New-York tribune., 1922-12-27
Opposition to
Kahn Debt Plan
Seen in Capital
Bankers German Birth
and British Naturallza'
iion Pointed To as Civ
ing Hint at Propaganda
Embarrassing, Says Frear
Members of Commission As
sert They Lack Power
to Take Steps Proposed
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Eroes Tha TftbuneN Ho4"fHvt'"
WASHINGTON. Dec. 2e.-The solu-
tIon Of Americas foreign debt problem
proposed By Otto II. Kahn, New YORK
banker, failed to strike a responsive
chord to-day in official circles here
Members of the American Debt
Funding Commission took note OF MI
Kahns proposal that the United States
di6erentiate between the $500 900 600
loaned TO European countries before
the armistiee, and the s2,5ooIooO'oOO
loaned after hostilitIes ceased, and ar
range differing methods Of repayment
but pointed out the act Of Congress
creating the commission would permit
no such differentiation even II con-
sidered advisable.
Members Of Congress generally eH-
pressed decided opposition to the
bankers suggestion that at least a
norton Of the debt be cancelled.
Several leaders In both the Senate and
House said the American people were
In no mood 10 approve such action
FreAr Attacks Kahn Plan
Mr.. Kahn's views, presented In a let
ter N Senator Smoot, Utah, OF the
Debt Funding Commission, drew par
ticular fire from Representative trear,
~ Wisconsin. a Republican member OF
the House Ways and Means Committee
who wrote Senator Smoot: THE COM
mission should apprise foreign govern
ments at an early day OF the anom-
alous position occupied by MT. kann
and that he does not speak Tor tne
commission, for Congress or for the
American people,
Senator snoot had not received Mr:
KAhn's letter to-day and said he would
not comment upon II until ne haa'
after studying the proportions u sets
forth. other members OF the commits
sion were quick 10 announce the com
mission could DO nothing toward oil.
/ ferentintion In tho debt as suggested
BY no banker.
They pointed out the commission
was permitted TO do only three things
with the debts-allow postponement OF
payment Of principal for not longer
/ than twenty-five years, fix the interest
rate at not less than AZ per cent and
authorize funding Of the interest
along with the principal, for not
/ longer than twenty-five years.
The most tho debt commission could
/ do In line With The Kahn suggestions
/ il was said. would be 10 present rec
/ concentrations 70 Congress II 10 wai
found impossible TO proceed within the
l latter's authorization.
Embarrassing Propaganda Seen
| Representative Prear's letter pointed
/ 20 Mr. Kahn's German birth, his sub
/ sequent British naturalization and bis
membership in the Kuhn, Loeb a Co
/ banking firm.
"The frequency Of his advice for can
collation. OF foreign debts. in whole oi
in part" II read, "and the publicity
attending his efforts 10 that end, sug
gest a propaganda tending 10 embar
I rAss the commission and 10 misleat
foreign governments as 70 tho senti'
ment In this country on the subject.
Possibly testimony before our com
mittee that over $4,000, ,000. 900 In for.
eign securities are held largely By in
/ ternational bankers, including Kuhn
Loeb 4 Co.. may be a factor In con
slant appeals for cancellation Of the
/ governments debt.
'No payment Of these foreign debts
/ 70 New York international bankers. ol
/ their customers. can be expected until
the governments prior len Of approx
mately $1,000. 100000 has been pro.
vided for. Mr. Kahn's foreign debt
private holdings are not proposed by
| him for cancellation, nor-does he sug.
gest that foreign governments should
relinquish their treaty land aequisi-
tons as an indueement for cancella'
tion Of their debts"