Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-09-21
BY FRANK H. sIMoNps.

w WHILE it is not difficult to un-
~ derStand the irritation pro-
NV voked in administration cir
cles by the declaration of a
Democratic Senator return
ing from his European travels that he
has detected signs abroad Of a purpose
to raise anew the question of allied
debt payments, the surprise manifested
in and about official circles is a bit
more difficult to explain.
AS to the irritation, 1t is clear that
It proceeds, in part at least, from the
fact that any debt discussion is mop
perfume at the precise moment when
the single possibility Of avoiding an in
crease in income tax rates lies in the
utilization of debt payments to meet
current expenditures. Hitherto these
payments have been applied to the eX-
tinction of national debt along with
the annual SURPRISES of revenues over
expenditures. Default or reputation
by our European debtors would then
automatically increase domestic bur-
dens.
AS to the surprise, however, 1t must
be ascribed to an all-too-ready accept
ance of the notion that the making
and signing of debt settlements auto
nlatically insured payment. BY con-
trast, nothing has been palmer than the
fact that the debt settlements them
selves represented q gamble upon the
prompt and complete recovery of Eu-
rope from the economical and finaT1-
cial losses of the World War
United States View Not Accepted.
The American view that the war
debts we're on the same footing as or
binary commercial obligations has
never found European acceptance. On
the other hand, for a variety of rea-
sons the various European countries
have found it ineXpedient or imprac-
tical to repudiate the obligations out
right.
They have. however, on frequent oc-
caSions disclosed the conviction that
these claims were without moral war
rant, and with even more frequent
statement have revealed their convic-
ton that payment was not possible. We
on our side have chung to the double
conviction that Europe was morally
bound and materially certain to be able
to pay. 49,.
American view has been found in the
rapid recovery which followed the
prostration of the war and immediate
postwar years. Between 1924 and
1929 the upSwing has been general and
nowhere more striking than in France
and Germany. If In Britain progress
has been lacking the Dawes and Young
plans have both assured to Britain
German contributions which. together
with debt payments by allies, suff1ced
to meet American obligations without
any direct call upon the British treas
ury.
For a year now, however, German
economic conditions-and. indeed, gem
eral continental conditions outside of
France-have suffered from the world
depression, which has been unpleas-
antly felt on our side Of the Atlantic.
In a Germany with more than $780,
900 unemployed, capacity to pay has
again become both political and a
practical question.
Grave Issue Raised.
But for Britain, suffering even more
acutely than Germany and with a
higher and more constant rate of
unemployment, the possibility of Ger
man default in reparations has raised
a very grave issue. The issue is the
graver since France and Italy have
clearly indicated both to Washington
and London that their debt payments
are contingent upon German repara-
tions receipts.
Were Germany, in evident good faith.
compelled to reduce or suspend her
reparations payments, automatically
tnterrupting French and Italian debt