Evening star., 1927-05-04
ENGLAND DEFENDS
WARDEBT STAND IN
+ NEW NOTE TO i. S.
Publication of Unexpected
Message on Question Set
for Tomorrow.
LONDON is SURPRISED
AS WELL AS AMERICA
Action Believed Result of Con-
troversy Between Mellon and
Winston Churchill,
nr thn assnciatcl Press.

By the Associated Press.
LONDON, May 4.-FuH exposition
of the British viewpoint as regards
the war debts is believed to be con-
tanned i'm lengthy British note
which has been dispatched to the
limited States, and publication OF
which is set for tomorrow morning.
News that the note had been sent
caused surprise in London. as there
was no intimation of its existence
unti1 word was received that Sir Esme
Howard, British Ambassador, had de-
livered it to the American State De-
partment.
Result of Controversy.
The note is understood to be the
outcome of the controversy over the
war debt between the American Sec
retary of the Treasury, Andrew w:
Mellon. and the British chancellor OIL
fbe excheduer, Winston Churchill.
II is thought to be in the nature
of a renlv TO Secretary Melons view
roint that Great Britain is receiving
more from her continental war dept-
ors than she is paying annually 10
the United States under the WASH
ington debt-funding agreement.
Recently numbers or letters nave
appeared in the British newspapers
challenging Mr.. Melons "misrepre-
sentations.
Secretary Mellon, in a. letter to Dr:
John Grier Hibben. president OIL
Princeton University, made pupnc
March 16. said Great Britain scne-
dule of payments from Ter depiors
called for q substantial amount more
than she would have to pay ON her
American debt.
Payments Called No Drain.
ar ;s tr1en he said, that in the
nast two wears Great Britain has re-
ceived from Germany, France ana
Itaiv about 100000 less than she
has paid to the United States. but 1t IS
equally true that from this year on
Great Britain every year will receive
from her debtors a substantial amount
more than she will pay to us, SO mat
her American payments viii not con-
sfitnte a drain upon her own economic
resources.
tt was true also, he added, that
Great Britain had agreed not 10
accept more from her debtors 1nan
the sums which, when added TO the
1.enaration payments from Germany,
would equal those which she pays 70
the limited states. However, even TAX
Ing this into consideration, 1t was op-
yio,lsIy inaccurate to say that the dept
ereernents which the United states
had made imposed a tremendous Dur
den of taxation on friendly countries
Secretary Melons letter was IN
.Tesponse to a statement by Dr.
lHibben and 116 members OF Ine
| princeton faculty endorsing one writ
ten by the faculty of political science
of Columbia University recommend.
ing reconsideration and REVISION OF
the debt settlements MADE Win llls
former war allies of the ohiteo
States.
Reply by Churchill.
A few days after publication OF the ,a
Sacratary's letter Chancellor Churchlii
declared in the House OF Commons
that even if Great Britain received
tha fuu Dawes reparation payments
from, Germany for the next 90 years
she would not receive a sulIlcieh'
amount to cover her payments TO tne
Tinted States, including the payments
made in the past, before anything "as
received from her creditors.
last Summer there was similar
GiUGTenG6 bA GWpOAHto' h@S~
Mellon, replying to a letter sent pS
frederick w. Peabody of Ashburn
ham. Mass, to President Coolidge
afiypcating cancellation of ali wal
debts. remarked that Great Britain
had negotiated a large part or hel
loan from the United States fol
purely commercial, as distinguished
from war, purposes. to meet its com
merciaI obligations maturing
America, to furnish India with silver
to buy food to be resold to its civliial
ponulation and TO maintain exchange.
Loans Are Explained.
sour loans TO England" Mr.. Melioi
added, ''were not so much to provld'
war supplies as to furnish sterllnt
for home and foreign needs and Z
save England from borrowing iron
its own people" This drew an elabo
rate reioinder from the British
treasury.
'Great Britain" the treasury state
ment said provided sterling AM
neutral currencies to meet all her owl
requirements throughout the war an
in addition bore the burden OF cover
ing the sterling requirements OF he
continental allies.
but for the fact that the Unite'
States did not feel able on entering
the war TO relieve her of additiona
burden Great Britain would have bee
able 10 meet, from the resources sh
placed at the disposal Of her allies
her expenditures in America and, i
all human probability the British deb
TO the United States would never hav
been incurred