throwing workers out of employment; or if the imported goods are purchased abroad in any manner whatever at prices greatly below their ordinary cost of production where produced or the market price where purchased; or if imported goods are sold in Australia at a price that is less than gives the importer a fair price upon their fair foreign market value of production together with all charges. The law provides further that these cases of unfair competition shall be heard before court and if the law is violated, the importation of goods may be prohibited either absolutely or subject to any specified conditions or restrictions or limitations.

Dumping legislation was enacted by the Congress of the United States on September 8, 1916. The immediate occasion for passing this Act was the unfair methods of competition which the German coal-tar dye industry had used in maintaining its international supremacy. By this law it is a criminal act for any person importing goods into the United States to sell them within the United States

at a price substantially less than the actual market value or wholesale price of such articles at the time of exportation to the United States in the principal markets of the country of their production, or of other foreign countries to which they are commonly exported, after adding to such market value or wholesale price, freight, duty, and other charges and expenses necessarily incident to the importation and sale thereof in the United States: Provided, That such act or acts be done with the intent of destroying or injuring an industry in the United States, or of preventing the establishment of an industry in the United States, or of restraining or monopolizing any part of trade and commerce in such articles in the United States.

In addition to this prohibition of unfair price cutting, 8 Quoted in Appendix VII.

the law makes provision against the practice known as "full-line forcing." Articles will be assessed with a double duty that are imported into this country under an agreement that any person shall not use, purchase, or deal in, or shall be restricted in his using, purchasing, or dealing in, the articles of any other person. If, for example, the German dye industry controls by patent a color needed in this country, it cannot use the necessity of the American consumer as a means of forcing him to purchase his full line of dyes from abroad when all the colors except the one controlled by the patent can be purchased in this country.

When we come to consider anti-dumping legislation, the importance of the three kinds of dumping already discussed is obvious. It will be recalled that these include: (1) the sporadic selling of goods in order to relieve a surplus, that is, the offering of bargain sales in international trade; (2) a permanent policy of foreign industries of selling in this country a portion of their output at a price below their domestic price in order to keep their factories running full time; and (3) unfair price cutting, the object of which is to injure, destroy, or prevent the establishment of an American industry.

The American legislation of 1916 was directed only against the third type of dumping. It made no provision for preventing the injury to American industries by the first two. Obviously it makes little difference whether American industry is injured or destroyed by the deliberate, intentional acts of a foreign producer, or whether it comes about inadvertently. The intent of the foreigner is of secondary importance so far as national policy is concerned. The result is the thing that is to be prevented.

The Canadian method of stopping dumping has proved effective in practice. Elaborate forms, regulations, and procedure have been devised which have demonstrated beyond all question that the Canadian method is a practicable way of handling the dumping problem. This method is comparatively simple and might be found serviceable in this country, but it is inflexible and in effect results in an increase of the tariff. By tending to raise prices it bears heavily on the consumer. Purchasing abroad at bargain prices does not always injure American industry.

The American legislation of 1916 is, as a matter of fact, the basis of a more satisfactory solution of the dumping problem. This law, however, should be modified both in substance and procedure. It should be extended to include all forms of dumping the result of which is to injure or destroy American industries. It should cover not only those intentional, unfair acts of foreign competitors directed against American industries, but it should include also all selling in the United States at prices below those that prevail generally abroad, or that are below the cost of manufacture abroad.

The criminal provisions of the law may be retained, but there are objectionable cases of dumping which cannot be proved under the strict procedure of criminal law. Then, too, it is not always possible to bring the offending party before our courts since he may be in another country. The criminal provisions of the law should be supplemented by authorizing the President to levy by proclamation additional duties on or to prohibit the importation of goods that are being systematically dumped into the United States, in case he has reason to believe that the result will be to injure, destroy, or prevent the establishment of an American industry. The United

States Tariff Commission, already authorized to investigate dumping, should be designated to hear and consider complaints of dumping and to report its findings to the President for his consideration and action. A dumping law containing these provisions would be more flexible than the Canadian method; it could be adapted in its administration to meet effectively every objectionable case of dumping. This power to prevent dumping by executive order at the discretion of the President, together with the power of the Federal Trade Commission to prevent all unfair methods of competition. used by persons who can be reached by its legal processes, 10 should provide sufficient security for American industry and prevent effectively all unfair attacks upon it.

9 Act creating the United States Tariff Commission, Sec. 704; see Appendix IV.

10 See Appendix X.

the war

CHAPTER IX

EXPORT TRADE AND ITS PROMOTION

Nature of international trade-Necessity and desirability of export business - Export methods in foreign countries before Great Britain - Germany - Post-war plans for promoting trade - Great Britain France - Germany Japan - Canada - Growth of American export trade during the war-In quantity, destination, and variety - Coöperative associations to promote American export trade - Export Associations Act Objections to export associations Activities of non-governmental bodies in promoting export trade — Promotion of export trade by the United States Government Free ports-As there are ways in which export trade should not be promoted, there are also ways in which it should be.

International trade, in the last analysis, is nothing but barter. Through the ordinary course of exchange the goods and services we receive from foreign nations must, in the long run, be paid for in goods and services furnished by America. Articles such as coffee, rubber, cocoa, jute, and tin must be obtained entirely from foreign countries, and many other articles, such as wool, hides, sugar, tropical fruits, and the like are imported extensively. There are also many manufactured articles that the American people have found it profitable to purchase from European countries. Without the importation of many commodities and articles the normal progress of our industries would be arrested, and the variety of articles available for domestic consumption would be seriously curtailed. Necessity, therefore, compels America to export sufficient commodities, either foodstuffs, raw materials, or manufactured articles, to pay for the goods and services furnished by foreign. peoples.