Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-10-17
Way Out Of Franco.U. S.
Debt Tangle Offered
To the Editor Of Tie Star:

To the Editor OF Tie STAR:
Failure to come to terms with France
upon her debt to the United States
| was inevitable. But this writer be-
lieyes we are fully as much to blame as
our former ally. The general public
| has never been taught certain hidden
! financial truths that would explain the
| situation and, moreover, offer an imme-
date solution - as fatuous as this
seems!
Ofiicialdom, for inconceivably petty
reasons, will not voice these truths and
hence they must be broadcast I'M
offlcially.
Our innocent looking grievance
| against France springs from the un-
| pleasant discovery that by giving that
! nation q moratorium we merely trans
| fer her obligation to the shoulders of
| United States taxpayers who would be
overburdened even without French CO.
operation In debt paying. France, on
] the other hand, quite naturally holds
press - that every cent of her debt
| should be acceptilated, because she un-
| doubtedly did the lions share of fight
ing in quarrel that was ours as well
| as hers.
Both countries are right, and yet
both are wrong, or rather remiss in
overlooking a perfect answer to the
| dilemma.
The real criminal in this interna-
tional misunderstanding (Which should
be nipped in the bud ere 1t grow into
bellicose condition. is the coupon on
! the war bondl Once this Is admitted
| 1t becomes evident we have available
simple, absolutely just and harmless
| way out of the Internal n1uddle. To
| see and apply the right financial medi-
cine takes ordinary brains rather than
| any particular courage.
American citizens pay over billion
| dollars q year to Liberty and Victory
ondholders-many Of them absentee
| investors. When 1t is considered that
not q penny of this gravy is earned
money, why does our wise Federal ad-
| miniStration remain silent as the grave
upon tho splendid plan of bond moneti-
ration by which all future coupon privi-
| leges would be annulled and all war
bonds made full legal tender at par?
This would be sound and ethical
| finance, since these bonds were issued
| for cash gold money! and are, there
fore. worth their face as debt-paying de-
vices. Such bond money would operate
perfectly as a medium Of exchange in
| disproof OF the moss-grown fallactes
always cited to uphold the notion that
only gold and gold certificates are
| really good" money.
vantages Of this expedient! Our ma
| tional income taxes would drop prac-
tically to zero. The stupendous saving
thus made to industry would enable
the United States to grant at least q
99-year moratorium to France and
other European nations. Once again
we would have the respect and even
love Of Germany, England, Austria and
France.
But this is by no means all Many
billions Of new legal tender would OPP
crate like the gentle rain on the
parched earth"-like oil for our rapidly
increasing hot boxes! Bond owners
would be obliged to invest their bond
money In productive enterprises instead
of going to seed by accepting interest
income that costs no effort of mind or
body, and would even find themselves
better of than before! The common
people, of course, would profit immense
" by being able TO keep In their pos
session not only the sum they are
gouged out of as ultimate consumers,
but also numerous other levies incl
dental to the present impractical and
absurd gold regime.
Mr.. winston, former undersecretary
to Mr.. Mellon, 1t Is true, in privately
passing on the bond monetization idea
claimed that 1t would result in "unprec-
edented imitation" But let US be SEN
meaningless word Imitation" the cor
rect, scientific word expansion" and
then you can take Mr.. WinSton's word
for It!
The answer Is that bond monetiza-
ton means prosperity and Joy for all
and nothing else butt" And why not2
r. GIAICH.