Evening star., 1938-04-24

prices Of farm products, we need not be
surprised that the export market should
suffer. notwithstanding the depreciation of
the dollar. Whereas iron and steel mill
products constituted 3.6 per cent Of our
export trade In 1926-30 and sl per cent
in 1887. unmanufactured cotton declined
from 1863 per cent to 112 while our cotton
production mounted
The trend in cotton exports, so impor-
tant to the South, is erratic, and its future
uncertain, due to crop fluctuations, foreign
efforts at cotton growing, the great devel-
opment Of rayon, etc. More significant is
the changing composition Of our entire
foreign trade as we become increasingly
industrial. Before the World War Europe
looked on us as farming country. From
50 to so per cent Of our annual exports, As
a rule. were agricultural products. Since
1921 the proportion Of such exports has
declined severely In 1887 it was only
"a per cent of our total exports. and dur
ing the four years l934-37 averaged only
about 80 per cent.
Industry Requires Imports.
The larger our industrial activity be-
comes, the more we draw upon foreign
agricultural producers Of commodities un-
obtainable or insufaciently available here:
Rubber, tropical fruits, coffee, cocoa, tea,
manganese, tin, etc. Just Is manufac-
lures and semi-manufactures account for
70 per cent Of our exports so crude ma
terials and foodstuf1s account for 60 per
cent Of our imports. OF the so per cent.
70 Is foodstuffs alone. Our imports of
crude foodstuffs in 1887 were more than
twice the volume Of imports in 1918 and
those Of manufactured foodstuffs almost
~ times as large.
It Is proper for an industrial country to
import raw materials, paid for by exports
OF manufactures. Imports and exports
need not balance bilaterally. 1t is sum-
cient If they attain approximate balance in
the sum total In other words, our ex-
ports to New Zealand. for example, need
not balance our imports from New Zealand,
If trade is relatively free
But now trade is far from free Numer-
Gus and ingenious barriers have been
raised against international commerce. In
this respect We have been no exception, as
witness the Tariff Act of 1890
A Losing Export Game.
Rarely does the world hear Of export re-
strictions. but everywhere are import OBJ
stacles. Manufacturers farmers and work.
ers demand tarih protection. The clanaor
to sell Is loud; the willingness to buy incon.
spicious. SO long Is exporters individually
are paid, they do not seem to care whether
the nation as whole Is paid. They do
not always realize that the exporters may
be paid with American money loaned to
foreign sellers Of securities or EXCHANGED
for foreign metals we do not need that
while they gain, all Of us may lose Better
to sell our goods for something we need
and can use, than for risky bonds or cast
off silver.
Goods for goods is the basis of the trade
agreements idea In this program Secretary
Hull sees in it an opportunity to advance
the cause Of peace. Through economic in
terchange and cooperation, he says, the
opportunity is presented for all nations to
live satisfactory type of life and so foster
the wish for peace. The program is also
indorsed by Secretary Wallace, who favors
larger imports Of selected products to slim
ulate our sales Of cotton, wheat and pork
products.
The trade agreements program involves
simply bilateral tariff reductions and the
binding OF existing duties against increase
during the life Of the agreement. BY re-
ducing trade barriers it tends to make i'm
ported goods cheaper, hence more salable.
1t embraces the most favored nation prin-
ciple, and 30 tends to spread its influence
in widening circles
When the pending negotiations with
Great Britain are included, 4 feather will
be added to Secretary Hull's cap Exactly
how big feather it will be remains to be
seen when we learn how important the
concessions made on both sides are to be
and what commerce results.
II Countries Sign Pacts.
Thus far II countries, representing one
third Of our foreign trade, have entered
trade agreements with us, one in April, twS
last year, and IA previously. Much effort
has been put into this program and the
Government processes satisfaction with
the results. According to the Commerce
Department, In 1896 and 1887 the gain in
our exports to Enlargement countries
exceeded the gain in exports to all other
countries. This was true, also, of our i'm
ports in 1896, although 1t was not true of
imports in 1897 because of exceptional
demands. for certain industrial materials
and deficit farm products"
While it is regrettable that no other
country has followed our example in
adopting the trade agreements approach
to its foreign-trade policy this program
has been valuable as q counterweieht to
the quest for -sufaciency, with its eco
nomic distortions and political implica-
tions. Whether these American trade
stimulating efforts are sufficiently heroic
to really lessen the forces making for an.
other major war may be questioned.
Inconsistent Policies.
So far as 1t goes the trade-agreements
program applies an intelligent approach
to an exceedingly difhcult problem. It
seeks to balance merchandise exports with
merchandise imports, rather than with i'm
ports Of bullion or securities. Yet the same
administration which with one hand ap-
plies this intelligence to trade stimulation
with the other gives US for the same pur-
pose devaluation and the silver program.
whereby we balance merchanised exports
with heavy imports Of q perfectly useless