The Washington times., 1922-04-16
EUROPEPAY|NC
BILLS IN PAPER,
ASSERTS OWEN
Declares Genoa Parley Not
Likely to Provide Cure for
Financial Ills.
EXCHANGE is DEMoRALlzEo
Federal Foreign Reserve Bank
Would Help Stabilize Mone-
.tary Conditions.
BY J. BART Campbell.
international News Service.

international Nrwn f'fNss"f
While the Genoa conference may
prove useful In partly adjusting
Europe's economic and financial
ills. IL is hardly likely to provide
permanent panacea for them
until the irresponsible and hap
hazard monetary and exchange
system prevalent in most Euro
pean countries is thoroughly over
hauled and re-established.
Europe Is Improving.
This is the opinion OF Senator
Robert l.. Owen OF Oklahoma, rank
ing Democratic member of the Sen
ate Banking and Currency Commit
tee, and its chairman during the
eight years OF the Wilson Admins
tration.
Senator Owen recently returned
from six weeks visit 10 Europe
for the purpose OF studying it's
financial, industrial, and commercial
conditions, and the possible applica-
tion OF them 20 Federal Reserve
banking system.
lie has pending in the Senate a
bin for the establishment OF Fed
eral Reserve foreign bank.
1T is true that Europe is steadily
improving" said Senator Owen,
but IL win take several years to get
Europe back to full production. The
dislocations' OF war have broken up
tens of thousands of small business
enterprises and have diminished the
purchasing power of millions of
people. Russia is at present almost
entirely out OF the market, and east
ern Europe generally Is greatly weak
ened In the ability to buy.
European industries were affect
ed by the boycott in India directed
by Gandhi; China is not buying
European goods to the extent that il
formerly did, but aside from these
and similar conditions the worst fea-
ture kof the European situation
which observed is the unwilling
ness and inability of many States to
restrict their expenditures-to cut
them down to their incomes.
And these States are payirg their
bills with paper money, which they
print In an irresponsible manner.
This paper Is usually regarded as
legal tender, as promises 10 pay In
gold, but without the possibility OF
redeeming II in gold.
Pound at q Discount"
Even the English pound sterling
In not yet redeemable in gold II is
at a discount of about so cents;
the French franc is also at a dis.
count, in terms OF gold, nr about
half; the German mark has gone
down to a seventy-fifth part Of its
normal value; the Austrian crown
to about a fifteen-hundredth part OF
it's gold value; the Polish mark Is in
q still worse shape, and the Russian
ruble has dropped TO a t.fty-thou-
santh part of It's gold value.
such terrible depreciations are
Incapable OF repair and leave the
people affected by them without an
adequate currency with which to
make their contracts. And until the
European nations correct this condi-
ton themselves and of their own
motion II win be extremely difficult
for America to render them the very
great service which America rs
naturally In a position to do"
Senator owen said that his bill
could be made OF gigantic value to
Europe II the European governments
and European banks would do their
parts" but that the United States
could not afford to participate in a
very great way in the restoration of
Europe unless the European nations
were willing 10 balance their budgets,
live within their incomes, provide
means for amortizing their debts and
receive with open arms the service
which America could render"
Growing jealousy Of U. s."
There appeared to me TO be in
some parts of Europe q growing
jealousy Of America" Senator Owen
continued. "In many Instances the
banks were not, like American com
= mercial banks, run on strict princi-
Dles OF banking. but were operated
a. trust companies in charge of in
Vulnerable commercial enterprises in
which commerce and banking were
intertwined.
They had, as a rule, no adequate
public system OF banking examina-
tons; the banking was very largely
treated, outside of the State banks.
as a private enterprise, and the
State banks had become instrument
talities for the putting out of depre-
ciated currency"
Senator Owen expressed his opin-
ion that while the Genoa conferences
would be useful" despite the limita-
tion OF It's agenda, 1t was bound to
be followed by more commemorative