Evening star., 1925-08-02

weakest of the allies was just as
good as that of the strongest.
Helped Keep Prices Down.
II is true that some confusion was
caused by the necessity Of co-ordinat-
ing purchases, in order to prevent
the allies from bidding against each
other for American goods, and thus
running prices up, but this was ad-
justed by what was known as the
"dollar reimbursement" plan. and
when the books were closed the
United States Treasury held the de-
mand notes of each government in
the exact amount of the credits that
had been established in behalf of that
government. No ally had given guar
antee for a dollar of the borrowings
of another ally.
There was just one exception to
this rule, which requires to be ex
planned. Before the United States
entered the war Great Britain had
gone surety for certain supplies re-
quired by Russia. as Russian credit
at that time was not good with
American commercial interests. After
the collapse of Russia Great Britain
found herself obligated to make pay
ments on these contracts, and she
borrowed the money from the United
amount involved was relatively fnSig-
nificant, and Great Britain in large
part recouped herself by utilizing the
Russian supplies. This minor item
is all the basis there ever was to
the oft repeated and still repeated as
sertion that the stronger allies used
their credit to borrow money from
the American Government for use of
the weaker allies.
Had to Have Dollar Credits.
1t is clear, therefore, that this
latest French Offset claim is not like
ly to get serious consideration at
Washington. AS a matter of fact. the
loans made by Great Britain and
France to the other allies We're mere
ly carrying out a general agreement
that each of the nations at war
against Germany would provide the
credits for the supplies they were
called upon to furnish associates in
the war, and If Great Britain and
France had made no loans at all to
the lesser allies they still would have
had to borrow from the American
Treasury, for there was no other way
they could have gotten the necessary
dollar credits for the supplies they
absolutely had to have from the
United States.
In this connection it is worthy of
note that there was Just one country
which did not take advantage of this
arrangement for the mutual supplying
of credit, and that country was the
United States. The American Govern
ment made loans to 19 different gov
ernments which had declared war
against Germany, to a total of more
than $4,000, 200, 900, but did not ask.
reciprocal loans OF single dollar from
any one of these countries. While
American taxpayers and Liberty bond
buyers were providing the money
which enabled their Government to
lend these $4,000 100000 to the al
lies, they were at the same time pro-
viding the money which enabled the
American Government to pay spot
cash for all it's requirements in allied
countries. When it is known that
these dollar Disbursements, in ex-
change for foreign currencies alone,
amounted to s452 .000,0 900 in the case
of Great Britain and 81 ,026 900 900 In
the case of France, it is rather difficult
to see where the United States tried to
take any financial advantages of it's
associates in the war.
A Question of Taxations.
Another offset claim which is made
by France-the idea having been. first
advanced by former Finance Minister
Clementel-iS that the United States
collected large sums in taxes by virtue
of the expenditures made by France
within it's borders, and that the total
of these taxes should be deducted from
the French debt That argument is so
fallacious that it would seem to carry
its own refutation. but that 1t is given
credence in France is a fair index as
to the bewilderment of thinking which
affiictS the French people. 1t is on
par with the contention that there
should be offsets because the bulk of
the money France borrowed in the
United States was spent there for
American goods at high prices OF
course 1t is true that the money was
spent there for American goods at
high prices, just as prices were high
all over the world, and that the spend
ing of it enabled the American Gov
ernment to collect additional taxes and
the American people to buy additional
Liberty bonds. How else could the
American Government have loaned
the allies $10,000,000, 900? Had it
been American gold, instead of Amer
lean goods, the allies were in fact bor-
rowing, the loans could have amount
ed at the outside to not more than
$4,000 100000. Then there would have
been no more gold in America to
lend. AS a matter of practical finance,
it could not have amounted to any
thing like such a sum.
Hopes to Scale Debt.
/ mention these French offset claims
merely to show that while | believe
France intends ultimately to paw its
debt to America, it doesn't intend to
pay the full amount of the debt if by
any possible means America can be
persuaded to scale the total down.
Perhaps we should not Judge France
too harshly on this account. There is
an American slang saying that yon
can't blame a fellow for trying, and
France probably feels justified in try
ing every device. The point Is that
Americans should be on their guard
against French propaganda in the
matter of offset claims. 1t Is as right
as it is necessary that Americans
should hear the French arguments
and get the French viewpoint, but
1t is not right that they should reach
conclusions based upon ex parte state
ments. The sensible thing for Amer
leans to do is to hear the French
arguments and then find out what the
American answer is before making
up their minds. If the French have
any, arguments that we cannot ef-
fectively answer, then. by all means,
let us give them the benefit of such
arguments in effecting a settlement
of the debt problem.
Since being in France I am a great
deal less inclined to criticize the
French for their attitude toward the
debt than L was when I left home. /
find here Americans who are not only
willing to accept all the French argu-
ments but who are eager to provide
the French with arguments they had
not thought of on their own account
They are more pro-French than the
French themselves and more anti
A Arnnr.ican fha the most ra hid Of