The New York herald., 1922-12-11
ALLIES FACING SPLIT
REJECT CUNO TERMS,
FRANCE WANTS RUHR
London Conference MayEnd
Over POincare's Demand
for GUARANTEES.
GERMANS NOTE VAGUE
Internal and External Flo
tati0ns With Moratorium
Based on Success.
MUSSOLINI OFFERS PLAN
Italian Only Optimist at Meet
ing and Holds He Can Save
the Situation.
Special Gable TO THE Npw Yorx HERALD

Special Gable 10 THE NEw YoHK HERALD
Copyright, 1929, by TIE NEW York HBRALp.
New York Herald Bureau.l
London. Dec. 10.
The possibility not only OF a break
down of the conference but OF a rup-
ture of the Entente stares the allied
Premiers in the face. The British
Cabinet will meet early tomorrow to
consider what action to take If Pre-
mier Poincare insists. as he did to-
day. that the French must occupy the
Ruhr as the basic guaranty for a
moratorium and for the carrying out
Of reparations obligations.
The entire situation was thoroughly
canvassed tonight. but Poincare re-
fused to trust Germany without such
securities" and this remained the rock
upon which the Premiers split. Both
Mussolini and Bonar Law put for
ward tentative plans. but neither
satisfied the French. Poincare char
acterized the German note, which was
Unexpectedly handed to the British
Foreign Office last night. as per
fidious" and furnishing ample reason
why not even a six months financial
respite, as Bonar Law proposed.
should be granted. He said that
France would not accept Chancellor
Cuno's proposals.
The outstanding force that is keep
ing the conference together Is the
| af hoIyx
New York HERALD correspondent is
able to state that distinct impress
sion pervades conference circles that
J if Premier Poincare and the Germans
can come within reasonable reach of
settlement--a real settlement that
will assure the peace of Europe-word
, may be expected from Washington.
German Proposals Rejected.
One report says that If they come
within a billion dollars of an agreement
on the reparations 'atal. and other
things being r.h.. President Harding
and Secretary Hughes may announce the
terms upon which America might bridge
the difference.
That the Allies reached unanimity on
one point was made known tonight by
Premier Mussolini. who said that the
conference had voted unanimously to
reject the terms which Germany offered
last night through the British Foreign
Office. These proposals included plans
for a German international loan. which
Voud be as large as possible. and would
bffer inducements TO Germans TO sub
scribe. Amnesty for those who have
violated the German laws by sending
capital abroad would be one offer
which would encourage the return or
this money. Should the loan amount TO
three billion marks gold. then two
years moratorium should be granted
and another year for every billion over
that figure. Half the proceeds OF such
loan would be retained by Germany
for the stabilization OF the mark and
the balance paid over to the Reparations
Commission. This loan would be exempt
from taxes An external loan would be
floated for three billion gold marks, ss-
cured by the German customs.
Unanimity is hardly the term to de-
scribe che manner In which the various
participants view the German proposal.
Even Polncnre rejoices that Germany
for the first time does not seek to cut
iown tho to.al amount Of reparatio
The British and Belgians, while recog-
nlzing that the German note In its pres-
ent form Is unsatisfactory, believe II
might provide useful basis for barr
gaining. While the note made adequate
provision for immediate cash, the French
argue that an international loan would
'ake the cash from the pockets OF tina
very persons they sought TO pay.
Cuno Pleads Poverty.
Dr. Cuno in his note declared the SAL
vation OF Europe hinged on the stabili-
zation OF the mark. He pledged HIM
self 10 do all In his power 10 meet ths
reparatlons debt. but called attention
10 Germanys poverty. His proposals
leave the final sum OF reparations in the
air. and the French object that. except
for the payments which Germany her.
self determines TO make from an exter-
nal loan. she might prolong the mora
torium indefinitely. Germanys good
faith stil remains the stumbling block.
poincnre insists that firm hand on
Germany's throat is the only way 10
secure payments
Mussollni waved eloquent tonight
over the plan which he submitted TO the
conferences. and there Is no doubt that
ne has submitted the only fully de-
veloped plan based upon scaling down
OF the reparations as the interallied
debts are scaled down. 4, IL said. how
ever that America n left out OF con-
sideration in the scaling down OF debts.
The italian Premier told TIE NEW York
HERALD CORRESPONDENT that after unani-
mously rejecting the German plan the
conference again turned 70 a considera-
ton of the Italian plan with Bonar
Law and Poincare making general OBJ
servatiors. These were the only two
plans before the Premiers to-day.
Mussolni SAYS the conference to-mo'
row will continue consideration OF
Italian plan While he refuses TO 81
russ the details ~ Is known 70 rcseiub)s.
closely the ro-cailed "Chsquers' plsn
which proved unsatisfactory TO th6M
French last year.
Asked whether t provided guarantees.
Mussolni said, Yes"
Are the guarantees economic or poll
tical2"
Economic" Mussollni snapped back