The Washington times., 1922-12-18

That II the cold Ik[
truth which en- "a
erges out of all
the heated Euro
pean loan talk
now inflaming -
the imagination '31
of Washington.
Internatio a WILLIAM HARD
bankers in New
York who would have to De -on'
suited before any great loan 70
Germany could be raised have not
vet been consulted at all. 1nforma-
ton reaching Washington from Ger.
tain of these gentlemen shows that
they are just as ignorant ana m
nocent of making any prospective
loan to Germany AZ any farmer IN
Iowa or Alabama. No such thing
exists as an organized plan among
American international bankers ~
a whole for any loan to Germany
Of any compettnt size whatsoever.
The fact n that the, necessary basis
for any such loan is at the present
time absolutely absent.
II would be well II the American
public and the European public
would realize that fact. ! herewith
present the views OF New York
banker whose firm
would have to take q considerable
part In any project for American
financing Of European recovery.
He tells me that his firm has not
been approached by the American
Government or by any European
government or by any group OF his
fellow bankers with any organized
plan for any loan to Germany ana
he adds certain illuminating obser-
vations which now quote.
THIS banker says: III q loan 10
Germany Ia to be successfully floated
among American investors, these IN
yestors must be sure that Germany
will not proceed to pay France and
England and then be unable to pay
them, notice that It is therefore
proposed that Germany shall agree
to nay the American investors first
and then pay France and England
afterwards. ~
But also notice that France
naturally objects to any such ar
rangement. She does not want the
United States to be Germany's pre-
ferred creditor. She wants to be
Germany's preferred creditor. How
could this conflict of interests be-
tween France and the United States
be harmonixed? There would be only
one practicable way.
"The payments from Germany to
France and the payments from Ger
many to the United States would
have to be handled and adjusted by
q joint governmental body on which
both France and the United States
would be represented.
"A governmental body for hand
ling the German payments TO
France and to the other European
allies exists now. II 10 the repara-
ton commission at Paris created by
the treaty Of Versailles. No other
body can lawfully perform the work
which that body II Performing II
is created by the treaty; and the
treaty ID the law Of the matter for
Germany and for the European. al
lies. Fe.
Therefore, n we Americans made
O loan to Germany and II we were
going to be assured that our money
would come back to us, and would
not get diverted to France and Bel.
gium and Italy and England, our
Government would have to Join the
reparati0n commission under the
treaty of Versailles or else at least
establish q firm official effective al
lance with the reparations commis-
sion.
"But our government has refused
to ratify the treaty Of Versailles.
It also today refuses to maintain
Americans In the reparation COM
mission a. observers with votes.
Our American reparations commits
sion observers are voteless OBJ
servers.
who 10 going to put any money
into an American loan to Germany
in such circumstancesf
These circumstances must be
changed before an American loan
to Germany on any large scale n
feasible. The payment Of repara-
tons by Germany TO France under
the treaty Of versaiIles ana the
payment Of interest by Germany TO
American investors on any large
American loan would have to be
handled by the same body. WIN
the United States 90 into such
bodyf"
| 4 = Z.
The answer to This bankers per.
.inent question IL that the United
States cannot do what he suggests
Unless the Senate OF the United
States consents to. Il, and the Sen
ate Of the United States at this
lime 10 not consenting. The tasl<
Of bringing Il TO the point Of con.
senting would be Z long task. Sen.
ators like johnson and Borah and
La Follette and Reed are irrecon.
cilably opposed to any American
partnership with any Of the inter
national governnentAl< <bodies set up
BY the treaty Of Versailles. The
task Of overcoming their opposltion
would be . long task It = time
when the Senate n engaged also IN
considering ship subsidy and rural
credits and many other critical and
controversial domestic American
issues.
Therefore the project OF . colos
sal loan to Germany II today
splendid theme for 3 dream, but moi
much Of subject for anybody who
II A. 7