Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-08
PRESIDENT GIVES
DEBT WARNING TO
TRADE CONFERENCE

Continued From First Page)
by repeating a statement which I made
| to this conference just four years ago.
when we were in the heyday of for
| eign loans. I stated, in respect to such
| loans. that they are helpful in world
! development, provided always one es-
( sential principle dominates the char
| acter of these transactions. That Is.
/ that no nation as a government should
| borrow or no government lend and
| nations should discourage their citizAnS
| from borrowing or lending unless this
money is to be devoted to productive
| enterprise.
Out of the wealth and the higher
standards of living created from en-
terprise itself must come the ability TO
| repay the capital TO the borrowing
| country. Any other course of action
| creates obligations impossible of repay
ment except by a direct subtra ction
| from the standards of living of the
| borrowing country and the impover
ishment of its people.
Blessings Would Follow"
In fact, If this principle could be
adopted between nations of the world
that is, If nations would do away
| with the lending of money for the
| balancing of budgets, for purposes Of
| military equipment or war purposes, or
even that type of public works which
| does not bring some direct or indirect
productive return-a great number of
| blessings would follow to the entire
| world.
There could be no question as to
| the ability to repay; with this increas-
ing security capital would become
4 steadily cheaper, the dangers to ma
| tionai and individual independence in
| attempts of the lender TO collect his
| defaulted debts would be avoided: there
nould be definite increase in the
standard of living and the comfort and
prosperity of the borrower
| There could be no greater step taken
in the prevention of war itself This
| is perhaps little further toward the
millennium than our practical world
has reached, and do not propose that
these are matters that can be regulat-
| ed by law or treaty. They are matters
| that can be regulated solely by, the
| commercial and financial sentiment of
| each of our countries: and if this body
may be able to develop the firm con-
viction, develop the understanding that
! the financial transactions between ma
| tions must be built upon the primary
foundation that money transferred is
| for reproductive purposes. it will have
| contributed to the future of the West
ern Hemisphere in degree seldom
! open TO a conference of this char
acter.
Would Have Cut Burdens.
repeat this today because had it
| been followed during nese past five
years our problems throughout the
world would be far different, our diff
ficulties infinitely less.
1 have learned with particular in
! terest and qualification that by far the
! greater number of those in attendance
| tai delegates, but representatives of
the commercial and financial establish
mentS of the several American Re-
publics. Particularly do we in the Unit
| ed States hold to the theory that COM
mercial enterprise, except as rare
emergency action, is essentially a pri-
waite undertaking. and that the sole
function OF government is to bring
about condition of affairs favorable
! to the beneficial development of private
| enterprise. 1t is the failure to compre-
bend this conception of the relation
between the function Of Government
and the function of private enterprise
that sometimes leads the thoughtless to
assume the CIatence of an interna-
tional indifference which does not in
| fact exist.
The larger significance of your meet
! ing is attested by the fact that at
stated intervals the accredited repre-
! Sentatives of the Governments and of
| the commercial organizations of this
continent come together with view
to interchange Of experience and fos-
tering that mutual confidence without
which the development of international
commerce is impossible. Your work
possesses a significance far beyond the
concrete nrODlPnS with whirh yOJi will
have to deal
Permit me IN closing to combine with
my welcome the confident expectation
that your deliberations will rebound to
the benefit of all the Nations Of this
continent