South Bend news-times. (South Bend, Ind.) 1913-1938, 1921-05-19
FOREIGN TRADE
NOT ESSENTIAL OF
FAIR PROSPERITY
Nanderlip, in Interview, De-
clares Wages Won't Hit
Pre-War Mark.
BY II. \. RICKEY.

I
home at Scarborough-on-th Hud-
son. Vanderlip ought 10 know and
probably does know as much about
American foreign trade. especially
its financial aspects, as any man in
/ the country.
For 10 years. 1909 TO 1919, has
was president Of the National City
te.k Of New York. the biggest
-ational bank in America. He or
ganized and is now the chairman Of
the board Of directors of the Amer
lean International corporation and
/ is a director and member Of the
/ finance committee of the Interna-
tional Mercantile Marine Co.
1t was TO get Vanderlip's views on
this important subject Of foreign
trade that 1 arranged for the inter
view.
Ny first question was: "To what
extent does the future prosperity OF
this country depend on the develop
ment Of foreign trader"
I 1T may surprise you 10 have me
say that I do not take the extreme
/ position that this country cannot en-
JOY fair degree Of prosperity with
out developing a great overseas ex-
port trade" was the answer
"Of course I do not take the
other extreme position that we are
so self-sufficient and self-contained
as a nation that foreign trade is a
factor that reed not be considered.
Somewhere between these two ex-
tremes Of opinion lies the real
truth. We cannot attain the high
state of prosperity 10 which our
natural wealth, business genius and
population entitle us without at
least normal foreig ntrade devel-
opment."
Us the problem of the develop
ment Of American foreign trade to
the extent that it is a problem, a
thing that can be solved govern
mentally or is it the problem Of
American business in its private ca
pacity?"
Broadly speaking it is a problem
for business in its private capacity.
1 do not mean that the government
by sympathetic understanding and
effort cannot help. But it can only
help. The initiative and energy
must be supplied by the American
business man.
Early HandiCaps.
Before the war our foreign trade
failures were due in large measure
to the refusal of financial and in
dustrial leaders to apply the same
intelligence, energy and patience to
its development that they did to do
nestle business. In addition to this
we were also handicapped by the
higher wage levels in this country
as against England, Germany and
Japan. But even in those lines
where, by the economy Of mass pro-
ductiOn, we had overcome the handi-
cap OF higher individual wages, we
did not take full advantage Of our
opportunities. Our effort for for
eign trade was more or less a hap
hazard, spasmo dic effort, and as an
American 1 regret 10 say that we
were not any. too honest in our for
eign trade methods. BY and large,
II should say that we got ali the
foreign trade we were entitled to in
the pre-war period.
''The war created such abnormal
conditions that our foreign trade
figures during that period mean lit
tie or nothing as applied and Will
face in the future.
Having become a creditor nation
our whole relationship with the rest
Of the world in terms Of trade and
finance has changed
Long Credits Needed.
rs it possible" / asked, "for us to
absorb enough imports to balance
our exports, and thus maintain our
position as a creditor nation, with
out causing a shrinkage in industry
and continued unemployment?
quite possible, if we recognize
the necessity Of selling abroad those
things which we can produce more
cheaply than other nations and buy
ing from abroad those things which
other nations can produce more
cheaply than we can.
Fore ign trade is not a one-sided
arrangement. In the final analysis
the only way we can be paid for
raw materials and manufactured
goods we export is to take goods in
exchange.
Gas the basis for building up our
foreign trade iq the new era which
we are now entering we must ex-
tend longtime credits Also we
must be prepared to invest our sur
plus in foreign securities. This is
the policy that made possible Eng
lands foreign trade development.
Before the war the total Of Eng
lands foreign security holdings was
tbout twenty billion dollars. To
maintain our present position as
creditor nation our foreign invest
ments ought 10 reach forty billions.
German Competition.
with the settlement OF the repa-
rations question, isn't Germany go
ing to give the rest Of the world, in
Guiding America, keener cOmped-
ton for foreign trade than ever be-
fore?"
1T seems logical to suppose that
she Will. The very necessities OF
her situation will compel Germany
10 organize her industries on the
most efficient possible basis, which
means low production costs. II is
up 10 US 10 meet German efficiency
with equal or greater efficiency, not
for the purpose of killing off Ger
man foreign trade. but simply 10
maintain our position.
"Our foreign trade policy should
be live and let live, recognizing that
in the case of both England and
Germany their existence as great
nations depends upon their ability
70 export great quantities Of goods.
Their export trade is vital 20 them.
With US foreign trade is important