New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-07-15
Secretary Mellon Reveals
Suggestions by Lloyd
George and Exchequer
Head in Wilson Regime
Sought to Steady
World Situation
England Willing to Drop
Own Loans to Others
if America Followed

I'O"' 4 roc 1ItOuWC w GSHtnQLOn bureau
WASHINGTON. July 14.-Secretary
of the Treasury Mellon, appearing be-
fore the Senate Finance Committee to-
day in behalf of the refunding bill re-
Gently introduced by Senator Penrose,
Informed the committee that Great
Britain had on two occasions broached
to this government the cancellation of
the inter-Allied war debts.
The Chancellor of the British Ex-
chequer at that time, Austen Chamber
lain, on February s, 1919, in a cable
gram to R. c. Lindsay, representative
of the British Treasury in America,
said Great Britain would welcome "a
general cancellation of inter-govern-
mental war debts" The cablegram
later was informally turned over to
Assistant Secretary of the Treasury
Lef1ingwell who was in charge of for
eign debt matters for this governm ent.
The British Premier, Lloyd George,
in letter to President Wilson in Au-
gust, 1920, referred to the suggestion
that the United States consent to gen
eral remission Of the war debts with n
view to scaling down the German in
demnity.
Urged as Stabilizer
The cablegram of the British Chan
cellor of the Exchequer, Austen Cham
berlain, favored cancellation of debts in
order to stabilize world finances, and
said:
Turning to the more general con-
siasrations, it is evident that financial
crisis in America would greatly en-
danger the incipient recovery of Con-
tinental Europe. 1t is impossible to
foresee the consequences. With the
Continent prey to bankruptcy and
anarchy and the United States unable
to provide credits of any sort owing to
the internal crisis the worlds position
would be indeed serious. If may VEN
ture on what | fear is controversial
ground may say that it is largely be-
cause of these dangers that we should
welcome a general cancellation of in
ter governmental war debts. The moral
effect would be even greater practical
change, and fresh hope and confidence
would spring up everywhere.
THE existence of these international
debts deters neutrals from giving as
slstance, checks private credits, and
Will, | fear, prove a disturbing factor
in future international relations"
Text of Premier's Letter
The full text of the excerpt of Pre-
mier Lloyd Georges letter as read to
the committee follows:
II come now to the other question
wish to write to you about and that is
the knotty problem of Inter-Allied in
debtedness. Indeed, l promised Mr.
Rathbone (the American unofficial rep
resentative on the Reparations Com.
mission) long ago that l would write
to you about it, but l have had to put
it off for one reason and another till
now
"The British and French govern
ments have been discussing during the
last four months the question of Civ.
ing fixity and definiteness to Germany's
reparations obligations. The British
government has stood steadily by the
view that it was vital that Germany's
liabilities should be fixed at q figure
which it was within her reasonable
capacity to pay, and that this figure
should be fixed without delay because
the reconstruction of Central Europe
could not begin nor could the Allie:
| themselves raise money on the strength
| of Germany's obligation to pay then
exactly defined.
"After great difficulties with his owl
people, M. Millerand found himself un
| able to accept this view, but he pointed
out that it was impossible for Franc,
to agree to accept anything less than i
was entitled to under the treaty unless
| its debts to its allies and associates
were treated in the same way.
Wished Settlement General
"This declaration appeared to tn,
British government eminently fair. bu
after careful consideration they cam,
to the conclusion that it was impossibl,
to remit any part of what was owed tt
them by France except as part ant
parcel Of all-around settlement of in
ter-Allied indebtedness.
"T need not go into the reasons
(Csutinued on paso three)
BE III VVTv TJ