Evening star., 1925-10-02
The Unsettled Debt.


Americas final proposal to the
French Debt Commission-the pay.
ment Of 100000 900 a year for five
years, with the understanding that
definite funding of Frances war debt
he postponed until the end of that
period-was the only course remain.
ing, in view of the wide difference Of
opinion that existed between the
French and American Debt Commits
sions. An impasse had been reached
commission Is leaving the United
States without having assented even
to this proposal, which goes no fur.
ther than its own estimate Of Frances
ability to pay during the next five
years. NJ. Caillaux. the minister of
finance and head of the debt commits.
sion, has promised to submit the
American proposal to his government
and to give an answer as soon as pos.
sible. 1t would appear that the gov.
ernment Of France could do no less
than accept. A refusal doubtless
would encourage the belief in the
United States that France has no real
intention Of settling this very just
debt. and France cannot permit that
belief to grow.
The attitude Of France has been un.
fortunate in the debt negotiations.
from which so much was hoped by
that nation, by the United States and
by the rest of the world. The senti-
ment of the United States Government
toward the funding OF the French war
debt was we'll understood in France,
but while protesting it's willingness to
pay, the French commission entered
the negotiations from the start as a
barGainer, not so much concerned
with justice as with a desire to get of
as cheaply as possible. Had the
French come to the conference table
with a frank admission of the debt
and statement that France intended
to pay it to the utmost of its capacity,
an entirely different atmosphere would
have been created than when, at the
opening of the negotiations the French
put forward a proposal that was SO ri
diculously low, that begged off so much
OF the debt, it could only be regarded
as a trial balloon, the first step, for
example, In horse trade.
AT the bottom of the difficulty over
the war debt lies the unfortunate
propaganda spread among the peo.
pie of France since the close of the
war that the war debt to the United
States is not moral obligation. OF
course, the debt exists. The United
States holds demand notes given by
France. bearing per cent interest.
There is no fiction about that. AS long
as those notes remain unsatisfied by
a definite funding arrangement or
payment France will continue in the
position Of a debtor.
The effect of the failure Of the
French government to agree to the
f1ve-year proposal now put forward
by the United States might we'll re-
fleet seriously on the efforts of France
to set her financial house in order.
The French, as Is generally known,
are anxious to obtain further loans,
and America is the great money mar
ket of the world today. 1t can scarce
lv be expected that the Government
of this country would view with
equanimity loans by American bank
ers to France as long as France con-
tfnues to decline to make any settle
ment-eren temporary-of the French
debt to the United States.
Before coming to America, NJ. Call
iaux had reached a tentative agree
Inent with Great Britain regarding
Frances debt to that country. It
will be interesting to observe now
what the effect of the negotiations in
Washington will have on the con-
summation of that settlement with
Great Britain.
France sought here terms of settle
n1ent that were more favorable than
those entered into by Great Britain
in her settlement with the United
States and more favorable than those
which France herself has tentatively
made in regard to the French debt to
the British. She sought terms from
the United States more favorable than
those included in the debt settlement
Of Belgium with America. She sought
terms that could not be granted.
When 1t had become evident finally
that the American and French COM
missions were so wide apart-a billion
dollars apart-that further negotia-
tons would be futile, the word was
carried to President Coolidge, and
the President. as on more occasions
than one in the past, made it clear
that he firmly adhered to the Ameri-
can position on the war debts. Like
the Bellman in Lewis Carroll's Hunt
ing of the Shark" the President, in
asserting to a break in the negotia-
tions, might we'll have unused:
Now. that you've stated the whole
Of your case.
More debate would be simply OBJ
1. surd."