30. TWO DOUBTFUL CLAUSES IN THE TARIFF ACT OF 1922 In addition to the group of provisions outlined in the previous subdivision, there are two other paragraphs in the Tariff Act of 1922 which may appropriately be kept in mind in the consideration of the question of equality of

treatment.

Paragraph 406 levies a twenty-five per centum duty on "boxes, barrels, and other articles" containing certain kinds of fruit; provided

That the thin wood, so called, comprising the sides, tops, and bottoms of fruit boxes of the growth or manufacture of the United States, exported as fruit box shooks, may be reimported in completed form, filled with fruit, by the payment of duty at one-half the rate imposed on similar boxes of entirely foreign growth and manufacture; but proof of the identity of such shooks shall be made under regulations to be prescribed by the Secretary of the Treasury.

There would seem to be ground for arguing that to levy a twenty-five per centum duty on boxes composed of wood originating outside the United States and manufactured in a country with which the United States has a treaty assuring to its products most-favored-nation treatment, and at the same time to levy a duty of twelve and one-half per centum upon similar boxes manufactured in another country out of American thin wood, constitutes a violation of the spirit and intent of that treaty and consequently a similar violation of the policy of Section 317. In either case the total value, the value upon which the differential duties are to be calculated, comprises not only a product of the United States (wood) but also a product of another country (a finished article produced by labor).1

1In regard to reimports of goods which have not been increased in value see Tariff Act of 1922, Section 314 (general) and Section 322 (automobiles exported for use of American Expeditionary Forces in the World War).

Paragraph 1453 relates to photographic film, especially moving-picture film. A reduced duty is allowed on the reimportation of films taken from the United States and exposed in another country by an American producer operating temporarily there in the course of producing a picture sixty per centum or more of which is made in the United States. The potential discrimination is against the added value resulting from the use of the films in making parts of pictures-which added value may be very great and would be the product of the country where exposure occurred.1

31. FORERUNNERS OF THE ELEVEN PROVISOS Attention has already been called to the fact that provisions penalizing the commerce of other countries for reasons other than discrimination against American commerce were not invented by the tariff makers of 1922. The first such provision in the tariff history of the United States is found in paragraph 218 of the Tariff Act of 1890, which reads as follows:

Sawed boards, plank, deals, and other lumber of hemlock, white wood, sycamore, white pine and basswood, one dollar per thousand feet board measure; sawed lumber, not specially provided for in this act, two dollars per thousand feet board measure; but when lumber of any sort is planed or finished, in addition to the rates herein provided, there shall be levied and paid for each side so planed or finished fifty cents per thousand feet board measure; and if planed on one side and tongued and grooved, one dollar per thousand feet board measure; and if planed on two sides, and tongued and grooved, one dollar and fifty cents per thousand feet board measure; and in estimating board measure under this schedule no de

1Compare Section 12 of the British Finance Act, 1922 (ch. 17, 12 and 13 Geo. v), as amended by Section 9 of the Finance Act, 1923 (ch. 14, 13 and 14 Geo. v).

duction shall be made on board measure on account of planing, tongueing and grooving: Provided, That in case any foreign country shall impose an export duty upon pine, spruce, elm, or other logs, or upon stave bolts, shingle wood, or heading blocks exported to the United States from such country, then the duty upon the sawed lumber herein provided for, when imported from such country, shall remain the same as fixed by the law in force prior to the passage of this act.1

Attention is directed to the fact that this clause, unlike the majority of the foregoing, makes the rate of duty for import into the United States dependent upon an export duty imposed by the country of origin. As such its object was, of course, to force the other country, because of its need or desire to have a favorable market for its products, chiefly raw materials, to permit their free export.

The Act of 1894 was quick to follow the example set by its predecessor. Paragraph 166, referring to lead, provided for a differential duty in case the country of origin levied an export duty on lead ore, lead in pigs, et cetera. Paragraph 608 levied a duty on salt, otherwise free, if from a country taxing the importation of salt from the United States. The next example was a similar provision referring to sulphuric acid (Paragraph 643). Paragrah 683 placed a duty on logs and various articles of wood, otherwise free, if from "any country which lays an export duty or imposes discriminating stumpage dues on any of them." The last clause, depending in part upon discrimination, is to be differentiated from the other provisions.

The Act of 1897 contained in Paragraph 393 a provision adding the amount of any export duty levied upon pulp wood to the import duty otherwise provided for wood pulp; Paragraph 396 penalized export duties upon wood pulp by

1Tariff Acts, pp. 385-386.

'Supra, subdivision 28.

increasing the duty upon printing paper imported into the United States; Paragraph 491 levied a duty of one-half of one cent per pound upon binding twine if from a country which taxed imports of American binding twine at any rate whatsoever; Paragraph 626 made petroleum dutiable in the amount of the petroleum import tax, if any, charged by the country of origin; Paragraph 675 made sulphuric acid dutiable if from a country imposing an import duty upon it.

The Act of 1909 contained in Paragraph 406 an extreme example of complexity in clauses of the kind under consideration. It imposed a duty on mechanically ground wood pulp, but admitted that product free when from countries that imposed no export restrictions upon such wood pulp, printing paper or wood for use in the manufacture of wood pulp. If export duties were charged, an import duty in like amount was to be added. Separate provision was made for chemical wood pulp.1 Other examples are found in Paragraphs 409 (printing paper); 476 (plows, et cetera); 507 (binding twine); 687 (sulphuric acid).

The Act of 1913 contained only three analogous clauses: Paragraphs 322 (printing paper); 581 (potatoes), and 644, which placed on the free list

Wheat, wheat flour, semolina, and other wheat products, not specially provided for in this section: Provided, That wheat shall be subject to a duty of 10 cents per bushel, that wheat flour shall be subject to a duty of 45 cents per barrel of 196 pounds, and semolina and other products of wheat, not specially provided for in this section, 10 per centum ad valorem, when imported directly or indirectly from a country, dependency, or other subdivision of government which imposes a duty on wheat or wheat flour or semolina imported from the United States.

Tariff Acts, p. 750.

These clauses with respect to potatoes and wheat are of especial

The Tariff Act of 1922, as has doubtless been observed, outdid its predecessors in respect to the number and importance of such clauses.

32. THE PROVISOS AND RELATIONS WITH CANADA

The products for which differential duties are prescribed by the eleven provisos of the Tariff Act of 1922, as well as by its predecessors, come chiefly from Canada, to which country the United States is legally under no most-favorednation obligations. But, irrespective of the legal effects of the provisos, the commercial consequences may be considerable. These discriminatory provisions necessarily stir up ill-will wherever their burden threatens to fall. They provoke retaliation. They seem to offer little if any countervailing advantage. They are to be regarded as distinctly regrettable and, as far as they go, they tend to create a suspicion that the United States has embarked upon a policy of trying to keep its own door closed tight, while at the same time endeavoring to force open the door to every other market.

The commercial relations between the United States and Canada ought to be particularly friendly. Canada consumes enormous quantities of American products. Potentially it is a vastly greater market. Yet, not content with imposing high duties that fall heavily upon the producers of that country and not regretful that the reciprocity1 the Canadians desire appears to be impracticable, this country here

interest because of the corresponding provisions in the Canadian tariff law (infra, subdivision 32). Potatoes were made free, but if from a country imposing a duty upon American potatoes, ten per centum ad valorem. Paragraph 322 (printing paper) was amended as to rates but otherwise re-enacted by Sec. 600 of the general revenue act of September 8, 1916.

1 See Appendix 10.