The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1919-05-24
FUTILE TO AWAIT
LOWER PRICE ERA

John ]. Arnold, vice president OF the
First National Bank of Chicago, at
the solicitation OF the Division OF
Public Works and Construction De-
vehement OF the United States De-
partment OF Labor, has issued 2
statement on Imitation and Prices"
in which he says it is futile for in
dustry to wait for pre-war commo-
dity prices.
The Chicago banker dissents from
the popular opinion that the United
States has become the worlds bank
er," and points out that we are a
creditor nation only and as such our
responsibilities are heavy ones, not
without dangerous possibilities.
'"The situation which confronts US
is serious" says Mr.. Arnold, land it
may be necessary that our Govern
ment accept from the European gov
ernments further government bonds,
or promises to pay, for the interest
which will be due from year to year.
Urges Private Financing.
ut is desirable from every view
point that Government financing
should be discontinued at the earliest
possible moment. Private enterprise
should be stimulated by private
financing, which will most quickly
bring about deflation.
'The high cost OF commodities and
labor, of course, is partly due to the
increased demand for raw materials
and the curtailment Of production for
peace purposes.
The world today is glutted with
Government securities, which include
both bonds and the medium of circu-
lation known as currency, and the
sooner we begin the process OF re-
ducing both the sooner can we figure
on lower cost Of living.
From the standpoint Of the student
or economics, it is absolutely futile
for peace industry to wait longer for
pre-war commodity prices, and every
thing should be done to encourage the
resumption OF peace business, which
alone can accomplish what we all de-
sire.
Mr.. Arnold calls attention to the
fact that increasing loans and de-
posts in equal amounts. without lin
itations, shows no added strength
to an institution and may prove even
dangerous. Loans within the power
to pay are legitimate and reflect,
81
but Mr.. Arnold points out that in
Europe government obligations have
been beyond their ability to pay with
IN a stated period. He calls atten-
ton, also, to the fact that much of
the governmental borrowing has been
for destruction rather than construc-
ton, and, therefore, much OF the
money in these loans has been spent
for things which produce TO wealth
and have no earning power
Suggests Rehabilitation Fund.
Mr.. Arnold suggests that the United
States use the interest paid by foreign
countries on their loans for a "reha b.
fund 10 be spent in Europe
which would mean that for the period
OF time required for the rebuilding Of
Europe We would be loaninE our
funds without interest.
think IL is generally admitted
says Mr.. Arnold, that the greatest
investment We. as a country. have
ever made was wnen we remfffed
China the amount of the Boxer INK
demnity. This has brought about an
understanding between China and
and a relation of friend shin
which could not have been acconp Il
lished in so short time in any>o thet
way A contribution such as I am
suggesting would forever eliminate
the charge Of dollar diplomacy, in
our international life, but even aside
from the harvest which We would he
likely TO reap in friendship, am
confident that in the long run IL
would prove profitable even In dol
lars and cents"