nomic aid to foreign governments might be reduced. Fourth,
the position of the United States as leader of the non-communist
world would be strengthened. And finally, there would be a
larger quantity of goods than at present to share among the
nations of the world.
METHODS OF ACHIEVING TRADE POLICY OBJECTIVES
Now that we have examined the consequences of alterna-
tive trade policies, let us turn briefly to the means of achiev-
ing trade policy objectives. Tariffs or other trade restrictions
can be altered either on a unilateral basis or by means of
bilateral and multilateral trade agreements. Prior to 1934, this
country operated largely on a unilateral basis; that is, we raised
or lowered our tariffs without consulting other countries. In
recent years, however, United States tariffs have been reduced
as a result of reciprocal trade agreements with individual coun-
tries and multilateral agreements involving many countries.
Bilateral trade agreements. In 1934, the United States
first began experimenting with bilateral trade agreements.
Under the Reciprocal Trade Agreements Act of 1934, the
President was given authority to negotiate tariff reductions with
other countries. Congress has authorized the continuation of
this program in modified form seven times since 1934. The
most recent authorization extends to June 1953. Under the
original Trade Agreements Act, the maximum tariff reduction
that representatives of the United States could grant on any item
was limited to 50 percent of the tariff rate existing on that
item in 1934. Since the end of World War II, Congress has
authorized a further reduction of not more than 50 percent
of the rates existing in January 1945. Authority has thus been
granted for total tariff reductions of up to 75 percent of those
in effect in 1934. Reductions in United States rates are given
in exchange for reductions in tariff rates by foreign countries.
The actual negotiation of a trade agreement is carried on by
a special State Department staff which is advised by a com-
mittee consisting of representatives designated by the Secre-
taries of Agriculture, Labor, Commerce, Defense, and other
government agencies.
Between 1934 and 1945, the United States concluded recip-
rocal trade agreements with over 25 countries including Canada,
England, France, Switzerland, and most of the Latin American
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