Tariff making without method

Media

Part of The American Chamber of Commerce Journal

Title: Tariff making without method
Creator: Page, Thomas Walker
Language: English
Year: 1929
Rights
Fulltext: 6 THE AMERICAN CHAMBER OF COMMERCE JOURNAL July, 1929 It yields quickest when treated early, quite readily in the incipient stage. This means, of course, that treatment stations ought to be in operation in the various parts of the islands where leprosy is frequent; there are such stations at Manila and Cebu, and should be others at Legaspi, Iloilo, in Ilokos and in Mindanao. Dr. José N. Rodríguez has charge of the Cebu treatment station, just being completed with the Eversley Childs fund of $180,000. That’s about what the bill will be for any duplicate of this unit, but it is a well-equipped station and equal to its task. Dr. Rodríguez reports that lepers voluntarily go to the station for treatment. It seems reasonable to expect that among the patients will be many incipient cases, which diligent treatment can arrest in comparatively a short time. What about the P20,000 for the check-up on cured lepers? The Jo u r n a l sends its small donation, wishing the movement well. The Tariff Making Without Method By Th o ma s Wa l k e r Pa g e During the twentieth century American commerce with foreign nations has grown in volume and has changed substantially in character and in composition. Changes of no less moment have likewise taken place in nearly all branches of domestic industry. The proper adjustment, therefore, of commercial legislation to business needs has become more delicate and difficult at the same time that it has been assuming more vital importance. There has been increasing urgency in the demand that, in shaping legislation, instruments of greater precision should be substituted for the broadax and saw that have too often been used to roughhew measures for business regulation and to fit them into the structure of party politics. Particularly in regard to the tariff has this demand grown pressing. For twenty years it has been current in such expressions as “take the tariff out of politics,” or “make it scientific”—vague expressions which really mean that in some way the tariff, whether enacted for revenue or for protection, should be adapted more accurately and quickly to the varying exigencies of the United States Treasury and of American business. No little dissatisfaction with the manner in which the tariff is made grows out of the business disturbance caused by the prolonged uncertainty about the rates of duty. It is true that some disturbance must result whenever any effective duty is imposed or removed, but it is needlessly increased by protracting the anxiety and insecurity that prevail between the beginning and the completion of a tariff revision. Industry and commerce tend to adjust themselves to meet such new conditions as the revision may bring when once the conditions are known; but until the rates of duty and the The Eleventh Hour j VHIS week is the deadline—the eleventh hour—the last moment of preparation for the girls and boys who are venturing forth in search for wisdom. You, parents see to it that they are properly prepared to do the aidous tasks before them. Make sure their eyes are right by having them examined now. Always the best in quality but never higher in price government is probably giving to leprosy about all that may be expected from a popular treasury subject to pork-barrel invasions; it is giving Pl,500,000 this year, about 1/3 of the total appropriation for the health service. The .generalization seems to hold, that no funds asked of charity are more carefully and sensibly expended than those asked for the leper work in all its branches. None of these can be dispensed with, either, without injury to the work as a whole. Having mentioned two names, one or two more are in order. Dr. W. H. Wade, who was interviewed in preparation for this article, is chief pathologist at Culion. Technical medical work there is under Dr. Casimiro B. Lara. The chemical work is under Dr. Howard I. Cole, who succeeded Dr. Perkins. In Manila, at the science bureau, Dr. A. P. West has been engaged for years on research in the chemistry of chaulmoogra oil. His work is in the field of pure science, and very thorough-going. The accompanying article is Chapter I in Making the Tariff in the United States, by Thomas Walker Page, of the Institute of Economics, Washington, D. C. The book is published by the McGraw-Hill Book Co., 370 7th Ave., N. Y., and if memory serves the price is $2.50. The book is in its second edition. It is quite an informed and complete disquisition on the American tariff, and designed to inculcate knowledge about better ways of making the tariff than the method described here, which is the one which has always been followed. President Hoover has had occasion to denounce the 1929 tariff, just enacted, as in no wise his; indeed, it almost ranks as a foundling among Federal laws, no one wishing to acknowledge authorship of it. Dr. Page is well worth reading on the tariff, and all Institute books are erudite unbiased treatises. This one has 273 pages and an index. The Institute of Economics is a Carnegie foundation. It is vitally interested in the situation of the Philippines in relation to the American tariff. Dr. Page himself is interested, so here are friends at court.—Ed . terms of payment are fixed and understood adjustment is impossible, commitments are precarious, and business is enveloped in an atmosphere of insecurity. While Congress is preparing to legislate, radical and reactionary proposals are sure to find some advocacy in committee or on the floor, and the publicity given them adds to the general uneasiness. All sorts of rumors of impending action gain currency. The papers are filled with the baseless predictions of interested parties. Partisan spokesmen put out misleading estimates of the effects to be expected from the contemplated revision. Some members of Congress are accused of being swayed by unworthy motives; others are suspected of lacking decision, and pressure in many forms is brought to bear upon them to control their votes. Innumerable delegations and individuals visit Washington to argue, persuade, threaten, and plead. Many organizations open offices thdte to watch proceedings, keep their members informed, and mobilize all possible forces that might aid in securing the kind of tariff that would serve their particular needs. Intense jealousies and controversies arise among the conflicting interests and are reflected in committee deliberations and debates on the floor. So bitterly are they sometimes expressed that public welfare seems to be outweighed by personal antagonisms. “Blocs” and factions are formed to work primarily for some special advantage to particular industries or sections. Unrelated topics are dragged into the discussions both in Congress and in press in such a way as to becloud the issue and to prevent a reasoned and intelligent understanding of the particular matters under consideration. Doubt remains until the last vote is taken in regard to the outcome of a procedure attended by so much confusion, acrimony, and personal interest. The damage thus done to the orderly prosecution of business has compelled those that suffer from it to take thought on the need for a simpler and safer way of revising the tariff. No revision since the Civil War has met with general approval. After the passage of any new tariff, dissatisfaction naturally continues among those whose hopes and efforts have been disappointed. It is natural, also, that, knowing the circumstances under which the act was framed, they should impute its unfavorable features to improper influences. And since few obtain quite all they have wished for, the dissatisfied are always a majority. No matter how closely a new tariff may conform in plan and policy to platform pledges and campaign promises, its details are so numerous and it affects such a multitude of interest that it invariably offends more people than it pleases. The general discontent offers a fruitful field for work by the press and by spokesmen of the opposition party to discredit the act and all who are responsible for it. But when, as has sometimes happened, the opposition comes into power and itself undertakes a revision the result has been not so much to lessen the amount of discontent as merely to shift a part of it from one group of interests to another. Under control of neither of the two great parties has Congress succeeded in making a tariff that commanded enough approval to give promise of stability. Disappointment with the numerous revisions of the last thirty years has fostered the belief that Congress must either radically reform its methods of making the tariff or must empower some other agency to shape a measure that so intimately concerns the business welfare of the country. The damage caused by the confused and contentious activities that accompany tariff making, the disappointment of selfish interests, and the chagrin of some groups at their own failure and at the success of others in the use of personal and factional influence account for much of the prevailing discontent with the usual unmethodic procedure. A stronger ground for criticism is found in the outstanding truth that every one of the six general revisions of the past thirty years has contained numerous rates and provisions that were in accord neither with the public welfare nor with the policy announced, by the party entrusted with power. It would be invidious to specify such instances of offense in successive acts, although some are notorious and have been almost universally admitted. Indeed, no act in a generation has found defenders willing to assert that IN RESPONDING TO ADVERTISEMENTS PLEASE MENTION THE AMERICAN CHAMBER OF COMMERCE JOURNAL July, 1929 THE AMERICAN CHAMBER OF COMMERCES JOURNAL it did not swerve in important details from the line of equal justice. The utmost claimed for each of them has been, first, that it was better than the law it supplanted and, second, that if time were given, its inequalities would be eliminated by the gradual adjustment of business. The first of these claims has always been disputed, and the second has never been verified by experience; indeed, a contrary tendency has been manifest. The longer the life of a tariff, the more widely has it diverged from the principles announced by its framers and the more unequal have become its effects on the interests touched by it. Very few years, therefore, have usually sufficed to arouse in the country such an outraged sense of justice and of business necessity as to compel another general revision in spite of the harmful disturbance attending it. The repeated failures of Congress to meet more closely the needs of American industry and commerce have done more than all else to stimulate the demand for some different method of making the tariff. The cause for these failures are numerous; but two, each vital in itself, are most persistent. The first is the difficulty of ascertaining the precise rates and provisions that will accomplish the purpose desired. The second is that some members of Congress are chiefly concerned in satisfying their own constituents and must be conciliated bv compromises, bargains, and special concessions before votes enough to pass any tariff bill can be obtained. In some measure, of course, the treatment of the tariff by these members as a local issue is due to prejudice or to a wish to remain in office, but in greater measure it rests on less unworthy grounds. The average member feels more acutely and understands far better the special needs of his own locality or industry than he does the more remote and intricate needs of the country as a whole. It does not necessarily mean a lack of patriotism, therefore, when he refuses to give up benefits that are certain and substantial for others that appear doubtful and thinly diffused. He yields to local and political influence, not so much because of self-interest, as because he does not have the wide and precise information necessary for understanding the bearing of the tariff on the nation as a whole. At every stage in the making of a new tariff the influence of these two reasons for the failure of Congress can be seen. The preparation of the bill begins in the Committee on Ways and Means, which is the most powerful committee of the House of Representatives. The composition of this committee has little relation to the nature of its work. Places on it are eagerly sought and have to be awarded with caution. Unfortunately the members are not selected with a view to their special fitness for their duties, but, apparently, on the principle that in qualifications all members of the House are equal. The choice among them usually recognizes geographical and factional divisions in the House, but except for that restriction it is determined almost wholly by seniority of service. In other words the senior member from a certain section or recognized party group is considered to have a valid claim to a place on this important committee. It is rare, therefore, that a member, when he first joins the committee, has the sort of knowledge and aptitude that the committee’s work peculiarly requires. And as tariff revision has been seldom undertaken except as a result of a party change after an election, it has usually been made at the very time when the membership has the largest proportion of new men. The organization as well as the composition of the committee is likewise controlled by seniority. The chairmanship is usually determined by length of service, and the division of work among the subcommittees goes more by seniority than by merit and industry. To deny the chairmanship to the member of the party in power who can show the longest unbroken term of committee service is an extremely rare violation of precedent. Age, inaptitude/stolid indifference to economic conditions are seldom considered. Seniority and party regularity are the only essential requirements for the chairmanship. It can easily happen that the best men on the committee have little influence on its proceedings and that the work is really dominated by the more prejudiced and politicallyminded members. Once revision has been begun members of the committee have little or no opportunity to make up any handicap in knowledge‘or experience. The information needed for fixing duties is sometimes available only in a form that the committee as composed can not readily use, and sometimes it is not available at all. And even when it can be procured, other demands on the time of committee members distract their attention and divert their energies. Correspondence with their districts, social attentions to visiting constituents, interviews with job hunters, attendance at meetings and conferences both in and away from Washington, the necessity of giving some attention to a multitude of measures before other committees—all these and many things besides, added to their official duties, leave no leisure for persistent study and meditation. When they venture to neglect the outside calls on their time, they do so*at the risk of defeat in the next election. They can make insufficient use, therefore, of the materials relating to economic conditions that numerous agencies have already assembled. No other government in the world has accumulated such a vast amount of trustworthy information about industry, and commerce as the government of the United States, but to the average member of Congress its very volume and detail are appaling. Not many men either in or out of Congress are able to follow through an intricate investigation, interpret elaborate statistical tables, and draw sound independent conclusions from them. Such work requires special aptitude, training, and long practice. To most members, therefore, a bulky government report remains metaphorically as well as literally a closed book. Usually, it is true, there are a few men on the committee who can do work of this kind, but owing to lack of time they have to limit their attention to a small part of the task. When it is remembered that the tariff covers the whole field of industry and commerce, embracing many thousands of items, each of which demands individual attention; and when it is further remembered that public opinion and business stability require that the revision be completed within a few months, it becomes clear how hopeless it is for a committee member to find out what he needs to know by the ordinary methods of systematic study. The committee resorts, therefore, to public hearings as the quickest and simplest means of getting information. But in the great multitude of matters to be heard little time can be devoted to any of them. The men who testify at the hearings are frequently warned to be brief in their remarks. Their whole purpose is to use the time allotted to them so as to make the best case they can We Have The Largest and Most Complete Stock of Drygoods in the Philippines If you need silks, linens, cottons, or notions you can serve yourself best by choosing from our large stocks We also carry haberdashery, and make men’s suits and shirts Manuel Pellicer y Co., Inc. 44 Escolta, Manila Phone 2-11-06 for the interest they represent. That is to say, they are really advocates and not informants. They are not sworn and are not required to tell the whole truth, but may limit themselves to such part of it as sustains their case. They are, indeed, liable to be cross-examined by members of the committee and admissions are sometimes drawn from them that throw light on the other side of the matter in hand. But the crossexaminations often degenerate into confused disputes filled with unsupported statements and expressions of suspicion, and frequently wander off into unimportant details. Many elaborate briefs are presented; and letters, affidavits, newspaper clippings, one-sided excerpts from official and unofficial reports, and all sorts of extraneous materials are admitted. The whole undigested mass is finally printed, and the committee is thus furnished with many volumes of confused and contradictory evidence in which significant facts are apt to be obscured by irrelevant matter and positive denial. The tariff hearings before the Committee on Ways and Means preparatory to the existing law filled more than four thousand printed pages. Such evidence is not designed to overcome sectional or factional bias. It merely furnishes a ready deposit from which any member may dig the materials to support his preconceived ideas or the wishes of his friends. No better way could be found to strengthen prejudice and stimulate misinformation and intrigue. When trustworthy information is lacking, other influences are free to sway the opinion of those who frame the bill. After the hearings are finished the committee members of the majority party go for many weeks into executive session. Here an earnest effort is made, with the aid of clerks, statisticians, and selected advisors to draft a bill that will honestly and reasonably carry out their party’s policy. But that policy is given different interpretations by the different members, who have been intentionally chosen to represent different sections and different party groups. Lacking exact information, and free to choose from the mass of conflicting testimony, each of them naturally gives first place to the views of his own constituents. It is only by a series of concessions and bargains, therefore, that it becomes possible to report out any bill at all. There have been at times chairmen of the committee who have possessed enough talent for leadership to give the bills thus drafted a considerable degree of consistency; but as every factional disagreement in the committee is certain to reappear on a larger scale in the House, even the strongest chairmen have been compelled to make many sacrifices of consistency in order to get a measure that would not stir up insurgents. The bill is voted on by the House under ironclad rules after being framed in committee with a view to conciliating enough diverging opinions IN RESPONDING TO ADVERTISEMENTS PLEASE MENTION THE AMERICAN CHAMBER OF COMMERCE JOURNAL ó AlYlLKl^ADI UtlAJVLBEK W UUMMEKUti JOURNAL July, 1929 to insure its passage. Few amendments on the floor are tolerated. Debate is brief and most of it is perfunctory. In the main the members have to accept on faith the views of their party representatives on the committee, for they have neither time nor means to form an independent judgment on so elaborate and technical a measure. Here and there on both sides a few recalcitrants break away from party lines, and there is no little grumbling and discontent even among the faithful. But in the end the bill is passed with negligible exceptions by a strict party vote. Proceedings in the Senate duplicate in large measure those in the House. But in some respects conditions are different. So long as the bill is in the House Committee on Ways and Means the public is ignorant of its terms. But when that committee reports it to the House it is published, and the brief debate that follows, though it contributes little to the result, does direct attention to its salient features. By the time the bill reaches the Senate, therefore, every interest it affects is roused to more strenuous efforts, some to maintain what they have got, others to get more, and many to defeat provisions that they consider unfavorable. The press, now furnished with a distinct mark at which to direct its comments, devotes less space to generalities and more to the specific provisions of the bill. Public discussion is diverted from broad tariff policies and fastens on significant particulars. Numerous adjustments are demanded by opposing sections and interests. Open hearings are conducted by the Committee on Finance of the Senate, to which the bill is referred, in much the same way as by the Committee on Ways and Means, of the House. They seldom develop many new and helpful facts, but as feeling has grown more bitter the hearings are usually marked by greater arrogance among the claimants and resentment among the disappointed. Without exception the country has always appeared to receive a House tariff bill with disapproval. Protests come from some quarter against so many of its details as to give the impression that its enactment into law could not fail to oust the majority party from power. Accordingly when the majority members of the Finance Committee of the Senate go into executive session it is with a clear understanding that for party safety they must make the bill more widely acceptable. To do so usually involves many hundreds of amendments and sometimes so radically changes the bill as to make it recognizable only through its title and number. In most of the recent tariffs these amendments have commonly been in the nature of an increase of duties, either directly by raising rates or indirectly by changing classifications. This is done because high duties tend more than do low duties to conciliate those opponents who are most active. The committee is smaller than the corresponding committee of the House and there are fewer new men on it. . Owing to their longer political experience the members are readier to make concessions to expediency, are more amenable to leadership, their proceedings are more dignified and less contentious; agreement, therefore, is more easily reached. But political considerations weigh even more heavily in the Senate than in the House; and interested Senators do not wait until the bill is on the floor before exerting their influence. Even during executive sessions of the committee it is not infrequent that Senators who are not members of the committee interrupt to argue and persuade and to introduce constituents who want a chance to present ex parte statements without being embarrassed by publicity. The work does not progress far before the position of practically every Senator is known, and the committee is made aware of the particular provisions in which each is interested. It then becomes its task to arrange compromises in such a way as to secure a majority when it comes to a vote on the bill. Unfortunately, such compromises can not be in the nature of a general moderation of policy or a consistent and systematic adjustment of terms throughout; they consist rather in distributing disproportionately high or low duties in such a way as to satisfy “blocs” and individuals whose votes will be determined not bv the merit of the bill as a whole but by the manner in which it covers the special interests that concern them. When the bill reaches the floor of the Senate it usually appears that agreement by majority of the committee does not mean that the bill will be accepted practically unchanged by the Senate, as is usually done, however disapprovingly, by the House. Debate is not cut short by the Senate rules; it is long and searching, and the committee must make more than a perfunctory defense of its proposals. Furthermore, sectional and factional influences are fully as strong and much more vocal in the Senate than in the House, and under the Senate rules insurgency is easier and more prevalent. In the main, the committee’s recommendations are sustained, but amendments proposed on the floor by individual Senators are sometimes adopted that are quite inconsistent with the rest of the bill. In this way maladjustments and inequalities are apt to be further increased. On the other hand, the long debate occasionally shows up discrepancies in the committee’^ proposals that the Senate sees fit to smooth away. All in all, however, when the vote is taken in the Senate on the bill as a whole, it usually shows less of logical arrangement and systematic adherence to a common standard and a definite policy than at any previous stage. From the Senate the bill goes to conference Useful Plants in Foreign Lands By P. J. We s t e r Wisely directed plant introduction is one of the most potent and significant factors in the improvement of agriculture. More than that, it creates new empires, nations and industries, destroys old ones and revolutionizes age-old world commerce and trade routes. Corn and tobacco excepted, every important crop in the United States has been transplanted from some foreign country. Wheat spread from Syria through the temperate zones. The potato, originally from the highlands of South America, has become the world’s most important starchy vegetable. The citrus fruits from the Orient transported to Florida and California have created new industries in a once barren unproductive land. The alfalfas introduced into America from Europe and Asia have proved of incalculable value. Of no less interest is the fact that few plant Atlantic Gulf and Pacific Co. OF MANILA ENGINEERS MANUFACTURERS CONTRACTORS 71-77 Muelle de la Industria MANILA, P. I. in a committee composed of an equal number of members designated by each house. Meetings are held behind closed doors and sometimes continue for several weeks. Numerous concessions are made by both side§. Many of them are of minor significance, but some of them give to whole paragraphs and schedules a form quite different from that in which they were passed by either house. New information is seldom sought or offered. In deciding the points at issue less attention is given to their relation to the declared principle of the bill than to the impression that the action taken will make on the respective houses. Much effort is made to have it appear that each house yields in about equal degree to the other, and this sometimes leads to the sacrifice of important provisions. Sometimes agreement is difficult and settlement is determined in large measure by endurance and bluff. The bill reported back by the conference committee is almost invariably voted on as a whole regardless of the changes made in it. Extremely seldom is it sent back to conference by either house for further adjustment; and although in its final form it is safe to say thp,t no man in either house gives it unqualified approval, and that few even know just what it contains, yet it has never happened that a bill getting through the stages described failed of passage by Congress. industries have been built up on the native heath of the species concerned. Brazil lost her one-time rubber monopoly to tropical Asia, but built up her chief industry, coffee, from the importation of a plant from Abyssinia, where coffee is of little or no importance. West Africa once had a monopoly of the oil palm that is now being threatened by the modern plantations in Sumatra and other parts of Malaya. Sumatra, by the way, has also been the first to seriously contend with our Abaca, so long a Philippine monopoly. The tea industries of Ceylon and Dutch Malaya are based on the introduction of plants from China and Assam. In considering the Philippines in relation to plant introductions, we find that all our plant industries except that based on Manila hemp are based on foreign plants imported at one time or another. All our commonly cultivated veIN RESPONDING TO ADVERTISEMENTS PLEASE MENTION THE AMERICAN CHAMBER OF COMMERCE JOURNAL