New-York tribune., 1921-04-28
Cloudy,Evasive, ,
Says Baruch of
German Offer
Proposal to Free Property
Called Ridiculous and
Impossible Attempt to
Abrogate Parts Of Treaty
Plan to Pay IL Billion
u. S. Would Have to Enforce
Debt Payment; 4 P. C.
Interest Offer Too Low

Bernard M. Baruch, chief economic
adviser to the American delegation at
the peace conference, in discussing the
latest German reparstions proposals
yesterday, said that they were neither
CLEAR nor frank" and added that Ger
many was offering the Allies one-third
less than the latter demand.
He declared further that the eleventh
section of the German offer, which says
that the private property Of the Ger
mans abroad would also be freed, was
ridiculous and impossible attempt by
them to abrogate certain features Of
the Versailles treaty already put into
effect. Of this particular section of
the German proposal Mr.. Baruch said,
cts a fair sized niggar in the wood
pile"
Of the eighth section, which suggests
that Germany would be willing to take
over the Allied obligations to the Uni
ted States, Mr.. Baruch said: "The
United States cannot afford to be
placed in the position of accepting for
it's Allied obligations the bonds Of our
ton of having to enforce the terms of
the treaty-and quite alone"
Offer Is $4,000, 100000
Commenting on the first section of
the proposal, in which Germany says
it is willing to pay 50,000,000, 600 gold
marks, Mr.. Baruch said that, converted
into our currency, this amount IS about
$12, 900 100000.
He then contrasted this with me
proposal made by the Allies for "a
| gross sum of $54 100000, 900, the pay
ment of which was spread over forty
two years, which was equivalent tt q
present value of $21,000,000,0 900 at 5
per cent; $18,000,00 900 at per cent,
and $13,500, 100000 at per cent, which
is about the going market rates that
| foreign governments would have &c
| pay in this market.
"In other words" he said, "the Ger
mans are offering one-third less at
per cent than the Allies ask"
The international loan proposed in
the second section is, according to MIR.
Baruch, quite indefinite. He said that
the best the Germans could do would
be to float this loan at rate of per
cent and that Germany could not float
a large loan even at this rate.
"The German offer of $12,000,000,-
000," Mr.. Baruch said, proposes that
this sum should be raised by an inter
Allied loan, and that which cannot be
raised in this manner should be cared
for by security bearing but 4 per
cent interest. A German security
carrying but a per cent would sell at
a considerable discount and would not
represent capital value Of more than
perhaps $8,000000, ,000."
Calls Per Cent Ridiculous
Of the third section, which discusses
the per cent proposal specifically
he said: THE proposition of any pres
ent sum on the basis of per cent is
ridiculous in the extreme, because it
is impossible of realization. Germany
cannot expect to issue an obligation
at an interest rate of one-half Of what
the Allies themselves would have to
pay in gold in the markets of the
world"
Mr. Baruch said that the fourth sec
tion, which declares that Germany is
willing to permit the Allied powers to
share in an Improvement of her fnan-
clal and economic situation was dis
Srssed at the Peace Conference.
"Prcferred stocks" he said, "were to
have been issued by Germany and the
Allles given certain percentage Of
ownership in the great industries of
Germany, thereby giving to the Allies
continual interest in German enter
prise. This plan, however, did not meet
with approval at that time, but is, of
course, a matter for the Allies to de-
eide for themselves"
lie said that the next two sections
are matters Of course and that his in.
terpretatlon OF German payment in
KIND" was that where machinery OF
other things lad been destroyed or re.
moved, or where cattle had been stolen
they would be replaced
Discussing the eighth section more
fully, Mr.. Baruch said there was moth.
ing IN common between the German
obligations to the Allies and the Allied
obligations to the United States
1.-The American government" he said
"is not going to mix the two This
issue. The United States certainly is
not going to put herself in the position
of taking the German obligation il
place of the Allied obligations Ant
then if Germany is unwilling to meet
her obligations the United States woule
lose all or be forced to take militar,
measures. This is a highly unneces
sary ENHANCEMENT"
Criticizes Eleventh Section
But it was the eleventh section whicl
SoPSSioiAy dIuuocO tuc CTlClClSm OF M
Baruch. After saying that the Who'll
proposal to free German property is
ridiculous attempt to abrogate section
Of the treaty already in effect h
said:
This the Germans must know i
quite impossible. The United State
could neither propose this to the Allie
nor sanction it without placing itsel
in a position where the Congress O
the United States, which now has con
troll of this property, will be moral
obligated to return it to German citi
zens without due regard to the right
of American citizens under the treat,
"This last proposition shows eithe
dense ignorance on the part of tn
Germans or an expected stupidity o
the part of Americans or a direct cffo1
to deceive. Any one can Judge fo
himself. Germany must know that thi
would result in the abrogation OF
very large part of the treaty comprise
in the economic clauses"