Evening star. [volume] (Washington, D.C.) 1854-1972, 1948-02-02
1.-The Memoirs of CordeT Hull
Peek's Efforts Against Trade Agreements Act
Beaten in Showdown on German Barter Accord

ant, Harry Mcbride, met me at
Charlottesville, Va, with an urgent
letter from Undersecretary Phillips,
dated December Is.
with q suddenness which was
unexpected" it began, develop
ments have occurred during the last
two days which I know will be dis
tressing to you" It recounted that
on December IL Peek conferred with
the President and thereafter the
White House informed the State De-
partment that the President had ap-
proved Peek's barter agreement with
Germany. Phillips telephoned tho
White House and got promise from
the President that the final word
would not be given until after my
return.
When 7 got back to the State De-
partment my associates and I
arrayed together our arguments
against the German barter deal, and
I presented them to the president.
told him that our trade agree
ments program would be seriously
endangered. Already we had re-
ceived q protest from Brazil with
whom we were negotiating an agree
ment. Brazil, also a cotton ex-
porter, said that if We entered into
a special preferential accord Of this
nature with Germany, she would
be obliged to do the same and to
defer signing the agreement with
us.
Subsidy Fer German Exports.
pointed out that the deal was .
subsidizing of German imports into
the United States.
The deal called for the exchange
of reichsmarks into dollars at the
old gold-dollar rate. This meant
undoins. so far as Germany was
concerned, the devaluation Of the
dollar.
Our cotton exporters, I said. might
not, in fact, be able to get dollar ex-
change for their sales to Germany.
There was no assurance that they
would not be forced to sell cotton at
a loss. Other losses might be SUI
fered by the United States Gov
eminent, through the export-import
bank.
The barter arrangement, I added.
was based on Peek's belief that We
could not otherwise sell the cotton
to Germany. On the contrary, felt
that Germany needed the cotton 80
badly that she would buy at least
100000 bales and find dollar ex-
change with which to pay for them.
Over and above all these argu-
ments Of details was the fact that
the deal was one Of discrimination,
not of equality Of treatment. Every
German export to the United States
was thereby given special advan-
tage. and every other country ex-
porting such products to the United
States would inevitably protest and
possibly take reprisals. The Chilean
Ambassador stated to us that, if
German fertilizer were given pref
erential treatment in our market, as
this plan provided, Chile would be
compelled to dump nitrateS here.
Approval OF Deal Withdrawn.
Fortunately, the President saw the
validity of these arguments. He
withdrew his approval Of Peek's
deal. That meant the end, too, Of
Peek's intention to negotiate SINH
lar deals with other countries. From
then on, the new proposals con-
tanned in the trade agreements doc.
trines and programs steadily weak
ened and broke down the Peep pro-
gram.
pointed out to Mr.. Roosevelt that
the first step was to eliminate or
reduce excessive duties which ex-
cluded competition entirely or prac-
tically, or which had been In effect
for considerable time without re-
sulting in domestic production equal
to more than 10 to Is per cent OF
total domestic consumption.
Two months later Peek's office
was abolished. The trade agree
ments program was saved and sub
sequent results fully vindicated our
onrncifioo IN Daek'r idaas
. (copyrisht, 1913, by North American
Newspaper Alliance, Inc.)