The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1922-01-06

The projects differ from one an
other, and involve a mass Of techni-
cal detail. But we gather that they
all are for the purpose OF providing
credit for European business, restor-
Ing exchanges, reforming currencies,
stimulating industry and generally
bringing back prosperity in Euro
pean and American trade.
II any one OF the banks were placed
In Europe and were operated there
with American money. would It ac-
complish these purposes? The ques-
ton Is important, for II an interna-
uonal bank would not do these
things, We simply are wasting time
in considering it-time that might
better be devoted to practical meas
ures rather than high finances.
All technical details aside, 1t is diff
ficult to see how this much-adver-
tised plan would regulate any peo-
rle, government or industry.
AS for credit, the reason credit is
scarce in Russia. Germany, Austria.
Finland. Hungary and a dozen other
countries is that the things are
scarce on which credit is based.
Credit is not given on mere wind and
good wishes. 1t Is given, for instance,
on goods on hand or fair prospects
Of goods to come. The trouble with
continental Europe Is that II Is short
OF both. On the Continent the people
have not the wherewithal for credit
or for the purchase Of goods.
The British government has been
supporting credit schemes for foreign
trade since the fall Of 1919, yet at last
reports. Finland has used only
100000 worth Of credit; Poland only
100000 worth; Austria, only $525. 200
worth; Hungary, only $500 worth.
Why are the sums 30 small? Because
producers in these countries are not
turning out the goods, do not possess
the security on which credit can be
granted. How can a bank, a United
States bank, on the Continent, change
this any more than can the British
government right across the Channel?
1t Is difficult to see.
AS for reforming currencies and re-
storing exchanges, the plain cause Of
currency and exchange going to ruin
In most European countries Is the most
reckless government financing In the
worlds history. Almost at the same
time with the announcement OF pro-
jects for an American bank in Europe,
we learn that Germany's paper money
deficit this year will be enormous.
What. in such a deluge, could an
american bank do to restore ex
changes and money to anything like
rormal7 The effort would be like try
ing to turn back Niagara with a spoon.
As for stimulating industry and
production, what ails Europe's in.
dustry In the situation which already
has been set forth, and which an
American bank would be as powerless
es the British government to help
remedy unless the Europeans on the
Continent first undertook the task
themselves.
The project Of a great American
bank in Europe promises little in the
way of world regeneration and world
reconstruction. The weakness OF
such plans Is that they all fail to go
t. the root Of the matter. Most men
who propose them seem reluctant to
face the great bottom fact, or, facing
It, to make others face 1t. What Is
that fact? Simply that the govern.
ments and boundaries maintained
Under the Versailles treaty make
financial solvency and industrial pros
perity almost as difficult as political
r.eace.