fair trade rules. These rules are not completely rigid; they tre really more like guidelines of policy. They have been hammered out in prolonged negotiations and they have been tested during this difficult postwar period. The meetings of the Organization would provide the occasions for hearing complaints and trying to iron out difficulties. Retaliation would still be open to countries if less drastic methods of settling disputes failed, but it would be a method of last resort. A very important feature of the Organization is the permanent Secretariat, which would assemble factual material bearing on disputes and trade matters generally, with a view to helping the member governments settle questions promptly and in the light of the fullest possible knowledge. It is difficult to overestimate the value of a competent Secretariat for the Organization. The above remarks have related to the important issue of settling disputes on trade matters without recourse to methods which destroy trade itself. My second major point relates to what might be called the positive side of the proposed Organization for Trade Cooperation. The Organization also provides an established mechanism for negotiating reductions in trade barriers. The nations that would be members carry on over four-fifths of the international trade of the world. As explained earlier, there are numerous trade barriers in existence, and there is a strong tendency for them to increase, so there will be plenty of opportunities for the members to join together to reduce the barriers, to their mutual advantage. The 1946 negotiations, which gave rise to the General Agreement on Tariffs and Trade, and the negotiations since then, have demonstrated that it is possible to have successful multilateral negotiations. The bilateral system on negotiation is much less likely to be effective because it does not bring together the principal suppliers and principal buyers of particular commodities. Also, the bilateral system is inevitably slower. The experience of the 35 countries that are contracting parties to the general agreement provides reasonable assurance that the Organization for Trade Cooperation can perform this valuable service of facilitating negotiations among countries to reduce trade barriers. The benefits of reduced trade barriers are well known but they are always worth restating. The immediate effect of reduction is to widen the range of opportunities to sell and to buy for producers and consumers in the various countries. This is obviously valuable. The next effect is to enable industries in various countries to specialize in the production of things in which they have the greatest comparative advantage. This means a larger total production and consumption for all of the participating countries and hence a further stimulus to the expansion of trade. I have thought many times how great the advantages of international trade must be for so much of it to survive the hurdles that are put in its way. If it is around $80 billion per year now, with all the encumbrances, think what it might be with some reductions in these barriers. As this committee knows, the executive branch of the United States Government has negotiated reductions in trade barriers in accordance with the authority given it by Congress. My third and final point relates to the contribution that the Organization for Trade Cooperation can make toward world peace and toward our national security. One of the major indirect effects of the increased economic well-being that comes from increased trade is the reduction of the pressures making for war. I would not contend that full stomachs assure peace, but I would say that in a great many situations poverty breeds unrest which invites outs de intervention and conquest. Hence, the Organization for Trade Cooperation would do its share, along with the international Bank, the International Monetary Fund, and other organizations, including our own national organizations, to help various countries improve their economic situations. It will be advantageous for the OTC to become a specialized agency of the United Nations. The Organization for Trade Cooperation can also make an important contribution toward peace by developing a workable pattern of international cooperation. Relations among nations will improve when people in the various nations, working through their governments and otherwise, learn how to work together on projects of common interest and learn how to settle disputes without resort to violence. There is no better way to learn how to do this than by practice. And there is no better field in which to practice than the economic, for it is important to everybody. The Organization for Trade Cooperation provides the most effective means of cooperation in this field likely to be devised for a long time. If we look at this question from the point of view of our national security, it is readily apparent that we must work with friendly countries in the economic field, and particularly in the parts of economic life which vitally affect their ability to earn their own way, namely, in international trade. And we must work with them on a continuing basis, as equal partners in a common enterprise. There is urgency about this matter. The question of a permanent international organization for trade cooperation has been hanging fire for a long time. If something is not done soon, narrow economic nationalism will further splinter the economies of the Free World nations, even without efforts by unfriendly countries. But with the Organization for Trade Cooperation functioning, we can cooperate with other countries at nominal cost and with great potential gain. I hope very much that your committee will enthusiastically endorse United States participation in the proposed Organization. Hon. HALE BOGGS, THE COUNCIL FOR SOCIAL ACTION OF THE CONGREGATIONAL CHRISTIAN CHURCHES, New House Office Building, Washington, D. C. DEAR CONGRESSMAN BOGGS: In connection with the hearings being conducted on customs, tariff laws, and trade agreements, I should like to submit for the record the resolution adopted by the General Council of the Congregational Christian Churches at its convention in Omaha, Nebr., in June 1956: "The livelihood of men and women in most countries is closely related to the volume of international trade. The United States, as the world's richest and greatest creditor nation, has a special obligation to follow domestic and international practices which will increase the flow of such trade. We support the United States' program of reciprocal-trade agreements and its international counterpart, the General Agreement on Tariffs and Trade. We urge that the United States join the Organization for Trade Cooperation, which provides the administrative machinery for the General Agreement on Tariffs and Trade.” Sincerely yours, HERMAN F. REISSIG. WORLD TRADE ASSOCIATION, Representative HALE BOGGS, DEAR CHAIRMAN BOGGS: The San Francisco Area World Trade Association, founded in 1917, is very interested in the hearings of the special subcommittee investigating United States trade policies and wishes to present the attached folder of information, California's Billion-Dollar Industry World Trade, for inclusion in the official records of the subcommittee. The association will also be very interested in the minutes and other materials published by the special subcommittee and will be pleased to cooperate in every feasible way with the members of the special subcommittee. The world trade department of the San Francisco Chamber of Commerce acts as the secretariat of the San Francisco Area World Trade Association. There are also attached sets of data about the association and of the world trade department of the San Francisco Chamber of Commerce. With assurances of our high consideration, JAMES P. WILSON, Secretary. CALIFORNIA'S BILLION-DOLLAR INDUSTRY-WORLD TRADE JOBS FOR THOUSANDS-MARKETS FOR AGRICULTURE, MINING, FORESTRY, FISHERIES AND MANUFACTURING SOURCES OF SUPPLY FOR NEEDED PRODUCTS AND MATERIALS PROSPERITY DEPENDS ON HEALTHY, TWO-WAY TRADE America is the most productive nation on earth, and California plays a dynamic and constantly expanding role in supplying the peoples of this country and of the world with products for daily living and for industry. But hand-in-hand with the importance of our productive power is our increasing dependence on trade with the free world. As American farm and factory production continues to exceed our national appetites, overseas markets must be found. As our unbelievable consumption of materials continues to grow, new world sources of supply must be found. Our friends abroad need trade also. The American market-as a place to sell as well as to buy-is the single most important factor in the economic world today. On our ability to expand the trade of the free world rests not only our prosperity but our future as well. California agriculture is benefited through the heavy exports of many of its products. A sizable proportion of many of our basic crops find overseas markets. Such exports tend to reduce price-depressing surpluses. Increased exports by industry in the State and throughout the Nation means greater purchasing power and therefore heavier consumption of farm products. An unsatisfied demand for California farm products exists in most of the world-unrealized markets which can only be reached by increasing our total trade with other nations. Much of the world remains underfed and poorly clothed. As population everywhere continues to grow, our foods and cotton can play an increasingly important role in building a more healthy, prosperous world for all. California manufacturing industries are heavy contributors to our State's annual billion-dollar export volume. To many, overseas markets are essential to maintain employment and profit levels. As our State's industrial capacity expands, our export of manufactured products will assume even greater importance. But markets are not all our industry needs. As a nation, we import, wholly or partially, two-thirds of the 100 basic materials essential to our production— and this proportion will gain each year. The processing and manufacturing of imported fibers, ores, and many other raw materials are important sources of employment and profit to Californians-and essential to many of our industries. California consumers benefit daily from our trade with other nations. Many of the products which make our lives more pleasant-coffee, tea, sugar, spices, cocoa-come entirely or partially from abroad. Many quality products brought to us from throughout the world offer us a wider selection when we go shopping for textiles, ceramics, tableware, leather goods and other consumer goods. Even our exports benefit the consumer by providing the income of many. Wages paid in export industries are an important segment of our total manufacturing payroll. Add to this the thousands of jobs provided in industries dependent upon our export and import trade-on the docks, in banks, transportation, and others-and one realizes how closely our prosperity is tied to California's billion-dollar industry-world trade. "World trade with the related activities of international finance is a twoway street. We cannot forever continue to sell abroad if we refuse to buy from abroad; nor is it sound for us to continue to give away our products, raw materials, and resources * * * a long-range program that results in increased twoway trade is the best assurance for more products for more people at lower prices both at home and abroad."-From the introduction to the World Trade Policy Declaration of the San Francisco Chamber of Commerce, approved by the board of directors on April 9, 1953. CALIFORNIA'S WORLD COMMERCE SERVES EVERYONE Imports to northern California include Tin for our canning industry-from Bolivia, Malaya, the Netherlands, Great Britain, and Belgium-Luxembourg. Ores for our mills-from Latin America, Korea, Iran, the Philippines, and Australia. Petroleum-for our refineries and your automobile-from Canada, Curacao, Saudi Arabia, and Malaya. Rubber for many uses-from Ceylon, Malaya, and Indonesia. Fertilizers for farms and ranches-from Europe and Latin America. Coffee from Latin America, Indonesia, Belgian Congo, French West and British East Africa. Sugar from Cuba and the Philippines. Newsprint from Canada, Sweden, and Norway. Spices from Europe, Latin America, Asia, the Middle East, the Pacific Islands, Africa-from everywhere. Fibers from the Philippines, Latin America, India, Pakistan, and Indonesia. Tea from Pakistan, India, Ceylon, Formosa, Indonesia, and Japan. Cocoa from Costa Rica, Panama, the Dominican Republic, Ecuador, and Brazil. And many others. BUFFALO CHAMBER OF COMMERCE, October 12, 1956. Mr. LEO H. IRWIN, Clerk, House Ways and Means Committee, House Office Building, Washington, D. C. DEAR SIR: The Buffalo Chamber of Commerce has favored liberalized trade policies that would stimulate the expansion of international trade. Repeatedly we have advocated a repeal of the Buy American Act, the lowering of tariff rates, the reduction of quantitative restrictions on imports, simplification of customs regulations and procedures, an extension of the Reciprocal Trade Agreement Act, membership in OTC and other proposals that would further expand trade between nations. The Buffalo Chamber of Commerce wishes to reaffirm its positions on these matters and to place this statement on file with the Ways and Means Subcommittee on Customs, Tariffs, and Reciprocal Trade Agreements. Yours very truly, CHARLES C. FICHTNER, STATEMENT ON FOREIGN ECONOMIC POLICY BY INTERNATIONAL HOUSE, NEW ORLEANS, AND ENDORSED by Board oF COMMISSIONERS, PORT OF NEW ORLEANS, AND BY INTERNATIONAL TRADE MART OF NEW ORLEANS Being an institution dedicated to world trade, peace, and understanding, International House is vitally interested in foreign economic legislation. Taking note of the invitation to present views on matters under consideration by your committee, we submit the following statement and request that it be incorporated in the record of your hearings. Periodically, governmental policies affecting international commerce must be formally reexamined in the light of changing conditions and in order to assure reasonable consistency with other aspects of overall international relations. One of these instances is now before us, given its formal recognition by establishment of your subcommittee and its scheduled hearings. It is our understanding that out of these hearings may develop proposals for amendments and perhaps a rewriting of certain basic legislation. With this view in mind, International House wishes to reaffirm its position as favoring expanded world trade opportunities, and the retention of commerce in private channels to the maximum extent possible. BASIS OF INTEREST The home city of International House, as a key port, is vitally affected by the movement of United States trade in merchandise. Its exports include a wide variety of manufactured goods originating primarily in the great midcontinent of the United States. Among these are chemical products, machinery, and iron and steel products. Principal agricultural products exported through New Orleans are cotton, wheat, rice, corn, soybeans, and similar bulk commodities, drawn from an extensive hinterland. Some of these are key items in the agricultural surplus disposal program, and any policy affecting their international movement is of prime concern to this area. A large part of New Orleans import trade consists of products that are not now affected by rates of duty in any significant degree, if at all. Among these are coffee, sugar, bananas, molasses, burlap, and jute bagging, and rubber. Others, whose movement should be expected to increase if certain restrictions were removed, are of substantial interest to the business concerns dealing in them or servicing their movement. However, a responsible citizenry must not allow its expressions to mirror solely immediate self-interest. It is our duty to consider equally the broader aspects of each situation in the light of their impact on the national economy and on the position of the United States in the world. In this respect, legislation designed to aid one segment of the economy, whether on a geographic or industrial-agricultural basis, must be tempered by consideration of its effects on other segments of the economy and on the several facets of overall foreign policy. |