New-York tribune., 1921-12-18
Mar Debt Bill
Snal.l To Be Put
|TJp to President
Senators Find II Difficult to
Agree With Mellon With
Regard TO Fixing Inter-
walls for Interest Payments
Measure Is ln,perilcd
S;tuation Revivcs Runor OF
Cabinet Change, Weeks
Taking Treasury Portfolio

From The 7fS6astcS NuSnsNQto3a 6sTccn
WASHINGTON, Dee. II. - Senate
r;nancc Committee leaders will carry
,Ae;, difficulties over the foreign debt
rnndins bill to President Harding in
IN effort to get them Strengthened out.
these difficulties have become serious,
.na as q result the question Of when
me foreign debt bill will be passed has
beeome one Of great uncertainty. In
fact. the passage of the bill at all is
believed in some quarters to be en-
ssnrcred. Secretary OF the Treasury
Mellon objects to the bill in the form
i which the committee has it.. 1t is
sxpccted President Harding will stand
~ the Secretary.
For some time there has been talk
in Washington that Secretary Mellon
would retire from the Cabinet and
would be replaced by Secretary of War
Weeks. The complications over the
foreign debt bill do not relate to this
matter directly. At the same time, the
persistence OF rumors Of the retirement
Of Mr.. Mellon has not served to
strengthen his hold on Congress, and,
on the other hand, the obstacles the
the foreign debt bill fashioned in the
form he wants it are not calculated to
add to his liking for public Office.
The eruS of the trouble over the for
eign debt bill relates to the question
whether the law should require that
the interest on the foreign debt be paid
semi-annually or at other stated inter
walls. As the bill stands now in the
committee it provides the interest
shall be paid semi-annually. On the
ground that some of the countries to
which this country made loans cannot
pay interest for a year or two, and
perhaps not for ten years, Secretary
Mellon does not want the law to pro-
ride for semi-annual payments. His
view is that this government should
require the foreign governments to
fund their indebtedness into bonds
which contain the customary provisions
Of securities respecting interest pay
ments and that if any country is un-
able to pay the interest from time to
time the situation thus arising be met
by such concessions as seem practi-
cable.
The bill is one Of the measures on
which the President has urged Con-
sress te act promptly. But by reason
Committee leaders to-day definitely de-
cided to make no attempt to adopt it
until January. The delay is pleasing
to Senator Lodge. not because he is
opposed to the legislation, but because
he, has been hoping the foreign debt
question would be suppressed until
after the conference. Indications now
are that the conference will be ended
before the bill can be taken up in the
Senate.
r The foreign debt funding bill from
the first has encountered opposition in
Congress. Recently the Finance Com
riitsce of the Senate took the bill up
second time, provided for commission
as does the House bill, and agreed on
other amendments.
Mellon Seeks Free Hand
These amendments provided the for
eign debts should not be extended be-
yond 1947, which is the date when vir--
tually all this country's wartime bond
issues expire; provided for semi-an-
nual interest payments; provided that
no part of the principal should be can
celed and that the interest should not
be remitted, and also prevented ex-
change of the bonds Of one country for
other bonds.
Senator McCumber was about to re-
port the bill as amended when, Secre-
tary Mellon objected and once more
appeared before the committee to voice
his objections.
"They cannot pay interest" the Sec
retary told the committee, "for one
year or two or three or ten years in
some cases."
Secretary Mellon wanted to be left
free to grant foreign governments the
right to postpone interest payments.
Senator Simmons, ranking Democrat on
the Finance Committee, strongly OBJ
jected to allowing him this power. He
told Mr.. Mellon and the committee that
this was unbusinesslike and that he
found no sentiment in this country for
remission of the debt or the interest.
Senator Simmons told Secretary Mel
lon, it is understood, that there was
propaganda for cancellation of the
debt, and that this would stop the
minute Congress took action which re-
quired funding on businesslike terms.
One of the possibilities is that fund
ing will be left to settlement under
the terms of the bond acts. Secretary
Mellon is understood to prefer in some
respects that this be done rather than
have his hands tied by the terms Of
the proposed funding legislation.