Roundest Robin

International

An odd dozen commonplace-seeming men waited simultaneously one morning last week in the several London offices of the world's principal news agencies. Their cards betokened them representatives of an advertising firm. When they were admitted, they laid before thunderstruck news executives a round robin signed by over 100 of the world's most potent financiers, calling upon European nations to remove their tariff hindrances to international trade.

Signatories to this remarkable document:

U. S. John Pierpont Morgan; Albert H. Wiggin, President, Chase National Bank, Manhattan; Melvin A. Traylor, President, First National Bank, Chicago; John J. Mitchell, President, Illinois Merchants Trust Co., Chicago; Thomas N. Perkins, Member, Reparations Commission; Gates W. McGarrah, Chairman, Mechanics and Metals National Bank, Manhattan.

Other Nations: Montagu Collet Norman, Governor, Bank of England;* Dr. Hjalmar Schacht, President, German Reichsbank;/- Nicola Pavoncelli, Chairman, Bank of Italy;** and the presidents of the state banks of the following countries with a large contingent of financiers from each: Austria, Belgium, Czechoslovakia, Denmark, the Netherlands, Hungary, Norway, Poland, Sweden, Switzerland.

Despite the arch-protectionist predilections of Frenchmen, the manifesto was signed by M. Rene Laederich, Regent of the Bank of France, and by eight other potent French financiers.

Flurry. Who drafted this unprecedented document? Its purveyors refused to say. The hundred odd famed signatures made it white-hot news. Fearful of lagging behind, the great news agencies tarried not to investigate but broadcast this roundest of round robins as fast as cable relays could click. Local editors in every capital hastily picked a financier of foreign nationality as the documents' author. British editors picked signatory Hjalmar Schacht, President of the German Reichsbank. Germans favored signatory Montagu Norman,*** Governor of the Bank of England. Frenchmen were sure that signatory John Pierpont Morgan was at the bottom of the woodpile.

President Coolidge, unable for a time to obtain authentic information, apparently suspected that indiscreet Republican bankers were casting aspersions upon Republican protectionism for their own nefarious ends. The President thereupon trenchantly reminded the nation that those who lend money are ever anxious for international free trade, but that the Republican party stands ready to defend those who earn money in the U. S. with its tariff shield.

The Round Robin was entitled: A Plea for the Removal of Restrictions upon European Trade.

Text, in part:

We desire, as business men, to draw attention to certain grave and disquieting conditions which, in our judgment, are retarding the return to prosperity. . . .

The break-up of great political units in Europe dealt a heavy blow to international trade. Across large areas, in which the inhabitants had been allowed to exchange their products freely, a number of new frontiers were erected and jealously guarded by customs barriers. Old markets disappeared. Racial animosities were permitted to divide communities whose interests were inseparably connected. . . .

Too many states, in pursuit of false ideals of national interest, have imperiled their own welfare and lost sight of the common interests of the world by basing their commercial relations on the economic folly which treats all trading as a form of war.

There can be no recovery in Europe till politicians in all territories, old and new, realize that trade is not war but a process of exchange, that in time of peace our neighbors are our customers, and that their prosperity is a condition of our own wellbeing. If we check their dealings, their power to pay their debts diminishes and their power to purchase our goods is reduced. Restricted imports involve restricted exports, and no nation can afford to lose its export trade. . . .

We wish to place on record our conviction that the establishment of economic freedom is the best hope of restoring the commerce and the credit of the world.

Source. Thomas W. Lamont, potent Morgan partner, not a signatory, declared that the manifesto has been in circulation among international financiers for some time. Wall Street supplied the rumor that it took final form when Montagu Norman, Governor of the Bank of England, and Dr. Schacht, President of the German Reichsbank, conferred with Benjamin Strong, Governor of the Federal Reserve Bank of New York, at Antibes, French Riviera (TIME, Aug. 30). Of these three fiscal tycoons only Dr. Schacht would comment last week: "The manifesto is connected closely with the recent conference of German and British industrialists in England [TIME, Oct. 18] and is the result of international negotiations."

Significance. President Mitchell of the Illinois Merchants Trust Bank, a signatory, said: "The manifesto is not intended to have any reference to the United States." Apparently this view was shared by other U. S. signatories who pointed to the title of the manifesto which explicitly restricts its application to Europe. Public opinion seemed inclined to let the document drop as a mere "pious plea" like those often uttered for "peace," "disarmament" and what not.

As everyone knows, the international tariff reform most desired by businessmen is the stabilization of tariff schedules. At present they are jumped and lowered so frequently by many of the minor European states that traders find their dealings menaced by uncertainties not unlike those encountered when national currencies are fluctuating rapidly. Instances have occurred in which minor European states have deliberately jumped or lowered their tariffs on the occasion of a single large shipment across their frontiers, readjusting the tariff scale again when the shipment had passed. If such sharp practice could be eliminated and the attitude of tariff barriers fixed, international commerce would at least be able to adjust itself to a definite scale of "necessary evils." Paradoxically, though last week's manifesto seemed destined to produce no real effect, it caused marked temporary fluctuations on both the New York Stock Exchange and the Berlin Bourse.

*Plus Viscount Inchcape, Chairman, P. & O. Navigation Co. ; Henry Bell, Director Lloyd's Bank, Ltd. ; Sir Josiah Stamp, President, London Midland and Scottish Ry. ; Lionel Nathan de Rothschild of N. M. Rothschild & Sons; and 36 other equally potent financiers.

/- Plus General Kommerzienrat ("Councilor of Commerce") Doktor Karl Bosch, Chairman, Chemical Trust, Heidelberg; Geheimrat ("Privy Councilor") Felix Deutsch, Chairman, General Electric, Berlin; and seven more fiscal potentates.

**Plus Antonio S. Benni, President, Fascist Confederation of Industries; G. Agnelli, President, F. I. A. T. Motors; and seven additional bankers and financiers.

***A soldier in his youth, he won the D. S. O. during the South African War of 1900-1901. Later, having gone into trade, he became actively associated with the Bank of England during the World War. Since 1920 he has been successively elected Governor of the Bank each year. Thus he has served the longest term of any governor in the Bank's history, and is known at present as one of the most acute and farsighted of international financiers. Britons will long remember that it was during his regime that the pound was at last put back on a gold basis (TIME, May 11, 1925).