Harvard Business Review in 1939. He concluded after an exhaustive survey of the figures:

World commerce, like the commerce of the United States, has not returned to 1929 levels. Although at first lagging behind the rate of recovery in world commerce, in recent years American foreign trade has gained relatively as well as absolutely. Since the depression decline was the greater for American trade, the world aggregate is closer to predepression levels than is the trade of the United States. An estimate of the physical quantum of world commerce in 1937 was 97 percent of the 1929 total; in 1938 the total was but 89 percent of 1929.

In 1929 American trade comprised 13.8 percent of aggregate world commerce; in 1938 it was 10.8 percent of the total. * *

There is some evidence that the Administration's trade-agreement policy has contributed to the relative increase in the export trade of the United States. Comparison of the volume of exports to agreement and nonagreement countries discloses a greater increase in exports to the agreement countries. Moreover, this country's share in the imports of those countries with which agreements have been reached has increased more rapidly than has our share in the imports of nonagreement countries. There is no clear indication, however, that the exports of commodities directly benefited under the trade agreements have increased faster than exports of nonbenefited commodities.

Professor Bliss leaned, if at all, toward showing up the trade agreements in their best light, but he pointed out that the increases were largely in machine products and that a detailed study might show that the increases were due solely to preparing for war. I shall not detain you on this part of the subject, for it is of no importance except as demonstrating that there is no reliable evidence to sustain the claim that the trade agreements have made a striking impact on the foreign commerce of either the United States or the world. Certainly there is nothing to show that the agreements can be an elixir for the world's ills.

Of more importance is the considered judgment of more than a few that the deliberate abandonment by our State Department of the reciprocal phase and the insistence upon a generalization, which in effect makes these agreements only a method of revising our tariff schedules downwards without the consent of the people, has made for world disorder instead of for world peace. I shall quote to you some excerpts from America and a New World Order written by Graeme K. Howard in 1940. Mr. Howard, who is now a colonel in the Army, was in 1940 the president of the General Motors Export Corporation, and he wrote from a life-long experience on the firing line of foreign trade in every part of the world. He advocated the act when it was advanced in 1934 and before it was revealed that "reciprocity" was to be but a name. Says Mr. Howard of our foreign policy during the thirties:

Here was the decade of striking illustrations of irresponsible intervention in world affairs. We torpedoed in 1933 the World Economic Conference. Our excessive devaluation of the dollar made distressing impact upon peoples of other lands the world over. We took the lead in imposing economic sanctions upon Italy. We listened to the President's memorable “Quarantine of Aggressor Nation" speech delivered in Chicago in 1937. We excluded from the benefits of reciprocal trade agreements those nations most in need of our surplus agricultural products-Germany, Italy, and Japan. We imposed countervailing duties against Germany. We attempted also the Pittman embargo against Japan and broke with that country our commercial treaty of long standing. As any fairminded student of international affairs knows, all these measures encouraged the spread of autarchy, engendered hatreds, and served to increase international economic and political anxiety.

And, specifically of the trade agreements, Mr. Howard says:

There never has been a denial of the indispensability of commercial trade agreements. We should ask ourselves, however, whether our past and current

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methods are sound when viewed in the light of national and international consequences. Particularly must we reexamine the generalized most-favored-nation clause which has been the guiding principle of our foreign trade policy. If we concede the emergence of regionalism on tomorrow's horizon, then the mostfavored-nation clause is as impractical an aspiration as universal free trade. Bilateral trade is the trade not only of the past but also of the present and future. Seventy-five percent of the pre-war trade of England was bilateral, 45 percent being within the Empire and the balance being with such countries as the Argentine, Uruguay, and Denmark, within England's sphere of economic domination. Practically all the trade of Germany, Russia, Italy, and Japan is bilateral. The only country making a bona fide gesture in the direction of the most-favored-nation policy is the United States, and even in that case the principle is not followed in respect to Cuba and the Philippines. By adhering to the most-favored-nation policy, with its laudable purpose of promoting world trade and the exchange of world surpluses, we in reality block or arrest the flow of trade. Actually, therefore, the most-favored-nation policy becomes an obstacle to trade by preventing the movement of goods between regions that complement each other economically, and it is therefore a deterrent to an efficient world order.

I have indicated to you, in my brief review, that at least there are two sides to this whole trade agreements question and that the picture is not quite so perfect as some of the Administration advocates would have you and the country believe. Since I do not care to be personal, I shall only say that the State Department cannot be held guilty of understating its case.

But why all the insistence that this bill be passed at once and without even a change in its punctuation? Why has the bill been lifted from its drab commercial surroundings and represented as the very cornerstone of the Administration's foreign policy? Why is it that the Administration advocates of this bill cannot submit to cross-examination without flying into a rage and questioning the intellectual integrity of their examiners?

The answer is plain. As I said in opening, this Administration is engaged in a series of commitments, extending beyond the war, that are of such a sweeping character that it does not dare to submit them to the people. These commitments are, for the most part, secret and I am unaware of their complete extent, but I trust that the Congress will dig out and exhibit the full roster of commitments. Here and now I can give you only two instances, but these are of profound significance.

You will recall that the President of the United States and the Prime Minister of the United Kingdom met on a warship at sea onthe 12th day of August 1941 and drew up a memorandum. I do not know what the memorandum means. If we are to judge by the speeches of Messrs. Churchhill and Stalin, it means whatever one wants it to mean. But I do know that this piece of writing, which some would have us dignify as the Atlantic Charter, is a purely personal recording by the President of his sentiments on the day of its signing.

Now, let me direct your attention to article VII of the lend-lease agreement between our Nation and the United Kingdom, dated February 23, 1942. It reads thus:

In the final determination of the benefits to be provided to the United States of America by the Government of the United Kingdom in return for aid furnished under the act of Congress of March 11, 1941, the terms and conditions thereof shall be such as not to burden commerce between the two countries, but to promote mutually advantageous economic relations between them and the

betterment of world-wide economic relations. To that end, they shall include provision for agreed action by the United States of America and the United Kingdom, open to participation by all other countries of like mind, directed to the expansion, by appropriate international and domestic measures, of production, employment, and the exchange and consumption of goods, which are the material foundations of the liberty and welfare of all peoples; to the elimination of all forms of discriminatory treatment in international commerce, and to the reduction of tariffs and other trade barriers; and, in general, to the attainment of all the economic objectives set forth in the joint declaration made on August 12, 1941, by the President of the United States of America and the Prime Minister of the United Kingdom.

I understand that all the lend-lease agreements contain identical or similar sections. That section goes far beyond any authority which I can discover in the Lend-Lease Act for the settlement of the accounts. It is a declaration of national policy of far-reaching and sweeping effect and it is a national policy which has not been submitted to the people through their Congress.

But, under the bill before you, that policy can be translated into a trade agreement and a complete change can be made in the economy of the United States without the people or the Congress ever having the chance to say a word about it.

If enough of these agreements are made, the eventual peace treaty will have been made before there is a peace table. And the people will have been bypassed. There is a reason why the legislation before you is "must" legislation that you are expected to pass without inquiry.

Take another case. In the final act of the third meeting of the ministers of foreign affairs of the American republics, which convened at Rio de Janeiro from January 15 to 28, 1942, one finds these recommendations and resolutions:

That, insofar as possible, the increase of production be assured by bilateral or multilateral agreements or contracts which provide for purchases during long periods at prices which are equitable for the consumer, remunerative to the producer, and which provide a fair standard of wages for the workers of the Americas, in which producers are protected against competition from products originating in areas wherein real wages are unduly low; and which make provision for the period of transition after the war and the readjustments which will follow in a manner guaranteeing the continuance of adequate production and permitting the existence of trade under conditions equitable to producers.

*

That the nations of the Americas stimulate the development of the basic production of each of them, avoiding insofar as possible the establishment or expansion of production of substitute or synthetic commodities which is economically artificial and might displace the consumption of natural products available in other American nations, there being excepted only those industries which are indispensable for national defense, provided that such defense needs cannot be effectively met with natural products.

If these recommendations and resolutions mean anything, they mean that the United States has pledged or intends to pledge itself to the maintenance of prices of South and Central American products by long-term purchase contracts. This is precisely the method which Nazi Germany has used and is using in Europe to buy cropsexcept that Germany, instead of paying money, opens a credit which must be liquidated in German goods.

The resolutions further mean that the administration, under the guise of promoting peace and trade, will go into business and, since most of the products in question are agricultural, will go into business in competition with the American farmer.

That is only part of the undertaking; the other part is to plan the production of Latin America and to guarantee against the danger of science creating substitute products which means guaranteeing against science alleviating the lot of the common man. Specifically, this means rubber. The low-paid labor of our "good neighbors" is to be substituted, on our guarantee, for the coolie labor of the Orient. The funds of the United States are now being used to promote the growing of rubber in several sections, but notably in Brazil. We are to furnish the capital and buy the product. A clue as to what this means is found in these paragraphs from an article appearing under the name of Vice President Wallace in the New York Times magazine for July 12, 1942, and reprinted in the Congressional Record of July 13:

Officials of the Rubber Reserve Company predict that this country within 18 months will be producing more rubber synthetically than she used to import from the Far East. All this will be done on the basis of a contract which provides that when the war comes to an end the Government will have the right to acquire the plants. This clause was put into the contract because President Roosevelt believes that the power of government and the emergency of war should not be used to build up vested interests which, after the war, would be sitting on the doorstep of Congress clamoring for a tariff *

I trust, however, that the vast bulk of our rubber would come from a really cheap source-from Latin America and the Far East-and that the automobile users of the United States would stand like a rock against a rubber tariff.

These conclusions, if the foregoing official and semiofficial words are to have their usual meanings, are inescapable:

(1) That a planned and regimented international economic union is being actively promoted by the Roosevelt administration, through the Department of State, by a use or misuse of the Lend-Lease Act and the war powers.

(2) That the aim of this union is to make the member nations dependent each on the other by each giving up a portion of its economic sovereignty and receiving in return a long-term order for the commodities allocated to it for production.

(3) That the United States will directly finance both the production and the buying, will assure a further stake through the settlement of the claims arising under lend-lease, will guarantee all contracts and will manage and police the whole vast scheme.

These plans can be put into effect through a liberal interpretation or stretching of the powers in the bill before you. If the statement, made to you by the Secretary of State is to be taken at face value, it is evidently the intention to stretch these powers in order to bring about, in advance of any formal peace, the arrangements which have already been initiated and which lack only the authority of this law to complete. There, can be no other reason for the imperative, dogmatic insistence upon this bill at a time when there is no foreign trade.

Now, it may be that the future world which has been presented to you by the Secretary of State is the ideal world. It may be that the administration has been endowed by the Creator with a foresight that transcends the human. The evidence on that point is not persuasive. It may be that the time has arrived to scrap our beloved United States and to abandon those ideals we have cherished.

But that, I say to you with all the earnestness I can command, is a decision to be openly arrived at by the people through their Congress.

It is not a decision to be made in a star chamber. And so I urge you to take this opportunity to reject this bill and return to the people the right to order their own lives through their own votes. If we must kill our sovereignty, let us, the people, sign our own death warrant. Mr. COOPER. Does that complete your statement, Mr. Crowther? Mr. CROWTHER. Yes.

Mr. COOPER. Are there any questions?

Mr. ROBERTSON. Mr. Crowther, when you acknowledged receipt of my letter thanking you for the interesting book you had sent to me, you wrote me a mighty nice letter in which you said that when you appeared before our committee this year I might have some questions to ask you about some of the views expressed in your book. I appreciated your letter and I told you I might have some questions and assured you they would be entirely of a friendly character whose purpose would be limited to an effort to bring out the essential and inherent differences of viewpoint between you and myself on the subject of international trade.

You no doubt recall that a distinguished newspaper man, William Allen White, has referred to that great era of expansion from 1900 to 1930 as the "gilded era of the almighty dollar when God presided in a 6-percent heaven and all was well with a laissez faire world?" You remember that?

Mr. CROWTHER. No; I do not.

Mr. ROBERTSON. Well, he made a reference to that effect.

At the turn of the century, we commenced an unparalleled industrial expansion. We imported labor from abroad, had cheap labor; we expanded our coal mines, our steel mills, our oil wells; we expanded our railroads; and we went forward on a broad commercial program. Is not that true?

Mr. CROWTHER. It started a little before the turn of the century. There were several cycles in there. But you are leading to a question, so why bother with the premises.

Mr. ROBERTSON. Well, of course, it did start a little before, but we generally speak of it as the development of the twentieth century; is not that correct?

Mr. CROWTHER. Well, it is a phase of the industrial revolution. I do not like these slogans; they are open to so much exception. I would rather you would recite the facts and let us see what you are leading up to. I used the term "industrial revolution"; I do not like that phrase, either.

Mr. ROBERTSON. Well, did we, or did we not, have a remarkable industrial expansion between 1900 and 1930?

Mr. CROWTHER. We had a remarkable progression from-I am not sure of the date. Now, there are two ways of looking at the thing. We had a trend. We have a lack of measurements which are very real. Mr. ROBERTSON. We had what?

Mr. CROWTHER. There is a lack of specific measurements. There is an emotional measurement. Carl Snyder, in that extraordinarily comprehensive index of his, has found that since about-well, since the Civil War, anyhow, our progress has been at the rate of about 3 percent a year. Although at periods we seem to go above that, it is usually due to some particular dramatic episode like the great development of electric power, or later the great development of