Music Trade Review

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THE
10
MUSIC
TRADE
REVIEW
NOVEMBER 23, 1918
The Relation of the Government to Foreign Trade
A Statement of the Policies Which Will Be Essential to the Future Expansion
of Our Foreign Commerce, as Outlined by H. C. Lewis in an Address Before
the Annual Convention of the American Manufacturers' Export Association
The functions of governments in the develop-
ment of foreign trade following the war will
certainly be important, though just what they
should be we may not now be able to deter-
mine. The active participation of governments
in world trade is fraught with certain danger,
and we should encourage its development only
along sound economic lines or as the action
of other governments may make it necessary.
Our Government may properly and very advan-
tageously investigate markets and export pos-
sibilities for the information and encouragement
of our merchants and manufacturers.
In a
broad way, however, the ultimate permanence
and satisfactory development of our foreign
commerce must be left to the individual initia-
tive and enterprise of American concerns.
We have those qualities in abundance, and
they should be encouraged and developed by ne-
cessity for exercise—not softened or coddled
by Government assistance in the realm of legiti-
mate business.
Individual strength, tenacity
and endurance laid the foundation of our mighty
country, and though we may have strayed from
our original path, we must return to its prin-
ciples if we are to remain a strong people and
a great nation. Individual development, in com-
merce as in personal matters, may also afford
our best defense against social and economic
evils and conflicts which may attend the restora-
tion of normal conditions in industry.
Assuming, however, that there is a certain
need for the Government's practical interest in
foreign trade, let us consider, first, how it may
best be organized and applied.
Co-ordinate and Co-operate
It seems proper for us to suggest to the va-
rious departments in Washington that they at
once begin to co-ordinate their information and
co-operate in their activities. There is the De-
partment of Commerce, devoted entirely to the
important questions of business and trade.
There is the Department of State, with its pre-
dominant position in foreign affairs and with a
most important relation to business as it af-
fects our foreign relations or as our foreign re-
lations are affected by business. There is our
Tariff Commission, with its great questions of
foreign tariffs, as well as our own domestic tariff
policies. There is the Federal Trade Commis-
sion, with its large and general control of busi-
ness policies. There is the Treasury Depart-
ment, interested in the movement of trade in the
various parts of the world'as it may affect ex-
change and revenues. There is also the Ship-
ping Board, with its most important relation to
foreign commerce and its great responsibility
toward the American exporter and importer.
To some extent, each of these departments is
working independently of the others. A num-
ber of them are independently acquiring detailed
information covering practically the same fields
—statistical and otherwise—giving advice, issu-
ing orders, commending or criticizing, and all
without full co-operation in policies or co-ordi-
nation of efforts. This causes much unneces-
sary expense to the tax-payer and brings les-
sened efficiency when the greatest is needed.
So far as our foreign trade is concerned, this
lack of co-ordination levies unnecessary expense
upon it, which, if continued when international
competition is resumed after the war, will con-
stitute a most serious handicap to American en-
terprise.
We should therefore urge that the above de-
partments, and all other administrative bodies
having to 1 do with foreign trade, get together and
unite their efforts. As individual strength and
enterprise are important to our business de-
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velopment, so are concentration of effort and
economy of expenditure in the activities of our
Government equally important.
Co-operation, co-ordination, concentration and
harmony will bring great results, and nothing
else will answer at this time.
Definite Limits Necessary
Having organized our governmental ma-
'chinerj'—not with another department or com-
mission, but with a reduction of detailed organ-
ization if possible and by co-ordinating what re-
mains—let us consider the limits within which
this machinery should operate. There should
be definite limits to practical Government ac-
tivity in foreign trade, as in domestic trade.
The same principle applies to both in effect, ex-
cept that the possibility of overstepping these
limits in foreign trade creates a greater danger
than will be the case in domestic matters. Too
much Government participation in our foreign
trade invites or compels similar participation by
other governments. The resulting danger from
this is apparent. We must not create oppor-
tunities for trade wars or make world commerce
the basis for another world war.
We Americans occupy a unique and leading
position to-day, which we can hold if we are
worthy and which the efforts and activities of
our Government will make commendable in the
eyes of other nations if a wise policy is pur-
sued. Let us lead toward sane, constructive
development and avoid the dangers of trade
wars, with their resulting inevitable losses.
As to the method of defining the proper limits
of Government activities in foreign commerce,
I would suggest that the Government agency, as
finally organized and supported by other depart-
ments, consult fully and freely with representa-
tives of important organizations dealing with
foreign trade. The committees appointed by
these organizations should at least be largely
composed of men having personal knowledge of
foreign countries and foreign trade and with
broad vision. With the assistance and advice
of such men the limits of a sane, safe and yet
constructive policy can be determined.
Expansion Should Be Encouraged
Among the important purposes of our Gov-
ernment should be a definite policy of en-
couragement to Americans to go abroad in the
interests of our foreign trade. This should be
actual encouragement and support, and not
merely verbal statements. An able, reputable
American citizen living in a foreign country
offers the example which we wish to give the
world of our methods, of our policies and of our
ideals. He must be respected as a representa-
tive of our great country.
I will give an example of what a Govern-
ment agency, in sole control of foreign trade
details and supported by all other Government
departments might do.
In the exigencies of war, and even before,
many of the smaller neutral countries have de-
veloped industries not warranted by their nat-
ural resources nor even by any great national
consumption. These are economically unsound.
They are generally comparatively small enter-
prises, but are protected by prohibitive tariff
duties or by decrees or laws granting them prac-
tical monopoly. The nationals of those coun-
tries pay an enormous price for the goods pro-
duced, and the legitimate producer in a logical
manufacturing country loses a market. There
are, therefore, two substantial losses affecting
many people, and the gains are for a few pre-
ferred individuals who have taken advantage of
or who have been able to bring about an ab-
normal situation. Possibly the United States
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is not without fault in this respect. If so we
should sacrifice what is uneconomical and gain
the greater logical market.
Correcting Economic Errors
Investigation by competent and experienced
Government agents might develop these cases
and proper Governmental action correct the er-
rors—for errors they are in a broad economic
sense. There is no country without natural
resources to develop, and development along
lines not justified by national resources repre-
sents an economic loss and a world danger. I
am of the opinion that to-day our country has
more to lose and more to fear from illogical, un-
economic manufacturing and financial develop-
ment the world over than from the world's legiti-
mate competition. We can avoid this danger by
helping others as well as ourselves. Here is a
great opportunity for legitimate governmental
action.
Our Government officials have a great oppor-
tunity and a great responsibility, and upon their
final decision and action much depends which
may affect not only our own country but the
whole world. Let us hope for and encourage
real co-operation among all—not merely among
limited groups. We are entitled to just what
we deserve. If we endeavor to get more, we
act unwisely and lose in the end; if we get less,
we are weak and unworthy.
May I respectfully call attention to the en-
tirely inadequate compensation paid to the rep-
resentatives and employes of the Department of
Commerce? These men are loyal, patriotic and
generally of high intelligence. First of all they
deserve adequate compensation for their work,
and that they are not now receiving. Let us
all frankly recognize that we cannot now gen-
erally obtain, nor permanently retain, the serv-
ices of able men unless they are properly paid.
Concentration of activities through the con-
solidation of the present work being done by va-
rious departments in Washington would bring
very great saving in cost and yet allow of much
higher compensation for those doing this work.
Men of Ability Needed
It will be far better, in my judgment, for the
Department of Commerce to conduct its affairs
with a smaller staff, better paid and consequent-
ly of greater ability, than to be forced by Con-
gress to maintain its present policy in respect
to the payment of its people. That department
needs men of some extensive industrial and busi-
ness experience. It may and will educate many
young men, but their work must of necessity
be guided and supervised by men of real prac-
tical experience if the work of the department
is to be wisely constructive. Let us remem-
ber that the policy of the nations which will be
our chief competitors will be to use the services
of able and practical men in guiding and direct-
ing their foreign-trade efforts and policies.
Let me conclude by repeating in substance
the following points:
The safe function of our Government activity
in foreign business should be very carefully con-
sidered and its limits distinctly defined until the
action of other nations makes it necessary to
extend these limits.
The representatives of our Department of
Commerce must be at least equal in position
and ability to those of other governments. This
requires proper compensation for their services.
The position of the Department of Commerce
should be fully recognized by other Government
departments, so that their activities may not
clash.
All departments should co-operate and co-or-
dinate in their work affecting foreign interests.
ORGANS
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