The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY, MAY 31, 1929.

Hokitika Guardian, 31 May 1929, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. FRIDAY, MAY 31, 1929.

DEFAULTING U.S.A. SOUTHERN STATES.

On more than one occasion during the last few years, says a Home financial journal, the London Chamber of Commerce has drawn public- attention to the debts of the old Southern States of America, eight of which have now been in continuous default for periods varying .between 55 and So years, and the report, reently issued, ot the Council of Foreign Bondholders, upon which tin* Chamber has statutory representation, once again reviews the position, concentrating especially on the deiaiilt and subsequent repudiation of the old debt of the State of Mississippi. It has been demonstrated beyond question that these bonds are valid, that the debts were not connected in any way with the Civil War, nor contracted hv the “carpet bag” governments

following the war; that the loans were raised lor ihe commercial and industrial development of the State; anti that the validity of the issues has been upheld by the Highest State Courts 1 oi Mississippi. Yet the representations that have been made in recent years have apparently done as little as the protests of earner days to remove what President Roosevelt' once called “a painful and shameful page” in American history. The nature of the debts, their occasion, and the circumstances of the defau.t and repudiation have been set forth many times—the case of Mississippi is again stated plainly and in detail in the report alluded to above —and it is extraordinary that no steps at all have apparently been taken even to consider the remedying of such a position of gross injustice. In 1926 the Chamber drew public attention to the debts, and Sir James Martin, the then president, introduced and carried a resolution at a meeting of the Association of British Chambers of Commerce urging the Federal Government to take action. When a copy of the resolution was sent to Sir A listen' Chamberlain, he intimated that it would be undesirable for him to forward a copy to the United States Ambassador, and suggested that it should lie sent direct to Mr Houghton, who, on receiving it, stated quite naturally hat the proper channel of' communication to the United Slates Government was through the British Foreign Office and H.M. Embassy at Washington. Early last year the Council of foreign Bondholders reviewed the position at length in its report, and Sir Janies Martin again submitted a resolution to the Association, further setling out the facts, and expressing tlie hope, that since individual bondholders were precluded from bringing a suit against a State in the United States Courts, the Federal Government might see its way to use its powers under the Act of Congress, 18/0, to recover, .on behalf of bondholders, moneys due, from the States concerned. The Association unanimously adopted this resolution and transmitted it to the Foreign Secretary and to the principal Chambers of Commerce in the United States. The position has, in fact, been made abundantly clear by responsible bodies in Groat Britain, and still no action of any kind lias boon taken in the interests of private bond-holders, although, as regards its own holdings, the Federal Government exercised its powers of withholding moneys due. The present report of the Council of Foreign Bondholders once more brings tlie matter to tlie front and it is to be Imped that it will not he allowed to fall into obscurity until at least some measure of justice lias been done to creditors of tlie Southern States by a country that is now proud to call itself the richest in the world.