Evening star., 1923-03-10
'LEFF|NGWELL 0,k,'S
CR0SbY'S DENIAL
Assistant Secretary Says
u. S. Did Not Force Brit.
ish Guarantees.
RUSSIAN CASE CITED
Balfour's Memory Of Later Incl.
dents Foggy. Belief Of
Ex-ORcial,
by the Associated Prpss.

/ by the Associated Pre~,
| NEW YORK. March iQ,--R. {, Lef-
| flngwell, assistant secretary Of the
! Treasury during the Wilson admfnis-
tration. today Joined with his coll
league. Oscar T. Crosby, former pres
ident Of the interAllisd council Of war
purchases and finance. IN asserting
that America did not force Great
! Britain to guarantee loans made the
allies.
! Mr.. Letingwell said he regrets that
! Amba ssador Harvey's attack on Lord
! BaliourS note and Balfours reply
had revived a controversy that could
serve no useful purpose now that the
! British debt settlement was accom-
Mr. Lefingwell said that England
might not have been forced to borrow
money had she not financed allied
| buying in her own territory, but the
! only debts for which she was respon-
| sibie to US we're those which she in
| Cured on her own account.
| Mr. Crosby, assistant secretary OF tne
! Treasury during the war. empnalicaily
| characterized Yesterday as wlsap-
prehens,on' the assertion OF Lord Bal
| four in the house of lords that the
| United States had demanded BRITISH
| guarantee before financing other allies.
| Entering the controversy in London
4
dor Harvey, Mr. Crosby, who dis
! cussed war loans with Lord Balfour
| when the latter came here in 1917 as
| head of the British high commission
and who later served in Europe as
president of the interallied council
! on war purchases and finance. de-
clared he could recall but one incl
dent on which the "misapprehension
| might be based.
RUSSIAN Lean Incident.
! This incident, he said, was the grant,
| ing to Russia of IA relatively small
| loan of $4,000, 900, upon British in
/ dorsement, at a time when Russia was
represented here only by a charge daft
| flares. holding over from the czarist
! regime. with no authority to sign obli-
cations for the provisional government
Of Russia. Mr.. Crosby admitted. how
ever. that this loan had been left to
the charge Of Great Britain.
] Referring to the Russian loan. Mr..
Crosby said that the situation seemed
ito have been so dominated by British
| it was wsse to leave the account as We
| found it. We knew nothing Of the Quid
| pro quo which might have existed be-
tween the indorsing government.
! Great Britain, and Russia.
Lord Balfour." said Mr crosby,
! Thought ne should have taken over
this relatively small amount and fancy
his memory has retained the fmpres-
sions resulting from the incident while
he has not kept pace with the other
vastly larger transactions. in which ms
government was not asked to assume
any responsibility whatever FOR allied
purchases, other than British, in our
markets.
Text OF Statement.
Mr.. Crosby's formal statement fol-
lows:
"I can recall but one incident
which, remaining in Lord Balfours
mind. may have given rise to the
Observation-Disclosures appearing in his
last statement. Tt occurred while
Lord Balfour was In Washington.
and discussion concerning it was had.
"Shortly after our entrance in the
war, it became my duty to obtain
statement of the commitments OF the
various allied governments for mate
rials under contract in the United
states. This statement was had
from j. P. Morgan and Company. who
were acting as fiscal agents for Great
Britain and other allies.
McAdoo Rushed Loans.
"Secretary MoAdoo had not waited
for this report before making loans
under the act of Congress approved
April "a, 1917 With his usual
promptituIe. he had the Presidents
approval for a loan Of 100000. 600
to Great Britain on April 25. This
directly made to France and Italy as
soon as the money could be found,
and before the first liberty loan was
! f1oa ted.
Meanwhile it was clear that we
should know how much We were ex-
cover their needs in the United
States. When the Morgan statement
above mentioned was received. I re-
ported to the Secretary that II showed
about s170.000,000 of contracts for de-
liveries to Russia but with British
Endorsement. Russia was at that time
represented only by a charge daft
faires holding over from the czarist
regime. He had no authority then to
sign obligations for the provisional
government of Russia. Secretary Nc
Adoo could not lend money without
having corresponding obligations of
the borrowers. As soon as the neces-
sary authority was given, loans were
made directly to the new Russian
government without indorsement of
any other government.
Commission Fixed Program.
The program OF purchases for Rus
sia, both in the United States and
Great Britain. had been made out by
| a commission sent to st. Petersburg
| under the leadership of Lord Miner.
While the commitments of the big
belligerents We're at once taken over
| by them from loans made directly to
| them, this one, just mentioned, for
Russia was left to the charge of
Great Britain.
There was no discussion as to
British responsibility for the pur-
chases here of the other allies. But
as to this Russian affair, it seemed
to have been so dominated by Brit
| ish influence necessary, doubtless,
in the confusion of the time) that
Secretary McAdoo felt IT was wise to
leave the account as we found it.
Recalls II very We'll.
ct remember the discussion very
we'll and assume my small share Of
responsibility, as the one in charge
Of the f1scal bureau for the Secretary.
in that I advised him: to follow. this
course. We knew nothing OF the
Quid pro quo which might have ex-
listed between the indorsing govern
| rnent, Great Britain. and Russia. No
opportunity had been given the
United States to consider the pro-
priety Of these Russian commitments
'for the better prosecution OF the
war Secretary MoAdoo never in
sisted upon any vexAtious inquiry
into the reduis{tions Of the allied
governments. but it was his duty to