General Agreement on Tariffs and Trade

“ To seize that initiative, I shall shortly send to the Congress a new five-year Trade Expansion Action, far-reaching in scope but designed with great care to make certain that its benefits to our people far outweigh any risks. The bill will permit the gradual elimination of tariffs here in the United States and in the Common Market on those items in which we together supply 80 percent of the world’s trade—mostly items in which our own ability to compete is demonstrated by the fact that we sell abroad, in these items, substantially more than we import. ”

“ When Congress passed the 1930 Tariff Act there were roughly 700 categories of imports. Since that time—with the adoption of the Reciprocal Trade Agreement Act—the number of categories has been increased by the thousands. Most of the increases were in categories created to help foreign countries expand their trade in the United States. The duty on a comparatively few imports has been revised upward as a measure of protecting some of the American industries from lower-cost foreign competition. ”

“ As I have indicated, it is increasingly clear that to obtain and maintain that equity and substantial equality of treatment essential to the flourishing foreign trade, which becomes year by year more important to the industrial and commercial welfare of the United States, we should have a flexibility of tariff sufficient for the give and take of negotiation by the Department of State on behalf of our commerce and industry. ”

“ The most sensible and scientific tariff law which the United States could have,—allowing that the principle of tariff for revenue and protection is to prevail,—is such rate of duty as may be deemed advisable, all things considered; an arrangement whereby a surtax could be imposed upon goods from countries discriminating against American merchandise, and a trading margin for treaty-making purposes, ranging from the normal rate of duty, as [Pg 893] set forth in the customs laws, to absolute free trade between the treaty-making powers. ”

“ It is by no means desirable, however, that the policy under consideration should be applied to these countries alone. The healthful enlargement of our trade with Europe, Asia, and Africa should be sought by reducing tariff burdens on such of their wares as neither we nor the other American States are fitted to produce, and thus enabling ourselves to obtain in return a better market for our supplies of food, of raw materials, and of the manufactures in which we excel. ”

“ I can not too strongly urge in early completion of this necessary legislation It is needed to stabilize our industry at home; it is essential to make more definite our trade relations abroad. More, it is vital to the preservation of many of our own industries which contribute so notably to the very lifeblood of our Nation.
There is now, and there always will be, a storm of conflicting opinion about any tariff revision. We can not go far wrong when we base our tariffs on the policy of preserving the productive activities which enhance employment and add to our national prosperity. ”

“ Article 40 The Member States reaffirm the principle that when the more developed countries grant concessions in international trade agreements that lower or eliminate tariffs or other barriers to foreign trade so that they benefit the less­developed countries, they should not expect reciprocal concessions from those countries that are incompatible with their economic development, financial, and trade needs. ”

“ The principal factor in the disproportion between the production and consumption of certain articles is the customs tariff. It acts in two ways: by depriving the export trade of the markets to which it has been accustomed, and by stimulating new manufactures which are destined in their turn to find no market. ”

“ A tariff on raw materials may be necessary for the maintenance of domestic industries of indispensability in time of war. A tariff may be defensible as a means for preventing the disturbance of “dumping” at other times. A tariff system, however, whose purpose is to curtail foreign trade in general and eliminate common competition is an economic restriction of very great danger. ”

“ Then when I return from the trip, we'll face another crucial test about our future in this global economy. Congress will reconvene soon to vote on ratifying GATT, the largest, most comprehensive trade agreement ever. GATT will require all nations to finally do what we've already done, to cut tariffs and other barriers and open up trade to our products and our services. It will level the export playing field for American companies and American workers all around the world and, in so doing, will create hundreds of thousands of new high-paying jobs right here at home. ”

“ Wearied with our long and unavailing efforts to enter into satisfactory commercial treaties with other nations, we have resolved at length to consult our own interests, and not to punish those other countries for the wrong they do us in continuing their high duties upon the importation of our products and manufactures, by continuing high duties ourselves, encouraging unlawful trade. We have had no communication with any Foreign Government upon the subject of these reductions. We cannot promise that France will immediately make a corresponding reduction in her tariff. ”

“ The public is thoroughly aroused and the work of reform is progressing as fast as ever any national movement of equal consequence. One of the most fortunate consequences of a justly protective tariff will be the tremendous enlargement of foreign trade. We pride ourselves upon the exportation of $1,082,000,000 of manufactured products, but 63 per cent, of these exports are crude and semi-crude ”

“ The United States has from the beginning of its government declared that one object of duties on imports is the encouragement of manufactures in the United States, and, whatever may be the dogma inserted in a political party platform, tariff legislation will continue to have a double object, revenue and protection. ”

“ The tariff has been revised, not on the principle of repelling foreign trade, but upon the principle of encouraging it, upon something like a footing of equality with our own in respect of the terms of competition, and a Tariff Board has been created whose function it will be to keep the relations of American with foreign business and industry under constant observation, for the guidance alike of our business men and of our Congress. American energies are now directed towards the markets of the world. ”

“ In the end these duties are paid by the producer. Every bushel of wheat, corn, or other grain, shipped over a railroad, pays part. Protective tariffs are so interwoven with the construction of railroads and the internal commerce of the country that they cannot be separated from the questions we have been discussing. All tariff duties are direct charges upon the productions of this country, and not on any other. Import duties are not paid by the people of the country from whence the goods are imported, but by our own people. ”

“ In order to provide generally for the modifications in the rules for determining whether goods imported into the customs territory of the United States are eligible for preferential tariff treatment under the CAFTA-DR, to provide preferential tariff treatment for certain other goods under the CAFTA-DR, and to make technical and conforming changes in the general notes to the HTS, the HTS is modified as set forth in Annex II of this proclamation. ”

“ If our tariffs are to be made equitable, and not necessarily burden our imports and hinder our trade abroad, frequent adjustment will be necessary for years to come. Knowing the impossibility of modification by act of Congress for any one or a score of lines without involving a long array of schedules, I think we shall go a long ways toward stabilization, if there is recognition of the Tariff Commission's fitness to recommend urgent changes by proclamation. ”

“ This country is definitely committed to the protective system and any effort to uproot it could not but cause widespread industrial disaster. In other words, the principle of the present tariff law could not with wisdom be changed. But in a country of such phenomenal growth as ours it is probably well that every dozen years or so the tariff laws should be carefully scrutinized so as to see that no excessive or improper benefits are conferred thereby, that proper revenue is provided, and that our foreign trade is encouraged. ”

“ This should secure an adequate revenue and adjust the duties in such a manner as to afford to labor and to all industries in this country, whether of the farm, mine or factory, protection by tariff equal to the difference between the cost of production abroad and the cost of production here, and have a provision which shall put into force, upon executive determination of certain facts, a higher or maximum tariff against those countries whose trade policy toward us equitably requires such discrimination. ”

“ No Party may, by reason of an exportation described in paragraph 1, refund, waive or reduce:
(a) an antidumping or countervailing duty that is applied pursuant to a Party's domestic law and that is not applied inconsistently with Chapter Nineteen (Review and Dispute Settlement in Antidumping and Countervailing Duty Matters) ;
(b) a premium offered or collected on an imported good arising out of any tendering system in respect of the administration of quantitative import restrictions, tariff rate quotas or tariff preference levels ”

“ All imports are subject to a tariff designed to protect the standard of living on this continent, which is far above that of any other nation on the planet. These tariffs are set by the highest industrial court after both houses of the industrial congress have ratified the recommendations of the chief executive of economic affairs, who is the joint appointee of these two legislative bodies. The upper industrial house is elected by labor, the lower by capital. ”

“ With enhanced competition, lower prices can be expected as well as greater consumer choice. As for industry, eliminating the obstacles to doing business and wiping out tariffs is going to be a great boon to manufacturing on both sides of the border. Markets will open that have been restricted, sources of raw material and parts that are now made more expensive by tariffs will be available at a lower cost. In short, this treaty is going to be overwhelmingly positive for both Canada and the United States. ”

“ Whatever may be its shortcomings as a complete measure of tariff reform, it must be conceded that it has opened the way to a freer and greater exchange of commodities between us and other countries, and thus furnished a wider market for our products and manufactures. ”

“ It consists in such a revision of the tariff as will deliver our manufacturing industries of those artificial burdens which increase the cost of the things they have to use in production, thus permitting them to obtain those things as cheaply and advantageously as their foreign competitors obtain them, and in that way giving them a fair chance for the export trade. ”

“ The common commercial policy shall be based on uniform principles, particularly with regard to changes in tariff rates, the conclusion of tariff and trade agreements relating to trade in goods and services, and the commercial aspects of intellectual property, foreign direct investment, the achievement of uniformity in measures of liberalisation, export policy and measures to protect trade such as those to be taken in the event of dumping or subsidies. The common commercial policy shall be conducted in the context of the principles and objectives of the Union's external action. ”

“ Investors, demanding interest payments from foreign debtors, will no longer be able to maintain the attitude that imports menace the prosperity of the country and should be cut down by the restrictions of the tariff. Exporters will find that the current is set against them, and that they can broaden their market only as they stimulate still greater growth in the import trade. ”

“ Foreign nations are fully cognizant of the fact that under section 2 of the tariff act the President is required, whenever he is satisfied that the treatment accorded by them to the products of the United States is not such as to entitle them to the benefits of the minimum tariff of the United States, to withdraw those benefits by proclamation giving ninety days' notice, after which the maximum tariff will apply to their dutiable products entering the United States. ”

“ They had also declared that the tariff should be reduced to the needs of honest, economical and efficient Government, that it should be so adjusted as to make free or bear as lightly as possible upon the necessaries of life and should be so arranged as to permit freer trade with the whole world, particularly with Great Britain and the United States. ”

“ Those who wish to benefit foreign producers are much more likely to secure that result by continuing the present enormous purchasing power which comes from our prosperity that increased our imports over 71 per cent in four years than from any advantages that are likely to accrue from a general tariff reduction. ”

“ It is time to readjust our trade and tariff policies to suit present conditions and to make them more effective instruments of our economic development.
I propose the creation of a Tariff Commission to study the present tariff rates carefully and in detail. This we should do while we present our side to the United States in our desire to readjust our trade relations with her. The Problem is not easy. It will take some time before we can expect concrete recommendations for the required changes. ”