High-Minded Dumping

Since most foreigners hotly resent the dumping abroad of German goods at below-cost-of-production prices, Economics Minister & Reichsbank President Dr. Hjalmar Schacht has moved with extreme wariness in setting up the 1,000,000,000 mark ($400,000,000) revolving fund to force German exports out upon the world.

In Germany last week the individual manufacturer or industrialist was forbidden to divulge how much he has been called on to contribute, forbidden to find out how much his keenest competitor is being assessed. Menaced with fresh Nazi warnings that there must be no grumbling, German industrialists big and small were paying up, but their disgruntlement was such that it could not be concealed. Privately they tipped off foreign correspondents that Economic Tsar Schacht's assessments are, in nearly all cases, heavy enough to absorb the harassed manufacturers' 1934 profits, and in many cases so heavy as to turn profits into deficits. Even firms notoriously in the red have been assessed and were paying up last week, as Tsar Schacht brusquely demanded that 100,000,000 marks be collected by June 15. Efforts to draw from the Ministry of Economics some explanation of how the $400,000,000. fund will revolve were met by bland assertions that it is covered by no law and hence must be considered an unofficial German movement of economic selfhelp. This explanation, German officials seemed to hope, may protect their Government from foreign charges that Germany has resorted to dumping as a weapon of national policy. So far as could be learned the procedure is as follows:

Mercedes Motors, for example, will supply Dr. Schacht evidence that it could sell 1,000 Mercedes rear-engine cars in the U. S., if it could cut the present Manhattan delivered price of $1,350 to perhaps $800. This it could do only if granted a subsidy out of the $400,000,000 fund. Should Mercedes be considered deserving in this case, it would get the subsidy.

How it would profit Germany to cut the export price on Mercedes cars or whatnot is explained by the fact that the subsidy would be paid in marks of which the German Government will always have plenty, whereas the cars would be paid for in dollars good anywhere on foreign exchange. With these dollars which, like all foreign money possessed by Germans, would be at the Government's disposal, necessary purchases could be made abroad of materials now urgently needed by Realmleader Hitler's fast expanding Army, Navy and Air Force. Last week in Berlin most businessmen agreed that the dumping fund was set up chiefly because German War Minister General Werner von Blomberg has been loudly complaining that he cannot get together a proper lighting force if obliged to equip it with German Ersatz (substitute) materials.

So far as U. S. citizens and their goods are concerned. U. S. consular officials in Germany inclined to believe last week that the revolving fund will be used not so much to dump in the U. S. as in countries with which the Fatherland has clearing agreements. According to the plausible secretariat of smart Dr. Schacht, nothing is farther from his high mind than dumping. He merely hopes to equalize the difference between the value of the German mark, which is relatively high because the mark has not been devalued, and the value of other currencies like the yen, pound and dollar, which have been forced down by devaluation.

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