The Guardian And Evening Star, with which is incorporated the West Coast Times. MONDAY, JULY 24, 1933. AN AMERICAN VIEWPOINT.

Hokitika Guardian, 24 July 1933, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. MONDAY, JULY 24, 1933. AN AMERICAN VIEWPOINT.

A pew weeks before his inauguration, President Roosevelt put" aside the war debts question with the remark,: “It’s not my baby.” It is sard, however, that a few days later he observed: “I realise that my administration will be made or marred by its handling of the debt issue.’’ As an American, and a New Englander/ \\Frank H. Simonds is able (says a 'Sydney paper), to talk frankly about* the war debts. If a European wrote like that his remarliG might appear to be mere propaganda. Frank Simonds is very trank in “America Must Cancel.” As Sir Philip Gibbs says'in-a foreword: “It is our case, but! no one on this eide has presented it with anything like the same clarity and unanswerable logic.” The author claims that when the late Calvin Ccolidge said: '.‘Well, they hired the money, didn’t they?” he gave exact expression to the views of most of his countrymen about the origin of the war debts. But “he also put in sunple form the greatest of the seven deadly delusions which have brought confusion to the minds of the American people in the matter of war debts,” What the Allies wanted from the United States was not money, but materials. To be sure, hero was a price tag attached to every article ‘sent across the Atlantic, and since the Allies were not able to pay in cash for most of these things the sum total of the price tags appeared as war debts, When a man “hires money” he usually does it with the idea of putting it to work to earn or create new wealth. What became of all the goods that the Allies bought, mostly on credit, from the United States? With minor exceptions, they were used up in winning the war. When the war had been won there was little or nothing left of them. And things borrowed after the Armistice were mostly used up in relieving population still suffering from the catastrophe of .the war. In the United ‘States itself the Government borrowed from one set of American citizens to pay another for the things sent to Europe. While Coolidge voiced one delusion the second was expressed by the Congressmen, who said: “They could nay if they wanted to.” There is no international money in which such debts can be paid. The supply of gold is limited and largely cornered.**' And the United States, as a Protectionist country, would not take payment in goods. Mr Simonds argues, with a good deal of logic, that the United States was never really willing to be paid. That is, she would not take payment in the only things that most of her debtors really had to offer. He argues, , too, that the Hoover Moratorium did not, as commonly supposed. interrupt a process of payment

that had been going on steadily up to that time, l'n practice, he says, the United States was taking the money out of one pocket and putting it in the other. She was lending money to Germany. Then Germany wae, with the help of these borrowings, paying reparations. And out of the reparations the Allies were paying the United States. So the American investor .and taxpayer was paying.- the war debts bv iyvesting in German securities. This game of “ring-a-round-the rosy” might hav- gone on merrily for mite a while if first the boom and then the panic in America had not put, a stop to foreign investments of this kind. When the American investor bought no more German securities the German Government paid no more reparations and the Allies began to stop paving interest on war debts. It has been suggested, amongst other thinge, that the United States might collect a few islands from

its debtors. The author points out, wry logically, that the United States is just now trying to divest itself of a thousand islands in the Philippines. Why should it want another lot? Ee,sides the United .States has in the Stimson Doctrine declared its opposition to annexations haw'd on force, ami at Paris it spoke for sdfdfttei niination. According to -Mi. Simonds, the inhabitants of the British and French islands in the West Indies would be violently opposed to annexation by the United States. The conclusion arrived at is that for all practical purposes the war debts are as dead as Fenian bonds or Confederate securities. Cancellation is not “fair,” but then the war was not fair either. All that has to he decided is whether the war debts shall be buried decently or whether there shall be a Donnybrook fair over the funeral. For the. rest, Mr Siinonds quite reasonably dees not claim that a solution of the war debts problem will ensure a speedy return to prosperity either at home or abroad. As he says, the removal of the debris of an accident from the tracks of a. railway does not ensure a speedy resumption of traffic. It does, however, clear the road that has been hopelessly blocked.