Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-08-29

this point and 1t is quite likely that in the
coming year some of them may be actually
marketed.
The most interesting feature of the second
year was the actual transfer of cash, in which
form about onethird of the years payments
were made. The experience of the transfer
committee. whose business it is to get the
German payments across the exchanges into
the hands of the creditor governments, is that
there is essential difference between the
deliveries in kind represented by commodities
and the transfer of cash.
But the transfer committee has all of its
future before it. Up to the present German
borrowings abroad have effectively created
adverse balance which reparation payments
have been offsetting. When German borrow
ing and the imports and exports of all
kinds offset each other, the transfer committee
will face its real job. At that time the problem
will be how to keep the international balance
of payments unbalanced so as to enable the
creditors to get their money goods The
obvious answer to the problem is to allow
the balance of trade permanently to stand in
favor Of Germany. 1t remains to be seen
whether the rest of the world will be willing
to see German foreign trade expand actively
so that the creditors passively receive
what stands the books due to them.
The problem is entirely that Of the credi-
tors. including the United States. for Ger
many's obligation is wholly met when pay
ment in marks is made In Berlin to the agent
general Whether the creditors ever actually
get the money is none of Germanys business
or responsibility. All experts agree that sooner
later the transfer Of the money will be a
problem. but there is no indication that 1t
will develop In the third year, which is about to
start
JJp to date the creditors have been en-
tirely willing to accept German products in
the necessary quantity Their is an elaborate
IoJtx,o .iv,6 NV
which French requirements in particular are
met under practically normal trade conditions,
the German government paying the German
seller and the French buyer paying the French
government, the two government accounts
figuring the reparation books. Belgium has
declined to take coal deliveries in the third
year and these represent virtually half of
her past receipts, the coming year will afford
interesting experience in diversifying or in
venting new methods Of receipt.
Quite likely Belgium will put PREPARATION
recovery act into effect. Under such act
Great Britain is obtaining all her receipts ex-
cept those for the army of occupation. In ef'
feet the act provides for the deduction by the
British purchaser of German imports of 30
per cent of the price which is turned over to
the British government reparations The
German shipper is recouped by his own gov
eminent through complicated arrangement
to which many thousands Of German exporters
are parties. The settlements figure as cash
transfers.
The first reparation year closed with 1O7,
600 90 marks in available but unclaimed credits
on the agent generals books. On May 81, at
the expiration of nine months of the second
wear. a balance of 90,000,000 was practically
all held to meet commitments effectively made,
a third of which was at American disposition
The French credit balance, for instance, stood
at 80 1862, 900. but contracts for 24,695OOO
marks of goods were being executed against
the credit In nine months the French had
free balance of only 5,667000 gold marks in
share then attaining 461,73o,00O The utill'
zation Of credit therefore up to 1873 per
cent, which is fair indication that the Dawes
plan is operating smoothlyA
Something has recently been said about
the cost of the Dawes plan as il the creditors
and Germany were worrying about that All
costs are deducted from the total received from
Germany, that if the creditors choose to
spend the receipts on costs that is their az
fair and at their expense, consciously incur
red The cost of the interallied commissions
and arbitral bodies in the second year was
to be only 23, 800, 900 gold marks, of which two
thirds went to the Rhineland high commits
sion, in charge Of the occupied regions, ana
to the military commission of control which
has now practically worked itself out of ex-
istence The reparation commission and the
office for reparaton payments account for about
1000 900 gold marks. The personnel or the
Dawes organization, the only one of the four
which is efficiently built in an objective sense
numbers 1873, of whom only 119 are paid from
the annuity.
The other expenses deducted from the
nuitv in the second year We're the service
of the German external loan. 92.260,O00 gold
marks, the arrears on army costs, current
army costs, the Belgian debt interest and
sinking fund and the cost of resolutions. The
American claims. 1852, 900 gold marks, hg
o- rrn1rurD cr