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204 7 / Customs, Courts, and Claims The Industry and the Law, 1922–1930 With the war increasingly behind them, Americans attempted to return to a peacetime economy, but the war’s political and economic fallout would consume the synthetic organic chemical manufacturers’ attention through the 1920s. Isolationism permeated the United States, and Americans lost trust in the benefits of global ties. The synthetic organic chemicals manufacturers , with their hope to survive the peace and thrive in the 1920s, certainly had no desire to return to a prewar state. They worked hard to establish a new status quo in which the German firms would never regain their old footing in the American market. With the Tariff of 1922, the manufacturers had acquired an important victory, but the uncertainties of the immediate postwar years carried through the 1920s, and the manufacturers continued to call on the government for support. While the domestic industry had won the favor of the executive and legislative branches of the federal government, the courts became integral to the industry’s future in the 1920s, and it was not clear the judiciary would be nearly as sympathetic as the other branches. The Department of Commerce and U.S. Tariff Commission and related customs agencies continued to be among the manufacturers’ best allies in the federal government. In particular, the manufacturers’ leading trade association worked very closely with customs officials to ensure that administration of the new tariff would provide the maximum protection. Paradoxically , as the United States and its nascent synthetic organic chemical industry increasingly hunkered down in its isolationist mood, there was also a concerted effort to study world markets. The Department of Commerce and other government agencies collected a vast storehouse of statistics , analyzed economic trends, and stationed economic observers in consulates around Europe and elsewhere in the world. The manufacturers had learned well the power of market information during the war, and they supported wholeheartedly the government’s expanded programs to monitor international trade. The continuing political and economic instability in customs, courts, and claims / 205 Europe, as well as the revival of the powerhouse German firms, kept Americans ’ attention on Europe even as they reinforced their trade barriers to the outside world. The legal fallout from war measures also demanded continued attention to Germany and its chemical industry. The war left behind a morass of disputed property rights, and the 1920s included a major challenge to the legality of the Chemical Foundation and the settlement of other war claims. At the beginning of the decade, it was not at all certain that the confiscated German property would still be in U.S. hands once Congress and the court system sorted through the complicated claims. As the anti-German hostility of the war years subsided and cooler heads began to reassess wartime decisions, the domestic synthetic organic chemicals manufacturers feared that policymakers and judges, without the wartime sense of urgency, would turn their backs on the industry and allow German firms to regain the American market. Tariff Administration and the Department of Commerce Shortly after Congress enacted the Tariff of 1922, the preeminent Harvard economist Frank W. Taussig published a harsh critique of the new protective legislation. He was skeptical of the administrative and procedural elements it would require, and he was convinced the dyes provisions were the consequences of “military excitement” rather than “cool economic considerations .” But the ardent (and ideologically lonely) free trade advocate found even more to dislike in the tariff. Protectionism had been the law of the land for decades, and Taussig bemoaned the terms of the debate. Rather than view differences in labor costs and natural resources as the grounds for advantageous trade among nations, theorists of protectionism ignored free trade and debated the qualities of a good tariff. Increasingly, Progressive Era protectionists argued that an ideal tariff would be one in which the customs duties perfectly offset the cheaper costs of production abroad, creating a “fair” competition between domestic and foreign goods, a view the supporters of a domestic synthetic organic chemicals industry endorsed wholeheartedly. The theory was a “sort of fetish,” complained Taussig, and “fatally unsound.” Taken to its logical extreme, the protectionists ’ logic would eliminate all international trade; it was an economic theory for an isolationist age. Protectionists were pleased with the new “flexible” provision of the legislation, which allowed the president to change the tariff without congressional approval, within certain limits. In other words, the flexible provision offered the opportunity to adjust the customs duties as...

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