Ban on Exports

U.S. exporters, just getting back on their peacetime feet, were knocked to their knees again last week. Civilian Production Administrator Jack Small admitted that the U.S. will limit export of hundreds more scarce articles. (Tinplate, autos, etc., are already under export quotas.)

Since the end of the war CPA has been faced with the problem of domestic v. foreign demand for goods. While OPA lived, the problem was minor. Ceiling prices on exports left too small a margin of profit to suck any large amount of goods away from the domestic market. But with ceilings off, CPA saw trouble ahead. Most world commodity prices are 25% to 100% higher than those in the U.S. There was little to prevent nations with abundant dollar exchange from buying, at fantastic prices, the goods Americans themselves were still short of. So CPA plans to permit an increase in exports only as U.S. production increases. Under CPA's export formula, manufacturers would be permitted to ship scarce articles, chiefly durable consumer goods, building materials and farm equipment, either in the same proportion as in the first half of 1946, or according to a fixed percentage of their total sales.

CPA's plan brought a loud squawk from the Department of Commerce's Office of International Trade Operations. OIT, which would have to administer the CPA plan through export-license control, hated the thought of curbing foreign trade at a time when the U.S, was asking the rest of the world to relax trade restrictions. (Commercial exports in May were $649 million, highest since January 1921.) But there had been no boom since OPA's death. If a boom started, OIT could clamp on controls in 24 hours. In effect, CPA was turning on the hose before the fire started. But CPA was bulling its plan through anyway. It intended to make doubly sure that there would be no fire.

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