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Later he says, "Constitutional objections to the trade-agreements program by those who are not in sympathy with its objectives are not new." He then quotes the Ways and Means Committee, from its report in 1945, as saying in part:

“We consider that it is clear, on the basis of precedent and authority, that (1) no constitutional or other legal considerations require Senate ratification of trade agreements, and (2) the Trade Agreements Act involves no improper delegation of legislative power.”

Please note, Mr. Secrest, that the Ways and Means Committee was referring to the Trade Agreements Act and not to the General Agreement on Tariffs and Trade. The report quoted from was made in 1945. The general agreement was negotiated in 1947. My objections were to GATT and not to the previous bilateral agreements. The quotation from the Ways and Means Committee was therefore beside the point. GATT is something quite different from a mere agreement in which duty reductions are made. It has in it the makings of a super state exercising great powers over our trade and related economic matters. I said nothing about the constitutionality of the Trade Agreements Act, as might be inferred from Mr. McFall's defense; but referred to GATT, to which the quotation from the Ways and Means Committee does not apply.

Only now do we come to the State Department's real answer to my objections to GATT, After saying that my other objection to GATT is that it involves review by other countries of congressional and Executive action, Mr. McFall says that in order to appraise this argument it is necessary to consider how the general agreement (GATT) operates.

He says, “It must be emphasized that the parties to the agreement cannot overrule acts of Congress or of the Executive." This was not precisely what I had alleged in the radio address, but comes to about the same thing.

How does the State Department explain away this charge?

In the radio address were cited two instances in which GATT reviewed sovereign acts of the United States: (1) the action by which the United States restored the duty on certain fur-felt hats, after recommendation to the President by the Tariff Commission that this be done; and (2) our proposal to withdraw our trade agreement with Czechoslovakia.

The State Department, in its letter to you, says:

*On the other hand, the contracting parties to the agreement do have the right to consult with any contracting party concerning the discharge of its undertakings, and to seek compensation or take offsetting action because of the failure of any contracting party to carry out these undertakings.”

Mr. McFall (State Department) had just said, as already quoted : "It must be emphasized that the parties to the agreement cannot overrule acts of Congress or the Executive.” Then he says the parties do have the right to consult.

Obviously, the State Department is trying to show just how an agreement is not really an agreement. "Moreover,” says Mr. McFall, “any contracting party can withdraw from the agreement on 60 days' notice." All this represents an attempt to show that GATT exercises no power of review, and that it merely exercises the right to consult.

Evidently GATT is a very flimsy thing, without much meaning and certainly without teeth-a piece of paper that can be flouted at will by any one of the contracting parties. Or is it?

This may not exactly be the case; for a little later, in his reference to the Fur-Felt Hat case, Mr. McFall states:

"The working party (which had been appointed by GATT at the instance of Czechoslovakia to review the actions of the United States) found that there were no conclusive evidence that other action taken by the United States Government under article XIX constituted a breach of its obligations under the general agreement.”

Is it not strange that the "right to consult” onfers upon this international body the right to appoint a working party which makes an elaborate analysis of United States action in the light of article XIX of the general agreement (GATT) to determine what? Whether we have consulted properly? Whether we have been discourteous? Not exactly.

The McFall letter says:

“The working party found that there was no conclusive evidence that the action taken by the United States Government under article XIX constituted a breach of its obligations under the general agreement."

"A breach of its obligations" sounds somewhat more formidable than the "right to consult.” That it is actually regarded much more seriously even by the State Department will become obvious later. At this particular point Mr. McFall, still apparently speaking for domestic consumption, says:

“ If the contracting parties had found otherwise (i. e., that the United States had breached its obligations), the United States would, as a matter of policy, have wanted to reexamine its action in the light of such a finding, but whether the other contracting parties agreed with the action or not, the United States would still have had the power to continue its action if it wished to.'”

In another place Mr. McFall observes:

"If these provisions (i. e., the right to consult, to take offsetting action, and the right to withdraw from the agreement) constitute 'review' in any objectionable sense of the word, then it follows that most international undertakings among nations, including those of a bilateral character, are objectionable and should be dissolved."

In other words, the General Agreement on Tariffs and Trade (GATT) is just an innocent international agreement calling for consultation before taking action under it. No harm done; no real commitments involved; and nothing really serious intended. Merely the “right to consult."

That there are hidden teeth somewhere in the agreement which give it more bite than the mere right to consult confers and which give substance to such words as “a breach of its obligations," quoted above, comes to light later in the State Department's letter. This happens in Mr. McFall's observations about the second instance of GATT review of official United States action, cited in my radio address.

Involved in this instance was United States withdrawal from its trade agreement with Czechoslovakia, as required by the Trade Agreements Extension Act of 1951 (Public Law 50, S2d ('ong., sec. 5). In my radio address I had said that even though withdrawal from the Czech agreement was required by an act of Congress, signed by the President, we were not free to do so without taking the matter before GATT. I asked why the State Department had found it necessary to go to Geneva when she was already under instruction by Congress to act. Answering my own question, I said that she went to Geneva not for original authority but for confirmation of the authority that had already been voted by our Congress. That this procedure was recognized by the State Department follows from the fact that before acting they did lay the proposal before GATT. Mr. Mo-Fall says:

"In the other instance of 'review' cited by Mr. Strackbein, the United States itself requested the contracting parties to terminate United States obligations to ('zechoslovakia. Congress had provided in the Trade Agreements Extension Act of 1951 that the United States terminate 'as soon as practicable' concessions to Soviet-dominated countries."

In other words, by the State Department's own admission, the United States was in a position, because of our adherence to GATT, of having to request the contracting parties to sever our obligations to Czechoslovakia. Our Congress had spoken. It had required the President to suspend or withdraw the pact. The President had signed the act of Congress; but before carrying out this law, the State Department found it necessary to go to Geneva and ask in effect, "May we please do what Congress has instructed us to do?"

Was this merely consultation?
GATT voted on the question. It sustained the United States a second time.

If we were willing to abide by these decisions when they favored us, what will it make of us if we refuse when they go against us?

The State Department's letter lets us know what they themselves say. Figuratively, the cat has tired of playing and is now ready to dispose of the mouse. Says Mr. McFall :

"Respect for international undertakings in the case of Czechoslovakia, as in the case of termination of our bilateral commercial agreement with the U. S. S. R., required that certain procedures be observed in accomplishing the termination."

The teeth are beginning to show, but it is necessary to look closely. "Certain procedures" must "be observed," Mr. McFall says. These procedures, however, include the right of the other member nations of GATT to vote us down, to deny our petitions or to sustain those who complain against us. Remember, Mr. Secrest, that while "It must be emphasized that the parties to the agreement cannot overrule acts of Congress or of the Executive," the contracting parties to the agreement "do have the right to consult." This right of consultation includes these certain procedures that contain the quite effective power of review.

What would have been our position had we not consulted in the two cases

mentioned and had we not followed the decisions of GATT? The State Department has rather definite ideas on this. In his letter, Mr. McFall says:

"To have ignored these undertakings (read 'obligations') would have given the Soviet bloc a strong propaganda theme against the United States."

Again, farther on, in assessing the possible effect of a withdrawal by the United States from GATT, he says:

“The blow to our allies would not be economic alone. In other countries, the inconsistency of our giving with one hand, through the Mutual Defense Assistance Program and through point 4, while taking away with the other would raise fundamental doubts regarding the basis of our leadership in the free world. These developments would affect both the ability and the willingness of our allies to make the sacrifices and readjustments that we are urging upon them.”

There you have the sanctions of GATT.

It is precisely because we should honor our agreements that membership in GATT is a very serious matter. It is precisely because we should carry out our obligations and not flout them that GATT represents something far beyond the right to consult. Either we enter our international agreements in good faith, with full intention to meet our commitments, or we play fast and loose in our international relations. Which position does the State Department occupy? When they say that we are bound by GATT, that we can withdraw, what sort of picture do they mean to draw of Uncle Sam in his conduct of international affairs? Do they wish us to stand by GATT when GATT supports us but to walk out if GATT goes against us?

If not, then GATT exercises a power of review as tight as any. Yes, we can walk out. Certainly, we can behave execrably; we can be international heels. Is that the significance of the State Department's argument?

If not, then we are indeed bound by GATT. This was what I assumed in the radio address, because I assumed that Uncle Sam honors his agreements. I still assume it. I assume that when we give our word in an international agreement we mean to carry it out in good faith and to abide by the rules and procedures and by the decisions arrived at in accordance with those procedures, whether they go in our favor or against us. That is why we should be careful of the kind of agreement we enter into; and the best way to be careful in these foreign agreements is to follow the constitutional processes.

Under these circumstances it is clear that through our entry into GATT we have by an international agreement de facto bestowed the right of review by an international body over official acts of our Congress and our Executive.

At no point have I said, Mr. Secrest, that we should never do this. We have done it in other spheres within certain limitations. What I have said is that the State Department in taking us into GATT has done so outside the treaty-making powers of the Executive and the Senate, and without specific legislative authority. I pointed out in my address that before we entered the United Nations, Congress passed the United Nations Participation Act, approved December 20, 1945. Also before joining the so-called World Court, the Senate ratified our action by passing a resolution of adherence, setting forth the conditions of our acceptance of its jurisdiction. Other instances could have been cited, among them membership in the International Labor Organization, the way to which was paved by a resolution of the Seventy-third Congress.

The General Agreement on Tariffs and Trade lacks such legislative ratification in those of its parts that go beyond section 350, previously mentioned, which is the only legislative source of authority that underlies the trade-agreements program. Mr. McFall bases authority for the broader provisions of GATT on the Presidential power to conduct foreign relations.

However, the Constitution grants to Congress the power "to regulate commerce with foreign nations" (art. 1, sec. 8).

The upshot is that according to the State Department the Executive may go beyond the delegated power provided in the section 350 amendment of the Tariff Act of 1930 (the Trade Agreements Act) to enter into trade agreements for the 50-percent adjustment of the tariff and a few related steps. For this enlarged power the President, according to the State Department, needs no additional authorization from the Congress or from the Senate alone.

This places the State Department, as the right arm of the Executive in conducting foreign relations, in the position of making broad international executive agreements which in the usages, practices, and realities of international relations fritter away our national sovereignty just as surely and effectively as would a treaty concurred in by the Senate. Since a treaty may at least be denounced

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and abrogated, there is recourse; while in the exercise of the alleged powers of the Executive in international relations, there is none.

The entire effort of the State Department has trended toward the complete elimination of any legislative voice in the regulation of our trade. Neither GATT nor its ill-fated forerunner, the International Trade Organization, contemplated responsiveness to the producers and workmen of this country and their interests by these governing international bodies. The elimination of this responsiveness, so specifically and elaborately guarded in the Constitution, was arranged through the one-vote mechanism (whereby the United States had the same vote as other countries in the international bodies), and through the complete domination of the field by the Executive.

It was on these grounds that I concluded that we should withdraw from GATT and thus bring the regulation of our foreign commerce back to this country, where it belongs, if the people of this country are to continue to exercise control over the acts of their Government.

Thank you for this opportunity to make a reply to the State Department's letter of comment on my attack on GATT. Sincerely yours,

0. R. STRACKBEIN. Senator HENDRICKSON. You have said very little about the treatymaking power, the treaty provisions. I assume from your concluding statement that you are in favor of the basic resolution that is before us both as to treaties and executive agreements ?

Mr. STRACKBEIN. I am in favor of the principle of the resolution. I have largely confined myself to showing the need from practical experience of an amendment to the Constitution, or legislation, or both, which will clarify this field and prevent the occurrence of such things as I have described. I am not going into the mechanics of tne resolution itself, and I have not. I had thought that in the amount of time I had I would do better by confining myself to these practical examples of what has actually gone on as a basis and as a justification of the resolution.

Senator HENDRICKSON. Have you examined the resolution of the American Bar Association ?


Senator HENDRICKSON. You would not be prepared to discuss that at all ?

Mr. STRACKBEIN. I would be very glad to look it over.

Senator HENDRICKSON. I would appreciate it if you would look it over and let me have the benefits of your comments by a letter to the committee.

Mr. STRACKBEIN. I will do that.

Senator HENDRICKSON. Thank you very much. You have been very helpful.

(Whereupon, at 4:50 p. m., the hearing was recessed, subject to call.)




Washington, D. C. The subcommittee met, pursuant to recess, at 2:25 p. m. in room 424, Senate Office Building, Hon. Robert C. Hendrickson presiding.

Present: Senator Hendrickson.
Also present: Wayne H. Smithey, professional staff member.
Senator HENDRICKSON. The hearing will be in order.

I understand we have with us this afternoon Mr. McGrath, who is planning to make a trip very shortly, that is, within a few hours, to the Geneva Convention. He wants to get away. Is Mr. McGrath here?

Mr. MCGRATH. Yes, sir.

Senator HENDRICKSON. We are glad to welcome you here. Will you state your name for the record, your address, and then proceed in your own way. STATEMENT OF W. L. MCGRATH, PRESIDENT, THE WILLIAMSON

HEATER CO., CINCINNATI, OHIO Mr. McGrath. Thank you kindly, Senator. I appreciate the opportunity that the committee affords me to be present here today. My name is William L. McGrath. I am president of the Williamson Heater Co. of Cincinnati, Ohio.

For the last 4 years I have been a member of the United States employer delegation to the International Labor Conference, Geneva, Switzerland. I am about to leave again to attend the thirty-fifth conference of that organization.

Senator HENDRICKSON. Sometime today or tomorrow, I understand.

Mr. MCGRATH. I am having difficulty at the moment because they are canceling out the flights due to the oil shortage.

Senator, I have tried to boil down in a résumé form, as briefly as possible, 4 years experience as participant and as observer of the International Labor Conference. If I were to present the story it would take 38 pages to do it. I have brought the 38 pages along. I think these 38 pages are important from this standpoint.

Senator HENDRICKSON. Are they in such shape that they can be left with the committee for study rather than make a bulky record of them?

Mr. McGrath. Yes, sir, they are in such form and they are bound together. What I thought was important was this:

I attended the thirty-second conference of the International Labor Organization in 1949. I thought that it was important to make a

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