Evening star., 1941-05-11
Commerce Aide Sees
Peril 70 Economy
# Germans Win
Warns Of Lower Living
Standards, Limits on
Free Enterprise
By OLIVER MCKEE.

BY OLIVER MckEE.
II Germany wins the war, and the
Nazis carry out their postwar plans,
the repercusSions on United States
economy would be far-reaching and
serious, the Department of Com
merce declared yesterday.
Writing in the current issue Of
Foreign Commerce Weekly. Louis
Domeratzky, chief of the European
unit of the division of international
economy, warned that the Nazi pro-
gram would lower American living
standards, draSticallv narrow the
field of free enterprise, put all
countries in the Western Hemi-
sphere under pressure and force the
United States into policy of self
sufficiency involving degree of
economic planning that might seri-
ously affect some of our funda-
mental political institutions"
Though Mr.. Domeratzky does not
mention the recent articles of John
Cudahy, former Ambassador to Po-
land, officials of the department, it
was disclosed yesterday, believe that
the latter has not given complete
picture of NaZi postwar plans, and
that he has failed 10 indicate the
full implications to the United
States of a Nazi-dominated Europe.
Self Sufficient Europe.
From the numerous official and
semiofficial statements published
within the past few years, the eco
nomic order which Germany is try
ing to establish is now quite clear,
Mr.. Domeratzky declared. This Or
der envisages a self-Sufficient Eu-
rope, economically and politically
dominated by Germany, and the
continuation of state-controlled
economy after the war.
In the new European order, there
will be no room for gold as none
tary metal. This attitude toward
gold can be easily explained by
number of factors growing out OF
German economic history since the
World War and also by the fact that
the decentralization of gold is ex-
pected by the Germans to injure
the democratic countries more than
the totalitarian," Mr.. Domeratzky
explained.
Under the Nazi post war program,
most international trade will be
carried on through clearing agree
ments. with Berlin as the center, and
the reichSmark the basis of foreign
trade. Other objectives include in
creased participation of German
capital in industrial and other
enterprises in the neutral and oc-
cupied countries of Europe, and the
control of ports, shipping lines, dis
tribution channels and insurance.
"If Germany should be in posi-
ton to carry out an essential part
OF these policies, and secure the
economic cooperation of the domi-
nant power in the Far East, we may
expect not only substantial mar
rowing of the field for free enter
prise, but also fundamental
change in the conditions under
which we shall have to carry on
foreign trade, with probably serious
repercussions on our domestic
economic situation Mr.. Domeratzky
pointed out.
Confronted by a compact pollt-
ical-economic combination on the
continent of Europe under the
domination of the National Socialist
State, the individual American en-
trepreneur would hardly be strong
enough to find a market for his
product or service except on the
terms laid down by the dominant
country. 1t would be impossible for
him to make any plans for export
or import without previous agree
ments with German, or
German-controlled continental Or
ganization.
I'm view of the close tie-up
between the government and in
dustry in Germany, it is hardly
likely that foreigners would be al
lowed to retain control over their
direct investments in Germany in
volving essential industries, and it is
therefore to be expected that, If
Germany should be victorious, many
OF the American branch factories in
Germany, and perhaps in some
other continental European coun-
tries, would have to be transferred
to German interests"
Pointing out that there is every
reason to believe that in the event
of a Nazi victory, access to some raw
materials essential to our industries
would be controlled by German
dominated organizations. Mr.. Domer-
the United States to help supply
many of Europe's raw-materials
needs. The basis would probably |
be a combination of credit and some |
form OF barter. but the trade would |
be strictly controlled on the Euro
pean side, and might, therefore. ne
cessitate corresponding controls on
our part. There would be. in all
proba ability. a definite control of the
shipping and insurance facilities
A similar appeal would also be ad-
dressed to other American countries.
Concluding Mr.. DomeratSky said,
"While it is impossible to foresee
all the economic and social reper-
cussions of the German plans, 1t Is
safe to predict that, if consummat-
ed. they would bring about an &C
celeration in the tempo of economic
change in the United States. and
might force us unto policy of self
sufficiency, involving temporarily, at
least, lowering of our living stand
ards. A German success would un-
doubtedly necessitate more funda-
mental changes in our agricultural
production on more or less perma-
nent basis. 1t would lower the ef-
f1ciency of some of our industries
by curtailing the prospects OF ex-
ports and thereby reducing the rate
Of utilization Of plant capacity.
IF it should also restrict our &C
cess to foreign raw materials suf-
f1ciently to justify our resorting to
artificial substitutes. it would mean
a higher raw-material cost for our
industries as we'll as reduced pur-
chasing power and therefore, a