Evening star., 1928-03-04
GERMANY is OVERCOMING
HER INTERNAL PROBLEMS
Nation, Still Left With Unfavorable Trade
Balance, Has Made Big Strides
Toward Stability.

Germany was largely ez,inguished By
the war and imitation. But the boy-
rowing has not been on the whole
regulated Much money has been ap-
piled to industrial undertakings much
has been employed by the cities and
communes to build new buildings. to
make parks, to crafty the desires OF
the inhabitants.
This municipal expenditure has
greatly stimulated industry. the build
ing has produced a boom in iron and
steel Employment has gone UP rap
idly-indeed one Justification for the
municipal expenditure was the nccd
to supply employment. But as employ
mcnt has increased, wages have In
creased. AS wages have increased con-
sumption has increased, but from the
practical point Of view, costs OF Dgo-
duction also have increased. Germany.
then. has seen rise of prices. infinite
ly pleasing for the moment at home.
but manifestly handicapping German
exports
This domestic boom is slackening be-
cause the domestic market has
reached the point of saturation. Along
with this has come the rapid contrac-
ton of the volume Of borrowing. par
ticularly on the part Of the munich
oalities by reason OF the protest Of
S. Parker Gilbert. agent general Of
reparatlons payments What Is dis
turbing is that foreign exports have
no more than kept pace with the ex-
pansion OF imports. Last year Ger
man trade had an unfavorable bal
ance Of 81 900 900 900 Thus GERMANY
financed domestic boom on borrowed
risen FOR several years. but the gain
has been Offset by the expansion Of
imports.
Hit by Crop Failure.
One must say in all fairness that
one of the causes of the expansion
Of imports has been the failure Of tao
out Of three Of the last crops. A good
harvest would undoubtedly insure a
very considerable construction Of i'm
ports. since foodstuffs count very large
~ in the total
Fundamentally. the German eco
nomic situation is sound. Government
finance is sound. The strength Of the
rentenmark is unshaken. The foreign
debt is relatively inconsiderable. less
than $4,000. 100000 In the aggregate.
II one compares the experience OF
France with that of Germany the sit
uation Is clarified France has prac-
tically stabilized her franc. balanced
her budget. increased her exports until
they are in excess of her imports
very greatly In excess If one reckors
the profits OF tourist trade and other
invisible items" lacking in the German
case. While France has a considerable
foreign debt. she receives annually on
account of reparations more than she
pays 10 the United States and Great
Britain. and her claim against Ger
many will doubtless always exceed the
claims upon her Of her American and
British associates of the war.
| France has accomplished this with
! out foreign borrowings. Her economic
rehabilitation has been self-contained.
And it is the judgmen. of sober ohserv-
erS that within year or two France
will resume her old practice Of lending
rleted the task Of restoring her Own
capital Germany on the other hand.
has stabilized her currency only by
foreign loans. restored her industrial
| machine By the same method. She IS
bound by reparations agreements OF the
Dawes plan to pay s625. 600 900 annual
" after the current year, and. as have
said. the gap between export and I'M
port Is enormous
HarneSsed to Business.
German craftsmanship. too. Is har-
messed 70 German business. The most
considerable task Of the foreign ONCE
IS 10 make commercial treaties which
will reopen world markets 20 German
production. More than any other con-
t1nental country. Germany is pract!c-
ing economic politics internationally.
Even with Poland with whom her
Quarrels are greatest and most eroit-
tering. the German government Is now
negotiating q commercial agreement III
the teeth OF Nationalist recriminatloa,
Given the problems which exist
nothing is less likely than that Ger
many will suddenly. fully equipped
economically irresistible Jump forth -
conquer the world markets. II IS not
true that this has already happened
II the worst Is over, II the greatest oo-
StacleS have been SurulN,rted. it still
remains trle that Germany has lcns
period of years Of hard work before her.
Of relative poverty. Of effort more SuS-
tanned and more exscting than tina,
which Is imposed upon the British or
French people. much less the American.
for Germany has Still 20 recover her
capital and thus her economic tn6s-
pendcnce and ultimate nncnic sound
ness.
lCnrvYish. 1881
So