The Birmingham age-herald., 1922-12-27
l KAHN PLAN MEETS. LITTLE FAVOR IN.
 OFFICIAL CIRCLES
Debt Commission Said to Have No Power to Cancel Partially Europe's
 Obligations
By Associated rrey

WASHINGTON, Dec. 2G.-The soiu- ton of Amerlea's foreign deh: prob lem proposed by otto II. Kahn, the New York banker, failed to strike a responsive chord today in official circles here.
 Members of the American debt funding comm sslon took note of Mir. Kahns proposal that the United States differentiate between the sev- en and half billion dollars loaned to European countries before the armistiee and the two and a half billions arranged afterwards and ar range different methods of payment pointed out the act of Congress cre- atIng the debt commi ssion would permit no such differentiation. even if considered advisable.
 Members of Congress expressed de- c dei opposition to the New York bankers suggestion that at least a portion of the debt bN cancelled. several leaders declaring that the American people would not approve such action.
 Frear Opposes PInn
 The views of MT. Kahn. as present. ed in a letter to Senator Shoot Utah, member of the debt funding com mission, drew particular fire from Representative Frear of Wisconsin, who addressed letter to Senator Shoot asserting that the commission should apprise foreign governments at an early day of the anomalous position occupied by Mir. Kahn and that he does not speak for the com mission, for the Congress. or for the American people
 Senator Smith had not received Mr. Kahn's letter today and said that he would not comment on it until he had studied the letter. Others, how ever, declared that the commission could do nothing toward the differ entiation. Only three things could be done, allow pGstponemcnt of pay ment for not longer than 25 years; to fix the rate of interest at not less than 41t per cent and to authorize funding of the interest along with the principal for not longer than 25 years.
 The most that the debt ct mmis- sion codld do in line with the Kahn suggestions, it was said. would be present recommendations to Congress that 1t was impossible to proceed within the authorization of Congress.
 Embnrrass Government
 Representative Frcar pointed to Mir. Kahn's German birth his sub sequent British naturalization, and to his membership in Kuhn, Loeb and banking firm and said the frequency of his advice for cancella- ton of foreign debts in whole or in part and the publicity attending his efforts to that end, suggest tending to embarrass the and to mislead foreign as to the sentiment in this country on the subject.
 Positive testimony before our the House ways and means committed that over s4,000,- 900 in foreign securities are held largely by International bankers. in- c1uding Kuhn, Loeb and Company" Mir. Frear continued. may be fac tor in constant appeals for cancella- ton of the governments debt No payment of these foreign debts to New York international bankers or their customers can be expected until the governments prior lien of ap- 11,0oo. 100000 has been provided for"
 Mr. Kahn's debt holdings are not proposed by him for cancellatit n, nor does he suggest that foreign govern ments should relinquish their treaty land acquisitions as an inducement for cancellation of their debts"