DE-BALKANIZING

STATES & CITIES

Last week the theory that a pun can be the highest form of propaganda was again tried out on the U. S. people. A little-known but potent organization called the Council of State Governments adopted and broadcast Balkanization. Intent: to convey the idea that trade fences erected by & between the 48 hitherto United States are becoming as dangerous to U. S. economy as Balkan feuds have long been to the life of Europe.

The rostrum for three days of earnest punning at Chicago's Stevens Hotel was a national Conference on Interstate Trade Barriers. At the Council's instance, seven Governors and the representatives of 37 States dabbled in Constitutional history, gazed gravely at charts depicting some of the most astonishing phenomena of current life in the U. S. Among facts related, deplored:

> Rhode Island once put red dye into 5,000 quarts of Vermont milk.

> In North Carolina and Georgia, the only eggs legally fresh are eggs laid in North Carolina and Georgia, respectively.

> Kansas has 66 "ports of entry," California 11, Oklahoma 58 where out-of-State trucks are inspected and loaded with fees. To operate a five-ton commercial truck between Alabama and South Carolina costs its owner $1,100 annually in registration fees, special taxes.

> For benefit of dairymen, 24 States tax oleomargarine. Some are thinking of banning each other's milk, butter, cheese. Meantime, while the per capita consumption of milk stays too low for public health, Southern States whose cottonseed goes into margarine threaten to forbid or restrict imports of dairy products.

> Michigan taxes domestic wines 4-c- a gallon, out-of-state wine 50-c-. Many other States war on each other with preferential taxes on liquor, beer, wine.

Any intelligent schoolboy knows that all this kind of thing makes all the people poorer than they need be and is sheer economic nonsense. One thing to do is to view with alarm, and this was ably done in Chicago last week by two potent Governors--Cochran of Nebraska and Stark of Missouri (see p. 21)--who discerned and decried a menace to "free America."

U. S. Solicitor General Robert Houghwout Jackson, with the blessing of his beloved President, announced: ". . . The Federal authority must and will uphold the Constitutional mandate that commerce among these United States be free."

By giving Congress sole power to levy tariffs and otherwise regulate commerce between the States, the Founding Fathers thought to insure free trade within the U. S. and prevent in future the economic horrors of the Revolutionary Confederation. But modern States have the express power to restrict liquor imports (granted by the 21st Amendment, on the mistaken assumption that only dry States would use it), to tax liquor for revenue, police their own citizens and commerce for the public good. In self-defense, in response to pressure-groups, and, most of all, in blind efforts to combat Depression, the States have stretched and perverted these powers to impose taxes, trucking fees, quarantines, which in actual if not legal fact are tariffs between the States. Since most of the devices are technically constitutional, only the Legislatures which created them can remove them.

The conference last week was staged to dramatize Balkanization and get citizens interested in making their Legislatures take curative action. For that, the Council is well equipped. It was formed by a determined Denver lawyer and legislator named Henry Wolcott Toll (TIME, April 27, 1936). Henry Toll turned it to fostering Commissions on Interstate Cooperation, which exchange information between Legislatures and promote interstate compacts on water pollution, fisheries control, etc. etc. Founder Toll helped plan the conference, left the running of it to the Council's Director Frank Bane, who until last year was executive director of the Social Security Board. Director Bane in turn left the dramatization of interstate trade barriers to Dr. Frederick Eugene Melder, an economist from Clark University who plays with toy trains and works at demolishing trade fences. Offhand, Dr. Melder called to mind 409 restrictive State trade laws, said there are perhaps 600 more to be abolished if the U. S. is again to become "the world's greatest single free-trade area."

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