MAY 12, 1955
NEW YORK—One constantly sees in the newspapers the suggestion that we ought to increase our trade and decrease aid to foreign countries. But, almost invariably when the crucial time comes not just to talk but to put this feeling into action, practically nobody wants to reduce a tariff that has favored his particular industry!
I received a plea the other day from the Citizens Conference on International Economic Union asking the support of two key bills that are now before the Congress. These bills, HR 1 and HR 5550, would carry out the President's foreign trade program. HR 1 is the Trade Agreements Extension Act of 1955. It would continue the reciprocal trade agreements program until 1958, it would continue the President's power to negotiate for the reduction of foreign barriers to American goods, and it would allow him to make moderate reductions in some American tariffs in return for these foreign reductions.
This does not seem a great deal of power to grant to the President. It is true that any reductions in tariffs probably means that the industries involved have to make some changes. Either they do not make quite such high profits or they must make savings that would make it possible for their profits to continue at the same level.
In some extreme cases it may be possible for some business to vary their production or even to change it. This should, however, only be necessary in cases where obviously an industry is not actually suited to our country's conditions and we can better be served by imports from abroad.
This is rare, indeed, but if it does occur then the government probably should be prepared to help the industries readjust to new conditions, particularly where it is an industry employing a major number of people in one particular locality.
HR 5550 gives the President authority to make the United States a member of the Organization for Trade Cooperation, known as OTC. This organization has one main purpose: that is to provide the machinery to make effective the General Agreement on Tariffs and Trade, known as GATT.
Thirty-four nations are signatories to this agreement. In signing they agreed to follow the code it contains and not to impose unreasonable barriers to the products of their neighbors. It took five months for representatives of the principal trading nations of the world to redraft this agreement on tariffs and trade, and the U.S. took the lead in these negotiations and succeeded in creating a stronger and more effective agreement.
Therefore, the reciprocal trade agreement covered in HR 1 and the free world trade code have become linked together and it is essential to pass HR 1 or we could not remain as members of GATT. That would mean that we were practically inviting trade warfare among the world's free nations. Since we do not want warfare but do want cooperation, HR 5550 is essential.
The President can then make us a member of the Organization for Trade Cooperation. This group will administer the 34-nation agreement, which covers 80 percent of world trade and which has succeeded in maintaining a tariff truce since 1947 and in reducing barriers to trade.
Many amendments have been projected for the two bills that are now before Congress. These amendments are designed to protect certain interests without looking at the good of the whole nor of the far-reaching effects when individuals also will prosper.
I hope the American people will take an interest in this situation because the gradual change from aid to trade will be very helpful.
(Distributed by United Feature Syndicate, Inc.)