The midland journal. (Rising Sun, Md.) 1885-1947, 1925-04-03
SOUND PRINCIPLES
FOR ALLIED DEBTS
PAYMENTS to America Should Be
Guided by Dawes Plan,
Says C. {. Mitchell.

The fundamental principles OF the
Dawes plan for settling the European
war debt question are applicable to
the problem of the Allied debts to the
United States, Charles E. Mitchell
president of the National City Bank
of New York, declares in an article In
the American Bankers Association
Journal. Mr.. Mitchell says:
"Debts between nations are always
a source of international trouble. and
] consider it of great Importance that
relations with such countries as
France, Belgium and Italy may be i'm
proved by an early adjustment OF
their debts to our own national gov
eminent.
Country Endorsed Dawes Plan
81 hope that we are gradually learn
ing that such debts, If urduly forced
may result more calamitously to the
commercial interests of our own coun
try than to those of the debtor coun
try. This talk of forcing payment OF
every dollar to the last penny, is
commercially unwise. think we may
assume that the Dawes plan has had
the Endorsement of the American PEG
pie through their election of General
Dawes to the Vice Presidency of the
United States. That plan is one that
establishes fundamental principles
which may be applied in considering
the debts of one nation to another
resulting from war.
''The first principle, as sea it, IL
that the yoke Of the war debt shall
not be held as burden upon the
people beyond the generation that had
to do with the war. This principle is
clearly intimated in the fact that the
industrial and railway debentures
which form the principal secusity and
means of payment Of the debt carry
per cent interest with l per cent
amortization, which means that such
obligations are to be over period OF
about thirty-six years.
An Invitation to Trouble
"Any attempt to force the carrying
of such debt burdens to the second
and third generations is but an en-
graved invitation to further trouble
"The second principle is that the
debtor country shall be taxed to the
limit while tho debt remains. but. in
no event to a point where its eco
nomic structure collapses under tbs
strain, and, further, that the nationals
of the debtor country shall in no case
have a lesser burden Of taxation upon
them than have the nationals OF
the creditor ceHntry-another princi
pie the soundness OF which cannot be
questioned.
1.-THE third principle is that with
such taxes collected. payments there
from shall be made to the creditor
country to such an extent only as the,
can be made without disrupting inter
national exchange and commerce. TIL
soundness of this last is apparent or
its face.
these regard as the fundamental
principles of the Dawes plan, and al
of the hundreds of pages Of the So
called Dawes report are devoted t.
setting UP the machinery by which
these principles can be put into effect
"If these principles are accepted as
sound then they must also be SCUM
principles by which the payment o
the debts Of allied countries to us
shall be determined. and we woule
best apply such yardstick as our
measure, rather than attempt to make
popular the slogan of every dollar to
the last penny In the adjustment OF
our foreign relations, essential to the
development of increased export and
import trade, there can be no problem
of greater Importance than reaching
a sound and final conclusion as to this
irritating question of the debts Of al
lied countries to ourselves"