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Secretary HULL. A lot of misinformation went out in the old days about the height of tariffs and about the amount of tariff benefits and other things. There was a fund of misinformation put out on that, and it takes a very heroically disposed person to tackle that sort of problem now.

Mr. GEARHART. But, as a matter of fact, the United States is thirteenth when measured among the important nations of the world insofar as ad valorem is concerned, is that not true, in accordance with the exchange relationship and currency of 1937?

Secretary HULL. You are talking about per capita ? Mr. GEARHART. No, sir; I am talking about ad valorem. Secretary Hull. Well, that has not necessarily any significance with respect to the benefits that are derived under a given system.

Mr. GEARHART. Take the United States, and put her at 100. We find the tariffs of other countries go up in this fashion: Argentina, 110; United Kingdom, 118.3; Switzerland, 128; Egypt, 130; Mexico, 149; Italy, 150.5; Hungary, 160; Greece, 166; Brazil, 239.4; Germany, 279; Turkey, 359; Spain, 469. They get up pretty high above us.

Secretary HULL. I think it is evident that the Congressman is headed straight down the old gulch of extreme economic nationalism, and I hope the Lord may take care of him!

Mr. GEARHART. You will have to admit that as measured against the tariffs of those important countries in the world, the SmootHawley tariff was not a high tariff, but was an average tariff in this world.

Secretary HULL. Again it takes a heroically disposed person to bring up those particular topics for discussion. I am inclined to look toward the future instead of toward the past, and I am sorry and disappointed that not one word, and possibly not one thought of the gentleman from California has faced the future, so far as I can judge.

Mr. GEARHART. I must plead guilty to an inability to see this picture in the beautiful way you do yourself, and I don't feel bad when you use short and ugly words like “pettifogger.” I haven't used any words like that.

Secretary Hull. If the Congressman desires to go clear out of his way to bring in a subject of designation

Mr. GEARHART. Nor do I resent your saying I represent the cattle of my district. I think that is a little out of order, too.

When a certain campaign was on in 1932, when a certain gentleman was running for President of the United States, he said this in a speech at Baltimore:

I know of no excessively high tariff duties on farm products. I do not intend that such duties shall be lowered. To do so would be inconsistent with my farm program, and every farmer knows it and will not be deceived.

Now, in the face of that promise to the American people the tariffs on agricultural products have been lowered to the number of nearly 400. Was the President right then? Or is he right now?

Secretary HULL. Of course the Congressman, I am sure, knows that we are dealing, in a large sense, with a brand-new situation today. It is immaterial today what the President, under a different situation. or what the Congressman from California, said. I am trying to keep attention riveted on the problems just in front of us.

Mr. GEARHART. Mr. Hull, you told us that same thing in 1934. You said you had a depression to get over with. You were dealing with peculiar conditions then. You told us in 1937 we had peculiar conditions, and you asked for a further continuance. In 1940 you were going to maintain peace throughout the world through reciprocal trade agreements. Everybody that was against the program then was a warmonger. In 1943 we must have these treaties again in order that we be not misunderstood by our allies. What will be our grounds for requesting a continuance in 1947 ?

Secretary HULL. Frankly, notwithstanding my personal regard for the Congressman, I don't think it is in his

power to discredit these agreements by continuously attributing to them implications and alleged ideas and facts that I don't for a moment consider applicable to them. This was one impressive example of international cooperation that we have succeeded during the past decade in getting into operation and carrying forward. It has been impossible for the public to take up and face squarely and settle finally the question of which way they would have the world go in the future, whether on the narrow course which we have described often, or on the opposite course, which we have also described often, and which I sought to describe in the statement I read to this committee this morning. But this country and all countries will have to face that question, and have to face it very soon, and I assume that my good friend from California has already faced it and made his decision, from the line and tone and nature of his questions.

Mr. GEARHART. Now, Mr. Hull, we are not the only country-ours is not the only country—that has entered into reciprocal trade agreements with other countries, are we?

Secretary Hull. Ours is the principal country carrying forward this policy and carrying it forward on the unconditional favored nation basis.

Mr. GEARHART. Thats it. We are the only country that is executing trade agreements on the unconditional most-favored-nation principle.

Secretary HULL. Which has been quite profitable to us so far.

Mr. GEARHART. In other words, you make an agreement with one country and don't give to that country anything that every other coun: try on the face of the earth does not get.

Secretary HULL. The gentleman does not, I think, take notice of the real breadth of these policies. They seek to prevail on as many nations as possible, in an ever-widening circle, to lower as much and to liberalize as much as they will the excesses in their obstructions to imports from other countries. Then the individual traders, first by the thousands and then by the tens of thousands, and in steadily increasing numbers, get in touch with each other back and forth from their respective countries, and they carry on the trade.

So we don't know all who are parties to it, except that under this policy it becomes a steadily broadening and growing and thriving business of a mutually profitable and desirable nature.

Mr. GEARHART. All right.

Now, Brazil and Argentina recently made a trade agreement. Did either one of them generalize it to the United States ?

Secretary HULL. Yes.

Mr. GEARHART. My question was: Did either Argentina or Brazil generalize the concessions they granted to the other to the United States?

Secretary Hull. Yes; they did.

Mr. GEARHART. They did not extend it under the unconditional most-favored-nation principle?

Secretary HULL. Yes; they did.

Mr. GEARHART. How about Venezuela and Chile? They made an agreement. Did they try to generalize it to the United States?

Secretary Hull. I don't know about any such agreement involving tariff reductions. However, I have tried to explain, and I don't think I will do so many more times, that during the war period especially we have had special conditions in some of these agreements.

Mr. GEARHART. I agree with that, Mr. Hull. I am just asking for a simple statement of fact.

Secretary HULL. And I am making a statement of fact. We provide safeguards in every agreement that will take care of us in the most ample manner on every phase of the commercial and economic relationship.

Mr. GEARHART. Well, I don't suppose it will be possible for me to get a definite answer on that, but I am going to state for the purpose of the record that reciprocal trade agreements have been made between Venezuela and Chile, Argentina and Chile, Peru and Argentina, Bolivia and Argentina, Chile and Uruguay, Brazil and Paraguay, Argentina and Colombia, Argentina and Chile, and I would like to know whether or not they have been generalized under the unconditional most-favored-nation principle.

Secretary HULL. You will find that principle running all the way through them. As I say, there will be some temporary or minor departures due primarily to the war emergency.

Mr. GEARIIART. Weil now, as a matter of fact, Mr. Hull, haven't they withheld generalization from us, claiming that they have a right to deal particularly with contiguous countries?

Secretary Hull. The gentleman may have in mind what they call customs unions down there among three or four of those countries that lie in the continent, for limited purposes, and we have sought to work with them in a way, but it hasn't cost us anything and we are gradually moving in a way to get much more out of that situation than we probably would in any other way.

Mr. GEARHART. Well, the sum total of it is that all the countries of the world are making among themselves reciprocal trade agreements, and that no country in this world is extending to the United States unconditional most-favored-nation treatment in reference to those treaties and concessions therein granted.

Secretary HULL. Well, we have been charged here today with the great mistake of espousing and putting and keeping in operation the favored-nation policy. Now my friend comes along very complacently and says it hasn't been in operation at all, so I am wondering. I think I will call my friend Mr. Woodruff back here.

Mr. GEARHART. I think it is the other way around, isn't it, Mr. Hull?

Secretary Hull. Of course, the Congressman must be serious, at least enough to agree that the main attacks that have been made on this program have been on the general operation of the favorednation policy, and objections that were offered to it, and this is the first time that it has been intimated to me that it is not generally in operation in the treaties and agreements between us and other countries. If I am wrong about that, I would like for the Congressman to give me some further facts, because I don't think it is fair to have this policy dealt with in a way that is not entirely in harmony with the facts.

Mr. GEARHART. Mr. Hull, let me ask you this very definite question. You believe in free trade, don't you?

Secretary HULL. I haven't known any person who ever thought seriously about literal free trade, if that is what you are talking about.

Mr. GEARHART. As a matter of fact, you have not used the reciprocal trade agreement authority for the purpose of expanding our foreign markets, but as a means and method of knocking down horizontally the American tariff system.

Secretary HULL. That is entirely incorrect, except to the extent that this is used to readjust downward the excesses in trade barriers.

Mr. GEARHART. But the way it works out under the application of the unconditional most-favored-nation treatment, every agreement constitutes a leveling of the tariff to the extent that that proffers that agreement to every nation across the board, to every nation on the face of the earth except Germany.

Secretary HULL. Well, nobody has been hurt yet, materially. That is the best answer to all the gentleman has been saying.

Mr. GEARHART. You say we are not hurt when you take away from the American farmer one-third of his foreign market?

Secretary Hull, I deny most of what the gentleman said about the farmer.

Mr. GEARHART. Well, you are denying the official figures of the United States Tariff Commission if you do.

Secretary Hull. If necessary, I will take chances on being supported by the full facts.

Mr. GEARHART. But you will admit that the effect of an agreement is to cut the tariff, not for the benefit of the country that enters into the agreement with us but for the benefit of every nation on the face of the earth. without condition, save Germany.

Secretary HULL. I just reassert all that has been said about the full and complete operation of this provision, and I deny any other implication, any implications to the contrary.

Mr. GEARHART. With respect to your own philosophy, don't you believe the United States would be better off if we didn't have any

tariff at all?

Secretary HULL. I am glad we have so much time here to deal with such questions as that. If the Congressman ever looked up my record, he never heard me mention the words “free trade” in my life, or heard me intimate remotely anything that he is implying now.

Mr. GEARHART. Do you believe in protection?

Secretary HULL. And why he asks that question, except to take up time, I don't know.

Mr. GEARHART. Do vou believe in protection?

Secretary HULL. I have stated what we are doing, and the gentleman can interpret that. When we have tariffs left here practically on the level, in many cases much higher, than the Fordney-McCumber tariff, he can call that whatever he pleases.

Mr. GEARHART. The reciprocal trade agreement confers upon you the authority to raise the tariffs by 50 percent. Have you ever raised one?

Secretary HULL. We would raise one without hesitation when the occasion might present itself, but our immediate and main purpose was to prevail on other nations to join with us in lowering the excessive provisions in all of their different kinds of trade obstructions, so that trade could assert itself.

Mr. GEARHART. But in that ambition you have not been successful, because not a single country has taken the unconditional most-favorednation principle that you have urged upon them.

Secretary HULL. I deny utterly what the Congressman says, and all the implications.

Mr. GEARHART. Will you name one country that has issued toward the entire world in respect to trade the unconditional most-favorednation principle?

Secretary HULL. Mr. Chairman, all my life I have got along, ordinarily, with my colleagues and associates.

Mr. GEARHART. We are getting along lively, Mr. Hull, if you will just answer the questions.

Secretary HULL. But I am getting a little bit fed up with the nature of his questions, as well as the number of them.

Mr. GEARHART. I am very, very sorry, but didn't you come to impart information? Or did you come to tell the committee you didn't like me?

Secretary HULL. We are not shedding any light on the situation that I can see.

Mr. GEARHART. To make it perfectly clear, and that you will understand that I am seeking information, I will ask you again, can you name one country that has announced to the world its adherence to the unconditional most-favored-nation principle of treatment in respect of trade?

Secretary Hull. If the gentleman will read any of these trade agreements we have made he will find where both sides agreed to that.

Mr. GEARHART. That is all.
Mr. ROBERTSON. Just two or three questions, Mr. Chairman.
Mr. REED. Do you want to reexamine the Secretary for a while?

Mr. ROBERTSON. Just on the point of what we have just had. I don't insist, because I have already asked him some questions, and I concede your priority.

The CHAIRMAN. Mr. Reed, and then we will go back to Mr. Robertson.

Mr. REED. I yield.

Mr. ROBERTSON. Mr. Secretary, I just want to suggest that I think you have made a mistake when you challenged only 90 percent of the correctness of the figures the gentleman from California gave you on the subject of what these agreements have done to the farmers. You would have been more accurate if you had denied 100 percent, because they were not United States Tariff Commission figures, they were John Lee Coulter figures.

Mr. GEARHART. Will the gentleman yield? These are from the United States Tariff Commission.

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