The Other Half

The stated policy of the U.S. on cartels is "down with 'em." In the opinion of many a U.S. businessman, this uncompromising attitude is only half a solution. It leaves unsolved the problem of developing a booming postwar trade with cartel-minded nations. Last week, the potent National Foreign Trade Council, Inc., whose 700 members expect to do the bulk of this trading, put out its own solution.

The National Foreign Trade Council, recognizing what many cartels have done to fix prices and control production to the detriment of consumers, would have the U.S. stand firm against cartels in home in dustry. But it would permit U.S. firms to make agreements with foreign cartels, require them to be filed with the Department of State. Unless the State Department found within three months that the agreement unreasonably restrained trade within the U.S., then the deal would be blessed by the Department.

In substance, the N.F.T.C. plan is simi ar to those advanced by such poles-apart individuals as Standard Oil Co. (N.J.)'s conservative chairman, Ralph W. Gallagher, and New Dealing Milo Perkins. What was new in the Council's plan was the implication that the time has come for Congress to clarify U.S. policy on cartels, rather than leave it to definition by liti ious Attorney General Francis Biddle.

The Council's recommendations were based on an exhaustive 130-page survey of foreign trade, sparked by the Council's white-haired, bespectacled president, Eugene Peeples Thomas, onetime vice president of U.S. Steel Corp.

Where's the Meeting Ground? Adept at winding his way through the jungle of international trade laws, Thomas wanted to arrive at a common meeting ground for U.S. free enterprise and cartels. He discovered little to comfort free traders. His survey found no hope that the U.S., despite its mighty economic power, could force an agreement from other nations to end cartel-dealing in the postwar trade world. Instead it concluded that the cartelization of European industry, compulsory in some countries in prewar days, would not be changed by the peace. In fact, there may be even greater cartelization and concentration of industries.

Under these circumstances, the Council concluded: attempts to use the antitrust laws to reform foreign industries (as Attorney General Biddle has been trying to do) would penalize only those firms subject to U.S. laws and jeopardize the U.S. position in postwar international trade.

In recommending registration of agreements, the Council would not clip any anti-trust laws. U.S. companies could still be prosecuted if they failed to drop agreements which the State Department frowned on. And the State Department could revoke its approval of an agreement, any time it wanted. But U.S. corporations and businessmen would no longer be harried by antitrust laws, as they sometimes are now: they could not be indicted, under any "new" interpretation of the antitrust laws, for something they thought was perfectly legal at the time they did it.

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