Evening star., 1924-12-14


vinced that France and Italy are nei-
ther of them likely in any immedi-
ate future to be able to face any such
payments as the British have under
taken. Their point of view is quite
practical, is indeed an application of
the underlying principle of the Dawes
plan, that payment must be based not
on the sum that ought to be paid, but
the amount which can be paid.
Want Most Favored Terms. -,
But such position does not i'm
press the British, whose contention
is that they are entitled to as good
terms as any one else from the United
States, and-since they are paying us
to just as prompt payment to them
selves from the continental nations
as these nations make to America.
What they regard as just solution
would be the granting to tho CONT
mental states Of more favorable
terms and the modification Of their
own agreement with US to include the
same terms. The question OF the
relative capacity to pay does not ap-
peal to them.
Manifestly the British are on sound
ground when they argue that their
claims against Frence are just as
valid as ours, and therefore that
French payment to them must paral-
lei French payment to us. They are.
of course, relying upon sentimental
rather than practical arguments
when they contend that our terms to
France and Italy should be Identical
with our terms to them or vice versa,
because any creditor has a perfect
right to deal with his various debtors
in any fashion he may choose, par
ticularly when he has to face vary
ing degrees Of capacity to pay.
Rexara Loans - Subsidies.
But the situation il complicated
further by the fact that neither the
French nor the Italians regard their
British debts in the same light as the
American, considering British loans
as no more than subsidies in the old
sense-contributions to a common
cause by a nation which was bound
to contribute money. France, with a
vastly larger death roll from the war
and with her devastation beside, re-
CARDS cancellation of the British debt
as an act of justice pure and simple
and Italy has the same opinion. 1t
is almost automatic that the conti-
mental debt to Britain will never be
paid, and the British have long recog-
nized-that is, the financial world
that approximate cancellation was
inescapable.
But in the same sense the mass OF
Britons believe that the United States
should have Cancelled it's debt; that
the obligation was legal not moral.
They see US, an immensely rich ma
ton, driving a hard bargain with
them and they see no reason why
they should forego continental pay
ments when the ultimate effect would
be to enable tho continental states
to begin payments to us. And having
the power of veto, by reason of con-
tinental debts to themselves, they
are prepared to exercise 1t. They
can, indeed, bring a certain pressure
upon us to reduce our terms with
them by preventing the continental
nations from making any terms with
US. This latter they can and have
Accomplished In the present in
stance by demanding-not yet Of
hcially, but not less effectively-that
France consider her debts to Britain
in the same light as those to Amer
lea.
Cannot Bear Double Burden.
As for France and Italy, they can
not undertake the burden OF British
and American debts, and they are de-
termined never to undertake the
British debt at all. save In the small