Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-09-16
BY WILLIAM HI. FORT.

NEW YORK, September 16.-The
misconception has arisen that the
newly formed Young plan for repara-
lions payments is rival, so to speak,
Of the Dawes plan, which 1t SupplantS.
In various financial journals have
appeared articles and editorials to this
effect, asking why it was not possible
to revamp the Dawes plan to include
the new provisions embodied in the
Young agreement and allow the exist
ing machinery to continue to function.
Dawes Plan was Temporary.
The idea that the Young plan and
the Dawes plan are rivals, 1t is eX-
planned, is entirely incorrect. The
Dawes plan was only temporary-ad-
mittedly SO. It was designed only to
bridge over q period of time which was
expected to be unsettled: an expedient
intended to operate only until world
conditions became more normal and
. complete and final plan could be per-
fected. Its purpose was to get some
thing started in an abnormal situation.
All that the Dawes plan said, all
1t was intended to say. was: Germany
owes an enormous amount Of money.
Her currency is weak. We must see
what can be done to restore this cur
rency, and stipulate on behalf Of her
creditors what in our opinion is fair
amount for Germany to pay annually
, We will set what we consider fair
amount, and what Germany then does
and how she does it will show us the
extent of her ability to pay and her
willingness to meet her obligation"
Specific Plan Needed.
It was recognized at the time the
Dawes Llan was put into effect that
another and more specific plan would
have to be formulated later. Indeed,
the Dawes plan was put into effect
largely for the purpose OF accommodating
data which, in later years, would be
useful in establishing new plan.
AS a matter of fact, it Is explained,
the Young agreement could not have
been set up five years ago; 1t could
not have been devised without the data a
which the Dawes plan furnished, data
which the reparationS experts used at
the Paris conference as working basis
for the present schedule of payments
) Instead of being a rival plan, the
Young agreement simply completes OPP
erations which the Dawes plan left ur.
/ done. It was not within the scope OF
the Dawes plan to state the total
. amount Of Germany's debts.
!. membered that, until the Dawes plan
went into effect, payments by Germany
were made at the point Of the bayonet,
so to speak, but with the Dawes plan
In operation Germany made her pay
mcnts without compulsion.
Agent General Took Responsibility.
Under the terms of the Dawes plan
Germany was required to deposit her
reparations payment in marks to the
account of the agent-general acting
as q representative of all the creditor
nations. There Germans responsibility
ended. From that point on all reSpon-
sibility was taken by the allies through
the agent-general. Under the present
plan, Germany agrees to assume the full
responsibility of her debts.
Under the Dawes plan the amounts
of the annual payments were fixed,
but there was no limit regarding years.
There was no certain indication OF
what the total of the payments would
be- Therefore at no time could Ger
many calculate with any degree of &C
curacy what her economic status would
be in future years.
In some respects, the terms OF the
Young plan are to Germany'S advan-
tage and in some respects more strin-
gent. In making up the new schedule
the experts adopted the attitude that
Germany's economic position had become
sufficiently established and her sta
bility well enough demonstrated by the
workings Of the Dawes plan to entitle
the Reich to be regarded as a solvent
entity.
Pays in Creditors Coin.
Therefore, under the Young plan,
Germany is required to make her pay
ments, not in marks, but in the cur
rencies of the countries to which she
Is indebted. To offset this, the number
and the amounts of the payments are
fxed and definite and the total payable
annually Is substantially reduced. They