Evening star., 1952-09-01
NATO and Unbalanced Trade

In his first report to the President since
becoming United States Special Representative In
Europe, Ambassador William H. Draper jr has
spoken out with commendable vigor and frank
ness against the dangers inherent in a do-nothing
attitude toward the problem Of unbalanced trade
between our own country and the rest of the
free world.
The problem revolves primarily around the
fact that the United States is exporting to
overseas lands about five times as much as 1t
is importing from those lands. This great imbal-
ance exists chiefly between us and the nations
of Western Europe including Britain. Owing to
a number of causes-not least among them being
our tariff barriers-these members of the North
Atlantic Treaty Organization cannot earn
enough dollars to pay for all the things they
must get from us to keep their economies going.
This situation which is further complicated
by the Western ban on shipping strategic goods
to the Soviet Union and its satellites has existed
in more or less acute form ever since the
Second World War dislocated the free economies
of Europe and disrupted the normal pattern of
international trade. From year to year. to help
our friends abroad cope with their dollar short
age, we have extended to them billions in direct
loans and such other aid as the Marshall Plan.
That has enabled them to finance their vast
amounts of imports from us, but it has not
enabled them to pay their own way. They
have things to sell to us to earn the income they
need to buy from U.S. but we have restrictions that
discourage their sales
Accordingly, if the dollar gap between us and
friends is to be closed or if the need for huge
sums of American aid is to be eliminated in the
foreseeabe future, it is imperative that strenuous
efforts be made to do away with or drastically
reduce the existing trade imbalance This is
something that can be more easily said than
done, but the difficulties involved are by no
means inSurmountable. solution can and will
be found if all parties concerned make up their
minds to find it. To that end, as Mr.. Draper has
reported to the President, probably the most
important single requirement is American recog
milton of this simple truth: That to maintain our
present volume of exports, which is factor Of
very large Importance to our own prosperity,
and at the same time to be paid in full, we must
greatly increase our imports.
However, as Mr.. Draper has emphasized
such an increase-which cannot be achieved in
industry-does not in itself offer a full solution
to the dollar-gap problem. Action along other
lines is needed as WELL Much can be gained
for example, by more vigorous investment OF
private American capital in overseas enter
prises. And one of the biggest requirements of
all is that the Western European nations, with
projects like the Schuman Plan for merging coal
and steel resources, move as swiftly possible to
break down their mutual trade restrictions,
increase their productivity, and integrate their
economies to promote greater efficiency and
steadily rising living standards throughout q
free Europe capable Of supporting itself.
MF. Draper has not exaggerated In declaring