The Washington herald., 1922-03-02
Germany Taxes France.

A FTER the armistice, France introduced French
~ money into lsace-Lorraine by exchanging
French franc notes for the mark notes held by the
inhabitants, giving I25 francs for each mark, that
being the relative value of the two denominations
before the war. According to the current, lament
able custom of European nations, it not difficult
for France to provide the money with which to
take up these German marks; the government
printing presses ran off the franc notes easily
enough Of course, if the German marks really
had the value with reference to the francs at which
the exchange was made, and if that value had been
maintained, the French government would have lost
nothing by the exchange. A disposal of the
quired marks in commercial way would, under
such circumstances, have netted France as many
francs were paid for the marks and those francs
could have been withdrawn from circulation, thus
preventing imitation account of the trade. But
this as we understand it, not done. Our infor-
nation is that the marks collected are still in stor-
age, no disposition having been made of them. OF
course, these marks, which were obligation of
the German government to the holders of them
the same any other paper money-have declined
greatly in value while they have been in storage
This has been due to the imitation of the currency
by the German government. The people of Alsace
Lorraine have not been the particular sufferers be-
they got francs in place of their marks. The
people of France as a whole have been taxed by
the German government to the extent of the differ
ence in value between the marks acquired at the time
| of acquisition and the value now. So, German cur
rency initiation has taxed France just it has taxed
Lithuania. Odd, that France and Lithuania should
be paying taxes, unwillingly, to Germany!
Something of this exchange of francs for marks
in Alsace-Lorraine is told in recent article in the
Financial News of London, written by the Paris
correspondent of that paper. This article reads in
! part as follows:
| IN. Bokanovski has presented report, on
behalf of the financial committee of the cham
Der, regarding the monetary reform of Alsace-
Lorraine. The exchange of mark notes into
franc notes that took place in these provinces
Immediately after the 'armstice the basis of
| the mint parity gave rise to a series of most
complex problems, of which are without
| precedent. 1t is true that in previous also
the monetary circulation of the annexed terri
tories was exchanged into the national currency
of the conqueror. However, the rapid develop
ment of financial economy during the last dec
adc has brought about the creation of such
complicated network Of financial relations as
| never existed during the previous European
wars. Today, any artificial interference with the
circulating media of modern country necessi-
tates the solution of number of difficult prob
lens. 1t would be mistake to believe that the
unifcation of Alsace-Lorraine currency with
that of France has been settled by the exchange
of I25 francs against mark.
"The act of April 23 1910, fixed the maxi
mum expense of the treasury in connection
with the withdrawal of mark notes at 22so-
100000 Up to the present the following
amounts have been spent:
Francs.
| Exchange of marks in Alsace
Lorraine .....: :;-...:.:....:. 1,253Is4ss7
Advances to Alsace-I Lorraine
banks :.....:..:.::.,..:.... 43r,663672
Transformation of Reichbank ac-
counts .............:. oS,855,o41
Exchange for prisoners and for
the inhabitants of the liberated
areas ACKNOWLEDGEMENTS. Ioo,I434S7
Total Observation-Disclosures. 1Ss3847,o57
However, there are number of other
claims for various indemnities for differences,
and it is hardly possible to satisfy them from
the remaining credit of 366I52,o42 francs Part
of the requirements will be granted in the form
of loans for the purpose of supporting those
banks which have got into difficulties on ac-
count of the terms of the unihcation The deficit
is estimated at 26o,oooooo and, in addition an
annual subsidy of 100000 will appear in fu-
ture budgets during series of years"
Thus, it appears that the acquisition of Alsacc-
Lorraine by France brought considerable cx-
pense and number of problems. AS explained
above, it seems that the expense has been increased
perhaps needlessly, by the retention by France of
| the German marks acquired when the exchange
was made.
Nv