The Waterbury Democrat., 1934-08-13

like it or not, the fact remains that our economic structure has been developed and our proeuctive cap acity adjusted to a type of output that is dependent on foreign mar kets; and those markets depend absolutely on our willingness to ac- cept foreign goods and services in exchange for our own, states the Guaranty Trust Company of New York in weekly review of business and financial conditions of the United States and abroad.
 Our concern in international trade is not merely matter of the refusal of other nations to pur- chase our goods if we are not will ing to buy theirs; it is an economic impossibility for foreign countries to take our products unless we, by accepting imported commodities provide foreigners with the means to pay.
 It seems difficult for many Amer ican business men not directly en- gagged in dealings in commodities and services with foreign nations to comprehend fully the relation ship between their profits and con- ditions abroad. To state the matter simply, the individual business man becomes involved in develop = ments abroad because he consti- tutes part of a domestic economic system that is highly concerned with international factors. Any oc- currence abroad that either inn proves or retards our economic pro gress in general will affect his pro- fits in a similar manner. Very few types of business, if any, have been able to run contrary to the forces of recession in general business during the last few years.
 The stake" that our general economic organism has in develop ments abroad, while at times some what indirect, is by no means ob- scure. First, and without doubt the most important, a sure method. of easing political tension in many parts of the world is by bettering the standard of living. Business confidence, on which actual bus mess commitments are based, would be greatly furthered by a cessation of political disorders in some parts of the world.
 Second, an improvement in world economic conditions would be almost automatically followed by a greater stability in interna- tional monetary conditions and by a clearing up of the exchange diffi- culties that have seriously disrupt ed the normal flow of international trade. These developn ents. in turn would greatly facilitate information al currency stabilization and the elimination of destructive trade barriers, with highly beneficial ef- fects on international trade. 1n- cluding that of the United States.
 Our third source of interest in foreign affairs lies in the fact that
 this country since the war has grown into one of the leading cred itor nations of the world. Disre- garding the war debts, foreign countries are indebted to the Uni ted States to the extent of billions of dollars, excluding short-term credits. This financial stake is made up of direct and portfolio invest. ments: the latter are mostly pay able in gol dand composed of hold I ings by Americans of securities of foreign governments and their po- litical subdivisions and of secur- ities of foreign corporations. An improvement in economic condl- tions in these debtor nations would provide their governments with sources of taxation with which 10 meet service payments, while the advantages of security holdings in a private corporation whose bus mess is operating profitably are obvious.
 It is not only the investor in for eign securities, the American cor poration with plants abroad, the exporter, the importer. the inter national banker, and the worker engaged in producing goods for the foreign market that depend fol their prosperity on conditions in other countries. Not some, but all, of the people feel the effects of de- yclopments abroad, whether they realize it or not. It has already ben pointed out that the depres- sion is a worldwide upheaval, ana it is hardly necessary to add that the effects of this international crisis have not been limited to cer- tain groups. Workers, fogmers. and business men in the interior have suffered as much as anyone else. Such individuals, having no direct contacts abroad, may regard them selves as the victims of purely do- mestic situation; but they are not Their plight is result of catac-