The Birmingham age-herald. [volume] (Birmingham, Ala.) 1902-1950, 1919-11-08
ECONOMIST CLAIMS
EUROPE IS VERY AR
FROM BANKRUPTCY
Shows HOwVarious Nations
Are Able to Pay for
What They Buy in
America
By F. w. PETHIcK LAWRENCE

Of w. Pethick Lawrence. author
of "A Levy on Capital" the book
thai started serious discussion of
that proposal is n his way to lee
ture in the United States He was
an intimate friend and adviser Of
Mr.. Lloyd George when the prime
minister was a radical. Mrs.
Pethick Lawrence was leader of
the suffragettes until the Pank-
hurst fire and the sword" policy
captured them)
London, october 25.-(Reciprocal
News Service)-One thing. we are
told. holds back the great rush of
goods across the Atlantic--the doubt
in the minds of the American business
man whether Europe can pay.
The pessimists shake their heads and
add up the national debts in dollars of
the principal European countries
Britain $40, 600 900, 900, France $4,000
600, 600. Germany s4o.o0o,OO0.00o. and
so or. totaling for the whole of Eu-
rope something like 100000, 900, 600,
They are doubtful they tell US,
whether the wealth of Europe is
enough to cover this enormous sum.
And if it is not. does it not follow.
they say, that there is certain to be
general bankruptcy and population?
There is always a risk ip applying
to nations words which<in their orig
inal meaning are used for individuals.
Bankruptcy Everyone understands
what it means when it is said that -
individual is bankrupt. 1t is when the
money he owes to other people exceeds
all the money that he can obtain by
realizing all his assets. So 1t is argued
that nation woulo be bankrupt If
its national debt exceeded the value of
its tangible material wealth. But in
fact that is not So ror the bulk of a
other people. but to its own citizens;
and this part must not be counted in
for the question of real national bank
ruptcy.
Take the case of Britain. whose ma
teriai wealth before the war was reek-
oned at about $50, oooso0,0 900. Its ma
tiona1 debt today is about $40 ,o0o,-
900, but of this over $4,000, 900, 600 is
held by British citizens Only the
$4,000. 900. 900 or s7.ooo,ooo,ooo owed to
America and the much smaller
amounts owed to few other countries
must be reckoned when the question
of national bankruptcy is at stake.
Moreover, there are debts OF several
billions owed to Britain by other coun-
tries. Britain is. therefore, overwhelm-
ingly solvent.
The same is true 90 a lesser degree
of Europe as a whole. From the point
of view of America the essential fact
is not the gross sum of the national
debts but that part of the debts which
is owed to America and American ctti-
zens by European governments and
their peoples The total OF these Is
certainly less than s20,00o,00o. 600 and
is probably not nearly so much.
Against this the total wealth of Eu-
rope was reckoned at s365,o00, 100000
Just before the war. and in spite of
the great destruction of the war 1t is
probably fust as high today. owing to
the increased prices in which this
wealth is measured.
Is the situation then entirely free
from anxiety? BY no means. For, as
Mr. Vanderlip shows in his recent I'M
portant book the danger lies not so
much in national bankruptcies as in
complete breakdown of the whole
production machinery of Europe. I'm