New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-09-18
England Banker for Allies.


England Banker for Allies.
England herself has realized that
situation. She has given up the ambi-
tion to be the great centre of interna-
tional trade by proposing a boycott
after the war of the Central Powers
and their allies. She is willing 10 play
q more humber part and 10 take far
more risky role. From the banker OF
the world she has become the manager
of the Allies financial syndicate and
the creditor of bankrupt states -Por-
tugal. Servia, Italy. Belgium, France
and Russia. As far as France is con-
oerned, the reputed richest country in
the world. she has been sad dsap-
pointment TO her friends. From a mill
tary viewpoint she has done wonders;
financially she has failed Her fnan-
cial straits started before the begin
ming of the war, as her market was
inundated by Russian loans. For, as
England is the banker Of the Allies,
France was the banker of Russia.
Russia is the typical debtor state in
Europe which has to remit large sums
every year TO its creditors abroad. As
a rul. her exports surpass her imports
considerably between s75,200,000 to
1929, 100000 three years before the
war;. This is her only means of pay
ing interest. Whenever her crops are
bad her exports fall off. She then has
financial difficulties and the ruble de-
clnes, for she has nothing to pay the
interest with, which is due abroad, ex-
cept the proceeds Of a new loan. Be-
fore the war the Russian national debt
was s.900,00O,0O0 rubles. The yearly
interest was about 400,000,000 rubles;
about 300 100000 rubles had to be paid
abroad. The war has added 9,26l, 000,-
eco rubles up 10 the end of 1915 and
1.753O00,000 rubles were borrowed
abroad, bringing Russa's foreign in
terest charge to at least 400.0O0,O00
rubles.
Most Of Russia's foreign loans are
payable in gold or in foreign currency.
Whenever the ruble declines the cost Of
RENTING in foreign currency increases.
When the rube is at par the payment
Of interest abroad would amount to
400. 100000 rubles When the ruble has
fallen to about 30.5 cents, as it has
done lately, the cost of renting 4OO,-
600, 900 rubles in gold will be 6sO.OOO,-
600 rubles currency. As Russia's credit
balance excess of exports over i'm
ports) in her best year was only 43O,-
100000 rubles, she has nothing with
which to pay the interest on her for
eign debt, which has grown TO nearly
700. 900, 900 rubles, and besides that
huge item she has TO pay interest on
private investments abroad. She has
lost some Of her most fourishing prov
inces, and her internal debt has grown
to $4,000 900 rubles. (b). 1t is well
known that by far the greatest part OF
her foreign private and public debt is
in the hands of the French people; only
lately England has taken a share.
The finances of France are dependent
on the finances of Russia. and since
England has become the banker Of the
Allies. her own financial prosperity is
involved. No doubt England makes
some profit on the $4,000, 100000 she has
advanced TO them. She sells them steel.
etc, for the making of ammunition at
the rate of s3o,0O0,0OO a month. Are
her investments with the Allies quite
safe? After all, the Central Powers
hold the real security on which Eng
land has lent the money: Kurland Po-
land, Livland. Belgium, Serbia. Albania
and Northern France. England holds
nothing but their unsecured promissory
notes. There is no doubt Russia is a
big country, with great natural re-
sources. Is she going TO sacrifice the
development Of these resources TO the
interest of her foreign creditors? After
all. the Russians will say that they did
the fighting and that others lent the
cash. Are they TO go on paying in
money after they have been paying in
blood?
As time goes on. no doubt. the bur
dens of the war become heavier for all
nations concerned. The Allies are get
ting more indebted TO each other and
to foreign powers. German finance is
merely n German problem. When the
war is over the German people will not
be indebted 20 foreign nations. They
will not have TO send abroad a large
share of their annual produce in pay
ment Of their war debt. Agitators can
not 20 amongst them telling them that
their burden could easily be relieved II
only the payments TO foreign capital
lists were stopped. They cannot be told
that reputation is the surest way TO
financial independence. And the Ger
mans themselves will not be divided
into two nations: Those who have in
vested in the funds and those who have
TO pay interest. Their loans have been
national loans. where all are creditors
and all are debtors. There is no rea-
son for internal dissension and for
financial dishonesty. as there must be
in countries where. internal loans are
held by the rich and where large