Evening star., 1940-02-20

our other means Of transportation,
our banks, our merchandising estab-
lishments and 80 forth. Loss Of
foreign markets leads to .stagnation,
depression, unemployment and gen.
eral distress, which spread through
out the whole domestic economic
system.
Now the value Of exports is said
to be no more than 10 per cent of the
value Of our total production of
movable goods. This statistical fact
leads some people to the dangerous
conclusion that, therefore, our ex-
port trade is not Of any appreciable
importance to US and that its re-
duction or complete elimination
would not hurt us. There Is an in
herent fallacy in this view. believe
1t was ex-President Hoover, as Sec
retary of Commerce, who said that
the exports represented our margin
Of prosperity"
Exports Top Imports In Value.
1t Is obvious that our economic
system Is not organized into two
water-tight compartments, one of
which, representing 80 per cent OF
our productive effort, supplies our
domestic market, while the other 10
per cent works for the foreign mar
ket. II that were the case, we might
be able to lop of the 10 per cent
compartment more easily, If 1t were
desirable to do so, without too much
injury to the 80 per cent compart-
ment. But that is not the case. The
branches of production which pro-
duce exportable surpluses depend
upon export markets for far more
than 10 per cent of their total sales.
and these industries are essential
parts of the whole intricate economic
system. Impairment of these
branches of production through loss
of their foreign markets causes loss
of efficiency throughout the entire
system. Its destruction would be like
man losing the use of one hand. It
simply is not necessary to make that
sacrifice. We have found a way to
maintain at least q part Of our
foreign trade through agreements.
Our imports are usually somewhat
less in value than our exports. We
would not, however, be justified in
concluding, from this smaller ratio,
that imports are of little of no i'm
portance to US. Here again, as in
the case of exports, 1t is necessary
to look at the nature of the things
we import, and appraise their signifi-
canoe in the light Of the necessities
of our economic system. We must
not get away from the fact that some
of the commodities which we i'm
port from abroad are not and cannot
be produced in this country.
It Is with record of achievement
as background that we are going
to extend, for another three years,
the authority to enter into trade
agreements, to maintain and extend
the gains already made, and to
enable this country to meet changing
conditions in foreign markets as they
rise In the coming years. The trade
agreement pact was originally passed
as an emergency depression measure.
We are in another kind of emergency
now. We shall need the flexibility
which the trade-agreements pro-
gram affords as greatly as we needed
it in the emergency of the great de-
preston. What conditions may bring
forth in these future years no one
can foreSee. The countries con-
stituting our largest markets have
unfortunately become engaged in
war. No part of the world will be
able to remain unaffected by this
war. As great neutral Nation we
ought to hold ourselves in readiness
for influencing peace.
We can be sure that our foreign
trade will be profoundly affected by
the war. 1t is to be expected that the
character of our exports, particularly
to belligerent countries, will naturally
be shifted. Some industries will find
their export markets greatly reduced,
others whose products are more es-
sential to war purposes will be
stimulated. This is a condition with
which we must deal. Even our trade
with neutral countries has already
been changed. In some cases we
shall find new export outlets by
filling the gaps created by the ina
bility of belligerent countries to sup.
n1v their former customers In other