The Alaska daily empire., 1922-03-13
REFUNDING OUR LOANS TO FOREIGN
 GOVERNMENTS.

The problem of Eurcpes indebtedness to t nited States will be a live issue for many years ome the National Bank of Commerce in New Yo elieves. Because of the present worldwide bu ess depression the confusion ill international trat nd the financial difficulties of number of the T ions of Europe, refundng legislation does not set he large question of international obligations, t ank says in the March number of it's magazir ommerce Monthly. It adds:
 Foreign governments owe the United States approximately $11. .000, 900 900 largely payable demand. On February the President signed a bill creating a commis- sion to arrange the refunding of these obli- gations. The commission is specifically powered within three years to refund and extend the time of payment of the principal or the interest of any obligations of any foreign government arising out of the World War, now held or hereafter acquired by the United States The converted obligations may not have maturity beyond June IS, 1947, or an interest rate of less than 4A per cent. Authority to cancel any part of the indebtedness to substitute the obliga- tions of one country for another is speci- fcally withheld from the Commission by the terms of the act.
 It seems reasonable to predict that the Commission will extend as enient terms to our former allies in the matter of refund- ing these debts possible under the terms of the present legislation. In the
 
 opinons to the question of ultimate pay ment,-one for and. against the full cancellation of the debts
 The case for cancellation was well stated in a recent address by Justice Clarke of the United States Supreme Court. The arguments run that for three years the Allies fought the Central Powers without our assistance. Our advances went to further the common vic tory and were nothing less than our share in the war, so that in equity there really is nothing owing us.
 But assuming that the Allies can pay runs the argument-may it not be a ques- tion whether it is to best interest that they do so? It is not necessary to demon- strate that our debtors must meet both the yearly interest payments and amortzations chiefly by sending goods manufactured goods-nto this country. The annual in- terest alone foreign debts at A per cent. comes to a round half billion dollars. Our favorable trade balance of last year about g., 900 900, 000 If our Allies are able 10 meet their interest obligations. our trade balance will probably show rapid read jnstment during the next few years. The balance may shift to a so-called unfavorabe one, with imports exceeding exports conceiv- ably by as much half billion dollars. Such a sudden readjustment, such influx of manufactured goods from abroad, would possibly entail serious consequences, pro longing for long period unsatisfactory business relations If, however, our investors should purchase foreign securities on a large scale, readjusfment may be partially ar rested Such are the main points of this phase of the case
 One of the most forceful of the argu- ments of the procancellation forces is only incidentally moral or economic. They hold that if we press for the collection of these advances shall in the years to come gain ,the reputation of being the Shylock of in- ternationai finance. They point to history to demonstrate that the repayment of huge international debts. whether tribute bor- rowings. usually breeds spirit of mutual distrust, suspicion and ultimate hatred be- tween the parties involved And they raise the question whether for nation with