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Letter to Members of the Public Advisory Board for Mutual Security Requesting a Study of foreign Trade Policies.

July 13, 1952

[Released July 13, 1952. Dated July 12, 1952]

Dear___________:

I am writing you and the other members of the Public Advisory Board for Mutual Security to ask that the Board undertake an investigation of the foreign trade policies of the United States, particularly as they affect our efforts under the Mutual Security Program to achieve economic strength and solvency among the free nations.

I am asking the Board to undertake this assignment because I fear that recent developments affecting our trade policy may work at cross purposes with the basic objectives of the Mutual Security Program.

We are working night and day to help build up the military and economic strength of friends and allies throughout the free world. We are spending very substantial sums of money to do this, to the end that our friends can grow strong enough to carry on without special aid from us. This is why we have urged upon them programs of increased production, trade expansion and tariff reduction, so that through world trade they can expand their dollar earnings and progressively reduce their dependence on our aid.

Yet, at the same time, we find growing up in this country an increasing body of restrictive laws attempting to further the interests of particular American producers by cutting down the imports of various foreign goods which can offer competition in American markets. The so-called "cheese" amendment to the Defense Production Act--enacted despite a number of existing safeguards--is a striking example of this trend. On the one hand we are insisting that our friends expand their own world trade; on the other hand we seem to be raising new barriers against imports from abroad. This poses a very real dilemma for our whole foreign policy.

In my judgment, the first step toward clarifying this situation is for a responsible public group to study this problem and recommend to the President and the Congress the course we should follow in our trade policy. I can think of no group better qualified to do this than the Public Advisory Board for Mutual Security. Representatives of business, labor, agriculture, education, and the public at large make up your membership. Both major political parties are represented. Many of you have held other high positions of public trust. From long association with the Marshall Plan and now the Mutual Security Program, you are familiar with the foreign policy of this country and the problems of international relations.

I want you to consider all aspects of our foreign trade 'policy as Coming within the scope of your investigation. In particular, I think you should examine our tariff policy, with special reference to the expiration of the Reciprocal Trade Agreements Act in 1953; import restrictions, including quotas and customs procedures; agricultural policies affecting foreign trade; maritime laws and regulations concerning carriage of American goods; and what to do about the problems of domestic producers who may be injured by certain types of foreign commerce. I would also like to have your views on the role of international agencies in the trade field.

It is extremely important that the whole problem be examined. The effect of raising a tariff to protect a domestic industry, for example, should be evaluated in terms of the counter-restrictions which are raised against American exports abroad. Our tobacco producers know what this kind of discrimination can mean, but I am sure that there are many others who are not fully aware of it. Neither, I feel, have we really thought through the full implications of our efforts to prevent the rest of the free world from trading with the Iron Curtain bloc. Having insisted that these countries severely restrict their trade in one direction, what can we suggest to replace it?

These are the kinds of problems which I want you to consider. Mr. Gordon Gray made a significant contribution in his study of foreign economic policies in 1950. More recently, the President's Materials Policy Commission, under the leadership of Mr. William S. Paley, has emphasized our national dependence on overseas sources of raw materials. Both of these studies, however, were concerned primarily with other problems and touched rather incidentally upon trade policy.

In order that your recommendations may have the widest possible influence, I believe that you should proceed on an independent basis, not subordinated in any way to the Government agencies concerned. I recognize that the Director for Mutual Security is, by statute, Chairman of your Board. However, Mr. Harriman has suggested, and I agree, that he not sit with the Board for the purposes of this undertaking.

I am asking all the departments and agencies concerned with trade matters to give you full cooperation and whatever assistance you may desire in carrying this work forward.

Very sincerely yours,

HARRY S. TRUMAN

Note: This is the text of identical letters addressed to the following members of the Public Advisory Board for Mutual Security: Sarah G. Blanding, President, Vassar College, James B. Carey, Secretary-Treasurer, Congress of Industrial Organizations, Jonathan W. Daniels, Editor, Raleigh, N.C. News and Observer, Robert H. Hinckley, Vice President, American Broadcasting Company, Eric A. Johnston, President, Motion Picture Association of America, Inc., Allan B. Kline, President, American farm Bureau federation, Orin Lehman, New York City, A. E. Lyon, Executive Secretary, Railway Labor Executives Association, George H. Mead, Chairman of the Board, The Mead Corporation, Dayton, Ohio, George Meany, Secretary-Treasurer, American federation of Labor, Herschel D. Newsom, Master, National Grange, and James G. Patton, President, National farmers Union.

The Director for Mutual Security, Averell Harriman, was ex officio Chairman of the Public Advisory Board, but for purposes of the special study, the Board named as Acting Chairman Daniel W. Bell, president, American Security and Trust Company, Washington, D.C.

The Board was established by the Mutual Security Act of 1951 as the successor to the Public Advisory Board created in the European Recovery Act of 1948.

The Board's report, entitled "A Trade and Tariff Policy in the National Interest" (Government Printing Office, 1953, 78 pp.), was transmitted to President Eisenhower on February 24, 1953.

For the President's statement in response to Gordon Gray's report on foreign economic policy, see 1950 volume, this series, Item 282.

For the President's letter in response to the report of the President's Materials Policy Commission, see Item 179, this volume.

Harry S. Truman, Letter to Members of the Public Advisory Board for Mutual Security Requesting a Study of foreign Trade Policies. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/231183

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