only 7.5 percent of the estimated total value of all movable goods produced in this country, according to the Department of Commerce, which gathers foreign trade statistics. It is impossible to image a situation where a complete embargo on goods to all of the foreign nations that conceivably might be at war at one time would amount to more than a tiny fraction of the cost in dollars and cents of the World War, or to more than a mere bagatele compared with the astounding cost and the inevitable loss of life that would result if we should allow cupidity for profits to snare us into another such war.

The actual direct cost of the World War up to date, as shown by Treasury Department records, is $41,765,000,000 or the equivalent of $60,000 for every day since Chirst was born, and that does not take into consideration future pension lists, veterans' hospitalization, and other left-over expenses. President Coolidge probably was not far wrong when he said that the World War will ultimately cost America $100,000,000,000. The total foreign trade of the United States in 1934, the last year for which statistics are available, was $2,100,000,000. Thus, it will be seen that if the entire foreign trade of the United States, including all exports of every kind and description, were entirely cut off for 47 years, the loss to the United States would still be less than our part of the financial cost of the World War, based on Mr. Coolidge's forecast, to say nothing of the heart-sickening toll of lives and the terrible burden of grief and misery caused by that war. Therefore, from every standpoint, economic no less than humanitarian, there is a genuine obligation resting upon us to write into the statutes a real neutrality law with teeth in it.

There are a few other points contained in the bill I have introduced that are not touched upon in other proposed drafts, as far as I am aware. One of these is a provision (sec. 5 of my bill) which directs the Secretary of Labor to deport aliens who come to this country and spread propaganda or engage in other activities that would interfere with America's position of neutrality "other than the legitimate exercise of free speech."

Mr. KLOEB. It has been our experience, I think, that as much damage, or, perhaps, more damage, is done to the neutral position of this country by loquacious citizens who happen to bear some title of the United States going to countries in Europe and expressing what they believe to be the position of the United States. Now, the gentleman is acquainted with discussions in the past on the question of free speech and the question of freedom of the press. You have here in your section 5 a provision for the deportation of any alien who spreads propaganda in this country.

Mr. LUDLOW. That is right.

Mr. KLOEB. What do you say as to the cessation of citizenship or the cutting off from office of an American, be he a member of Congress or otherwise, who goes over to Europe and attempts to speak the opinion of the United States in connection with a war that may be going on there?

Mr. LUDLOW. I will merely make this observation that it is exceedingly bad taste to do that, to say the least.

Mr. KLOEB. It would considerably discourage them, would it not, if we could do it in a law of this kind?

Mr. LUDLOW. Yes, but I am not prepared to say that I would advo cate forfeiture of citizenship in such a case. I believe this sort of activity-I am referring now to propaganda activities of alienswas a common practice about the time of the World War. I have talked with Col. Daniel N. MacCormack, Commissioner of Immigration and Naturalization, who tells me that there is now no law on the statute books to cope with such anti-American activities and that he is in entire sympathy with the objective to be sought, but frankly I will say that both he and I recognize that skill will have to be exercised to work out such a provision in language that will not interfere with the constitutional right of free speech. There is, nevertheless, a real necessity of curbing alien agitators who undoubtedly will come to the United States and seek by devious methods to throw us off of our netural balance and I believe that whatever the final draft of the neutrality legislation may be it should contain some such provision as section 5 of my bill.

Mr. GRAY. Are you in favor of a complete embargo on the declaration of war.

Mr. LUDLOW. I am in favor of a complete embargo both as to goods, loans, and credits.

The CHAIRMAN. As to everything?

Mr. LUDLOW. Yes.

Mr. LAMBETH. You favor the closing of our ports?

Mr. LUDLOW. I mean an embargo on shipments to foreign nations that are at war.

Mr. LAMBETH. You favor the closing of our ports?

Mr. LUDLOW. No, I do not mean to all foreign nations. I mean to belligerent nations.

Mr. GRAY. You mean to the belligerents only?

Mr. LUDLOW. Yes, only to the belligerents.

Mr. BLOOM. Mr. Chairman, I would like to ask Mr. Ludlow a question there.

The CHAIRMAN. Yes.

Mr. BLOOM. Mr. Ludlow, wouldn't it be much better for you to have a special bill to come through the proper committee to take care of the provision in section 5, irrespective of any neutrality bill?

Mr. LUDLOW. I will say to the gentleman, my friend from New York, that I am not as experienced a legislator as he is, but I do not see that it is out of place in this bill. It has an intimate relationship with neutrality, and I think it is proper here.

Mr. BLOOM. As to this bill, the way I understand it, it only takes effect in case of war. The neutrality part of your bill only takes effect in case of war?

Mr. LUDLOW. Yes.

Mr. BLOOM. Now, why shouldn't that be at any time, in time of peace as well as at war time? That is the way I should say it would be preferable.

Mr. LUDLOW. It might be made applicable to any crisis that might arise.

Mr. BLOOM. I believe in the principle of section 5, but I believe it should be applicable at all times, both in peace times, and times of war.

Mr. LUDLOW. Because of my more than 40 years' experience in newspaper work I am, naturally, in favor of the principle of free speech. For that reason I hate to make it any broader than necessary to pre

serve our neutrality. I believe in free speech but I do not believe in allowing agents of foreign governments to take advantage of free speech to undermine our neutrality.

Mr. BLOOM. Why shouldn't it protect us in peace time to prevent us from getting into war?

Mr. LUDLOW. Yes; that might be a point worthy of consideration. Mr. GILLETTE. Mr. Chairman, I have just a couple of short questions to ask Mr. Ludlow.

The CHAIRMAN. Yes.

Mr. GILLETTE. This bill, as I have hastily read it, does not take into consideration a full embargo against the goods shipped to neutral countries for transshipment to belligerent countries, other than as provided in section 7.

Mr. LUDLOW. I see what the gentleman means. I think that is an omission that should be corrected. I have in mind introducing a supplementary provision which possibly might, when noncombatant nations are found to be transshiping goods to belligerent nations, place an embargo that would at least hold shipments down to normal quotas on those particular nations.

Mr. GILLETTE. Were you attempting in your language prohibiting loans and credits to belligerent countries, referring to just action by the nation alone as a nation or individuals also?

Mr. LUDLOW. I am referring to the nationals of that nation as well as to the nation as a whole.

Mr. GILLETTE. I mean as to the people that are lending the money, not as to the recipients of the money.

Mr. LUDLOW. I am trying to cut off loans and credits bv embargo, to cut them clear off. I believe that if we continue to finance belligerent nations, or the nationals of belligerents, we will always be in danger of being dragged into war.

Mr. CHAIRMAN. I appreciate your kindness. I have trespassed too long now on your time, but there is one other suggestion contained in the last paragraph of my proposed bill which applies a penalty for disguising the identity of a consignor, and I would like to call your attention to it. I might say that an official of the State Department told me that a great many shipments are going out disguised under the names of Italian aliens when obviously they are shipments made by American concerns. That, of course, is deception, and I am fearful that it is inimical to the public interest, and I think that it might be corrected by the provision contained in the last paragraph of my bill.

Mr. BLOOM. I was very much interested in your letters to the nations A and B insofar as the shipment of goods was concerned. What do you think of this idea if it could be worked out: If nation A and nation B were at war and their average quota, we will say, was $5,000,000 for nation A, and just for argument's sake, nation B's quota was only $100,000. What do you think of the idea when war is declared between nations to have it understood that all nations should receive the same amount of goods, taking either the lower or the higher amount based on their quotas? In other words, if nation A were to receive $5,000,000 worth of goods, although nation B's quota is only $100.000 worth, to have an equal neutrality put them both on the $5,000,000 quota?

Mr. LUDLOW. I think the gentleman is actuated by the spirit of neutrality that I had in mind, to be neutral toward them whether

expressed in regard to parity of allotments or no allotments. I think, however, that the suggestion of making no allotments would carry out the idea the gentleman has in mind. I prefer the language of my bill.

Mr. BLOOM. Why not make it so that the larger nation should not receive any more than the smaller nation? Then you would be exactly neutral, wouldn't you?

Mr. LUDLOW. I think that would be better than the gentleman's first suggestion, but I think my bill covers the situation best.

Mr. BLOOM. Will you accept that as an amendment?

Mr. LUDLOW. I do not know that my bill is going to be accepted by anybody. [Laughter.]

Mr. BLOOM. I mean, would you accept that as an amendment to your bill? What do you think of it?

Mr. LUDLOW. It is wholly inconsistent with my bill.

Mr. BLOOM. Or in any bill, would you agree to that, that it would be exactly neutral, providing the nations that were at war should take either the highest amount or the lowest amount and say that would be the amount of goods that both would get?

Mr. LUDLOW. I think I understand the gentleman's intent, which is protecting our foreign trade as far as we can and at the same time observe neutrality.

Mr. BLOOM. Yes; and still be neutral.

Mr. LUDLOW. Just offhand, without having the slightest opportunity to digest your proposition and to consider it, I could not promise to agree to it.

The CHAIRMAN. He does not agree with you on the basic question, Mr. Bloom.

Mr. BLOOM. Oh, he does.

The CHAIRMAN. No; he does not.

Mr. LUDLOW. I am afraid we could not get together on that. Mr. TINKHAM. I should like to ask you a question in relation to section 4 of the McReynolds bill.

Mr. LUDLOW. I think I may spare the gentleman's inquiry and conserve his time by saying that I am in complete sympathy with him on that bill. If the question is whether I favor so-called "discretionary_neutrality" as compared with mandatory neutrality, my answer is I believe in mandatory neutrality.

The CHAIRMAN. So much mandatory that he stops all exports, loans, and credits of all kinds just as soon as war commences. Mr. LUDLOW. Yes; to the belligerent nations.

The CHAIRMAN. Is that your present position now, Mr. Tinkham, that you want us to stop all exports of all kinds, loans, and credits as soon as war breaks out?

Mr. TINKHAM. I am talking about restrictions of shipments from the United States of all materials that can be used in the conduct of

a war.

The CHAIRMAN. The mandatory provision you want is to stop it all.

Mr. TINKHAM. That is correct.

Mr. LUDLOW. Thank you, Mr. Chairman and gentlemen of the committee, for this opportunity to be heard.

(Whereupon, at 12:05 p. m., the committee adjourned until tomorrow, Tuesday, Jan. 14, 1936, at 10 a. m.)

AMERICAN NEUTRALITY POLICY

TUESDAY, JANUARY 14, 1936

HOUSE OF REPRESENTATIVES, COMMITTEE ON FOREIGN AFFAIRS, Washington, D. C. ·

The committee met at 10 a. m., Hon. Sam. D. McReynolds (chairman) presiding.

The CHAIRMAN. The committee will please be in order. Our first witness this morning is Congressman Sisson, of New York. Mr. Sisson was here all day yesterday. I should like to say, for the benefit of the gentleman's constituents, that he is a very valuable member.

STATEMENT OF HON. FRED J. SISSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK

Mr. SISSON. Mr. Chairman and members of the committee, I quite agree with what a number of the members of the committee said yesterday about the difficulty of the task with which this committee is confronted. The subject of neutrality legislation, socalled-and incidentally, while I have not any better term I could apply to the legislation, the term "neutrality" as many of you realize, is in some respects a misnomer, because one of my conclusions is that there is not any such "animal" as complete neutrality or impartiality. Partly by reason of that, and by reason of the fact that this goes to the very vital question of our relations with the other countries of the world, it seemed to me that this is one of the most laborious and difficult tasks ever imposed upon any legislative committee.

Judge McReynolds, who is the chairman of the committee, and the members of the committee, are entitled to the greatest credit, in my opinion, for producing a bill here that comes as near to meeting the situation and obtaining the desired objective, and meeting the varying views of different Members of Congress who have studied this question and are interested in it, as any bill that has been introduced. And if it be any comfort to the committee-and I know the committee are entitled to all the comfort they can get

The CHAIRMAN. Thank you.

Mr. JOHNSON. You are right, there.

Mr. SISSON. I might say that several weeks ago, after I had read quite a number of books, including the book you mentioned yesterday, Mr. Johnson, The Road to War, and a good many pamphlets and articles and other documents on this subject, I sat down and