Republican farmer., 1920-05-07
MUST BE STRICT CHECK |OVER ALL BANK CREDIT

New York, April 3o.---The entire world must tighten its belt if there is to be enough for all, and that belt is a strict control of bank credit with out which the world will continue to gorge itself and inf1ate, declared Paul M Warburg, banker, discussing infla- ton, its causes and remedies, before the Academy of Political Science here today.
 In summing up what he termed the practitioners advice in the case, MT. Warburg said:
 First we must fight imitation with all the means at our disposal; by ar resting the further increase of gov i ernment indebtedness, and if possible reducing it.
 Second by calling a halt in further bank credit and note issue expansion. We would thereby destroy the atmosphere of easy money and paper prosperity that makes for indl- vidual and corporate extravaganza and fosters discontent among the masses, rendering them disinclined to give their full measure of work. This includes the most difficult task Of curbing the production of unessen- tials and of stimulating the producr ton of essentials.
 | And finally we must fight rising prices by stimulating essential produc- ] ton both here and abroad, which means that We must furnish Europe | with the materials required in order l to rehabilitate her industries so that
 once more she may become self SUD- l porting. As far as this involves the
 granting of the further credits, it
 should be our determined purpose to provide them from our savings Ii 1 irr6SDOnSlDl
 to accomplish this we must submit
 to paying for the unsaved balance by
 imitation. That would prove, as we
 have seen, a wastefu1 and highly re-
 grettable alternative, but it is easier
 for us to bear the sacrifice than fo1
 Europe"
 Increase of government indebted
 ness must be arrested, MT. Warburg
 said, and national budgets must be 5 balanced by reduction of expenditure;
 and decrease of revenues.
 : '"The inordinate demand for thing must be met by increased production , and by greater moderation in the ex
 travagant consumption of goods" h. :, continued. Banking imitation mus Q be combatted by an earnest attemp , to re-establish and preserve tn
 healthy check placed upon us by ' conscientious observance of our gok
 obligations, which implies stricte :. control over bank loans and greate : effort to liquidate by savings, excess1V i commercial and governmental loans. S Prediction that Italy will be tn - first big continental country Il = Europe to reach the balance of he e budget, was made by Professor B. At = tohco, Italian commissioner genera
 for finance to the United States. HI 1 far a nreS6nt
 b1e fully warrant that execution. Sine
 the armistice, he asserted, the Italian
 commercial balance is improving mos encouragingly, and he read statistic bearing out his contention. The government of the Unitet States tis deadlocked against itself,
 Government of obstruction" Assistan
 Secretary LeffingwelI of the Treasur, '- declared. Failure of the governmen a to deal in a constructive way Wltl - any one of the vital national problem
 he attributed largely to the fact tha the government is divided against IL l. self''
 q Tt. is at least questionable" MT ILefhngweu continued, whether tn
 progress of reaction would have Deel e so complete or so disastrous If ou s institutions had not given this conn P try, during the most critical period O the worlds history, a government al 3, vided against itself and therefore Tn ,e capable of effective leadership In na
 tional or international affairs.
 "At this most critical moment
 the history of Europe, when ou
 financial and economic stake in Euro + ope's affairs is so great that dlsasre l. there could mean only disaster her' le many of our people have turned gam l. blers and wasters.
 d For plain living and high think1n
 we have substituted wasting and DICK