106 SECTIONAL ADDRESSES 
contradiction arises of financial distress accompanied by excess supplies of 
certain categories of goods which is so marked a feature of the present 
depression. But it would be a mistake to conclude that bilateral trade 
treaties can never benefit either or both of the contracting parties. This 
can happen when the currencies of each are reasonably free from fluctua- 
tion, when neither is greatly indebted to the other, especially on short 
term, when there is mutual confidence in each other’s jpolitical stability 
and each has need of the other’s specialised products or is willing to 
purchase them. A possible example is the case of Sweden and Great 
Britain. Such instances, however, do not controvert the fact that other 
countries lose more than is gained by the two more fortunate nations. 
At the best such agreements merely divert trade. They can do nothing 
to enlarge it. 
VII. 
What are the prospects for the future ? Will trade barriers disappear 
or be modified ? Will all these exceptional contrivances for safeguarding 
trade balances be forgotten when the present emergency passes? It is 
too soon yet to give an answer to these questions; but in any case the 
restoration of comparative freedom in international trade will be slow. 
Until the most fundamental cause of all restrictions is removed—dis- 
parities in the price levels of the same commodities in different countries 
due to different degrees of currency depreciation—it is unreasonable to 
anticipate much progress. But at the same time it is well to guard against 
exaggeration of the extent to which self-sufficiency is actually a conscious 
deliberate policy of the principal industrial and commercial countries in 
the world to-day, and to avoid the conclusion that every restrictive 
measure on imports is actuated by considerations mainly non-economic 
and national. On the contrary, it would be more correct to assume that 
the aims of restriction are to enlarge the volume of international trade 
as a whole, however paradoxical thismay seem. Itis reasonable, therefore, 
to expect that barriers will be removed when it is discovered that they 
hinder rather than foster the attainment of this object. 
Some relaxation of the quota system has already been devised. There 
is a tendency now to use it not to place absolute limits upon the volume 
of imports but, rather, to set a maximum limit to the quantities of goods 
to which a lower scale of duties apply, there being reciprocal agreements 
that imports above this limit shall be admitted on a higher scale of tariffs. - 
This plan is designed to avoid serious disturbance in a given price level 
within the importing country for each commodity coming under the 
scheme. It has been embodied in treaties between Austria and Hungary, 
Roumania and France in reference to wheat, and in several other treaties 
between countries in central and eastern Europe in reference to other 
commodities. If there must be prohibitions or restrictions, it is fairly 
well adapted for the protection of the internal price levels of commodities 
whose domestic production is considered desirable or in the case of which 
there are official marketing schemes which have to be nursed with care. 
This system of tariff quotas as distinct from import quotas would seem, 
therefore, to offer help to countries engaged in planning internal pro- 
