The New York herald., 1922-09-14


economic adviser to the American
Commissioners at the Versailles peace
conference, has sent letter to Sena-
tor Borah of Idaho expressing the
opinion that the allied debts can be
paid in part, If not in full, provided
sufficient time is granted by this coun-
try.
Mr.. Baruch believes further that
Germany will be able substantially to
meet the reparations debt If she also
obtains sufficient time 1t is his opin-
ion that the allied debts and German
reparations cannot be treated sepa-
rately. He takes issue with the rea-
scning in the recent Balfour note sent
by England to the allied nations.
Text of the Letter.
Senator Borah placed the letter on
the Senate record to-day. This Is the
text of the letter:
September y, 1922
"MY DEAR SENATOR:
Pursuant TO our conversation of the
other Cay, as promised, I am putting
the financial aspects of the so-called
Balfour note.
That note is the presentation of the
opinion OF certain school in England
that contends that the German repara-
ton cannot be reduced unless all inter-
Allied indebtedness is cancelled or re-
ducsd, and that the inter-Allied in
dehtcdness should be Cancelled on the
ground that the war was a common
cause. and that each country gave what
II could in men and treasure.
The Balfour note listed among the
claims that England had and which It
would reduce or cancel If America can
celed the indebtedness of the Allies to
her. claim OF 81, 800. 900. 900 for German
reparation.
III the purpose of the note was to
secure Americas coming in on the
same basis as England. it might have
been well to have eliminated entirely
England's claims against Germany,
| which are based almost entirely upon
pensions and separation allowances, be-
cause America has put in no such claim.
Reason for American Decision.
The moving cause, as I understand
IT. for our not demanding a share of
the German reparation was in order to
permit the devastated countries-France.
Belgium. Italy and ,others-to have what
the Germans couldiRy.
SO far as the afiied debts are con-
cerned. there are several ways of look
ing at them.
There are those who say they should
be cancelled because they cannot be
paid. and there are those who. like Mr..
Balfour, say they should be Cancelled
because they weer incurred in a COM
mon cause.
The first Of these apparently con-
slider the matter from a purely COM
mercial standpoint What do the advo-
Gates OF cancellation mean when they
say that the Allies cannot pay? DO
they mean that these countries cannot
pay all or that they cannot pay a part?
Surely all OF the great countries who
are now our debtors can pay something
IL given time. And l am sure that coun-
tries like England, IL we insist. can and
will pay all. no matter what the cost
may be.
From a business standpoint 1t is GO
ing to be exceedingly difficult to con-
vince the American people, who after
all ara the final arbiters in this matter,
that - Germany can pay s10o00. .ooo. 600.
which all thoughtful people think she
can pay II given time and opportunity.
the Allies cannot pay the amounts due
us. Money is not the only method of
payment. II Is through the exchange OF
things that nations Will pay one an
other as most individuals pay one an
other But the nations of the world
cannot make things with which to pay
unless they get down to work.
Reply to BaIfour.
Now as to the Balfour point OF view !:
Whatever may be the opinions Of
others. including myself. on the subject
the American people, as n whole, de-
cided that the war was not theirs until
we entered tt and the international
community of interest and purpose must
be Viewed as dating from our entrance
into the war Then we must consider
what portion Of our advances was truly
for common objectlves.
THE records Of the Allied Purcha sing
Commission and the Treasury Depart
ment will show for what the various
sums OF money borrowed by England or
any other nation were spent. Whereas
1t might be convincingly contcnded that
the money spent for the purchase Of
munitions tbecause we had no. enough
soldiers ready TO use them. and because
England and the other Allies were able
TO use them to better advantage In the
quicker winning OF the war; would be
called a contribution TO a common cause
yet the same indecisIon could not be ar
rived at regarding certain other impor-
tant expenditures
Surely money that was spent for
things that went into the making OF
shipping. which became permanent
part OF the mercantile fleet OF England,
or money that was used for the purchas Sc
OF such matcria! as went for commercial.
purposes, or to bolster exchange Gin
most instances this was TO facilitate
purchases IN other countrcs) or to pay
for loans or materials obtained previ.
ously TO our entering the war tif there
were such) can by no conceivable rea.
son be considered a contribution to a
common cause and therefore, should not
be Cancelled.
Food for British Civilians.
The same applies In Instances where
food was bought for Euglnnd's civilian
/ population, not for her soldiers. and
was paid for by that population. IL
must be remembered that the English
/ Government did not give but sold to
its people the food bought in this
country.
"On the other hand. in practically
every instance where purchases were
4 L. ~.~f. t~.v. -.