Evening star., 1925-10-02
PAR[EY REVEALS
FRANCE WILL PAY
Conference Accomplished
Much That Is Not Appar-
ent on Surface.
BY DAVID LAWRENCE.

Joseph Caillaux, French finance
minister, told members of the Ameri-
can Debt Funding Commission that ne
might be back here for another con-
ference within six months.
From this as we'll as informal ex-
pressions during the debt negotiations
of this week the statement may ne
made that France intends to settle
her war debt with America just as
soon as there is political agreement in
France.
For while on the surface 1t may ap-
pear that the negotiations came to
naught, the truth is a good deal more
was accomplished than the skeptics
ever dreamed. Provisional unaer. %
standings were reached which carry
the negotiations forward beyond any
point they have been since 1918.
Principal Results.
Here are the principal achievements
of the conference:
l. France recognized formally her
debt of So, 200 900 900. and this together
with the amount already recognized
of S407 900 900 for war supplies makes
a total of more than three and a nan
billions of principal. No recognition
of accrued interest of $S00.OOO,0o0 was
put down on paper.
sively to the French that the United
States is more generous In her terms
than was Great Britain In the recent
Caillaux- Churchill conference. This
astounded the French. but the Amer
leans worked 1t out in cold ngures'
and the French are still ponderfng
over the effect Of this when French
public opinion digests the truth.
8. America placed on record an ar
gument that is somewhat new in this
type Of negotiation-namely, that 1t
does not matter so much what a
debtor country promises to pay SO
or 60 years hence. but what is the
present day market value Of these
promises to pay. In other words.
America told France that an annual
payment Of s100. 900 900 in the sixty
third year would not bring today
per cent of that amount. Senator
Smoot, indeed, remarked to NJ Call
laux that the $4,000 900 of deferred
payments which the French said they
would be willing to pay in the six
years following the expiration Of the
62year period would not bring today
on the market a total Of $50. 0.000. 900 in
cash and that America might Seri-
ously consider forgiving such a sum
if it were deferred and take 0.000,-
600 in cash.
4. The Americans drove home the
point that actual cash payable In the
next IL years counted more than
promises to pay in the succeeding so
years.
Agreement Has Real Value.
8. The French actually signed a
proposal which is an index of good
will that cannot be underestimated.
for many people here thought the
whole trip to America was a gesture.
The American commission is con-
fident that the French government
will find it difficult to reject the last
American offer, which is that the
five years. which includes the $780,
100000 a year already being paid on
war supplies bought after the armi-
stice. America by proposing another
debt parley at the end of five years
struck a body blow at the security
clause idea, which has been hanging
over the negotiations from the start.
Senator Smoot is understood to have
assured his colleagues that 1t would
be next to impossible to get through
the Senate a security clause such as
the French suggested.
Instead, America has pointed out
that If the debt is to be revised down
ward because Germany fails to pay
1t might as we'll be understood that II
ought to be revised upward If Frances
capacity to pay becomes better than
has been expected. There are indica-
tions that the French didn't expect
the thing to work both ways and that
this kind of tactics may see the end
OF future proposals about safeguard
clauses.
Credit Need Spurs France.
What will be the immediate effect
on the conference here? For one
thing the French will consider a long
time before turning down the Ameri-
can proposal. If they do, they will
not get credits from American
bankers. And although outwardly the
French are anxious to make it appear
they do not need new loans, the Amer.
lean commission has information to
the effect that French finances will
require Encouragement with funds
that are available only nowadays
through American private bankers.
As for the other debtor countries,
Czechoslovakia's mission is soon to
confer with the Americans to settle
the 500, 900, 900 war debt. Italy's mis-
sion proba bly, will not come now that
the French-American negotiations
have been postponed. America, too,
would prefer to await the outcome Of