The New York herald., 1922-10-05
McKenna on the War Debts.

McKenna on the War Debts.
Various bankers addressing the
other members of their convention
in this city have generally laid stress
on the help America must give to put
the ruined and distracted countries
of Europe on their feet. They have
been of single mind that one form
in which this help must be given is
that of liberal trade credits. They
have not been so unanimous about
the other form in which help is re-
Quired, the forgiveness Of interna-
tional war debts. although THOMAS
w. LAMONT has not been the only
American banker to suggest to his
fellows that readjustment of all the
war debts must be part Of the pro-
gram of necessary international CO.
operation.
The Right Honorable REGINALD
McKENNA, formerly Chancellor of the
British Exchequer, now chairman OF
the great London Joint City and Mid
land Bank system. is in the fortu-
nate position of representing at the
convention country which can pay
and when called upon. Mr. McKENNA
avows, stands ready to pay its war
debts to the United States Govern
ment. But he declares without hesi-
tation that the others are in no such
position as Great Britain, either as
to resources with which to pay or as
, to the number of debt balances to be
met. for Great Britain owes no coun-
try except the United States, while
Great Britain is owed not only by the
allied Powers with whom she stood
in the war but by other countries
the world over.
AS for Germany. he says that
she cannot now or soon pay even
small fraction of the repara-
tions debt assessed upon her. Fur
thermore, he declares, if Germany
could pay any considerable part OF
that colossal reparations debt the
countries OF Europe to which 1t is
owed could not benefit from such
payment. On the contrary, they could
only suffer. With no gold, with no
foreign investments to speak Of. with
no net foreign revenue from inter-
national trade, Germany could pay,
if at all. only with food of exports
that would submerge the allied coun-
tries and perhaps the world.
France could not permit such a
thing as that because of her own
manufacturers and workers. Great
Britain could not permit 1t for the
same reason. Italy could not. No
country could.
But Mr.. MCkENNA goes further
than that. France. in his Judgment,
could not pay her war debt to Great
Britain in the near future without
similar damage and destruction to
British industries. She could not pay
the United States without causing
economic disturbance and industrial
havoc here.
And what is true of one war debtor
nation under such circumstances is
true to a greater or a lesser degree
of all the war debtor nations. No
man who values his life wants to
play game at which he has to die
/ to win. No country whose prosperity
depends upon the safety of its indus
trial life wants to collect debt
the paying of which will kill its
industries.
And so the former Chancellor OF
the British Exchequer puts the great
world problem up to the bankers OF
America with this view, which he
believes should govern their attitude
in helping so far as they can in
forming sound public opinion upon
the financial and commercial aspects
of these international debts:
'Tf 7 have become convinced that
an attempt W eiioiS' P"' '''"N ~
] yond the debtors ability is injurious
TO the industrial trade OF the whole
! world. lowers wages. reduces profits
and is a direct cause of unemploy-
ment. the conclusion is founded solely
on economic grounds and Is uninflu-
enced by any political considerations
or any regard to the moral obliga-
tions OF the debtors"
And although he could not speak
the last word on this stupendous
question, although no one man could,
the world of bankers, the world OF
manufacturers and merchants. the
world Of statesmen and publicists
cannot fail to ponder carefully the
opinion OF the outstanding ipterna-
tional banker and the distinguished
financial guide Of an empire on what
lies ahead OF the family of nations
| in this matter Of war debts. colossal
and unpayable, that weigh upon all
Europe.
An Armistice at the Straits.
The Turkish Nationalists' accept