JULY 2, 1957
NEW YORK—A communication I have received from the director of programs of the U.S. Council of the International Chamber of Commerce emphasizes that one of the key steps to be taken by the United States at this time is joining the Organization for Trade Cooperation.
The President has strongly endorsed the formation of OTC whose purpose is to "make certain of the protection of our own life as we try to advance the whole theory of better world trade all around the globe."
I have, too, a letter from an individual complaining bitterly of the lack of understanding about foreign trade problems. The writer says he always has been in favor of trade with other countries but objects to the recent trend of our big industries in building factories in foreign countries to take advantage of cheap labor.
Of course, most countries with a labor surplus and low wages have weak labor unions. These nations, however, want American capital to build factories in their countries to give their people employment. But it is evident that to flood the American market with goods produced by cheap labor and, therefore, at a price considerably less than if the goods were produced here is unfair competition.
The International Labor Organization, however, has long been trying to raise the standards for labor all over the world to an equal basis so it could slowly wipe out unfair policies.
In the past there was some truth in the contention that American machines and industrialization could equalize the advantages of cheap labor. But now, when these machines are shipped overseas for use either by our own or foreign industries, an effort is being made to take advantage of both modern machinery and cheap labor.
The Japanese and the Germans today probably are approaching as great a skill in the use of machines as we have in this country, so automation will come to them as quickly as it would come to us.
I don't know whether the OTC can take these things into consideration and make a better trade picture and at the same time not make it difficult for small American industries to exist in competition with the large ones, both in this country and the rest of the world. The thinking on these subjects will have to include world trade as a whole.
We now are trying to compensate to Japan for the loss of its old trade with China. It may well be that the trade between China and Japan is essential to the existence of many small industries in the U.S.
I was much interested in this letter from a small businessman, and I agree with him that the whole question of world trade needs more careful study than we have given it in the past.
There is no question in my mind but what we should support every effort of the ILO to equalize working conditions so that there cannot exist in any country labor so cheap that no amount of skill and know-how in another country can overcome the difference.