POLICY OF AMERICA

New Zealand Herald, Volume LXX, Issue 21540, 11 July 1933, Page 11

POLICY OF AMERICA

ISOLATION ATTITUDE INDUSTRIAL RECOVERY ACT SOCIALISTIC TENDENCIES The point of view of the United States and its bearing 011 the World Economic Conference and the world problems were described in an addressgiven at the Auckland Rotary Club's luncheon yesterday. The speaker was Mr. W. H. Hemingway, formerly of Auckland, who has spent the last 10 years in the United States, chiefly in New York. His subject was. "America and a Policy of Comparative Isolation." He dealt with the reasons why. America had adopted this policy, what she was doing in this direction and what the effect was likely to be. It might seem strange, ho said, to people brought up with the broad British outlook that anyone should today advocate national isolation, but

he could assure them that it was common for responsible leaders in the United States to do so.

Speaking of Professor Raymond Moley, of tlis University of Columbia, whom President Roosevelt sent to the Economic Conference, Mr. Hemingway said he heard something of Professor Moley when holding seminars himself / at the School of Banking and Business Administration at Columbia and he gathered Professor Moley was something of a radical. He was a yotinc man—about 46 years of age—and belonged to the new school of social thought. Professor Moley was said to be a "little American," which meant he believed in "America for the. Americans," or, as William Randolph Hearst put it, "America First," which .expanded meant, "America first, last and all the time." In practice this would lead to a policy of economic isolation for the United States. " Revolutionary Measures "

President Roosevelt's Industrial Recovery Act, just passed, was but a short Statute yet it contained some of £ha most revolutionary measures 6ver adopted outside of Russia. The preamble to the Act describes it as a measure "to encourage national recovery of industry and to foster fair competition." It stated specifically that the Act was not to be construed as .being in conflict with the existing Anti-Trust Laws (the Sherman and Clayton Acts) and it permitted the organisation of / industry for the purpose of co-opera- \ tion among trade groups and induced and maintained united action of managements and of labour under Federal sanction and supervision. It empowered the President to establish industrial planning agencies and to prescribe codes of fair competition for any trade, industry, or sub-division thereof.

The President might also prescribe rules for the keeping of accounts and records and for the due and regular filing of returns and reports to the Government. Henceforth no person or company might enter into, or carry on, business affecting inter-State commerce without obtaining a Federal licence. Rates of wages, hours of work and prices might be regulated under the Act. Being an emergency measure the Act was to remain in force for two years, unless the President, or a joint resolution of Senate and Congress, decreed otherwise. Penalties in the way of fines and/or imprisonment for disobedience to the Act were imposed.

New Economic Era The passing of this Act made possibly the beginning of a new economic era for America, one in which individual trades and industries would be encouraged, if not forced, to integrate, organise and regulate themselves under a growing measure of Government direction and supervision. The Act permitted private ownership and operation, but under strict Government" plan- x ning and control. If this legislation succeeded, America would have gone further than any country in the world with the exception of Russia toward the socialisation of industry. Individual unit competition was to be a» thing of the past. Trade and industry were to have Government advisory councils. National policy was to move 60 that each trade and each industry, was to be an integrated unit, with production limited, wages and working hours settled, and within limits, price levels fixed. Would it succeed? Who could say? "If it fails," the Kiplineer Ser-' vice of Washington warned thev American public, "then the next step is Communism." Discussing the effects of American isolation on the rest of the world, Mr. Hemingway said:—"lf the United States does decide to fall back on a policy of comparative isolation—and I say 'comparative' isolation, for, of course, no nation can in this 20th century remain absolutely isolated—it will go hard with those American industries (and they make quite a number) which, by reason of their production being so much in advance of domestic requirements or consumption power demand that America must export. What also of those imports that America must secure from abroad, for instance, rubber, tin, silk, nickel.

tea, coffee, to mention but a few? "Observe that even in these days of high tariffs the United - States allows 66.2 per cent of her imports to come in duty free. Never forget that fact.

even though you recall that on the remaining 33.8 per cent of imports America imposes on an average a tariff of 46 per cent. Effect of Isolation '"Suppose America does decide to shut herself off from the rest of the world for a time. What would be the effect? She might export nothing, but sho would still have to import those commodities enumerated, for they are essential to modern civilised life. For years now the war debt payments have assisted to give America a favourable trade balance and have helped to throw foreign trading transactions out of gear, but, in the new circumstances, how long would they continue to do so? Not for long. In a comparatively short time the present-day debtor nations would become creditor nations of the United States —the balance of trade would begin to operate in their favour. Add to this a development of the arbitrage of exchange, and which great Britain in particular might uiako use of, and we should soon have I a flow of gold from America. The old I cycle would commence to go round once more and prosperity would soon return to the world. Such would be tho inevitable result in time if America decides on a policy of comparative isolation. "I for one shall not lose any sleep if America does draw out of the iiconomic Conference," said Mr. Hemingway in conclusion, "and go in for a policy of economic isolation." , . When Mr. Hemingway was being thanked for his address it was pointed out to him that not only had the club asked him three tunes to apeak to them, but had paid him the father special compliment of breaking one of its most sacred rules against e*tending a speaker's tune*