Message to Congress on Assistance for Other American Republics in Marketing Surplus Products.

To the Congress:

As a result Of the war in Europe, far-reaching changes in world affairs have occurred, which necessarily have repercussions on the economic life both of the United States and of the other American Republics. All American Republics in some degree make a practice of selling, and should sell, surplus products to other parts of the world, and we in the United States export many items that are also exported by other countries of the Western Hemisphere.

The course of the war, the resultant blockades and counter blockades, and the inevitable disorganization, are preventing the flow of these surplus products to their normal markets. Necessarily this has caused distress in various parts of the New World, and will continue to cause distress until foreign trade can be resumed on a normal basis, and the seller of these surpluses is in a position to protect himself in disposing of his products. Until liberal commercial policies are restored and fair-trading on a commercial plane is reopened, distress may be continued.

I therefore request that the Congress give prompt consideration to increasing the capital and lending power of the Export-Import Bank of Washington by $500,000,000, and removing some of the restrictions on its operations to the end that the Bank may be of greater assistance to our neighbors south of the Rio Grande, including financing the handling and orderly marketing of some part of their surpluses.

It is to be hoped that before another year world trade can be reestablished, but, pending this adjustment, we in the United States should join with the peoples of the other Republics of the Western Hemisphere in meeting their problems. I call the attention of Congress to the fact that by helping our neighbors· we shall be helping ourselves. It is in the interests of the producers of our country, as well as in the interests of producers of other American countries, that there shall not be a disorganized or cutthroat market in those commodities which we all export.

No sensible person would advocate an attempt to prevent the normal exchange of commodities between other continents and the Americas, but what can and should be done is to prevent excessive fluctuations caused by distressed selling resulting from temporary interruption in the flow of trade, or the fact that there has not yet been reestablished a system of free exchange. Unless exporting countries are able to assist their nationals, they will be forced to bargain as best they can.

As has heretofore been made clear to the Congress, the Export-Import Bank is operated by directors representing the Departments of State, Treasury, Agriculture and Commerce, and the Reconstruction Finance Corporation, and is under the supervision of the Federal Loan Administrator, so that all interested branches of our Government participate in any loans that are authorized, and the directors of the Bank should have a free hand as to the purposes for which loans are authorized and the terms and conditions upon which they are made.

I therefore request passage of appropriate legislation to this end.