Perth Amboy evening news., 1921-10-06
BANKERS HEAR
Of FREE ZONE
Can Develop Foreign Trade
by Free Ports and Zones,
Henry M. Robinson Says

~
methods by which the United States
can develop her foreign trade and
at the same time maintain a protec-
tive tariff were outlined here today
when Henry NJ. Robinson. formerly
commissioner of the United States
Shipping Board and now president
Of the First National Bank of Los
Angeles and the Los Angeles Trust
* Savings Bank, placed the entlre
problem of free ports and Tree zones
before the American Bankers Assu-
citation in annual convention, through
his discussion of the trade zone Dill
which Senator Jones, OF washington
now has before congress.
Mr.. Robinson-an ternatlona
figure-Whose opinion on natlonal
affairs is widely recognized, spoke as
one Interested both in a protective
tariff and in foreign trade, ana
pointed out the apparent
tency of attempting to develop ooth
at one and the same time, staIlnS
that Ii Is only through the establish
ing of a free port and a free zone
policy that the foreign trader n
The protectionist can meet on com
mon ground and the ends 10 whlch
both are working can be accom-
plished.
After pointing out hat the Jones
bill. as now amended, provides nee
essary machinery for the creation
of foreign trade zones in, or adJa-
cent to, American ports of entry, ana
authorizes the secretary of com
merce to grant tc states, munlcipall-
ties and their legal subdivisions the
privilege of establishing such zones
Mr.. Robinson summarized the pro-
visions of the bill. and pointed out
that. whereas, under the terms OF
the bill, both foreign and domestic
merchandise may be brousht into u
free zone and there be broken up
assembled, mixed with foreign or
domestic merchandise or otherwise
for re-export. direct
manufacturing, as such. may not De
carried on within the proposed dis
t~jcts-this in order to meet n
wishes of interior communities n
10 allay their fears as to
manufacturing competition.
Mr.. Robinson said in part:
..IJnder the terms of this act, no
dlty is to be applied to
delivered from ship to wharf with
4, a free zone unless some part, or
al. of il is taken out for domestic
Iansumption, at which time 1t VIII
iss through the customs house ana
IS subject to regular duty.
sIn other words we may, Wltnln
certain districts within our ports OF
.ntry. be free trade nation ana AT
me same time protect u own DOM
rsfic markets from a flood of cheap
~ manufactured European and ASH
a.ic goods.
SIT is automatic that, for the pro-
lection of the American manufac-
tarer. a method must be PROVIDED
for the maintenance of a
marine which will carry abroad the
surplus of American manufactured
goods: otherwise, these goods must
continue to back up upon our own
markets and thereby reduce the
earnings of our manufacturers, the
profits of our merchants and the
earnings of American labor, itself.
There is appearing from time TO
time in certain publications the suS-
gestion that most of u products
are consumed al home and that u
about ~one-Seventh is available for ex-
port. and. hence. that our foreign
trade is a relatively unimportant rae
tor in our national prosperity.
Accepting these figures as true
economists generally agree a sur
plus is the controlling factor. Is IL
not. therefore, reasonable to assume
that it is the backing up of our man
ufactured surplus and our 1nablilty
TO sell abroad hat has brought about
our unemployment situation?
..Since the beginning. any nation
that has engaged, with any appre-
ciable degree Of success. IN internal
tional m has been either on a
free trade basis. or has maintained
one or more free ports or free zones
sFor years, however. we, as a ma
ton. have maintained a high tariff.
and mosht of the time a very high
protective tariff, and. for half a CEN
fury our flag has been a comparative
rarity upon the seven seas.
"Came the Great War. and demon
strated beyond cavil the need for the
maintenance of a merchant fleet, II
in time of war. the nation is TO be
protected-and this, whether the war
be military or economic.
1.-THE Great War also demonstrat-
ed fully the interdependence of peo-
pies and nations-and their depend
ence upon world trade.
''Since the maintenance of a mer-
chant fleet is obviously predicted on
world trade, 1t is evident that a high
protective tariff, world trade, the
maintenance of a merchant fleet with
the financial and commercial accom-
paniments of those operations, are
inconsistent. but experiences of Eu-
ropean nations show co~nclusively
that a modification of this inconsis-
tency a be brought about without
definite injury to the principles in
volved in a protective tariff.
"In fact, if the feeling continues
10 grow that we should ngage in
world trade and maintain a merchant
fleet, as a necessary corollary. the
principle of protection must, of ne
cessity, be greatly modified, unless
some method is devised that will per-
NIT a world trade of merchandise IN
and out Of our important ports of
entry without the delays and expense
attendant on our present methods Of
operation.
1T is true that under the present
law imported merchandise may be
impounded in bonded warehouses
and withdrawn for trans-shipment,
or may be impounded. Withdrawn
and manufactured and then trans
shipped in foreign trade with a draw
back of the customs paid. This plan
was intended to meet the needs OF
world trade. but is nearly inopera-
tive and utterly fails of accomplish
ing the main purpose, in that the
time consumed in vessel delays and
in the unwinding of red tape mill
tates against such an operation.
eff ii be true that the cost of OPP
-ratiun OF our merchants ships Is
to be greater than hat of the inn
portant competing nations. some
method must be devised to balance