AMERICAN TARIFF POLICY

Otago Daily Times, Issue 22205, 7 March 1934, Page 6

AMERICAN TARIFF POLICY

President Roosevelt's request to Congress for authority to modify tariff rates in negotiating commercial agreements with other nations will not cause any particular surprise. Thi3 inauguration of what he calls a tariff bargaining experiment will be regarded, however, as more or less an admission that in the United States the protective system has been carried to inordinate lengths bringing in its train more harm than good. That body of American opinion which has consistently opposed the imposition of excessive arbitrary restrictions on the world of commerce, operating as a virtual embargo, will now find a belated satisfaction in observing that to an extent at least the force of their protests and warnings is recognised in administrative circles. It was said at the time of the passage of the Hawley-Smoot tariff Bill in. 1930 that it closed one more chapter of the long and turbulent tariff history of the United States and inaugurated another not less turbulent. A close and searching analysis of the effects 'of the policy involved in actually conducing to trade depression would no doubt be interesting. While the protective system had become peculiarly identified with the United States in the course of a century and a-half, the Hawley-Smoot provisions reached the highest: protective level of any tariff law ever passed. It is part of President Roosevelt's recovery plan to bring about a .restoration of America's foreign trade. Apart from the measures taken under that plan to improve the country's domestic conditions, there still remains for th,e United States the problem- of dealing with tariffs in relation to her. position as a great creditor country. When speaking as a candidate, for the Presidency Mr Roosevelt, in a reference to war debts, declared, " The Republican .position has been the absurd one of demanding payment and at the same time making payment impossible." He urged that unless the procedure thus involved were reversed throughout the world there was no hope for full economic recovery or for true prosperity in the United States. As President Mr Roosevelt has not used quite the same language. But circumstances have made it more apparent than ever that a creditor nation cannot be paid for goods and services unless it accepts payment in goods and services. The President's request to Congress now seems to indicate that recognition of the need for dealing with the tariff question in the light of the financial and economic outlook for the United States is to be no longer postponed, A country which, like the United. States, has shown a spirit of antagonism towards international trade in making extraordinary concessions to the demand that nothing that could be made internally should be purchased from abroad, while at the same time it has insisted on the encouragement of exports ry artificial measures, is bound sooner or later to discover the unsoundness of its policy. The Secretary for Agriculture for the United States has made it clear" that in his opinion that country must co-operate with other countries in the exchange of goods if she wishes to be a factor in international trade. He has emphasised that if the United States desires to sell abroad she must buy from abroad, and that a creditor country must buy more than it sells. In one of his recent messages to Congress President Roosevelt affirmed: "All of us are seeking the restoration of commerce in ways which will preclude the building up of large favourable trade balances by any one nation at the expense of trade debits on the part of other nations." The disorganisation of world trade has been one of the most difficult features of the depression. The spirit of economic isolation, from whatever causes it may arise, tends seriously to check world recovery and progress. The Administration at Washington now sees other Governments, notably that of Great Britain, negotiating trade agreements and doing'something practical to promote international trade, and it, too, is moved to concede the advantages of a. policy of reciprocity to the extent of modification " within carefully guarded limits " of existing duties and import restrictions, its hope being that American agriculture and industry may benefit.