Evening star., 1928-12-29
GERMAN RAILROADS
HELD PROSPEROUS
French Economist Cites Con-
dition in Argument of AbiI-
ity to Pay Reparations.

Herald-Tribune. Copyright 1Szo)
PARIS, December 29.-An argument
citing the German railways as a proof
Of Germany's prosperity-and hence
her ability to pay reparations-and
quoting figures indicating that the
Reich's railroads are much less heavily
weighted under reparations bonds than
are either the French or American rail-
ways, was published yesterday In LIE
fies the great bulk of French opinion
1t is. by Jacques Seydoux, noted
French banker and economist, who is
a director of the Banque de Paris ct
deS Pays BaS and a former official of
the French foreign office. The sig
nificanace of M. Seydoux's article lies
in the fact that it strikingly exempli-
fies the great bulk of French opinion
on the eve of the experts assemblage
to finally fix reparations, and it echoes
the belief of many government officials.
Resume Authoritative.
This idea, boiled down, Is that Ger
man prosperity will amply permit her
to continue paying to the Allies rep
arations annuities at the present figure
OF 2,500,000,000 marks (about $685.
O00,00O) and that any reduction what
soever in this amount will be due to
Allied generosity. The Seydoux resume
Is the most authoritative yet presented
In the French press campaign support
ing this thesis.
'"The experts who compiled the
Dawes plan," writes M. Seydoux, "have
set for Germany's payments an index
of prosperity which was to be taken
into account from the year 1929 or
1880. 1t is already probable that this
index will be abandoned during the
coming negotiations, not only the part
paid in reparations, but also the part
allotted to German railways and indus
try will remain stable even If the
financial and economic power Of Ger
many increases"
The banker here refers to the Dawes
plan provision whereby the standard
German annuity may be increased to
more than 2,500,000,000 marks if the
German prosperity index justifies a
larger burden. He voices French rec
ognition of the fact that this further
claim on Germany will in all prob
ability be lost when reparationS are
adjusted by the experts and adds, ''The
further we go the more advantageous
for Germany will be the ratio between
the burden of reparations and the pros
perity of that country, the percentage
Of reparationS annuities getting smaller
every year.
German Report Quoted.
"The report of the Commissioner for
Germany railways, which was recently
published, allows for some interesting
observations" he says. with the Ger
man railways, the service of reparation
bonds has taken the place Of the former
burden of amortization of capital.
For 1928 the service Of reparations
bonds amounted to CSC, 100000 marks
(about $157,O80, ,000), which CORE
spends to 1913 per cent of railway re-
ceipts. In the United States the amor
tization burden for 1926 and 1927 was
IA per cent, in Switzerland % per cent
in France 16 per cent; in fact, the
total French percentage Is 36 per cent.
as the taxes amount to 20 per cent of
the receipts. In the United States the
taxes are 2.5 per cent of the receipts.
while in Germany they were So per
cent last year.
"This means that reparations do not
weigh heavily on the German railways,
and 1t would not be true to say that
their personnel suffers from them. In
the German railway budget, 51.8 per
cent of the total expenditures goes to
the personnel, and 30.7 per cent for the
rolling stock. In the United States this
proportion is respectively As per cent
and 35 per cent, and no one has ever
said that the personnel Of American
railways Is badly paid.
"The service Of reparationS bonds
represents for the German railways in
terest of "a per cent on the total cap
ital, which is evaluated at 24,500, ,000,-
900 marks (about $5,831 900, ,000). In
the United States the interest paid on
capital is APT per cent, or nearly dou-
BILE the German.
Gain Exceeds United States.
According to comparisons made be-
tween German and American railways
by the Commissioner for German Rail
ways the development of German traffic
since 1918 has been much greater than
in the United States. The number of
travellers per kilometer in the United
States has fallen per cent between
1913 and 1927, whereas in Germany it
has increased "a per cent. Merchandise
transports increased per cent in Ger
many and per cent in America.
ITO sum up the situation, we can say
that for 1928 the French railroad re-
ceiptS will amount to $4,000, ,000, 900
francs (about $585, 900, ,000), while in
GeIuldLly tIlcy Will Dc IIlOEe IIldu OyUUU,-
100000 marks (about $780, 0000,000).
Meanwhile the French budget is 45,000,-
100000 francs (about $1,755, ,000, ,000),
not counting the sinking fund budget.
while the total German budget will be
10000, ,000, 900 marks (about $2,380, ,000,-
000). Thus in France the railway re-
ceiptS are one-third of the budget while
in Germany they are one-half.
There Is no better index Of pros
perity for a civilized country than its
railway receiptS" concludes the banker.