The New York herald., 1922-12-08
Continued from First Page.

its payment. to be redeemed by 1 per
cent. sinking fund.
The next step Is to obtain the willing
promise Of Germany to pay an annuity
of not more than f100, 100000. for with
out such willing promise it Will still be
impossible to create the necessary credit
In the anticipation Of its receipt Neither
bankers nor investors will be prepared
to grant any. credit based upon the Sc
curity of unwilling payments. Such
annual sums. If willingly paid. would
under the proper guarantees enable suf-
ficient credit to be raised as were
necessary to repair the entire physical
damage of the war and restore Europe's
productive power, and with it Europe's
buying power.
Having agreed upon practicable
sum Of reparatior. and having obtained
Germany's willing promise, the payment
OF interallied debts can be solved Pro-
vided that France and Italy consent to
reduce reparation payments to a reason
able sum, the British Government should
offer to cancel the debts of France and
Italy to Great Britain. This step
would at once substantially improve the
finances Of these countries and help
strengthen their credit.
This should be done by Great Britain
even IL America is not prepared to take
similar step. But these measures will
of themselves not solve the problem OF
European reconstruction. nor restore
the productive and buying power of the
| continental nations upon which the res
toraeion or world prosperity 80 greatly
depends. Additional steps are essential
| other Countries Must BE Restored.
The creation Of credit by means OF
which the restoration of France can be
completed within n short period will be
of almost no value unless it is acconns'
panied by the restoration OF the other
devastated districts Of Europe. and more
especially Russia and Poland. More
over, the injury which France sustained
from the war will not be healed until
tho investments Of France in other
countries of Europe. especially Russia,
are rendered OF value. For this to be
done. the nations In which French in
vestments have been made must be
restored to normal degree of pros
perity. Such restoration demands the
creation of a large amount Of credit.
| which these countries at present can
not possibly obtain.
| The problem of reparations indeed is
not merely French problem it is q
European problem. Moreover, the
restoration OF the whole OF Europe is
essential to an avoidance OF world in
solvency and the recovery of world
| pruepaity. Fortunately, there is n
method by which this work can be ac-
complshed.
Great Britain il entitled TO % per
! cent. OF German ,reparations payments
and this proportion of credits raised on
the security OF German reparation
1 ha al l.xt lrst II,
| possible. 90 create credit on an interest
basis of 4 per cent. and a sinking fund
| OF 1 per cent. Thus the payment OF a
sum of rl00. 900, 900 yearly by Germany
| would enable total credit of f2,000,-
0p0, 900 TO be raised. or this sum Great
| Britain would be entitled to f440, 900, 900
"A sum sufficient to restore Russia, Po-
land. Rumania and other countries, and
| place their currencies upon gold basis.
The advantage TO France of such action
would be great.
| France has invested about fl .o00,-
| 900, 900 In the rest OF Europe. sum
| which at present is practically valueless
Were. however. these debtor nations re-
| stored by the suggested credits, these
| French Investments would again become
| of value. Consequently II would be Of
| greater value to France for a portion or
| reparation credit 60 be aliocated TO these
countries than for the British portion OF
| reparstion to be relinquished IN favor OF
| France. In one case France would re-
ceive about f4O0.oOO.OoO and her for
eign investments would remain value
less and the trade of Europe depressed ;
while In the other case her foreign in
vestinents amounting to about ~ ,eoo,-
| 600. 900 would be rendered good and the
prosperity and trade of Europe would be
| restored.