Perth Amboy evening news., 1921-02-02
WORLD MARKETS WILL TELL
IF GERMAN LEVY IS FAIR
Continued from page -

But by stripping Germany of her
shipping. by imposing a twelve and
one half per cent tax against the to-
tai of her exports. by requiring that
she deliver to France large quanti-
ties of coal, and by similar limita-
tons on her Industrial expansion,
the difficulties of making payment
are multiplied MANY fold.
"A capital sum of S3,580,000, 900
gold marks" said Baruch, turning
through memoranda brought him
by his sta~tisticians. "if placed on in
terest at 5 per cent. for AZ years.
would amount to 226, 900, 100000
marks. the amount of the cash in
demnity.
THAT amounts, in round figures to
21 billion dollars. Germany already
has paid about $500, 100000. That
makes total capital investment of a
little less than $25 900 600, O0O-or
approximately the amOunt OF bonds
issued by America for the war, in
Guiding the loans to the allies"
us there any dependable basis on
which to estimate the amount that
will be produced by the twelve and
one-half per cent. tax on exports?"
Baruch was asked.
NO dependable basis" he replied.
"Of course. IL her exports returned
to the pre-war normal, or there
abouts, it would mean perhaps a
billion and a quarter or a billion and
a half marks annually.
"This tax, of course, affords a nj
in protection against goods exported
from Germany. This becomes, how
ever, a tax on the American consum-
or of goods.
NnA--.alxr AAl1Aaf- IL krNf a. eroaS
into the treasury Of the allies, not
into the treasury of the United
States, as would a similar protective
tariff imposed by US against German
manufacturers. This tax will have
the effect of increasing prices and
~lessening exports.
THE wisdom of this action may
be open to criticism because of the
tendency it would have to lessen the
volume-of German business and to
make the amount Understandable.
Incidentally it might be pointed
out that America stands in a diff
ferent position from any of her as
sociates in the war under this export
tariff provision. The tariff must be
paid by America on German-made
goods purchased and the money
goes to the allies. England or
France, however. purchasing the
same goods. pays the tariff, of
course. but gets it back In the form
of ~reparations payments from Ger
many.
IF Germany accepts voluntarily
and proceeds in good faith. and II
she can carry out the obligations"
Baruch continued. there should be
a gradual sterilization of economic
conditions in all central Europe. This
would spread. after a time. evs to
Russia, which will mean a slow but
sure widening of the markets. and
after a while an improvement in the
condition of the unemployed.
"The fixing Of definite r~eparatiOns
will make it easier to form soine ade-
quate base to a system of taxation
and give a better Judgment as to any
tariffs that the party in power may
have in mind"
"Will it help Europe repay us u
war loans?"
81. will give the allied nations a
better understanding of their ability
to meet their Indebtedness to us.
The agreement. necessarily. is of vi
tai interest to US. both with respect
to our governmental finances and to
American business. But, of course,
America by failing to ratify the trea-
ty removed itself from any direct
participation in the settlement of
~reparations.
whether it is a wise settlement
or not, and what benefits and ad-
yantages may come from 1t will de-
pend upon the spirit in which 1t Is
entered into by all the parties to the
contract. and whether or not Ger
many a make the payments.
"If this Will end the war-and
each and every one will earnestly
strive to make il do so-much more
been gained"
Copyright. 1921. Newspaper Enter
prise Association.)