Trade policy

“ We must strengthen the organization of our trade agencies and make changes in our domestic laws and international trade policy to promote free trade and the increased flow of American goods, services, and investments. ”

“ We need a stronger and simpler approach to the process of making and implementing trade policy, and we'll be studying potential changes in that process in the next few weeks. We've seen the benefits of free trade and lived through the disasters of protectionism. ”

“ A really wise policy should aim at making a country independent of foreign supply, but this should be effected without resorting to the pitiful shifts of customs duties and prohibitions. Industries must work out their own salvation, competition is the life of 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. ”

“ 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. ”

“ That freedom from restraint is calculated to give the utmost extension to foreign trade, and the best direction to the capital and industry of the country.
That the maxim of buying in the cheapest market and selling in the dearest, which regulates every merchant in his individual dealings, is strictly applicable as the best rule for the trade of the whole nation. [Pg 699]
That a policy founded on these principles would render the commerce of the world an interchange of mutual advantages, and diffuse an increase of wealth and enjoyments among the inhabitants of each State. ”

“ The government could then oversee the trade more easily, could collect its dues, insure good quality, and protect merchants more readily, and it could also make better use of trade as a weapon of policy, directing the stream of goods where it pleased, and so rewarding or punishing other states. ”

“ But the great national policy of putting a duty upon imports is, that it either keeps the foreign trade in our own hands, or draws something for the defence of the country from every foreigner who participates in it with us. ”

“ Subject to this proviso of the proper protection necessary to our industrial well-being at home, the principle of reciprocity must command our hearty support. The phenomenal growth of our export trade emphasizes the urgency of the need for wider markets and for a liberal policy in dealing with foreign nations. Whatever is merely petty and vexatious in the way of trade restrictions should be avoided. The customers to whom we dispose of our surplus products in the long run, directly or indirectly, purchase those surplus products by giving us something in return. ”

“ Under these trade arrangements a free or favored admission has been secured in every case for an important list of American products. Especial care has been taken to secure markets for farm products, in order to relieve that great underlying industry of the depression which the lack of an adequate foreign market for our surplus often brings. An opening has also been made for manufactured products that will undoubtedly, if this policy is maintained, greatly augment our export trade. ”

“ All legitimate public and private trade shall be protected. Control shall be exercised over foreign trade and the policy of protecting trade shall be adopted. Freedom of domestic trade shall be established under a unified economic state plan, but commercial speculation disturbing the market shall be strictly prohibited. State-owned trading organizations shall assume the responsibility of adjusting supply and demand, stabilizing commodity prices and assisting the people's co-operatives. ”

“ By the simultaneous abandonment of the protective policy by Great Britain and the United States new and important markets have already been opened for our agricultural and other products, commerce and navigation have received a new impulse, labor and trade have been released from the artificial trammels which have so long fettered them, and to a great extent reciprocity in the exchange of commodities has been introduced at the same time by both countries, and greatly for the benefit of both. ”

“ A second general cause accounting for the world’s progress in commerce is political—the commercial policy followed by the leading nations of the world. Up to the nineteenth century, practically every country strove to promote its trade, navigation interests, and its power as a nation by means of the mercantile system,—a system of strict and detailed regulation of foreign trade by means of tariffs and navigation laws. Each country strove to determine the nature of its international trade, and endeavored to carry on its commerce in its own ships. ”

“ In the course of this communication reference has more than once been made to the policy of this Government as regards the extension of our foreign trade. It seems proper to declare the general principles that should, in my opinion, underlie our national efforts in this direction.
The main conditions of the problem may be thus stated:
We are a people apt in mechanical pursuits and fertile in invention. We cover a vast extent of territory rich in agricultural products and in nearly all the raw materials necessary for successful manufacture. ”

“ On the other hand, there are imports so entirely of foreign origin, and so free from considerations of competition with domestic industry, that a large revenue may be raised upon them in the custom-house, without disturbing the freedom or equity of international trade. ”

“ The import of manufactured articles became more and more essential, and alike for the importing country and for the exporting countries trade was more lucrative in a large area with a centralised and unified administration, freed from tariff hindrances imposed by petty states. ”

“ I believe that, if only we could shake off the fetters of a narrow and pedantic theory, and freely reshape our own system of import duties on principles of obvious common sense, we should be able at one and the same time to promote trade within the Empire, to strengthen our hands in commercial negotiations with foreign countries, and to render tardy justice to our home industries.
The Free Trader goes on the principle of placing duties on a very few articles only, articles, generally, of universal consumption, and of making those duties very high ones. ”

“ But do we, civilized beings, indulge in the absurd and barbarous notion that we must own the countries with which we wish to trade? Here are our official reports before us, telling us that of late years our export trade has grown enormously, not only of farm products, but of the products of our manufacturing industries ”

“ But in regard to those duties on foreign commodities which do not operate as protection, but are maintained solely for revenue, and which do not touch either the necessaries of life or the materials and instruments of production, it is his opinion that any relaxation of such duties, beyond what may be required by the interest of the revenue itself, should in general be made contingent upon the adoption of some corresponding degree of freedom of trade with this country, by the nation from which the commodities are imported. ”

“ Other countries showed but a languid desire for the products which were then our staple exports, and we had great need of the foreign wares composing our509 imports. We could not afford even to discriminate against the importation of manufactured goods, with an idea of protecting native manufactures; our manufactures were then so weak that a policy of high protection, to exclude foreign wares, would have caused serious distress to the consumers at home. ”

“ That, while providing revenue for the support of the general government by duties upon imports, sound policy requires such an adjustment of these imports as to encourage the development of the industrial interest of the whole country; and we commend that policy of national exchanges which secures to the working men liberal wages, to agriculture remunerative prices, to mechanics and manufacturers an adequate reward for their skill, labor, and enterprise, and to the nation commercial prosperity and independence. ”

“ Emphasis is laid instead on the fact that in the last analysis the trade is of goods for goods, not of money for goods, and that a tariff on imports reduces, not only imports, but exports also,—that it merely interrupts temporarily the virtual barter between nations. ”

“ An unrestrained intercourse between the States themselves will advance the trade of each, by an interchange of their respective productions, not only for the supply of reciprocal wants at home, but for exportation to foreign markets. The veins of commerce in every part will be replenished, and will acquire additional motion and vigor from a free circulation of the commodities of every part. ”

“ It is in America's economic and national security interests to promote commerce by strengthening our relationships with our trading partners, vigorously enforcing our Nation's trade laws, improving the overall conditions for competition and trade, and ensuring the strength of our manufacturing and defense industrial bases. For many years, the United States has not obtained the full scope of benefits anticipated under a number of international trade agreements or from participating in the World Trade Organization. ”

“ It was shown, however, in our analysis of the effects of international trade, as it had been often shown by former writers, that the importation of foreign commodities, in the common course of traffic, never takes place, except when it is, economically speaking, a national good, by causing the same amount of commodities to be obtained at a smaller cost of labour and capital to the country. To prohibit, therefore, this importation, or impose duties which prevent it, is to render the labour and capital of the country less efficient in production than they would otherwise be ”

“ The idea that a few years ago found great acceptance in Europe, and undoubtedly influenced the commercial policy of the different states—namely, that increased restrictions on the importation and competitive sales of foreign products and the resort to bounties on exports would conjointly stimulate industries, relieve their markets from anything like overproduction, and inaugurate a period of general prosperity—has utterly failed of realization, and been entirely different from what was anticipated. ”

“ Leaving the matter of price and quality to be dealt with by the industrial exporter, as must be the case, the influence of the Government remains as the most important outside factor in determining the prosperity of this trade. Under the control of the Government come the treaty-making power, with its bid for fa [Pg 888] vorable reception of American products; the official attitude toward facilities for the manufacturing of exports and toward transportation ”

“ Consideration of this fact and some reflection upon the necessary effects of a scientific tariff system and a foreign service alert and equipped to cooperate with the business men of America carry the conviction that the gratifying increase in the export trade of this country is, in substantial amount, due to our improved governmental methods of protecting and stimulating it. ”

“ Our diversified productions, however, are increasing in such unprecedented volume as to admonish us of the necessity of still further enlarging our foreign markets by broader commercial relations. For this purpose reciprocal trade arrangements with other nations should in liberal spirit be carefully cultivated and promoted. ”

“ I disagree with both these extremes. I hold that a properly adjusted competition between home and foreign products is the best gauge by which to regulate international trade. Duties should be so high that our manufacturers can fairly compete with the foreign product, but not so high as to enable them to drive out the foreign article, enjoy a monopoly of the trade, and regulate the price as they please. ”

“ No doubt that means hard work, an intimate acquaintance with the details of our industry and trade, an eye upon the proceedings of foreign countries. A modern tariff, if it is to be really suitable to the requirements of the nation adopting it, must be the work of experts. ”

“ The case which we have just examined, is an example in how remarkable a manner every cause which materially influences exports, operates upon the prices of imports. According to the ancient theory of the balance of trade, and to the associations of the generality of what are termed practical men to this day, the sole benefit derived from commerce consists in the exports, and imports are rather an evil than otherwise. ”

“ One of the chief complaints against the protective system is its alleged hindrance to foreign trade and a foreign market for our own products. It is argued that if we could import raw material from other countries free, and manufacture such raw material into products for use, we could export them at great profit, and thus secure a standing in the markets of the world. ”

“ Trade implies at least two parties. To be free, it should be fair, equal, and reciprocal. But if we throw our ports wide open to the admission of foreign productions, free of all duty, what ports of any other foreign nation shall we find open to the free admission of our surplus produce? We may break down all barriers to free trade on our part, but the work will not be complete, until foreign powers shall have removed theirs. ”