Evening star., 1940-01-11

DEFENDS TRADE PACTS-Se,
Means Committee hearing on !
covery was to be attained and eco.
nomic progress resumed.
The disruption of internationa
trade, which brought on the col
lapse of our domestic economy a!
well, resulted primarily from the rist
Of excessive and unreasonable trade
barriers. These were of two types
First, higher tariffs, embargoes
quotas, import licenses, exchange
controls and numerous other device!
for preventing imports from abroad
and second, various types of dis.
elimination, which caused a diver.
sion of much of what remained o1
international commerce into unnat.
ural and abnormal channels. Oul
exports had suffered heavily from
both of these types of trade obstruc-
tions. Our sales abroad fell from
So billion dollars in 1929 to 16 bill.
lions in 1882. The exports of othel
countries to us had suffered heavily
from the excess of our protectionism
Our foreign trade could be restored
only through reduction of these
excessive barriers here and abroad
Three Courses of Action
Were Open to U. S.
To accomplish this end, three
courses of action were open to us
Cd We could attempt to secure
agreement among a large number
of nations for a reduction of trade
barriers. co We could lower our owr
tariff in the hope that other coun-
tries would do likewise. Or 90 We
could negotiate mutually beneficial
trade agreements with individual
countries, based upon a reciprocal
reduction of excessive trade bar.
riers
The first of these methods, under
the conditions which prevailed, wa.
impracticable. The second held NJ
certainty of effectiveness, since i,
offered no assurance that other
countries would also move in the
direction O. reducing trade barriers
or trade discrimination. The third
was the only practicable method Of
securing these results. It was the
method we adopted, the methoc
embodied in the trade agreement.
program.
The action Of the Seventy -thire
Congress in enacting the trade
agreements program was based or
the following line of reasoning:
Exports and imports are interde'
pendent; nations cannot sell with
out buying. The promotion of ou
exports cannot be divorced from tn
treatment we accord to our imports
and vice versa. To induce other ma.
tions to mitigate their excessive OBJ
structions to our exports We must, o
necessity, stand ready to adjust ou
own excessive trade restrictions. II
world caught in net of complel
and complicated trade barriers, in ,
world in which other government
possess means of swift action TO-
dealing with these restrictions, 1
was obviously necessary for the leg
islative and the executive branche
of our Government likewise to CO.
operate in order to provide tn
means of dealing with the emer
gency.
Basic Ideas Translated
Into Trade Treaties.
These basic ideas were translated
into the Trade Agreements Act. B.
empowering the Executive to pro
claim notifications of tariff rate
and of other methods of regulating
imports through the negotiation o
Executive agreements which pro.
vide for improved treatment o
our exports by other countries, tn
Congress recognized the necessit.
for an emergency agency to dea
with a grave emergency condition
and created an instrumentality o.
swift and effective action on ou
part for the promotion of our foreign
trade, admirably suited to the spe
cial needs of a disturbed world. II
doing this. the Congress CAREFUL,
defined the policy, the methods AM
the limitations of the reciproca
trade agreements program and thel
entrusted to the Executive the dut
and responsibility of administering
and carrying into effect the provi
sions of the Trade Agreements Act
These instructions of the Congress
were so faithfully carried out, an
subsequent events so fully vindicate
the eminently practical and con
structive nature of this method O
solving a pressing and difficult pro
blem, that the Seventy-flfth Con
gress in 1887 extended this author
ity and responsibility for anothe
three-year period.
We are now approaching the en-
of this second period. Your com
mittee begins today the consider
alton of the next step. That mex
step should, obviously, be examine
in the light of past experience, q
well as of the outlook for the future
I should like, if I may, to place be
fore you my thoughts with regard t
both of these aspects of the problem
The trade agreements prograr
was enacted for the express puI
pose of expanding our export
through the reduction of trade bar
riers in other countries. I subm
that it has done so.
We have concluded 20 reciprocs
trade agreements. The countrie
with which agreements are now 1
effect represent about go per cent {
our total foreign trade. In thes
agreements, valuable concession
have been obtained for literal
hundreds of our agricultural an
non agricultural products. 1mpol