The New York herald., 1921-11-29
FAVORS using ALLIED
DEBT DUE US TO PUT
EUROPE ON HER FEET
f. A. Vanderlip Suggests
Way to Benefit Economic
Situation Of World.
WOULDAvERT PARADOX
Loans Not Cancelled, but
Called and Money Raised
to Restore Industries.
Rejects OTHER METHODS
This One Would Insure Ulti-
mate Payment Without In
jury to Any Parties.

Frank A. vanderlip, formerly presi-
dent Of the National City Bank, who
returned last week from an extensive
tour OF Europe, told the members OF
the Economic Club Of New York al
the Hotel Astor last night that the
time has come for the United States
to perform the, beuu-jeste-the grand
gesture-in international relationships
She should require an acl<nowledg
ment and demand payment of the
European allied debts, Mr.. vanderlip
said. ard then she should forego re-
ce.pt Of the money on condition that
every dollar that can be raised by the
debtor nations shall be expended FOR
their own economic rehabilitation
along lines to which this country must
give her approval.
BY this means, Mr.. Vanderlip be-
lieves. the United States and Europe
may be saved from the consequences
OF the economic paradox confronting
then-tlle fact that America Cannot
afford at this time to accept payment
of even the annual interest of $780,
100000 in goods, the only way II
which payments can now be made
without disastrous effect upon her
own industry. In the end. Mr.. Van
derlip declared, the United States
would be as much hurt by the rapid
receipt of payment in the form OF
goods as the debtors of this country
would be in making payment.
Rejects other Suggestions.
Mr. yanderlip began by a discussion o!
the various other methods for the settle
nent Of the allied debt that have beer
proposed, such, for instance, as the can
collation. Of Britain's debt on condition
she cancel those or the other belligerents
to her unconditional cancellation on the
ground that the loans were part of Amer
ica's contribution TO the war, or the ac-
cuisition by America Of new trade routes
in lieu Of payment He rejected all these.
I'VE should repulse with vigor," he
said, "any suggestion that these advances
were not actual loans. believe that We
should repel any theory that these loans
were contributions toward the enerly's
defeat and were only ostensible in a
form contemplating payment"
Continuing briefly on this phase Of the
subject, Mr.. Vanderlip pointed out that
Americas first great adventure in grant
ing international credits would have a
most unhappy conclusion IL it were to end
In complete reputation Of the debts by
the European nations. It would be In
in those circumstances, he
said, that American investors would
again 60 into their pockets to md funds
for future international loans.
Another suggestion, that America
should exact undertakings from her
debtor nations that would effect CONF
pliance with a general limitation of ar
mament plan in recognition of a. renis-
sion OF foreign debts, also had its OBJ
jectionablc features, Mr.. Vanderlip
thought II would be difficult, he said,
to agree to a cancellation OF Frances
debt to America while France lis of
her present mind. and continues to
maintain an army of from seven to
eight hundred thousand men,"
Would Not Ask Trade Rights.
Il should likewise reject az once,'
Mr.. vanderIip continued. ''the sugges-
ton that In exchange for cancellations
we ask to be given trade concessions
that We demand special commercial
privileges. The genesis of our foreign
policy has long been the open door.
equal rights fair field. II we should
through the cancellation of this indebt-
edness buy special privileges for our
commerce we should obtain discrimina-
tory treatment favorable 10 American
business, we should buy something which
we ought not TO have, something which
would in tho end plague us infinitely
more than it would ever prove to our
advantage.
"Thc paradox then persists. What
shall be done? To there some way In
which the integrity Of national promises
may be kept, some way by which our
future international relationships may
not be darkened by Reputation? Can
we while accomplishing these objects
avoid the consequences on the one hand
of running our debtors and the danger
on the other hand Of running ourselves
and a iensent creditor. In that respect
we should take the action of the Allies
in fixing the terms OF the German In
deninity as an example to be avoided
rather than followed.
THE crux OF my plan would lie. in the
disposition of the payments
IT would have America make a bcau-
jeste In international relationships.
while demanding that the payment be
made I would have her say that she Ia
prepared for the present to forgo II.
That is now the consequences of the
paradox may be avoided.
1T Is a commonplace 10 say that the
greatest opportunity to benent humanity
that ever came to any man lay At one
moment In he hands Of Woodrow Wilson.
The opportunity passed. Hopes were not
realised.
To-day the same opportunity lies at
the feet OF Americs. It's fate no longer
rests in the hands OF one individual !;
II is the responsibility of whole people.
Having In our hands the opportunity.
let US examine what II Is we might do"
Summarized, Mr.. vanderlp's plan is