Evening star., 1921-08-21
EUROPE'S DEBT is HARD PROBLEM
Difficult to See How Even Interest Payments Can Be Received
Without Involving Serious Disaster to Many Lines of
American Industry-Vews of Economists
and Financial Experts.

but a fair return of interest, accompanied over
a long term Of years Of progressive reductions
of principal, as opportunity Is favorable
I'VE have the same interest in the restora-
ton of Europe's producing power that coun-
try banker has in the prosperity of the farm
ing interest in his community. The problem
Is new only in its proportions-not In Its ma
ture 1 assume, therefore that the debt must
be funded over a long period. and the interest
paid through wealth production Of the debtor
nations nationally stimulated by American in
vestment and credit The debt will be paid not
in any one way, but through all the recognized
means by which nations. like individuals. satis-
fly the claims of a creditor who possesses
good investment
1T will require to an extraordinary degree
an enduring patience that can at times extend
even the period of interest payments. This is
often the practice Of a private creditor in the
protection of his loan. Through motives Of
enlightened selfshness. America can well afford
to adopt such 1epient measures will encour-
age and stimulate our debtor nations. The first
thing is to get Europe back to work. and that
is absolutely Indispensable. To this end. we
must within reasonable limits. aid with raw
materials, machinery and foodstuffs. But we
must not sacrifice our home market, for our
own economic security must be preserved II We
are to be of assistance to others.
1--WE face long, hard task Constructive ef-
fort is difficult. Wreckage Is easy. Our way is
not clear, for many contingencies will arise to
further complcate an intricate situation. The
fundamentals. however. are those which, under
like circumstances. would govern similar rela-
tions between individual men in everyday af-
fairs. We must adapt ourselves to circum-
stances they develop with clear under
standing that did not become creditors in an
ordinary commercial transaction. But these
vast debts were incurred in assuring the politi-
cal and economic salvation Of the world.
X X X X
Payment Of interest partly IN gold and part
ly in goods with the lapse of many years before
there are payments on account Of principal, is
the only way out which is seen by T. R. VIII
liams Of Pittsburgh. president of the American
Newspaper Publishers Association. He thinks
1t is up to the tariff makers in Congress to
devise ways in which goods payments may be
received without ruin to American industries
But members OF Congress are % anxiously
seeking light as are the fnanciers and econo-
mists. II wish kpaw thA best wax to receive
such pAyments, but don't" writes senator
Jones of Washington. chairman Of the Senate
committee on commerce. "As you say. 1t is one
Of the most vital problems that confront us
today. and shall be very interested in the
views as expressed by economic. financial and
commercial authorities to whom you are sub
mitting the question"
Representative Winslow Of Massachusetts,
chairman of the House committee on. Interstate
anu 1OTe1SH COIhIHSICe IL. eQuAIly 1EduA IN no.
mitting that he does not now see the way to a
solution Because don't know enough about
it to treat the subject specifically and thor
ouEhly," he writes. the most can say can be
summed up In a very few words, as follows:
In recognition of the confusion existing in the
world, believe the United States should be
farsighted and elastic In its treatment Of the
debts of foreign countries to our government
We should not only be just to ourselves. but
generous to our debtors. 4 can see no reason
at theA present time for Acanceling any of the
existing obligations"
X 4 \
william c. Reddeld. who was Secretary of
Commerce in the Wilson cabinet and is
president Of the American Manufacturers Ex-
port Association. takes less serious view Of
the problem than do others. He submits the
following:
while it is true that the debt. principal
and interest. possibly, cannot be paid in any
one Of the three ways suggested it seems clear
that it may be paid by a combination of the
three. the proportion Of each varying with the
changing circumstances and times.
Again there seems a fallacy in the state
ment Of the problem Our so-called favorable
balance before the war was the balance arising
from our total export trade to all countries
The principal and interest Of the debt is due
us from Europe alone. II distributed over all
three methods of payment. 1t need not be seri-
ous but II it were to seem SO we have it in
more largely to that vast portion of the world
which is not involved in the debt to us. If to
this end we had the wisdom to place American
Investments abroad, especially in the countries
needing development. we might control (as
Great Britain does) by reason Of those invest
ments an export trade. which would go far to
maintain the balance on the right side, while
at the same time securing in large measure
our own control of supplies which we must
necessarily purchase from other lands. It can
hardly be argued that having parted with our
wealth 1t must necessarily be Injurious to have
it paid back" =, Z ~
X X K k.S''-''''
An agricultural. view Of the problem is. pre-
sented by Sherman J. Lowell Of Fredonia, N Y,
master of. the National Grange. Mr. Lowell has
no doubt that the debt will be paid and thinks
the payments will take the form Of money and
goods. the, proportions and character Of goods to
be determined largely by the debtor nations But
he adds: Agricultural interests insist now and
win continue to insist that for every shipload Of
agricultural products which is brought here in
competition with tho American farmer, a ship
load of manufactured articles shall also be
brought here IN competition with the American
manufacturer. 1t is as useless to try to shut out
the one as the other, but it would be worse than
useless-it would be suicidal--to permit either
American agriculture or American industry to
be deliberately sbankrupted In order to sustain
the prosperity Of the other" 3 .. zs-l.5-s 81:
Mr. Lowell makes the further suggestion
that England might discharge her debt by turn
ing .someSof her West Indian islands over to the
United StateA .r 80. 49, .-..
{ 80 5at>{ ~ X asFs.
- Members Of the present cabinet and others
whose words might be construed as ofncisl
'utterances for that very reason are not in
position to give public voice to the views they :
have on this subject: but they are giving the
problem earnest study. and. while recognising