Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1922-10-10

| "A
| ~ the week was the address of Reginald
McKenna, the British statesman Of
finance, at the meeting of the Ameri-
can Bankers Association, in which he declar-
/ ed that England can and will discharge her
debt to this country, but that Germany is not
| able to pay; nor are Franc Italy. While
| these views have been advanced before and
while it known prior to Mr.. NICK enna's
| pronouncement, that England was preparing
| to make a payment on her account with the
| United States, at the same time his analysis
| of the international situation is uncommonly
| interesting-the clearest and most far-reach-
ing, financial authorities say, yet presented.
The problem of European war debts Is re-
garded not infrequently in distorting light
of prejudice or of sentiment; or, what Is lit
tie better, is treated as If it were in the un-
clouded realm of abstract justice rather than
| in troublous, changeful world of concrete
realities. If the question were simply what
OUGHT the debtors to pay, there would be
few If any perplexities; and few, moreover,
If 1t were simply a matter Of canceling the
debts of traditional friends and collecting
those of erstwhile foes. But the question
really is, what CAN these debtors pay, and
what effect will collecting from them have
upon international trade and finance and
hence upon the prosperity Of all countries
concerned?
"only to the extent of their foreign assets
and their exportable surplus of goods and
services" owe quote from the New York
Evening Posts summary of his address.) If
France could pay in 1871, it is sometimes
asked, why cannot Germany pay now? For
these reasons: France faced indemnity de-
mands which she could meet, because she
had extensive holdings Of foreign securities,
because she was able to obtain foreign sub
scriptions to her domestic loans, and because
o1,o oh1 a&ip ,1ofo 0f hnr
goods" Curiously enough, moreover, France
was then relatively prosperous notwithstand-
ing defeat, while Prussia, or the new Ger
man empire, was relatively depressed. But
Germany today faces Indemnity accounts to-
falling thirty-two billion dollars, sum which,
portable surplus could in no wise have COW
cred even before the war. How, then, can
they cover it now, after her resources OF that
nature have dwindled and disappeared? The
conclusion is that sic can pay only to the
extent of the balances which her citizens hold
abroad, and these sums can be made avail
able only by sucn revision Of the repara-
ton as will convince the owners that Ger
many has chance TO survive" Thus In his
judgment, maybe billion dollars can be OBJ
tanned. For the rest, there must be mora
torium of at least three years to allow for
sterilization of the mark, after which yearly
payments should be limited to an amount
equal to the country's exportable surplus"
Inc Case ol FRANCE anu 1IdAy, Willis Mu0n
less complex and grave (indeed, France has
recently given the United States assurances
regarding her own debt to this country, lust
be squared with economic necessities and with
common sense if the worlds great general
interests, on which all particular national
interests depend, are to be subserved.
The question of Americas cancellng her
European debts is thus distinctly simplified.
England does not ask cancellation, and the
others ultimately will pay as far as they can
Nor would there be an. virtue in writing off
the debts of nation that took advantage of
this release to build bigger war machines
and to press for selfish ambitions On the
other hand, there assuredly would be no
virtue and no wisdom. in essaying to en-
force claims where and when, in the very
nature of things, they cannot now be col
lected