Evening star., 1926-09-05
GREAT FIGHT ON TARIFF
is NEAR, EXPERT BELIEVES
American Bankers Policy of Investing
in Foreign Securities Opposes Manu-
facturers' Interests, Editor Says.

/, important domestic effects Of our new
policy of lnnding money to the world.
And this effect is going to be to divide
American business men on the ques-
lion of the tariff--the bankers against
tn" manufacturers.
"I do not want to stress the purely
partis;4n implications of this But, of
ou' So II is obvious we cannot have
great political quarrel over the tariff
without serious effects on the parti-
san agencies through which the peo-
pie express themselves. The most Sc
rious effects will undoubtedly be
found in the Republican party. and
already we can notice the lines being
formed. But the Democratic party
has it's tariff babies and its tariff ad-
vocaies Just as well. Some OF them
are outspoken And others are quite
as faithful to the tariff idea for their
own industries, though they talk
against the tariff. The South for a
long time has been interested in
sugar and rice and lumber and other
products. But now the South is be-
coming a great industrial region, and
il is adding new tariff protected COM
modities to it's list-iron and textiles,
to say nothing of numerous other
articles All this is having a pro-
found effect on the tariff beliefs Of
Democrats.
Wedge Between Leaders.
"One Of the first purely political
effects of this struggle will probably
he n wedge between the President and
his Secretary of the Treasury. / do
not speak of an open breach. l mean
a drifting apart. Mr.. Mellon has been
foremost among those American
ffnanciers who have stressed the I'M
portance OF loans abroad. ON the
other hand, Senator Butler OF Massa-
chusetts, who is the Presidents 8
friend as we'll as adviser. represents
a region which is dependent upon
tariff protection in a very high de-
gree. The clash between these two
interests is inevitable"
"Do YOU see any other danger con-
nected with this crisis In the tarlH!
l asked.
ahead if our foreign industrial cred
itors cannot pay their bills. And as
T have pointed out. there will be an
excellent chance Of their not paying
those loans If they cannot sell IN this
market
ALREADY European economists
have pointed out that II America
keeps on lending to Europe at the
present. rate and refuses to lower her
tariff walls to permit her debtors 10
sell here, then the rest OF the worio
will be in peonage to the United
States.
L.. S, Would BE Dictator.
"The United States would be in a
l;o<a of
nations. who would be forced to bar
gain for an extension of the time OF
pavment often. Thus, the United
States could easily become creditor
Colossus and bestride the world with
an ominous shadow.
How long would the rest or the
world abstain from common cause
against a perpetual creditor! Nouio
they seek relief by waging war
against their oppressor. or would they
he forced to defend themselves from
an attack by their oppressor If they
renudiated their debts. l used the
word .oppressor.' A good many loans
now being made abroad are by power.
full banking houses. They could holo
a life.and-d death power over loreiSn
industries. No one could tnlnk OF
them as being charitable IN the long
run. They could undoubtedly toreciose
and take over the property OF their
debtors. That has happened to many
countries in the past-foreign credi-
tors have simply closed and begun a
controlling economic influence withn
a country that has been a constant
embarra ssment to foreign govern
ments. That's the crux of the matter.
If our debtors can't pay there VIII pe
trouble and If we permit them to pay
here will be trouble. The tarin is
bound to be the center of a furious at
tack in the near future
downright 1g26.)