Between 1934 and 1945, the United States signed 32 reciprocal trade agreements with 27 countries.  In addition, the conclusion of the General Agreement on Tariffs and Trade was taken by the Authority under the RTAA. The second major external initiative of 1934 was the Trade Agreements Act (RTAA). In March 1934, Roosevelt asked Congress for the power to negotiate trade agreements based on reciprocal tariff reductions with other countries, “that the full and sustainable recovery on the national territory depends in part on revitalized and strengthened international trade.” The RTAA came into force on June 12, 1934 and was a fundamental change in U.S. trade policy. The Constitution gives Congress the right to regulate international trade and set tariffs. Under the RTAA, Congress granted the President the right – temporarily, subject to a three-year extension – to reduce or increase U.S. tariffs by up to 50% of the levels set by the Smoot Hawley tariff in 1930 in exchange for tariff concessions from other countries. Such tariff reductions would come into effect through executive agreements rather than contracts requiring Senate approval. The U.S. ZOLL reductions negotiated under the RTAA would also be extended to all third countries to which the United States has granted the status of most favoured nation. The Reciprocal Trade Agreements Act was signed on June 12, 1934 as part of the Roosevelt administration`s efforts to pull America out of the Great Depression.
RTAA has been an integral step in the U.S. transition from economic crisis to global leadership. The FDR considered that a full and sustainable recovery depended on strengthening international trade to increase domestic growth and demand. To ensure our country`s place in the global economy, the U.S. President and Congress had to work together to negotiate trade agreements, reduce tariffs on goods and increase U.S. exports. Strengthening international trade fostered the growth aspects of the New Deal`s domestic programs, and the successful implementation of the RTAA resulted in the conclusion of 19 new trade agreements between 1934 and 1939, strong growth in U.S. exports and a recovery of the U.S. economy.
Today is the 80th anniversary of the Reciprocal Trade Agreements Act (RTAA), a new approach to trade policy adopted by the New Deal Congress and signed by President Franklin D. Roosevelt. RTAA was the first time that Congress and a president worked together to give trade bargaining powers, to help pass new trade agreements that would increase exports and encourage job creation. Through the RTAA, Congress defined the framework for international trade negotiations and authorized the President to play a U.S. leadership role in the international trading system. 79. “Minority Views,” in Congressional Record, March 27, 1934, 5532-33Google Scholar; Vandenburg, , Congressional Record, 18 05 1934, p. 9081-82Google Scholar.
You will find an overview of constitutional issues under Sayre, The Way Forward, Cpl. 7.Google Scholar 87. On the Peek-Hull controversy, see George, Fite, George N. Peek, chaps. 16-17Google Scholar; Steward, Trade and Hemisphere, Cpl. 2Google Scholar; Peek, George N. and Crowther, Samuel, Why Quit Our Own? (New York: Van Nostrand, 1936) Google Scholar. The correspondence between Peek, FDR and Hull and Peeks objections is presented in the “Special Adviser`s Report for Foreign Trade”, which was sent to the FDR by Peek on 31 December 1934; OF 614A, the Special Adviser`s report, and in a series of six articles in the Saturday Evening Post, from May 16 to June 20, 1936.
Between 1934 and 1939, the Roosevelt administration entered into trade agreements with 19 countries under the Reciprocal Trade Agreements Act: Belgium, Brazil, Canada, Colombia, Costa Rica, Cuba, Czechoslovakia, Ecuador, El Salvador, Finland, France, Guatemala, Haiti, Honduras, the Netherlands, Nicaragua, Sweden, Switzerland and the United Kingdom.