The Brattleboro daily reformer. (Brattleboro, Vt.) 1913-1955, 1918-05-04

qucrcd territory, but it has helpcd the
fiscal situation III Germany by gather
ing IN the great German banks more
gold to protect her own inflated cur
rency.
In connection with the fnancial.treat
ment of conquered territory. if is inter
esting to note that issue banks have
been established in Brussels, mad also
in Warsaw, which issue notes against
an equal value of marks deposited in
the reichstag. In Poland it has been
directed by the Hun authorities that
ITO payment of any kind shall be made
except in Polish paper money. Thus
the gold and the marks exchanged for
this paper money are gradually with
drawn TO Germany. In Belgium the cx-
port of any gold and marks to anv
country except Germany is strictly for
hidden, and violation of this rule is
punishable by heavy penalties. Pre-
cisely the same program has been fol
lowed in the occupied territory of Ru-
mania and Serbia
The effect of this is to leave the con
quercd territory entirely dependent fl
nanciallv on Germany. Not only is this
true today, but the effect of the Ger
man plan is to make it possibly true
after the war, no matter who wins.
Suppose. by flight of the imagination
that Germany wins and decides to hold
territory she occupies. The value of the
paper money comprising almost the
sole currency of the conquered terri
tories would have no other basis than a
credit in marks deposited within Ger
many and in the control Of Germany.
Now, deal with an allied victory. Au-
tomatically, the credit of the conquered
territory is affected directly by the fall
of reichstag credit, which would be
possibly an immediate result of Ger
man defeat Not only this. but if the
rclchstag. under the thumb of the kai-
ser, should see fit, in the case either OF
German defeat or victory, to cance'
its obligations in the conquered terri
tories the paper money issued there
would be absolutely worthless In ad
dition, Germany would gain reduc
tlon OF her own excessive circulation
through the decrease of her obligations
There is excellent reason to suppose
that fiscal conditions have much to Dc
with the attitude of Germany 5 allie.
in sticking to the war. Austria Ions
| ago allowed her entire gold reserve K
be transferred to Germany. She begaI
and has continued the issue of an enor
| nous paper money circulation, which
| in reality, is based on gold now in Ger
many. The Turkish government ha
| been forced by the kaiser to buy Ger
man bonds, paying for them in gold
| The Ottoman fiscal machine toda,
works on an issue of 129,000,000 pound
of paper money issued against tn
German bonds which she holds, Will
Germany holds Turkey 5 gold. TIL
Turkish pound is worth about $4.43.
Take the case of Bulgaria. Tha
country more than year ago had i
sued 3Ss 100000 levas of paper none
against German bonds, and now no
only Bulgarian gold paid for the bond
is in Germany, but German banker
hold the bonds themselves. Bulgari
got into SO much internal difficult
with her own paper money that tn
army had been importing German bank
notes for its use. \ recent German OF
der forbade the further importation o
German banknotes by Bulgaria. TIL
leya is worth about % cents, America
money.
! Now, suppose Austria, Turkey or Bu
garia,, or all three, should start pegQtia
tons for a separate peace. German
could cancel obligations in such wa
as to leave each and all of her allie
without gold and without any tisca
system.
In word, the result of Germany
war financial policy has been not onl
to enmesh conquered territory final
cially but it has enabled Berlin to hol
over the heads Of Germany allies
financial club of such proportions as t
make them ever wary of taking steI
toward a separate peace, lest German
in retaliation cancel her obligations an
bankrupt her former allies.
OF course, when the allies have wol
il Will be settled at the peace table tina
Germany viii do no such thing, but til
situation is presented as offering on
more additional reason why the futui
economic welfare of tho world, not onl
Of allied and neutral nations but {
Germany S own allies, demands that W