WAR DEBTS

Hokitika Guardian, 11 January 1932, Page 5

WAR DEBTS

PLAN FOR CANCELLATION.

EUROPE’S PRECARIOUS POSITION

(United Press Association.—By Electric

Telegraph.— Copyright.)

LONDON, January 10. Hon. Alexander Shaw (Director of the Bank of England., and of the P. and O. Shipping Coy., also of the British India Steam Navigation Coy., of the United Kingdom Provident Institution and vice-President of the U.K. Chamber of Shipping), spoke at a luncheon in the new I*, ad 0. Liner “Strathaird,” (just completed), ana dealt impressively with the reparations and war debts. He sat at tne head of the table with Lady Shaw (who is a daughter of Lord Inchape.) Hun. Air Shaw mentioned that ho had to he cautious ns budget Director of the Bank of England, lie said tnat it should never be forgotten that while America had remitted eighteen per

cent, of Britain’s war delvt liability, Britain, as a creditor, had forgiven her allies seventy per cent, of their war debts. Britain, in her old wars, had frequently granted subsidies to her allies, not as a loan, but as a free grant.

Hon. Air Shaw* said that in the great war ; wlihre the American shells

werp fifed by the American artiiterymeip from American guns, the United States did not charge against allies either her soldiers’ pay or the cost of the gun or of the .shell ; but where an American, shell was fired by a British or a French soldier, it was created a gold debt due to the United States. The same extraordinary rule also held between all of the other Allies. Never in the history was lopsided commercialism «o mis applied. He did not believe the masses of any country thought* then about the repayment, or wanted it. They gave their money, energies, and lives for a common cause.

Hon. Mr Shaw paid a tribute to America’s part in saving the freedom of the world. He said that he could not imagine that America would insist on a course which would postpone for the “Greek Kalends” the recovery of Europe and indeed, of the whole world. He described the problem as “twofold collection transfers.” The Nations were confronted with the fact that there was not enough free gold in the world to meeit the bill for the reparations and for the war debts, which could best, therefore be paid in goods and services. The total value of the goods, spread over fifty years, wherewith to pay America, if she insisted, would amounlt. to the equivalent of four thousand five hundred millions sterling. This continual drain of goods, besides being unwanted was dislocating America’s own production, and it impoverished American’s foreign customer.’’

He continued: “As regards the Money market of the world, the symptoms are those of a general malaise, punctuated with panic, and an atmosphere of menace hangs over Europe. The distrust existing gives rise to armaments, and these to more distrust, and to stagnation of industry. It is no exaggeration to say that the economic and social structure of Europe ig daily moving nearer to a precipice.

“Europe,” he said, “was in a position where willingness to pay, however, admirable, was no longer relevant. The “blunt truth”' he said, “is that if things go on as they are going, the choice will simply he between repudiation and chaos. May I .suggest a healing message .spoken long ago: “Forgive us our debts, as we forgive our debtors ” These words teach us the wise and the only practical economic policy.

Mr Shaw added that lie had spoken plainly, because these were no times for false and easy optimism.

OX VERGE OF COLLAPSE

GERMAN’S ECONOMIC LIFE,

BERLIN, January 20.

Chlaneellbr IBruerJing ha.s informed Bum bold that Germany is unable to pay her reparations, and that, her delegates to the Lausane Conference must press for their total abolition oi the reparations. Authoritative circles point, out that Germany’s economic life is now on the verge of a collapse, which certainly cannot bo avoided if any attempt is made to impose the reparation burden on Germany, ft is stated that if Germany is relieved of this burden, she will lie able to pay her private debts in due course, but that she cannot possible pay these along with the reparations.