Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1915-09-30
THE WARS STAGGERING FINANCIAL
STAKES.
(From the Montreal Hcrald)

tFrOm the montreal ftCrald.)
Most striking is the reminder which the
imperial governments drastic new taxa
ton gives of the fact that Great Britain
Is financing the fight for the liberty of
the world. France Ia in normal times a
very rich nation, but she has been invest
ing her surplus savings in Russia Rus
STA. too, Ia n rich nation. but her rich
ness lies, likes Canada's, largely in natu-
raj resources, which huge sums have been
invested in developing. France cannot
draw upon her Russian investments TO
pay for the war. Russia cannot. on de-
mand, turn her natural riches into ready
cash to pay for war munitions. Each can
follow the example of Germany and turn
out paper money for domestic use.
Neither can hand out real money for
purchases abroad. But Great Britain can.
and Great Britains realizable cash is so
vast in quantity, so stupendous factor
In the worlds finance. that now, after a
whole year Of cash disbursements on a
scale such as the world never dreamed
Of, British bank notes. alone Of all the
paper money Of the allies, are still re-
deemable In gold.
1t Is calculated that the national income
q year. About two billion dollars of this
Is saved. without counting the billion dol
lars each which she is lending to France
and Russia. her total war expenses are
five billion dollars per annum. OF course,
Brtain's income has been affected by the
war. but not to any alarming extent, since
the British navy enables her foreign trade
to be maintained with a minimum of in
cO Trit y =.
their annual savings by cutting down
| their living expenses, which amount to
, ten billion dollars. by from d to so per
cent. they can thus finance the war with
out calling in foreign aid They have al
ready done this to considerable extent,
ana the new taxation now announced,
with the important provision of an in
crease Of 40 per cent. in the income tax.
will complete the process.
Meanwhile a terrific problem is being
created by the war loans foated by the
belligerents. If the allies win the war,
both France and Russia will be able II
pay Britain the interest on the loans she
has advanced. and ultimately the prn-
cipal as well, and Britain likewise will be
able to repay the loans she has obtained
from her subject. IT, on the other hand
Germany were to win she would be able
to repay the enormous domestic loans
she has hoated on paper that now is
nothing but promissory notes unbacked
| by money She would do this by levyinc
huge indemnities on the allies. Imagna-
ton Is staggered at the contemplation OF
the ruin and downfall which this would
involve on Germany's victims, who would
be called upon not only to bear the whole
cost Of the war; but to pay Germany stu
pendous rewards as well. Not equally APP
palling will be Germany's position If tn
role is reversed. for the allies who rep.
resent civilization. would never in.lic
such cruel conditions as German undoubt
eddy would. But Germanys position
would be one OF staggering ruin none tn,
less. AS one economist has aptly put il
Germany would have nothing but noun
tans of worthless paper for her economic
reconstruction. Few people have finan
cial Imagination enough to foretell wha
| would happen. The bald fact is that from
the banking standpoint Germany is a.
ready insolvent. and her military collapse
would mean national bankruptcy on {
scale such az the world has never seen
The stakes in this war are mounting stu
lpendously every hour More and more /
becomes war to the death.