Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1922-10-04

from her foreign balances and the sale
Of foreign securities. Sucn n payment.
he asserted. would only he possible II
all other demands are postponed for a
definite period. long enough TO stabilize
the mark. Future demands at the OK.
piration Of that period. he said. must
be limited 10 the annual amount OF Ger.
many's eXportable surplus at that time.
The speaker. who is chairman OF the
London Joint city and Midland Bank,
Ltd. said TO be the largest bank in
Great Britain. gave his views on the
economic aspects Of rcparations and in
ternational debts. how they arc payable.
the general capacity Of a debtor coun I.
try to pay. and the effect OF payment.
''1f 7 have become convinced he
| said. that any attempt TO enforce pay
ment beyond the debtors ability IL in
furious TO the international trade Of the
whole world. lowers wages. reduces
! profits and is an indirect cause of un.
employment the conclusion is founded
! solely on economic grounds and Is nm :
influenced by any political considcra =
| tions or any regard TO the moral obli-
cations Of the debtors.
England Can Pay Debt
/ Willie he stated that he was not in
politics and did not appear in any
representative character. as q British
banker he argued that England has
the capacity to pay hcr debt to the
! nited States. and. he continued. II
! can unhesltatingly assert h"r ictermi-
4 nation to honor hcr hond in full " The
: remaining international debts. he stat.
cd. should he considered as ones in
which the United states and England
are equally concerned and in which
| both hav" the same interests as credi-
! tors.
The question to bc investigated in
connection with the German repara
! tions. he said, is not Gcrmany's ca
paci'y 70 produce wealth. but her ca
| pacitr 10 pay foreign debt. Tho Vcr-
sHi''rs experts who figured that Ger
many "ould pay 10 billions of dollars
" separations were in error on that
no'nl. he asserted
'Nobody has over doubted Ger
many'e immense power 10 produrc.' hc
continued. but production by Il sclf
Is NOT enough. She must find q mar
ket for her exports and the problem
thus becomes one Of determining the
possible extension Of German foreign
trade. We must remember that an
increase in her exports will only find
funds for reparations II there is no cor
responding increase in imports. Pay
mcnt Of her indispensable imports must
bo the frs, charge upon the proceeds
"f her foreign sales. and IL is only
tho balance. the cXportablc SURPLUS.
which Is available for rcparations.'
Germany has no present capacity to
obtain u surplus from the export Of
goods. he argued. While it has been
suggested that tho German Govern
m"nt could moo, it's liabilities IL her
people were adequately taxed. Mr.. Nc
: kcnu1 said hn failed to see how ad-
hi'ional taxation can increase foreign
Trade and rrovid" n large cxportablr
surplus. IN" taxes would bc paid IN
marks. he said. and whether the marks
arc derived from UvoWcd taxation or
from concealed taxation through thc
rsc Of th" printing press. they arc in
neither caS" a currency which would hc
accepted in discharge of foreign La
lility.
Mary Gcrmaus possess foreign as.
S"is, h" ~Id Thry have Investments
or balances in foreign banks. tho pro-
, Goods Of tho sales Of marks which have
been nurs on foreign markets when
N" mark dcprocia.cd in valuc under
prcSsur" Of th" r"parati"n payments.
''Eclirvc this pressure. he said.
'and tho mark would Immediately i'm.
prove. tn" mark has far greater
valrr in Germany than il has outside
and th" German holders Of foreign as
sets would have clear advantage In
selling them to their Government.
II believe il would b" safe TO put III"
total value Of thcsc assets az not less
,han u billion dollars. Whatever ths
amount may be. however. Gcrmnny
could pay it. provided tho fall IN til"
mark wss arrrstcd. Moro than that.
d" not think she has the ability 70 find
at any rate for some years. and il
would hr rondi'ion of This payment
that no moro should be demanded Of
her for a long time Ia come. The rred-
TORS would gain by abandoning tho al
tempt to obtain other money payments
for 4 period Of at least three ycars and
| am quite sure tho world aS whole
would ho an immense gamer in tho
general .tahili2ation Of exchanges which
would ensue upon an arrest nf the fall
in tho mark. But no solution of tho
reparntion problem is possible unless
political considerations are subordinalcd
10 economic facts.
Touching upon the French d"br ,"
the United States in which Grcat
Britain is also interested as n French
creditor. Nr. M"kenna stated thAf
Frances external debt is far too great
in relation 10 international trad" pos
sibilities. Viewing th" situation from
ia" standpoint, Of 1914 and peace tim"
cnnditionS. h" asserted that Il is rec
oRuiHablc that France has no trade sur
plus or reserves Of accumulated and
ryportablr wealth 10 enable her 10 meet
Ler prcsent external liabilities. The mere
cudcav"r Of France 70 extend her for
eign sales 10 the required degree would
disorganiHc the trade Of the world b."
ma iniAinc'.
"Thc inevitable conclusion is. he
continued, 'that these international
debts ar" far TOO great for tho capacity
Of any Of tho debtor countries cxcrpt
England. She al"n" in her accumli
lat"d foreign investments had adequate"
resources with which TO discharge her
liability {" the lni'cd States: "t the
others France has tho grnaicSt re.
sourccS, but they are. | believe. quite
insufficient 10 meet hcr obligations.
"Thc Whol" subject rcuuircs n ra.
i!"nhI reconsideration by the creditors.
VIII" must keep steadily in view Tho
immcdia'" cf"ct oF the payment of these
debts on the general trade Of the
world -