The Washington herald., 1921-07-13
Mr.. Hoover Declares us.
Has Vital World
Interests.
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upon our imports and that our ex-,
ports are the great balance wheel
for our production. Exports are
vital to the stabilization of our in
dustries. of price levels, Of wages,
and of employment. While our ex-
ports do cover but a small per cent
of our total production. on the 9TH
er hand they do comprise a large
percentage of the production of
certain industries.
For instance, We generally ex-
port 20 per cent of our wheat. 60
per cent of our cotton, 10 per cent
of our copper, not to mention otn-
ers. Unless we find a market for
the surplus production of our great
Industries, we shall continue 10
keep some 25,000,000 of our people
in reduced buying power. We might
even drive them into poverty-dur-
ing the many years that would be
required to shift the whole basis
of our internal production. Nor
does a nation become rich by its
exports alone-but by its trade.
Come From Europe.
; while many of the causes of
the present depression lie within
our own borders, yet there may be
no recovery from these hard times
for many years to come, IL we neg
lect our economic relations abroad.
Even if We lower our vision of civ
ilfzation in this crisis solely to our
own selfish economic interests, we
are yet nightly concerned in the
recuperation of the entire world.
The hard times that knock at
every cottage door today came from
Europe. No tariffs, no embargoes,
no navies, no armies can ever de-
fend US from these invasions. Our
sole defense is the prosperity of our
neighbors and our own commercial
skill. The recovery of our foreign
trade can march only in company
with the welfare and prosperity OF
our customers.
Econcm mic Current shifts.
when we analyze the present
foreign trade situation We find tre-
mendous shifts in economic cur
rents since 1914. Indeed, we hnd
great changes still in progress. II
We would guide our policies OF pro-
duction and of trade Alright, we
must keep these great changes con-
stantly in mind.
These profound alterations nat
urally fall into two divisions: The
shift in the worlds production and
markets and the shift in the worlds s
financial relations. They bear upon
each other, and they affect our
three primary groups of food, raw
material and manufactured goods
differently.
There have been great changes
in our own economic situation. We
have not alone shifted from adebt-
or to a creditor nation. Our capac-
ity for surplus production in food
and manufactures has grown enor-
mously during the war until we
have taken front rank of the world
in foreign trade.
Food Exports Grow.
The direction of our trade has
shifted greatly. During the last
year about one-half Of our whole
foreign trade was with Europe, but
of our exports to them 10 Per cent
were foodstuffs andrraW rhaterial !.
of our exports to ystateS outside of
Europe about rs per-. cent were
manufactured goods. Europe in
turn is our serious competitor in
marketing of our manufactured
goods to the rest of the world. We
have enormously increased our i'm
ports of tropical and other COM
modities that we do not produce.
Since the great war began the
world outside the fighting states of
Europe has gained nightly in
wealth, in standards of living, and
in consuming power. Even omittinG
the United States. it has gained
something like 100000 in popula-
ton. The countries not directly af-
feCted by the war are indeed suf-
rering from the general depression.
tut this depression with them is
only the aftermath of the malevo-
lent forces born of the past war
booms. They have none of the deep
economic wounds of the fighting
states, and they will be quick to re-
cover. During the war the produc-
tive capacity of these states, ex-
cept possibly Japan, had no unusual
increase because of their isolation
through shortage of shipping.
Russia Affects World.
"one of the economic shifts that
affects the whole world profoundly
is from Russia. Russia bore much
the same relation to western Eu-
rope before the war that the Mis-
sissippi Valley bears to our North
eastern States. Russia was one of
the great food bases of the manu-
featuring countries of western Eu-
rope. exchanging food for their fab
ricated products. These manufac-
tured goods in turn were to some
degree produced from our raw ma
terials.
Even at best it will he many
years before Russia will have re-
covered. We are today the only
great source of enlarged food pro-
duction. Europe must and will
draw from us a great proportion of
food supplies that she formerly
drew from Russia. 1 see no basic
reason why we should not continue
to export approximately the same
large volume of foodstuffs that we
have shipped abroad during the past
twelve months. This item alone at
even present prices would be triple
our prewar food exports, and would
represent the equal of more than so
per cent of our whole prewar ex-
port trade.
German Exports Grow.
Another great but uncertain
shift in world forces will arise out
of Germany. The reparation pay
ments must have a profound effect
upon the whole economy of the
world. Germany is to pay outside
her borders to the allies $500. .000, 900,
plus 26 per cent export duty. or, say,