STATEMENT OF MRS C. D. WRIGHT, LEGISLATION CHAIRMAN, GENERAL FEDERATION OF WOMEN'S CLUBS, ON THE INTERNATIONAL TRADE ORGANIZATION Two years ago the General Federation of Women's Clubs adopted the following resolution: "Resolved, That the General Federation of Women's Clubs in convention assembled, May 1948, reaffirms its support of the reciprocal trade agreements program and urges renewal of the Reciprocal Trade Agreements Act, which expires in June 1948, for a 3-year period, without crippling amendments; and "Resolved further, That the General Federation of Women's Clubs endorses the International Trade Organization and urges congressional authorization for United States participation therein.” The urgent need in the world today is for peace and economic security. The two cannot be separated. That which reinforces one strengthens the other. The International Trade Organization represents an important step toward expanding world trade and thereby advancing the economic security of the entire world. By gaining world-wide adherence to a code of rules and the procedures and organization for carrying them out, the ITO would firmly establish the democratic, consultative approach to trade problems and-what is most important-it would do this within the framework of the United Nations. World trade today is laced in a strait-jacket of Government controls and barriers. Some were inherited from the prewar days of economic warfare which ended so disastrously in World War II; others arose out of wartime measures, some of which have not yet been eliminated; and still others have developed out of the exigencies of the reconstruction period. Collectively these restrictions threaten to shrink the flow of goods along the world's trade arteries. The Habana Charter, while admittedly not a perfect document, represents a workable means for obtaining a larger and freer world trade. Its basic principles are in accord with those of private enterprise. It will enable private traders to compete more equally with state trading enterprises. It restricts the use of quotas, discriminating taxes and regulations, burdensome customs requirements, state trading regulations, and practices of international cartels. It provides for further negotiations toward reduction of tariffs and the elimination of preferences. Such exceptions as there are to these principles are necessitated by the abnormal conditions of the reconstruction period. It is hoped that most will be gradually eliminated. All are surrounded by careful safeguards to prevent abuse. If the ITO fails to materialize, there is grave danger that present Government restrictions on trade will harden into a permanent pattern which will be difficult to change after the current abnormal situation is corrected. From an American viewpoint such a condition would be serious. First, the continuing downward trend of our exports and the virtual closing of many important markets for our products through import restrictions threaten our prosperity. Secondly, those nations with whom we are most intimately associated in our struggle to secure peace those of the North Atlantic Pact-are even more dependent on foreign trade than we. To them foreign trade means the difference between recovery and depression, between being an asset in our collective efforts to maintain peace, or being sick countries beset with economic ills and social unrest. It is decidedly in the interest of the United States to support the efforts of western Europe to improve its trade so that it can stand on its own feet after ERP aid terminates. Of the agencies now operating to bring about world recovery, most depend in large measure on the establishment of the ITO. The European Recovery Program can restore European production, but it cannot create the necessary world markets to which Europe's goods must flow. The International Monetary Fund, the World Bank, the Food and Agriculture Organization, and the General Agreement on Tariffs and Trade all require activation of the ITO to pursue their aims successfully. Contrary to misunderstanding in some quarters, the ITO would not, in our opinion, be a "super state" to which the United States would be obliged to delegate its economic sovereignty. The basic power of the ITO is that of determining whether member nations are living up to their obligations under the charter. Since these obligations are essentially those of loosening the restrictions placed by governments on foreign trade, the powers of the ITO are no cause for fear. Finally, it is of great psychological importance that the United States ratify the ITO Charter. Not to do so would accentuate the deep-seated fear abroad of a possible reversion on the part of this country to its former isolationism. To do so would help to assuage such fears. It would generate confidence in the continued determination of the United States to cooperate with the rest of the free world in building the economic security which is basic to lasting peace. For the above reasons the General Federation of Women's Clubs respectfully urges the Congress to give early approval to House Joint Resolution 236. NEW YORK, N. Y., April 28, 1950. Subject: Opposition to adoption of the ITO Charter. United States House of Representatives, Washington, D. C. GENTLEMEN: The attached brief, which I read to the Ways and Means Committee 3 years ago, is devoted almost entirely to criticism of the ITO Charter. This was printed in the records of the Ways and Means Committee at that time. Since you are conducting hearings now on this same subject, I ask you to incorporate this brief into your present records. If more copies are needed, please let me know. Thanking you in advance, I am Very truly yours, BRIEF L. B. PLATT. Now that the United States is adopting the policy of preventing communistic aggression and expansion everywhere and the State Department at Moscow has told Russia that we will not see Greece and Turkey fall unwillingly under Russian domination, why should we appease communism at the Geneva Conference? The ITO Charter as now proposed is in the form of an appeasement to communism because it requires the United States to become a collectivist state. It does not require communistic states to become democratic in foreign trade, as might be expected since we are supposedly the leaders in democracy, but it changes our form of commerce to match dictatorships. Through the United Nations our economic planners can dictate production, prices, and even employment in the United States and can dictate exports from the United States. It will continue our planners in office in an even more glorified position. They will have been promoted from United States planners to UN global planners, exercising more control over our business than at any peacetime period in our history including the Blue Eagle period of NRA. This is not decontrol which President Truman professes to favor but a renewal of controls by the do-gooders and pinks in our Government. Chapter VII of the ITO Charter as printed by the State Department in December 1946 sanctions the adoption of intergovernmental commodity agreements in critical periods to regulate production, trade, and prices. For instance, article 27, paragraph 2 (a) says: "Wherever practicable, global quotas (whether allocated among supplying countries or not) should be fixed, and notice given of their amounts Paragraph (b) says: * "Where global quotas are not practicable, import restrictions may be applied by means of import licenses Paragraph (c) says: * "Import licenses or permits which may be issued in connection with import restrictions (whether or not within the limits of global quotas) shall not, save for purposes of operating quotas allocated in accordance with subparagraph (d), require or provide that the license or permit be utilized for the importation of the product concerned from a particular country or source." Paragraph (d) says: "In cases where these methods of licensing are found impracticable or unsuitable, the member concerned may apply the restrictions in the form of a quota allocated among supplying countries. In that event, the shares of the various member supplying countries should in principle be determined in accordance with commercial considerations, such as, e. g., price, quality, and customary sources of supply. For the purpose of appraising such commercial considerations, the member applying the restrictions may seek agreement with respect to the allocation of shares in the quota with all other members having substantial interest in supplying the product concerned. In cases where this method is not reasonably practical, the member concerned should allot, to members countries having a substantial interest in supplying the product, shares based upon the proportions of the total quantity or value of the product supplied by such member countries during a previous representative period, due account being taken of any special factors which may have affected or be affecting the trade in the product." They will control business one way or another. And the critical period can be extended every 6 months. And the planners can manufacture critical periods almost at will. The Brain Trust was proficient at this. Section E. State trading-article 31. Nondiscriminatory administration of state-trading enterprises says: "1. If any member establishes or maintains a state enterprise, wherever located, which imports, exports, purchases, sells, or distributes any product, or if any member grants exclusive or special privileges, formally or in effect, to any enterprice to import, export, purchase, sell (distribute, or produce) any product (and exercises effective control over the trading operations of such enterprise), the commerce of the other members shall be accorded treatment no less favorable than that accorded to the commerce of any country other than that in which the enterprise is located in respect of the purchase or sale by such enterprises of any product. To this end such enterprise shall, in making its external purchases or sales of any product, be influenced solely by commercial considerations, such as price, quality, marketability, transportation, and other terms of purchase or sale, and also differential customs treatment. The member maintaining such state enterprise or granting exclusive or special privileges to an enterprise shall make available such information as may be appropriate in connection with the consultation provided for in article 35." Can you see Russia opening her real set of books to give any reliable information? Our world planners in the State Department would make us over into a collectivist state in order to compete with Russian totalitarian imperialism instead of fostering trade agreements only with those countries still allowing free enterprise; and instead of utilizing our concessions as inducements for Soviet and other dictatorships to remove the shackles from their businessmen. This, I submit, is appeasement at Geneva to Russia at the same time we have tried to make a show of force at Moscow to support the Truman Doctrine. If this doctrine is to succeed it should be supported by all branches of our Government and not undermined by the Assistant Secretary of State and the technical staff within the Government of the United States which has been fostering this ITO charter. Not only would our world planners in the State Department dictate these international rules which stifle free enterprise in world commerce, but they would go further. They would dictate our domestic production. If one of our industries were "overexpanded" these planners would close it down and shift the facilities and manpower to "new and productive occupations." The ITO charter says so in article 47 as follows: "The members agree that intergovernmental commodity arrangements may be employed to achieve the following objectives: 3. To provide * * measures which will have as their purpose economic adjustments designed to promote the expansion of consumption or a shift of resources and manpower out of overexpanded industries into new and productive occupations." There is no doubt that "overexpanded" means that world production of an article is overexpanded so that if, for instance, shoes made in Czechoslovakia were in abundant supply and cheaper than our own, we should close up our shoe factories, shift the employees to Michigan and have them make automobiles instead of shoes. This, of course, assumes that our autos will still be the best and cheapest in the world. Only hugh mass production industries could survive here. The small capitalist would have to go under in the face of products made by cheap foreign labor. In paragraph (4) of the same article (47) the world planners would also control our domestic prices for it states: "To moderate pronounced fluctuations in the price of a primary commodity above and below the level which expresses the long-term equilibrium between the forces of supply and demand.” Russia is not the only communistic state among the nations which the State Department intends to include in reciprocal trade agreements. Among the 17 nations we are now conferring with at Geneva is Chile which has a communistic government. China has a revolution on the subject. Brazil has 130,000 Communists in a dominant position: Cuba has 153,000; France has its share, as you know, and is on the verge of upsetting its Government on this account. All these countries are to be favored by our largess, our open door, our friendly hand, and our leadership in the State Department's proposals for expansion of world trade in the shape of the ITO charter. Our own markets are the envy of the world. The United States dollar is the only stable currency remaining on the face of the globe. All other nations and peoples want to sell us their goods to obtain our dollars. Would it not be the easiest thing in the world for the foreigners to obtain the sympathetic ear of our do-good planners? It means glorified economic planning jobs forever for the theorists. Why shouldn't they welcome this world cartel scheme with open arms? Why shouldn't the planners put on a big show for the adoption of this global scheme? Have you ever questioned what the 100,000 publicity experts of the new deal are up to? Their theme is the same, self-preservation in office for themselves and for the new deal. Under the guise of freer trade and lower tariffs for better world cooeration, the experts have struck such a responsive note that the majority in Congress believes that this peace plan represents the only plan worth considering and is too popular to oppose. The State Department through these experts are printing reams of publicity to sell this plan to control commerce, carefully covering up the collectivist provisions. For example, when the State Department submitted its preliminary draft of the charter for the ITO as of December 1946 to these hearings before this Committee on Ways and Means on March 26, it carefully deleted eight pages entitled "Summary of Provisions." You can ascertain this by referring to page 81 of part 1 of your printed transcript and supporting evidence, where the index of contents of this document shows Summary of Provisions as occurring on page III. You will find that there is no such page in your transcript and that these eight pages have been omitted from the document which is Publication No. 2728, Commercial Policy Series 98, printed by the United States Government Printing Office. Page V of the official document reads as follows: "CHAPTER IV. ECONOMIC DEVELOPMENT "Chapter IV recognizes the importance of bringing about the industrial and general economic development of all countries, particularly underdeveloped countries. Accordingly, members would undertake to promote their own development and would agree to cooperate, through the Economic and Social Council of the United Nations and by other means, to promote industrial and economic development generally. Members would agree on the one hand not to put any unreasonable restraints on the export of facilities, such as capital and equipment, which are needed for the economic development of other countries, and, on the other hand, not to take any unreasonable action injurious to foreign investors who are supplying facilities for development. It would be recognized that governmental assistance, including protective measures, may be needed in some cases to promote the establishment of particular industries; at the same time it would also be recognized that the unwise use of protection will frustrate sound development and damage international trade. Protective measures which run contrary to the provisions of chapter V of the charter (relating to the relaxation of trade barriers) may not be used except with the specific approval of the Organization (the world planners) and, in appropriate cases, with that of countries whose trade may be directly affected." Page VII of this true copy reads as follows: "CHAPTER VII. INTERGOVERNMENTAL COMMODITY ARRANGEMENTS "Chapter VII recognizes that in the case of certain commodities, usually primary agricultural products, special difficulties, such as a world surplus, may arise which would warrant the adoption of intergovernmental commodity agreements, including those which regulate production, trade, or prices. Such agreements would have to be consistent with certain general objectives and would need to satisfy certain conditions." The State Department has held hearings on the ITO Charter in various United States cities recently followed by controlled publicity. The news releases are, of course, favorable because the hearings were well staged. Export and import organization, international banking institutions, buyers' clubs, the movie industry, automobile and other groups naturally prejudiced in favor of free foreign trade were always in attendance with trained speakers like trained seals yelping for their fish and the same organizations appeared in the various cities. They were staged with just enough opposition to look genuine, very similar to the reciprocal-trade-agreement hearings before the committees on information held in Washington throughout January and February when industries were cross-ques tioned on reductions to the point where the slightest admission of a possible lower tariff was jumped at with glee by the so-called technical experts. It made no impression on the committees that tariffs had already been cut in 1939, following which occurred 8 years of war conditions and no opportunity to see the results of these reductions on a peacetime basis. It made no impression on the committee that since 1939 wages here had advanced 90 percent versus starvation wages abroad now. It made no impression on the committee that foreigners valued our dollars above their goods almost regardless of price or tariffs. It made no impression on the committee that industry asked for time to see what peacetime competition would bring in imports in the face of the 50-percent lowered tariffs of 1939. It made no impression on the committee for reciprocity informamation that our greatest export item in 1946 was machinery for the foreigners to manufacture goods mainly to capture our markets and our dollars. That an industry had produced vital war materials and needed preservation from the national-security angle seemed to make no impression. That tariffs were already below those of the Wilson administration due to the unconstitutional cuts made by the Trade Agreements Act was inconsequential to the free-trading committee. A member of the technical staff of the State Department told me that the skyhigh tariffs of the Hawley-Smoot Tariff Act of 1930 was the direct cause of the Ottawa Conference of 1934 where England made preferential trade agreements with all its colonies and among them. He gave no weight to the more compelling reason for world isolationism which was the decision of President Roosevelt to torpedo the London Economic Conference of 1933. In my opinion this was the signal and ammunition for Hitler to gain support and launch his diabolical campaigns of aggression and murder. It encouraged Mussolini to adopt the policy of the "have-nots taking from those nations who have" as he stated. It was the signal for the invasion of Ethiopia, and on the part of Japan for the invasion of Manchuria, against which our State Department took no action even when we were exporting our steel scrap by the shipload to Japan, thereby feeding their armament campaign for war against us. If this is the kind of free commerce which the State Department now proposes, I want no part of it. Having given the signal for nationalization and isolation in 1934, how can the political appointees of the State Department now be trusted by the outside world to adhere to the present so-called policy of freer commerce? Is it not maneuvering Congress into a position where a veto of the charter will mean more world disruption and loss of faith in our leadership? The charter will have gained the approval of other countries and this same pressure of publicity will be put upon Congress to ratify this charter which is supposed to come up a year from now, and conservative members who will oppose will then face the accusation of placing hindrances in the path of peace and, in fact, will be classified as warmongers. I contend that this situation will not lead to a peaceful world. Just to illustrate the inconsistency of the publicity campaign carried on by the State Department, I would like to refer the Ways and Means Committee to Publication No. 2758, Commercial Policy Series 100, of the Department of State. This is a pamphlet printed by the thousand at taxpayers' expense, being an address delivered before the World Trade Conference in Chicago on February 17, 1947, by Mr. Clair Wilcox. He is Director of the Office of International Trade Policy of the Department of State. On page 2 of this printed document I quote: "If there were no trade charter and no trade organization the benefits sought through trade agreement negotiation might well be lost ***. If there were no trade agreement negotiation, there would be no charter and no ITO. The program is all in one package. It must be taken as a whole or rejected as a whole." Trade agreements were inaugurated in 1934 by an unconstitutional law known as the Trade Agreements Act and now comes the ITO with Mr. Wilcox saying in the year 1947, 13 years later, that trade agreements are no good without ITO and ITO no good without trade agreements. That being the case, they were no good up to this time in his estimation because we have not had ITO. Yet the State Department points with pride at the benefits of the trade agreements already negotiated claiming all kinds of advantages to those countries who have been included in these unconstitutional trade pacts and disadvantages to those out |