The Auckland Star: WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun. MONDAY, JUNE 19, 1933. LOWER TARIFFS.

Auckland Star, Volume LXIV, Issue 142, 19 June 1933, Page 6

The Auckland Star: WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun.

MONDAY, JUNE 19, 1933. LOWER TARIFFS.

'.For i7ie cause that lacks assistance, For the icrong that needs resistance, For the future in the distance, And the good 'chat we can do.

There are two ways open, to reduce tariffs—the system of reduction by percentages and that of reduction to a common level. It is the former that the United States adopts in its proposal to the "World Economic Conference. A 10 per cent reduction as favoured by America would make possible a substantial easing of tariff barriers, but there is this to be said against it, that the differences

in tariff levels between different countries will still remain, and that the United States, as compared with Britain, will be still a highly-protected country. For many years policy in America was so definitely along Protectionist lines that the issue had little political significance, and the American public regarded high import duties and prosperity almost as synonymous terms. So deeply rooted was this idea that -when the depression set in it Avas thought that here the United States possessed a -weapon sufficiently powerful to save it from the distress experienced in Europe. The course of events, however, has taught America, like other countries, that tariffs have a limited value, and that if they are used to bolster up a trade balance there may be serious reactions. It was as impossible for the United States as for any other nation to continue to sell abroad on the same scale if she were determined to buy less. So trade fell off, and with its fall there was an enormous drop in the revenue collected on imports. In New Zealand it may lie difficult to appreciate fully what this has meant to the United States, for our Customs revenue has been comparatively buoyant in the past year, and our manufacturing industries rely on the tariff only to safeguard their position in the home market, whereas in America protection in the home market has been linked with expansion in export trade. It is easy to appreciate that if trade were restored to its former volume, the immediate sacrifice involved in a 10 per cent cut in tariffs might be offset many times over by the gain from a larger turnover. If, as is hoped, a reduction in tariffs will bring about rapid improvement in the demand for foodstuffs and raw materials, this American suggestion at the Conference is of great moment to us. A plain indication that New Zealand favours the removal of excessive barriers to trade was given *to the Conference by Mr. Forbes in denning our policy.