New-York tribune., 1917-06-23

tons. upset the financial plans OF tne
Dominion government. IL Is under-
stood that Sir Thomas White had peer
intending to seek large loan IN New
York this month. Under present COZ
ditions il was, of course, impossible 20
do so. and the Minister OF Finance had
10 turn again 10 the Canadian banks
which advanced S75,000,000 more 10
finance imperial munitions orders IN
Canada.
When the United States first allied
itself With the nations az war against
the Central Powers extravagant and
absolutely impossible hopes were en-
tertained that this country would De
permitted 10 share in American credits
and that money could be secured for
national purposes other than war
needs. Instead. financing even OF war
requirements has been made much
more difficult. One outstanding result
of the changed situation is that the
government has been obliged 10 defer
action until after the war in regard 70
the proposal 70 nationalize the Grand
Trunk. Grand Trunk Pacific and Cana
dian Northern Railway systems, as
recommended in the recent Drayton-
Acworth report.
Municipal Developments Postponed
At present only small amounts can
be borrowed in the United States and
even such loans can be placed only
under guarantee that they will be used
for war purposes There is much con-
Germ in Canada over the intimatlon
from Washington that no foreign
financing will be permitted for the re-
naming period of the war. Several
municipalities are hoping, now that the
Liberty Loan is out of the way. TO be
able to arrange necessary loans before
Washington brings such a prohibition
into actual operation.
The curtailment of borrowing priv
leges of Canadian municipalities may
easily be a blessing in disguise, al
though inconvenience undoubtedly will
be caused in some cases. The capital
needs of the provincial governments
will be reduced to a minimum by the
postponement of development plans
and they will not have to borrow very
large amounts. SO far as the Dominion
government is concerned a new domes-
tic loan. perhaps larger than any of
those already issued, appears to be
certain in the fail Fortunately, the
Dominion's financial position is excep-
strong.
Canadian Pacific Lender
The terms under which the American
government is extending credits 70 the
Allies apparently require that the
money thus provided be spent in the
United States. In consequence. Canada
is left TO finance all orders TO plants
in the Dominion. That money is IN
demand is indicated by the announce
ment that the Canadian Pacific Rail-
way has loaned Sl0,000000 to the I'M
pcrial Munitions Board.
Canada to-day has a remarkably
large and efficient organization for the
manufacture Of munitions. and the sup
ply from Canada is by no means an un-
important part Of that consumed on
the Western battlefront. In the in
tcrests of all The allied nations. includ-
ing the United States, such supply
should be continued and even in
creased. IL would be most regrettable
if Canada's output of munitions should
be curtailed by reason of shortage
OF money, or even one plant made idle
because the Dominion could not con
tinue 10 finance its own war needs and
also provide credits for the Imperial
Munitions Board Your correspondent
does not mean 10 say that such curtail-
ment OF Canadian munitions rroduc-
tion is imminent. because the posi-
bilities Of every recourse would be ex-
hausted before such a condition would
be allowed TO develop.
Restricted Loans Suggested
But money is needed in Canada 10
continue its war contribution more
money. in fact. than can be raised AT
home without very great sacrifices. The
United States could render valuable
service 10 the Allied cause by permit
ting the Canadian government 10 offer
war loans. TO limited amount and ur-
der certain other restrictions, in the
United States.
An alternative plan would be TO permit
the expenditure in Canada in payment
for war purchases of money loaned to
the Allied governments, instead of con-
fning the use Of such money to the
United States. In many other respects
Canada and the neiGhboring republic
are being organized as a single eco
uomic unit for the more effective prose-
cution of the war, and the action pro
posed above would he a natural extern
sion of the economic unit idea. Moth
ing could be more certain than that
Canadians would appreciate such ar
expression of good will toward their
country and wholc-hearted devotion TO
the cause for which the Allies are
fghting. The financial assistance suc-
gested would be accepted as furthe'
proof Of Americas generous recogni-
ton of Canada's noble part in the war
4 d. T. D.