THE TARIFF: Pulpwood Embargo

The Treasury department last week invoked against Soviet Russia a provision of the Tariff Act, prohibiting the importation of goods made by convict or forced labor. Assistant Secretary of the Treasury Seymour Lowman, in charge of customs, instructed all ports to bar shipments of Russian pulpwood for paper manufacture on the ground that the cargoes in Russia were loaded by political prisoners. Hardest hit by this order was International Paper Co. which, to break the Canadian monopoly of pulpwood, had given a large order to Amtorg Trading Corp., Soviet commercial agency in the U. S.

As soon as the pulpwood embargo was announced, shrewd U. S. manganese producers, anxious to cut off foreign competition, raised a cry against Soviet “dumping” of this ore into the U. S. market. As an ”infant industry,” manganese men first secured a protective tariff of 1¢ per Ib. for their product in 1922. Last year they successfully defeated the attempt of big U. S. steel makers, who prefer the better grade foreign ores, to free-list manganese in the 1930 act (TIME, Aug. 26 etc.). J. Carson Adkerson of Manhattan, president of American Manganese Producers Association, now complained that increasing importations had closed U. S. mines, thrown 3,000 men out of work. He charged that the Soviet works its Georgia mines with “cheap, conscript contract labor.” Amtorg insisted the Soviet’s manganese miners are paid $43 per month, live under “very satisfactory conditions.”

Assistant Secretary Lowman in Washington began an investigation of the Soviet labor situation in connection not only with manganese but also lumber and anthracite coal. If he found that convicts had a part in these Soviet industries, he was ready to extend his embargo.

More ill luck pursued Amtorg last week when federal agents arrested two Russians in Manhattan on a smuggling charge. Seized were 640 Swiss watch movements. The prisoners said the watch movements belong to Amtorg. On them were found papers and notebooks which U. S. District Attorney Tuttle called “the most significant find yet made regarding secret Soviet activities in this country.” Amtorg denied everything.