Evening star., 1921-05-03
TRANSFER OF DEBT
0FALL|ES OPPOSED
u. S. Considers Proposal by
Germany to Take 1t Over
Unacceptable.
BY DAVID LAWRENCE.

The United States government con-
siders the allied debt Of ten billion
dollars a just obligation of the allies,
and deems unacceptable the sug-
gestion made by Germany that she
take it over as part payment of repa-
rations to France. Great Britain, Italy
and Belgium.
This attitude on the part of the
American government may be for
mally expressed if the United States
ever transmits the recent German
reparation proposal to the allies as
basis for discussion, but inaSmuCh as
such Il step is for the moment unlike
ly, the chances are that America Will
avoid formal comment on the German
proposition as it affects our foreign
loans.
While the Washington government
is vitality interested in the outcome OF
the reparatiOu negotiations because
of the far-reaching effect that set
tlcfncnt would have on the worlds
economic situation, the official view
point here is that the allies will be
well able ultimately to pay their debts
to the United States irrespective of
the reparation money forthcoming
from Germany to the allies. II is
realized that a satisfactory settle
ment of the reparation controversy
would assist the allies and strengthen
their financial power to pay the
United States. but there is no disposi-
tion TO regard the reparation situation
as affecting the payment of the allies
debt to the United States.
The government here regards the
debt as something between the Unit
Il States and the allies. and as in no
way dependent upon what sources OF
revenue the allies may develop for
the payment of any of their debts, eN-
ternal or internal.
V;x;,ps Thinks DehtS .JuSt
It became known today, incidentally.
that former Premier Viviani on his
recent trip to the United States took
occasion to advise the American gov
ernment that France considers her debt
just obligation and that she had
every expectation of paying it at the
earliest possible moment.
The British government has SINH
larly expressed itself in informal dis
cussion. There have indeed been no
suggestions official or unofficial eX-
Cept that from Germany, since the
Harding administration came into
power. looking toward the cancellation
or discounting of any of the foreign
debts growing out of the war. Nego-
tiations are about to begin with Great
Britain for the funding of the interest
and principal in such a way as Will
enable Great Britain to distribute her
annual payments to the satisfaction
of the United States.
Although the British cannot pay
much either on the interest or prin-
cipal for the next few years, our gov
ernment is just .aS well pleased, be-
cause any huge shipment of gold
would tend to unbalanCe international
exchange and weaken the power of
Europeans to buy American products.
AS exchange gets Strengthened out
more payments will come into the
Treasury from abroad, but the public
can hardly expect the advances from
the allies to be of sufficient size dur
ing the next few years to alter the
American income tax rate.
The - next generation alone will
benefit from the allied payments,
though it is quite possible the Treas
ury will some day issue securities
based upon the British and allied
promises and that the American in
vestors will thus relieve the Treasury
of it's burden.
For the moment the American gov
ernment is almost a disinterested OBJ
server in the reparations negotia-
tions. The meeting in London of the
allies has failed to draw the United
States into the discussion officially.
The decision to give Germany more
time to consider an acceptance of the
allied proposition meets with approval
had a lingering hope that moral sua-
sion would influence Germany to ac-
cept and make physical coercion un-
necessary. While the allies are
formulating their proposition, the
government here is merely biding it's
time, hoping in some way to be of
help in solving the tangle, but with