Evening star., 1927-11-20

| and Germany face financial
| l. crisis involving both America
| and Britain?
If the German situation is given
hvor, the franc will collapse. II
France is favored, then it will be the
mark that collapses. Here is the situ-
alton upon which the peace and secur-
ity of western Europe depend:
| The French enthusiasm for Locarn0
| il cooling era adually, and on top of
| that most Frenchmen are suddenly
apprehensive of the Dawes plan. as a
result of Parker Gilbert's warning CT
| danger.
| With the collapse of Germany fol-
lowing imitation. all French hope Of
obtaining directly the money to restore
| the devastated area finally went out.
All that remained was the promise,
which the Dawes plan later supplied.
that from Germany would come an
nual payments sufficient to carry and
in part extinguish the loans which
had been obtained from the French
people for this reconstruction work.
Sums Are Small
| For the first three years of the
! Dawes payments, the sums actually
| turned over to France have been re1a-
| lively small. The current year is the
first in which they become consider
able; next year they reach the fixed
| maximum. This year, France will
| have as her share of total payments
something over 100000, 900. Next
year she will receive 81 per cent of
1926, 5,000. 600. and henceforth this total
continues.
When one considers that despite inn
position of enormous new taxes. the
French budget has only just been
brought to balance, and that without
inclusion of the German contribution
of 5000 200, 900 in the current year
there would be a large deficit. the im-
plication is clear. A collapse of Dawes
plan payments almost would ineyi
tably involve a new deficit in French
revenues. For long time the Ger.
man contribution will be the single in
surance of budget balance.
Looking at the German situation
from the French angle, what does il
seem to be? The French are con
fronted constantly by the demand Of
the majority of the German people
that the Dawes payments be reduced
To the French there is every appear
lance that the Germans are seeking, BY
raising the question of war guilt, t.
destroy the moral grounds for th'
Dawes plan and to establish the ides
Of physical inability to comply will
the schedule of payments.
Naturally, the French view with in
creasing alarm the German campaign
to obtain foreign loans, chiefly il
America. In less than four years
loans, raised abroad approximate
So, SOC. 900 900, a sum about equal to tn
French debt to the United States ant
more than half as large as the British
war debt to us. Moreover, no presen
limit is discoverable to the extension
of this borrowing.
Escapes the Burden.
Next year and in all successive
years Germany, under the Dave
plan. will have to find directly $625,
000, 900 for Dawes payments. In addi
ton, she will have to find at leas
$3.50, ,000,00 for interest on her foreign
borrowings. So far Germany has Dor
rOwed abroad more than she has pai(
in reparations, and as yet the burdei
has not fallen upon her shoulders.
| Sooner or later, the German people
will have to pay. When that time
comes, payments can only be made
as Germany sells abroad more thar
she buys. And despite the marked
recovery in German industry, she ha:
| 81 4dk IdiiCu " dCtLicNS SNcIt o. SIIldl
favorable balance in her foreign trade
The French have been followins
with anxiety the rapid growth in Ger
man governmental expenses, which
has now been emphasized by Gilbert
In four years the German budget has
been expanded by upward of $3.50,
900. 900.
Were this process to be continued
next year. when the Dawes plan pay
ments touch $625. 1000 900, the German
budget might be out of balance, which
would directly affect the sums avail
able for reparations. Thus the Ger
mans would, in the first year wher
reparations reach the normal figure
necessarily come forward with the de
mand for the revision Of the whole
Dawes plan.
Rivalry on Payments.
In addition. there would be a rivalr,
between the payments for the Dave:
plan and the payments due upon for