611.003/2280
The Ambassador in France (Edge) to
the Secretary of State
Paris, July 3, 1930.
[Received July
14.]
No. 676Sir: The latest incident in connection with the
French protests and criticisms of the new tariff bill is a rather
disquieting letter I received yesterday from M. Flandin, the French
Minister of Commerce, in direct charge of tariff and customs matters. I
am enclosing a copy and translation of his letter, together with a copy
of my reply.
As M. Flandin indicates, and as I have already advised the Department in
previous despatches, he has been very helpful in preventing actual
legislative reprisals on the part of the French Parliament. He clearly
suggests, however, in the letter enclosed, that if raises, particularly
on laces, which furnished such an acute situation here, are contemplated
by the Tariff Commission, he will be helpless in his efforts to prevent
unfortunate results.
I am drawing this specially to the attention of the Department as I feel
it is of such importance that some consideration should be given to this
matter if a possible tariff war is to be prevented. It is only necessary
to go back to the French motor tariff legislation to
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realize that if the lace schedule, for
instance, should be raised above existing law, it would probably be a
signal for retaliation all along the line. I am presenting the situation
as it apparently exists on this side and have the honor [etc.]
[Enclosure 1]
The French Minister of Commerce (Flandin) to the American Ambassador (Edge)
My Dear Ambassador: I read with surprise,
in this morning’s “La Journée Industrielle,” the following news item
dated Washington, July 1st:
“The Senate has voted Mr. Bingham’s resolution ordering the
Tariff Commission to make an investigation into the cost of
production in the United States and abroad of laces, various
fabrics, etc.”
You know with what calm I set out to study the situation created for
French economy by the publication of the new American customs
tariff, nor are you unaware that I have encountered great difficulty
in having my point of view shared in parliamentary circles: many
representatives of agricultural and industrial circles demanded
purely and simply that, as regards American imports, the general
tariff be substituted for the minimum tariff.
If the item quoted above, destroying the happy effect of your recent
efforts, should be confirmed, I fear I should not be able any longer
to resist the pressure being brought to bear against me.
Knowing how much you yourself are endeavoring to reach a conciliatory
solution, I wanted, my dear Ambassador, to inform you, in a strictly
friendly and private way, of the unfortunate repercussion on French
opinion of the decision of the Senate, and beg you to believe in my
most friendly sentiments.
[Enclosure 2]
The American Ambassador (Edge) to the French Minister of Commerce (Flandin)
My Dear Minister: I have your letter of
July 2nd and hasten to reply thereto. At the outset, permit me again
to emphasize the deep appreciation I feel for the generous and
helpful cooperation you have given in your desire to alleviate
criticism of the new tariff.
I am of the opinion that you are unnecessarily disturbed over the
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reported action of the
United States Senate directing the Tariff Commission to investigate
production costs of laces, cloths, etc. It is now very simple under
the new law to obtain a cost of production investigation by the
United States Tariff Commission, and it can be obtained by a request
of the President, either House of Congress, or any interested party.
As you, of course, understand, the Tariff Commission is charged with
the responsibility of investigating production costs either for the
purpose of raising or lowering duty to a maximum of 50% over or
under existing rates. Therefore, it is impossible to prevent
interested parties from asking the Commission to investigate tariffs
that may be considered too low any more than to investigate tariffs
that may be considered too high. The result of the Tariff
Commission’s inquiry must be based upon the actual facts,
irrespective of the wishes of the applicant.
The mere fact that Senator Bingham requested the Tariff Commission to
make this investigation is evidence that the rates as passed were
lower than some members of the Senate desired, thus demonstrating
that real consideration has been given to the French protests
against higher tariffs.
I had an informal conference yesterday with Ambassador Claudel at
which time I renewed my assurances given you and others that I would
gladly refer to the State Department requests for review by the
Tariff Commission of the new rates on any commodities in which
French exporters were particularly interested and where they
believed the rates unjust. Of course, I must repeat that the result
of such inquiries, whether the rates should be lowered, increased,
or remain as specified, is entirely a matter which must be
controlled by the facts adduced.
Both France and the United States have adopted a policy of
protection. The tariff is supposed to represent a fair estimate of
the difference between the cost of production in competing
countries. If the Tariff Commission finds the duty is greater than
the difference in cost, it naturally recommends a reduction in
tariff. If, on the other hand, it finds the tariff insufficient to
represent the difference in cost, it just as naturally recommends an
increase. I am afraid speculation as to the final recommendation of
the Tariff Commission would be resultless but I repeat that, based
on the well known formula and policy of protection, the reorganized
Tariff Commission is given increased authority over the old law to
reach decisions fair and equable to both countries.
With further assurances of my desire to cooperate in every possible
consistent manner, I beg to remain,
Sincerely yours,
