The daily times., 1922-03-07
URGES EUROPE To
BE ECONOMICAL. IN
PRESENT REVERSES
America Considers Herself the
Reservoir of Surplus Capital
and She Must Remain Strong
and Conserve Yet Capital
That it be Not Wasted on
Extravaxant Nations.

(By David Lawrence)
Copyright 1922 by The Daily
Times.)
Washington, March 6-The Uni
ted States government is taking steps
to prevent American money from be-
ing used wastefully in Europe and to
compel foreign peoples who seek
loans here to promise to use capital
for reproductive purposes only.
The full significance of what the
American government insists is not
political but an economic defen-
sive measure is just becoming ap-
parent With the failure of European
countries to balance their budgets
because they are spending too much
money for the maintenance of armies,
there has developed tendency on the
part of municipalities as we'll as cen
trail governments abroad to finance
themselves loosely on the expectation
that they can always make up their
deficits by borrowing through Amer
ican banking concerns.
This process however will be
abruptly halted by the United States
government through the use of its
moral influence and it's power of pub
licity The views of the Administra-
tion are summed up by Herbert
Hoover as follows:
America is today the remaining
great reservoir of surplus capital, and
we must remain strong and conserve
the rightful use of this capital if the
world is to recover. We will need
much of it for the upbuilding of ou1
homes and our public utilities, stag
mated today through the qualities in
readjustment between industries. But
our surplus even then is greater than
our needs, and it would be disaster il
! it were dissipated in wasteful expen
ditures abroad.
| Cali loans to foreign nations which
are not employed in reproductive
work are a destruction of the capital
1t is vital that our bankers and in
vestors should scrutinize the loans
to which they are asked to subscribe
that they may make sure that the!
are to be employed for reproductive
purposes or the refunding of out
standing obligations. The furnishing
Iof raw materials, the construction O
transportation facilities, public util
lities, factories and work throughon
the world, is use for American cap
ital that blesses both the borrowe
and the lender. The upbuilding of th'
trest of the world and it's consumin,
power adds primarily to world well
being, but it also adds to the deman,
for our own labor, the products o
our own farmers, and the services o
our own merchants.
But loans that are dissipated il
military expenditure or in unbalance'
budgets in the bolstering up of inflat
ed currencies, are double loss to tn
world. They are not only loss il
that they add nothing to the increas
cd productivity TO Tue COuSumlu
power of the world but they are
loss in that they entail the postpone
ment of those measures which ar
vital for the economic rehabilitatio
!, of the world"
This viewpoint on which Presiden
Harding and his Cabinet are in unaI
imous agreement is in reality seque
Ito the, failure of the Washington arm
conference to do anything on Ian
armament. 1t is protested that th
move is made in defense of America
ECONOMIC situation That is true bt
el the whole economic problem in E,
k rope is SO interrelated to the questio
n of expenditures for large standing a
e mics that the United States is takin
t. its own protective measures and pr
J. -lcautions so that American money wi
: tnot assist Initiation but will tend to r
J, uce fits scope.
Continued on page 9