New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-06-24
Harding's Measure Gives
Mellon Authority to
Dispose of 10 Billion
Bonds as He Sees Fit
Public Hearings
Begin Wednesday
Secretary Would Have
Power to Extend or to
Convert Amy Obligation
From The Tribunc's Washington Bureau


WASHINGTON, June 23.-The Ad-
ministration bill to enable the refund
ing Of the obligations of the foreign
governments to the United States,
amounting to more than $4,000 900, 900,
was introduced in the Senate to-day by
Senator Penrose, chairman of the
Finance Committee. The bill is in
tended to clothe Secretary Of the Treas
ury Mellon with sweeping authority to
refund the obligations of the foreign
governments and to adjust claims of
the United States against foreign gov
ernments. 1t is broad enough to per
nit the Secretary of the Treasury to
receive bonds and obligations of "any
foreign government" in substitution
for those now or hereafter held bv this
government.
Senator Penrose introduced the bill
at the request of President Harding.
who in turn acted at the instance of
Secretary Mellon. Senator Penrose
gave the measure his Endorsement and
announced that the Finance Committee
would give public hearing to Secre-
tary Mellon and Treasury experts next
Wednesday morning at 1890.
Indications are the bill will pass
Congress-, although there is likely to
be considerable discussion, especially
in the Senate. The wisdom Of giving
the Secretary the sweeping powers con-
ferred is likely to be thrashed over,
and also the question of whether it is
going to be the policy to sell the
foreign bonds to the people of this
country in such ways as to hurt the
market for industrials and other do
mestic securities.
The measure is entitled "a bill to
enable the refunding of obligations of
1orelgn governments owing to the
United States of America, and for
other purposes" 1t consists of sim
gle paragraph. as follcws:
Text of Bill
"Be it enacted by the Senate and
House of Representatives of the
United States of America, in Congress
assembled, that the Secretary of the
Treasury, with the approval of the
PRESIDENT, is hereby authorized from
time to time to refund or convert and
TO extend the time of payment of the
principal or the interest, or both. of any
obligation of any foreign government
now owing to the United States of
America, or any obligation of any for
clgn government hereafter received by
the United States Of America (in-
Guiding obligations held by the
United States Grain Corporation)
arising out of the European war, into
bonds or other obligations of such, or
of any other, foreign government, and
from time to time to receive bonds and
obligations of any foreign government
IN substitution for those now or here
after held by the United States of
America, in such form and of such
terms, conditions, date or dates of ma
turity and rate or rates of interest,
and with such security, if any, as shall
be deemed for the best interests of
the United States of America. and to
adjust and settle any and all claims
not now represented by bonds or obli-
cations which the United States of
America now has or hereafter may
have against any foreign government
and to accept securities therefor"
President Harding's letter to Sena-
tor Penrose follows in part:
"The Secretary of the Treasury
points out the urgent necessity Of
broad powers granted by the Congress
for the arrangement for the refunding
or conversion or extension of the time
o. payment of principal and interest
on these obligations, and the adjust
ment of other claims of the United
States against foreign governments.
All the circumstances suggest the
grant of broad powers to the Secretary
of the Treasury to handle this problem
in such manner as best to protect
the interests of our government.
II hope your committee and the Con-
gress will find it consistent promptly
to sanction such an act as that sug-
gested by the inclosed draft If the
Congress will promptly sanction such
grant of authority the Secretary Of
the Treasury may proceed to the
prompt exercise of the powers granted
to him and we reasonably may expect
a satisfactory handling Of the obliga-
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