The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-07-27
PRESIDENT PADEReWsKI of POLANp
Declares Every European Credit Is in
Critical State, but Says There Is No
Lack of Sound Basis and Amer
lea Cannot Afford to Keep
Her Dollars at Home
y INTERNATIONAL s,u.s ssswes

cent Oh the total war cost was pro-
vided from revenue.
At the outbreak Of the war the
British national debt was E645, 900 900,
On March 81, 1919, 1t was f7,435. 00O,-
900, of which f6,OS5. OO0. 900 was inter-
nal and 1880, 100000 external. The
forecast for the year ending March
81, 1920, indicates an expenditure Of
| e, 435 100000, and a revenue Of fl,-
160. 100000 with a deficit to be met
! by borrowing of f275.000.0 200. although
the Chancellor prefers to make q safer
estimate and put tho new loans neces-
sary as totalling three hundred mil
| lion pounds.
That does not measure the borrow
ing the Treasury faces. however. The
! floating debt on March 81 amounted
to f1.412 100000. Most of this is in
three months Treasury bills, and con-
slant appeals to the market must be
made to renew these floating obliga-
tons. On top Of this are the national
currency notes, demand obligations of
the Government in the form of circu-
lating notes, which on April 20, 1919
| stood at f349.000, 900, and were sup
ported by a gold reserve of f2S.500,-
| 900. Their amount is steadily rising.
The aggregate amount of legal tender
money OF England, which at the be-
ginning of the war was f214.000. 900. Is
now more than 100000.
These figures take no account of
the obligations owed to England by
her allies and Dominions. Jysese obli-
cations on March 81, 1919, amounted
to f1,734, 100000.
Fictitious Wealth.
AS Mr.. Chamberlain wisely OBJ
serves. the hard. memorable economic
facts of Great Britain's financial po-
sition are obscured by a fictitious APP
pearance of wealth, There is between
two and three times as much legal
tender money in circulation as there
was before the war. The deposits of
the joint stock banks have more than
doubled. Almost all of their additional
deposits are represented In their port
folios by short dated Government Sc
curities. The average figures indicate
that about 46 per cent. Of British
bank portfolios are in Government OBJ
legations. The great French banks by
comparison show about so per cent.
of their portfolios in Government
paper
1 am not going to burden these
pages with any statistical analysis of
the financial position of the various
Governments. The position of every
one of them that was directly in
volved in the war may be frankly nc
cepted as critical To England one
Hxh hA
difficult" than Critical" but as for
the rest, the position OF the domestic
bond holder gives promise of unpleas-
ant eventualities either In the way OF
scaled obligations or depreciation of
the currency In which the debt is
measured. or OF such a direct tan as
the voters Of Switzerland have Just
imposed. NJ. Klotz the Finance Min
lister OF France, without. one fears, a
clear economic understanding of the
problem, proposed a capital tax in
France. The proposition met with
such a roar OF opposition that 1t was
dropped almost as soon as IT was pro-
posed.
In the chapter on France / have
given some indication OF the national
financial burdens. In Italy the ma
tional debt Ia less. but its crushing
weight is proportionately as great.
particularly in view OF Italy's COM
parative poverty in natural resources.
When we turn our attention to Poland.
Lithuania, Czecho-S!ovalSia, Jugo-
siavonia. and Greece. to say nothing
of Germany. Austria and Turkey, the
situation presented in each case is
desperate, Just how desperate no one
could measure, because to-day no one