Now freight rates were cut, and the
British premier is quoted as advising the Cunard Company to run without
freight if necessary to "beat off the American line."[AM] The increasing
subsidies occasioned a Parliamentary investigation. The committee,
evidently impressed by the gravity of the American competition, reported
that "the cost of the North American service was not excessive," but
they advised that all contracts thereafter "be let at public
bidding."[AN] This recommendation was not heeded. In 1857, upon the plea
that the Americans were about to build larger and more powerful liners,
the Cunard Company asked a five years' extension of the contract of
1852. The extension was promptly granted. At the same time they were
awarded an additional subsidy of three thousand pounds for a monthly
mail service between New York and Nassau in the Bahamas.[AO] The next
year (1858) after suffering crushing disasters in the loss of two of
their steamers, and the withdrawal of their subsidy, the Collins Company
failed, and their line was abandoned.[AP] So this competition ended.
Meanwhile complaints of the Admiralty's partiality in the allotment of
the contracts had been renewed more vigorously, with wider criticism of
grants for mail carriage largely in excess of the postage received; and
in 1859-60 another Parliamentary investigation was made.
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