--the Pacific Mail
Steamship Company. The contract went to that company, and under it, in
1867, their prosperous Asiatic service began. At the outset they were