THE INVISIBLE TARIFF - INTERNATIONAL ECONOMIC RELATIONS By Percy W. Bidwell American newspaper headlines on March 19, 1939, announced that Mr. Henry Morgenthau, Secretary of the Treasury, had added to the import duties on German goods additional or countervailing duties equal to 25 percent of their value. Millions of Americans, without understanding the technical basis for the Secretary's action, heartily endorsed it. They interpreted it as an "action stronger than mere words" whereby President Roosevelt was showing his disapproval of German aggression in central Europe. Tariff news of this sort abounds, nowadays. The President is urged to use latent tariff powers to dissuade Japan from closing the Open Door in China. Puerto Rican sugar mills protest Secretary Wallace's cut in their import quota allotment. American exporters, suffering under Argentina's discriminatory exchange control, demand relaxation of our embargo on Argentine meat. American nurserymen ponder the effects on their business of the proposed revision of the Plant Quarantine Act. State legislatures in New York and Massachusetts, not satisfied with federal marksof-origin requirements, debate new ways to make sure that no consumer can purchase Japanese or German goods without knowing it. New state and federal "Buy-American" laws restrict the expenditure of hundreds of millions of public money to the purchase of domestic goods.
Matters such as these were not the stuff of the traditional American tariff problem. From the Civil War until the end of the century, "tariff discussion" meant either the consideration of the general issue of Protection vs. Free Trade, or else the question whether the rate on a particular commodity, sugar or raw wool, was too high or too low. These were matters for Congress, not for administrative officers, to decide.
by months of public discussion. Meanwhile, there was arising a second tariff structure, a comprehensive system of administrative controls over import trade. Attracting much less attention in the public press, rarely debated in Congress, and never the subject of discussion by women's clubs or business men's forums, the invisible tariff has spread its intricate network over an ever-increasing area of our foreign trade. Today, administrative measures are more comprehensive than the visible tariff, since they affect goods which are on the free list as well as those which are dutiable; they are more effective since they make use of quotas and embargoes as well as tariff duties; they can be put into operation more promptly, since they do not need to wait upon discussion in legislative assembly. It was a customs lawyer who, appraising in 1922 the proliferation of administrative control of imports, shrewdly remarked, "Let me write the Administrative Act and I care not who fixes the rates of duty." In general, this book deals with those restrictions and prohibitions on American import trade which are not found in the formal schedule of tariff rates. They are found in the administrative provisions of the Tariff Act of 1930, as amended in 1938, in customs regulations, in the decisions of customs courts, in regulations of various bureaus and divisions of the Department of Agriculture, the Bureau of Narcotics and other administrative agencies. No work of the limited scope of the present monograph can pretend to present a complete picture of all these varied and complex measures. They are too numerous and, besides, the picture is constantly changing as new orders are issued and old ones revoked. Extra-legal restrictions on import trade such as consumers' boycotts and the refusal of union labor to handle imported goods fall outside the scope of the book because of limits of time and space.