AMERICA AND WAR DEBTS.

Press, Volume LXVIII, Issue 20495, 14 March 1932, Page 12

AMERICA AND WAR DEBTS.

(SPEqiAi.LV WBITTEN FOR THE PRESS.) .. [By Hartley Withers.] That notion that America ought to have cancelled the debts due to her from the Allies has always seemed to ine to be much too large an order. It has been popular in England and much more so on the Contuient, but the 'arguments' on which it is based are rather too thin. They are, first, that ' we were all brothers" in arms fighting for the same cause, and that therefore America, as by far the richest of -the combatants, and the one that suffered least by the war, ought to have thrown the money that she lent to the Allies into the common pool and ,not required its repayment;, and second, that she made huge profits at "the expense of the. Allies which ought to helve been taken into consideration on . the other side of the account. But though it-is true that America : fought on the same Bide, it cannot bo pretended that her interest in the defeat of Germany was nearly as vitalas 1 that of the Allies. She was so much out of Germany's reach and her ' immense area is so invulnerable, that the consequences of'a German victory would have been very much less serious to her. And as to the profits made by her at the expense of the Allies, it seems likely that all the belligerents did what they could to sell one another any articles'that were needed at the best possible price. Thus there was.a weak caße for total cancellatipn of debts by America, but a strong one for lenient treatment of her Ally debtors; and everyone must admit that in the war debt settlements America did behave in a lenient spirit. fn the ease of England she reduced a 5 per cent, debt to one running at 3, rising to 3£ per cent.; and with regard to France and Italy and other debtors she made compositions that were recognised as highly favourable to the borrowers, in spite of the prevalent belief in the United States that leniency would probably be abused, and that any money that she into the pockets of the Allies by remissions would be used by them for expenditure on armaments and preparations for fresh war or at least as an instrument of warlike dispfomacy. But if America was reasonable in the matter of debt settlements, her subsequent behaviour, with regard to trade nolicy has been so unfair to her debtors that the latter have a strong case when they argue that she has made it impossible for them to pay, and that, this being so, they are justified in proposing to take into then own hands the question of debt revision and suspension. In making this claim they can cite very high American authority in its favour: That a demand for payment of debts is logically and equitably mconsistent with a refusal to take goods shipped or services rendered in payment of them is a principle that was laid down more than a century ago by Washington, Jefferson, and Hamilton. These are names which all Americans will accept, with respect as authorities; and it was acting on this > principle that these statesmen, as related by Mr F. W. Hirst in his "Wall Street and Lombard Street," "excused American citizens from paying commercial debts admittedly due by treaty after the American War of Independence." Impossible Conditions. Their contention was that a creditor must not by tariffs and prohibitions deprive its debtors of the means of payment —an obviously sound and senBible argument; and the Allies can thus call Washington and Jefferson as witnesses for the justice of their claim to relieve themselves, in so far as thejf think fit to do so, from an obligation which the creditor has made it impossible for, them to ' fulfil. They, could evidently contend that such.; an .action woiM not be repudiation, on their..part* and that the repudiation would be the net of.the creditor, who has put every; difficulty and obstacle in the way of the debtors in making payment in any form of goods and services, such as. the debtors were ready to provide. On this point there can be no two opinions. Not only "has America raised her tariff to a.monstrous height against most kinds of manufactured goods;; not only has she, by her policy of prohibition of . alcohol, made it .illegal for Trench, German, and Italian producers of generous and wholesome wines to sell them in the United States;'but she has also, by all kinds of artificial encouragements and devices, done her best to. stimulate, at the expense, of the American taxpayer, the activities of the-. American mercantile fleet, in competition with the shipping of. debtor countries trying to earn a living on business lines. j For some time America: cased this impossible position for her debtors by free lending abroad; but this method of adjustment, which only made the situation ultimately more' difficult, stopped when her citizens indulged in their monstrous gamble in their own securities. Then they not only reduced their foreign lending but sucked in money from all the impoverished world to finance the gamble., And when the gamble ended in collapse, America turned seller of securities on a huge scale which she threw on to foreign markets, shivering under the effects of Wall Street's collapse. By these methods she has become, as has been picturesquely said, a veritable syphon for gold, which ha"s poured in not by any fault of the Federal Reserve Banks, but owing to the trade policy of the Government and the speculative vagaries of the population. And so the rest of the world has been curtailed of its supplies of what was till lately, the general basis of credit, and a catastrophic fall in prices has knocked trade to pieces and gives America's debtors a still further right;—since the fall has been caused largely by the actions of the creditor to set about the revision of these international debts, ■ having first announced a continuance of Mr Hoover's suspension for a period that will allow'due consideration of the terms of revision. PROPERTY SALES. H. Malson and Co. report that their Tattorsall's Land Room was filled on Saturday morning, when two properties of 46 acres and 100 acres respectively were submitted to public auction on behalf of the executors of the estate of the , late James Kimber, The 46-acre farm fell to the bid of Mr B. Hutchison, of Greenpark, at £54 10s per acre, and the 100-acre lot was passed in. Competition for both lots showed the revival of confidence in small farms of the. best grade land. _ . i Messrs Pyne, Gould, Guinness, Ltd., were-; amenta in conjunction on this occasion. ! H. G. Livingstone and Co., auctioneers, sold' on Saturday, at their rooms, 109 Hereford street,- a property situated No. 18 College avenue, comprising section of thirty I erches together with two-storey bungalow of six rooms and garage, fro. a client. —3 CLEARING SALE OF NURSERY STOCK. On Saturday afternoon, H. G. Livingstone -nd Co., Auctioneers, on account of the de-benture-holder, held a clearing.' Bale of the plant and loose stock on the property of T D. Lonnie and Co., nurserymen, North road, Belfast. There was an attendance of between /■'Oo and GOO nurserymen and private gardeners from as far as Ashburton, Oxford, and Hanmer. Over 500 lots were sold, the competition boing brisk throughout the sale.. A saw tench realised ±'l7, an old waggon £ll, and piping, boxes, glas, pots, pot-plants, palms, and other lots realised good prices.