The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-06-26
GERMAN ABILITY
TO PAY NOT
SETTLED
Dawes Report Does Not Solve
Preparations Problem,
Says Bank Review
BY International News service


NEW YORK, June 26. Tbs
dawes report has not definitely
settled the question of the Germa n
reparations, according to Mechanics
and Metals National Banks June
financial review.
The problem Of how much will
trip the repartion creditors for q
long time to come. The exnertc
responsible for the Dawes report
very ably laid out plan for meet.
ing the problem of Germany's sol.
Vency and for producing q paper
mark surplus within the country.
put In determining the matter OF
transferring that surplus to foreign
countries, in funds acceptable to
those countries, they were carefully
restrained.
To have a clear understanding Oh
the difficulties involved one must
know that the problem of repara.
ton payments is in the long run a
problem not of politics but Of for.
elgn exchange. Germany cannot
transfer its factories or its railroads
bodily to its creditors; it's supply of
gold Is too small to pay even a
fraction OF the indemnity. and ita
paper money is unacceptable. Hence
the only means by when the nation
can satisfy the reparation demands
IS by building up an enormous sur
Plus OF exports over imports. so
that the resulting credit can provide
balances against which bills of ex.
change may be drawn to settle the
obligations in sterling, francs, or
other appropriate currencies.
Fixed on Sliding Scale
Preparation payments have been
fixed on a sliding scale, to run
from $500 100000 in 1925 to $685..
100000 in 1884, subject to additional
reduction in certain CONTINGENCIES.
To make such payments effectively
Germany must reverse it's familiar
position in foreign trade and be.
come nation that exports far
more goods than it imports. nv
its nature Germany has up to now
been an importer Of materials more
than an exporter.
In the five years before the war
1SOS-1S14-years Of Germany's great.
est prosperity-the average annual
imports were $500, 1000, 900, against
average exports Of $420, ZOO. 900. In
the first three months Of the pres.
ent year alone the German foreign
trade deficit amounted to $1S7 ,VO0,.
900.
Shut Out German Goods,
Whether Germany can so far de.
velop and adjust its industries as to
become a great export nation re.
mains to be seen. Also it remains
to be seen whether other countries
care to have Germany assume the
role Of so great an export nation as
suggested by the above figures. As
for that, the attitude OF the various
countries may be judged from the
measures they have already taken
to establish themselves in the ex
port markets, at the same time that
they have sought to shut out CHEAP
German products which might prove
the ruin of their own manufacturers
and merchants.
1.-THE worlds stand on the repa
rations may be described like this
We believe Germany should be
forced to pay; if we find that she
can, by lingo we won't let her!
1.-THE situation is one full Of in
teresting possibilities, but at least
one of it's most battling complexi
ties is now removed. Preparations
have been taken out Of the realm
of sentiment and feeling and are
now in the realm Of economic com
mon sense. That greatly simplifies
the ultimate solution"