I was going through a found copy of the August 1954 issue of Town & Country and came across an article on Warren Lee Pierson. Actually, it was a birthday tribute written by his wife Eleanor, novelist and contributor to Town & Country. Eleanor was clearly still very in love with her husband when she wrote it, and it revealed some interesting things about this man who is generally forgotten today, but who was very influential in his life
“He started his business career as a lawyer and after a few years of private practice was called to Washington as special counsel to the Reconstruction Finance Corporation" Eleanor begins. “One would have thought he would be busy enough supervising and issuing municipal bonds for such western states projects as the San Francisco Bay Bridge and the Metropolitan Water District, but soon he was spending his 'after-work' hours on a plan for reviving United States foreign trade which had been stagnant since 1930. The Export - Import Bank…had a key place in these plans."
Pierson was named president of the Ex - Im Bank in 1936 and served in that position for 10 years. “There were many trips to all of the Latin American countries, Asia, and Europe for the purpose of evaluating trade needs and possibilities," says Eleanor. “As a result, many sound loans were made which helped start the flow of foreign trade after years of depression. This was in keeping with Warren's creed that world trade is the best means of promoting international good will, understanding and peace." Warren did a solid job during his tenure, achieving a string of mutually successful loans and deals for the U.S. and its international business partners.
Eleanor may not have been privy to, or chose to leave out of her birthday note, the wider reasons behind Warren's Ex - Im endeavors. It was a period of struggle for the American economy, and Germany, led by the recently elected National Socialist Worker's Party (referred to as the Nazis for convenience) was making inroads in various South American economies, and that was too close for comfort for some in Washington. However, by all accounts Warren did seem to truly believe in the vision he espoused.
In a 1942 speech delivered to the Convention of the National Foreign Trade Council called “The Export - Import Bank and the War," he laid out his governing philosophy as head of that organization, “…In that time, however, we have necessarily established for ourselves certain criteria, certain principles to guide our daily actions…That principle is simply this - we help ourselves by making others strong. To the mercantilist of an earlier day, that would be heresy. To present day mercantilists, it is still heresy. The essence of our foreign trade, we are told, lies in the exchange of our finished goods for the raw materials of the economically backward nations of the earth. If our customers become strong - if they develop their economies and make their own finished products - why should they continue to buy from us?"
“The most convincing answer to this question lies in the familiar tables of foreign trade statistics. You members of the foreign trade fraternity know that the best customers of the United States have not been found in the least industrialized centers of the world - in China, in Africa or even in the partially developed nations of Central and South America. On the contrary, we have found them - in normal times - in those countries which have most fully realized their economic potentialities - in England, Germany, France and Japan.
“The answer to this apparent paradox lies in two simple factors - purchasing power and the differing geniuses of different peoples. Because they are developed economically, the latter countries have the money to buy from us. Because they differ from us in a thousand subtle ways, the products of their machines are not the same as ours and must ever posses that variety which is not only the spice of life but the great impetus of trade.
“In this sense - that variety is the source of trade - the mercantilist is right. He sees variety, however, only in black and white, the night and day of finished goods and raw materials. By so doing, he dooms the flow of his foreign trade to the feeble motive power of a coolie's purse. I say only that variety is infinite and that the highest and most profitable form of foreign trade lies in the exchange of an infinite variety of products between economic equals.
“With this principle in mind - that we help ourselves by making others strong - the Export - Import Bank has steadily endeavored to help diversify the economies and, where economically feasible, to cooperate in developing the industries of other nations, chiefly China and the Republics of the Western Hemisphere."
Pierson was a key figure in advancing the Roosevelt administration's goals of improving U.S. relations with Latin America, and his tenure in the Ex - Im Bank greatly liberalized and increased trade between the North and South American continents in the wake of the Great Depression. The U.S. has the opportunity to have a similar effect in developing economies in Asia, and a more open, more economically integrated North Korea could benefit the U.S. by benefitting its allies in the region. As everyone has a greater and greater economic stake in regional stability, American security responsibilities can be eased and reduced.
“Furthermore," beams Eleanor in her birthday tribute, “these loans made friends for the United States because the foreign debtors ended up with a sense of accomplishment, honor, and pride in a transaction well handled. This is evidence that Warren is no dewy-eyed do-gooder, but a man of clear judgement."
After World War II, Warren Lee Pierson was named president of the All America Cables and Radio Corporation, which created more international trade deals and loans - particularly with Mexican media companies. Then, after stints on the Inter-American Financial and Economic Advisory Committee and the Inter-American Conference on Problems of War and Peace, he became president of yet another corporation, this time in aviation. As head honcho at TWA, Pierson took flights around the world with his technicians and pilots looking for new routes through Asia, as China had recently closed itself off to travelers.
“Trade, communication, and travel will do more to bring about world peace than all the treaties we can sign," Eleanor recalls Warren repeatedly saying.
During that time, Warren served as president of the International Air Transport Association and as the U.S. delegate to the Tripartite Commission on German Debts where he helped negotiate Germany's WWII debt settlement. If that wasn't enough, he was then named chairman of the U.S. Council to the International Chamber of Commerce, “an organization of businessmen from some fifty countries who favor the expansion of foreign trade and understanding among nations," as Eleanor puts it.
In that position, his role involved lots of speeches and lots of networking, which sometimes clashed with his silent and reflective nature. “How often I have seen that door-without-a-handle expression on his face as he listened to someone sounding off," Eleanor recalls. “During the elocution display, no one can tell how he is reacting. Gradually the speaker becomes aware of the Great Calm he's talking into and begins to wonder how he's going over…When the signs of winding down appear, that is the moment for his response. His answer is apt to be a diagnosis and a proposal of ways and means, instead of a retort. Action rather than words is his approach to life and his quiet determination inspires confidence in others…Then I discovered that he had a saving sense of humor, too, which kept him from ever being pompous or self-important."
Of course, keep in mind “this summing up was a dangerous commission for a wife to undertake, presenting almost the same hazards as a self portrait." Nevertheless, a lot can be taken from this portrait. Pierson was a supporter of keeping the Soviet bloc countries of Eastern Europe integrated with the wider European economy saying the American public “might as well adjust itself to the fact that there will be an increase in East - West trade," and “a foreign economic policy of expansion which would increase imports into the American market and produce a concurrent expansion of U.S. exports. Our whole economy would benefit." We see today that not only was he right about post-war Europe, but about Asia as well.
As Henry Kissinger detailed in his 2011 book On China, during the lead up to the U.S. - China opening in both countries the attitude toward each other was publicly hostile, but the groundwork was being laid in back channels. It will be many years before we find out if any such conversations are being had in the back channel discussions between U.S. and DPRK officials. In any case, we could use a problem solver like Warren Lee Pierson.
Warren Lee Pierson
On 27 October, KBC participated in a seminar called "Doing Business in North Korea" at the Nearby The Tree bar in the Sanlitun district of Beijing. The event was organized by Paul Tjia of GPI Consultants in preparation for a media tour with 9 European journalists to Pyongyang he was leading. KBC's director Roger Barrett spoke alongside Mr. Tjia and Simon Cockerell of Koryo Tours.
"(The DPRK) finds itself at a new era of international economic cooperation, and it especially welcomes business with Europe," Mr. Tjia said in a statement about the event. "The DPRK is offering various products and services to export markets, while the country is also in need of many foreign products and investments" he said.
Mr. Barrett of KBC stressed to the journalists to take a sober look around during their 5 day visit to Pyongyang, and the need to not be sensational in reporting on the country.
"A textile company was visited. Companies in Europe, China, and South Korea are producing various kinds of clothing in North Korea and some of the local factories have become very large and experienced exporters. With a highly skilled labour force and the lowest wages in Asia, a growing number of foreign garment firms are currently operating in-country" said Mr. Tjia.
The journalists were also given a presentation about changes in economic policy by the DPRK's Academy of Sciences. Plans related to the North's Special Economic Zones and laws related to international joint ventures were also discussed with the European media group.
Click here to view a Dutch media report on the event.
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KBC will be leading business fact finding missions to the DPRK for mining, manufacturing and investment in 2015. Stay tuned for more details, and if this piques your interest, drop us a line at email@example.com.