The Effects of the 1904 North Atlantic Fare War upon migration between Europe and the United States Drew Keeling Department of History University of Zurich Prepared for the All-UC Economic History and All-UC World History joint conference, “Middlemen and Networks” November 3-5, 2006 UC San Diego This paper is a preliminary and incomplete draft. Please do not cite without contacting the author first Comments are welcome at [email protected] An updated and improved edition will be available at the conference, and as a pdf attachment in advance of the conference, to any participant requesting it by October 31. Please use the above e-mail address. The same non-citation stipulation will apply to the updated paper. THE EFFECTS OF THE 1904 NORTH ATLANTIC FARE UPON MIGRATION BETWEEN EUROPE AND THE UNITED STATES C O N T E N T S 1 2 4 5 5 The Historical Context of Transport and Migration Time, Place, Companies, Fares, and Passenger Volumes Roots, Routes and Repeat Transits Kinship Networks and Migrant Self Selection Conclusions and Implications T E X T TAB LE S Table 1 Table 2 Table 3 Table 4 Table 5 Table 6 Regional Sources of Immigration, 1903 and 1904 Expected vs Actual Change in Immigration, 1903 and 1904 Expected vs Actual Change in Steerage Passenger Flows, 1903 and 1904 Steerage Passengers shifting routes, July-Dec., 1904 Other Changes in Steerage Traffic Levels, July-Dec., 1904 Estimated Overall Quantitative Effects of the 1904 Fare War on Migration REFERENCES Primary and Reference Book Sources Passenger list sample Secondary Sources A P P E N D I C E S #1 #2 #3 #4 #5 #6 #7 Recessions, U.S. Immigration and North Atlantic Fare Wars, 1870-1914 Cunard Line, Liverpool-New York, Fares and Passengers, 1885-1914 Westbound Steerage Passengers and Weighted Average Fares, 1901-1913 Quarterly Steerage Fares to New York, 1903-06 Immigrant Passengers' Nationalities and Embarkation Ports, 1903-04 Steerage Flows, West and East, between UK and USA, 1900-04 Westbound Crossings by Migrant Type, 1900-14 and second half of 1904 1. THE HISTORICAL CONTEXT OF TRANSNATIONAL INTERMEDIATION, LONG DISTANCE TRANSPORT, AND MODERN MASS MIGRATION One of the biggest aspects of European overseas expansion in the modern era was the large and voluntary long-distance relocation of Europeans abroad. This mass migration reached a culminating peak in the early years of the twentieth century when over twenty million people left Europe for other continents, about half of them bound for the United States.1 A range of “middlemen,” from colonization companies to promoters, contractors, and agents, and the more informal but almost ubiquitous kinship-based "chain migration" networks, have historically accompanied every episode of mass European relocation overseas. How the costs imposed upon migrants by these intermediaries might have shaped the volume and character of European mass emigration across the half-century ending with the outbreak of World War I, has remained obscure however. The lack of any significant sustained trend (down or up) in transatlantic steamship fares during these decades limits the conceivable significance of transport costs upon mass movements between the labor markets of Europe and North America.2 Migration historians have nonetheless periodically voiced suspicions that transportation might have been a "third factor" in between the stereotypical "push" and "pull" causes of migration, or that fare wars between shipping companies "determined the extent and character" of the migration "in certain years."3 The best-documented fare war of the steamship era on the North Atlantic took place on routes between the British Isles and the United States during the second half of 19044 . A careful 1 U.S. Historical Statistics, Willcox 2 See, for example, appendices 2 and 3. 3 Hvidt, “Agents,” p. 179, Hansen, “Immigration as a Field for Historical Research”, p.194. 4 The initial targeted trimming of fares on the first ports affected by the fare war occurred in April,1904 and final restoration to pre-fare-war levels on all routes came only in March, 1905, but the six month period from July to December of 1904 - when cut rates were in full and open effect for steerage (third class) passenger travel from all British and Scandinavian ports to United States - is the operative period of the fare war used in this paper. analysis of the available sources on shipping lines’ corporate strategy makes it clear that the fareslashing (to as low as one-third of normal levels) during this half year was not done in order to try to influence either the volume or the socio-economic composition of the migration occurring at those bargain travel prices. It is an open historiographical question, however, whether cut-rate passage prices might have inadvertently had such effects, and this episode provides an illustrative case by which to consider, more generally, the role of travel costs and migration intermediaries on mass migration between Europe and America. Of all European countries in the opening decade of the twentieth century, the United Kingdom had the oldest and most-developed maritime infrastructure, the most technically advanced ships with the most comfortable (or least uncomfortable) on-board accommodations, plying the shortest routes to America. Its relatively literate island population had ready access to major transatlantic ports, and a longer experience with mass migration to North America than any other. Britain was also unique in being both a sizable source of overseas emigrants and a major transit corridor for third country nationals (particularly from Scandinavian and Russia) who often found it convenient to migrate to America by way of British embarkation ports. The 1904 fare war differed from its predecessors in the 1870s, ‘80s and ‘90s, because it came towards the end (not in the middle) of a relatively minor (not major) recessionary slump in the United States, and it was accompanied by an increase, not a decrease, in steerage passenger traffic along the effected routes. The more typical pattern of the preceeding thirty years had been one in which temporarily slashed fares were associated with declines in the number of transatlantic migrants journeying to the USA. Immigrant employees, then and now, were heavily over-represented in marginal jobs and in cyclical industries. Their job prospects were thus doubly cyclical, and migrant flows to America tracked the ups and downs of the U.S. economy and labor market with magnified amplitude. Because nearly all the costs of transporting those migrants across the Atlantic were “fixed” (in the sense of not moving with changes in revenues), the effects of cyclical downturns upon the profits of passenger shipping companies were magnified still further.5 Not surprisingly, “fare wars” tended to break out during recessions, when the transport firms faced heavy losses and competed more desperately than usual for shares of a much-reduced migrant traffic. The belief that steamship fares stimulated relocation across the late nineteenth century North Atlantic thus mistakenly inverts both the “sign” and the “direction” of historical causation. Instead of migration rising because fares fell, fares more often tended to fall in response to plunges in migration volumes. The 1904 fare war did not fit this pattern, however, and this paper addresses the reasons for that “exception to the rule.” The dramatic slashing of transatlantic steerage fares on the principal transatlantic routes connecting the United States and the United Kingdom, in June 1904, generated newspaper headlines across the Atlantic basin. It was a culminating episode in a long-standing rivalry and collusion between major British, German, and American passenger shipping corporations, and it occurred as politicians and pundits in the United States were gearing up for the most heated and prolonged immigration policy debate of the decade and half preceeding the First World War. Early in the 1904 “fare war,” American immigration officials expressed concern that the cheap rates were attracting “people of the lowest class” and that ports of entry would soon be “swarming with all the riff-raff” of Europe. More complacent voices, however, considered the “fear” of a “large influx” of “a loathsome mass of poverty, filth and disease” to be “greatly exaggerated”.6 Embedded within the allegations of a decrease in migrant quality were assumptions of an increase in migration quantity. The anti-immigration “restrictionists” of the early 1900s in the United States voiced the historically oft-heared complaint that contemporary immigrants, on the whole, lacked the 5 Keeling, “Costs” 6 New York Times, June 13, 1904, p.17, Liverpool Weekly Mercury, June 18, 1904, p. 19, The Nation, June 16, 1904, pp. 465-66. praiseworthy traits found in their more nostalgically remembered predecessors of prior eras. When it came to the more specific issue of the “transportation interests” competing by means of drastic fare reductions, however, the claim was not that the companies were deliberately engineering a substitution of “desirable” by “undesirable” immigrants, but rather that, by lowering the cost barriers to transoceanic movement, the passenger shipping industry was enabling new, additional, and less welcome classes of newcomers to reach America who could not previously afford it. The central contention, in other words, was that a lowered price of reaching America during this fare war (and by vague and mostly incorrect inference, fare wars in general) was producing a higher volume of Europeans resettling in the United States. This hypothesis has found its way into the historical literature of the period without being properly addressed or convincingly resolved there. The objective here is to use a comprehensive array of statistical measurements to identify and explain the key quantitative effects of unusually low transatlantic ticket prices during the second half of 1904 upon migration across the North Atlantic. There are two basic steps to the analysis which follows here. The first step is to measure as accurately as possible the change (increase) in the flow of migrants along the routes impacted by the 1904 fare reductions, during the period of time when the very low rates were in effect. This measure needs to also be adjusted for factors (other than the low fares) affecting migration along those routes during that time. The calculation amounts to deriving the difference between the actual flows of migrants and the flows which would have been “expected” had there been no fare war, but with all other factors unchanged. The result is thus an estimate of the changes in migration during the fare war, and because of the fare war. The second step is to break down this measure of changed migration flows according to the likely reasons for the changes. One key distinction to try to gauge at this stage, for example, is between migrants deciding to cross the Atlantic because of the low fares, in contrast to those already-committed migrants who simply altered their routes in order to embark at ports where rates to the United States had been slashed. The resulting quantitative estimates of the reasons for increased or otherwise changed migration flows can then be interpreted in the light of more general historical knowledge about the motives and patterns of the European migrants who came to America on steamships. Before proceeding with the analysis, however, it is first necessary to describe more fully the sources and methods that will be followed. Two key components of the approach here are the combining of traditional U.S. immigration statistics with passenger and fare date available from shipping line archives, and the augmenting of these aggregate measurements with data from a sample of detailed passenger arrival lists prepared by shipping officials and given to U.S. immigration inspectors. 2. Time, place, companies, fares, and passengers The fare war of 1904 and early 1905 is an important and not very well understood episode in the history of the North Atlantic passage, often mentioned by migration and shipping historians but rarely examined in depth.7 In the secondary historical sources treating the fare war tangentially or superficially, there are contradictory indications as to when and where it occurred, and who, amongst the transport firms involved, was allied against whom.8 A careful and 7 A classic account of the 1904 fare war’s origins, trajectory, and outcomes, can be found in Murken, chapters 8-15, particularly chapter 12. Murken was the chief negotiating lawyer for the German HAPAG line, a key protagonist in the fare war, and his elegantly lengthy German prose is interrupted by few footnote citations. The concise yet incisive account by Vale provides further details, better citations, and a different perspective on the war’s antecedents. More concerning the motives and tactics of the various shipping lines involved, and the outcomes and “lessons” learned afterwards, particularly in the U.S, can also be found in Keeling, “Business,” in the relevant portions of chapters 3-5. 8 There are two principal misunderstandings in the secondary literature of the fare war. Firstly, because the formation of J. P. Morgan’s “Anglo-American shipping trust” during 1900-03, which paved the way for the fare war, involved a long and complicated set of negotiations between Morgan and his eventual British affiliates, on the one side, and the two giant German lines, on the other, there have been occasional assumptions that these two blocs were the ones fighting the fare war. In fact, both were allied against a third force, the fiercely independent Cunard Line underwritten by a generous and timely British government subsidy. The second set of confusions arises from the fact that a key precipitating cause of the fare war was the determination of the German lines to force, via their Morgan “combine” allies in the UK, punishingly steep fare cuts upon the Cunard line, in order to pressure it to rejoin the cartel thorough examination of the primary sources, such as contemporary newspaper accounts,9 make it clear however that drastically reduced fares and “cutthroat competition” occurred essentially on the routes from UK and Scandinavian ports to the United States10 from late Spring, 1904 to early 1905, and that the principal antagonists were the group of British lines led by the U.K.’s White Star11 acting largely as proxies for their two large German allies, HAPAG, and NDL, versus the British owned-and-operated Cunard company.12 The focus of this paper is on the relatively narrow but important issues of whether, how, and how much the 1904 fare war affected fundamental decisions of European migrants to cross the Atlantic to (and in some cases, also back from) the United States. The proper way to begin the analysis is by examining the passenger fares in the steerage class used by over 80% of transatlantic migrants between Europe and America in the early 1900s. Detecting periods of (“conference”) arrangement it had abruptly dropped out of in 1903. The shipping line “conference” system, largely set up to allocate market shares of steerage (migrant) passenger traffic, survived in a weakened form, but was only fully restored in 1908 when Cunard finally came solidly back into the (strengthened) collaborative fold on a lasting basis.Some observers and historians have therefore assumed that the fare war itself lasted from 1903-08, when in fact rock bottom steerage fares (half or less of the normal pre-war level averaging about $25 from the UK to the USA) occurred only from mid 1904 through early 1905. See Keeling, “Business,” pp. 125-27. 9 Wall Street Journal, June 2,1904, p. 5, New York Times, June 10, 1904, Liverpool Weekly Mercury, June 11, 1904, p. 4, Frankfurter Zeitung, September 16, 1904 (I), p. 2, p. 6, Times (London), January 16, 1905, p. 6. See immediately following paragraphs for corroborating fare measurements. 10 The smaller UK-Canada traffic was not noticeably affected, possibly because fares there also were reduced, at least to some extent. See Murken, chapter 11, and Times (London), January 16, 1905, p. 6. 11 the so-called “International Mercantile Marine [IMM],” set up by financier John Pierpont Morgan (see the footnote two before this one) and consisting, at least for steerage passenger segment, of the essentially British-run and US-owned White Star, Red Star, and American lines. The formation of IMM is described concisely in Sears, and is also covered in leading biographies of J.P. Morgan, e.g. Chernow. 12 These four companies, White Star, Cunard, HAPAG and NDL were the four largest carriers of migrants to America in the early 20th century, handling on average two thirds of the total Europe-US migrant traffic. About two thirds of the relatively small number of Scandinavian migrants to the USA in these years travelled by way of UK ports. See Keeling, “Business.” The fare cuts on the UK-US routes were thus closely matched in magnitude (and for reasons not important here, slightly preceeded in time) by reductions affecting the one third of Scandinavians going directly from “home” ports in Copenhagen, Gothenburg, and Kristiania (Oslo). Passage fares on other routes between Europe and the USA were also affected to a varying but overall much lesser extent. The fare trends are shown in Appendices 2-4, especially appendix 4, below. sustained very low fares, e.g. fares sustained at less than half of their 1900-13 level for at least three months at a time, allows identification of the time, place, and companies involved in fare wars.13 The fares charged to Europe migrants crossing the Atlantic by ship to U.S. entry points (such as New York’s Castle Garden, or its successor, Ellis Island, which handled over two-thirds of that massive influx in the nineteenth and early twentieth centuries) have been a source of frustration and confusion to historians. The fares were only publicized on an infrequent and intermittent basis, the rates changed abruptly at odd intervals, and until recently, there have been very few continuous time series discovered or developed. Historians have tended to try to draw trends from only a few scattered observations, usually without convincing effect, or to ignore the fares altogether, or to say how important they must have been, somehow, without really knowing how or why they changed over time, or what the real net effect of such changes might have been on migratory decisions, behavior, or outcomes. Three basic time series of North Atlantic steerage fares are presented here in appendices 2,3, and 4. The first two comprise annual average fares and are included mainly for the purpose of illustrating, firstly, the lack of any sustained secular trend14 and, secondly, the tendency of changes in steerage fares to be positively rather than inversely correlated with changes in passenger volumes, most of the time. The quarterly data shown in Appendix 4 confirm the newspaper accounts of when and where the fare war was concentrated. The Cunard line, the main target of the fare cutting, forced to match the low rates of its direct UK competitors, and a good proxy for measuring trends of overall fare levels from the U.K., cut its steerage prices sharply in late June of 1904 and did not fully restore them until March, 1905. Fares out of the fare war’s “secondary theatre,” 13 The general existence of a “fare war” itself, e.g. the 1904 fare war, is evidenced by press coverage of the aggressive competition between transport lines by successive rounds of price-cutting. 14 A slight upwards drift across the thirty years from 1885 to 1914 is roughly in line with the generally rising trend of U.S. wages (the principal ultimate source for financing most migrant crossings in this period). See Keeling, “Capacity.” Scandinavia, moved in a very similar pattern, albeit about two and a half months earlier (up and down). Prices of the third company shown in Appendix 2, the Holland America line, followed a similar trend, but the drop in rates is much less. The continental lines such as Holland America and the two large German companies made substantial fare cuts only on a selective basis -e.g. for the minority of passengers from Russia and Austria Hungary who had viable ways of going to America via Britain or on vessels of a British shipping company.15 After fares, the next most important “timing” factor is the U.S. business cycle. Migration levels fluctuated as much as a factor of 4 in response to changes in the U.S. economy. There is general agreement16 that the U.S. economy was in a mild recession from about October of 1903 through September of 1904. The best estimates17 indicate that migration decisions lagged changes in economic output and job supply in the USA by about three months. That makes the operative period of the recession, for migration flow purpose, calendar 1904 (January-December) Allowing for a lag of at least a month or so for migrants to respond to cut-rate fares, even with the considerable “advance notice” that applied in this case, and even for minor aspects such as the choice of shipping line or embarkation port, the appropriate time period for measuring the affect of the fare war on migration moves would begin in July,1904. It could theoretically then run into the Spring of 1905, except that fares on some routes (see Appendix 4) had already returned to “normal” by January, and there is clear evidence of the U.S. economic upswing starting in the fourth quarter of 1904 impacting -with the expected three month lag- the in the monthly migration numbers starting in January, 1905. The basis for estimating the effects of the fare on migration is thus to compare the actual migration flows from July through December of 1904, on the most affected routes (see Table 1) 15 The obscure and complex details of such circumlocutions described informatively though incompletely in Murken are not material to the basic conclusion here that the fare war mainly affected North Atlantic transit fares out of the UK and Scandinavia, with only a mild overall “echo” in other Europe ports. 16 in Jerome, pp. 100-02, Bratt, p. 245, and Miron and Romer, p. 336. 17 see Jerome, pp. 87-88, 91-93, and 121. with the expected flow levels. The latter estimate, shown in Table 2, is made by taking the actual levels of the second half of 1903 and adjusting them for the effects of the last six months of 1903 being in a non-recession period, whereas the last six months of 1904 to which 1903 is to be compared, were all recession months. The effects of the fare war are thus to be estimated by comparing the change (increase) in migration flows in the second half of 1904 over 1903, with an adjustment for the expected drop due to a mild recession being in effect during the latter period. But the fare war affected more than just immigrants from the immigrants from UK and Scandinavia compared in Table 2. Appendix 5 shows how, in essence, some migrants from countries outside Britain and Scandinavia travelled through Britain rather than through their own “home” embarkation ports. By tallying the change in the levels of all steerage passengers, not just UK and Scandinavian migrants, in Table 3, a rise in these transit migrants is revealed (see Table 4 described in the next section below. Not all of the difference excess of steerage passengers from the UK over British migrants to the US comes from these transit migrants, but most does ). As an convenient simplification, it is assumed that the one other major external factor impinging on migration during the fare period, the political conditions in Russia18 exactly offset the expected drop in these “non-immigrant” steerage passengers. Summing up then, the methodology here is to take the computed excess of actual steerage class passengers from UK and Scandinavian ports from July to December 1904 over the expected level of those passengers (the 1903 actual volume with a small net adjustment for the business cycle effects, all other extraneous factors, are assumed to cancel each other out). The increase, shown in Table 3, comes to about 61 thousand passengers, or 74% over the “expected” level. This is the estimated of the increase migration due to the fare war. It remains to estimate the relative proportions of this increase attributable to the various likely reasons for the increase. 18 In Russia during late 1904 there was both an unpopular war (with Japan) an unpopular government (leading to the Revolution of 1905) and a period of higher than “normal” pogrom violence against and general oppression of Russian (mostly) Jews. Table 1 Regional Sources of Immigration 1903 and 1904 Country / Region of last permanent residence share of Immigration from Europe full year 1903 2nd half of 2nd half of 1903 1904 2nd half of 1904 versus 2nd half of 1903 United Kingdom Scandinanvia 12% 8% 44,888 30,403 82,183 26,258 37,295 -4,145 +83% -14% UK & Scandinavia 20% 75,291 108,441 33,150 +44% Europe other than UK & Scandinavia 80% 307,539 264,520 -43,019 -14% 27% 18% 21% 6% 9% 101,900 68,719 80,640 25,737 30,543 89,377 86,191 43,249 24,926 20,777 -12,523 17,472 -37,391 -811 -9,766 -12% +25% -46% -3% -32% 382,830 372,961 372,961 -3% of which Austria Hungary Russian Empire Italy Germany All Others TOTAL EUROPE Source: U.S. Bureau of Statistics data Table 2 Expected versus Actual Change in Immigration from UK and Scandinavia (July-Dec. 1904 versus July-Dec. 1903) ACTUAL Immigration from UK & Scandinavia in 1903 Immigration from Europe other than UK & Scandinavia 2nd half of 2nd half of 1904 2nd half of 1904 versus 2nd half of 1903 Source or Calculation 1903 75,291 108,441 33,150 44% from Table 1 307,539 264,520 -43,019 -14% from Table 1 -6,534 -9% EXPECTED comparable change in Immigration from UK & Scandinavia ( see Note below ) EXCESS of Actual over Expected Immigration from UK & Scandinavia in 1904 ( 33,105 - ( - 6, 534 ) ) 39,684 ( 33,105 - ( - 6, 534 ) ) Expected comparable change in UK+Scan Europe ex UK Scan, Calendar 1908 vs Calendar 1907: -75% UK, Scan, Calendar 1908 vs Calendar 1907: -47% 62% Table 3 Expected versus Actual Change in Steerage Passengers from UK and Scandinavia (July-Dec. 1904 versus July-Dec. 1903) Change Amount Source or Calculation Actual Passengers, July - Dec. 1903: 83,189 Transatlantic Passenger Conferences Reports Actual Passengers, July - Dec. 1904: 144,562 Transatlantic Passenger Conferences Reports July-Dec04 less July-Dec03: 61,373 Net Expected Increase: (see below) 0 74% EXCESS of Actual Change in Steerage Passengers from UK and Scandinavia (1904 versus 1903): 61,373 ( 61,373 - 0 ) of which the EXCESS of Actual over expected change in Immigrants last resident in UK & Scan.: 39,684 from Table 2 of which the EXCESS of Actual over expected change in Steerage Passengers who were NOT Immigrants last resident in UK & Scan.: 21,689 ( 61,373 - 39,684 ) Sources: Note: TABLE 4 STEERAGE PASSENGERS ('000s) SHIFTING FROM OTHER ROUTES TO UK-USA DURING JULY-DEC., 1904 Part A: IMMIGRANTS to USA, officially listed as "last resident in the UK" but of Continental "races" (other than "Hebrews") in fiscal 1905 less fiscal 1904 German Polish Lithuanian 1.00 .45 .35 Russian Other .15 .65 Subtotal: 2.60 Part B: ESTIMATED IMMIGRANTS to USA, officially listed as "last resident" in the UK but NOT of British or Irish "race" (here including "Hebrews") shifting to UK-USA from other routes [1] [2] 14 6 Total "Hebrew" residents of UK among fiscal 1905 immigrants "Hebrew" residents of Great Britain " " " " IF they were at the same percentage of all Immigrants as during 1906-14 [3] = [2] - [1] 8 Difference [4] 3 Other Continental European races resident in Great Britian 1905 less 1904 (from Part A above) [5] = [3] + [4] 11 Total "UK,Scan Immigrant" Route shifts Part C: ESTIMATE of STEERAGE PASSENGERS to the USA who were NOT officially listed as "last resident in the UK," and shifting to UK-USA from other routes 19 Total Other Steerager route shifts ESTIMATED TOTAL STEERAGE PASSENGERS SHIFTING FROM OTHER ROUTES: 30 SOURCES & NOTES: Parts A and B: BI Annual Reports, Table V, Part C Part C: Unexpected Increase in Steerage Passengers (who were not UK or Scan Immigrants) on UK-US routes during July-Dec., 1904 of 21,689 less estimated 2,500 increase (see table 5 below) in migrants who were naturalized U.S. citizens returning from short visits to families in Europe TABLE 5 OTHER CHANGES IN STEERAGE TRAFFIC FROM UK & SCAND. Westbound III Class A. HIGHER LATE SUMMER REPEAT RATE 18% Passengers % of Total Actual less Projected as % of Total Increase in Passengers Late Summer repeat rate (above) times increase in Sept. and Oct. III class westbd Sources: Passenger lists 60 11 of which citizens 3 Note: All the "summer repeat" passengers went west in September or October of 1904 and were recorded as having been previously in America, and in1904. 77% of steerage eastbound to UK and Scandinavia, January-August, 1904, occurred during May-August. B. TIMING SHIFT going to America during July-Dec ‘04 instead of in Apr-Je1905 [1] [2] [3] = [1] x [2] [4] [5] = [4] - [3] 331,027 All westbound III during April-June, 1905 19% UK as % of all, April-June,1900-11: 62,513 "Expected" UK III westbound 60,778 Actual UK III westbound 1,735 Actual minus expected = estimated shift from 2nd calendar quarter of 1905 to Fall '04: 1.7 = estimated shift from other future quarters to Fall '04: 2.3 4 NET = Comment: This measures the quantity of migrants whose timing shifted from April-June, 1905 to January-March, 1905 (i.e those who left earlier than they otherwise would have within the 1905 fiscal year in order to take advantage of the very low fares during the fare war). Source: Voyage Database Note: The "UK as % of All (row [2] above) excludes the atypical calender quarters 1904-II trhrough 1905-I and 1908-I-IV See chart C-F1 C. INCREASES IN FIRST TIME IMMIGRATION Relocations to America by steerage from UK & Scandinavian embarkation ports made as a result of the low passage costs during the “fare war” FIRST TIME MIGRANTS: See Table 6 below’ 15 TABLE 6: INCREASED STEERAGE TRAFFIC FROM UK & SCANDINAVIA (in '000s) AND ESTIMATED REASONS INCREASE IN STEERAGE PASSENGERS ATTRIBUTABLE TO THE FARE WAR: 61 Table 3 CHANGED ROUTES: 30 Table 4 49% INCREASED REPEAT MIGRATION: 11 Table 5 18% ACCELERATED TIMING OF MOVES: 4 Table 5 7% 16 Table 5 27% 10 6 see below 16% 10% accounted for by ADDITIONAL FIRST TIME CROSSINGS MADE BY IMMIGRANTS TO USA LAST RESIDENT IN UK OR SCAN.: First time crossers further subdivided into "INDEPENDENT": "DEPENDENT": see below Definitions (see Keeling, “Capacity” Appendix 16) “Dependent Migratory Crossing”: one in which the relocation decision was essentially made by someone else (usually a sponsoring or accompanying close relative) “Independent Migratory Crossing”: all other first time crossings by European migrants to the USA Breakdown of first-time migrants between independent and dependent migrants as a percentage of the increased crossings due to the fare war From Passenger list sample: Independent: Dependent: Applied here: 61% 39% 16% 10% 3. Roots, Routes, and Repeat Transits Most Scandinavian migrants to the USA travelled by way of Britain, but their “third country” transit through Britain cannot explain steerage passengers from both Britain and Scandinavian ports being higher than the level of migrants to America who were citizens or long term residents of the United Kingdom or one of the Scandinavian countries (shown in Appendix 5). Nor can it explain the rise in this difference during the fare war. Two factors can explain it however, and their magnitude is estimated in Table 4. The main reason for the difference is immigrants over other nationalities travelling to UK ports and continuing from there as steerage passengers to the US. This effect is captured in Part C of Table 4, after making a small adjustment for another source of discrepancy: naturalized U.S. citizens returning to America after short visits, using the cheap fares, to their home villages. Quite a number of these show up in the passenger lists of the period. They have names like Olsen travelling with a number nonU.S.-citizen immigrant Olsen from a small village in Norway in the steerage. They classified as here migrants despite their nationality because the purpose of their travel was clearly related to migration, not to crossing the Atlantic to make a grand summer vacation tour of Europe as was case for most U.S. citizens in the first class. In addition, Parts A and B of Table 4 also show and estimate the magnitude of UK immigrants who appear to have been actually only temporary residents staying a few weeks enroute from Poland, Hungary, or the Jewish “Pale of Settlement.” There is separate evidence of such misclassifications, and no other good explanation for the sudden surge (in the U.S. immigration statistics) of “Hebrew residents of Great Britain” immigrating to America in late 1904 and early 1905. The great likelihood, and the assumption of Table 4, is that these were actually Eastern European residents taking a little extra time (for various reasons) to get through Britain to America. Table 4 thus adds together two measures to arrive at the amount of the additional fare war induced migration which is attributable to migrants from continental Europe going via Britain in larger than usual volumes to take advantage of the low fares. The first measure computed in Part C, is basically the excess of (a) actual steerage passengers less immigrants versus (b) what that excess could be expected to be, absent the fare war. The second measure, Parts A and B involves the same effect, but with transit migrants classified (e.g. by virtue of a weeks with a temporary UK address) as residents of Britain. 1 Table 5 goes on to estimate two further reasons for increased passenger flow during the fare war. The first reason is also suggested by a look at steerage eastward flows to Europe during the fare war, shown in Appendix 6B. Monthly shipping figures reveal a big surge in July, 1904 shortly after the fares were slashed, of steeragers going from America to UK and Scandinavian ports. Passenger list samples, which show big increases(in 1904 versus 1903) immigrants who had been in America already the same year (1904) particularly in September, confirm that there was increase above the normal “expected” level of short term summer visits to Britain and Scandinavia made by migrants already resident in America. They took advantage of the low fares to go back to their home villages in Europe and in some cases, to bring over additional relatives to America on their return westward crossing later in the summer. A second effect, estimated in Part B of Table 5, is that of migrants deciding to go sooner to the US(e.g. during the Fall of 1904 and at very low fares) rather than later (e.g. the following Spring). These three reasons - migrants changing of route, migrants already in the USA making extra short term roundtrip excursions back to Europe, and European already intending to migrate to America doing so sooner than planned due to the bargain ticket prices- account for most of the 61 thousand increase in steerage passenger crossings during the fare war. The remaining unaccounted for increase, shown in Table 5, part 2, is thus assumed to be Europeans not intending a move to the USA who made up their minds to make such a move because the fares were so cheap. 1 Another possible route shift, that of British migrants to America going directly their rather than via Canada, appears, based on both shipping and migration sources, not to have occurred to any meaningful extent. Table 6 summarizes the estimated magnitudes of these various reasons for migration to increase as result of unusually low fares. Appendix 7 shows the same results in pie chart form. 4. Kinship Networks and Migrant Self Selection This section is not done yet. There are two key points it will make. 1. It will reiterate that the main impact of the 1904 fare was on how (routes), how often (repeat migration) and when (timing) to go to the USA not whether to go there rather than to stay in Europe (or, in a negligible handful of instances rather than going to some other overseas destination) in the first place. 2. It will explain why these effects (changed routes, increased circularity, accelerated timing, and decisions to relocate in the first place) were bigger in the 1904 fare war than in prior fare wars. Four main reasons a) potential for route switching increased (massive Russian emigration only getting started in 1880s in 90s) b) increased propensity for summer visit repeat migration c) milder recession in 1904 than during prior recession plus fare war periods d) lower overall effective costs of relocation (mainly higher wages and faster on land transit times) made the steamship ticket a relatively more important component of that cost than before. 5. CONCLUSIONS AND IMPLICATIONS The fare war was a dramatic and significant episode in the business of transatlantic migration.2 It had rather less powerful impacts upon the decisions made by migrants and the outcomes of those decisions.3 Westward steerage passages from the affected ports in the British Isles and Scandinavia nearly doubled, but the estimates here suggest that only about a quarter of the increased traffic was made up of Europeans deciding to migrate to the United States because of the lower fares. Overall, by contrast, roughly four out five European migrant transits to America, on average during 1900-1914, were comprised of such “first time crossers.”4 It is instructive to speculate briefly on what might have happened with migration had the low fares been sustained somehow. (This presupposes some rather drastic changes in the ownership, regulatory or subsidy structure of passenger shipping, since the prevailing 1904 fare 2 Both sides were ultimately able to claim victory. The German lines eventually did get Cunard to rejoin the conference (cartel) system which they led, and Cunard was able to largely dictate the terms of that reentry. These victories came at the questionable price of a year or more’s worth of net profit being (See Keeling, “Business”, chapter 4) 3 Against the benefit of the reduced fares for migrants, which amounted to about 1-2 weeks average earnings in America (per crossing), must be set the inconvenience of sometimes chaotic and overcrowded conditions on the docks and on the ships, especially during the peak westbound weeks in September. 4 See Appendix 7 below. war level of steerage $10-15 was well below breakeven for the companies as actually configured). Does this episode, in other words, offer evidence for passage prices being a major operative constraint on the volume and characteristics of those self-selecting to relocated to the USA? For the six month period when the fare war was fully raging, the basic sensitivity of decisions to leave Europe in response to changed to fare levels indicates that a 50% drop in fares produced a roughly 25% increase in decisions to migrate (given that the overall passenger increase was just below 100% of the pre-fare-war base period). It is theoretically possible that these low fares if indefinitely sustained might have led to an ultimately greater than 25% increase in migration, due to the replicative effects of “chain migration,” the growing tendency for “circular” repeat crossings and so forth. The basic economics of migrate-versus-don’t-migrate decisions in this period argue against such a conjecture, however. At average wages, living costs, and employment rate levels in America, the typical migrant could expect to save about $4 per week there. Fares reduced by about $12 would thus reduce the time to “breakeven” on migration costs by less than one month. At the margin, there were clearly Europeans on the brink of deciding to go off to America, and for whom such an additional gain would tip the balance in favor of emigration. That seems to be basically what happened with many of the 25% of new transatlantic relocaters from the UK in the second half of 1904. The supply of such “fence-sitters” was also surely not exhausted by a mere six months of available cut-rate fares. But, the supply was surely also finite, however. The overall preponderance of evidence indicates that the great majority of migrants to the United States, decided to do so on the basis of a time horizon of at least a year or two, and usually with family connections enabling a much longer and more often that not permanent resettlement. Given the existence of transatlantic migration networks stretching into many thousands of European villages, and the proliferation of well-established mechanisms for intra-family financing, such as prepaid tickets and remittances from America, it is certainly seems unlikely that great numbers of potential migrants would have leaped at the chance to move overseas because of being able to do by to borrow against one month less of expected future savings. The conclusion that the fare war of 1904 had relatively modest (and probably not sustainable) effects on decisions to migrate, is less surprising than it may at first seem. No one could get to the United States in 1904 from Europe without spending a week at least crossing the often seasickening Atlantic in a coal-powered metal boat. But half a century after the introduction of regularly scheduled budget class transatlantic travel, the existence of uncomfortable but reliable and relatively affordable transportation to and from North America was largely taken for granted. Permanent or temporary innovations in amenities and or in price of the service could have big effects on the routing, timing or circularity of migration between Europe and the United States, but not whether or not to take the plunge and move overseas. Ultimately, the 1904 fare war turns out to be something of an exception-which-proves-the rule. During this era of open borders, generally “unfettered” labor markets, and mostly peaceful globalization” across the North Atlantic, access or lack of access to flexible, risk-ameliorating kinship networks was a more significant operative constraint on mass international migration than the costs of relocation The most crucial middlemen intermediaries were those provided by “in-house” networks, not supplied by the external “market.” BIBLIOGRAPHY (partial) PRIMARY AND REFERENCE SOURCES Anchor Line, annual reports, archives, Business History Centre Archives, University of Glasgow, U.K. Bonsor, N. R. North Atlantic Seaway: An illustrated history of the passenger services linking the old world with the new. 5 vols. Newton Abbot: David & Charles, 1975–1980. Bratt, Elmer Clark. Business Cycles and Forecasting (2nd edition). Homewood, Il.: Richard D. Irwin 1961. Cunard Annual Reports, 1885-1914 (Cunard Archives, University of Liverpool, Liverpool, U.K.) Cunard Voyage Accounts, 1885-1914 (Cunard Archives, University of Liverpool, Liverpool, U.K., AC 12/1-6) De Boer, M. G.. The Holland-America Line, 1873-1923. Amsterdam: L. Van Leer, 1923. HAPAG, annual reports, Staatsarchiv, Hamburg, Germany. Historical Statistics of the U.S., 1975. [U.S. Historical Statistics] Holland America Line, annual reports (Gemeentearchief, Rotterdam), 1899-1914. Holland America Line, Passagegelden (Gemeentearchief, Rotterdam), 1900-1914. [Passagegelden] Hourwich, Isaac A. Immigration and Labor: The Economic Aspects of European Immigration to the United States. New York: Putnam, 1912. “How Much is That”? (eh.net/hmit/compare/ ) Liverpool Daily Mercury, 1900-04. Miron, Jeffrey A., and Christina D. Romer. "A New Monthly Index of Industrial Production, 1884-1940.” Journal of Economic History 50 (June, 1990), pp. 321-37. SO Murken, Erich. Die großen transatlantischen Linienreederei-Verbände, Pools und Interessengemeinschaften bis zum Ausbruch des Weltkrieges: Ihre Entstehung, Organisation und Wirksamkeit. Jena: Gustav Fischer, 1922. The Nation, 1904 New York Times, 1904 NDL Annual Reports, Schiffahrtsmuseum Archiv, Bremerhaven, Germany. Reports of the U.S. Immigration Commission of 1907-1911, chaired by Senator William Dillingham, 1911. [Dillingham Report] Stopford, Martin. Maritime economics 2nd ed. London: Routledge, 1997. Times (London), 1904 Transatlantic Passenger Conferences reports, 1899-1914. 1 U.K. Report on Activity of the Hamburg-American Packet Company. Report by Consul Wilfred Powell. British Foreign Office (Public Record Office, UK), October, 1908. U.S. Bureau of Immigration, Annual Reports, 1895-1914. U.S. Bureau of Immigration files, 1900-1914 (National Archives, Record Group 85). U.S. Bureau of Statistics, Monthly Summary of Commerce and Finance, Immigrants Arrived in the United States, 1899-1905. Whelpley, James D. The Problem of the Immigrant. London: Chapman & Hall, 1905. SP Willcox, Walter F., and Imre Ferenczi, eds. International Migrations. 2 volumes. Volume 1: "Statistics with Introduction and Notes" (1929). Volume 2: "Interpretations" (1931). New York: National Bureau of Economic Research, 1929-31. PASSENGER LISTS 8: four from 1903 and four of same vessels, in same months of 1904 SECONDARY SOURCES Aldcroft, Derek, "The Mercantile Marine" in The Development of British Industry and Foreign Competition, 18751914, edited by Derek Aldcroft, 326-63. London: George Allen, 1968. Baines, Dudley. Emigration from Europe, 1815-1930. London: Macmillan, 1991. [Emigration] Brattne, Berit and Sune Akerman, "Importance of the Transport Sector for Mass Emigration." From Sweden to America: A History of the Migration, edited by Harald Runblom and Hans Norman, 176–200. Minneapolis: University of Minnesota Press, 1976. Cecil, Lamar. Albert Ballin: Business and Politics in Imperial Germany, 1888-1918. Princeton: Princeton University Press, 1967. Chernow, Ron. The House of Morgan: An American Banking Dynasty and the Rise of Modern Finance. New York: Simon and Schuster, 1990. [Morgan] OWN Hansen, Marcus Lee. The Atlantic Migration 1607–1860: A History of the Continuing Settlement of the United States. Cambridge MA: Harvard University Press, 1940. [Atlantic Migration] Hvidt, Kristian. "Emigration Agents: The development of a business and its methods." Scandinavian Journal of History 3 (1978), 179–203. Hyde, Francis E. Cunard and the North Atlantic, 1840-1973: A History of Shipping and Financial Management. London: Macmillan, 1975. Jerome, Harry. Migration and Business Cycles. National Bureau of Economic Research Publication no. 9. St. Albans, Vt.: Messenger, 1926. 2 Jones, Maldwyn Allen. "Aspects of North Atlantic Migration: Steerage Conditions and American Law, 1819-1909." Navin, Thomas R., and Marian V. Sears. "A study in merger: Formation of the International Mercantile Marine Company." Business History Review 28(4), 291-328 (December 1954). Nugent, Walter. Crossings: The Great Transatlantic Migrations, 1870-1914. Bloomington: Indiana University Press, 1992. Ottmüller-Wetzel, Birgit. "Auswanderung über Hamburg: Die H.A.A.G. und die Auswanderung nach Nordamerika, 1870–1914". Ph.D. diss., Freie Universität Berlin, 1986. O'Rourke, Kevin H., "The European Grain Invasion, 1870-1913." Journal of Economic History 57(4), 775-801 (December, 1997). Pitkin, Thomas. The Keepers of the Gate: A history of Ellis Island. New York: NYU Press, 1975. Puskás, Julianna. “Hungarian Overseas Migration: A Microanalysis”. In A Century of European Migrations, 1830– 1930, edited by Rudolph Vecoli and Suzanne Sinke, 221-39. Urbana: University of Illinois Press, 1991. Szajkowski, Zosa. “Sufferings of Jewish Emigrants to America in Transit Through Germany.” Jewish Social Studies 39 (Winter-Spring, 1977), 105-116. Taylor, Philip. The Distant Magnet: European migration to the U.S.A. New York: Harper & Row, 1972. Thistlethwaite, Frank. "Migration from Europe Overseas in the Nineteenth and Twentieth Centuries." In A Century of European Migrations, 1830–1930, edited by Rudolph Vecoli and Suzanne Sinke, 17-57 (originally published in 1960). Urbana: University of Illinois Press, 1991. Vale, Vivian. The American Peril: Challenge to Britain on the North Atlantic, 1901-04. Manchester: Manchester University Press, 1984. Walton, Gary M., and Hugh Rockoff. History of the American Economy. Fort Worth: Dryden Press, (7th edition) 1994. OWN Wätjen, Hermann. Aus der Frühzeit des Nordatlantikverkehrs. Leipzig: Felix Meiner, 1932. SP 3 FareWar-App1 Timeline, Timeline as of10/26/06 KEY ECONOMIC RECESSIONS, CHANGES IN IMMIGRATION FLOWS TO USA, AND PASSENGER "FARE WARS", 1870-1914 Percentage Change in GDP & US Immigration versus prior year Share of (fiscal year) Periods of of reduced fares Description of Fare Reductions Fiscal Years GDP Europe UK Germany 1874-75 -7% -51% -49% -68% UK Ger 45% 30% May 1874May 1875 1884-85 -7% -34% -30% -36% UK Ger 30% 38% 1885 1884-85 "widespread rate cutting" by 1/4 to 1/3 [in UK] (Hyde p. 104) Fares cut by 2/3 from Hamburg (Ottmüller, pp. 153-55) 1893-94 -13% -50% -42% -54% UK Ger 19% 19% 1893-94 1893-94 "damaging rate war" (Hyde p. 106) "cutthroat competition" and "rate war, " fares cut by over half in UK, also reduced from German ports (Murken pp. 57-60) "enormous reduction in fares"(by up to two thirds), mainly affecting Britain and Scandinavia, with the result that, for shipping lines, "the hemorrage of red ink threatened to drown everyone." (Flayhardt, pp. 166-69, 217) Immigrants to USA from Immigration from Europe 1893-95 1904 (2nd 1/2 1904) 1908 -1% -5% 3% -11% -39% 80% 3% UK Ger 10% 5% June 1904Jan. 1905 UK Ger 13% 5% Sep.-Dec. 1907 (slight reduction) "fierce rate-cutting war," "all the companies suffered severe financial loss." (Hyde p. 96) Prices from Germany cut in half for a year, wiping out HAPAG's reserves (Ottmüller, pp148-49). See also Mathies, pp. 90-91 "one of the fiercest rate wars in history" (Hyde p. 110) Fare reductions mainly routes from UK and Scandinavia. To some extent, reductions were also made for transit migrants from Russia and Austrian travelling through Northern Continental and Adriatic ports (Murken) Although "the economic crisis in the United States…[led to] the most serious fall-off in passenger traffic in many years, a rate war failed to materialize" [in 1908] (Aldcroft, Mercantile, p.354) Sources: GDP from "How much is that?" (http://eh.net/hmit/), Immigration from Historical Statistics of the United States, U.S. Bureau of Statistics, "Monthly Summary" FareWar-App2 Cun-85-14, Final Chart as of 10/26/06 £30 Fares-West Fares-East Passengers-West Passengers-East Steerage Fares in Pounds £20 £15 60 Recession of 1908 50 Recession of 1903-04 Recession of 1893-94 40 30 £10 20 £5 10 £0 1885 1886 1887 1888 1889 1890 1891 1892 1893 1894 1895 1896 1897 1898 1899 1900 1901 1902 1903 1904 1905 1906 1907 1908 1909 1910 1911 1912 1913 1914 0 Source: Cunard Voyage Accounts. Fares are Revenues / Passengers in steerage class, plus an adjustment westward for the U.S. head tax on immigrants. Steerage Passengers ('000s) £25 Steerage Fares and Passengers, Cunard Line, Liverpool-New York route, 1885-1914 Westbound Steerage Passengers and Weighted Average Fares, 1901-13 $50 700 600 $40 500 $30 400 300 $20 200 Weighted Average Fares (lefthand scale) Annual Passengers (righthand scale) $10 100 $0 0 1901 1904 1908 1911 Annual passengers on these lines ('000s) Weighted average annual fares of these lines FareWar-App3-Fares 1901-13, Fare War Appendix 3 (RIMH APP5) as of 10/26/06 1913 Data sources and comments: Annual fares and passengers shown here, and the additional statistics mentioned below are from Keeling, "Capacity, "Appendices 4,5 and 6. The weighted average fare series shown was compiled by adjusting the fares route length and then taking an overall average by weighting each line's fares, as adjusted, by the number of passengers it carried each year. Passenger figures in the graph here are those of steerage travellers westbound to New York, Boston, Baltimore, Philadelphia. Those ports accounted for 99% of all steerage arrivals to the U.S. in the period. The lines and route included here took 51% of those steerage passengers to the U.S. in the period. 1904, 1908, 1911 and 1913 were recession years in the U.S. (Jerome, pp. 100-119). In general, passenger flows were not negatively correlated with fares, as is often assumed. A major exception to this occurred during The 1904 fare war in Britain was the one signifiicant exception but does not show up in this graph because, overall, 1904 was a recession year and outside of Britain passenger volumes declined. Quarterly fares between Liverpool and New York of the Cunard line, a leading protaganist in the 1904 fare war, are shown in Appnendix 3 which follows below. Fare discounting also occurred during the 1908 recession and in 1913. Except for the 1904 fare war, fare differences between routes were fairly constant over the period. Fare differences across routes mainly reflected cost differences. Voyage costs were, for example, proportional to route distance. Average Quarterly Fare as % of "Normal level" FareWar-APP4 Price comparisons, QTR (%) as of 10/26/06 AVERAGE QUARTERLY WESTBOUND STEERAGE FARES TO NEW YORK, 1903-06, AS A PERCENTAGE OF "NORMAL" 125% Quarters of Low fares from Oslo: L'pool: Rott'dam: 100% 75% 50% Cunard, Liverpool Holland America, Rotterdam From Kristiania (Olso) 25% 0% I 1903 II III IV I 1904 II III IV I 1905 II III IV I II III IV 1906 Source: See Appendix 3. These three routes are the only ones for which fare data is available on a more frequent than annual basis for this time period. Other routes, particularly those from Adriatic ports were also affected by the fare war though none as severely as those out of the U.K. and Scandinavia. "Normal level" of fares: Cunard, Holland America = average of 1903, 1904, I-II, 1905, II-IV, Oslo = average of 1903, 1904 I, 1905. Shown here as "100%." Two sets of annual fare figures (those of Glasgow's Anchor Line and those for the two German lines, HAPAG and NDL) reflected in the graph of Appendix 3, are consistent with three quarterly series shown here. On a year to year basis, averaging fares for all of 1904 and comparing them to 1903, precentage drops were roughly comparable for the three series in the main fare war region (Cunard: -37%, Anchor: -32%, and Oslo: 30%) and for the two outside of it (Holland America:-13%, German: -3%) Monthly Immigrant Passenger Crossings from Europe to the USA: Nationalities and Embarkation Ports, 1903-04 Immigrants of UK or Scandinavian Nationality Immigrant Passengers embarking in UK & Scandinavian Ports Immigrants NOT of UK or Scandinavian Nationality Immigrant Passengers embarking in ports outside of the UK or Scandinavia 100 80 60 40 1903 Sources: Bureau of Statistics, Transatlantic Passenger Conference 1904 Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb Jan Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb 20 Jan Monthly Immigrant Crossings ('000s) 120 Monthly Passengers between USA and UK/Scand. APPENDIX 6A: Monthly Steerage flows from Scandinavia and the U.K. (westbound to the USA) 40,000 30,000 1904 20,000 1903 10,000 1900-02 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Monthly Passengers between USA and UK/Scand. APPENDIX 6B: Monthly Steerage flows toScandinavia and the U.K. (eastbound from USA) 40,000 1904 30,000 1903 1900-02 average 20,000 1904 10,000 1903 1900-02 0 Jan Feb Mar Apr Source: Voyage database May Jun Jul Aug Sep Oct Nov Dec APPENDIX 7A Migrant Crossings from all of Europe to USA, by migrant type, 1900-1914 Independent Repeat Sources: Table 6 Dependent APPENDIX 7B Estimated breakdown, by migrant type or other reason, of the increase in migrant crossings from UK and Scandinavian embarkation ports to USA, as result of reduced fares, July-December, 1904 Dependent Repeat Accelerated Timing Independent Re-Routing Source: Table 6
© Copyright 2026 Paperzz