Courtesy Reuters

Tariff Bargaining

THE President has pronounced in favor of reducing the tariff by negotiating with foreign countries. The United States appears about to dive headlong into the maelstrom of European bargaining tariffs. What are the implications of this change of policy? What are the probabilities and possibilities? Does it mean an era of lower tariffs? Does it mean an era of tariff discriminations and tariff wars? Does it mean the end of the most-favored-nation clause and of equality of treatment? Can there be effective bargaining under our existing treaties? Is the United States to lose its sovereign control over its own tariff? What are the domestic political implications? How far does it indicate a change in the center of gravity of our government? How does it affect our relations with our neighbors in this hemisphere?

Of many such questions which spring to mind, at least one can be easily and definitely answered, namely, that concerning the compatibility of a tariff-bargaining policy with our existing unconditional most-favored-nation treaties. But the true answer may not come first into the minds even of those familiar with tariffs and treaties, and the failure to grasp the possibilities has extended beyond popular opinion into our usually best informed circles.

Last summer a prominent political leader attacked our unconditional most-favored-nation treaties as making reciprocity treaties impossible, in these words:

We are powerless now with reference to the nations with which we have made these treaties to accomplish reciprocal trade agreements with any of them without giving to other competing nations trade advantages. This simply makes reciprocal trade agreements impossible. No nation can be induced to enter into any reciprocal agreements, knowing that competing nations with it for the United States trade will get exactly the same favors. . . . A public sentiment must be created against this brazen attempt to nail down the lid on the tariff trap in which we have voluntarily permitted ourselves to be caught. (My italics.)

The tariff is a technical and forbidding subject and the ignorance

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