The Daily News. WEDNESDAY, DECEMBER 21, 1921. GERMAN FINANCIAL STRATEGY.

Taranaki Daily News, 21 December 1921, Page 4

The Daily News. WEDNESDAY, DECEMBER 21, 1921. GERMAN FINANCIAL STRATEGY.

German policy is, and has been, remarkable for opportunism. Sometimes it succeeds, and at oth-, ers failure happens, yet all the while her astute and not too scrupulous responsible authorities are striving to gain an advantage, though invariably prepared, on being pressed, to resort to the tactics familiar in the war—“retiring to pre-arranged positions.” The discharge of her financial obligations to the Allies has been a matter wherein Germany has persistently adopted a course necessitating the constant application of pressure and the adoption of coercion. The Allies have found it necessary to keep a very elose watch over every phase of her financial position consequent on the defiant attitude of her industrial magnates, led by Herr Stinnes, who is described as “the Czar of New Germany.” His defiant utterances at the Spa Conference, as well as in subsequent speeches, are summed up in Dr. Brinkmeyer’s book “Hugo Stinnes” in the phrase ‘ ‘ Germany shan’tpay. ’ ’ The gre.at German industrial interests, asserted the French Premier in,

October last, organised the bankruptcy of their country in order to bring into operation the dangerous Article 234 of the Peace Treaty (which refers to the possible extension of dates for payment in view of Germany’s resources and capacity), but M. Briand claimed that Germany was under the obligation to use her whole national fortune, as well as that of her citizens, in order to meet her responsibilities to the Allies. Yet her great industrial interests have been exporting goods and capital, not only to avoid paying their country’s debts, but also in order to oust the Government from power. According to a statement made by the Secretary to the British Treasury two months ago, Britain had received from Germany, up to September 30 last, £5,444,000 in repayment of advances under (lie Spa coal delivery agreement, £38,704,000 on account of the fifty millions duo for the cost of the army of occupation, while a further £4,368,000 was receivable in respect of ships sold, but nothing has been received on ace unit of reparation, which 1 ranks alter the cost of occupation. In the light of these figures it is somewhat of a mystery how Mr Mas sey managed to bring back from England half a million for reparation money, unless a separate payment has been made on the Dominion’s account. That, however, is by the way. The latest) phase of this reparations question is that Germany has advised the Reparations Commission that she is unable to pay the next, two instalments, and has asked for time. Heri- Wirth has stated that the success of the German Government’s attempt to pay the January and February instalments depended on the flotation of a loan, for which the active collaboration of British financiers was essential, but that negotiations to that, erfd had failed, with the result that Germany, even by ignoring her own financial requirements, could not procure more than one hundred and fifty million gold marks in cash, and as these two instalments aggregate seven hundred and fifty million gold marks, while similar difficulties will arise about the payments on subsequent dates, an extension of time was requested. Apparently Herr Wirth and his colleagues considered this.bare statement sufficed to justify new terms, but the Reparations Commission has promptly undeceived them, and has properly intimated that until Germany has submitted a precise statement as to what measures she has taken, in accordance with the Commission’s note of December 2, to ensure the payment of reparations and to restore her financial position, also exactly what she is prepared to pay in January and February, as well as the period of grace needed and the nature of the guarantees offered during any delay . that might be granted, the request will not be considered. France evidently views the possible default very seriously, as she needs money badly, and insists on her right to priority of reparations money for restoring her devastated areas. The Daily Express’ Paris correspondent intimates that France is prepared to take drastic steps in case of Germany’s default-, even to enforcing the military and economic penalties provided for in the terms, and at the risk of breaking th'e Entente. How serious the matter is can be understood by the action France took some time back, when she practically defied the Allies and acted on her own initiative. It would seem that Germany has banked on the success of the Washington Conference and the sacrifices made by the Allies in the cause of peace, and it appears likely that, unless Germany is compelled to carry out her financial obligations, there will be grave trouble. That Germany can pay was the report of the Reparations Commission after a recent visit, to that country. No just cause for delay in payment has been submitted, but there is evidence of reckless expenditure an I the deliberate export of gold. Unless the Allies now show inflexible firmness the Germans will laugh up their sleeves and defy their debtors. It must be remembered that Germany has been freed from the incubus of heavy expenditure on an army and navy, and has been able to devote her man power to industrial production, so that if she cannot pay now there will be little hope of doing so hereafter.