Attack on the Randall Report

After a careful study of the Randall Report on foreign trade, a group of 17 top economists condemned it in a pamphlet published last week for its "want of basic philosophy and for its failure to assert American leadership or to enlighten the American people as to their international responsibilities and opportunities. [It is] not a document from which the nation could derive inspiration."

The views of the critics, who had gathered at Princeton University, came out as President Eisenhower prepared to ask Congress to make tariff changes in line with the report's recommendations.

While admitting that it was "a better report than Congress itself would write," the economists found the Randall Report "badly compromised" by Steelman Clarence Randall's efforts to appease the protectionist wing of his Commission on Foreign Economic Policy. The report failed to make it clear that "American consumers and producers [would] gain from freer trade and larger imports."

Among the charges that the Princeton critics leveled against the report was that, in keeping with its general timidity, it treated the "dollar gap" as the basic problem, and closing the gap as the solution. By doing so, it inadvertently gave aid and comfort to protectionists, who now argue that tariff reduction is unnecessary because the dollar gap is already closed (see chart). Data in the Randall commission's own recently published staff papers show that in 1953 U.S. imports ($17 billion) actually outran U.S. nonmilitary exports ($16.9 billion). But the dollar gap closed in 1953 only because foreign countries slashed their imports from the U.S., apart from military aid, by more than $1 billion. And the Randall commission staff itself said that a gap "of substantial size undoubtedly would reappear" if the rest of the free world took down its barriers to imports from the U.S.

The economists at Princeton argued that U.S. trade policy should not aim at merely bringing U.S. imports into a statistical balance with exports. It should aim at an import level high enough to enable other nations to pay for vastly increased U.S. exports. In short, as the economists saw it, the Randall Report aimed too low.

This file is automatically generated by a robot program, so reader's discretion is required.