The sun., 1919-05-28
OWEN HAS PLAN TO
AID FOREIGN TRADE
Suggests Corporation With
S1,OOO,OO0,OOO Capital to
Give Long Credits.
SEES EXCHANGE DANGER
Company Would Be Financed
by U. s. Government, Banks
and the Public.
SEES EXCHANGE DANGER
Special DespatcA 70 THE sux

cpectut DcSputCh 70 IHb sun.
WASHINGTON, May 27.-Creation OF a
powerful foreign finance corporation,
which would extend long time credits to
foreign purchasers of American goods,
making market for them and helping
TO stabilize exchanges is suggested in
statement issued tonight by Senator
owen (Okla), retiring chairman of the
Banking and Currency Committee. He
points out the danger in the continued
folling of American exchange rate for
British, French and italian money saw
ini, that unless the rates are brought
nearer to par this nation will face over
production with no market In which IN
sell It's surplus goods and that extension
OF credit to foreign buyers also will tend
to restore normal conditions on the con-
tirent
Although he does not mention the far,
In his statement. 1t became known TO-
night that Senator Owen has discussed
his proposal with Secretary Glass of the
Treasury Department and Gov. HARDING
and other members of the Federal RE-
serve Board. The Oklahoma Senator
proposed a corporation with a $1,000
oCo,ooo capital. of which the Unietd
States would take S250,000. 900. the
banks of the country s250,o00, 900 and
the public 100000, 900. Although he
has not been advised finally as to the
Governments position he was of the
opinion tonight that the Reserve Roar I'd
Is not In line with the suggestion. min
cipally because of the financial partici-
patton OF the Government. Legislation
III me Win the senator's plan probably
VII. De introduced In the Senate soon
Senator Owen said in his statement !.
i was much pleased with Frank A.
Nanderlip's speech at the Hotel Astoria
last night in which he empha sized the
great Importance of extending credits
10 Europe. Vanderlip Is right. Europe
cannot pay at this moment in terms Of
gold or commodities for American ex-
ports.
Peace OF World Threatened,
We have billions of dollars of sur-
pius goods which we desire to market
and an enormous cotton and wheat crop,
vast supplies of copper. of steel, of oil.
or machinery, of manufactured goods. of
primary raw materials, such as lumber
and coal.
Europe is in dire distress. and Europe
with 3OO.000,000 people and vast r,.
sources has an enormous productive
power If society could be stabilized
and men and women given the opportu-
nifty to create values by their labor they
can create billions of values IL employed.
IL not employed. Bolshevism and Social
ism will grow and will affect the peace
and stability of the whole world and
VIII have bad effect upon conditions
in America
III We do not sell our surplus products
we Will have a reaction upon the value
OF these commodities in America. We
VIII have stagnation. We will have I'M
employment growing as dangerous
problem and exciting riots and political
unrest within our own body polite
NO apprehension whatever may be
feared that Europe IL given aid cannot
repay fully and completely every dollar
or credit extended. We need to extend
these credits. First. for the sake of our
own commerce second. TO prevent a
break In American prices third, to pre-
vent unemployment in America fourth
TO preserve and extend American pres
tige; fifth. to expand American COM
merce and industry: sixth, to protect
loans already made, which amount to
$4,000, 200. 900, and to secure an earlier
settlement Of these loans: seventh, to
iced Europe and put the people there on
q quicker productive basis; eighth, to
stop discomfort in Europe-to establish
the peace of mind of the people Of Eu-
rope and therefore check rioting, Boil
shevism and political disturbances. This
is the true way in which to promote In
ternat!onal peace.
Europe Needs Americas Help.
1T is even more important in estab-
nsning International peace than a reso-
luton of peace and good will. 1t will
be very important, of course, to declare
treaty Of peace, but It is equally i'm
DOFtanf h,,
food, clothing and shelter and profitable
employment
The European people are anxious to
get to work and need the help of Amer
lea Since these credits ought to be ex-
tended and must be extended the prac-
teal problem for American statesmen is
how to do it. A great many men will
tell how not to do 1t; a great many men
viii offer serious objections to whatever
constructive plan is proposed.
My own opinion is that there should
be established Immediately a very DOW
erful foreign finance corporation with
ample capital with which to extend these
credits on long time on the basis of Eu-
ropean securities, and that such a cor
poration should have authority TO sell its
bonds secured by foreign bonds, foreign
securities which are sound, as the bonds
OF foreign governments. foreign cities
IKE tnoSe OF Paris, bordeaux ana Lyons,
the securities of commercial syndicates
engaged in certain productive enter
prices backed by government securities
whenever available and by the securi-
ties Of we'll known concerns engaged in
productive enterprises.
Il have seen evidence that italian i'm
port license boards and the French i'm
port license boards are at this time re-
strictng imports from America, and
Great Britain is pursuing the same pol
fey. for the very sound reason that no
arrangements have been made by which
TO extend time credits which are essen
tial 10 protect these people In their pur-
chases
THE lack OF long time loans by Amer
lea to these countries has resulted In the
steadily lowering exchange with Great
Britain and France and Italy. Last
week I observed that italian exchange
had dropped from the former rate OF ex-
change of Sis lire to the dollar to SEQ
TO the dollar. so that an Italian mer-
chant buying American goods on this
rate of exchange would be losing over 80
per cent on each transaction. This IL
an impossible rate. The American mer-
chant does not gain by this; the italian
merchant and the Italian consumer suf-
fer a dreadful loss.
''The bankers who handle this ex-
change are themselves inundated be-