Evening star. [volume] (Washington, D.C.) 1854-1972, 1959-10-12
Trojan Horse Trade


ernor Rockefeller's world trade speech
may be looked upon as his opening bid
in the game of demonstrating ability to
cope with the Russians. However, this
address to the New York Board of Trade
was not purely political speech. 1t was
also a serious and informative discus
sion of the problems inherent in East
West trade.
Governor Rockefeller led of with
the proposition that a settlement of
RuSSia'S lend-lease account, as sug-
gested by the Eisenhower adminiStra-
ton, would not be an adequate basis
in itself for an increase in. trade with
the Soviet Union. Other essential pre-
conditions, he argued, should be pay
mentS by the Russians in convertible
currency and abandonment of such dis
criminatory practices as dumping and
artificial pricing. LET me point out"
he said, that on the present basis any
increased volume of Communist trade
will add in direct ratio to their power
to disrupt and dominate world trade by
Trojan Horse tactics. Therefore, be-
fore we Jump to quick conclusions about
the advantages to Free World countries
of expanding their trade with the Com
munist bloc, it is relevant to ask: Under
whose terms of reference is such trade
to be conducted?'"
The Governor pointed out that in
recent years total trade among the Free
World nations has been about 10 times
the total trade among the Communist
bloc countries. Furthermore, East-West
trade represents only about percent
Of all Free World trade, but constitutes
about 80 percent Of the total foreign
trade of the Communist bloc This being
so, he urged that the tail not be per-
mitted to wag the dog, and that any
expansion of EaSt-WeSt trade be condi-
toned on Soviet adherence to the estab-
lished pattern and rules of world trade.
Otherwise, he warned, the Free World
may find itself in serious trouble in
another 10 years.
In all of this, of course, the big
problem is how to bring the Russians
into line. If, for their own political ?
purposes, they continue to offer to sell
needed commodities at rugged prices
which are lower than the going rate,
how is this strategy to be combatted?
Governor Rockefeller does not
merely raise the question. He also pro-
poses certain utionS-primarily that
the free countries, operating through
GAIT (the General Agreement on Tar
IFS and Trade) and also through other
regional associations, should simply re-
fuse to do business with the Russians
on Communist terms.
This would be the ideal solution if
land it is big if) the non Communist
countries, acting in their own Self-in-
tereSt, were to insist that the Russians
play the game according to appropriate
rules. We have seen, however, that
there is potent lure in a barter deal
or price that arbitrarily undercuts
the going rate. Some nom Communist
nations have responded to this APP
proach, and we suspect that they will
continue to do so. In such event, what
is the proper course for the United
States? Should we hold out for reason
able trading rules, or should we go along
with the appeal for trade expansion,
hoping that the rules of the game will
be Strengthened out as time passes?
AS we read Mr.. Rockefeller's adj
dress, it is strong appeal for the for
mer course. In terms of economic
factors, it is well-reasoned appeal.
International political considerations
are also involved, however, and these,
we think, are given insufficient weight
bV the New York Governor