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non-tariff variety) on U. S. auto exports.
Japanese Quotas. The U. S. has pinpointed 38 categories of U. S. industrial and agricultural exports that are impaired by Japanese quotas which since 1963 have been inconsistent with the rules of the General Agreement on Tariffs and Trade. We are currently attempting to achieve the removal of these quotas.
-- Tobacco.
The European Community proposes changes in its regula- tions on tobacco which would harm U. S. tobacco exports. Tobacco interests and government are trying to modify these regulations.
All of these specific commercial objectives could suffer as a result
of U. S. textile negotiations. On one hand political pressure to negotiate
"voluntary" quotas will make foreign nations much less willing to give us
what we want in the above areas. On the other, it will encourage foreign
countries to take new protectionist steps. Legitimate, important U. S..
trade objectives will be subordinated to a political arrangement with the
U. S. textile industry which cannot be justified on economic grounds.
"Sixth, historically, "voluntary" quotas have tended to become
formalized in rigid mandatory ones. The voluntary oil import program began
as a voluntary one, as did the present cotton textile quota system.
Seventh; the "voluntary" approach deceptively hides the costs of the
quota, both to the economy and to our international political relations.
The main reason posed for voluntary quotas is that they avoid the need for
paying compensation or facing retaliation by foreigners. This is simply
illusory. As pointed out above, U. S. interests will indeed pay, and pay
dearly, for "voluntary" textile quotas.
Finally, it is at best inappropriate that the U. S. Government
should be the catalyst for international combinations of economic interests
whose purpose is to restrain trade and impair competition.
By Robert Vastine.
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