Evening star., 1927-10-23
GERMAN FINANCES
HELD ACUTE ISSUE
Loans and Execution of
Dawes Plan Seen as Cause
of Much Concern.
BY GERVILLE REACHE.

By Radio to The Star.
PARIS, October 22.-Germany's for
eign loans and the carrying out OF
the Dawes plan already have caused
much ink to flow throughout the
world. Shortly these questions will be
come exceedingly acute.
1t is believed here TO be quite pos
sible that they will take prominent
place in American political discus
sion when Congress convenes. since
Senator Carter Glass has declared
that a law should be passed depr1V-
ing the State Department of the
privilege of vetoing private loans to
Europe, and President Coolidge is re-
ported as saying that he would veto
such an act.
Reparations Issue ReOpened.
So far Europe is concerned, this
problem has reopened the whole repa-
rations question which has lain dor.
mant since the Dawes plan was
adopted. The Coolidge administration
opposition to the Prussian loan OF
$50. 900 900 was overcome only by the
insertion of a. clause in the prospectus
invoking article No. 243 of the Ver-
sailles treaty and stipulating priority
for the Dawes payments over those
of the loan. The powers of the Ger
man Foreign Commission also were de-
fined and new system for con-
trolling such loans was instituted,
giving the German finance minister
and the Reichsbahk preponderant
vote.
In the meantime, partisans of Eng.
land are seizing the oportunity to pro-
claim that the Dawes plan Is impos-
sible of execution and even the aus
tere Times mentions the necessity OF
revising the plan and warns against
too great liberality in loans to Ger.
many until the legal Interpretation of
the peace treaty as affected by the
Dawes plan has been settled.
OF course, this British attitude is
warmly welcomed in Germany, where
there is permanent conspiracy
against the Dawes plan. But France
and Belgium are beginning to be.seri-
ously worried by this concealed threat
to another voluntary bankruptcy by
Germany to avoid reparation. Speeches
like that made by Herr Duisberg at
the annual Industrial congress and
the attitude of Minister of Public Eco
nomics Curtius have created a most
unfortunate impression here.
Budget Deficit CITED.
The prospect is still further dark
ened by examination of the German
budget situation. The budget, for the
first four months of the fiscal year,
shows excess receipts of $1S0.000, 900,
yet for the whole year it is said 1t
would show a deficit because of very
obscure reasons, such as failure to
collect certain taxes, enormous re-
funds to states and towns and hold
overs of appropriations from one fiscal
year to the next.
But yet authoritative German econo-
mists have demonstrated that the re.
sources of the reich are sufficient to
meet both reparation and foreign loan
payments on condition that Germany
continue production and export.
Germany's internal and external
debt is only half of what 1t was before
the war. Last March it totaled 23,000,-
100000 marks as against $4,000 ,O00,.
900 marks in 1913, and this reduc.
ton has greatly aided in rebuilding,
saving and regenerating industrial
capital and in meeting public eXpendi-
lures.
One thing is certain, and that is
that the consumption taxes pledges
to execute the Dawes plan during the
three years have been double what
was expected. There is no reason to
believe that Germany cannot meet her
obligations, but it is not too early for
the world to wake up to this ques-
ton.
tCopyright. 1927