In order to enable her exporters to gain an advantage over their competitors,Germany uses the notorious “scrip mark”system,which is a compulsory subsidy to German exporters wrested from American and other foreign holders of German bonds.The system is simply this: foreign bondholders receive part of their interest in the form of scrip,which is redeemable only at the Gold Discount Bank in Germany at a discount of 50%.This scrip is then sold by the Bank at 57½%o of its face value,to the German exporters,who are thus enabled to quote bargain prices for their wares in the international markets.
American purchases of German goods in 1932 amounted to approximately $73,500,000,of which over $42,000,000 worth were in finished manufactured products,$20,000,000 in semi-manufactures and only $11,500,000 in raw materials (Report of Burean of Foreign and Domestic Commerce,1932).Their finished products,in the vast majority of instances,could have been purchased from our own American manufacturers and could have given employment to our own American labor.
It is true that our exports to Germany exceed our imports from that country. However,as President Roosevelt has pointed out (New York Times,Jan.25,1934,p.9), in arriving at the true balance of trade we must take into account the “invisible exports”payments accruing to Germany from tourist expenditures,remittances by immigrants,shipping services,insourance,etc.These items swell the figures of German exports to as point where our favorable trade balace,if any,is negligible.
There is no gainsaying the fact that trade relations are disrupted by an effective boycott.But we may seriously doubt whenther in the case of our trade with Germany,the boycott would be disadvantageous to America.The nature of German purchases here; the nature of American purchases in Germany; the unscrupulous methods of Germany in her competition with American manufacturers here and abroad; the direct benefits insuring to American capital and labor from a replacement of German products by those made in America; these factors may well cause a court to Iresitate in declaring that the interests of the United States are injuriously affected by the boycott, or that the supposed injury to trade is more important than the tremendous stake which American has in the preservation of democratic institutions and human rights.
(Next Article: Boycott Tactics Legal and Illegal.)
The Archive of the Jewish Telegraphic Agency includes articles published from 1923 to 2008. Archive stories reflect the journalistic standards and practices of the time they were published.
