TRADE AGREEMENTS EXTENSION ACT OF 1955

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP59-00224A000100310002-9
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 88
• Document Creation Date: November 11, 2016
• Document Release Date: January 19, 1999
• Sequence Number: 2
• Publication Date: February 14, 1955
• Content Type: REPORT

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TRADE AGREEMENTS EXTENSION ACT
0 F 1955
REPORT
COMMITTEE ON WAYS AND MEANS
HOUSE OF REPRESENTATIVES
TO ACCOMPANY
H. R.1
A BILL TO EXTEND THE AUTHORITY OF THE PRESIDENT
TO ENTER INTO TRADE AGREEMENTS UNDER SECTION
350 OF THE TARIFF ACT OF 1930, AS AMENDED, AND FOR
OTHER PURPOSES
FEBRUARY 14, 1955.-Committed to the Committee of the Whole House
on the State of the Union and ordered to be printed
UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON : 1955
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CONTENTS
Page
1. General statement_____________________________________________
2
A. Principal features of H. R. 1_____________________________
2
B. Explanation of provisions of the bill______________________
2
C. History of the legislation ---------------------------------
6
II. Need for H. R. 1----------------------------------------------
6
A. In general--------------------------------------------
6
B. Agriculture--------------------------------------------
8
C. Labor------------------------------------------------
9
D. Commerce and industry_________________________________
10
E. Appendixes-------------------------------------------
12
III. Technical analysis of H. R. I as reported_________________________
13
IV. Changes in existing law-----------------------------------------
18
Minority views----------------------------------------------------
23
Appendix A: Criticisms of trade -agreem?nts program__________________
36
Charge: United States tariffs are already too low__________________
36
Charge: The trade-agreements program is not r ciprocal -----------
36
Charge: Passage of H. R. 1 should wait for GATT negotiation---___
44
Charge: Passage of H. It. 1 should await the outcome of Japanese
tariff negotiations --------------------------------------------
44
Charge: Defense industries and skills are not adequately protected__
44
Appendix B:
The executive department's testimony and support of H. R. 1 ------
45
The testimony of business and industry in support of H. R. 1------
50
The testimony of agricultural groups in support of H. R. 1 -_ - - _ _ - _ -
54
The testimony of labor in support of H. R. 1______________________
55
The testimony of public-interest groups__________________________
58
Overwhelming press support of H. R. 1___________________________
59
Appendix C:
Accomplishments of the trade-agreements program----------------
62
United States exports of products subject to trade-agreement conces-
sions-------------------------------------------------------
64
Appendix D: How a trade agreement is made______________ -------------------------
81
First step-Obtaining information on trade with country X---------
81
Trade-agreements committee makes recommendations--------------
82
Interested persons present views_______________________________
82
How recommendations are arrived at_____________________________
83
Recommendations go to the President____________________________
84
Actual bargaining begins_____________________________________
84
Bargaining with several countries at once-------------------------
85
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84TH CONGRESS HOUSE OF REPRESENTATIVES J REPORT
1st Session No. 50
TRADE ' AGREEMENTS EXTENSION ACT OF 1955
FEBRUARY 14, 1955.-Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
Mr. COOPER, from the Committee on Ways and Means, submitted
the following
REPORT
The Committee on Ways and Means, to whom was referred the bill
(H. R. 1) to extend the authority of the President to enter into trade
agreements under section 350 of the Tariff Act of 1930, as amended,
and for other purposes, having considered the same, report favorably
thereon with amendments and recommend that the. bill as amended
do pass.
The amendments are as follows:
Page 3, beginning in line 4, strike out ", except as authorized by
subparagraph (B) of this paragraph,"
Page 3, line 8, strike out the period and insert in lieu thereof a
colon and the following:
Provided further, That the enactment of the Trade Agreements Extension Act of
1955 shall not be construed to determine or indicate the approval or disapproval
by the Congress of organizational provisions of any foreign trade agreement
entered into under this section.
Page 4, line 12, strike out "not being" and insert in lieu thereof
"normally not".
Page 4, line 13, strike out "being" and insert in lieu thereof
"normally".
Page 4, line 16, insert after the period the following:
This clause shall not apply with respect to any article unless it is designated in
the list required by section 3 (a) of the Trade Agreements Extension Act of 1951,
as amended (19 U. S. C., sec. 1360 (a)), for possible consideration as an article
which is normally not imported into the United States or is normally imported
into the United States in negligible quantities.
Page 8, line 6, strike out "may" and insert in lieu thereof "shall, as
soon as practicable,".
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2 TRADE AGREEMENTS EXTENSION ACT OF 1955
Page 10, line 12, after "notice of intention" insert "to negotiate".
Page 11, strike out line 9 and all that follows down through line 16
on page 1.2.
A...Principal features of H. R. 1
The purpose of H. R. 1 is to continue to June 30, 1958, the authority
of the ]."resident to enter into trade agreements. The present author-
ity (extended by Public Law 464, 83d Cong.) terminates on June 12,
1955. In addition to the extension of the trade-agreements authority,
the principal features of H. R. 1 are as follows:
1. The President would be authorized to negotiate tariff reductions
by any 1 of 3 alternative methods, which may not be used cumu-
latively.
(a) The first method authorizes the President to reduce by a total
of 15 percent tariff rates existing on July 1, 1955, in stages of not more
than 5 percent in each of the 3 years of the authority;
(b) An alternative authority to that provided in (a) above is the
authorization to reduce tariffs by 50 percent of the rate prevailing on
January 1, 1945, but only in the case of those products normally not
imported or normally imported in negligible quantities;
(c) As a third alternative the President is authorized to negotiate
reductions in those rates which are higher than 50 percent of the value
of an import to a rate equivalent to 50 percent.
2. In, the case of the announced trade agreement involving Japan,
the bill authorizes the same decreases in rates of duty (i.e., 50 percent
of the rate existing on January 1, 1945) as are authorized under
existing law, even though the agreement is entered into after June 12,
1955.
3. The reduction authority referred to in paragraphs 1 and 2 above
is subject to the peril-point and escape-clause procedures as contained
in present law.
4. Tlae President is required to avoid to the maximum extent he
deems practicable the subdivision of existing tariff classification
categories to prevent undue complication of the present tariff struc-
ture.
5. The President would be required to submit to Congress an
annual report on the trade-agreements program. This report is to
contain., among other things, information on modification of trade
agreements, including a report on the incorporation of escape clauses
in existing agreements and information relating to agreements en-
tered into.
B. Explanation of provisions of the bill
Under present law, the President's authority to enter into foreign
trade agreements expires June 12, 1955. The bill extends the period
during which the President will be authorized to enter into trade
agreements from June 12, 1955, through June 30, 1958.
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TRADE AGREEMENTS EXTENSION ACT F 1 5
EXTENT OF PRESIDENT'S AUTHORITY
Under present law the President is authorized to decrease rates of
duty by 50 percent of the levels existing on January 1, 1945. The bill
would continue this authority after June 12, 1955, only (1) in the case
of products which are normally not imported or are normally imported
in negligible quantities into the United States, and (2) in the case of
products included in the trade agreement as a result of the negotiations
which have already been announced in which Japan will be a party
(in case these negotiations are not concluded by June 12, 1955). The
bill would continue unchanged the authorization in present law where-
by the President can increase rates of duty by up to 50 percent of the
levels existing on January 1, 1945.
As under present law, the President would be authorized to enter
into foreign trade agreements with foreign governments or instru-
mentalities thereof. The language continuing this authority has been
expressed so as to spell out in the section the fact that the President
can in entering into foreign trade agreements include general provisions
of the kind which have heretofore been included in such trade agree-
ments since the inception of the trade-agreements program in 1934.
In the past it has been necessary, to make various changes in such
general provisions in order to keep pace with the changes of devices
and practices in foreign countries. The provisions specified in this
subparagraph are illustrative of types of provisions which are.necessary
in order that the President may be able to meet effectively new methods
of discrimination and other barriers against American exports. An
important purpose of these provisions is to protect against impair-
ment the tariff concessions which the United States obtains in trade
agreements.
The bill, H. R. 1, as reported, clearly provides that no such general
provision shall be given effect in the United States in a, manner
inconsistent with existing legislation of the United States. The
purpose of the committee amendment to this proviso is to make it
clear that provisions of existing law such as section 22 of the Agri-
cultural Adjustment Act (7 U. S. C., sec. 624), safeguarding domestic
agricultural programs from material interference from imports, hoof-
and-mouth disease quarantine laws (19 U. S. C., sec. 1306), and section
8e of the Agricultural Marketing Agreement Act (7 U. S. C., sec. 608e),
providing for the regulation of the grade, size, quality, and maturity
of certain fruits and vegetables imported into the United States and
other like provisions of existing law, will prevail despite any provision
in a trade agreement.
The bill also provides that its enactment shall not be construed to
determine or indicate the approval or disapproval by the Congress of
organizational provisions of any foreign trade agreement entered into
under the authority which it grants, such as the organizational
provisions of the General Agreement on Tariffs and Trade.
That part of the bill which authorizes the President to carry out a
trade agreement by proclamation is a continuation of existing law.
In addition to the President's authority as to the reduction of duties
described above, he would also be authorized to reduce duties by 15
percent from the rates existing on July 1, 1955. Also, the President
would be authorized to reduce any rate of duty above 50 percent of
the value of an imported product to 50 percent of such value.
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4 TRADE AGREEMENTS EXTENSION ACT OF 1955
Except for the reductions which might be made in the trade agree-
ment involving Japan, reductions under the three alternative methods
must be made gradually. None of these three alternatives for reduc-
ing duties which would be given to the President by the bill may be
used cumulatively, If the total amount of reduction is 15 percent or
less, the reduction during any 12 months cannot exceed 5 percent. If
the total amount of reduction is more than 15 percent, then no more
than one-third of this reduction can be given effect during any 12-
month period.
The requirements of existing law for full public notice (including a
list of products on which concessions might be made by the United
States), public hearings, and peril-point determinations by the Tariff
Commission are not changed by H. R. 1. Neither is the present
requirement that the President must report to the House Committee
on Ways and Means and the Senate Committee on Finance whenever
a reduction exceeds that which the Tariff Commission believes could
be made without causing or threatening serious injury to the domestic
industry (peril point). Likewise, the escape-clause provision of
existing law continues unchanged. Moreover, H. R. 1 would not
affect the present provision that no reduction shall be made on any
article if the President finds that such reduction would threaten domes-
tic production. needed for projected national-defense requirements.
The committee gave extensive consideration to amendments to
the escape-clause provisions of existing law, but decided that it, was
neither necessary nor desirable to change the law.
Under existing law, the findirgs of the Tariff Commission that a
product on which a concession has been granted is, as a result in
whole or in part of the customs treatment reflecting such concession,
being :imported in such increased quantities as to cause or threaten
serious injury to the domestic industry producing like or directly
competitive products, together with its recommendation regarding
withdrawal or modification. of the concession, go to the President.
In making his determination whether to withdraw or modify a
concession, the President must take into account all relevant factors,
including our national-defense requirements, requirements for carry-
ing on successfully the foreign relations of the United States, and the
necessity for maintaining and strengthening the domestic economy
of the United States. Consequently, he secures the individual views
of the Departments of Agriculture, Commerce, Defense, Interior,
Labor, Treasury, and State and the Foreign Operations A.dmin~istra-
tion, in order that his decision whether to withdraw or modify the
concession may be based upon all the information available in the
Government. The Departments of Agriculture, Commerce, Interior,
and Labor have primary responsibility for providing economic
information and views relating to domestic activity, while the other
agencies submit data and views concerning the other factors.
The committee believes that the President should give full con-
sideration to the Tariff Commission's findings regarding injury. If
he believes that these findings should be further developed, or if new
information relevant to such findings are disclosed, in the committee's
opinion he should continue his practice of submitting such data to
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the Tariff Commission for supplemental investigation and findings
where appropriate. The other factors, relating to the overall national
interest, are, of course, outside the jurisdiction of the Tariff Com-
mission, and must be weighed by the President after receiving the,
views of the various departments. The committee is of the opinion
that a President, who has the authority to determine where and when
American Armed Forces may be employed in the Formosa Straits in
the interest of our national security, can be trusted to weigh factors
relating to the national interest in terms of withdrawing a tariff
concession.
Even on the question of injury, the President must by law make the
determination in the event of a 3-3 split among the Tariff Com-
missioners.
Findings on the question whether injury is caused or threatened
by imports resulting from tariff concessions are based on factual
material. However, proper weight must be given to such facts,
reasonable inferences drawn therefrom, and, finally, there must be
an exercise of judgment. Different weight can be given to the same
facts, different inferences can be drawn from the same facts, and
differing judgments can result. Otherwise all administrative or judi-
cial judgments would be unamimous and be affirmed on appeal. In
practically every field where administrative or judicial findings are
involved, the Congress has provided for some review of those findings,
either by courts or by the President. In the committee's opinion it
would be undesirable to depart from this practice in the case of the
escape clause. Your committee believes that the President should
not be compelled as a matter of law to accept findings of the Tariff
Commission where it is his opinion that they are not soundly based,
although in the committee's opinion he should give full consideration
and proper weight to such findings.
Due to the expressed concern from many quarters over the admin-
istration of the escape clause, it is your committee's intent to keep
this matter under continuing study.
Under H. R. 1, the President would submit to the Congress an
annual report on the operation of the trade-agreements program. In
addition to reporting on the progress made in inserting the escape
clause in existing agreements 1 (on which he now reports semiannually)
the report would include information on new negotiations, modifica-
tions made in duties and import restrictions of the United States,
reciprocal concessions obtained and other information on the trade-
agreements program.
The President, under H. R. 1, is to avoid, to the maximum extent
practicable and consistent with the purpose of the legislation, the
subdivision of classification categories. In previous years, particu-
larly during the period when only straight bilateral agreements were
I A message from the President to the Congress on January 10 1955 (H. Doe. No. 84, 84th Oong.) indi-
cates that all except four agreements, those with Ecuador, Hontfuras, El Salvador, and Guatemala, now
have a satisfactory escape clause. The agreement with Ecuador is now scheduled to terminate on July 18,
1955.
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6 TRADE AGREEMENTS EXTENSION ACT OF 1955
concluded, our tariff structure has been complicated by breaking up
existing classifications into various parts.
0. History of the legislation
In 1.934 Congress empowered the President to enter into trade
agreements with other countries for a period of 3 years. The Presi-
(tent's tariff-reducing authority was limited to 50 percent of the rates
then in effect. This authority was extended by Congress in 1937,
1940, and 1943. Between 1934 and 1945 trade agreements were
negotiated with 29 countries.
In 1945 Congress extended the President's authority and increased
it. He was authorized to reduce tariffs to 50 percent of the rates
prevailing on January 1, 1945.
At the present time the United States has trade agreements with
42 countries of which 32 are parties to the General Agreement on
Tariffs and Trade. These countries and the United States carry on
at least 80 percent of world trade. The agreements negotiated cover
approximately 58,000 items with a trade probably surpassing $40
billion in 1953.
In 1953 President Eisenhower asked Congress for a 1-year renewal
of the trade-agreements authority, pending a comprehensive reexam-
ination of the economic foreign policy of the United States to be
undertaken by a bipartisan commission. The Commission on Foreign
Economic Policy, under the chairmanship of Mr. Clarence B. Randall,
was established, with members drawn from both Houses of Congress
and from the public. After extensive investigations it presented its
recommendations to the President on January 23, 1954.
Based on these recommendations, the President outlined his foreign
economic policy to Congress in his message of March 30, 1954. One
of the recommendations was the extension of the trade-agreements
legislation as outlined in H. R. 1. The present act was extended for
1 year. The President has again, on January 10, asked the Congress
to provide the authority contained in H. R. 1.
Full and complete hearings were held on H. R. 1 by the committee
beginning on January 17, 1955, and concluding on February 7, 1955.
Testimony was received from Cabinet officials and witnesses repre-
senting all segments of our economy.
In the executive sessions that followed the hearings careful consid-
eration was given to the testimony and views presented to the
committee.
A. In general
Since 1934 the Reciprocal Trade Agreements program has been
an essential part of our foreign economic policy. Our foreign eco-
nomic policy and our overall foreign policy cannot be disassociated.
As President Eisenhower has stated:
If we fail in our trade policy, we may fail in all. Our domestic employment,
our standard of living, our security, and the solidarity of the free world-all are
involved.
For our own economic growth we must have continuously expanding world
markets; for our security we require that our allies become economically strong.
Expanding trade is the only adequate solution for these two pressing problems
confronting our country.
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An expanded foreign trade is in our own enlightened self-interest
just as much as it is in the interest of the peace and security of the
other nations of the free world.
As the Secretary of State declared:
The failure, at this stage of world affairs, to rededicate our Nation to liberalize
trade policies, and to do so for a 3-year term would have grave consequences.
The Secretary of Defense in his testimony before the committee
stated that passage of H. R. 1 is an important measure in strengthen-
ing our common defense against Communist aggression. Ile stated:
The stronger our allies are economically and militarily the better for both them
and ourselves * *
International trade must be a two-way street. Such trade provides the most
effective way to improve our relations with our allies on a long-range basis. It
is just as important as any military agreements which we might work out.
Today perhaps there is no other country in the world that has as
much at stake in an expanding world trade as has the United States.
We export about 20 percent of the goods in world trade and import
about 15 percent of such goods. If we act with wisdom, courage,
and forbearance in the formulation of our foreign economic policy,
we will find that we have promoted the security and welfare of the
United States.
Our position in the world today is one that we did not seek but
which has nevertheless been thrust upon us. With it has come the
responsibility to pursue policies that are most conducive to the cause
of peace and the advancement of human welfare. The most short-
sighted thing we could do from the standpoint of our national
defense is to cast our allies between.a curtain of high tariff protection
on the one hand and an iron curtain of engulfment on the other.
The United States as the greatest creditor nation in the world,
should and must take the leadership in enlarging world trade.
The main economic impediment to an expanded foreign market for
our own production is the shortage of dollars on the part of friendly
foreign nations and their inability to make their currencies convertible.
The most practical way of helping to reduce and eventually eliminating
these problems is the lowering of trade barriers on a collective basis
by the free nations of the world. The trade and tariff restriction
policies of each country in the free world have an effect on free world
trade. However, those of the United States are especially significant
because of our outstanding position of leadership and economic
importance.
Contrary to expressed opinions that we are totally self-sufficient
in the United States, the truth is that we are not. Our emergence as
a world power has been accompanied by an increasing engagement in
world trade. The natural resource requirements of our American
economy, our population growth, and our ever-increasing per capita
consumption have caused us to look to our neighbors for part of what
we consume. They in turn look to us for the products of our farms,
factories, and commerce.
One of the major restraints on an expanding foreign market for
American goods in the past has been an unfavorable balance of pay-
ments resulting from the dollar gap between imports and. exports.
This gap must eventually be closed. It can be closed (1) by increasing
the sale of foreign goods in this country, (2) by decreasing the sale of
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8 TRADE AGREEMENTS EXTENSION ACT OF 1955
our goods in foreign countries, or (3) by outright lifts of dollars to
foreign countries. Decreasing our exports would in ure our economy
and reduce our standard of living and that of our allies by decreasing
American production and employment. As a result, production and
employment overseas would be similarly affected.
We are properly diminishing, not increasing, outright gifts of dollars.
This means we must accept foreign goods if we are to continue to
increase exports and avoid continuation of outright dollar grants.
The creation of a dependable international balance of payments is a
problem that offers no simple solution. The problem must be attacked
at each of its many aspects.
The committee, through its study of the problem and from the testi-
mony, of witnesses, is impressed with the crucial importance of remov-
ing the atmosphere of instability from our foreign trade policies. This
instability is a factor in slowing down the development of an improved
system of world trade. Other countries, uncertain of what economic
policies the United States will follow hesitate to expand. their produc-
tion of those products destined for the United States market. Unsure
of their continuing capacity to earn dollars in the event the United
States should turn away from a policy of promoting trade in the free
world, other countries are also hesitant to relax their exchange restric-
tions. The early enactment of the bill, renewing the authority of the
President to enter into trace agreements, will have a stabilizing effect
upon our international relations and increase confidence throughout
the free world.
H. R. 1 is considerably more than a manifestation of America's ex-
pression of good faith to our allies. It is considerably more than a
demonstration to international communism of the free world's eco-
nomic unity. If. R. 1 is a gradual but forthright step in the direction
of assuring the products of American agriculture, labor, and industry
an expanding market which is essential to increasing American pro-
ductivity.
The authority granted to the President, under H. R. 1 is for the
purpose of securing a higher level of two-way trade. Thus, we will
be able to sell and receive payment for our exports and have an
increasing volume of investment abroad to assist economic develop-
ment overseas and to yield returns to us of greater freedom from
restrictions and controls in international trade.
In seeking to develop increasing domestic prosperity, free-world
strength and international peace, H. R. 1 is part of the answer to each
of these objectives. Every segment of our American economy has a
vital interest in the attainment of these purposes.
B. Agriculture
There is probably no segment of our economy that has a greater
stake in foreign trade than agriculture. It has been estimated that
annual exports of agricultural commodities represent the production`
of from 50 to 60 million cultivated acres. This is an area equivalent
to the combined cultivated land of Mississippi, Tennessee, Louisiana,
Kentucky, Alabama, Florida, Georgia, North Carolina, South Caro-
lina and. Virginia. Putting it another way, our agricultural exports
provide a market for the produce of one out of each 10 acres of crop-
land. In 1951, when our agricultural exports ran to $4 billion, this
was the equivalent of $1 out of each $8 in cash farm receipts in the
United States.
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TRADE AGREEMENTS EXTENSION ACT OF 1955 9
The importance of agricultural exports to agriculture is further
stressed in the excerpts from the testimony of major farm or~aniza-
tions which is contained in appendix B. It will be noted in this
appendix that in 1953, of our total production we exported 45 percent
of our rice, 26 percent of our tobacco, 24 percent of our cotton, 21
percent of our soybeans and products, 19 percent of our wheat and
flour, 18 percent of our lard, 17 percent of our barley, 6 percent of our
raisins, and about 5 percent of our pears and apples. It can be seen
from these statistics that we export about one-fourth of our total
production of some major agricultural commodities.
Since 1951, our agricultural exports have been falling off. Any
time there is a falling off in our exports of agricultural commodities,
there follows lower prices, increased surplus problems, and there may
follow acreage restrictions and marketing controls. In many cases,
cropland is diverted from production for export to production of other
commodities for domestic consumption. This means that even those
agricultural commodities that are not exported can be directly affected
as a result of a reduction in exports.
One of the most important answers to the problem of our agricul-
tural surpluses is an expanded foreign market. Under the trade-
agreements program, concessions have been obtained for almost every
agricultural product customarily exported from the United States in
any significant amounts. It is the committee's belief that enactment
of this bill will further expand the foreign markets for agricultural
products, which expansion is urgently needed. by American farmers,
and it is our hope that the authority granted the President under this
bill will be utilized insofar as practicable to accomplish this result.
C. Labor
It was stated by Secretary of Labor Mitchell that some 4% million
jobs are attributable to work generated by our foreign trade -both
export and import.
On the other hand, it has been estimated that not over 100,000
workers might be threatened, directly or indirectly, with the loss of
their jobs by increased imports resulting from a hypothetical reduction
across the board of 50 percent in present tariff rates. Although your
committee does not necessarily accept this figure, it does give some
approximate indication of what we believe to be the relative stake
that American workers have in our total world trade as compared to
possible adverse effects from the maximum of imports that could
conceivably be expected within the next few years.
Moreover, If. R. 1 contains safeguards designed to guard against
any sharp increase in imports by requiring that the reductions
authorized can only be put into effect gradually.
The results of the program, therefore, will be to avoid a sudden
influx of imports that would cause unemployment. The result, we
believe, will be it gradually expanding level of trade and employment
in the United States.
It has been contended that since foreign industries have lower wage
and other standards it is difficult or impossible for American industry
to compete with imports in the American market. It is well estab-
lished that many of the United States industries that compete most
successfully, both domestically and in foreign markets, are industries
in which wages paid are among the highest in the United States.
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10 TRADE AGREEMENTS EXTENSION ACT OF 1955
American industry can pay high wages because of its high produc-
tivity. Indreased American productivity makes it possible for
United States industry to pay higher wages.
The important factor is not the wage per hour but the wage per
unit of production. American workers with our mechanized means
of production and highly developed technology, are able to produce
a greater number of products per hour, thus resulting in lower cost
per unit even though their wages per hour are higher.
Th.e administration has taken steps to adopt the policy recom-
mended by the Commission on Foreign Economic Policy that no
tariff concessions should be granted on products made by workers
receiving wages that are substandard in the exporting country.
During the period that the trade-agreements program has been in
effect the people of the United States have achieved the greatest pros-
perity this country has ever known. Wages and working conditions
of our workers have steadily improved during this period despite in-
creased imports.
Jr. the light of this practical test the committee believes that, as a
general principle, the contention that lower tariff barriers would
depress labor standards and wages in the United States has not been
proved.
Testimony of the major labor organizations in support of the bill
is highlighted in appendix B.
D. Commerce and industry
The economic strength and vitality of our American commerce and
industry depend in large measure on our success in fostering expanded
trade with the countries of the free world. For that reason these
important segments of our domestic economy have a vital interest
in the development of United States foreign economic policy as set
forth. in H. R. 1.
In 1953, our gross national product was at an alltime high of
$365 billion. Our exports of goods and services including military aid
amounted to approximately $21 billion and represented almost 6
percent of our total production of goods and services. This export
relatioriship to gross national product compares favorably with: (1)
Gross receipts from farming in 1953 which were equal to about 8.5
percent of gross national product; (2) business expenditures for capital
equipment which represented a little over 6.5 percent of gross national
product; and (3) consumer purchases of durable goods which were a
little over 8 percent of that product. The share of commerce and
industry in our total export business in 1953 (exlusive of military aid)
was $14.25 billion in services and merchandise manufactures. Agri-
cultural exports were $2.75 billion and military aid was $4.5 billion.
In dollar terms our foreign trade amounted to $37 billion in 1953-
$16 billion in imports and $21 billion in exports. Imports and exports
taken together sustained approximately 4% million American jobs.
Our reliance on foreign markets has grown with the increase in
American productivity. Each year the average factory worker in the
United States produces an average of 3 to 5 percent more than he did
the previous year. Our industry sells 10 percent or more of its
trucks, locomotives, machine tools, tractors, and penicillin abroad.
An American tractor manufacturer testifying in support of H. R. 1
before your committee said that without its export business his com-
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TRADE AGREEMENTS EXTENSION ACT OF 1955
pany would not need one-third of the people he employed in the
United States. He also testified that the domestic consumer is able
to buy his tractor at a lower price because export business had per-
mitted greater mass economies than would have been possible in the
absence of the export volume.
In the 20 years since the reciprocal trade program was initiated, our
trade has increased substantially. In 1934 our exports constituted 12
percent of total world trade. At that time as supplier of world
markets we were closely matched by the United Kingdom and Ger-
many. In 1954 our exports constituted 20 percent of total world
trade and our exports were nearly twice as large as those of the second
largest trading country, the United Kingdom.
H. R. 1 will continue the trade-agreements legislation for the same
reason it was started in the first place-as an important export-
promotion measure. Merchandise exports in the mid-thirties stood
at 3.1 percent of a gross national product of $65 billion as compared
with merchandise imports of 2.6 percent. Comparable figures for
1953 indicate a gross national product of $365 billion with mer-
chandise exports of 4.3 percent and merchandise imports of 3 percent.
There can be little question that our increase in exports has con-
tributed substantially to our domestic high employment and_ pros-
perity. The relationship of exports of movable goods to United
States production and of United States exports and imports to gross
national product are shown in the following tables for selected years.
TABLE 1.-United States production of movable goods and the proportion exported:
1929, 1933, 1937, 1939, and 1947-53
J Value in millions of dollars]
Exports,
Year
Agricul-
tural
Manufac-
e
Minin a
g
Freight
y
Total
United
States
Exports as
percent of
products
tures
receipts
merehan-
total
disc
1929______________
13,003
30, 591
4,908
5,100
53,602
5, 157
9.6
1933--------------
6,332
14,008
2,050
3,100
25,490
1,647
6.5
1937______________
10,213
25,174
4,265
4,300
43,952
3,299
7.5
1939______________
9,043
24,487
3,808
4,200
41,538
3,123
7.5
1947______________
32,372
74,426
9,610
9,200
125,608
15,160
12.1
1048______________
32,842
82,000
12,273
10,800
137,915
12,532
9.1
1949______________
30,133
75,367
10,580
10,000
126,080
11,936
9.5
1950______________
30,335
89, 750
11,855
11,600
143,540
10, 142
7.1
1951______________
35, 042
102,086
13, 524
12, 900
163, 552
14, 879
9.1
1952______________
34,517
108,477
13,430
13,300
169,724
15,039
8.9
1953______________
33,056
117, 500
.14, 346
14, 200
179, 102
15, 626
8.7
I Cash receipts from crops and livestock and products, and value of home consumption as reported by
Department of Agriculture.
2 Value added by manufacture; data as reported in the Census of Manufactures through 1947; estimates
for later years.
8 Value of crude or prepared minerals at the mine, well, or plant; Bureau of Mines data.
4 Estimate of cost of moving goods from place of production to points of distribution or exportation; based
on freight revenue of steam railroads, of intercity motor carriers of property, and of pipelines as reported by
the Interstate Commerce Commission.
I Total of items shown representing a rough estimate of the value of production of movable goods at point
of distribution or export. Figures are not adjusted for price changes.
Shipments to foreign countries as recorded by the Bureau of the Census. In recent ye&rs the data
include, besides commercial goods, foodstuffs, said other supplies sent to civilian populations through the
U. S. Armed Forces stationed abroad, shipments under the ECA (Economic Cooperation Administration)
and Mutual Security Program, aril other aid and relief shipments whether financed by Government or by
private agencies. Shipments to U. S. Armed Forces abroad for their own use are excluded from export
statistics.
Source: Foreign Commerce Weekly, Juno 28, 1954.
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12 TRADE AGREEMENTS EXTENSION ACT OF 1955
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Year
Gross
national
product ~
Exports 2
Exports as
percent of
GNP
Imports 2
Imports as
percent of
GNP
Excess of
exports
over
Imports
Exhort
surplus as
percent of
GNP
1929______________
103,828
5,347
5.1
4,463
4.3
884
0.9
1933______________
55,760
1,736
3.1
1,510
2.7
226
.4
1937______________
90,213
3,451
3.8
3,181
3.5
27D
.3
1939______________
91,339
3.347
3.7
2,409
2.6
933
1.0
1947______________
233,264
15,977
6.8
6.129
2.6
9,843
4.2
1948______________
259,045
13,346
5.2
7,822
3.0
5,524
2.1
1949____________
258,229
12,337
4.8
7,066
2.7
5,271
2.0
1950______________
286,826
10,658
3.7
9.315
3.2
1,34.3
.5
1951______________
329,822
15,485
4.7
11,668
3.5
3,817
1.2
1952______________
347.956
15,806
4.5
11,503
3.3
4. 30.3
1.2
1953______________
367,247
16,437
4.5
11,904
3.2
4,53.3
1.2
TABLE 2.-United States merchandise exports and imports and export surplus in.
relation to gross national product: 19:9, 1933, 1937, 1939, and 19.J7-53
[Value in millions of dollars]
I Department of Commerce estimates.
s Merchandise trade as recorded in balance-of-payments statistics, representing all transfers of ownership
of movable goods between the United States and foreign countries.
Source: Foreign Commerce Weekly, June 28, 1954.
Your committee has given careful consideration to the fact that
some domestic industries stated that they have serious problems relat-
ing to their continued survival. Many of these industries appeared
before the committee and attributed their troubles to inadequate
tariff protection. However, careful examination of the facts has
demonstrated that, in many cases, their ills appear to be attributable
to causes other than tariff policy, such as technological progress and
changes in consumer preferences.
R. R. 1 does not affect the many safeguards contained in existing
law to protect American agriculture, industry, commerce, and labor
such as the peril point, escape clause, and other legislation such as
antidumping laws and countervailing duties.
It is the opinion of your committee that the expectations of agri-
culture, industry, and commerce for productive growth and expanding
markets will be furthered under H. R. 1 with resulting benefits to
labor.
E. Appendixes
At the end of the report there is contained appendixes as noted
below:
Appendix A.--An analysis of some of the major criticisms trade-
agreements program opponents have raised, as follows:
United States tariffs are already the lowest in the world.
The trade-agreements program is not reciprocal.
Defense industries and skills are not adequately protected.
Passage of H. R. 1 should await the outcome of the Japanese
negotiations.
Passage of H. R. 1 should await the outcome of the renegotia-
tion of GATT.
Appendix B.-Testimony and comments of persons supporting
H. R. 1, as follows: Executive departments, business and industry,
agriculture, labor, public interest groups, and press support.
Appendix C.--Accomplishments of the trade-agreements program.
Appendix D.---A description of how a trade agreement is made,
describing the procedures which are followed.
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TRADE AGREEMENTS EXTENSION ACT OF 1955 1
III. TECHNICAL ANALYSIS OF H. R. 1 AS REPORTED
The first section of the bill provides that the bill when enacted
may be cited as the Trade Agreements Extension Act of 1955.
Section 2: This section extends the period during which the President
is authorized to enter into foreign trade agreements for an additional
period, from June 12, 1955 through June 30, 1955.
Section 3: This section amends section 350 of the Tariff Act of
1930, as amended, which contains the basic authority to enter into
and carry out trade agreements.
Subsection (a) of section 350, containing six numbered paragraphs, is
set forth in the bill in its proposed amended form.
Paragraph (1) of subsection (a) sets forth the purpose for which the
President may enter into trade agreements. The text preceding sub-
paragraph (A) repeats existing law.
Subparagraph (A) of paragraph (1) authorizes the President to enter
into foreign trade agreements with foreign governments or instru-
mentalities thereof containing provisions with respect to international
trade, including provisions relating to tariffs, to most-favored-nation
standards and other standards of nondiscriminatory treatment affect-
ing such trade, to quantitative import and export restrictions, to?
customs formalities, and to other matters relating to such trade
designed to promote the purpose of section 350 similar to any of the
foregoing.
Subparagraph (A) of paragraph (1), as amended by the committee,.
contains two provisos. The first proviso states that no provision of
any foreign trade agreement shall be given effect in the United States,
in a manner inconsistent with existing legislation of the United States..
The second proviso states that the enactment of this bill shall not be
construed to determine or indicate the approval or disapproval by the
Congress of organizational provisions of any foreign trade agreement
entered into under section 350 of the Tariff Act of 1930.
Subparagraph (B) of paragraph (1), authorizing the carrying out of
trade agreements by proclamation, makes no change in existing law.
The authority to carry out trade agreements by proclamation is no
broader (and no narrower) than under existing law (the terms of
which are identical with the terms of subparagraph (B)).
Paragraph (2) of subsection (a) is divided into subparagraphs (A),.
(B), (C), (D), and (E):
Subparagraph (A) continues unchanged the present prohibition
against increasing any rate of duty to a rate more than 50 percent.
above the rate existing on January 1, 1945.
Subparagraph (B) continues unchanged the present prohibition:
against imposing a duty on a duty-free article or exempting from
duty a dutiable article.
Subparagraph (C) continues unchanged (with respect to trade-
agreements entered into before June 12, 1955) the present prohibition.
against decreasing any rate of duty to a rate lower than 50 percent
below the rate existing on January 1, 1945.
Subparagraph (D) fixes maximum limits on decreases in rates which.
may be made to carry out trade agreements entered into on or after
June 12, 1955. A rate of duty may be reduced under three alter-
native methods which are set out in clauses (i), (ii), and (iii). These
alternatives are not cumulative but the President may decrease a..
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14 TRADE AGREEMENTS EIXTENSION ACT OF 1955
rate to the lowest of the rates resulting from application of any of the
alternative methods.
Clause (i) authorizes decreases in any rate to 15 percent below the
rate existing on July 1, 1955 (that is, to a rate which is 85 percent
of the rate existing on July 1, 1955).
Clause (ii) authorizes decreases in any rate to 50 percent; of the rate
existing on January 1, 1945, on products which are normally not
imported into the United States or which are normally imported in
negligible quantities.
Under the first sentence of this clause, as amended by the commit-
tee, the President, in applying the negligible quantities test, will take
into account the competitive impact on the domestic market of the
amount of the article normally imported into the United States.
The second sentence of this clause (ii), as amended by the committee,
requires identification of articles included in any list furnished to the
Tariff Commission for "peril point" determination pursuant to section
3 (a) of the Trade Agreements Extension Act of 1951, as to which
reduction is authorized by this clause. The committee intends that,
insofar as practicable, articles for which a reduction in duties :is author-
ized by clause (iii) will be similarly identified.
Clause (iii) authorizes decreases in rates of duty which are higher
than 50 percent ad valorem (or equivalent) to 50 percent ad valorem
(or equivalent). In the case of articles subject in whole or in part
to a specific rate of duty (i. e., 5 cents per pound, or 5 cents per
pound plus 20 percent ad valorem), the determination of whether a
rate of duty is higher than 50 percent ad valorem, and the determina-
tion of a rate equivalent to the 50 percent ad valorem rate to which
it may be reduced, will be made by the President on the basis of the
value of imports of such products during a period which lie finds is
representative.
In making such determination, the President is to be guided, to the
maximum extent practicable, by the standards of valuation for
customs purposes contained in section 402 of the Tariff Act of 1930, as
the provisions of that section exist during the representative period.
The reference to the standards of valuation contained in section 402 of
the Tariff Act of 1930 is to make it clear that no action may be taken
under the second sentence of this clause which would result in any
change in existing rules for determining the basis on which any ad
valorem rate of duty is to be assessed. For example, if a rate of 50
percent ad valorem is established pursuant to such second sentence
with respect to an article subject to a rate of duty any part of which
may be based on American selling price (as defined in sec. 402 (g) of
the Tariff Act of 1930), the new rate would be subject to application
on the basis of American selling price in the same manner as, the ad
valorem rate is applied under existing law.
Subparagraph (E) deals with the special situation involving Japan.
This subparagraph provides that in connection with a trade agreement
involving Japan, which is entered into on or after June 12, 1955,
duties may be decreased to as low as 50 percent below the rate exist-
ing on January 1, 1945, if the President determines such decreases are
necessary to provide expanding export markets for Japanese products.
Under existing law the President is authorized to make such reduc-
tions only to carry out trade agreements entered into prior to June 12,
1955. The authority under this subparagraph may be used only in
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TRADE AGREEMENTS EXTENSION ACT OF
connection with negotiations involving Japan, a notice of which was
published in the Federal Register on November 16, 1954.
When read together with the definition of "existing" contained in
section 350 (c) (2) (C) (as added by the bill), the results under subpara-
graph (D) (i) and subparagraph (E) of paragraph (2) are as follows: If
the trade agreement involving Japan is entered into before July 1, 1955
(whether or not before June 12, 1955), the President will have author-
ity (1) in carrying out that agreement, to reduce the rates on products
included therein to 50 percent of the rates existing on January 1, 1945,
and (2) in connection with other trade agreements entered into on or
after June 12, 1955, to reduce by an additional 15 percent (in accord-
ance with the alternative specified in clause (i) above) the rates for
such products agreed to in such agreement involving Japan. If the
trade agreement involving Japan is entered into on or after July 1,
1955, the authority to decrease a rate to 50 percent below the rate
existing on January 1, 1945, will continue; but to the extent that this
authority is exercised with respect to any rate, the authority under the
clause (i) alternative (to decrease that rate by 15 percent of the rate
existing on July 1, 1955) will be correspondingly reduced or eliminated.
For example, assume that in the case of article "X" (on which the
January 1, 1945, rate of duty was 50 percent ad valorem and the July
1, 1955, rate of duty is 40 percent ad valorem) the negotiated rate
under the Japan agreement is 35 percent. Since the reduction under
the Japan agreement would be equal to, 12'/ percent of the rate
existing on July 1, 1955, subsequent agreements could provide for an
additional 2l percent decrease of the July 1, 1955, rate (that is, a
decrease to 34 percent ad valorem).
Paragraph (3) of subsection (a), divided into subparagraphs (A), (B),
(C), and (D), establishes, among other things, procedures for giving
effect gradually (at intervals of at least a year) to decreases (under the
three alternatives in paragraph (2) (D)) in rates made pursuant to
agreements entered into on or after June 1.2, 1.955.
In connection with the Tariff Commission's determination of "peril
points" where the gradual reductions required by the bill are involved,
the bill contemplates that the Commission will determine the peril
point for an article on the basis of the total permissible reduction
rather than on the basis of the application of the total permissible
reduction on a gradual basis.
Subparagraph (A), except as limited by subparagraphs (B) and
(C) of paragraph (3), continues in substance. the provision of existing
law that the proclaimed duties and other import restrictions shall be
in effect from and after such time as is specified in the proclamation.
Subparagraph. (B) fixes the time limits within which the decreases
in rates authorized by subparagraph (D) of paragraph (2) described
above may be made effective. These time limits are as follows: A
decrease of no more than 5 percent of the rate existing on July 1, 1955,
may become initially effective at one time if the total amount of the
decrease is 15 percent or less. If the total amount of the decrease is
greater than 15 percent, no more than one-third of the decrease may
become initially effective at one time. In the case of any of the three
alternatives, no part of the decrease after the first part can become
initially effective until the immediately previous part has been in effect
for at least 1 year.
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16 TRADE AGREEMENTS EXTENSION ACT OF 1955
Subparagraph (C) provides that (subject to an exception stated in
the second sentence of the subparagraph as explained below;) no
decreases under the first alternative method (the 15-percent decrease
authority) may be made effective after the expiration of the 3-year
period which begins on July 1, 1955 (that is, after June 30, 1958). The
result of this limitation, when applied with the 1-year requirement for
each decrease, is that the full 15-percent decrease under the first al ter-
native cannot be made unless the first 5-percent decrease takes effect
before ,July 1, 1956. Subparagraph (C) does not apply to the second
alternative (the authority to reduce by 50 percent of the January 1,
194.15, rate in case of negligible quantities or no imports), or to the
third alternative (the authority to reduce a rate to 50 percent ad
valorem). The exception to the June 30, 1958, deadline in the case
of the first alternative method (the 15-percent decrease authority)
relates to the situation where, by reason of legislation of the United
States or action thereunder, a decrease which had been made by virtue
of the exercise of that authority and given effect, and which was
thereafter nullified, could be reapplied (and its successive stages, if
any., applied), even though the 3-year period extended beyond June 30,
1958. The following illustrates the application of subparagraph (C)
in a case where the first decrease takes effect before July 1, 1956:
(1) Assume the following: .
(A) The first 5 percent decrease takes effect on April 15,
1956, and remains in effect until the close of November 30,
1956 (a total of 230 days).
(B) On December 1, 1956, the reduced duty is increased
as a consequence of an escape-clause action.
(C) The duty resulting as a consequence of the escape-
clause action remains in effect through May 31, 1957 (a total
of 182 days).
(D) On June 1, 1957, the decreased rate is restored.
(2) Under the facts stated in paragraph (1) above, the 5-percent
decrease will not have been in effect for a total period of 1 year
until the close of October 13, 1957. Thus, if the second decrease
is to become effective it must become effective no"earlier than
October 14, 1957, and no later than December 29, 1958 (182 days
after June 30, 1958). In order to permit the third decrease to
become effective, the second decrease must become effective on
or "before December 29, 1957.
(3) If the second decrease takes effect on October 14, 1957,
and remains in effect for 1 year through October 13, 1958, then
the third decrease could take effect at any time on or after Oc-
tober 14, 1958, and before December 30, 1958.
Subparagraph (D) of this paragraph permits the rounding out of
rates in order to simplify the computation of the amount of duty under
any of the alternative methods of decreases. Under the precise appli-
cation of the limitations specified in the alternative methods (and
particularly under the 3-step application thereof) unusual and
cumbersome fractions might be present in some rates. To avoid
complication of tariff schedules by including such fractions, provision
is made for a narrow tolerance, not to exceed one-half. of 1 percent
ad valorem, for rounding out such fractions to whole numbers or to
fractions such as are customarily used in our tariff schedules. The
purpose of this provision is to contribute to tariff simplification by
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TRADE AGREEMENTS EXTENSION ACT 1
avoiding burden on trade represented by rates stated in complicated
fractions which make computations of duties difficult.
Paragraph (I) of subsection (a) adds to section 350 a requirement
that the President, in exercising his authority under that section, is
to avoid the subdivision of classification categories to the maximum
extent he deems practicable and consistent with the purpose of section
350. This provision was inserted in order that further complication
of the existing tariff structure might be avoided. It does not au-
thorize reclassification of airy article, but refers to the breaking up
of an existing classification into additional subdivisions.
Paragraph (5) of subsection (a), as amended by the committee,
provides that trade-agreement concessions shall apply to imports of
the goods of all countries, except that the President shall, as soon as
practicable, suspend the application of these rates to the products of
countries which discriminate against American commerce or engage
in other conduct tending to defeat the purpose of section 350. As
under existing law, this provision is subject to section 5 of the Trade
Agreements Extension Act of 1951, which requires the President to
withdraw benefits of trade-agreement concessions to imports from
U. S. S. R. and from any nation or area dominated or controlled by
the foreign government or foreign organization controlling the world
Communist movement. By making its amendment, the committee
intends that the President withdraw most-favored-nation treatment
from a country after he has had reasonable time to make efforts to get
that country to cease its discriminatory treatment against American
commerce or to rectify the other acts or policies which in his opinion
tend to defeat the purpose of section 350.
Paragraph (6) of subsection (a) authorizes the President to terminate
at any time, in whole or in part, any proclamation made pursuant to
section 350. This continues a provision of existing law; it has been
moved to this separate paragraph solely for reasons of clarity.
Subsection (b) of section 3 of the bill amends existing law to make
clear the limits of authority to reduce tariffs with respect to products
of Cuba.
Paragraph (1) of this subsection (b) deals with foreign trade agree-
ments, whether with Cuba or any other country, which may be
entered into before June 12, 1955, and continues unchanged the
present authority to decrease duties on.Cuban products to 50 percent
of the rates existing on January 1, 1945, for such products.
Paragraph (2) of this subsection deals with trade agreements which
may be concluded on or after June 12, 1955. Just as the proposed sub-
section (a) (2) (D) of section 350 confers authority to reduce general
rates of duty (applicable to products other than Cuban products) by
the use of 3 alternative methods, this paragraph gives parallel au-
thority (the same 3 alternatives) with respect to the rates applicable
to Cuban products, which in most cases are preferential. Under
the third alternative method, the President could reduce all general
rates which exceed 50 percent ad valorem to 50 percent ad valorem;
in giving parallel authority with respect to products of Cuba, the last
sentence of this paragraph authorizes the President to establish a
rate for Cuban products lower than 50 percent ad valorem if necessary
to maintain the absolute margin of preference to which the products
of Cuba are entitled. Any decreases in the Cuban rates under the
three alternatives must also be spread over a period of at least 3 years.
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18 TRADE AGREEMENTS EXTENSION ACT OF 1955
The reference to subsection (a) (2) (E) in this paragraph would permit
decreasing duties on Cuban products to 50 percent of the rates existing
on January 1, 1945, for such products if the trade agreement involving
Japan its not entered into until on or after June 12, 1955.
Subsection (c) of section 3 makes necessary technical amendments to
subsection (c) of section 350 to conform with -substantive changes in
other parts of the bill. It is made clear that the limitations on in-
creases or decreases in duty relate to rates of duty other than rates
of duty which apply to products only by reason of action taken under
section 5 of Trade Agreements Extension Act of 1951. For a discus-
sion of the new paragraph (2) (C), see the explanation contained in
the paragraph explaining subsection (a) (2) (E).
It was considered unnecessary to include among the definitions
contained in subsection (c) of section 350 a definition of the term
"customs formalities," since that term has a well-established meaning
when used in connection. with reciprocal trade agreements and in
connection with the administration of the customs laws of the United
States. When so used, such term relates only to the character, form,
and number of the papers required and procedural steps to be taken for
clearing articles, carriers, and persons through customs. It does. not
include matters entering into the amounts of duties required to be paid
on particular articles, such as the terms of statutes or proclamations
under which imports are classified to determine their tariff status and
statutory provisions under which values for duty are fixed.
Subsection (d,) of section 3 adds a new subsection (e) to section 350,
requiring the President to submit to Congress annually a report on
the trade-agreements program as recommended by the Commission
on Foreign Economic Policy. The report is to contain, among other
things, information on modifications of trade agreements, including a
report on the incorporation of escape clauses in existing agreements,
and information relating to agreements entered into.
Section 4: This section deletes the requirements now in section
6 (b) of the Trade Agreements Extension Act of 1951 that the Presi-
dent report semiannually regarding action taken to incorporate
escape clauses into existing agreements. Now developments on this
score would be covered by the comprehensive annual report of the
President provided for in the new section 350 (e) described above.
Section 5: The bill as introduced contained a section 5 which would
have authorized the President, without entering into any foreign
trade agreement, to reduce by 50 percent the rate of duty existing
on January 1, 1945, in the case of any product which was not being
imported into the United States or was being imported into the United
States only in negligible quantities. Under the committee amend-
ment, this section is deleted from the bill.
In compliance with clause 3 of rule XIII of the Rules of the House
of Representatives, changes in existing law made by the bill, as
introduced, are shown as follows (existing law proposed to be omitted
is enclosed in black brackets, new matter is printed in italics, existing
law in which no change is proposed is shown in roman) :
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TRADE AGREEMENTS EXTENSION ACT OF 1955
SECTION 350 OF THE TARIFF ACT OF 1930
SEC. 350. (a) (1) For the purpose of expanding foreign markets for the products
of the United States (as a means of assisting in establishing and maintaining a
better relationship among various branches of American agriculture, industry,
mining, and commerce), by regulating the admission of foreign goods into the
United States in accordance with the characteristics and needs of various branches
of American production so that foreign markets will be made available to those
branches of American production which reouire and are capable of developing
such outlets by affording corresponding market opportunities for foreign products
in the United States, the President, whenever he finds as a fact that any existing
duties or other import restrictions of the United States or any foreign country
are unduly burdening and restricting the foreign trade of the United States
and that the purpose above declared will be promoted by the means hereinafter
specified, is authorized from time to time-
[(I) To enter into foreign trade agreements with foreign governments or
instrumentalities thereof; and
[(2) To proclaim such modifications of existing duties and other import
restrictions, or such additional import restrictions, or such continuance, arid
for such minimum periods, of existing customs or excise treatment of any
article covered by foreign trade agreements, as are required or appropriate
to carry out any foreign trade agreement that the President has entered into
hereunder. No proclamation shall be made increasing or decreasing by more
than 50 per centum any rate of duty, however established, existing on January
1, 1945 (even though temporarily suspended by Act of Congress), or trans-
ferring any article between the dutiable and free lists. The proclaimed duties
and other import restrictions shall apply to articles the growth, produce, or
manufacture of all foreign countries, whether imported directly, or indirectly:
Provided, That the President may suspend the application to articles the
growth, produce, or manufacture of any country because of its discriminatory
treatment of American commerce or because of other acts (including the
operations of international cartel,,) or policies which in his opinion tend to
defeat the purposes set forth in this section; and the proclaimed duties and
other import restrictions shall be in effect from and after such time as is
specified in the proclamation. The President may at any time terminate
any such proclamation in whole or in part.)
(A) To enter into foreign trade agreements with foreign governments or
instrumentalities thereof containing provisions with respect to international
trade, including provisions relating to tariffs, to most-favored-nation standards
and other standards of nondiscriminatory treatment affecting such trade, to
quantitative import and export restrictions, to customs formalities, and to other
matters relating to such trade designed to promote the purpose of this section
similar to any of the foregoing: Provided, That, except as authorized by sub-
paragraph (B) of this paragraph, no such provision shall be given effect in the
United States in a manner inconsistent with existing legislation of the United
States.
(B) To proclaim such modifications of existing duties and other import
restrictions, or such additional import restrictions, or such continuance, and for
such minimum periods, of existing customs or excise treatment of any article
covered by foreign trade agreements, as are required or appropriate to carry out
any foreign trade agreement that the President has entered into hereunder.
(2) No proclamation pursuant to paragraph (1) (B) of this subsection shall be
made---
(A) Increasing by more than 50 per centum any rare of duty existing on
January 1, 1915.
(B) Transferring any article between the dutiable and free lists.
(C) In order to carry out a foreign trade agreement entered into by the Presi-
dent before June 12, 1955, decreasing r,y more than 50 per centum any rate of
duty existing on January 1, 1945.
(D) In order to carry out a foreign trade agreement entered into by the Presi-
dent on or after June 12, 1955, decreasing (except as provided in subparagraph
(E) of this paragraph) any rate of duty below the lowest of the following rates:
(i) The rate 16 per centum below the rate existing on July 1, 1955.
(ii) In the case of any article which the President determines, at the time
the foreign trade agreement is entered into, is not being imported into the.
United States or is being imported into the United States in negligible
quantities, the rate 50 per centum below the rate existing on January 1,
1945.
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20 TRADE AGREEMENTS EXTENSION ACT OF 1955
(iii) In the case of any article subject to an ad valorem rate of duty above
50 per centum (or a combination of ad valorem rates aggregating more than
50 per centum), the rate 50 per centum ad valorem (or a combination of ad
valorem rates aggregating 50 per centum). In the case of any article sub-
ject to a specific rate of duty (or a combination of rates including a specific
rate) the ad valorem equivalent of which has been determined by the Presi-
dent to have been above 50 per centum during a period determined by the
President to be a representative period, the rate 50 per centurn ad valorem
or the rate (or a combination of rates), however stated, the ad valorem equiva-
lent of which the President determines would have been 50 per centum during
such period. The standards of valuation contained in section 402 of this
Act (as in effect during the representative period) shall be utilized by the
President, to the maximum extent he finds such utilization practicable, in
making the determinations under the preceding sentence.
(F) In order to carry out a foreign trade agreement entered into by the President
on or after June 12, 1953, to which the Government of Japan is a party and
with respect to which notice of intention to negotiate was published an November
16, 1954 (19 F. R. 7379), if the President determines that such decrease is
necessary in order to provide expanding export markets for products of Japan
(including ss,,ch markets in third countries), decreasing by more than 50 per
centum any rate of duty existing on January 1, 1945.
(3) (A) Subject to the provisions of subparagraphs (B) and (C) of this paragraph,
the provisions of any proclamation made under paragraph (1) (B) of this subsection,
and the provisions of any proclamation of suspension under paragraph (5) of this
subsection, shall be in effect from and after such time as is specified in the proclamation.
(B) In the case of any decrease in duty to which paragraph (2) (D) of this subsection
applies--
(t) if the total amount of the decrease under the foreign trade agreement does
not exceed 15 per centum of the rate existing on July 1, 1955, the amount of
decrease becoming initially effective at one time shall not exceed 5 per centum of
the rate existing on July 1, 1955:
(ii) except as provided in clause (i), not more than one-third of the total
amount of the decrease under the foreign trade agreement shall become initially
effective at one time; and
(iii) no part of the decrease after the first part shall become initially effective
until the immediately previous part shall have been in effect for a period or periods
aggregating not less than one year.
((') No part of any decrease in duty to which the alternative specified in paragraph
(2) (D) (i) of this subsection applies shall become initially effective after tie expiration
of the three-year period which begins on July 1, 1955. If any part of such decrease
has become effective, then for purposes of this subparagraph any time thereafter during
which such part of the decrease is not in effect by reason of legislation of the United
States or action thereunder shall be excluded in determining when the three-year
period expires.
(D) If the President determines that such action will simplify the computation of
the amount of duty imposed with respect to an article, he may exceed any limitation
specified in paragraph (2) (D) or (I:) of this subsection or subparagraph (B) of this
paragraph by not more than whichever of the following is lesser:
(i) The difference between the limitation and the next lower whole number, or
(ii) One-half of 1 per centum ad valorem.
In the case of a specific rate (or of a combination of rates which includes a specific
rate), the one-half of 1 per centum specified in clause (ii) of the preceding sentence
shall, be determined in the same manner as the ad valorem effect of rates not stated
wholly in ad valorem terms is determined for the purposes of paragraph (2) (D) (iii)
of this subsection.
(4.) In exercising his authority under this section, the President shall avoid, to the
maximum extent he deems practicable and consistent with the purpose of this section,
the subdivision of classification categories.
(f) Subject to the provisions of section 5 of the Trade Agreements Extension Act
of 1951 (19 U. S. C., sec. 1362), duties and other import restrictions proclaimed
pursuant to this section shall apply to articles the growth, produce, or manufacture of
all foreign countries, whether imported directly or indirectly: Provided, That the
President may suspend the application to articles the growth, produce, or manufac-
ture of any country because of its discriminatory treatment of American commerce
or because of other acts (including the operations of international cartels) or policies
which in his opinion tend to defeat the purpose of this section.
(6) The President may at any time terminate, in whole or in part, any proclamation
made pursuant to this section.
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(b) Nothing in this section shall be construed to prevent the application, with
respect to rates of duty established under this section pursuant to agreements
with countries other than Cuba, of the provisions of the treaty of commercial
reciprocity concluded between the United States and the Republic of Cuba on
December 11, 1902, or to preclude giving effect to an exclusive agreement with
Cuba concluded under this section, modifying the existing preferential customs
treatment of any article the growth, produce, or manufacture of Cuba. Nothing
in this Act shall be construed to preclude the application to any product
(including products preferentially free of duty) of a rate of duty not higher than
the rate applicable to the like products of other foreign countries (except the
Philippines), whether or not the application of such rate involves any preferential
customs treatment. No rate of duty on products of Cuba [shall in any case be
decreased by more than 50 per centum of the rate of duty, however established,
existing on January 1, 1945 (even though temporarily suspended by Act of Con-
gress)] shall be decreased--
(1) In order to carry out a foreign trade agreement entered into by the President
before June 12, 1955, by more than 50 per centum of the rate of duty existing on
January 1, 1945, with respect to products of Cuba.
(2) In order to carry out a foreign trade agreement entered into by the President
on or after June 12, 1955, below the applicable alternative specified in subsection
subject to the provisions of subsection (a) (3) (B), ( )>
(a) (2) (D) or (E)( p. C and
(D)), each such alternative to be read for the purposes of this paragraph as relating
to the rate of duty applicable to products of Cuba. Witrespect
exceeded du cts of
Cuba, the limitation of subsection (a) (2) (D) (iii) may such
extent as may be required to maintain an absolute margin of preference to which
such products are entitled.
(c) (1) As used in this section, the term "duties and other import restrictions"
includes [(1)] (A) rate and form of import duties and classification of articles,
and [(2)] (B) limitations, prohibitions, charges, and exactions other than duties,
imposed on importation or imposed for the regulation of imports.
(2) For purposes of this so this
Except as provided in subsection. (d) and subparagraph (C) of
paragraph, the terms "existing on January 1, 1945" and "existing on July 1,
1955" refer to rates of duty (however established, and even though temporarily
suspended by Act of Congress or otherwise) existing on the date specified, except
rates in effect by reason of action taken pursuant to section 5 of the Trade Agree-
ments Extension Act of 1951 (19 U. S. C., sec. 1362).
(B) The term "existing" without the specification of any date, when used with
respect to any matter relating to the conclusion of, or proclamation to carry out, a
foreign trade agreement, means existing on the day on which that trade agreement
is entered into.
(C) In applying paragraphs (2) (D) (i) and (3) (B) (i) of subsection (a), the
rate of duty on an article included in a foreign trade agreement with respect to
which notice of intention was published on November 16, 1954 (19 F. R. 7379), if
such agreement is entered into before July 1, 1955, shall be considered to be the
rate "existing on July 1, 1955".
(d) (1) When any rate of duty has been increased or decreased for the duration
of war or an emergency, by agreement or otherwise, any further increase or de-
crease shall be computed upon the basis of the post-war or post-emergency rate
carried in such agreement or otherwise.
(2) Where under a foreign trade agreement the United States has reserved the
unqualified right to withdraw or modifv, after the termination of war or an emer-
gency, a rate on a specific commodity, the rate on such commodity to be considered
as "existing on January 1, 1945" for the purpose of this section shall be the rate
which would have existed if the agreement had not been entered into.
(3) No proclamation shall he made pursuant to this section for the purpose of
carrying out any foreign trade agreement the proclamation with respect to which
has been terminated in whole by the President prior to the date this subsection is
enacted.
(e) The President shall submit to the Congress an annual report on the operation
of the trade agreements program, including information regarding new negotiations,
modifications made in duties and import restrictions of the United States, reciprocal
concessions obtained, modifications of existing trade agreements in order to effectuate
more fully the purposes of the trade agreements legislation (including the incorpora-
tion therein of escape clauses), and other information relating to that program and to
the agreements entered into thereunder.
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22 TRADE AGREEMENTS EXTENSION ACT OF 19 515
SECTION 6 OF THE TRADE AGR1 EMENTS EXTENSION ACT OF 1951
SEC. 6. (a) No reduction in any rate of duty, or binding of any existing customs
or excise treatment, or other concession hereafter proclaimed under section 350
of the Tariff Act of 1930, as amended, shall be permitted to continue in effect
when the product on which the concession has been granted is, as a result, in
whole or in part, of the duty or other customs treatment reflecting such concession,
being imported into the United States in such increased quantities, either actual
or relative, as to cause or threaten serious injury to the domestic industry pro-
ducing like or directly competitive products.
('b) The President, as soon as practicable, shall take such action as may be
necessary to bring trade agreements heretofore entered into under section 350
of the Tariff Act of 1930, as amended, into conformity with the policy established
in subsection (a) of this section.
[On or before January 10, 1952, and every six months thereafter, the President
shall report to the Congress on the action taken by him under this subsection.]
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MINORITY VIEWS
We are opposed to H. R. 1.
There are those who seek to identify the opposition to this legisla-
tion as simply "high tariff." This approach obscures the real issues
presented by the bill, and it ignores the fact that the United States is
already among the very lowest tariff nations of the world.
We do not base our opposition to H. R. 1. on the ground that there
should be a general increase in tariffs. In fact, we recognize that in
selective areas actual reductions in existing tariffs might be appro-
priate.'
On the contrary, we base our opposition on this basic premise;
that any tariff policy of the United. States should at least place foreign
producers, having lower costs, in a comparable competitive position
in the United States market with efficient, domestic producers. Such
a policy should not discriminate in favor of foreign producers and
against United States labor and producers. In addition, it should
give full weight to considerations of national defense and to domestic
health and welfare, and should provide adequate and effective pro-
cedures to accomplish these objectives.
We agree with the statement of President Eisenhower contained
in his first state of the Union message February 2, 1953, when he
declared in connection with his request for extension of the trade-
agreements authority:
This objective must not ignore legitimate safeguarding of domestic industries
agriculture, and labor standards.
We agree with the report of the Commission on Foreign Economic
Policy when it declares that---
American labor should not be subjected to unfair competition as a part of any
program to expand our foreign trade.
We cannot agree that I.I. R. 1 contains such provisions and safe-
guards .
ANALYSIS OF H. R. 1
1. Summary of rate reductions authorized.--As reported by the
committee, H. R. 1 authorizes the following decreases in rates of duty:
(a) Fifteen percent below the July 1, 1955, rate with respect to
all rates of duty;
(b) Fifty percent below the January 1, 1945, rate on articles
normally nnported in negligible quantities;
(c) Down to 50 percent ad valorem where rates tire above
that percentage; and
(d) As for Japan, 50 percent below the January 1, 1945, rate
if the trade agreement is entered into between June 12, 1955,
and July 1, 1955, to be followed by the additional 15-percent
reduction below the new July 1, 1955, rate.
In this connection, two of the undersigned, Mr. Reed and Mr. Mason, have introduced bills, Ti. R.
3609 and H. R. 3604, respectively, to suspend the tariff on imports of aluminum, and Mr. Reed has intro-
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24 TRADE AGREEMENTS EXTENSION ACT OF 1955
The authority to make such rate reductions expires on July 1, 1958,
and there is no provision that these reductions shall be noncumulative.
In all its hearings, the committee obtained no facts as to the likely
effect of the proposed tariff reductions upon our imports or exports.
There was no evidence as to the articles which will be affected by the
proposed reductions nor as to the reason why "5 percent per year" is
of singular validity as distinguished from other percentages. Like-
wise, there was no information available to the committee as to why
"50 percent," as distinguished from some other percentage, is, the
proper amount to which rates in excess of that figure should be re-
duced. Nor were we told what items are imported in "negligible"
quantities or the justification for an arbitrary reduction in the rates
of duty on such commodities by 50 percent.
While the report of the Commission on Foreign Economic Policy
as well as the President's message to the Congress emphasizes that
tariff :reductions must be applied selectively, H. R. 1 is significantly
silent on this point.
2. Broader powers conferred by R. R. 1. -The present-basic authority
granted the President is "to enter into foreign trade agreements with
foreign governments or instrumentalities thereof;". The bilateral
agreements from 1934 to 1943 and the multilateral agreements from
1947 to date were entered into under this authority. H. R. 1 provides
a broader statement of this authority.
The language which H. R. 1 adds to the basic grant of powers to
the President is descriptive of the subjects covered in the commercial
policy section (as contrasted with the organizational provisions) of
GATT, an international agreement described below. Under H. R. 1,
the President would be authorized. (italicized words are new language)-
To enter into foreign trade agreements with foreign governments or instrumentali-
ties thereof containing provisions with respect to international trade, including
provisions relating to tariffs, to most-favored-nation standards and other standards
of nondiscriminatory treatment affecting such trade, to quantitative import and
export restrictions, to customs formalities, and to other matters relating to such. trade
designed to promote the purpose of this section similar to any of the foregoing: Pro-
vided, That no such provision shall be given effect in the United States in am,anner
inconsistent with existing legislation of the United States.
We have been unable to determine the intended purpose of this new
language. We have been told that it is merely descriptive of the
authority which the State Department already assumes it has and
which it has already exercised. If this is, in fact, the case, we see no
necessity for its inclusion in this legislation. The specific grants of
authority which are now mentioned for the first time, such as "quanti-
tative import and export restrictions" and "customs formalities" are
themselves so vague as to furnish no clear guide as to what is meant.
However, the grant also extends to "such other matters relating to
such trade designed to promote the purpose of this section similar to
any of the foregoing." No one knows to what this refers. Is it
intended to constitute authorization or approval for the substantive
provisions of GATT? Absolutely no need for this new language has
been demonstrated. It should be eliminated as unnecessary.
In addition, for the first time H. R. 1 would explicitly authorize the
President to commit the United States in a trade agreement with one
country to grant concessions to unnamed third countries. This
unique provision is designed to implement the declared. purpose of the
negotiations with Japan (sec. 3 (a) (2) (E) of the bill)-namely, to
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TRADE AGREEMENTS EXTENSION ACT OF 9
provide expanding export markets for that country's products, in-
cluding such markets in third countries. This is in contrast to the
Trade Agreements Act's stated purpose of "expanding foreign markets
for products of the United States." It, thus, eliminates the concept
of reciprocity which underlies all previous delegations of tariff au-
thority.
3. Relation to GATT.-GATT is an abbreviation for the General
Agreement on Tariffs and Trade, an international agreement to which
the United States is a party.
The contracting parties to GATT bind themselves with respect
to tariff rates, quotas, countervailing duties, etc. Presumably, the
United States does not, as a member of GATT, bind itself in con-
travention of existing legislation by the. Congress. But in areas in
which Congress has not acted; an agreement within GATT (for ex-
ample as to agricultural import quotas) would in practice preclude
future congressional action in the same area if such action would be
in violation of the GATT agreement.
GATT has never been submitted to the Congress for approval.
We are concerned that the sweeping grant of authority discussed
above can be interpreted as constituting such approval. It has been
denied that this is the intention but the new language contained in
the bill would seem to speak for itself, perhaps with especial clarity to
the other members of GATT.
Recent extensions of the trade-agreements authority have con-
tained this provision:
The enactment of this Net shall not be construed to determine or indicate
the approval or disapproval by the Congress of the Executive agreement known
as the General Agreement on Tariffs and Trade
An identical amendment to H. R. 1 was offered in the committee.
and rejected by the majority. We are at a loss to understand that
rejection. An amendment was adopted to H. R. 1 to provide that
its enactment will not constitute approval or disapproval of the
organizational provisions of any trade agreement. We raise the
question of whether this amendment does not by inference clearly
imply, approval of the substantive provisions of GATT.
4. Ultimate uncertainty of rate reductions.-Both the report of the
Commission on Foreign Economic Policy and the message of the
President to the Congress on January 10, 1955, recommended the
grant of authority to reduce "existing" tariffs by 15 percent. It
might be supposed that this recommendation referred to a reduction
in tariff rates now in effect. If that were so, the Congress would
have a clear guide at least to how much of a reduction authority it was
delegating in H. R. 1. However, that is not the case.
H. R. 1 provides that the 15-percent reduction shall be made with
respect to the rates "existing on July 1, 1955." Why is this signifi-
cant? It is significant and vitally important because negotiations
are about to commence with Japan and subsequent negotiations with
many GATT parties in Geneva. Any tariff concessions granted to
Japan will be extended automatically under the most-favored-nation
principle to all countries of the world (outside the Communist bloc).
If these concessions are granted prior to July 1, 1.955, the new rates
will form the basis for the additional 15-percent reduction. As a
result, neither Government witnesses before the committee nor the
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26 TRADE AGREEMENTS EXTENSION ACT OF 1955
Tariff Commission have been able to give any estimate of what the
ultimate level under the reductions authorized by H. R. 1 will be.
5. Uncertainties in authority to reduce tariffs on articles imported in
negligible quantities.-Under H. R. 1, a rate on an article which the
President determines is not "normally" imported, or is "normally"
imported in "negligible quantities," may be cut 50 percent below- the
January 1, ,1945 rate. The bill contains no definition of the term
"negligible." 'There is no specification as to the group, class or industry,
not, any reference as to what commodities or articles might be affected
by this authority. Nor is there any definition as to the measure of
time or circumstances bearing upon the imports which should be used.
Certainly the use of the word "normally" is no real aid to definition.
Not only does H. R. 1 contain no definition of what is meant by this
provision but no satisfactory explanation was furnished the commit-
tee of how it is intended to administer the provision. This type of
delegation without ascertainable standards represents an abdication of
constitutional responsibility.
We recognize that the economic well-being of the non-Communist
countries is of vital importance to the security of the free world.
Economic strength is inseparable from military strength. We recog-
nize, moreover, that foreign trade is of far greater significance in the
economies of most foreign nations than it is to our own.
However, in achieving the goal of economic strength for our friends
abroad, we do not believe it necessary to sacrifice either particular
industries or particular skills in the United States. To do so, would
only serve to defeat the very objective we seek. A sound, stable, and
prosperous economy in the United States is the most vital single factor
for a sound world economy. This is because of the tremendous rate
of consumption of world products arising from the high standards
of living prevailing in the United States. Moreover, a solid United
States defense structure, founded upon a strong industrial base, is a
prime requisite for peace and security in the world.
No evidence has been produced which would demonstrate the need
for economic sacrifice by selected segments of the American people at
this time. Even proponents of H. R. 1 will agree that injury to
individual domestic industries including their workers, their workers'
families, and the communities in which they live, either will or may
occur from a further lowering of our tariffs. The facts simply do not
justify such a risk.
The Commission on Foreign Economic Policy said that "by any
test that can be devised the United States is no longer among the
higher tariff countries of the world." Sin-.e passage of the original
recipro,sal trade agreements legislation in 1934, average tariff rates of
the United States have been reduced by 70 percent. Already, the
United States stands seventh from the bottom of a list of 45 nations
with respect to the average level of their tariff structure. Certainly,
it cannot be said that the United States has not done its fair share
already in reducing trade barriers. Imports into the United States
from abroad are at the rate of almost $11 billion annually, the highest
in history. The economies of oar friends abroad are booming.
Official reports in Great Britain show that, in 1954, it had its best year
in history and anticipates a better year in 1955. In fact, there is
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some concern, expressed by official British agencies, that power and
other facilities in Great Britain may not be adequate to meet the
requirements of its expanding economy. Western Germany's eco-
nomic recovery has far exceeded anticipations and, in fact, in some
areas, is surpassing prewar production of both East and West Ger-
many combined. Other European countries show similar improve-
ment. In almost all Western European countries, gold and dollar
reserves are at an alltime high.
Even employment is reaching high levels abroad. Despite an influx
of refugees and an increase of 13 percent in Germany's labor force,
unemployment in that country averaged only 6.2 percent in 1954.
A recent report of the Organization for European Economic Coop-
eration states that unemployment in Germany was down to 3.5 per-
cent at the 1954 summer low point. England has no unemployment.
Recent advices state that 340,000 jobs are available and unfilled in
that country---90,000 more jobs available than the number of unem-
ployed. In contrast, there are 3,730,000 unemployed in the United
States--5 percent of our work force and double the percentage of a
year ago, despite a multi-billion-dollar defense program.
We have not had sufficient experience with normal operation of
our recent tariff policy either to evaluate that policy as it is today
or to determine what our tariff should be in the future. We simply
do not have the facts. As was stated by the report of the Commission
on Foreign Economic Policy:
The world, including the United States, has had no experience for any consider-
able period of time with our present tariffs under conditions which might be
termed relatively normal. The Trade Agreements Act was enacted while we were
in the middle of a depression. Many bilateral trade agreements, involving many
reductions in our duties, were made during the first 5 years the act was in effect,
but there had been limited opportunity to observe their effect before our trade,
already distorted, was further disrupted by the outbreak of war.
Since the termination of World War II the patterns of both our .exports and
our imports have been abnormal. There was an unusually large demand for our
exports, both for consumption and for rebuilding a war-torn world, and an inter-
ruption in the growth of our imports, arising out of the same causes. The Korean
war resulted in a further distortion. Resulting imbalances were financed largely
through our foreign loan and grant programs. During this period, we continued
to make further agreements involving still greater reductions in our tariffs.
Now, we find ourselves facing demands for further opening of our markets at
a time when our commercial exports are in approximate balance with the highest
level of imports ever reached, while the world as a whole has considerably rebuilt
its holdings of gold and dollar reserves.
Today, imports have begun to flow into the United States in
sufficient quantities to cause injury in specific areas of the domestic
economy. However, the extent of those imports constitutes no
measure whatsoever of the competitive potential which we face in the
future. The industrial machines of England, Germany, Belgium,
France, Italy, and Japan have only recently been reconstructed and
expanded. Other parts of the world, such as India, are becoming
rapidly industrialized for the first time. None of these countries has
as yet reached nearly full capacity. The United States, with its high
wages and mass purchasing power, is the greatest market in the world.
Sharing in this market is the logical goal of every expanding producer
in the world.
We have seriously questioned in the past the efficacy of existing
procedures for safeguarding domestic industry and workers from
injury. The significance of this inadequacy becomes far greater
today in view of the resurgence of foreign industry.
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28 TRADE AGREEMENTS EXTENSION ACT OF 1955
The peril-point and the escape-clause provisions of the present law
were intended by the Congress to provide the mechanism whereby
domestic industries and workers would be protected from serious
injury resulting from imports. Neither provision has achieved this
objective in the past and nothing in H. R. 1 corrects this deficiency.
The "`peril point" provides that before any reduction in a tariff rate
on it specific product can be made, the President must obtain the
advice of the Tariff Commission as to the rate below which it believes
a reduction could not be made without causing or threatening serious
injury be "dorrmestic industry" producing the product. No relief has,
as yet, been provided under this provision.
In the event that tariff concessions result in such increased imports
as to cause or threaten serious injury to the domestic industry;, the
concession may be withdrawn or modified in accordance with a pro-
vision, known as the "escape clause," which must be incorporated in
every agreement. Upon petition any interested party may request
the United States Tariff Commission to make an investigation and
report to the President whether or not a concession has been the cause
of serious injury or the threat theroof.
Since institution of the escape-clause procedure in 1948, there have
been 59 applications for relief to the Tariff Commission. In 15 of
these cases, the Commission found injury or the threat of injury and
so reported to the President. In only five of these cases has the
President taken action in response to the report. of the Commission.
These were:
Women's :fur felt hats and hat bodies (October 30, 1950)
Hatters' fur (January 5, 1952)
Dried figs (August 16, 1952)
Alsike, cloverseed (June 30, 1954)
Watches, movements, and parts (second investigation) (July 27,
1954)
Among serious criticisms of the present escape, clause procedure is
that.the Tariff Commission ignores the fact of injury to a significant
segment of the affected industry and looks, instead, to the question
of whether or not the industry as it whole is injured. Moreover, the
law does not provide that the Commission consider impairment of the
national defense in its consideration of the effect of imports on domestic
producers.
Escape-clause proceedings before the Tariff Commission are lengthy
and involve exhaustive public hearings. Every available fact is laid
before the Commission. However, in his rejection of escape-clause
recommendations, the President has frequently expressed his disagree-
ment with the finding of the Commission as to the fact of injury.
This disagreement over the facts has been based upon several grounds.
For example, the President may decide that injury has occurred,
not because of imports as found by the Tariff Commission, but as the
result of a nontrade factor such as a shift in consumer demand. Or
the President may base his decision on evidence supplied to him by
other agencies, including foreign governments. Or the President may
decide that some overriding consideration of the national interest
may require disregarding of the fact of injury. It is obvious, therefore,
that there is considerable uncertainty in the outcome of escape-clause
procedures.
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TRADE AGREEMENTS EXTENSION ACT OF 1 5
We believe this to be particularly unfortunate when a domestic
industry, typically a small industry, goes to great expense of both
time and money to pursue its claim before the Tariff Commission,
secures a determination by this bipartisan agency that serious injury
.as a result of imports does in fact exist, and then discovers that the
recommendation of the Commission has been disregarded on the basis
of other evidence not presented in the proceedings to which it was a
party and with respect to which it has had no opportunity to rebut
or otherwise explain.
The domestic industry has no appeal from the findings of fact of
the Tariff Commission. It has no further forum in which to pursue its
case. We believe, therefore., that our legal traditions as well as
elementary principles of justice require that the findings of fact by the
Tariff Commission be conclusive on the President as well as on all
other interested parties. We cannot, believe it desirable that these
findings of fact be set aside on the basis of evidence produced, for
example, by a foreign government or a foreign industry and channeled
through the State Department outside of the public proceedings and
beyond the public forum contemplated by the law.
Therefore, while we also recognize many other inadequacies of the
escape-clause procedure, it would seem that, as the very minimum,
the findings of fact by the Tariff Commission as to the existence of
'injury be conclusive.
We were deeply disturbed during the public hearings by testimony
from many segments of industry concerning the defense implications
of our tariff policy. As we stated. earlier in this report, "a solid United
States defense structure, founded upon a strong industrial base, is a
prime requisite for peace and security in the world." Certainly, the
impact of tariff policy upon the Nation's security must be scrutinized
with the greatest care.
Essential industries, essential plant capacities, essential skills, and
sources of essential raw materials must be preserved, developed. and
expanded so that the Nation can quickly call upon them in time of
~em.ergency.
While many advocates of a further general reduction in tariffs profess
not to be seeking complete free trade as their ultimate objective, their
underlying philosophy is that the United States should import. those
things which can be produced more cheaply abroad and that our own
economy should in turn emphasize production of those things which
we ourselves can produce more cheaply. This theory presupposes
economic specialization among the countries of the world.
We reject both the theory and its practice as perilous to the safety
of the United. States. If this were truly "one world," perhaps one
might overlook some of the fallacies we believe to be implicit in such a
philosophy, but it is not. The world is divided into two armed
camps. Both our survival as a nation and the principles of freedom
upon which our way of life is founded are at stake. Elimination of
certain industries because of their inability to match foreign competi-
tion appeals to the theorist on the ground that it is "economically
efficient." It does not appeal to us because it leaves the Nation
vulnerable to economic and military attack. Our economic strength
must have the broadest base possible.
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30 TRADE AGREEMENTS EXTENSION ACT OF 1955
Those of us who are familiar with tariff history will recall that
prior to World War I this country had no substantial chemical
industry. We paid a heavy price at the time for that gap in our
economic security. A domestic chemical industry was built up
during the war period. Immediately following the close of World
War I, cheap German chemicals flooded our market. There was no
tariff protection, and our infant industry was almost destroyed.
At that time, Dr. Frank William Taussig, noted free-trade econo-
mist, advised the United States to let Germany monopolize organic
chemicals. He said:
* * * As a matter of the international division of labor, the people of the
United States would do well to turn to other things on which they work to better
advantage, and get their dyestuffs (organic chemicals) from Germany * * *
The country ignored this advice and enacted the Emergency Tariff
Act of 1921 which gave the industry essential protection. That we
did not accept such advice was an important factor in our World War
II victory. Without synthetic organic chemicals, the United States
would have had no synthetic rubber, no sulfa drugs, and no plastics.
The industry today is facing a similar threat from reactivated and
expanded German chemical production. Already, we have been told,
domestic production of certain chemicals has ceased, and development
and expansion of new products has been hampered because of growing
competition from increasing imports. This fact becomes all the more
significant because only now is world trade beginning to recover from
the effects of war and postwar reconstruction.
The electrical machinery and electrical apparatus industry is, an-
other case in point. No one would question the essentiality to our
security of critical power installations. However, plants which have
been built since the Korean crisis on the basis of certificates of neces-
sity to defense mobilization are now partially idle because of pur-
chases of foreign electrical equipment produced with low labor costs.
In addition, such equipment installed by foreign firms, with foreign
plans, could neither be repaired nor replaced quickly. This aspect
of our foreign-trade policy gives us grave concern.
Another example is the machine-tool industry. That industry is
another bulwark of our economic and military strength. Yet machine
tools which are identical in every way to the American models----
even built to the same blueprints---can be and are being produced
abroad at a fraction of the American cost and then shipped back to
the American market. It is no answer in our minds to say that our
machines are better and, thus, can survive this type of competition.
The fact is that many foreign machine tools are of the highest grade.
France and Great Britain depended upon German machine tools
before World War II. This was an important contributing factor
to the downfall of France, and, except for the United States machine-
too] industry, it could have meant the downfall of Great Britain. We
must not depend on foreign factories for our industrial mobilization
base.
Preservation and expansion of domestic sources of essential raw
materials are also vital to our Nation's security. Yet, our capacity
to produce coal, oil, lead, zinc, tungsten, manganese, and a variety
of other raw materials, has been damaged by imports.
The above are some examples of our concern. Many other in.dus-
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TRADE AGREEMENTS EXTENSION ACT OF 1955 31
tries, such as precision and optical instruments, have presented eq'uall'y
grave cases.
H. R. 1 is devoid of any provision relating to the essential factor
of national security. Section 2 of the Trade Agreements Extension
Act of 1954 prohibits the reduction of duty on any article under a
trade agreement if the President finds that such reduction would
threaten domestic production needed for projected national-defense
requirements. The committee has received no evidence concerning
the implementation of this provision with respect to products included
in the forthcoming Japanese negotiations and the Geneva multina-
tion negotiations. H. R. 1 does not contain any standards or pro-
cedures to guide the President in implementing this important pro-
vision. Several amendments directed to a solution of this problem
were rejected by the majority-es a result, we believe, of inadequate:
consideration.
THE WAGE DIFFERENTIAL PROBLEM
There is no disagreement that the level of wages abroad is sub-
stantially below that in the United States. Foreign wages average
between one-tenth and one-third those paid domestically.
We recognize, of course, that wage levels and unit labor costs are not
the sole factors in the cost of production, either at home or abroad.
The cost of new capital, the cost of raw materials, the cost of plant
and equipment, the rate of productivity, the level of taxes, Govern-
ment-financed long-term credit and other Government subsidies on
exports, and many other items must be taken into consideration.
However, we have been impressed with the fact that the level of these
other items of cost to the foreign producer is not necessarily greater
and is often lower than that of similar cost to the American producer.
For example, interest rates on new capital in Great Britain, Switzer-
land, Belgium, the Netherlands and several other countries of Western
Europe are either the same or are approximately equivalent to pre-
vailing rates in the United States. Corporation taxes are frequently
lower. In Germany, for example, the effective corporate tax rate is
39.85 percent as compared with 52 percent in the United States, and
depreciation allowances are considerably more liberal. Moreover,
plant construction costs in Germany are approximately 50 percent of
those in the United States.
Be that as it may, the cost of labor is the largest single factor re-
sulting in the lower prices of foreign-made goods. Some suggest that
this differential can more than be compensated for by greater efficiency,
better machines, and better techniques on the part of the American
producer. In the case of certain mass-produced items, this may be
true. However, even this advantage may be only temporary as
American know-how increasingly is being exported abroad under the
various technical assistance programs.
On the other hand, the wage differential is frequently so great,
particularly with respect to articles in which labor is necessarily a
preponderant factor, that the domestic producer has an almost in-
superable handicap.
The argument is often made that the American consumer not, only
should have the opportunity to take advantage of these lower foreign
labor costs but should be encouraged to do so through legislation, such
as H. R. 1. We agree that lower prices to consumers are an important
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32 TRADE AGREEMENTS EXTENSION ACT OF 1955
objective. However, in achieving that goal, we must not overlook
the fact that American consumers are wage earners paid by American
standards.
The United States has fostered high wages and high labor standards
generally by a complex body of Federal and State legislation. We
prohibit child labor and sweatshops. We prohibit the interstate ship-
ment of prison-made goods. We encourage unionization and require
collective bargaining. We insist upon active competition through
antitrust prohibitions. We impose social security and unemployment
compensation taxes. We establisli minimum wages. We require
workmen's compensation. We impose a variety of other regulations
designed to insure the health and safety of our workers. All of these
are enforced uniformly throughout the United States despite geo-
graphic disparities. The Federal Government enforces these legitimate
improvements in our standard of living by prohibiting, under the
commerce power, the interstate shipment of goods made under condi-
tions violating the various standards established by law.
We, too, in the United. States could have lower consumer prices if
we permitted child labor and sweatshops to exist. We, too, could
make goods cheaper if the, interests of our workers were ignored.
However, we decided long ago that the standards of labor for American
workers were a more important consideration.
There is a basic and obvious inconsistency in continuing to pursue
that goal in the United States and, at the same time, in disregarding
the impact upon our own labor standards by encouraging the importa-
tion of competitive foreign goods manufactured under conditions
which would not be tolerated in our own country.
This is no theoretical, matter but a practical situation which must
be faced. Our committee was told of an American machine-tool
manufacturer who is now having his tools built in Holland. The tool
which the domestic producer could make for $10,500 is made in
Holland, from the American plans, for $5,000. It is the identical
product, and it is brought back to the United States for sale.
We cannot believe that this is healthy foreign trade. In our mind,
it is no different, no better and no worse, than if the American manu-
facturer imported the Dutch workers and employed them in his United
States plant at the wage rates prevailing in Holland. One can imagine
the indignation that such a move would cause, and rightly so. Yet,
thin is the practical effect of the transaction.
As previously stated, the report by the Commission on Foreign.
Economic Policy, declares that "American labor should not be sub-
jected to unfair competition as part of any program to expand our
foreign trade." To this statement, the President has subscribed. We
too are in accord. However, the only recommendation contained in
the report of the Commission in this regard is that "our negotiators
should simply make clear that no tariff concession will be granted
on products made by workers receiving wages which are substandard
in the exporting country." In our opinion this is completely inade-
quate. It is "unfair" to American workers in the United States to
say that labor in Japan, at 10 or H. cents an hour, is "fair" coin.peti-
tion simply because it is not substandard in Japan. By United. States
law, such standards are "unfair" in the United States, just as are
other "standards" in foreign countries relating to child labor, health,
and basic principles of active and aggressive competition as we know
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TRADE AGREEMENTS EXTENSION ACT OF 1955 33
them. The word "unfair" as applied to United States workers and
producers must be interpreted by United States standards only.
This is not to say that we should prohibit the entry of any goods
made at lower labor costs or under different standards than in the
United States. We do say that the time has come to stop ignoring these
factors of international competition. The strongest bulwark against
communism abroad would be a steadily rising standard of living based
upon a steady increase in wages in foreign countries. We have seen
no evidence that the wage differential between the United States and
foreign countries has narrowed in recent years. In fact, the gap has
widened-this at a time when foreign exports to the United States are
at an alltime high. It may well be that greatly expanded imports into
the United States will increase wealth abroad. We do not doubt it,
but we have seen little evidence that much of the benefit of such
increased trade will inure to the average workingman.
We believe that our trade negotiations should recognize the impor-
tance of work standards abroad. This does not mean that we should
seek to police foreign economies. This would be both impractical
and improper. On the other hand, the grant of a concession to our
great American market is a privilege. It is not a right, as so many
seem to think.
H. R. 1 contains nothing which pertains to labor standards. We
should explore the possibility of denying further tariff concessions to
goods made under conditions which would be substantially sub-
standard in the United States. This could be done gradually and
would furnish an encouragement to an upward adjustment of stand-
ards abroad.
An amendment along this line was offered in our committee but
was rejected summarily.
There is widespread agreement, even among the proponents of
H. R. 1, that tariff reduction will result in injury to selected segments
of the domestic. economy. Difference of opinion in this area goes
only to the degree of that injury. We are concerned over the fact
that the major impact of that injury will fall primarily upon small
business in the United States.
A small business typically depends upon one product or upon a
small group of closely related products. As a result, the adverse
effect upon such a company of foreign imports often results in the
closing down or drastic curtailment of the business operation. For
this reason, the unavoidable injury to domestic industry resulting
from further reduction in tariffs, will be borne most heavily by small
businesses and their employees.
A leading proponent of tariff reduction, in testifying before our
committee, described the plight of the wool-textile industry and. com-
mented that "the recent rash of mergers has helped." We are deeply
disturbed over the implications of that remark. The current trend
toward merger and consolidation among business enterprises is too
well-known to require further emphasis. This trend, if it should
continue unabated, will bring about a radical change in the American
economic picture.
Small, vigorous, independent businesses are a vital part of our free-
enterprise system. Any national tariff policy must give due weight
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34 TRADE AGREEMENTS EXTENSION ACT OF 1955
to this fact. However, despite its recognized importance, the Com-
mission on Foreign Economic Policy, charged by the Congress with
.an exhaustive analysis of all aspects of the Nation's foreign trade
policy, gave no attention to this problem. Nor does H. R. 1.
The relation between domestic agriculture and tariff policy are left
in complete uncertainty by H. R. 1.
The United States today imposes quotas on the importation of
specified agricultural commodities in order to maintain the integrity
of domestic farm price support programs. The use of such quotas by
the United States is today under violent attack by most of the other
parties to GATT. The United States has already bound itself in
GATT against the use of additional quotas in the future. As a result,
Congress is in effect precluded from putting new agricultural com-
modities under the quota system should the need arise. Such an ac-
tion would be deemed a violation of the spirit of our commitment to
GATT.
While section 22 of the Agricultural Adjustment Act, as amended,
authorizes the imposition of quotas on the importation of commodi-
ties which are subject to price support, all other domestic agricultural
commodities are without this protection. As a result, the same
authority to reduce rates and other import restrictions is extended to
the President with respect to these other agricultural commodities
.as is applicable to imports generally.
We have already pointed out that the organizational features of
GATT are to be submitted to the Congress this session. It has been
stated that H. R. 1 itself has no implications insofar as GATT is
concerned. However, we believe that this is a judgment which the
Congress is entitled to make for itself. This is especially true when
it is dealing with a function which is vested specifically in the Con-
gress by the Constitution. Therefore, we recommend that H. R. 1
not be acted upon until at least the organizational features of GATT
have been laid before the Congress.
In this same connection, the last Congress directed the Tariff
Commission to make a complete study of all provisions of the customs
laws under which imported articles may be classified for tariff purposes.
The Commission was directed. to compile a revision and consolida-
tion of the classification provisions, and to make its preliminary
report to the Committee on Ways and Means by March 15, 1955
(Public Law 768, 83d Cong.). The report in question has not been
received. It should be considered before further modifications of
our tariff policy are acted upon.
We have also pointed out that trade negotiations are about to com-
mence with Japan. Upon the list for possible concessions to Japan are
such items as textiles, organic chemicals, cameras, chinaware, pottery,
glassware, porcelain, optical instruments, fish products, and a great
variety of other items. Any concessions to Japan will, of course, be
extended automatically to other countries under most-favored-nation
principles. And, as previously stated, H. R. 1 also contains a unique
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provision specifically authorizing the United States to grant conces-
sions to third countries in return for their granting concessions to
Japan.
The forthcoming Japanese negotiations will have tremendous impli-
cations for the American economy. No less significant will be the
subsequent negotiations with many GATT parties in Geneva. As
already pointed out, Congress cannot possibly measure the additional
grant of tariff reduction power contained in H. R. 1 until all these
negotiations are completed. As we all know, in the past without
obtaining reciprocal benefits our international negotiators have given
away the bulk of our bargaining position in the field of world trade.
Today, there remains little with which to obtain concessions from other
countries. How can one justify a feeling of confidence in these
negotiations for the future?
We therefore recommend that the additional power contained in
H. R. 1 should not be delegated until the Congress has more informa-
tion than it has today concerning the effect of forthcoming negotiations
and until the report of the Tariff Commission has been received and
studied.
DANIEL A. REED.
THOMAS A. JENKINS.
RICHARD M. SIMPSON.
NOAH M. MASON.
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APPENDIXES
CRrfcismS OF TRADE AGREEMENTS PROGRAM
Charge: United States tariffs are already too low
Some opponents of the bill have testified that the United States.
tariffs are lower than those of most other countries. Starting from
this premise they argue that the United States should not reduce its.
tariffs further. Several. arguments can be set forth to rebut this
contention. First, any discussion of levels of tariffs is misleading.
Average levels found- by computing the arithmetical rates between
duties collected and the value of total dutiable imports does not give
a meaningful picture. Indulgence in such a "numbers racket," as
stated by Secretary of State Dulle,4, is not very fruitful. Secondly,
the restrictiveness of a duty bears little relationship to the height of'
the tariff. A mathematically low duty on one product may be more
restrictive than a high duty on another product. As tariff rates
become more restrictive, therefore, they decrease the customs revenues
collected and result in a lower rather than a higher ad valorem equiva-
lent. Thus, to carry the reasoning to its logical conclusion, if the
rates were made high enough to keep out all dutiable imports, the
average ad valorem equivalent would be reduced to zero.
The Secretary of State in his testimony before the committee stated
succinctly the other and more important reasons why it would not-
be in the national interest to cease tariff reductions. Ile pointed out
that because the United States is the world's principal economic unit
that it has the heaviest responsibility in the economic field. Other
nations fear that the United States may shift the direction of our
trade policy and turn to raising rather than lowering trade barriers.
"Such fears, unless allayed," he said, "could set up a chain reaction
which would gravely damage and disrupt the free world. It would.
bring to pass what Soviet forecasters have predicted and would pro-
vide hostile rulers with another opportunity greatly to expand their
power."
The Secretary also pointed out that unless the United States remains
in a position to exert a continuing influence upon the trade policies,
of the free world, the possibilities for expansion of foreign trade else-
where probably will not be realized. New negotiating powers for the
President will "enable the United States to make a new start in
promoting freer trade policies on the part of other nations."
Charge: The trade-agreements program is not reciprocal
Another charge against the trade-agreements program is that
other countries have nullified concessions to United States export
trade by various restrictions against dollar imports. While it is true
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that restrictions have been imposed on imports from the dollar area,
these barriers have their roots in the need to conserve foreign exchange.
As the balance-of-payments situation of those foreign countries with
which we have trade agreements has improved they have relaxed
their restrictions on imports from the United States.
A survey prepared by the Department of State reveals that import
restrictions vis-a-vis the dollar area have been relaxed throughout
the world during 1954. This survey is divided into two parts, one a
listing of the overall liberalization that has taken place, and the second
section dealing with specific cases of restrictions which have been
alleviated through utilization of trade-agreement mechanisms.
1. RESTRICTIONS ON IMPORTS FOR BALANCE-OF-PAYMENTS REASONS
During the post-World war II period many countries considered it necessary to
take severe measures to, help pull their economics out of the difficulties created
by the war. Faced with limited supplies of dollars with which to pay for the goods
they wished to buy from the United States, they have had to ration their funds
through the use of import restrictions on dollar goods. The United States,
recognizing the difficult economic situation created by the war, has attempted
to minimize the damage to its commerce which has unavoidably resulted from
these rationing measures. It has tried to insure that the restrictions would he
relaxed as soon as improvement in the financial positions of the importing countries
permitted. Consultations have been held with many countries in the General
Agreement on Tariffs and Trade, the International Monetary Fund, the Organiza-
tion for European Economic Cooperation, and in bilateral talks concerning dollar
import restrictions.
These efforts by the United States have in part led to progressive elimination of
restrictions against dollar goods. The 1954 Annual Report of the International
Monetary Fund states: "There was a general trend toward the removal of barriers
on trade and payments, and restrictive practices have been considerably reduced
and modified."
A quantitative estimate of the extent of liberalization throughout the world is
extremely difficult to develop. However, for Western Europe there has been a
significant relaxation of restrictions on dollar imports since the beginning of 1953.
In that year only three countries in Western Europe--Belgium, Switzerland, and
the United Kingdom-had any degree of freedom with respect to goods imported
from the dollar area without any limitation by licensing authorities. By the
beginning of 1955, 7 additional countries had liberalized imports from the dollar
area, with the overall percentage of liberalization for these 10 countries amounting
to almost 60 percent based on statistics for imports on private account in 1953.
The chart at the end of this section shows the extent of progress in freeing dollar
imports from restrictions by these 10 OEEC countries. It should also be noted
that the extent that restrictions against dollar imports have been relaxed would
reflect even greater progress if account were taken of the more liberal treatment
that is being afforded such imports by licensing authorities.
The following brief summary reflects the actions taken by the major trading
countries of the free world to liberalize imports from the dollar area. Those
countries which are not included have not relaxed their restrictions during the
past year.
1. Western Europe I
Belgium, Netherlands, and Luxembourg.- -A common free list for imports from
the dollar area generally similar to that for the OEEC countries was made effec-
tive on June 1, 1954. Licenses for the items on this free list are automatically
granted. Included among the freed products are such agricultural commodities
as wheat, barley, corn, flour, fats, raw tallow, tobacco, raw cotton, figs, almonds,
nuts, apricots, and phosphate fertilizer; such raw materials as many chemicals,
copper, and petroleum oils; and such manufactured products as iron and steel
sections, engines of various types, calculating machines, generators, and electric
I As used in this section the phrase "liberalization percentage" reflects the percentage of private imports
from the United States and Canada in the base period of 1953 of the commodities that can be imported with-
out obtaining the prior approval of the licensing authorities.
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38 TRADE AGREEMENTS EXTENSION ACT OF 1955
motors, certain parts and components for motor vehicles and tractors, aircraft,
locomotives, passenger coaches, motorcy]es, dolls, and toys. The liberalization
percentage totals S6 percent.
Denmark.-The first maior step in freeing dollar imports was taken in December
1P54. Trnport licenses will be issued automatically for such goods on the dollar
free list as raw tobacco, cotton, asphalt, lumber, paper, many chemcials, medicinal
articles, optical glassware, various tools and instruments, sewing machines, agri-
cultu ral machinery, textiles, printing, packing and other machines, machine tools,
and telephone and telegraph equipment. By this action, a liberalization per-
centage of 38 percent was achieved. The Danish Government has indicated
that the dollar free list will be expanded as soon as conditions permit but, in the
interim, it liberal policy will be followed in granting licenses for dollar goods.
C,ermany.-The issuance of a dollar free list covering 2,000 items in February
1954 was followed in November 1954 by the addition to this list of about 1,800
more items. Items on the dollar free list are automatically issued import licenses.
Item=s included in the first list were mainly raw materials, such as cotton, wool,
nonferrous ores, ferroalloys, crude oil, and a number of chemical raw materials.
In addition there were such categories of semifinished and finished goods as
machine tools, machinery, electrotechnical goods, precision instruments, and
glass and ceramics. The second list included petroleum lubricating oil, paper,
washing machines, some types of refrigerators, electrical sound equipment, cer-
tain types of leather, and vulcanized fibers. As in the original list, however,
there were no food or agricultural items in this second list. The restrictive
policy toward imports of United States coal was relaxed in December 1954 when
it was announced that licenses would be issued for the importation of 40 million
deutsc]Femarks of United States coal provided payment was in a nonconvertible
currency. The liberalization percentage amounts to about 70 percent.
Greece.---Except for a limited number of specified goods, there are no quanti-
tative restrictions on imports. The liberalization percentage totals 90 percent.
Ice!ana'.-Iceland has a free list for which import licenses are not required.
Included among the items on the free list are cereals, flours, raw coffee, fruit
juices, certain oils, raw cotton, hemp, cr stain metallurgy products, nonferrous
metals, refined petroleum, aviation gas, certain lubricants, certain textiles, and
miscellaneous manufactured goods. The liberalization percentage totals 33
percent.
Italy.--Extended its free list on goods from the dollar area which do not require
import licenses on August 10, 1954, so as to raise the liberalization percentage
from 10 to 24 percent. Included in this new list of liberalized products are such
items as vegetable waxes, coal, crude petroleum oils for refining, certain minerals,
rags, waste, synthetic and artificial rubber, woodpulp, cast iron, iron and non-
ferrous ores, iron, steel, and cast iron scrap, crude copper and copper alloys and
scran, carbon black, and certain other chemicals and pharmaceuticals.
Norway.-While requiring import licenses for all goods from the dollar area,
the Government adopted a new policy in March 1954 of granting licenses for
imports of essential goods without regard to the previous requirement that there
be at least a 10-percent price advantage over nondollar goods. Essential com-
modities include petroleum, raw tobacco and cotton, soybeans, semifabricated
iron and steel, certain chemicals, and agricultural and other machinery.
Sweden..--0n October 1, 1954, Sweden established a dollar-free list which released
a wide range of commodities of dollar area origin from import license require-
ments. At the same time, the Government announced that licenses for the
importation of other goods from the dollar area which were on the OEEC free
list would be granted in greater quantities. The dollar free list includes a great
majority of the commodities on which Sweden granted tariff concessions to the
United States under the GATT. The list covers such items as manufactures of
iron and metal, almost all chemical products, hides and skins, rubber, products,
wood goods, all paper other than newsprint, textile raw materials, yarn, cord
fabrics, shoes, hats, stone, clay and glass products, iron and steel. products,
machines, apparatus and instruments except cameras, projectors, and musical
instruments, equipment for railways, streetcars, motorcycles and bicycles, dried
fruits and raisins, rice, canned fish, canned fruits and juices, handbags, fishing
tackle, tobacco pipes, fountain pens, and many other consumer goods. The
liberalization percentage totals 40 percent.
Switzerland.-There is no discrimination against imports from the dollar area.
Import licenses are not required except for a small list of items. The liberaliza-
tion percentage amounts to 98 percent.
United Kingdorn,.--In the past 2 years the Government has taken extensive
steps in .returning to private trade the importation of many commodities. For
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the most part this action was followed by the establishment of international
commodity markets and the freeing of imports from the dollar area. Included
were such commodities as nickel, copper, lead, zinc, raw cotton, and wheat.
In June 1954, imports of oilseeds, oils, and fats were allowed freely from the dollar
area under open individual licenses and restrictions were eased on the importation
of dollar machinery. Further relaxation of restrictions occurred in December 1954
when the quota for imports of passenger automobiles from the United States was
increased from approximately 240 cars annually to 500 and the quota for hardwood
imports was raised. The liberalization percentage amounts to almost 50 percent.
II. Africa
Union of South Africa.-Since January 1, 1954, the import control system has
been. nondiscriminatory in character insofar as source of imports is concerned.
In October 1954 the Government announced that it was proceeding with the
gradual relaxation of import controls and hoped to remove the controls entirely
in the not too distant future, depending upon the rate of improvement in the
balance of payments. In 1955 the Government announced that the requirements
of the manufacturing industries for raw materials would be almost fully met;
the importation of industrial machinery would be on an even more liberal' basis...
than in 1954; quotas for agricultural machinery and implements would be in-
creased; consumer goods imports would be increased and the list of totally pro-
hibited items would be decreased. Further, import permits would no longer be
required for textile piece goods, tea, coffee, raw cotton, raw wool, and certain,
types of stationery.
Ethiopia.-As of the end of 1953, imports from the dollar area were placed on:
the same basis as imports from other currency areas thereby abolishing the
discrimination which existed against dollar imports. Further, during the past
year, exchange was freely granted for the. import of all goods from any source.
Federation of Rhodesia and Nyasaland.-On July 1, 1954, restrictions on imports
from the dollar area were eased. Many items previously subject to quota limi-
tations were added to the unrestricted list, i. e., the list of items not under cur-
rency quotas but still requiring import licenses which are issued subject only to.
scrutiny. Such items include animal feeding stuffs; condensed milk; dried milk;
edible nuts, excluding groundnuts; hand tools; outboard motors over 20 horse-
power; filter plants and filters for the purification and softening of water; lifts,
hydraulic or electric and gates; air-conditioning machinery; insecticides; medicinal
drugs and chemicals; disinfectants; veneers; and sensitized paper. Further, there
were significant dollar allocations for such goods as wheat, agricultural, mining
and industrial machinery, steel, electrical goods and spares, commercial vehicles,
special tires and tubes, plywood and office equipment.
Libya.-In November 1954, the Government announced the relaxation of re-
strictions on dollar imports considered necessary to the Libyan economy, Such
goods include agricultural and industrial equipment and seeds, essential foodstuffs
such as wheat and barley, second-hand clothes, medicines and drugs, essential
household appliances such as refrigerators and sewing machines, commercial,
vehicles and spare parts for automobiles, and other machines, construction equip-
ment, newspapers, magazines, and periodicals.
III. The Far East
India.-Restrictions, which had held dollar purchases to the barest minimum
for the past several years, have been reduced for 1955. Liberalization has taken
the form of increased quotas and the possibility of importers utilizing a portion
of their soft currency licenses for dollar imports.
Pakistan.-A new import policy for the first half of 1955 was announced which
would maintain import licensing requirements but would be for the most part
nondiscriminatory with respect to imports from the dollar area. Further, the list
of importable items was increased from less than 200 items to over 300 and includes-
essential consumer goods. In addition, there was an increase in the established.
quotas for dollar-area imports.
New Zealand.-The restrictions on dollar imports have recently been relaxed'
by providing for substantial increases in the list of goods which can be imported
freely from all sources. In addition, exchange allocations for dollar imports have
been increased.
Thailand.-Practically all imports now require licenses, but this action was
taken to discourage speculative imports. However, there is no discrimination as
to source of supply. Licenses are automatically granted for "essential" goods.
and imports of "semiessential" goods are permitted up to the highest value of
imports during any of the 5 preceding years. While some "luxury" goods ; are
prohibited, licenses are issued for others.
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Guatemala, Haiti, Honduras, Nicaragua, Panama, Peru, and Venezuela have
only nominal restrictions, if any, on dollar imports.
2. SPECIFIC CASES WHERE TIIE UNITED STATES HAS SUCCEEDED IN HAVING
RESTRICTIONS AGAINST DOLLAR GOODS ELIMINATED
(a) Token imports.-The United States has been pressing foreign governments
which are maintaining balance-of-payments import restrictions to permit the
entry of limited quantities of American products in order to permit American
traders and their products to retain a foothold in markets established before
financial difficulties necessitated rationing of dollars. The United States has been
able to make representations on this subject to the major trading countries of
the world because of the provisions contained in the General Agreement on Tariffs
and Trade which require countries imposing balance-of-payments restrictions "not
to apply restrictions so as to prevent unreasonably the importation of any descrip-
tion of goods in minimum commercial quantities, the exclusion of which would
impair iegular channels of trade, or restrictions which would prevent the importa-
tion of commercial samples or prevent compliance with patent, trade-mark, copy-
right, or similar procedures * * *"
Token import arrangements have been in effect in the United Kingdom for
some years. Other contracting parties have different arrangements which give
effect to this requirement. Discussions have been held with Australia, Pakistan,
Sweden, New Zealand, and Chile for the establishment of similar arrangements.
(b) United Kingdom purchase of apples.-The United Kingdom in 1951 was
making arrangements for the purchase of apples in a manner which would have
discriminated in favor of Canada and against the United States. The United
States, in consultations with Canada and the United Kingdom, argued, on the
basis of the general agreement, that the British could not apply import restrictions
in a way which would discriminate between two hard-currency countries. The
resulting arrangement provided for equal treatment of the two countries.
(c) Discriminatory Haitian price regulations affecting United States cigarettes.-
A government tobacco monopoly in Haiti increased the retail price at which im-
ported American cigarettes could be sold but did not increase the retail price at
which domestically manufactured cigarettes could be sold, which resulted in dis-
crimination against American cigarettes that might have decreased considerably
the market for imported American cigarettes in that country. This Government
through the American Embassy called attention to paragraphs 1 and 4 of article
III of GATT. The discrimination has since been ended.
(d) Cuban lumber tax.-Cuba levied a 9-percent sales tax on imports of lumber
and exempted domestic lumber from the tax. Attention was called by this
Government through our Embassy to the first two paragraphs of article III, and
as a result the tax was made nondiscriminatory by applying it also to domestic
lumber.
(e) Cuban import tax.-Cuba proposed to levy an 8-percent tax on imported
food products, with no tax on domestic products. Attention was called by this
Government through our Embassy to the first two paragraphs of article III of
GATT, and the proposal was never put into effect.
(f) Cuban periodicals tax.-Cuba levied a 9-percent sales tax on imported news-
papers and magazines, exempting domestic newspapers and magazines from the
tax. Attention was called by this Government through our Embassy to article
III of GATT and as a result imported newspapers and magazines were also
exempted from the tax.
(q) Haitian import surtax.-Haiti increased the 3-percent customs import
surtax to rates varying from 3Y2 to 4~ z percent on a relatively long list of products.
This Government through its Embassy pointed out that any such increase on
products listed in the Haitian schedule of GATT would be in contravention of the
provision in article II. The foreign government took immediate steps to end the
contravention by snaking sure that the increase did not apply to scheduled
products.
(h) Cuban import quotas.-Cuba refused to allow two large shipments of po-
tatoes from the United States to. enter the country. This Government, through
the American Embassy called attention to the provision of article XI of GATT,
which states that no prohibitions shall be instituted or maintained by any con-
tracting party on the importation of any products of any other contracting party,
except as specified. The two shipments, which might have spoiled, with consider-
able loss to the exporter, were as a result of this protest later allowed to enter.
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TRADE AGREEMENTS EXTENSION ACT OF 1955
(i) Cuban textile embargo.-Cuba placed in effect import restrictions on textiles
that amounted to a virtual. embargo. Hundreds of thousands of dollars worth of
shipments of textiles and related products from the United States were held on the
docks or in customs warehouses in Cuba. When the Government in question
failed to remove the restrictions, the United States Government brought the
matter before the contracting parties to GATT, which were then in regular session
at Geneva, claiming that the restrictions were in violation of article XI of GATT
and invoking article XXIII of GATT to the effect that the restrictions nullified
substantial concessions which Cuba had granted the United States in schedule IX
and other provisions of the general agreement. The contracting parties discussed
the matter, and the Cuban Government promptly took steps to relieve the.
situation.
(j) Dominican import restrictions.-The Dominican Republic banned the im-
portation of ice-cream mix, which carne principally from the United States. The
American Embassy at the request of this Government discussed the matter with.
officials of that Government, pointing out that such a restriction was in contra-
vention of article II of GATT. The restriction was promptly removed.
(k) Dominican auto-import restrictions.-The Dominican Republic published
a resolution prohibiting the importation of automobiles valued at more than
$1,250, except under special permit, which was at first not being granted. The
American Embassy at the request of this Government called the attention of
that Government to the provisions of article XI and later reported to the Depart-
merit of State that the importation of cars valued .at more than the figure men-
tioned was being regularly permitted.
(1) United Kingdom tobacco-mixing requirement.-In 1950-51, the United States
was successful in securing modification of a British requirement that to the
amount of 5 percent of the total oriental tobacco be mixed with Virginia tobacco.
On the basis of the obligation in article III of the general agreement, the British
agreed to permit again the manufacture of pure Virginia cigarettes, as desired
by the United States tobacco industry.
(m,) Brazilian coffee-export restrictions.-The United States Embassy in Rio de
Janeiro made representations to the Government of Brazil in 1951 concerning
the applications of monthly export quotas on coffee. The United States protest
held that the Brazilian action was in violation of article XI of the general agree-
ment. The system of export quotas was subsequently altered and the basis for
the complaint removed.
(n) Discrimination against American petroleum interests.-Denmark in late
1953 tried to pressure American petroleum companies in that country to purchase
some of their petroleum requirements from Soviet bloc sources. The United
States Embassy intervened to protest against this discrimination. In doing so
it refuted an attempted balance-of-payments justification presented by, the
Danish Government. The Embassy based its arguments on the principle em-
bodied in article XII of the general agreement, that is, that Denmark's financial
position, as measured by the criteria of article XII, did not permit such onerous
restrictions. Denmark dropped its request of the American oil companies.
(o) French export quotas on raw angora wool.-The United States protested in
February 1954 to the French against the application by France of export quotas
on raw angora wool. The complaint held that the quotas were inconsistent with
Article XI of the general agreement. This case is presently under consideration.
(p) Brazilian marking requirements.-In July 1952 the United States protested
to Brazil that a relaxation with respect to imports from Chile of a requirement
that bags be marked in indelible ink should be extended to imports from the
United ?tates. The basis for the United States protest was article IX of the
general agreement which requires most-favored-nation treatment with respect
to marking requirements. The Brazilian Government then instructed its customs
officers to extend to the United States on a most-favored-nation basis the treat
merit which applied to Chile.
(q) Peruvian discrimination against United States cosmetics.-The United States
protested in 1951 and 1952 against the imposition by Peru of internal taxes which.
discriminated against imports of cosmetic goods from the United States. The
United States based its protest on article III of the general agreement, which
prevents internal taxes from beinp, imposed on imports in a more burdensome
manner than on like domestic products. Subsequently, Peru took steps toward
removing the discrimination,
(r) United Kingdom purchase tax.-The United Kingdom imposed a purchase
tax on imported goods which were comparable in price and quality to domestically
produced goods which were generally exempt from the tax. The issue was raised
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42 TRADE AGREEMENTS EXTENSION ACT OF 1955
at a session of the contracting parties as a violation of article III. At the seventh
session (in late 1952), the United Kingdom announced the removal of the dis-
crimination between imported and domestic goods.
(s) French 0.4-percent tax.-The United States at the session held in the fall of
.1953 challenged as inconsistent with the general agreement a tax imposed by
France on all inports and exports amounting to four-tenths of 1 percent by value.
The United States held that the tax nullified or impaired tariff concessions made
by France under the agreement. France agreed that the tax did infringe the
provisions of the agreement and expected that it would not be continued in the
new budget. This tax has now been abolished.
(t) Peruvian automobile import tax.-At the time Peru was negotiating for
accession to GATT, it developed that Peru contemplated imposition of a charge
on imports of certain classes of automobiles, which the United States regarded
would have violated the general agreement. On the basis of our explanation
of the problem to Peru, it was decided to convert the import charge into an internal
tax which would apply to any domestically produced automobiles as well as to
imported cars.
(u) French West African preferences.-In 1951, France announced its intention
of increasing most-favored-nation duties on so-e 40 items when imported into
French West Africa from foreign countries, while leaving imports from France
free of duty. France recognized that such action would require compensation,
.but on the basis of United States protests, based in part on France's obligation
not to increase preference margins over the preference in a base period, France
withdrew the request late in 1952. At the tire, it was stated that the request
might be renewed later, but to date the question has not been brought up again.
A considerable amount of United States trade (amounting to $3.5 million in 1
year) thus still enjoys lower rates when imported into French West Africa than
would otherwise be the case.
(v) Restrictions and discriminations against American motion pictures-(i)
Austrian itip ort restrictions.-In 1953 the United States protested, on the basis
,of article (which contains a general prohibition against import restrictions),
import restrictions against American motion pictures. Discussions have not been
concluded in this case.
(ii) Belgian restrictions.-In 1951, when Belgium made known that it was
imposing restrictions for balance-of-payments reasons and was giving motion-
picture distributors 3 days to make counter proposals, the American Embassy
in Brussels interceded on behalf of the American movie industry. It brought to
the attention of the Belgians the obligation in the general agreement for consulta-
tions in regard to the imposition of balance-of-payments restrictions. The result
was that these strictions were postponed, and much milder restrictions were
later imposed after consultation with the industry.
The American Embassy in Brussels in 1951 had the occasion to notify the Bel-
gian Government that the general agreement required Belgium to give public
notification of restrictions without regard to whether they were temporary, a
reason the Belgians advanced for not giving publicity to the measure. Following
;United States representations in this case the imposition of the restrictions was
postponed, and more satisfactory arrangements were worked out following
discussions.
(iii) Brazilian regulations.-In January 1952 the United States invoked article
II, paragraphs 1, 2, and 4, of the general agreement against a new decree and a
draft bill which were judged to have a more burdensome effect on American
motion pictures than measures in effect on the date of the general agreement
(October 1947). The measures required importers to acquire domestic newsreels
and shorts to the extent of 10 percent of the footage imported in a previous year.
The draft bill was supplanted by another which did not contain the objectionable
provision. The decree was later nullified by the Ministry of Justice on the
grounds that it was a violation of the general agreement.
The American Embassy in Rio de Janeiro has been instructed to bring to the
attention of the Brazilian Government the fact that a draft bill submitted to the
Brazilian Congress would violate article III, paragraph 2 (by imposing a dis-
criminatory internal tax), would violate article VII, paragraph 1 (by imposing a
fee in excess of the cost of services rendered in connection with the importation),
and would impair tariff concessions granted on motion pictures. No further
progress has been reported on the draft bill.
In November 1952 the United States invoked article XI, paragraph 1, of the
-general agreement in protest against a Brazilian decree which called for an import
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limitation of one print per film. The application of the decree was postponed,
and, while the question has not been finally disposed of, restrictions provided by
the decree have not been made effective.
(w) Norwegian internal taxes.-The United States invoked article III on April
28, 1950, against a 1949 regulation exempting from taxation the revenue derived
by theaters from exhibition of Norwegian newsreels but not foreign newsreels.
On August 1, 1950, foreign newsreels were also exempted from the admission tax
and placed on the same footing as Norwegian newsreels in response to the
Embassy's representation.
DENMARK
GERILANY
GRF:CE
ICEIJUW
Liberalization Percentage.-The percentage of private imports from the United
States and Canada in the base period of 1953 of the commodities that can be
imported without obtaining the prior approval of the licensing authorities
38
I
L As of 1/1/53
As or 1/1/155
20 10 60 80
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44 TRADE AGREEMENTS EXTENSION ACT OF 1955
Charge: Passage of H. R. I should wait for GATT renegotiation
Some witnesses before the committee have urged that action on
H. R. 1 be delayed until after the General Agreement on Tariffs and
Trade has been negotiated and presented to the Congress for approval.
There is no valid reason for delaying action on H. R. 1. The -
General Agreement on Tariffs and Trade is a multilateral trade agree-
ment. The Congress has never undertaken to approve the specific
terms of any trade agreement in its consideration of the trade-agree-
ment legislation.
As far as the organizational provisions of the GATT are concerned
the President in his March 30, 1954, message to Congress and his
January 10 message of this year indicated that as soon as the negotia-
tions in Geneva are completed he will submit the organizational
provisions to the Congress for approval.
Charge: Passage of H. R. i should await the outcome of Japanese tariff
negotiations
Those who have urged that action on H. R. 1 be delayed until after
the results of the Japanese tariff negotiations are known do not appear
to comprehend the purpose of H. R. 1. Authority under the present
act exists for completing negotiations with Japan. However, the
success of the negotiations might be jeopardized if the negotiations
had to be completed before June 12, 1955. United States negotiators
should not be forced to race against time. The opportunity for
negotiating successfully with Japan and with. the other countries that
will be participating in the negotiations will be greatly increased if the
United States delegation is not under pressure to complete the bar-
gaining by a particular date. H. R. 1 provides that if the trade agree-
ment involving Japan is entered into after July 1, 1955, the authority
to decrease a rate to 50 percent below the January 1, 1945, rate would
continue but the authority to reduce the rate by 15 percent would
not be available for products included in the agreement when the
reduction was more than 15 percent of the July 1, 1955, rate.
Charge: Defense industries and skills are not adequately protected
Witnesses who claimed that their particular industries were essen-
tial to the defense of the United States asserted that . the Trade
Agreements Act does not provide the protection which they requi- e.
Insofar as the Trade Agreements Act, as extended by Public Law
464, 83d Congress, is concerned, provision has been included to safe-
guard against tariff reductions which might affect defense industries.
Section 2 of this law provides that no action shall be taken-
to decrease the duty on any article if the President finds that such reduction would
threaten domestic production needed foi projected national defense requirements.
Therefore, under present procedures the President must give careful
consideration to the defense implications of any suggested tariff
reduction.
Suggestions have also been made that the Tariff Commission should
decide what industries are essential to national defense. The responsi-
bility for taking into account national security considerations properly
belongs with the President who will obtain the advice of the National
Security Council, the Department of Defense, and other executive
agencies directly concerned with these matters.
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APPENDIX B
THE EXECUTIVE I)EPARTMENT'S TESTIMONY AND SUPPORT OF H. R. 1
The President. fn 1954 and again in January of this year President
Eisenhower has given firm support to the program embodied in this
bill.
His foreign economic policy message of March 30, 1954, stated the
issue in clear terms:
If we fail in our trade policy, we may fail in all. Our domestic employment,
our standard of living, our security, and the solidarity of the free world- -all are
involved.
I am convinced that the gradual and selective revision of our tariffs, through
the tested method of negotiation with other nations, is an essential ingredient of
the continuing growth of our domestic economy. An expression of our willingness
to negotiate further will offer needed leadership toward the reduction of trade and
payments barriers that limit markets for our goods throughout the world.
On January 10 of this year the President reemphasized the impor-
tance of renewal and expansion of the President's authority in the
trade-agreement field. As he said at that time:
It is essential for the security of the United States and the rest of the free world
that the United States take the leadership in promoting the achievement of those
high levels of trade that will bring to all the economic strength upon which the
freedom and security of all depend. Those high levels of trade can be promoted by
the specific measures with regard to trade barriers recommended in this
message * * *.
Six members of the Cabinet and the Director of the Foreign Opera-
tions Administration, appeared before the committee. All gave
unqualified support to the bill.
The Secretary of State, Hon. John Foster Dulles, supported the bill
in these words:
Specifically, I urge the extending of Trade Agreements Act by enactment of
H. It. 1. This extension, I am convinced, will promote the security and welfare
of the United States.
In this economic field many nations have a responsibility. But the heaviest
responsibility lies upon the United- States. That is because we are the world's
principal economic unit. Although the United States represents less than 7
percent of the world's population, we account for more than 40 percent of the
world's production. Our trade accounts for between 15 and 20 percent of the
world's total trade. We are the largest single supplier of, and the largest single
market for, many foreign countries. Therefore, our economic behavior is of
tremendous importance to our friends and allies. Indeed, we would quickly
alienate our friends and allies if we followed trade policies which cut across their
vital needs.
Other countries are uncertain as to the future trend of our trade policies. They
fear that we may shift to a policy of raising rather than lowering tra 'e barriers.
Such fears, unless allayed, could set up a chain reaction which would. gravely
damage and disrupt the free world. It would bring to pass what. Soviet fore-
casters have predicted and would provide hostile rulers with another opportunity
greatly to expand their power. -
A principal advantage of the bill, from the foreign relations standpoint, is that
it extends the Trade Agreements Act for 3 years, and that increases certainty.
A second important factor of the bill, from the standpoint of foreign relations,
is that it provides the President with new negotiating powers which will enable
45
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46 TRADE AGREEMENTS EXTENSION ACT OF 1955
the United States to make a new start in promoting freer trade policies on the
part of other nations. The United States cannot itself be the recipient of all the
surpluses of other countries. The greatest possibilities of foreign-trad3 expansion
exist elsewhere. But these possibilities cannot be realized unless the United
States is in a position to exert a continuing influence upon the trade policies of
the free world.
I hope, _llr. Chairman, that I have not given the impression that the pending
bill would Primarily serve the economic interests of others. That is by no means
the case. But I do not hesitate to say that even if it were the case, I-would still
advocate the bill as needed to preserve the unity and vigor of the free world in the
lace of the terrible menace that confronts it. In time of war we make sacrifices
that are immense. I believe that in peace we should also be prepared to make some
sacrifices in order to hold together a free world partnership which is indispensable
to the peace and security of each of the parties.
I- appily, however, we ('o not need to think of this bill as sacrificial, even in
terms of trade. It is a hill to expand our foreign trade. And that is good business
for us.
Our foreign policy, as I have put it in capsule form, is to enable the people of
this country to enjoy in peace the blessings of liberty. I am convinced that that
result cannot be achieved without cooperative trade relations of a dependable
character between the free nations.
This pending bill and its counterpart, H. R. 536, are the only practical vehicles
I know of for enal- ling us to promote that cooperation. In my opinion the failure
at this stage of world affairs, to rededicate our Nation to liberal trade policies,
and to do so for a 3-year term would have grave consequences.
The Secretary of the Treasury, Hon. George Humphrey, stated his
view of the importance of the bill in unequivocal terms:
First, the importance of keeping our own economy strong and dynamic and
sound. Our policies are directed toward economic strength and growth-toward
greater freedom from governmental interference and control. Our policies aim
at encouraging initiative and freedom and maintaining economic progress and a
high level of economic activity at relatively stable prices. Such a condition
helps international trade in both directions. A strong internal economy helps
to keep us competitive and makes our goods attractive to foreign buyers. It also
promotes a high level demand for imports. With high levels of business activity,
the capacity of our economy to absorb imports is enormous-particularly im-
ports of raw materials.
The second. point which has impressed me in my contacts abroad is the concern
of foreign countries with the broad direction of our commercial policy. Foreign
countries do not expect us to lower our tariffs drastically. What they want to
have, however, is assurance of continuity in our policies and they watch for
moderate steps in the direction of our objectives. This argues strongly for a
3-year extension of the trade-agreements program. A 3-year period is needed
to provi'e reasonable assurance of such continuity.
The bill before you is moderate. It does not interfere with existing safeguards
for our c'omestic producers. It does not contemplate any drastic changes which
would adversely affect sizable groups of citizens.
I would like to mention one other broad principle in connection with the bill.
From the budgetary viewpoint, the President's trade program should help to
re,..uce Government expenditures for foreign aid over a period of time. I believe
it is best, where possible, for foreign countries to earn their way, rather than
receive aid from the United States Treasury. This bill is a further step in that
direction.
The Secretary of Agriculture, Hon. Ezra Taft Benson, emphasized
the importance of this bill to the agricultural prosperity of the
United States:
The modern farmer is a specialist. lle is, you might say, a manufacturer.
Ile combines his land; personal, family, and hired labor; capital; seed, fertilizer;
etc.; and produces products for the market. Ile uses increasing amounts of
machinery and other capital, and lie concentrates his efforts on a few commodities
which are suited to his particular farm. This has led to specialized areas: cotton
and tobacco in the Southeast, corn and hogs in the Midwest, potatoes in Idaho
and Aroostook County, Maine, and so on.
Clearly this specialization would have been impossible without trade.
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 Approved F A~ F~RjGI-1o~9A9Q24AgP01003g1nce-in tr-.ding relationships.
The provisions of this bill-namely the modest and gradual reduction of United
States tariff harriers on a reciprocal basis-can help speed up the progress which
free nations are making in their own economic development programs. Passage
of this bill will add one more push to the economic development we are all seeking,
a development which is in the self-interest of the United States.
I support this bill, H. R. I., because it is in what the President has called the
"enlightened self-interest of the United States." There is, I believe, a vast
difference between self-interest and selfish interest. Were benefits proposed in
this bill to come only to the United States, it would represent only selfish interests.
The benefits, however, will be widespread. They will be for the self-interest, the
mutual interest, of the free nations. We share many vital economic interests with
our friends and allies. As we work together in mutuality of interest our grand
partnership can be increasingly successful.
THE TESTIMONY OF BUSINESS AND INDUSTRY IN SUPPORT OF
II._R.I
Testimony in support of H. R. I was given by many national and
regional business and industrial organizations, as well as by many trade
associations. For example the United States Chamber of Commerce
indicated approval of the proposed legislation. The statement pre-
sented on behalf of that organization stated in part as follows:
Through increased trade, the Nation's economy benefits. That is true just as
much in world trade as it is in domestic trade. More goods at tower prices has
been the very heart of the American competitive enterprise system; the trade-
agreements program can contribute to the health of that system.
11v continuing the trade-agreements program, the United States can lead from
strength-the strength of a growing, dynamic, resilient economy.
* * * I might add that the Chamber of Commerce of the United States does
not advocate a free-trade program. But the gradual and cautious approach, as
provided in H. it. 1, would be sulficieni, assurance that the United States, the
economic nerve center of the free world, would continue on the path to liberaliza-
tion of trade. This is the psychological reason why the trade-agreements program
must be continued. We need to practice what we preach.
The .research. and policy committee of the Committee for Economic
Development, a group of about 35 businessmen chosen from the 150
members of the board of trustees of CED, was represented by Howard
C. Peterson, president of the Fidelity Philadelphia Trust Co. He
testified that there were two major reasons why the committee believed
that it was in the national interest to continue the policy of gradual
and selective tariff reduction under the reciprocal trade-agreements
program.
First. Tariff reduction contributes to our national security by supporting our
foreien policy.
Second. Lower tariffs will strengthen the Nation's domestic economy.
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TRADE AGREEMENTS EXTENSION C
Mr. Warren L. Pierson, chairman. of the United States Council of the
International Chamber of Commerce, endorsed H. R. 1 and said :
There are compelling reasons based on considerations of the national security
for supporting this bill. Our whole system of military alliances is based on the
spirit and strength of the other free countries. We believe that enactment of this
bill will encourage and strengthen them.
It will do this, first, because it will demonstrate that the United States will
not turn back to economic isolationism. This will have a favorable effect on
foreign thinking which goes beyond the economic sphere.
Second, it will help other friendly nations to earn the dollars they need to
buy the goods they require and want from the United States. This will make
them stronger economically.
Third, by hastening the day when United States foreign aid will no longer be
needed, it will increase the political strength and cohesion of the free world.
Self-reliant nations who are paying their own way are the best allies.
Fourth, we believe that enactment of this bill will stimulate mutually profitable
trade and investment among the free nations and reduce the possibility of trade
disputes which could weaken the foundations of free world unity.
In his testimony Charles P. Taft, president of the Committee for a
National Trade Policy, compared the support for the trade-agreements
program today with that in 1945. He stated the groups for and
against are much the same as they were then. He said :
This distinction occasions no surprise to anybody. It is the same distinction
that existed 10 years ago, in 1945, when the only previous debate on increased
authority for the reciprocal trade agreements program took place. Then, as now,
the pottery industry, the glass industry, the organic chemical group, the glove
industry, the hatters, and others told you that the trade-agreements p ogram
would destroy there. Then, as now, the administration and the broad national
groups representing labor, industry, and the consumer, denied it, and opposed the
position of these industries. Then, as now, I stood here before this committee
and urged the continuation and expansion of the reciprocal trade-agreements
program. Many of you gentlemen behind the bench today were present then to
hear both sides of the issue.
This is one basic fact we should not lose sight of. Most Americans, including
most businessmen, are for the continued gradual reduction of our tariffs. * * *
I think it is fair to say that of those Americans who exvress an orinion, there are
twice as many for the continuation of the program as are against it.
Though the leaders on both sides of this issue have not changed much since
1945, except perhaps for a little graying at the temples, the world in which we
live has changed a great deal. Time has proved that we who spoke on our side
of the debate in 1945 were better prophets than those who opposed us. Although
our imports of goods, so greatly feared then as now, have increased from $3.9
billion in 1944 to $10.9 billion in 1953, our gross national product has in the
same period increased front 211 to 364.8 billion dollars, and our employment
to record figures. Our exports have risen again well above the wartime lend-lease
levels to $15.6 billion in 1953, and contributed substantially to our big!) employ-
ment and prosperity. If the reciprocal trade agreements program has hurt its,
it has been a hurt very well concealed.
The past president of the National Retail Dry Goods Association
testified on behalf of that organization in part as follows:
This committee may be told that the United States is a low-tariff country and
that our existing tariff levels are not high enough to keep out foreign goods. I
believe that this approach needs some qualifications and that we should not rely
solely on averages. We retailers do not deal in averages. We deal in individual
commodities and we are constantly exposed to tariff rates that prevent its from
imnort.ing some product or products that our customers want.
Mr. Morris S. Rosenthal represented the National Council of
American Importers. He testified in support of H. R. 1 saying:
Then, too, we should remember that dollars that go abroad to pay for imports
always come back to its in payment for exports, even if the flow of trade and of
money is multilateral and not bilateral. The dollars we spend abroad for imports
are not lost to its.
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* * * Also, greater imports at lower prices `would enable the consumer to
spread his purchasing power among more kinds of goods. To be able to buy some
of his needs abroad at lower prices would mean that the individual buyer could
aflord still other goods of domestic manufacture that he cannot now buy, and in
this way stimulate some of our American industries and agriculture.
The Detroit Board of Commerce in its statement indicated.:
The board's interest, in the instant proceedings springs from the great stake
that Detroit has in foreign trade.
the products of Detroit's manufacturing concerns, members of the Detroit
Board of Commerce, are seen throughout the world. Detroit-made automobiles
and tanks, and tractors, are on the streets of Zurich and Istanbul, and Detroit-
made pharmaceuticals and calculating machines, too, are in shops at Caracas and
Rio de Janeiro. In fact, we estimate that 1 out of every 7 employed in manu-
facturing in Detroit owes his living to foreign trade to a substantial degree.
Furthermore, in 1953, the port of Detroit experienced a level of international trade
which ranked it second among the ports of the United States on the dollar value of
exports and imports.
The Cleveland World Trade Association in its statement said:
* * * Cleveland carries on an annual foreign trade amounting to approximately
$500 million which is substantially more than 10 percent of its total industrial
production.
The president of the San Antonio World Trade Association testified
that:
lit 1951 exports through Texas ports amounted to $229 per capita for the popu-
lation of Texas, whereas during the same period the per capita exports for the
entire United States amounted to only $98. Thus, Texas exported over 2h times
as Inuc`t per capita as the entire Nation. During the same period, Texas per
capita imports amounted to $52. Comparing this with $229 per capita exports,
we find that Texas exported about 4 i times as much in 1951 as it imported.
Daniel W. Bell, president of the American Security & Trust Co.,
testified from the basis of his experience with the study of foreign
trade policy made by the Public 'Advisory Board for Mutual Security.
He said in part:
Ttere is much more than, will have to be done to give this country it trade and
tariff policy suited to our expanding economy. Our local and interstate commerce
would wither if it were subjected to the uncertainties and the inequities that are
constantly applied to our import trade. We need to simplify our tariff classifi-
cations; we need to modernize our customs administration. Undoubtedly, other
measures will be proposed to deal with these problems. In the meantime, there
is no better way of making progress toward a trade and tariff policy in the national
interest than to extend the Trade Agreements Act.
Mr. T. W. Hardy, Jr., vice president, Hardy Salt Co., St. Louis, Mo.,
stated that he spoke as an individual businessman interested in, the
overall effect which this legislation can have on the general climate of
business activity and prosperity. He said in part:
I emphatically do not believe, however, that there is any sacrifice of the Ameri-
can standard of living involved in this legislation. Quite the contrary. It seems
to me that we stand to gain economically by the passage of H. R. 1, and by the
increased imports resulting therefrom.
Increased imports, under the conditions of the United States trade imbalance
which has existed for over 50 years, increased imports purchased by American
business and consumers, can only result in an increase in the American standard
of living. Increased imports are the boot means of providing for expansion of
United States exports. We stand to gain by an increase in our standard of living
and, to the extent that foreign purchases are increased, by an expansion of pro-
duction.
Monroe J. Rathbone, president of Standard Oil Co. (New Jersey),
testified on the basis of his company's more than 70 years' experience
on foreign trade. He said:
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TRADE AGREEMENTS EXTENSION ACT 9
* * * The encouragement of international trade along sound lines is one of the
surest ways to promote peace and progress in the world. And we are also con-
vinced the United States cannot fail to benefit from social and economic progress
by the other nations of the free world, and by a spreading of the desire for peace
and the opportunities for progress which peace brings.
Included among other business and industry representatives expressing
support of H. R. 1 were:
Samuel Nakasian, world trade committee of the Washington
Board of Trade.
Ed P. Jackson, Jr., Louisville Foreign Trade Club.
Stacey Bender, Jr., chairman, foreign policy committee, North
Atlantic Ports Association, Inc.
Jere Patterson, International Advertising Association.
John C. White, American Cotton Shippers Association
J. T. Hutson, president, Tobacco Associates
S. Ralph.Lazrus, American Watch Association
George Morgan, Association of American Ship Owners
Benjamin Lazrus, chairman, Beni-us Watch Co.
Charles H. Percy, president, Bell & Howell Co.
A. T. Brown, executive vice president, Caterpillar Tractor Co.
Sidney A. Swensrud, chairman, Gulf Oil Corp.
Harrold W. Haigglit, president, Creole Petroleum Corp.
James W. Foley, vice president, The Texas Co.
George Donat, Parke, Davis & Co.
Henry Ralph, vice president and manager, Bank of America
International
Joseph M. Barr, president, United Aircraft Export Corp.
Charles Helin, president, Helin Tackle Co., Detroit
Rudolph S. Hecht, chairman of the board, International House
Motion Picture Association of America
American Association of Port Authorities, Inc.
Association. of Food Distributors Joint Import Council
United States Paper Exporters Council, Inc.
American Book Publishers Council
Chicago Association of Commerce and Industry
Commerce and Industry Association of New York
Houston Chamber of Commerce
Buffalo Chamber of Commerce
San Francisco Chamber of Commerce
San Francisco World Trade Association
World Trade Department
Indianapolis Chamber of Commerce
New Orleans Board of Trade
Northwest World Trade Club, Minneapolis
Norfolk Port Authority
The Council of International Relations, San Antonio
Foreign Trade Club of Galveston
Export-Im:port Club of Dallas
Fort Worth Export, Import Club
Houston World Trade Association
Hampton Roads Foreign Commerce Club, Norfolk, Va.
Richmond Export-Import Club, Galveston Wharves
Empire State Petroleum Association
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54 TRADE AGREEMENTS EXTENSION ACT OF 19515
Evansville Chamber of Commerce Foreign Trade Committee
Arkansas-Missouri Cotton Trade Association
Foreign Trade Association of Southern California
THE TESTIMONY OF AGRICULTURAL GROUPS IN SUPPORT OF I.C. R. 1
The President of the American Farm Bureau Federation, Mr. Charles
B. Shuman, testified before the committee in favor of the present bill.
The Farm Bureau, representing 1,609,461 farm family members in
48 States and Puerto Rico, has been a consistent supporter of the trade-
agreements program. Mr. Shuman said:
* * * Our wheat, cotton, tobacco, soybeans, feed grains, rice, and animal by-
products and certain fruits and other products are among the most efficiently
produced in the world. Our exports of farm products have ruts as high as $4 billion
in 1951-52. They accounted for roughly one-third of our production of wheat,
cotton, rice, and soybeans. This provided a market; for the produce of more than
I out of each to acres of cropland. This amount was equal to $1,000 for each
commercial farm. Total farm exports have dropped nearly 30 percent.
We have made great efforts to adjust our production to lower demands. Our
prices have dropped. We have imposed income-reducing production controls on
wheat, cotton, corn, peanuts, tobacco, and rice. Despite these efforts, the Gov-
ernment has accumulated over $6.5 billion worth of surpluses. Faster adjust-
ments wot Id require a regimentation on American farms which would endanger
our freedom.
We are expanding our domestic markets. We must expand our foreign
markets.
To n:taintain a prosperous agriculture, we need export markets of around
$4 billion per year at present prices. We have the capacity to supply an even
larger foreign demand.
Vie think our foreign economic policies should be geared to these export needs.
Enaetn-ent of H. R. 1 is an important step to gear up to this need.
lhre believe that H. R. 1 is a well-balanced piece of legislation. It provides not
only the authority needed to expand trade but also provides desirable safeguards
through, application of the peril-point procedures, and through continuation of
the escape clause and section 22 to protect domestic producers and the operation
of domestic farm programs from disruptive rates of increase in imports.
Another great farm organization, the National Grange, was repre-
sented by its master, Mr. Hershel D. Newsom. After endorsing the
principle of H, R. 1, Mr. Newsom said:
There is no single segment of American economy that has greater stake in
achieving the objective of a sound United States economic position and policy,
which would provide the basis for a constantly expanded level of trade in. the
world on a profitable basis, than has American agriculture. * * *
There are likewise compelling reasons for our looking with great concern on any
attempt that might be made to recklessly or inconsiderately remove some of our
restrictions that we believe have been literally compelled by circumstances beyond
our control.
The vast majority of farm people, as we know them and understand them, are
thoroughly cognizant that our most important market is this market--right here
in America. We are for the most part equally aware of the fact that unless we
can market some 10 or 12 percent of our total agricultural output-and I assume
that practically all members of the committee know that it runs up to a third of
the total production or even a little higher than that under present circum-
stances--and then effectively balance our output as between agricultural com-
modities themselves, there is no effective recipe for the high level of agricultural
income that we believe is essential to the expanding American economy that must
be our total objective.
James G. Patton, president, the National Farmers Union, endorsed
the bill stating in part:
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TRADE AGREEMENTS EXTENSION ACT OF 1955
Many of us produce products which have traditionally entered into export
trade, like cotton, wheat, tobacco, hogs, and certain fruits. We know that the
export market for these crops is important to us and that. it depends on low-trade
barriers abroad, on prosperity and buying power in foreign countries, and espe-
cially on foreigners' supplies of dollars. We know that foreigners can obtain
dollars chiefly by selling goods and services to citizens of the United States and that
the amount they can sell depends in part on how much we are willing to buy.
About one-ninth of total faun production is exported; imports of farm commod-
ities of a type produced in this country were equivalent to approximately one-
sixteenth of total United States farm production. The value of farm exports
from the United States was almost twice as great as the value of competing farm
imports.
Exports.-However, this simple comparison does not tell the whole story by any
means. The direct effect of agricultural imports and exports on the economic
situation of individual farm families varies a very great deal according to the
commodities produced for sale. Exports make tip a very large part of the market
for some farm products; in 1953, 45 percent of United States rice was exported;
24 percent of our cotton; 19 percent of our wheat and flour; 17 percent of barley;
26 percent of tobacco; and 21 percent of soybeans and products; 18 percent of
lard; 6 percent of our raisins; and about 5 percent of pears and apples; with some-
what smaller percentages of other commodities produced on United States farms.
Mr. J. B. Hutson, president of Tobacco Associates, Inc., represented
before the committee the producers, warehousemen, and exporters of
flue-cured tobacco, and the merchants, bankers, and fertilizer dealers
in the flue-cured-tobacco-producing areas of Virginia, North and
South Carolina, Georgia, Florida, and Alabama. Mr. Hutson
recommended the enactment of legislation extending the Reciprocal
Trade Agreements Act and stated:
* * * About one-fourth of all tobacco grown in the United States is exported.
In the case of many types of tobacco, a substantial part of the crop is suitable only
for the export trade.
* * * We do not believe that there is enough recognition of the interests of
the large segments of our population who are engaged in the production of articles
which are exported. We believe that the interests of these groups, and especially
those of our own consumers, should be given just as much consideration as is
given the individual groups who might be adversely affected by the imports.
In fact, all the studies I have seen point to the conclusion that the stake that the
American economy-agriculture, industry, labor, the consumer-h.as in sustained
and increased exports, far exceeds the possible adverse effects of increased imports.
THE TESTIMONY OF LABOR IN SUPPORT OF H. R. 1
Mr. James B. Carey, secretary-treasurer, Congress of Industrial
Organizations, appeared before the committee on behalf of the
approximately 5 million workers of that organization. Following are
several direct quotations from Mr. Carey's statement:
* * * many of our industries are dependent for survival upon the exports of
reasonable amounts of their own production.
Many workers in key industries, such as auto, steel, electrical products,
and machinery are dependent for their jobs on the exports of products manufac-
tured in their plants.
* * * In 1952, 13 percent of agricultural machinery production went abroad,
23.3 percent of the tractors produced were exported; 13.3 percent of the motor-
trucks, 3.9 percent of the passenger cars, 6.3 percent of the rolled-steel products
of the United States went to other nations of the world. During that year, over
2 million workers were totally dependent upon exports for their jobs, and the
industries involved were dependent upon exports for a considerable percentage
of their sales and profits. The latest available estimate shows that 7 percent of
the employees in nonagricultural establishments of the. United States were de-
pendent on exports for employment in 1952.
* * * * * * *
The United States cannot pick and choose and deal only in the items that we
need to import and export. Instead, the United States must engage in gradual,
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56 TRADE AGREEMENTS EXTENSION ACT OF 1955
continual, and, in many instances, reciprocal reduction of the barriers to inter-
national trade. Reciprocal trade is essential for the maintenance of production
in many of our own basic industries and equally essential for the preservation of
sound international relations with our allies. Improved economic well-being of
the countries throughout the world is one means by which Communist; aggression
can be stopped. Economic well-being and improved international trade relations
go land in hand.
For taese reasons we are happy to support 11. R. 1, which will extend and con-
tinue the Hull reciprocal trade program.
* * * * * * *
With the adoption of H. R. 1, problems will develop for some American workers
in certain industries and communities. But let me make our position perfectly
clear. We do not oppose a liberalized trade program, because injury or threat of
injury may affect certain segments of American production. On the contrary,
we ;;ay, "Alleviate the injury or threat of injury by some method other than
increasing the duty. Don't, cut off your nose to spite your face." * * *
* * * We are proud of the CIO slogan, "What's good for America is good for
the CIO." We are convinced that the promotion of international tirade is good
for America and, therefore, good for the C10.
The American Federation of Labor, representing more than 10 million
workers, in a statement supporting II. R. 1 stated:
11 e are mindful of the fact that a significant number of American workers are
employed in industries facing foreign competition. We are definitely concerned'
lest the trade-agreements program operate to deprive these workers of employment
opportunities at their present trade or occupation.
Al-, the same time, we are equally mindful that many American workers are
dependent for their employment on American exports or on the handling, trans-
portation, or storage of imports. In 1952, the Bureau of Labor Statistics estimated
that the employment of 4,376,000 American workers depended on foreign trade.
In ocher words, these are the workers whose employment depends on the ability of
other countries to continue to buy American products.
The A. F. of L. expressed itself in favor of the gradual approach
toward tariff reduction:
The American Federation of Labor does not endorse either the extreme position
of free trade or the extreme position of protection. We believe that trade policy
can Drove a useful tool for reducing the dollar gap, for persuading other countries
to lift their trade restrictions, and in general for strengthening the economic basis
of the free world. We believe that to achieve these objectives, this country should
continue: its policy of negotiating tariff adjustments, to use the President's phrase,,
"on a gradual, selective, and reciprocal basis." The importance of the terms
"gradual" and "selective" must be emphasized * * *.
W4 e believe that if the adjustments negotiated under this proposed program
are, to use the President's words, "gradual, selective, and reciprocal," they need
not operate to curtail employment opportunities for American workers.
The A. F. of L. recommended that promptness be exercised in giving
relief where relief is justified, and recommended:
We suggest therefore that the time required for handling applications under the
escape clause be shortened. We recommend that the 9-month requirement be
reduced to 120 days and that the 60-day requirement for the handling of cases
by the White House be reduced to'30 days.
This will greatly improve the operations under the present escape clause.
Because industries will know that their applications will be processed more
promptly, they are less likely to run to the Tariff Commission if the evidence
does not justify relief. The net result will be a far more effective method of pro-
viding relief to those groups who may be suffering serious injury under a particular
tariff.
Th.e president of the United Steelworkers of America, Mr. David J.
McDonald, appeared before the committee in support of the present
bill. He spoke on behalf of more than 1,200,000 workers in the basic
steel-producing, the metal-fabricating, aluminum- and metal-mining
industries in the United States and Canada. After stating that pas-
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sage of the bill is essential to the security of the United States, Mr.
McDonald said that-
It is, of course, essential that the United States keep its own economic house in
order, that the American economy be kept strong, employment must be kept at a
high level, and the living standards of our people be steadily raised. I am of the
opinion that expanding our foreign trade will assist rather than hinder the attain-
ment of these objectives.
To carry out such policies is enlightened self-interest. If I had the slightest
feeling that increased trade, particularly imports, would be injurious to the
American workingmen, I would not be here today supporting a policy of trade
liberalization. It is precisely because I believe that it is in the interest of the
American workers and our people generally, that I am happy to continue to
support a liberal trade policy at this critical juncture of American history.
The best figures that we could get indicate that employment attributable to
exports is far greater than the immediate displacement of workers that, would
result by even a substantial reduction of our tariff duties. Secretary of Commerce
Sinclair Weeks, in his testimony in connection with the Trade Agreement Exten-
sion Act of 1953, and which he repeated again the other day in his testimony
before this committee, stated that over 4.4 million workers, or 7 percent of the
total employment of the country, are dependent upon foreign trade.
He estimated that 3 million workers are involved in exports while inure than a
million more have employment in transporting, distributing, and manufacturing
imports. Other reliable estimates indicate that in the iron. and steel industry,
the industry in which I am directly concerned, close to 160,000 workers, or almost
17 percent of the 965,000 workers in the industry, are dependent upon exports.
The most reliable estimates that we could find, indicate that even a full 50-
percent reduction of all United States tariffs would not likely affect more than
100,000 jobs. This is the effect that could be expected in the short, run. As
time passes and economic adjustments take place, many of these workers would
be absorbed in other lines of activity. This is not to say that worker,: displaced
by imports should be left to their own devices to find new jobs. Both the short
run and the long run are important. These estimates simply underline the basic
truth that, the American workers have more to lose from the curtailment of ex-
ports than from the expansion of foreign trade.
Mr. Hartman Barber, representing the Brotherhood of Railway
Clerks, expressed the continued support by his organization of the
reciprocal trade agreements program. Mr. Barber stated:
There is a tendency among some, Americans to consider our forei,,,n trade as
relatively unimportant. The facts point to the opposite conclusion. Our
prosperity is greatly affected by our foreign trade. Our Nation is now the world's
principal foreign trading country. The reduction in the sales of sonic companies
by the amount of their foreign trade would mean the difference between a profit
and loss.
Exports take a quarter or even a half of the total United States production of
some commodities. In the year preceding the outbreak of the Second World War,
the exports of our Nation furnished a market, for 12 percent of our lard, 12 percent
of our radios, 11 percent of our automobiles, 14 percent of our industrial ma-
chinery, 22 percent of our office appliances, 29 percent of our tobacco, 29 percent
of our sardines, 31 percent of our cotton, 36 percent of our dried fruit, 36 percent of
our sulfur, 38 percent of our rosin, and 52 percent of our production of phosphate
rock. Soe of these commodities are produced only in certain relatively small
areas. In such cases, if exports were to decline there would be a concentrated
effect upon the areas where they are produced.
Since the close of the Second World War, the goods we exported exceeded the
value we imported by several billion dollars each year. We cannot continue to
export, of course, unless we are willing to receive goods in exchange for i he products
we sell abroad.
A large number of our citizens earn their livelihood in occupations directly
attributable to foreign trade. In the transportation industry, the industry in
which the members of the Brotherhood of Railway Clerks are employed approxi-
mately 10 percent of the employment is so attributable.
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GREMENTS, EXTENSION ACT OF 195,15
THE TESTIMONY OF PUBLIC-INTEREST GROUPS
As in the past when extension of the Trade Agreements Act has been
considered by the committee, representatives of some of the most
important public
the c liegisnterestlatigonroups in
in support of the Nation appeared and testified
legislation. Mrs. A. Paul Hartz, chairman of legislation for the General Federa-
tion of Women's Clubs, with a membership of 5% million, testified this
year in support of H. R. 1.
A representative of the Cooperative League of the LISA appeared
before the committee on behalf of most of the consumer cooperatives
of the country both rural and urban, some of the major farm supply
cooperatives, two of the mutual. insurance groups and a number.of
other organizations. The direct membership of the league is about
2,500,000 families. The statement of the league emphasized the fact
that it "represents both producers and consumers" and pointed out
that they thought it was to their benefit-
and indeed, to the benefit of all Americans, that the Reciprocal Trade Agreements
Act should be extended.
It has often been said that the consumer is the forgotten man. Other interests,
farrr.ers, electric power companies, manufacturers, bankers, all have their spokes-
men here in Washington. Whenever ('ongress writes a bill, these spokesmen
present their points of view to the legislators. Yet all of us are consumers,
whether we own a farm as I do in Ohio, or make watches, or run powerplants:
no matter what we do for a living, the money we get or income is spent at least
in part on goods and services.
If there can be said to be such a thing as a general interest, it is the interest of
the American as a consumer. The manufacturer of watch moiements may have
a diametrically opposite interest to the assembler of watches who imports his
movements from Switzerland. The textile manufactu er may have a direct
conflict in interest, with the exporter of heavy machinery. Yet all Americans
however they make their living, have an interest in plentiful food, abundant goods,
arid low prices.
The League of Women Voters, which consists of 126,000 members in
960 local leagues in all 48 States, Alaska, Hawaii, and the District of
Columbia, was represented by Mrs. Oscar M. Rubenhausen. She
characterized the President's proposal as a moderate one, but stated
that "as a results of its passage the United States and other nations
should he able to progress in their negotiations toward the goal of
expanding world trade."
Dr. Alzada Comstock testified in support of IT. R. 1 on behalf of
the American Association of University Women, an organization of
women college graduates with a membership of more than 131,000
women in the 48 States, Hawaii, Guam, and Alaska. She stated that:
'Che association believes that through the years the reciprocal trade agreements
program has served the interests of the American people and has strengthened
international relations (1) by promoting the expansion of world trade, (2) by
providing machinery through which this Nation and other nations could seek
their mutual advantage through the exchange of goods, and (3) by providing
for the consideration of all American interests-consumers, producers, and export-
ing industries as well as industries in competition with foreign goods in the
United States market.
Among other public interest organizations which had representatives
expressing support of the bill were:
The American Veterans Committee
The Jewish War Veterans of the United States of America
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The Friends' Committee on National Legislation
The Americans for Democratic Action
The Council on international Relations of San Antonio, Tex.
The Committee on Foreign Trade Education, Inc.
OVERWHELMING PRESS SUPPORT OF K. R.' 1
The press throughout the country has shown increasing interest in
the renewal of the Trade Agreements Act during the past year. Edi-
torial comment has been overwhelming y in favor of the trade-agree-
ments program and a substantial majority of those newspapers which
have taken a position, support the pending legislation. Editorial
writers emphasize that the program is essential to healthy international
economic conditions, the maintenance of free world strength, and
domestic prosperity.
Boston Herald, January 11, 1955:
The President's program should be adopted at the present session of Congress.
We have been fencing with. the inevitable long enough.
Buffalo Courier-Express, January 11, 1955:
President Eisenhower's proposal is in line with the thinking not only of enlight-.
ened American political leaders of both parties, but also of outstanding spokesmen
of business and industry. America's position as 20th century leader of the free
world would be impaired * * * by retreat into 19th century high-tariff policies.
Charleston (S. C.) News and Courier, January 13, 1955:
We agree with Mr. Eisenhower that tariffs should be lowered.
Chicago Sun-Times, January 11, 1955:
President Eisenhower's special message * * * outlines a sane and sensible
program that deserves the full support of Congress.
Christian Science Monitor, January 11, 1955:
In our opinion, this all acids up to a useful program.
Dallas News, January 11, 1955:
The President is right in asserting that what he is proposing is less in the
interests of aid for foreign trade than of aid for the United States.
Dayton News, January 11, 1955:
Fortunately, the political omens are favorable for enactment of the program.
Denver Post, January 11, 1.955:
Modest as Mr. Eisenhower's program is, it has great potentials--for American
business, for American agriculture * * * for those countries which are not
adverse to encouraging investments by American companies.
Des Moines Register, January 12, 1955:,
These are very modest and very moderate proposals toward carrying out such a
policy (President's stated goals). Let us hope that they are not weakened further.
Detroit News, January 19, 1955:
The administration has not asked for a drastic reduction in import duties. It
has asked for a stable and rational trade policy.
Garden City Newsday, January 3, 1955:
The President Hoist not retreat before opposition this year as he did last year.
His program is sound. He must fight until he wins.
Great Falls (Mont.) Tribune, January 19, 1955:
There is little reason for a partisan fight over this program.
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Hartford Courant, January 11, 1955:
Put by and large for every domestic producer that is hurt by trade there are a
vast number who are benefited, as is the public generally.
Houston Post, January 12, 1955
Taken together, all of the proposals, if enacted, should result in good for the
United States and all other participatin;; countries.
Kansas City, Times, January 11, 1955:
The broad foreign economic program which President Eisenhower submitted
yesterday in a special message to Congress is geared at three levels to our own
national self-interest * * * It looks like an attractive package.
Louisville Courier-Journal, January 12, 1955:
President Eisenhower has always made uncommonly sound sense on the foreign
trade issue. He has done it again with his latest message to Congress.
!Milwaukee Journal, January 11, 1955:
The President is correct in terming his program "'moderate, gradual, and
reciprocal."
Newark News, January 11, 1955:
As Clarence B. Randall * * * told the Congress of American Industry last
month, "a tariff that cuts imports is a tariff that cuts exports."
New Orleans Times-Picayune, January 12, 1955:
N] r. Eisenhower's program seems to be well devised to stress the advantages
of two-way trade.
New York Herald Tribune, January 12, 1955:
It (President's message) states the case for promptly taking those legislative
steps in the fields of foreign trade and investment that will contribute to a
strengthening of the economic base upon which security must rest.
New York Journal of Commerce, January 25, 1955:
The tariff-reduction provisions of this measure are quite mild, and the record
of Mr. Eisenhower's first 2 years in the White House indicates that when he
uses them at all he will use them with restraint.
New York T),mes, January 11, 1955:
They (President's proposals) really represent the minimum for an. intelligible
and intelligent foreign-trade policy.
New York World-Telegram and Sun, January 11, 1955:
President Eisenhower's message to Congress on foreign economic policy is
sound and wise. Its proposals are moderate, yet taken together they can con-
tributo greatly to our own prosperity and ghat of our allies and the underdeveloped
areas of the free world.
Philadelphia Inquirer, January 11, 1955:
The time has come for Congress to vote the longer (than 1 year) program as
evidence of our intention to help other countries--and ourselves--by expanding
foreign trade.
Providence Journal, January 11, 1 955 :
For our own national welfare, we must have a trade program as broad and
multipurpose in scope as Mr. Eisenhower has proposed. And it must have
continuity.
St. Louis Post-Dispatch, January 11, 1955:
President, Eisenhower's splendid message to Congress on foreign economic
policy makes eminently good sense, as did the similar proposals when he first
made them a year ago.
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Salt Lake City Deseret News d Telegram, January 11, 1955:
If we recognize America's position in world affairs-and we cannot escape doing
so-we must agree with the basis of the President's program.
San Antonio Express, January 11, 1955:
It follows that what President Eisenhower now seeks of Congress, in effect, is
that it untie his hands so that he can wield a vital economic weapon, "trade, not
aid," for the Nation's defense. He can be trusted to use the weapon discreetly
* * * for moral effect Congress should act speedily.
Toledo Blade, January 12, 1955:
Overall, the President's world trade message reflects midcentury facts the
Nation cannot afford to overlook.
Washington Post and Times-Herald, January 11, 1955:
Approval of the program will mark an important step toward freer trade that
should not be discounted just because it leaves much to be done.
Watertown (N. Y.) Times, January 10, 1955:
President Eisenhower takes the international long view on foreign trade, a
view that his party should take, but a view that his party has failed to take in
many years.
Youngstown Vindicator, January 10, 1955:
The requests are moderate enough, and American industries have the added
protection of the existing peril point and escape clauses which the President would
continue.
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APPENDIX C
ACCOMPLISHMENTS OF THE TRADE AGREEMENTS PROGRAM
The record of accomplishment under the Trade Agreements Act is
one of continuous and increasing contributions to the expansion of the
American economy and levels of world trade. Under the act the
United States now has trade-agreement relationships with 42 coun-
tries. Ten of these are bilateral agreements. The other 32 have
been negotiated under the auspices of the General Agreement on
Tariffs and Trade (GATT). Some of the negotiations conducted
under the GATT replace former bilateral agreements. Following is
the list of countries with which the United States has trade agreements:
Country
Date con-
eluded
Date effcc.
tive
Country
Date con.
eluded
Date effec-
tive
Argentina___________
Oct. 14,1941
Nov. 15,1941
Iceland______________
Aug. 27, 1943
Nov. 19
194
Australial__________
Oct. 30,1947
Jan. 1,1948
India l----------------
Oct. 30,1947
,
July 9, 194
Austrial------------
'
Apr. 21,1951
Oct. 19,1951
Indonesia l__________
----- do___.____
Mar. 11
194
3elgian, 2___________
Oct. 30,1947
Jan. 1,1948
Iran_________________
Apr. 8,1943
,
June 28
194
:i3razil2--------------
----- do--------
July 31,1948
Italy 1---------------
Oct. 10. 1949
,
195
M ay 30,
]3urmal_------------
----- do--------
July 30,1948
Luxembourg 2_------
Oct. 30,
Jan
1,194
.
s_,ana9a2------------
----- do--------
Jan. 1,1948
Netherlands 12______
-----do--------
Do
.
Ceylon
I ----- --------
----- d?--------
July 30,1948
New Zealand 1---?--
----- d?-__-----
July 31, 194
Chile 1______________
_____do________
Mar. 16,1949
Nicaragua 12--------
Oct. 10.1949
May 28, 95
1
Cuba1%-------------
----- do--------
Jan. 1,1948
Norwayl____________
Oct. 30,1947
July 11
194
Delmlarkl__________
Oct. 10,1949
May 28,1'950
Pakistan l-----------
----- do________
,
July 31, 194
Dominican Repub-
Paraguay____________
Sept. 12,1946
Apr. 9,194
lieL____.__________
_____do__--____
May 19,1350
Peru 12___________-__
Apr. 21,1951
Oct. 7
195
licuador2____________
Aug. 6,1938
Oct. 23,1)38
Southern Rhodesia 1-
Oct. 30?1947
,
July 12
194
141 Salvador_________
Feb. 19,1937
May 31,1937
Sweden 12___________
Oct:. 10,.1949
,
Apr. 30, 195
Finlaad12_-_________
Oct. 10,1949
May 25,1950
Switzerland_________
Jan. 9..1936
Feb. 15
1931
France 1 2________ _
Oct. 30,1947
Jan. 1,1948
Turkey 1 2_______
Apr. 21, 1951
,
Cot. 17,195
,
,lermany 1 _-________
Apr. 21,1951
Oct. 1,1951
Union of South
Ilreece l_____________
Oct. 10,1949
Mar. 9,1950
Africa l__-_-__
Oct. 30,.1947
June 14
Guatemala____
Apr. 24,1936
Juno 15,1936
United Kingdom 1 2_
_ do________
Jan. 1,194
1fait!12_____________
Oct. 10,1049
Jan. 1,11150
Uruguay12__________
Oct. 10,1949
Dec. 16
195
1londuras___________
Dec. 18,1935
Mar. 2,1936
Venezuela___________
Nov. 6,1939
,
Dee. 16,193
1 Agreement concluded under auspices of General Agreement on Tariffs and Trade.
2 Replaced bilateral agreement with United States.
2 To be terminated on July 18, 1955.
The following table demonstrates the expansion of United States
trade with trade-agreement countries. As is shown :in the table,
trade with countries with which the United States has trade agree-
ments had in some cases expanded between 1937 and 1953 by more
than 1,000 percent. While this expansion in our export trade is not
clue exclusively to concessions obtained by the United States in. trade
ftgreements, they have nevertheless made a substantial contribution
to this expansion through the more favorable customs treatment
obtained for our goods. The most dramatic case, although the value
of the total trade is not large, is trade with Iceland, which has ex-
panded more than 7,000 percent since 1937.
After 1945 most of the world's economies had been seriously dis-
located by the war and many countries were forced to adopt special
measures to restrict imports, particularly from the United States,
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since there was a worldwide shortage of dollars. This shortage is
now less acute and balance-of-payment restrictions have been con-
siderably reduced and modified by most of the countries.
Estimated value of United States exports in 1937 and 1953 to countries with which
trade agreements are now in effect
[Thousands of dollars]
1937
1953
Percent
Country
Total
Export of
Total
Export of
increase
1937 to
1953
United
States
concession
United
States
concession
total
exports
items 1
exports
items i
exports
Argentina- .---------------------------------
93,&31
44,100
104,100
48,927
10.9
Australia____________________________________
73,300
44,750
134,300
81,923
83.0
Austria______________________________________
3,002
080
60,200
19,264
1,866.0
Benelux and dependencies___________________
245,394
234,832
630,700
603,580
157.0
Brazil_______________________________________
68,271
36,866
293,900
158,706
330.5
Burma--------------------------------------
(2)
------------
6,800
2,788
_ _ _
491,489
353,872
2,941,100
2,117, 592
498.4
Ceylon______________________________________
1,718
807
7,100
3,337
313.3
ChilG---------------------------------------
23,742
14,957
07,600
61,488
311. 1
Cuba_____________ ----------------------------------------
90,700
87,130
425,200
408,192
368. 5
Denmark____________________________________
17,150
6,003
38,300
13,405
123.3
Dominican Republic________________________
6,371
1,911
47,000
14,100
637. 7
Ecuador ________________________________..___
5,004
2,102
41,300
17,346
725.3
El Salvador_________________________________
3,593
431
37,000
4,440
9`7,9.8
Finland-__ _________________
12,243
3,918
22,100
7,072
80.5
France and dependencies ---- ________________.
174,135
152,194
392,500
343,045
125.4
?ermany____________________________________
122,993
92,245
348,200
261,150
183.1
Greece _____________________________________
5,829
1,574
50,100
13,527
759.5
Guatemala ----------------------------------
7,397
1,997
44,300
11,961
498. 9
Haiti ----------------------------------------
4,025
604
28,900
4,320
615.5
Honduras___________________________________
5,492
989
35,500
6,390
546.4
Iceland______________________________________
174
60
13,300
3,857
7,543.7
India and Pakistan__________________________
843,649
41511 300
e 98,100
72,326
( 8)
________ -
103,999
51999
315 9
Iran-_____ _________________________
5,456
4,528
21,400
17,762
292.2
Italy_ _____________________________________
75,775
40,919
280,900
151,686
270.7
New Zealand_____________________ ___________
23,824
15,486
31,400
20,410
31.8
Nicaragua____________________ ________________
3, 203
955
25,900
7,511
686.5
Norway -------------------------------------
21,914
9,884
64,600
29,070
194. 1
Paraguay------------------------------------
742
430
7,100
4,118
856.9
Peru ___ ___________________________
18,883
9,442
118,600
59,300
,
628.1
Southern Rhodesia__________________________
(7)
4,600
2
898
----------
Sweden --------------------------------------
64,317
21,225
101,700
33,561
58.1
Switzerland_________________________________
9,411
4,706
131, 200
65, 600
1, 294. 1
Turkey________ __________________________
14,856
8,982
64,500
30,315
334. 2
Union of South Africa ------------------------
88,292
46, 795
206,600
109,498
133. 9
United Kingdom and dependencies----------
679,424
403,859
698,100
486,576
205
Uruguay____________________________________
13,1()5
3,407
24,500
6,370
86.9
Venezuela___________________________________
46,229
15,256
510,800
168,564
1,004.9
I Estimated figure derived from applying to total exports in 1937 and 1953, 1949 ratio of exports under
trade agreements concession to total exports.
8 Included in Burma and India.
8 British India includes Burma.
4 India.
8 Pakistan.
8 Included in Benelux and dependencies.
8 Included in other British South Africa.
Concessions obtained by the United States in its negotiations under
the Trade Agreements Act have extended to every segment of the
United States economy. The Torquay negotiations, conducted under
the auspices of the General Agreement on Tariffs and Trade at which
the United States negotiated with 17 countries, illustrate the range
of concessions that the United States has obtained. At that con-
ference, which is just 1 of 3 major conferences at which the limited
States has obtained concessions, we obtained concessions on an esti-
mated $1,100 million of our exports in 1949 to the 17 countries with
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which the United States concluded agreements. The concessions
obtained include those on agricultural products and foodstuffs such as
wheat, flour, corn, oil seeds, vegetable oils, cotton, and tobacco; fresh,
dried, and canned fruit; fruit juices, nuts, canned and dried vegetables,
soups, lard, pork, canned and salted meats, canned and powdered
milk, cheese, dried eggs, confectionery, canned fish, and prepared food
,,pecialties.
In the machinery field the more important lines for which we
obtained concessions were: many types of industrial machinery;
automotive vehicles and products, including passenger cars, trucks,
trahers, industrial lift trucks, tractors, mining locomotives, and auto-
mobile parts and accessories; machine tools and metal-working ma-
chin ery; mining machinery; earth-moving equipment; air compressors
and pumps; pneumatic tools; printing presses and other equipment
for the graphic arts; and agricultural machinery and implements.
Other concessions were obtained on many kinds of electrical
machines, equipment, and appliances, including refrigerating and
air-conditioning machinery, radio and television receiving and trans-
mitting apparatus, motors, generators, and transformers; ignition
systems; household appliances, such as washing machines, irons,
heating devices, and lighting fixtures and equipment; X-ray apparatus,
batteries, electronic tubes, and incandescent light bulbs.
Numerous concessions were obtained on chemical, pharmaceutical
and medicinal products; rubber goods, including tires, tubes, hose,
belting and packing; petroleum products, including lubricants,
petrolatum and paraffin; naval stores, including rosin and turpentine;
glass manufactures, including bottles, jars, and specialties; leather
and numerous leather manufactures; various kinds of lumber, ply-
wood, paper and paper products; numerous manufactures of iron and
:steel including tinplate, boilers, tanks; and bathroom fixtures; coal,
coke, sulfur and borax; asbestos manufactures; abrasives, including
paper, cloth and stones; and other typical United States export
specialties such as office machines and appliances, motion pictures,
film, cameras and projection apparatus, handtools, phonographs,
fountain pens, safety razors and blades, metal office furniture, nylon
hosiery, toilet preparations; and paints and varnish.
UNITED STATES EXPORTS OF PRODUCTS SUBJECT TO
TRADE AGREEMENT CONCESSIONS
The following survey gives some examples of commodities on which
the United States obtained tariff concessions from foreign countries
under the trade-agreements program and in which United: States
0xports to those countries have increased. It also gives examples of
concession items which have been freed of quota restrictions in cases
of countries whose balance of payments situation has improved enough
to make it possible for them to reduce their controls over imports.
The statistics used for this compilation are United States export
statistics.
UNITED STATES EXPORTS To AUSTRALIA OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Australia increased from $73,360,000 in 1937
to $134,300,000 in 1953, an overall increase of 83 percent.
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Approximately 61 percent of United States exports to Australia are covered
by tariff concessions which the United States obtained from that country under
the trade-agreements program. Some examples of concession items in which
trade has increased are as follows:
Cotton semimanufactures---------------------------------------------------
$17, 000
Cotton manufacture --------------------------------------------------------
115,000
Synthetic fibers and manufactures-------------------------------------------
14.000
Sawmill products
--------------------------------------------------------
1, 035, 000
----
Electrical machinery and appliances-----------------------------------------
2,228,000
Office machines and appliances ----------------------------------------------
1,033,000
$182,000
154,000
851,000
4,022,000
6,274,000
1,675,000
UNITED STATES EXPORTS TO AUSTRIA OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Austria increased from $3,062,000 in 1937 to
$60,200,000 in 1953, an overall increase of 1,866 percent.
Approximately 32 percent of United States exports to Austria are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
has increased are as follows:
Prunes---------------------------------------------------------------------
Canned peaches --------------------------------------------------------
Raw cotton- -------- - _ -- ------- ---- ----------------------------
Tires-----------------------------------------------------------------------
$7,000
0
36,000
44, 000
$114, 000
4,000
12, 465, 000
87, 000
UNITED STATES EXPORTS TO BENELUX OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Benelux and its dependencies increased from
$245,384,000 in 1937 to $630,700,000 in 1953, an overall increase of 157 percent.'
Approximately 96 percent of United States exports to Benelux are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
has increased are as follows:
J
United States exports
Commodity I
Oranges and tangerines------------------------------------------------------
Raisins---------------------------------------------------------------------
Cottonseed oil cake ------------------------------------------- ---------------
Leaftobacco--------------------- --------- -------------------------- -------
Rawcotton ---------------------------------------------------------
$14, 000
916,000
0
4,514,000
19,219,000
$5, 911, 000
998,000
227, 000
21, 704, 000
21, 430, 000
In 1954, 83 percent of the total value of Benelux imports from the United States
entered free of restrictions. The items permitted free entry and on which the
United States had received concessions, were within the following commodity
classifications:
Fruits Leather, rubber, and paper products
Vegetable oils Textiles
Processed food items Metal manufactures
Minerals and manufactures of chemicals Machinery
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UNITED STATES EXPORTS TO BRAZIL OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Brazil increased from $68,271,000 in 1.937 to
$203,900,000 in 1953, an overall increase of 331 percent.
Approximately 54 percent of United States exports to Brazil are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
Transformers
$313, 000
$2
029
000
Radio tubes
194, 00[1
,
,
536,000
Coal-tar dyes-------------------------------------- -------------------------
168, 030
754, 000
Electrom,edical and olectrodental equipment ---------------------------------
234
430
3
152
000
Transfor.mer oil ---------------------------------------------------------
,
57,0)0
,
,
310, 000
UNITE]) STATES EXPORTS TO BURMA OF PRODUCTS SUBJECT TO TRADE AGREEMENT
CONCESSIONS
7"otal United States exports to Burma increased from $2,714,000 in 193&-39 1
to $6,800,000 ir.. 1953, an overall increase of 151 percent.
Approximately 41 percent of United States exports to Burma are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
has increased are as follows:
Radios and parts -----------------------------------------------------------
Puniping machinery, hand pumps and parts ------------ ----------..--------
United States exports
$28,000
0
$236, 000
30,000
UNITED STATES EXPORTS TO CANADA OF PRODUCTS SUBJECT TO TRADE AGREEMENT
CONCESSIONS
Total United States exports to Canada increased from $491,489,000 in 1937
to $2.9 billion in. 1953, an overall increase of 498 percent.
Approximately 72 percent of United States exports to Canada are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
has inc:reased are as follows:
1 1937 statistics not available.
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Fresh fruit:
Oranges----------------------------------------
$7,200,000
$19,700,000
Grapefruit---------------------- ------------------
1,300,000
i, 300, 000
Other fresh fruit --------------------
5,000,000
I,;, 600, 000
Fruit juice .------------------------------------------------------------------
700,000
11,400,000
Rosins (dried)---------------------------------------------------------------
400,000
2,900, 000
Plums and prunes, dried---------------------------------------------------
800,000
2, 30Q, 000
Vegetables, fresh and frozen _____________________________________-___________
4,300,000
25, 800, 000
Corn-----------------------------------------------------------------------
1,100,000
9,600,000
Rice, paddy (rough)---------------------------------------------------------
100,000
3,20Q,000
Tobacco---------------------------------------------------------------------
1,200,000
2,100, 000
Coal, anthracite -------------------------------------------------------------
14, 700, 000
50, 5001000
other
Coal
----------------------------------------------------------
44, 000, 000
157, 900,000
,
--------
Clothing, cotton-------------------------------------------------------------
400,000
;:'&)Q'000
Shoes, boots, etc-----------------------------------------------------------`
800,000
4,400,000
office, store, of wood and other____________________________
house
Furniture
800'000
S, 3()0'000
,
,
Refrigeration apparatus.----------------------------------------------------
2,600,000
35, 600,000
Business machines: typewriters, adding, bookkeeping, and calculating
machines and parts----------------------------------------------------
2, 300, 000
6,200,000
Apparatus for cooking and heating: coal, wood, oil, gas, electric -------------
1,300,000
22,700,000
Olass sheet, plate, demijohns, carboy machine-mado tumblers, etc. ________
2,400,000
it,, 500, 000
Machinery: all types, composed wholly or in part of iron or steel, not other-
wise provided for, and complete parts_____________________________________
38,000, 000
125, 000, 000
Parts of automobiles, trucks, buses__________________________________________
52,000,000
230, 000, 000
Iron and steel manufactures-------------------------------------------------
19,600,000
60,000,000
Canada does not maintain quantitative import restrictions for balance-of-
payments reasons. However, the Canadian tariff embodies prohibitions, on a
few special categories of goods. Quantitatively these have very little effect on
United States export trade with Canada.
UNITED STATES EXPORTS TO CEYLON OF PRODUCTS SUBJECT TO TRADE AGREEMENT
CONCESSIONS
Total United States exports to Ceylon increased from $1,718,000 in 1937 to
$7,100,000 in 1953, an overall increase of 313 percent.
Approximately 47 percent of United States exports to Ceylon are covered by
tariff concessions which the United States obtained from that country under the
trade-agreements program. Some examples of concession items in which trade
has increased are as follows:
Fresh apples ----------------------------------------------------------------
$17,000
$27,000
Fresh grapes----------------------------------------------------------------
42,000
fib, 000
Leaf tobacco-----------------------------------------------------------------
302,000
850,000
Typewriters-----------------------------------------------------------------
22,000
32,000
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 Approved For Release : CIA-RDP59-00224A000100310002-9
UNITED STATES EXPORTS TO CHILE OF PRODUCTS SUBJECT To TRADE
AGREEMENT CONCESSIONS
Total United States exports to Chile increased from $23,742,000 in 1.937 to
$97,600,000 in 1953, an overall increase of 311 percent.
Approximately 63 percent of United States exports to Chile are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
has increased are as follows:
Typewriters----------------------- ----------------- ---------------------
$129, 000
Tractors-
151,000
Oveisize tires (excluding trucks and buses) ----------------------------------
2, 000
-Whisky ----------------------------------------- ---------------------------
0
has increased are as follows:
$226, 000
2,422,000
200,000
5,000
UNITED STATES EXPORTS TO CUBA OF PRODUCTS SUBJECT TO TRADE AGREEMENT
CONCESSIONS
Total United States exports to Cuba increased from $90,760,000 in 1.937 to
$425,200,000 in 1953, an overall increase of 369 percent.
Approximately 96 percent of United States exports to Cuba are covered by
tariff concessions which the United States obtained from that country under the
trade-agreements program. Some examples of concession items in which trade
Raw cotton ------------------------------------------------------------------
$448,000
$1,546, 000
Wheat flour-------?---------------------------------------------------------
6,361,000
8,502,000
Crude petroleum _.--------------------------------------------------------
1, 379, 000
6,145,000
Oasoline asoline -----------------------------------------------------------------------
1,975,000
7,273,000
Lubricating oils------------------------------------------------------------
684, 000
905, 000
Autos, trucks, pans and accessories__________________________________________
5, 500, 000
28, 308,000
Cuba has no general controls over its import trade. Import licenses are
required for 6 commodities, on 4 of which the United States had been granted
tariff concessions (wheat, rice, potatoes, and tires and tubes). But this has had
a negligible effect upon Cuba's total imports from the United States.
UNITED STATES EXPORTS TO DENMARK OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Denmark increased from $17,150,000 in 1937 to
$38,300,000 in 1953, an overall increase of 123 percent.
Approximately 35 percent of United States exports to Denmark are covered
by tariff concessions which the United States obtained from that country under
the trade-agreements program. Some examples of concession items in which
trade has increased are as follows:
Wheat ----------------------------------------------------------------------
$179,000
$185, 000
Canned fruit ------------------------------------- ---------------------------
16,000
58,000
Soybeans---------------------------------------------------??--------------
0
4,156, 000
Leaf tobacco-----------------------------------------------------------------
670,000
7,412,000
Raw cotton -------------------------------------------------------------------
2,320,000
5,755,000
Refrigerators------------------------------------.----------------------------
1,000
4,000
IA-RDP,59-00224A000100310002-9
 Approved For Release : CIA-RDP59-00224A000100310002-9
TRADE AGREEMENTS EXTENSION ACT OF 1955 69
Denmark has recently removed licensing requirements for about 38 percent
of its imports. The following are examples of commodities on which the United
States has trade-agreement concessions and which Denmark has freed of import
restrictions:
Bluegrass seed Combines, with electric elements
Redtop grass seed Combines, other
Certain leaf tobacco Parts of combines
Raw cotton and linters Parts of drilling and boring machines
Gum and wood rosin Parts of metalworking machines
Aircraft engines and parts Files and rasps
Motion pictures Methyl chloride
Carbon black
UNITED STATES EXPORTS TO THE DOMINICAN REPTIBLIC OF PRODUCTS SUBJECT
TO TRADE AGREEMENT CONCESSIONS
Total United States exports to the Dominican Republic increased from
$6,371,000 in 1937 to $47,000,000 in 1953, an overall increase of 638 percent.
Approximately 30 percent of United States exports to the Dominican Republic
are covered by tariff concessions which the United States obtained from that
country under the trade-agreements program. Some examples of concession
items in which trade has increased are as follows:
Prepared oat cereals-------------------------------------------?--------?--
Wheat--- ------ ------------------------- ----------------------
Wheatflour -----------------------------------------------------
Fresh fruit ------------------------------------------------------------------
Canned peaches------------------------------------------------------------
Canned pears ------------------------------------------------------------
Typewriters----------------------- ----------------------------
Fountain pens --------------------------------------------------------------
United States exports
$39,000
15,000
16,000
22,000
2,000
2,000
19, 000
3, 000
$152.000
9(),000
1,361,000
175, 000
9, 000
7, 000
6"r, 000
20,000
The Dominican Republic requires import licenses only on wheat and wheat
flour, rice, radio transmitting equipment, and fertilizers.
UNITED STATES EXPORTS TO EL SALVADOR OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to El Salvador increased from $3,593,000 in 1937
to $37 million in 1953, an overall increase of 930 percent.
Approximately 12 percent of United States exports to El Salvador are covered
by tariff concessions which the United States obtained from that country under
the trade agreements program. Some examples of concession items in which
trade has increased are as follows: - -
Tires and tubes--------------------- --------------------------------------
$77, 000
$288, 000
Leather---------------------------------------------------------------------
114, 000
253, 000
Canned mackerel ------------------------------- ------------------
2, 000
170, 000
Fresh apples, pears, and grapes---------------------------------------------
21, 000
111,000
Canned asparagus, peas, corn, and tomatoes---------------------------------
7, 000
75,000
Canned peaches, pears, and mixed fruit--_----------------------------------
28, 000
43,000
Phonograph records---------------------------------------------------------
7, 000
58, 000
Rubber hose--------------------------------------------------------------
4,000
28,000
Canned pork ----------------------------------------------- ----------------
5,000
41 000
Oatmeal, rolled oats, and preparations---------------------------------------
12,000
1,000
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 Approved For Release : CIA-RDP59-00224A000100310002-9
has increased are as follows:
UNITED STATES EXPORTS TO FRANCE OF PRODUCTS SUBJECT To TRADE
AGREEMENT CONCESSIONS
Total United States exports to France and its dependencies increased from
$174,135,000 in 1937 to $392,500,000 in 1953, an overall increase of 125 percent.
Approximately 87 percent of United States exports to France are covered by
tariff concessions which the United States obtained from that country under the
trade-agreements program. Some examples of concession items in which trade
United States exports
1937
1953
Cotton, raw, ginned, unbleached ----------------_ .--.-------.--------------
$44, 025, 000
$34,196,090
M.tebiretools---------------------------------------------------------------
3,621,000
10,855,000
Oranges, fresh or dried ----------------------------------------- --------------
38,000
858,000
E13ctric:household refrigerators-----------------------------------------------
750,000
1,164,000
Steel sheets (automobile bodies) ------------------.--------_----------------
1,016,000
4,389,000
Ca.lculating machines and parts ---------------------------------------------
2,170,000
4,831,000
UNITED STATES EXPORTS TO THE FEDERAL REPUBLIC OF GERMANY OF PRODUCTS
SUBJECT TO TRADE AGREEMENT CONCESSIONS
Total United States exports to Western Germany increased from $122,993,000
in 1937 (all of Germany) to $348,200,000 in 1953, an overall increase of 183 percent.
Approximately 75 percent of United States exports to Western Germany are
covered by tariff concessions which the United States obtained from that country
under the trade-agreements program. Some examples of concession items in
which trade has increased are as follows:
Cum (maize) ----------------------------------------------------------------
W heat. ---------------------------------------------------------------------
Grapefuit-----------------------------------------------------------------
Lr'rd------------------------------------------------------------------------
Dried milk----------------------------------------------------------------
Tires and tubes--------------------------------------------------------------
Sewing machines------------------------------------------------------------
Typewriters-----------------------------------------------------------------
$103, 000
731,000
1, 000
265, 000
0
14, 000
1,000
32,000
$7,748,000
60, 264, 000
7, 000
4,829,000
286,000
25,000
6,000
159,000
Western Germany has been getting rid of some of its import restrictions on
dollar goods. About one-third of the value of German imports from the United
States in 1953 were free of import restrictions. The following are examples of
commodities on which the United States has trade-agreement concessions and
which have been freed of import restrictions:
Coniferous resins
Unrefined lard
Rendered tallow, unfit for human consumption
Oleostearine, unfit for human consumption
Monchydric alcohols and. derivatives
Turpentine and other distillate products of coniferous resins and woods
Disinfecting, insecticidal, fungicidal, weed-killing, and similar preparations
Goatskin leather, dressed.
Douglas fir
Cotton
Linters
Air pumps and air or gas compressors
Baking machinery and equipment
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TRADE AGREEMENTS EXTENSION ACT OF 1955 71
'Sewing machines
Leathermaking machinery
Machine tools, metalworking
Machines for working wood, plastics, and other hand-carving materials
Typewriters
Calculating and accounting machines
Parts and accessories for office machines and appliances
Mining locomotives
Motor vehicles
UNITED STATES EXPORTS TO GREECE OF PRODUCTS SUBJECT TO TRADE AGREEMENT
CONCESSIONS
Total United States exports to Greece increased from $5,829,000 in 1937 to
'$50,100,000 in 1953, an overall increase of 760 percent.
Approximately 27 percent of United States exports to Greece are covered by
tariff concessions which the United States obtained from that country under the
trade-agreements program. Some examples of concession items in which trade
has increased are as follows:
Evaporated milk ------------------------------------------------------------
$1, 000
$787,000
Wheat------------------------------ --------------------------------------
663, 000
11, 497,000
Refrigerators--------------------------------------- -------------------------
22,000
231, 000
;~ountain pons---------------------------------------------------------------
1,000
79,000
Over 90 percent of all commodities imported by Greece are free of import
restrictions. The items free of import controls include all concessions obtained
by the United States from Greece except the concessions on furs and machinery.
UNITED STATES EXPORTS TO GUATEMALA OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Guatemala increased from $7,397,000 in 1937 to
$44,300,000 in 1953, an overall increase of 499 percent.
Approximately 27 percent of United States exports to Guatemala are covered
by tariff concessions which the United States obtained from that country under
the trade-agreements program. Some examples of concession items in which
trade has increased are as follows:
Lard
$37, 000
$1,021,000
Evaporated, condensed, and dried milk------------------------------------
25, 000
488,000
Sardines and other canned fish----------------------------------------------
17, 000
156, 000
Wheat and wheat Hour--------------------------------------------------- --
567, 000
1,988,0()0
Cotton yarn and fabric-------------------------------------------------
493, 000
3
870
000
Tires and tubes ------------------------------------------
04,000
,
,
366,000
Automobiles, trucks, and buses ----------------------------------------------
537, 000
3,557, 000
Typewriters, duplicating and calculating machines--------------------------
62,000
380,000
'Cotton shirts------------------------------?---------------------------------
37,000
270,000
Guatemala maintains no quantitative controls over its exports.
UNITED STATES EXPORTS TO HAITI OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Haiti increased from $4,025,000 in 1937 to
$28,800,000 in 1953, an overall increase of 616 percent.
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TRADE AGREEMENTS EXTENSION ACT OF 1955
72
Approximately 15 percent, of United States exports to Haiti are covered by
tariff concessions which the United States obtained from that country under the-
trade agreements program. Some examples of concession items in which trade
Las increased are as follows:
United States exports
1937 1953
Dried milk -------------------------------------------------------------------
lWaporated milk .------------------------------------------ -----------------
Cereals of oats---------------------------------------------------------------
1resh apples ------------------------------------- -----------------------------
Itaishis--------------------------------------------------------------------
Prunes- ------------------------------------------------------------------
'I'ires and tubes ------------------------------- -------- --- - -------------
Surgical dressings-----------------------------------------------------------
Radics -- -------- ------------------------------------------------------
Automobiles (passenger)---------
$:1, 000
B, 000
4, 000
4, 000
1,000
000
51,000
[')'000
19,000
1h3000
$63, 000^
36, 000
22, 000
17,0W
6,000
6, Gal
1
266,00(
73, 000
55.000
907,000
Haiti requires import licenses only on a few items, tobacco products, firearms,.
ammunition and explosives, none of which are subject to tariff concessions.
UNITED STATES EXPORTS TO HONDURAS OF PRODUCTS SCBJECT TO
TRADE AGRECMENT CONCESSIONS
Total United States exports to Iondurns increased from $5,492,000 in 1937 to
$35,500.000 in 1953, an overall increase of 546 percent.
Aloproxi mately 18 percent of United States exports to Honduras are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
has increased are as follows:
and buses--------------------------------------------
trucks
Passenger cars
$93, 000
$2,712,000
,
,
Cotton hosiery and shirts
--
--------------------------------------------------
19,000
388,000-
-
-
flags and sacks
-----------------------------------------------
52,000
202,000
---------------
and dried - -------------------------------------------
canned
Fruits:fresh
,:5,000
119,000
,
,
Bakery products
------------------------------------------------
14,000
143,000
-----------
Wheat flour
---------------------------------------------
-
-
75, 000
736, 000
--------------
-
-
and dried milk-------------------------------------
evaporated
Cond
ensed
46,000
239, 000
,
.
,
Canned sardines
--------------------------------------------
9,000
132,000
-------------
Denims
------------------------------------------
11,000
417, 000
-----------------------
cinals and pharmaceuticals ---------------------------------------------
M ed
1 4i4, 000
1,140,000
..
Toilet soaps
------------------------------------------------
15,000
87,000,
-.. --------------
Camed meats and vegetables-----------------------------------------------
"),000
142, 000
Honduras has administered its exchange control system liberally and in July
1951) had an across-the-board relaxation of exchange controls.
UNITED STATES EXPORTS TO ICELAND OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Iceland increased from $174,000 in 1937 to.
$13,300,000 in 1953, an overall increase of over 7,000 percent.
Approximately 29 percent of United States exports to Iceland are covered by
tariff concessions which the United States obtained from that country under the
trade agreements program. Some examples of concession items in which trade
has increased are as follows:
IA-RDI59-00224A000100310002-9
 Approved For Releasq ? 9)&5Rf 5A 0Vg4A00010( A10002-9
TRADE AGREEMEN 5 A
Raisins and prunes----------- ----------------------
Whaat flour--- --------- -- -
Cottonseed and soybean oil -------------------------------------------------
Lubricatine oils --------------------- ----------------------------------
-Office m achinery and parts---------------------------- ----
Rubber boats--- ------------------------- ---- ----------------------------
United States exports
0
$2, 000
0
1,000
5,000
16,000
$112, 000
599,000
85, 000
124, 000
79,000
42,000
Iceland has lifted all import restrictions on the following trade agreement items:
Rice and rice grits Other cereals
Corn and cornmeal Cottonseed and soybean oil
Wheat flour Lubricating oils
Oatmeal and oat grits Rubber boats
UNITED STATES EXPORTS TO INDIA-PAKISTAN OF PRODUCTS SUBJECT TO
TRADE-AGREEMENT CONCESSIONS
Total United States exports to India-Pakistan 1 increased from $35,377,000 in
1938-39 to $249,400,000 in 1953, an overall increase of 605 percent.
Approximately 29 percent of United States exports to India-Pakistan are
covered by tariff concessions which the United States obtained from that country
under the trade-agreements program. Some examples of concession items in
which trade has increased are as follows:
-------------------------------------------------
Dried skim milk
0
$5,586,000
------------
factures
-----------------------------
d
$1,628,000
2,880,000
--------------------
manu
Tobacco an
-----------------------------------------------
er ore concentrates
Co
0
2,223,000
--
pp
Tractors and parts
--------------- -----------------------------
208, 000
6,988,000
------------
parts and accessories-------- _---------------------------------
Automobiles
8,446,000
12,919,000
,
Medicinaland pharmaceutical preparations---------------------------------
1,634,000
9,101, 000
Since 1954 the trend of India's import trade policy has been toward liberal-
ization.
Among the list of items on which the United States had received tariff conces-
sions and for which India has increased the import quotas or permits free impor-
tation are:
Specified metals and manufactures Chemicals
Drugs and medicines Wood
Agricultural implements Paper
Electromedical apparatus Asphalt
Electric carbons
For the first half of 1955 Pakistan has abolished the distinction between the
nondollar area and the dollar area as sources of imports. Included among the
items now listed as importable from all sources but still subject to licensing re-
quirements are approximately 95 percent of the items on which the United States
had received concessions. They are the following:
Certain mineral products
Drugs and medicines
Radios and parts
Industrial machinery
Food products
Toilet articles
Automotive vehicles
Metals
Chemicals
Office machines and equipment
Refrigerators
Typewriters
Tractors
Tobacco
I The GATT negotiations were with India and Pakistan together. Prewar statistics included both
countries.
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 ARproved f pr Release : CIA RDP59 00224A000100310002-9
T DE
UNITED STATES EXPORTS TO INDONESIA OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Indonesia increased from $24,999,900 in 1937 t
to $103,999,287 in 1953, an overall increase of 315 percent.
Approximately 50 percent of United 6tates exports to Indonesia are covered by
tariff concessions which the United States obtained from that country under the
trade-agreements program. Some examples of concession items in which trade
has increased are as follows:
United States exports
1931 i I 1953
]lardvvares--------------------- ---
g8)4, Files and rasps--------------------------------- --?- 000
Pliers--.------------------------------------------------------------ -------
J'umps and parts ---------........................... - (90, 000
$7, 00(8
238,000,
4, 000
702,000
I Statistics in 1937 are given for Netherlands East Indies, later named Indonesia.
2 Less than $500.
UNITED STATES EXPORTS TO IRAN OF PRODUCTS SUBJECT TO TRADE AGREEMENT
CO 4CESSIONS
Total United States exports to Iran increased from $5,456,000 in .1 937 to
$21,4110,000 in 1953, an overall increase of 292 percent.
Approximately 83 percent of United States exports to Iran are covered by tariff
concessions which the United States obtained from that country under the trade-
agreements program. Some examples of concession. items in which trade has.
increased are as follows:
Lubricating oils and greases-----------------------------------?----------
Tires and tubes
Automobiles, buses, chassis, parts, and accessories ---------------------------
Pump---------------------------------------------------------------?----
R.efrigeration and air-conditioning equipment -------------------------------
Radio receiving sets and tubes _-------------------------------------------
Tractors--------------------------------------- ---------- -------- ----------
$25, 000
655,000
2,962,000
51,0()0
1,0()0
5, 000
12, 000
1953
$164, 000,
2, 610, 000
3,243,000
189, 000
230, 000
130, 000
467,000
UNITED STATES EXPORTS TO ITALY OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Italy increased from $75,775,000 in 1937 to
$28'0,900,000 in 1953, an overall increase of 271 percent.
Approximately 54 percent of United States, exports to Italy are covered by
tariff concessions which the United States obtained from that country under the
trade-agreements program. Some examples of concession items. in which trade
has increased are as follows:
k,heat ---------------------------
Raw cotton----?-----------------------------------------------------
Metalworking machinery ---------------------------------------------------
Calculating machines, cash registers, typewriters, and parts-----------------
Tractors, trucks, passenger cars, parts and accessories------------------------
Filrn-unexposed and exposed, motion picture-silent and sound------------
Dried prunes---------------------------------------------------------------
United States exports
1937 1953
$459, 000
33, 294, 000
1,661,000
828, 000
2,042,000
119,000
1], 000
$27, 546, 000
42, 604, 000
22,198, 000
2,928,000
4,206, 000
482,000-
414,000,
During the postwar period, Italy has found it necessary to maintain duanti
tative import restrictions on many products because of balance-of-payments
IA-RD49-00224A000100310002-9
 Approve BorARaleams C#h 5 O 224A000100X 10002-9
difficulties, and has had to concentrate its expenditure of dollars on essential
commodities. However, approximately 23 percent of its trade with the dollar
area has been liberalized. The following are examples of commodities on which
the United States has trade-agreement concessions and which Italy has freed of
import restrictions:
Vaseline
Solid paraffin
Carbon black
Silicons, plastic materials, condensation, and polycondensation products
Absorbent cotton in packets weighing not more than one-half kilogram
UNITED STATES EXPORTS TO NEW ZEALAND OF PRODUCTS SUBJECT TO
TRADE AGREEMENT CONCESSIONS
Total United States exports to Now Zealand increased from $23,824,000 in
1937 to $31,400,000 in 1953, an overall increase of 32 percent.
Approximately 65 percent of United States exports to New Zealand are covered
by tariff concessions which the United States obtained from that country under
the trade-agreements program. Some examples of concession items in which
trade has increased are as follows:
Books and other printed matter_____________________________________________
$275,000
$341,000
Office machines and appliances______________________________________________
347,000
722,000
Metalworking machinery---------------------------------------------------
136,000
207,000
Tractors and parts----------------------------------------------------------
2,239,000
4, 632, 000
Tobacco and manufactures. _____________________________________________-_-_
1,270,000
4,631, 000
Medicinal and pharmaceutical preparations ---------------------------------
59,000
111,000
Woodworking machinery----------------------------------------------------
53, 000
255, 000
During the postwar period, New Zealand has found it necessary to maintain
quantitative import restrictions on many products because of balance-of-payments
difficulties, and has had to concentrate its expenditure of dollars on essential
commodities. New Zealand has recently increased the list of items free of import
restrictions. The following are examples of commodities on which the United
States has trade-agreement concessions and which New Zealand has freed of
import restrictions:
Hardware Refrigerating units
Agricultural tractors Kidskin leather
Radio tubes Paper products
Machinery Motor vehicles
UNITED STATES EXPORTS TO NICARAGUA OF PRODUCTS SUBJECT TO TRADE
AGREEMENT CONCESSIONS
Total United States exports to Nicaragua increased from $3,293,000 in 1937
to $25,900,000 in 1953, an overall increase of 687 percent.
Approximately 29 percent of United States exports to Nicaragua are covered
r by tariff concessions which the United States obtained from that country under
the trade-agreements program. Some examples of concession items in which
trade has increased are as follows:
Wheat flour-- -------------------------------------------
$197, 000
$685, 000
Evaporated milk-----------------------------------------------------------
8,000
57,000
Dried milk-----------------------------------------------------------------
6,000
51,000
X-ray equipment----------------------------------------------------------
0
2'-',000
Typewriters------------------------------------------------ __ ------------
0,000
115,000
Tractors---------------------------------------------------------------------
4,000
459,000
Fountain pens--------------------------------------------------------------
2,000
17,000
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 A proved For Release : CIA-RDP59-00224A000100310002-9
TRADE AGREEMENTS EXTENSION ACT OF 1955
IA-RDP~59-00224A000100310002-9
li
Quantitative import restrictions in Nicaragua are negligible, and are not