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Marine Review April 1932 « EDITORIAL » ‘Why Reason Should Prevail In Our Tariff Policy UR merchant marine is divided into two O major divisions of service, domestic and foreign. Both are suffering severely from lack of business due to the general depres- sion. Both would be helped by an improvement in foreign trade. By selling more automobiles, for instance, to the foreign market, more steel would be required and this in turn would in- crease the demand for ore brought down the lakes in American ships. There is sometimes an irony in circumstances which passes all ordinary understanding and inclines one to wonder if our less sophisticated ancestors were entirely wrong in believing in good and evil sprits. The American merchant marine, since the war gave it an impetus, has been struggling with the aid of effective govern- ment legislation, to establish itself on a firm going business basis. Strategic routes from the United States all over the seven seas to all parts of the world were laid out to be served by American ships. Under normal conditions the mail pay guaranteed by the government for service rendered would keep them going against the competition of foreign ships costing less to build and operate. Then along comes a world depression as bad or worse in our own country as anywhere else. Freight and passenger traf- fic dwindle to new low levels. The world finds its supply of ships far in excess of the demand. New ships completed and building to enter these strategic mail routes face a bleak outlook. It is clear that in spite of government aid our merchant marine either domestic or foreign, cannot be successfully operated on any consid- erable scale without overseas trade. Therefore, any wise measure which will aid in reviving foreign trade is of paramount importance to the shipping industry. The revival of foreign trade is also of paramount importance in the return of general prosperity. Undoubtedly one of the important factors in the decline of com- merce is our present tariff policy. This country has prospered under a policy of protective tariff in the past not because the tariff assessed has had the effect of destroying foreign trade but because such tariff protection, while serving to prevent dumping of cheap for- eign goods to the detriment of our own manu- facturers, has not prevented the growth of a tremendous trade. We have bought from and sold to the rest of the world billions of dollars worth of goods during the period of our great- est prosperity. In the fiscal year ending June 30, 1931 our total merchandise exports amount- ed to $3,084,000,000, a 34 per cent drop, and total imports of $2,432,000,000, a decrease of 37 per cent, from the totals for the fiscal year ending June 30, 1930. It would therefore seem to be a wise policy for the national welfare to consider seriously some measure of tariff reciprocity. This does not mean free trade. It does not mean a drastic revision downwards. An international discus- sion of the tariff question is just as much in or- der as an international discussion on disarma- ment. It is well recognized that the tariff is a powerful offensive and defensive weapon. Ina sense tariff is simply a step toward embargo sometimes used against an offending nation. We might as well give up the idea that we can live unto ourselves alone in a world which has been made so small and closely knit by modern methods of communication. Actually we are a member of the family of nations and while we should jealously guard our independ- ence of action we must recognize not only the necessity but the advantage of intellectual and mercantile exchange. It is idle to talk about having everything we need within our own borders, that we are self-contained and that we can prosper without contact with the rest of the world. Nothing of the sort. We are in- stead utterly dependent on maintaining our lines of communication. We need our own ships. To serve us well they must have an opportunity to prosper. They cannot prosper on the isolationist’s theory. Hence we are in favor of a reciprocal tariff policy to promote trade. This is not in any sense of the word a partisan problem. We must buy if we wish to sell and the restoration of foreign trade essential for the welfare of our merchant marine will be a stimulus to our domestic recovery. MARINE REview—April, 1932 AT