The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1923-03-27
SR|SE
BIC HELP To
ENGLAND
Lord Decies Says U. S. Tariff
Is Chief Barrier to
Normal Trade.
By LORD DECIEs,

English Financial Authority.
Written for international Nevs Service.
The pound sterling at par is equal
i to $4.S725.
LONDON, March 27.-The steady
recovery Of the pound sterling to-
wards par is one Of the romances Of
financial history. Slowly but stead.
lily 1t has crept up in value from
1.-THE dark days of 1920, when 1t stood
at 1913, to the present time, when
1t is worth about $40. Through
out that period the pound has been
a barometer of Britain's national
prosperity. When 1t reaches par
we can confidently expect better
days to come.
Look at only one Of the striking
consequences Of the rise to normal.
We shall pay nearly q million
pounds less each year on our debt
to the United States. Under the
terms Of the recent agreement the
annual charge which we have to
meet must be paid in dollars. Cal
culated at par, this amount is 3d.
000, 900 pounds. Calculated with the
exchange at a little over 10 shil-
lingS, as has been the case up to
the present, 1t is almost 81, 600, 900.
Apart from the comparatively
narrow question OF the debt, we
shall not be over-sanguine If we
look forward to q fall Of the cost
Of living in Britain. England Is a
great importing country, and from
the United States she imports three
main commodities on which her life
depends-wheat, cotton and copper.
The result Of the return to the nor
NAL exchange viii mean that these
commodities will cost the consumer
less.
Calls Tariff Barrier"
But before the full effect Of the
rise in the pound can be felt bar
rier which America herself has set
up will have to be removed. The
barrier is the tariff. All trade is a
question Of exchange. II we i'm
port goods from the United States,
| 1t is a fundamental axiom that in
some way or another we must pay
for them in goods. The normal
method Of payment Is by sending
our own goods in return. Trade Is
only a question of barter, however
complicated the transaction may be-
icome through the march Of civil.
zation..
But America apparently does not
want our goods. She has set up a
tariff on practically every commod-
| iy Of importance which we export,
with the result that she must be
| regarded as a wealthy customer who
| Is dead.
Since, therefore, we are debarred
from paying for our cheaper i'm.
ports in goods, we must pay in
gold. That is the last thing Amer
lea desires, since she already pos
sesses considerably more than one
half OF the gold that the world con-
tains. We are, therefore, in a dead
lock.
Must Remove Deadlock.
But 1t is a deadlock which I con-
fIdently believe the natural force
of economic law will remove. AL
ready America is seeing that by
refusing our exports she is curtail-
| ing her own exports. And she is
realizing that If she will not forego
her debt she will have to forego
her tariff.
Be that as 1t may, the return of
| the pound to par will consolidate
England's position as the financial
center of the world. When the
pound was falling the tendency Of
the world was to look to New York
But gradually, as we balanced our
budget and guaranteed our SOL
vency, the pendulum swung back,
and when normal conditions obtain
it is unlikely that our supremacy
will again be challenged. World
shipping is a main factor In estab-
fishing q nation as a financial lead
err, and as long as England main.
and the pound keeps at par her po-
sition Is assured.
Another clear benefit remains
Britain can exect to attract further
foreign capital. The great investing
public in Paris, in Buenos Aires, in
New York, and, of course. in our
own country will have a clear in
| ducement to place their money in
Britain.
Need Foreign Capital.
They will not only obtain Sc
curity for themselves-by their very
purchase of our securities they
will cause these securities to be
more greatly in demand, and con-
sequently to rise. 1t may be said
that, with the low rate Of interest
in England, we have no need to
use foreign money. But, in the
long run, every influx of money
means new activities, new factories
and more work. Thus 1t Is not
too much to say that before long
the rise Of the pound will have
beneficial effect upon our problem
Of unemployment and might, by
stimulating trade, be beneficial to
our taxpayers.
| America is anxious to do her
best to help. AS the holder of the
greater part of the worlds gold,
she has assisted the pound to rise,
and it is not impossible that she
might. If she so desired, use her
| influence to depress it.
! Therefore, one of the chief rea'
| - 4. ~.