agreements which have become known as the Empire Agreements, the Ottawa Agreements, in retaliation and in defense against this inordinate tariff that we enacted in America. That caused me to take a look at the tariff from the comparative standpoint, and I see that if we take the United States as 100, the United States HawleySmoot tariff as 100, the United Kingdom tariff is 118.3. What makes you think, if you do, that the Ottawa Agreements were the result of the enactment of the Hawley-Smoot tariff, when England had a higher tariff than we did? Mr. CROWTHER. That is a curious story, the Hawley-Smoot tariff story. It is like the pleasant piece of fiction of what happened during the twenties. No one seems to have heard of the Macmillan inquiry in England, when the Macmillan Commission, composed of the ablest economists, financiers, and general businessmen in England inquired into the state of the British economy and, in the Macmillan report discovered that the British economy was not being benefited by their trade policy and that there was a considerable illusion as to the amount and effect of Britain's overseas loans. They made certain recommendations there, and you will discover that Great Britain's policy after that inquiry has been a protection policy. The Ottawa agreements were the obvious method of drawing together the Empire as a trade thing, in addition to being a spiritual thing. But all the record has been dismissed for this rather pat story-I suggested to the gentleman from Virginia this morning that we give it a number, and just say the number, in the course of our colloquy. But they have in this story dismissed all of the facts, and hung it up on this wooden Indian of the Hawley-Smoot tariff. It is a most extraordinary performance. Mr. GEARHART. I am beginning to feel that it is almost useless to attempt further to get it over to the American people that the HawleySmoot tariff was not a high tariff. They have said it so many times, following the old German method of propaganda, saying it over and over again long enough, that they have got the American people to think that there was something awfully high about that tariff when, as a matter of fact, among the important nations of the world our tariff stands as 13th when tested from the ad valorem standpoint and tested in the light of the exchange rates that existed in 1937. Mr. CROWTHER. I am familiar with that study. It is a very valuable study. Mr. GEARHART. And we might add that in very recent months the study has been rechecked by the American Tariff League and reverified in their most recent publication on the subject. I believe that behind the administration's program there is something very much more subtle than a simple desire to expand our foreign trade, as we were promised in the act itself and as originally enacted, and I think from what you said this morning that you agree with me in that regard. Mr. CROWTHER. Surely, sir. Mr. GEARHART. I am particularly interested in this subject of rubber. When war overtook us we found ourselves very greatly embarrassed by a rubber shortage which could not be cured by any importations of the natural raw product. So we had to turn to a production of the synthetic product, which is just as good for all practical purposes as the natural product. All Americans know that we had a great deal of trouble in getting that program started because there were too many people in the United States who were assuming the certainty of victory and were thinking more of protecting their post-war competitive condition than they were of doing something to help win the war. There were the advocates of the petroleum production of rubber and the advocates of the alcohol production. But in the background there was another group, those that didn't want a permanent synthetic rubber development in the United States. In your paper you quote a most convincing statement from the Vice President. This is what I want to call your attention to, that very recently, and after this rubber story was well known to the American people, they have negotiated two agreements, one with Peru and another with Mexico, the ink hardly being dry on the Mexican agreement yet, and in the Mexican agreement they bound guayule rubber to the free list and in the Peruvian agreement they bound india rubber to the free list. The Peruvian agreement was signed on July 29, 1942, after Pearl Harbor, and the Mexican agreement was signed on January 30, 1943. Mr. Crowther, doesn't that strike you as being rather significant, with this rubber story before our eyes and within our contemplation, that they should rush down and bind raw rubber on the free list? Mr. CROWTHER. It is almost unbelievable, sir. I cannot understand it. We can't get coffee from Brazil, but we are supposed in all future times to get rubber from there. I think it is a throw-back, really, and there was a colloquy between the gentleman from Virginia and the Secretary of State the other day; I happened to read the testimony in which each of them seemed to believe that production had been assigned by God to certain countries and there had been no progress in science, technology, or anything else. And I think these agreements set that out, that somehow rubber is a natural thing. The chemists tell me that if it hadn't been for the desire of the Government to have the one best method for making rubber we would be getting all the rubber we wanted today. At the time they wanted to decide on the one best method there was no one best method that could be decided on. If they had thrown the thing out and said, "Go to it; make what you can," by this time we would have had half a dozen best methods. Now this bill will stop that sort of thing, stop the natural progress, and I translate that into terms of men's wages. This synthetic rubber has a bad name. It is merely a plastic which will perform the former purpose of rubber better than the natural product, and it can be made in first-class factories paying good wages. The other stuff has got to be gathered by coolies. It has got to be on a starvation wage. That is the reason I shudder at the consequences of the program they outline. Mr. GEARHART. In view of the fact that they can lay down East India raw rubber, gathered by coolie labor under the lash from the far corners of the world, in San Francisco for around 3 to 4 cents a pound, and the best figures that I have been able to get anywhere are to the effect that you can only manufacture synthetic rubber for around 10 and 15 cents a pound, doesn't that look like a deliberately committed act, purposed for the destruction of the synthetic rubber industry in the United States as soon as the war is over? Mr. CROWTHER. I can't see any other method of explaining it. Mr. GEARHART. And this is an industry in which the United States has invested nearly $700,000,000 to date, in which are employed great numbers of American workmen at high salaries. In their love for the foreigner and their disinterest in the welfare of Americans, they would have all of those men discharged and all of those magnificent plants dismantled. Mr. CROWTHER. And for what? Mr. GEARHART. That brings me to a discussion of another subject. I searched this act of 1934 from cover to cover and I don't find a line in it that justifies the State Department in any agreement binding anything on the free list. Have you been able to find anything in that act to justify that? Mr. CROWTHER. No, sir; and I can't, also, not being a constitutional lawyer, find any authority to take away from the Congress the right to levy excise duties. They have also done that in some of the agreements. Mr. GEARHART. And those two things constitute, at least in my opinion, nothing short of usurpation of the legislative power granted to the Congress of the United States by the Constitution. Mr. CROWTHER. That is my view, sir. Mr. GEARHART. What would happen after they have signed an agreement in which they have endeavored to bind something on the free list if the Congress would proceed to exercise its constitutional right and legislate on the subject, imposing a tariff on that item? Mr. CROWTHER. That is an interesting question, and I believe considerable thought was given during the progress of the last 8 years to how, exactly, to test the right of the President to make certain of these agreements, but I understand that no one found a method of getting it into court. Mr. GEARHAKT. And that is because they put a line in the act of 1934 which takes from the people who are injured and who want to go into the courts for redress the right to resort to our constitutionally established judicial departments. Subparagraph (d) of paragraph 369, section 2, reads as follows: The provisions of section 336 and 516 (b) of the Tariff Act of 1930 shall not apply to any article with respect to the importation of which into the United States a foreign trade agreement has been concluded pursant to this act. That is the part of the act which closes the courts to every American who has gotten a raw deal as a consequence of a reciprocal trade agreement. Now, if we should pass a law putting a tariff on rubber, and there is an agreement in existence freezing rubber on the free list, under this act they could regard it as frozen on the free list and no one could go to court about it. Don't you think that we ought to take that out of this act if, by any chance, it is continued? Mr. CROWTHER. I would take the whole act and throw it out of the window. Mr. GEARHART. I hope that can be accomplished, but certainly if any part or portion of it is continued, they should take out of it the part of the act which closes the doors of the courts to a citizen of the United States who believes that he has been wronged by the enforcement of its provisions, don't you think? That is one of the first things that should come out of the act. Mr. CROWTHER. I can't agree that any part of the act is right. Mr. GEARHART. I would like to have your views in respect to this point that I have been turning over in my mind, and that is, it has to do with whether or not they are enforcing the act for the sole purpose of expanding our foreign markets, or whether or not they are using the act in part, at least, if not entirely, for the purposes of power politics. Mr. CROWTHER. I think the Secretary of State made that very plain in his formal statement to you, that since there was no foreign trade, this was purely an act to give a certain amout of power in politics. Mr. GEARHART. And it is used along with all the other statutory instrumentalities that they have been annoyed with. Mr. CROWTHER. Yes, sir. Mr. GEARHART. Along with lend-lease, along with the general commercial treaties that we have. Don't you think, or do you think, that the sending of tremendous quantities of scrap metal to Japan, tremendous quantities of aviation gasoline, more scrap metal than they could possibly use in their peacetime pursuits, more gasoline than they could possibly use in their automobiles and airplanes, when on peace bent, was a use of trade as an instrument in power politics? Mr. CROWTHER. I think the President has acquiesced in that. As I recall, I think it was in one of his press conferences he explained that they thought that was a method of keeping Japan out of British and Dutch possessions. You are speaking of Japan primarily? Mr. GEARHART. Yes; in that particular instance. Mr. CROWTHER. So to that extent it was purely political. Mr. CROWTHER. I think it is; yes, sir. Mr. GEARHART. To use commerce for power politics? Mr. GEARHART. Trade and commerce are subjects of dollars and cents, the bread and butter of the people. For that reason I think, and I think you agree with me, they should deal with commerce in the interest of more of them, and in the interest of developing in the United States a greater prosperity for our people, rather than to try to effect all sorts of political objectives by sacrificing the dollar-andcent interests of our people, their bread and their butter. Mr. CROWTHER. I agree entirely with that. I can't see any justification for using, for copying, the Old World use of trade as an instrument of power, forgetting that the real reason for trade is the wellbeing it brings to our own people. Mr. GEARHART. Would you agree with me that if they have failed to achieve or to keep any of the promises they made to the American people when they asked them to enact this law through their representatives in the first instance, that we ought to refrain from extending the act? Mr. CROWTHER. I will go very much further than that, sir. If this act could be demonstrated as the most beneficial act ever passed in the history of humanity, I would not believe it good enough to take away the right of self-government, so the mere fact that it has failed seems to me inconsequential. It is the very thought of taking away the power of Congress to determine the policies of this country that interests me. So I can't say that any act could be successful if that is its consequence. Mr. GEARHART. And in view of the fact that they have usurped legislative power to bind articles upon the free list, to deal with excise taxes, and to repeal provisions of treaties which have been regularly ratified by the Senate of the United States, those three usurpations alone ought to justify us in scrapping this program where it is today. Mr. CROWTHER. I feel that way, and in addition the broader sentiment that I expressed to you. Mr. GEARHART. Supposing we confine ourselves entirely to the main objective they put in the first line of the act: "For the purpose of expanding foreign markets for the products of the United States," how do you think those of us who come from agricultural States feel when we look at the record and find that the imports during the period of the administration of the reciprocal trade-agreement law-imports from all countries-had gone up 57 percent, and that of our exports to all countries of American-produced agricultural products during the same period of time had dropped to a minus of 30 percent of what they had been when the reciprocal trade-agreement law was enacted into law? How should we feel about it? Do you think we should give three cheers for this act? Mr. CROWTHER. I should hardly think so. But if the figures were reversed, and an enormous benefit apparently was conferred on us, I still feel it is not sufficient to scrap the form of our Government. Mr. GEARHAKT. I heartily agree with you. I am glad you came here, because you are giving me courage to look at the larger problem. The greatest responsibility that rests with us is to maintain our tripartite form of government as outlined and defined by the Constitution of the United States, and their administration of this act is just a series of usurpations and denials of the congressional balance of things as conceived in our Constitution. They have taken over and become the legislative branch of the Congress so far as the fixing of tariffs is concerned. They have become the legislative branch insofar as tying our hands from the exercise of that constitutional power conferred upon us by the Constitution of the United States. I think you have given me enough to think of for a week. Thank you for coming. Mr. SIMPSON. Mr. Chairman. The CHAIRMAN. Mr. Simpson. Mr. SIMPSON. Mr. Crowther, the last sentence in your statement reads: If we must kill our sovereignty, let us, the people, sign our own death warrant. From that I take it you are referring to the fact that through these boards and the various departments which do not include elected representatives we are giving up a part of our sovereignty in that through the trade treaties representatives do not have a chance to pass upon the merits or demerits of the individual trade agreements. Is that correct? Mr. CROWTHER. Exactly that, sir. The subject was brought up this morning under the head of international cooperation. We have heard |