The New York herald., 1922-05-11
URGE US. TOEXPAND
ITS FOREIGN TRADE
Business Leaders See Americas
Welfare Dependent on World
Prosperity.

PHILADELPHIA. May 10.--Bankers,
manufacturers of locomotives and
farmers at the ninth National Foreign
Trade convention to-day agreed that the
nations of the world are economically
interdependent. Speakers at the OPEN
ing sessions. attended by some 1000 dele
gates from all sections of the United
States and number of foreign coun-
tries. found themselves in accord on
their diagnoses of the causes OF the
worlds trade depression. Their sug-
gested remedies were based upon the
necessity of "a return to normal world
trade conditions and the expansion Of
Americas foreign commerce"
Attempts to minimize The Importance
of the foreign trade OF the United States
by asserting that 1t was only 10 or Is
per cent. as compared with domestic
trade OF IS or 80 per cent. were de-
clared dangerously fallacious" by
James S. Alexander, president Of the
National Bank of Commerce of New
York.
The difference between normal busl-
ness conditions and q depression is no
more than 15 or 20 per cent. in volume"
Mr.. Alexander declared. Those who
consider the mere ratio of foreign and
domestic trade lose sight Of the fact that
foreign trade Is a safety valve and that
without it domestic consumption would
shrink and national prosperity-wane"
Mucls-of the Industrial depression fol-
lowing the war, Mr.. Alexander said, was
due to the expansion of productive ca
pacity of Industrial plants during the
war boom. Estimates of this overca-
pacity. he added, varied from 25> to 100
per cent.
Although the German mark is at the
bottom Of the heap OF falling European
exchange German business men have
millions of dollars in gold credits in
other countries, according to Charles NJ
Muchnic of the American Locomotive
Sales Corporation, New York. Ger
manys manufacturers figure production
costs on the deprecated value of tho
mark and sell abroad for gold at prices
as high as 100 per cent. above the pro-
duction costs. he said. and In getting
these high profits are driving the ex-
change value of the mark still further
down. -
The question OF the eleven billion
dollar war Indebtedness was referred to
by J. T. Holdsworth. vice-president Of
the Bank of Pittsburgh. THE role OF
n creditor nation is new and strange
one for the United States" he said, "and
America has most to gain or most to
lose in the settlement of the worlds
economic problems"
The effect of high income surtax
rates was discussed in paper by J. c.
Ainsworth of the United States National
Bank. Portland, Ore. The paper said
high surtax rates We're discouraging
American capital from many industrial
ventures. The death of a prominent
banker disclosed recently that of an
estate of sS5,000.000 less than III per
cent was taxable under the income tax
law. The rest. IL was said, was in tax
exempt municipal. State and Federal
bonds.
Capitalists were unwilling, Mr.. Aims
worths paper continued, to take risks in
cident to foreign trade ventures when
a large percentage of the profits would
be lost through the income tax. The
result had been large purchases of tax
exempt governmental bonds with the
consequent tendency to "extravagant
and needless improvements"