The New York herald., 1921-01-26
Supreme Council i'm Paris
Flatly Rejects Proposal
for Quarter Billion Is
sue to Rescue State.
PRIVATE BANKERS SHY
Critical Financial Position
of Powers Shown When
Britain Admits She Has
No Loanable Funds.
VIENNA LOSES ALL HOPE
Labor Unions Want Annexa-
ton to Germany While
the Communists Plan
Soviet.
VIENNA LOSES ALL HOPE
by LAURENCE HILLS.


Special Gable to TIE New York HERALD.
Copyright, 1921, By THE New York HERALD.
New York Herald Bureau.
Paris, Jan. %5.
Grave fears arc entertained here to-
night that serious political and social
catastrophe is impending in Austria
which might easily spill over into ad-
joining countries.
The gravity of the Austrian situa-
off with greatest difficulty since last
Friday, the day following the expira-
ton of the ultimatum by technical
trades in which they threatened force
unless internal reforms were effected,
was accentuated to-day when the
Allied Supreme Council fatty rejected
the proposal for an allied loan of a
quarter of a billion dollars, payable in
ten yearly :nstalments Of $25,000,0O0
each and guaranteed by pledges on
Austria's resources.
The Premiers held that it was en-
tirely out of the question for the Allies
10 undertake TO make such loan in
the present state of their finances.
The proposal that such loan should
be made to Austria was by Sir William
Goode, president of the Austrian sec
ton Of the Preparations Commission,
and upon such a loan being made AUS
trias last hopes hung, reports from
Vienna being that Chancellor Mayr's
,;,-S,, oil 1,a inc nm,
that end of the telephone line, hoping
TO announce that the loan would be
made and thereby avert revolution.
Germany or Sovietism.
"IJnless the next twenty-four or
forty-eight hours brings salvation, Aus
tria Is lost" II was said at the Austrian
Embassy here this afternoon. Officials
there added that the Austrian revolution
had only been postponed while waiting
on the Paris conference OF the allied
Premers.
Dispatches received here from Vienna
Indicate that the labor unions there
want to put the Allies face to face
with a fait accompli by immediate an
nexation. through forcible measures. TO
Germany. Meanwhile the Austrian
Communists are making plans to pro-
claim Soviet republic.
French officials tonight see Austrian
annexation by Germans probable re-
suit of a revolution, but coming at
time when the disarmament Of Germany
S,ill is unenforced they believe such
annexation will only serve 10 increase
lrif af in which
event allied military Intervention. at
least for the purpose of control of the
Austro- German frontier. must be en-
crted to prevent westward spread OF
The revolutionary confiagration which
Germany has been predicting for the
last twelve months.
Private Loan Unlikely.
The only hope for Austria now seems
10 lie with private bankers IL allied
eys.tries coming forward to her aid but
Il Is feared here that even III this were
possible the help would come too iaIe.
Moreover. private bankers, especially IN
France and Italy. have their hands full
trying TO avert financial disaster in their
own countries.
The financial position of the Entente
Powers individually, in 80 far as aid to
another country is concerned, was never
better illustrated than by the attitude
shown toward the Austrian loan pro-
posal by the Reparations Commission
to-day. when Great Britain was forced
10 admit she had not dollar TO lend
and that only with the greatest difficulty
was she meeting her own interior needs.
The British delegates called attention
TO tho difficulty encountered In London
In connection with the f10, 0,000.000 loan
just raised and to the fact that Govern
mcnt loans to Austria would mean in
creased taxation, which the British peo-
pie would not stand.
Sir Robert Horne. president Of the
British Board OF Trade Louis Louche~.
French Minister for the Liberated
Regions, and Signor Giannini. a we'll
known Italian economist, who were
named by the Premiers to study the
Austrian situation. began studying a
private loan plan this afternoon, but
this portends more delay.
During the discussion the general
opinion was developed that it was use
less to try to do anything for Austria
apart from the solution OF the economic
problems OF the neighboring countries,
with which Austrla's future is bound to
he closely connected. The tendency is,
II appears. to reject any proposition
likely TO Involve increased taxation for
France and Great Britain. The Italian
viewpoint Is that Austria should not be
allowed TO bind herself to any particu-
lsr country or group OF countries
through international arrangements.