Evening star., 1935-05-19

Ia VVAAAAAA4NA Ass SEho n S@t SAsB
Former United States Undersecretary Of
State.
n YEARLY everybody admits that
\ to achieve anything like our
VI former prosperity we must
/ somehow restore our foreign
trade. And at that point all
agreement ends. Official Washington
so busily wrangles over details Of
method that results are lost sight Of.
One bureau publishes statistics to
prove, through the increased sales
abroad of some commodity which most
of us never heard of, that we are
getting back our pre-war volume Of
trade; and another bureau shows that
the sales of some other commodity
have fallen off and that we therefore
are still on the down grade.
Nobody ever, so far as know, takes
into account the difference in the
number of dollars bought with an
equal amount of foreign exchange
and, after all, that difference shows
startlingly in volume Of goods. The
Secretary of Agriculture tells us
earnestly that we cannot expect to
sell unless We buy-he insists on 1t
with such solemn determination we
begin to feel that only our import
statistics have any value, that if we
sell anything it is out of pure kindness
of heart.
The Secretary Of State assures us
that there can be no successful for
eign trade unless we cling with all
our might to the general-most-
favored-nation principle Mr.. Peek.
the Presidents adviser on foreign
trade, asserts with equal vigor that
in these difficult days the principle
supported by Mr.. Hull is quite unim-
portant and that only through BIZ
lateral exchange, through separate
agreements with the various nations
which have something to sell us and
want to buy from us, is there any
hope of restoring trade.
Silver Distresses China.
The Secretary of Commerce un-
doubtedly wants to give the whole
matter very serious study; and the
Secretary of the Treasury triumphant
ly adds to the months total of pur-
chases by buying silver abroad at such
progressively high prices that China
sinks under the blows of defiation,
thinks about the possibility of going
on the gold standard, and in any case
is too distressed either to buy from us
or to sell to US
Another mercifully small group in
sists that the only way to carry for
ward international trade Is to inaugu-
rate in America a managed currency
which can be induced to meet all
fluctuations. When you ask which
fluctuaticus?" they get very annoyed
and call you a tory or something.
There are followers for every theorist
now, except for the advocates of really
sound money and of the law of supply
and demand.
Although it is generally unwiSe to
be dogmatic, there can be no danger
in the assertion that we shall not see
any substantial revival of information
al trade until we have something ap-
proximating stabilization of currencies
and until we recognize that the world
is not going to buy what it does not
really want and that it will not buy
from us what it can buy cheaper
elsewhere. The idea in Washington
just now seems to be that you can
somehow circumvent these elementary
truths, that you can trick trade into
flowing through unaccustomed or un-
natural channels. 1t simply can't be
done.
Curiously enough, many people seem
unable to understand why currency
stabilization should be necessary. 1t
is clear that a nation with devalued
currency will normally find it easier
to sell and harder to buy. 1t now
takes more dollars to buy 1000 francs
worth of goods than it did a couple
of years ago; and it takes fewer francs
to buy 500 worth of goods than it
did a couple of years ago. But these
difficulties always settle themselves in
time, and the question is raised as to
why discrepancies of this nature are
SO vitality important; they might
change the currents of trade, but
would hardly lessen the flow.
As matter Of fact, 1t is not the
difference In the values Of currency