WELLINGTON NEWS

Hokitika Guardian, 22 February 1932, Page 3

WELLINGTON NEWS

DEBT SETTLEMENTS

(Spi-toial Correspondent.)

WELLINGTON, Feb. 19

Perhaps the most cheering and satisfactory cable message published in the daily press of the Dominion was that in connection with Germany’s reparations. ‘lt will be remembered that the Prime Ministers of England and France were to have met to discuss preliminaries in connection with the Lausanne Confeience. But this preliminary meeting was abandoned because of political troubles in France. Since then discussions have taken place, and as a result an agreement has been reached to postpone the Lausanne Conference until June, and 'to agree on a lasting settlement of the question raised in the report of Basle and those necessary to solve the other economic and financial difficulties which are ,responsible for and may prolong the present .world wide crisis. The Basle Committee consisted of banking experts nominated by the Central Banks, and was appointed by the Bank of International Settlements to inquire into Germany’s ability to meet her obligations under the Young Plan. The Committee, winch came into existence at the bequest of Germany, reported in favour of Germany. The Young Plan contemplated a steady advancement of world trade in which the annuities payable by Germany would become a factor of diminishing importance, whereas the opposite has been the case, lheie has been no previous parallel in times of peace to the dislocation that is taking place. From July last it has been evident that if the crisis which overwhelms Germany were not remedied it would spread all over Europe, destroy the credit system, and create profound repercussions elsewhere. The 'Committee suggested that the adjusting of all reparations and war clebts to the circumstances of the world should take place without delay if new disasters are to be avoided. It is the only lasting means of re-establishing confidence, which is of prime importance. The Committee pointed out that Germany’s industrial production fell between ; 1928 and 1931 by one third, re suiting 'in the number of unemployed increasing to 5,000,000. Germany’s demand ‘for capital to fill the gap left, by the war and its aftermath had been met to a substantial extent by an influx of capital. estimated by the Committee ajt *£900,000,000.. Though £500,000,000 ha's been set off by reparations the balance of £400,000,000, together with Germany’s own savings, has led to a largo development of publiic and private enter-

prises. Although the fall in commodity prices measured in gold is the immediate cause of the world crisis, the fundamental causes are reparations, war debts and tariffs, and it is of singular importance to the world that 'the projected June (Conference at Lausanne is to agree upon a lasting settlement of the questions raised. The'Conference can. of course, determine on reparations, but dealing with war debts must bring the United States into the limelight. Leading politicians in America have declared against the reduction, let alone the cancellation of war debts, but serious import need not he attached to the.se vapourings, for they are pre-election tosh. America will stand in (with 'the rest of the world

for she is no more anxious to continue suffering than are other nations. The psychological effect of any sound and lasting settlement will be great. ■lt will give birth to confidence, and rid the world of many fallacies. Among the current fallacies is the belief that the world is slowing down and that there will be less work to be done here after. If 'the lessons of history teach anything at all it is the falsity ot this belief. Human wants are unlimited and insatiable, and means must be contrived to supply ithose wants.