Evening star., 1937-10-08

to real economic
recovery and DAVID Lawrence.
sound fiscal position.
The crying need of today for Amer
lea is an increased volume of trans
actions-more business, more trade
more production, more employment
the home market, to be sure. has
never been cultivated with sufficient
intensity, but the foreign market has
IN the past given American producers
many billions Of dollars in trade. It
can do so again.
There are and have always been
TWO schools of thought on this point.
One argues that we should be self
contained. erect high tariff walls to
exclude other countries goods. and. in
snort, pursue policy of economic
nationalism. The other urges that we
exchange goods on fair basis with
other countries, that We should re-
duce tariffs as far as possible. that
We make reciprocity treaties to en-
courage volume of trade, and that
restrictions on gold exchange be grad
ualy removed. Such a program is
often called enlightened nationalism.
Champions Second Course.
This correspondent has for more
than 40 years championed the second
course, believing that the policy of
international cooperation as outlined
by President Wilson would If adopted.
have saved the world from the catas-
trophe Of 1929 and that the trans
formation of the German and Italian
democracies into relationships would
thus have been avoided.
Cordell Hull, Secretary of State, has
contended in season and out of season,
when he had the ear of the world.
and when he didn't, that economic
nationalism leads to war and human
conflict. The Republican party made
its major error of the last campaign
when 1t refused to commend the
objectives of the Hull policy, and this
point was emphasized by the writer
before and after the Cleveland con-
vention last year.
Today Mr.. Roosevelt. after being
for three years somewhat lukewarm
toward the Hull policies, has embraced
them whole-heartedly. 1t was the
only course he could take in a world
in which democracies were rapidly
being rendered less and less able to
protect themselves not only against
the ravages of war but the ravages of
economic depression growing out of
nationalistic policies all over the world.
Those who do not believe in the
world trade idea and the importance
OF building volume of business by
improving trade relations must accept
the alternative policy-domestic regi-
mentation. the rationing of what we
have within our borders. and an almost
arbitrary redistribution OF wealth.
They can hardly say the New Deal to
date has not been a logical corollary
OF economic nationalism.
Not Enough Business.
For there isn't enough volume OF
business within the United States to
support an economy in which higher
and higher labor costs means higher
and higher prices. There isn't enough
national income to keep on paying the
necessary taxes to maintain relief roles
Indefinitely. The United States can
produce more food and more manu.
factured goods without increasing its
acreage or its plant capacity. The
Brookings Institution in its significant
studies points OFT that even in 1929
we never used 100 per cent of our
plant capacity.
Prices can be kept from soaring only
II production can be increased and a
market found for our products. The
proposed system Of crop control which
Mr.. Roosevelt wants put into law at the
coming session of Congress is a kind of
economic nationalism-a contradiction
OF his international policy-but he will
seek TO justify 1T no doubt as a tenn
porary measure until the world econ
omy and world purchasing power can
be restored.
The criticism which the isolationist
VIII make Of the international CO.
operationist doctrine outlined above
u that the rest Of the world doesn't
nave the money to buy our goods. that
~ Is now using substitutes. But the
other nations will forego the cheaper
substitutes and will buy our products
II their businesses are restored. Thev
need capital as do many of our home
industries.
In Kentucky much gold is buried
~ unused. A portion Of 1.-THE
proflt from devaluation-can form the
basis OF a proper use Of international
credit to rid the world of war and
dictatorships. Germany accepted Hit
ler only as the alternative to anarchy
30 did Italy embrace Mussolini. The
German and Italian peoples will get
their liberties back when famine and
unemployment and shortages of goods
and credit no longer menace their
security. Revolutions and dictator
ships are the diseases Of poverty and
not the phenomena of prosperity.
Peace and Sterilization.
How is economic improvement re-
hated to our new foreign policy? The
primary need of the world is peace
and -stabilization of trade. They 20
together. Such added employment as
Is given to the workers in Europe has
resulted from armament building.
This Is unsound. When it ends, there
Is danger Of worldwide economic re-
pSrcussions. Americas duty, together
With Britain and France. = to build