Learn about Life in the 1920s


NO TARIFF WAR is intended, comes the word from Ottawa. But all the denials fail to convince our newspaper editors that Canada has not started a retaliatory fight on our pending tariff, which may be the beginning of a world-wide attack.

"A war may be started without any sort of formal declaration," observes the Chicago Daily News, and "that is true of tariff wars as well as of others." Disquieting shadows of a commercial conflict seem to be cast from more than one direction, we are told.

For besides Canada's provisional adoption of "countervailing" duties aimed at the United States, attention is being called to protests against our tariff coming from more than a score of countries; also to the hostility to the Hawley-Smoot bill, which the Louisville Courier-Journal, for one, sees unmistakably reflected in the recently issued Commerce Department report on our foreign trade for the first quarter of 1930, showing a 20 per cent. reduction from the previous year, and a shrinkage in exports from practically every country in Europe but Russia.

More than a thousand American economists, too, recently asked the President to veto the tariff bill, observing that "there are few more ironical spectacles than that of the American Government as it seeks on the one hand to promote exports through the activity of the Bureau of Foreign and Domestic Commerce, while, on the other hand, by increasing tariffs it makes exportation ever more difficult."

That Congress and the President should heed such warnings seems to be the opinion of a majority of our newspapers, altho there are sharp suggestions that the tariff is our own affair, that no protective tariff ever was popular abroad, and that people that need American goods will buy them anyway, tariff or no tariff.

"Canada already has given a notice which foreshadows tariff hostilities," writes a New York World correspondent from Washington, going on to tell how the present Liberal Government, headed by Premier Mackenzie King, will make the tariff the big issue of this year's election campaign. According to a Department of Commerce review of the Canadian proposals, which are already provisionally in effect, American trade aggregating between $175,000,000 and $225,000,000 is affected, besides which preference is given to a similar amount of British Empire trade.

The new Canadian tariff law does not mention the United States, but it provides for "countervailing duties" under which Canada will levy on imports entering her border from any country a scale of duties equal to the tariff duties imposed by that country on the Canadian products. The preferential rate to British products is either taken off or reduced on 152 items. The Canadian Finance Minister has said:.

"This budget is frankly framed to enable us to buy more freely from those countries which buy from us."

"Canada's Tit for Tat," "Two Can Play Tariff," "Canada Hits Back," "Goose and Gander Again," run the head-lines of editorials commenting on this announcement. Thus, observes the New York World, our pending tariff "serves mainly to inject an element of bitterness into our relations with a good neighbor and to drive her into close trade association with our keenest rival for international trade." Britain is one of our "stiffest competitors," and the Newark News thinks that "a tariff bill which drives our best customer to the shop of this rival is as stupid economically as it is politically." "Short-sighted greed seems to be making short shrift of 'Yankee shrewdness,'" concludes the New York Times. And whatever the damage to our trade, that "would be insignificant compared to the far greater damage to Canadian-American friendship," contends the Washington Star. Hopes are exprest for some kind of understanding between the two countries to prevent an actual tariff war.

"The resentment which is felt in Canada is being shown all about the globe," declares The Nation:

"From nearly thirty countries have come protests of manufacturing or trade groups against the egregious duties proposed by the Smoot-Hawley bill.

"Producers or exporters in France, Italy, Spain, The Netherlands, Denmark, Sweden, Norway, Finland, Germany, Austria, Roumania, Greece, Turkey, Egypt, Persia, and Ireland have protested against the blows that are being aimed at them; those of Australia, India, and the British West Indies have joined with others from Argentina, Uruguay, Guatemala, and Honduras in warning the United States of the menace of the Smoot-Hawley bill.

"There have been unprecedented demonstrations of wage-earners in England and France, and pledges of a boycott of American goods in Switzerland.

"All this, of course, points straight toward retaliation if the tariff bill becomes law."

But not all of our editors take this tariff war so seriously.

The Washington Post thinks that all these fears are "relegated to the scrap-heap of obsolete theory" by Chairman Edgar B. Brossard of the Tariff Commission, who said in a recent address:

"The evidence does not show that, after the Tariff Act of 1922 with its higher rates, European countries passed retaliatory tariffs. Neither does the available evidence show that foreign countries, either in Europe or elsewhere, have adopted higher tariff rates in retaliation for the prospect of increased rates in the tariff of 1930."

Opponents of the tariff bill seem to forget, so the Philadelphia Inquirer thinks, "that there never has been a protective tariff bill which has met with the approval of Europe; and there never will be one." The Los Angeles Express flatly declares that "the United States owes it to the people to make whatever revision of the tariff seems most to their advantage, without consideration for the opinion of the others."

Source: The Literary Digest for May 24, 1930