The Reciprocal Trade Agreements Act, which has been the chief instrument of United States foreign trade policy for the past 3 years, became law on June I2, I934, and was extended in I937 for an additional 3 years. The situation which created an imperative need for this legislation, and the fundamental principles underlying it, have been so widely discussed as hardly to need repetition. Many nations were unable to restore their foreign trade to its normal volume because of currency depreciation and a breakdown in foreign exchange mechanism; on the other hand, they were unable to stabilize their currencies and exchange because of disjointed trade. In addition to pre-existing tariff barriers, there were growing up systems of exchange control, clearing and compensation agreements or barter arrangements, import quotas, and with reference to some commodities, nearly complete embargoes in certain countries. A growing tendency toward bilateral balancing of trade made the situation still worse. Every nation professed to deplore the situation, declaring itself the victim of circumstances, yet the adoption of new restrictions continued. World trade declined from $68,6zz,ooo,ooo in 19z9 to $26,848,ooo,ooo in I93z, while the United States foreign trade fell in the same years by an even greater proportion, i.e. from $9,640,000,000 to $z,934,ooo,ooo. Although our foreign trade accounted for only about io per cent of our total trade, the dependence of many branches of industry and agriculture on exports was far greater than that. Indeed, the disposal of agricultural surpluses had become one of our chief national problems.