Evening star., 1924-09-07

get the foreign loans without which
her economic system Will crumble,
cannot get started again in national
life without undertaking certain pay
ments The price is high, but the
alternative staggering.
France confesseS that while she
can stay in the Ruhr and get a meas
ure of reparationS-for the occupa-
ton. following the Micum arrange
ments. is turning out by no means
unprofitably-she cannot have peace,
her relations with her neiShbors tend
to worsen and the returns from the
Ruhr occupation are by no means
commensurate with her needs or with
the promises of the Dawes report.
She will sell he Ruhr occupation for
a price. which also represents great
sacrifices, but also stands for the
best market available.
Now, unhappily, the British state
of mind is less clear and gives far
more reason for anxiety than either
the S'rench or the German. We have
seen how at the Paris conference in
1919 the British outdid the French in
their demands for saddling the Ger
mans with enormous reparations. 1t
was SmutS, acting for Lloyd George,
who persuaded Mr.. Wilson to permit
the inclusion of war pensions and sep
arations allowances in the bill, thus
almost trebling it. Yet not many
months later British policy was
eagerly demanding an enormous re-
duction of this total.
Changes BY English.
When, long before the Ruhr days,
Germany showed signs of resistance,
Lloyd George threatened an occupa-
ton beyond the limits fixed by the
treaty of Versailles. and on the eve
of the French march into the Ruhr
Bonar Law, while expressing doubt
as to the method wished the French
luck. Yet a few months later the
British government proclaimed that
the occupation was illegal.
Today the whole world is watching
with some amazement the outburst
in London of criticism of the success
of Mr.. Macdonald in getting the
Dawes report adopted, and thus in
surfing German recovery. For several
years all British policy has been con-
centrated upon accomplishing pre-
ciSely this rescue of Germany, and
now, when the sescue seems assured,
not alone the Right. but the Left. not
merely the ie-hards, but the miners,
are clamoring for some new steps to
prevent this German recovery from
injuring British trade and industry.
The new phase which we are just
entering, then, promises to be quite
as difficult as those periods which
have preceded for the simple reason
that there remains the essential con-
fict of interests. What, after all, is
the German digestive now and al
ways? Obviously to regain economic
and financial prosperity and at the
same time to keep down to the low
est possible figure the amounts paid
by Germany to her wartime op-
ponentS.
Germany Makes Demand.
In the debate over london agree
ment in the Reichstag the National
lists demanded that the government
ask of the allies pledge that two
years hence there should be new
examination of German capacity,
with the idea of obtaining further
reduction of the reparations pay
ments. OF course, this was out of
the question then, but it opens vista
for the future.
At the same time the British min
ers were clamoring that their gov
ernment take steps to prevent Ger
man recovery from injuring British
coal trade. But how, since Germany
must pay largely in kind and in coal
to France and Italy? The London
agreement lays upon Germany the
obligation to pay largely and neces
sarily in kind. but what would the
situation be if the British govern
ment intervened to insist now that
Germany should not pay in kind in
any direction which might injure
British trade? OF course the thing
ends in an abSurdity.
Beyond lies the even more puzzling
problem. that Of possible combination
of German and French heavy indus
tries, iron and steel. France has the
iron which Germany lacks, Germany
has the coal which France lacks, but
Germany in any event will now have
to supply France with coal under the
reparationS agreements of the Dawes
plan. Automatically this German
coal will replace British in the
French market. This is inevitable
but what more natural than that
there should be combination of
these two heavy industries, French
and German, a com mbination which
existed measurably before the iron
region of Lorraine was restored to
France by the treaty of Versailles?
Working Plan Possible.
France with a deprecated currency
Germany with depressed standard
of living and an increased working
day, having together unlimited re-
sources in coal and iron, might easily
arrive at some such adjustment as
the French and German potash pro-
ducers have recently made and thus
start competition with British
heavy industries which would be
ruinous in the ertreme, just as the
German coal deliveries in any event
menace the British coal industry.
And just this kind of combination
has always been in the back of
French minds and has been rejected
by the Germans largely because the
French sought not mere combina-
ton. but control of the combination
Now France stands in new rela-
tion to Germany. She is going to
evacuate the Ruhr; her present gov
ernment has shown a totally differ
ent. spirit in dealing with the Ger
mans. She can offer Germany in re-
turn for economic advantages
speedier evacuation of the Ruhr, an
earlier withdrawal from the occupied
area on the left bank of the Rhine,
where she has still ten years to stay
under the treaty of Versailles and
as the principal creditor of Germany,
holding 81 per cent Of the claims, and
assisted by Belgium, which holds
per cent, she can use this gigantic
debt as a basis for bargaining
Britain, on the other hand, is in
this situation: Most of her.experts be-
lieve she cannot afford to take repa-
rations at all, since Germany can
only pay in materials, raw or manu-
factured, and such payments would
only lead to the immediate expansion
of British unemployment. Her in
terest remains still in furthering the
reduction of German reparations. the
reduction not merely of what Ger
many has to pay Britain, but the re-
duction of what Germany has to pay
France, Belgium and Italy, since
such payments will necessarily be
made in precisely the commodities
CONTINUED on Third Pagel