Evening star., 1925-09-13
CAILLAUX STALKING POLITICAL
FUTURE ON u. S. DEBT TERMS
Hopes For Terms Like Those, Agreed By Britain
But Hope Seems Certain of Failure
in Coming Parley.

is paying her vast debt to America,
since America has no one to pay,
America cannot afford to play the
! Shylock-his own word, often re-
peated-and that in fact America will
not do so.
Held Out Hopes for Cut
He even held out hope, which was
not taken very seriously in London,
that after the United States has made
a less than per cent settlement with
France, she will ultimately feel com
{ PEELED, for moral reasons, to reduce
the Baldwin Anglo debt
agreement in Britain's interest. He
went so far as to assure ministers and
bankers here that should the United
States at first refuse to negotiate on
the British basis, he will order the
French delegation to take the next
boat home, confident that what he
calls the moral factor will ultimately
bring Washington to heel.
These facts are of great Importance
to the United States. Presumably
Caillaux is wrong, and, despite what
Britain has done, the American de-
mand for a much greater proportion
ate sum than Churchill has accepted
will be presented. If so, and if Gail
laux does break off negotiations, the
most unpleasant international finan-
cial situation on record, with the eX-
ception of the reparations dispute, will
have been created. CaillauX may fall
from power if his scheme goes wrong.
1t seems he will. But an awkward.
indeed tragic, muddle will live after
him for his successors to grapple with
as best they may.
That is an exposition of the Situa-
ton as Caillaux sees it, or as he tells
the British he sees it 1t may be diff
ticult for Americans, who view the
whole matter so differently, to be
lieve that the astute French finance
minister is serious But apparently he
is. He can scarcely have been bluff
fing the English, for there would be
no object in such bluff. He has, it
seems, hazarded his political fortunes
that he is right.
Churchill Using Political Skill.
Winston Churchill and the British
treasury experts, during the recent ne
gotiations with Caillaux, approached
the whole subject from quite another
angle. Caillaux did not convince them
that he could get the United States
down to a ''2 per cent settlement" He
may have made some impression on
a few of the politicians, but the big
bankers refused to take his theories
seriously, and neither the treasury
CheQuer suffer under any illusions as
to the terms the United States is like
ly to exact from France.
But Winston Churchill is a con-
summate politician. and as 1t seems
in the light of considerable knowledge
Of the debt negotiations here,
Churchill decided to fall in with Call
laux's wishes for his own purposes,
not Caillauxs. Why, if the British
know that America will ask France
az per cent, conceivably 34 per
cent, and certainly not less than 3 per
cent, was the British offer to take
per cent officially promulgated to the
world? The answer is. it appears.
that Churchill wishes to get not S62,-
500 900 a year from France, but from
SS5 900 900 TO 500, ,00O. 900.
But he knows France would never
agree to pay such a sum to Great
Britain In negotiations direct between
the two countries. He thinks France
cannot, however, resist in the end the
financial pressure America can bring
upon her. and that she must meet
the American demand. Britain will
! then be able to claim, in accordance
| with the formula he laid down in
Parliament, payments 'pari passau,
which means that Britain Will get pro-
portionate amounts from France to
those paid the United States
Churchill has financial weapons up
his sleeve in the shape of vast sums
owed by the Bank of France to the
Bank of England, and a large bond
Indebtedness shortly maturing, which
can be used, If necessary, as means
of pressure.
Policy Laid Down.
Just a few more figures, the last In
this article. will furnish strong cir
cumstantial evidence that this is the
true view OF the British position. Lord
Balfour, and later Churchill himself.
have laid down most emphatically the
corner stone Of British policy on inter
national debt which IS now accepted
by all parties and which cannot be
changed. Any ministry which sought
to change it would risk being driven
from Office by the tortured taxpayers.
That principle is that Britain insists
THE BEST $500 HAT