Evening star., 1934-09-23

set an example Tor Other natlOnS.
glance at the statistics reveals the
prospect. In 1881 we sold Europe our
own products to the amount of about
$3.50, 100000 and took from it goods
valued at S525 100000. In 1882 we sold
to the amount of s725 100000 and
bought to the tune of $3.50 900 ,000
The difference in our favor in the first
year was S425, 900, 900 and in the Sec
ond 1866, 100000.
Invisible" Items.
There are various so-called "invis-
ible" items which go into the account
to swell our foreign payments, but
broadly speaking these figures suffice
On the basis of them the European
nations could perfectly we'll say, Buy
$3.50 ,000,0 more of us a year or we
shall buy that amount less of you"
And that is exactly the game which
the SovietS started and Germany is
now adopting.
Now look at the other side of the
picture. In 1881 our exports and i'm
ports in North America about bal
anced. but we bought something like
S150,000,000 more from South America
than we sold there, and 100000, 900
more from Asia. On the basis of these
figures, then, we could undertake to
persuade South American and Asiatic
countries to buy $3.50 900 900 more
from us, but we should face the loss
OF $3.50, 100000 in our European sales.
We should be 100000 900 to the bad
in the deal
OF course. what DR.. Schacht Is up
to now is to use control of foreign
trade as club to force exporting
countries to make concessions He
wants credits from the United States.
In view of the present practical ces-
sation of the payments on past loans
Germany can hardly expect to get new
loans under normal circumstances.
But as we sell Germany annually S6O,-
100000 more than we buy from her
and most of what we sell could be
bought elsewhere, Dr. Schacht can
coolly demand credits or cut off that
amount of trade. In the British case
the average excess in purchases of
us is around 100000 900, in the
French $5O,000,00O
Then will begin pressure from those
who export cotton, meat, copper, ETC..
upon our own Government to permit
loans, to approve the extension of
credits. Or the German government
can perfectly well demand that the
United States Government intervene
to prevent the Jewish boycott against
German goods, pointing out that this
merely leads to a reduction Of Ger
-, l.,
OF course, in the long run the ma
ton which has to buy raw materials
abroad and can only sell manufac-
tured goods is bound to be in a bad
situation. For what 1t buys it must
have, and what it sells other countries
can buy in many places.
To run their industries the Ger
mans have to import almost every
thing but coal. To get these raw ma
terials which they must have, they
have little or nothing to offer that
the world must buy from them. That
Is the basis of their present trouble.
Nations have stopped buying Their
goods, but those nations can get along
without the goods.
Germany, on the other hand, must
have the raw materials to keep her
own people fed, clothed and employed.
Without cotton, yarn, copper, iron,
rubber and tin, what can she do? And
if all countries stood fast in refusing
her credit and in restricting the p;lr-
chase of her goods, in the end she
would be faced by lowering of the
standard of living which would pre-
cipitate social disorder at home. And
it is to meet that peril that Schacht
is now called upon to act as a di-
rector of trade.
The difficulty is that no county is
likely to sacrifice its domestic employ
ment in one field in order to increase
it in another. A private business
could do that. But to ask the Ameri-
can iron and steel industry to sacli-
flee a part of its business in order to
enable German rails and structural
steel to come into the United States
and thus permit American copper and
hogs and cotton to be sold to Ger
many in larger quantities would raise
a political issue and a sectional in
terest of the first order.
What DR.. Schacht can and doubt
less will do is to reduce German pur-
chaSes in the United States. What he
will also try to do-and proba bly, fail
to accomplish-will be to increase
American purchases in Germany. He
hopes that the threat of reduced pur-
chases from the United States will
lead to new credits or lower tariffs.
The chances are neither will happen,
because no one is inclined to risk
money in Germany under present con-
ditions and in the light of recent
events, although the objective of the
Roosevelt administration is immediate
recovery and Dr. Schacht's alternative
might insure a temporary rise in un-
employment in certain industries.
Last Desperate Gamble.
But this German program will
amount to throwing new monkey
wrench into the machinery Of inter-
national trade. Literally, it consti-
tutes Germany's last desperate gamble
to escape from a situation due partly
to economic and partly to political
circumstances. If she cannot coerce
the rest of the world into buying
more of her goods, she must slip
downward steadily. All the talk
about autarchy is nonsense. You
can't mobilize fats out Of the air,
you can't produce iron out of the
atmosphere. The limits even Of the
miraculous are fixed.
On the other hand, you can't sell
more abroad than you buy or you
lend-that IS what the United States
is up against. And you can't sell
more to any one country than you
buy of it or lend to it, unless it
chooses to let you, and itself is able
to reverse the process elsewhere.
Schacht can and doubtless will say
to the United States: Sixty millions
more bought of us or s60,O00,0O0 less
sold to U.S." The French might in
turn demand that we buy $4,000, 900
a year more of them.
In such a game the United States
will be the first loser and in trade the
greatest victim. But in the end, since
We are the most nearly self-sufficient
of nations, we shall be able to MAIN
tain the highest standard of living of
ALL But what is less certain is