Evening star., 1931-06-21
WAR ANALOGY seen
!! IN DEBT SITUATION
Description Of Gravity OF
Crisis. However, Is Regard
ed as 0verdraWn.

TnA occasion for President Hoover's
action about Europe is crisis descrlpeo
by q European source, with perhaps
some 6Verernphasis rs mot less thann
the outbreak Tof the Great War. a
member of the French caninet ms, IN
public speech this week said ut Is civili-
zataon itself which is at stake" A Rus
sia-. point of view expressed itself IN
hopeful and gloating newspaper head
line: "Only Revolution Will Cut
the Gordian Knot of the German
Tangle.'' The alarm in France and
England not many days ago about pos
sibie social upheaval and economic
paralysis in Germany was extremely
acute. -.
It may be said at once that the stu
alton President Hoover has eased, while
It has been very serious, hardly JustitleS
the almost hystefical phrases In which
European statesmen described 1t until
President Hoover acted. The present
situation, while. a real crisis, can hardly
be as menacing as in 1922 and 1898,
when Germany actually defaulted on
reparations, French troops entered the
Ruhr, Russian troops were attacking
Poland, italy met theat Of Com
nunistn by adopting Fascisnl, the Ger
man mark was in process OF disap-
pesri:ig and the French franc descend
ing to sn eighth OF its previous value.
That combination of conditions, nine
years or so ago, really 1ustifled the
alarm expressed recently about present
condition, to the effect that COM
munisni might advance until the Rhine
should be its western boundary.
War Analogy Drawn.
As respects diflculty Of prevention
now apparently happily under way
there was real analogy between the
Great War and the present crisis as II
stood last week. The occupant OF one
of the most responsible positions in the
world, when engaged last week In the
process of acting upon the present Sltu-
alton, leaned back in his chair in
moment Of temporary Illustration, ano
said, II know now why the war wasn't
prevented The dif1culties OF achiev-
ing concert of action among consider
eble number Of nations with interests
at once identical but differing are very
great.
The recent menace of European crisis
that came to a climax week ago began
chiefly in Germany more than nlns
months ago. In German election last
october radical groups showed
strength which chilled the country's
entire social structure. Among otnel
consequences, some German business
and financial interests, made humorous
about the political and social order as
we'll as financial security of their coun-
trv4 began to send capital abroad. TINS
early flight of the mark" was happny
arrested by returning sanity about tn;
fundamental orderliness and conserVa-
tion of the German people.
Thereafter, however. few weeks ago
tinnorousness was revived by an event
not in Germany. but in Austria, Where
the principal bank was found to De II
more than a precarious situation: 1nk
| Austrian condition led to a call upor
banks throughout all Europe for 1unas
to support the Austrian economic
! structure
Germany Alarm Grows.
! Alarm about Germany's future wal
Increased, to some extent unJusIlnaplY
bv an accidental juxtapositlon OF evenC
| on June and 7. On June tne hea'
! of the German government, IN an az
/ Jr.sr ~ tI1a German people explaining
fine need for heavier taxation, useS
; some nhrases, which, when translated
! outside Germany, caused more conceL,I
! thaTi either the words or the facts Justl'
! fiad II happened on the following oaS
that the German chancellor called or
the British prime minister. Innh ieo
to a surrnise, inexact IN fact, tnaI Set 4,
MANY had asked for moratorium ~
its payments of reparations. ,.,.
Intorrect interpretations, coupled VIII
the unhappy juxtapcsition OF events, ieo
to the fight of capital from GeInlsas s;I.s
IF a sort that America would deScrlpe
as a run on the German Reicnspann;;
which in a sense is the equlVaient "a
Americas Federal Reserve sysOGzi ~
Some reinsurance was cameo even . -,
fora President Hooyers action, wnen ,c oL
Tussdav of last week, conservaGVs
rolitical interests in Germany persuaded
reejical groups to defer calling any
sneciaI meeting OF the Reichstag untll
the regular meeting in October.
General Collapse Feared.
Fundamentally, the threat OF social
: political and financial collapse In Ger
many, which would be ATTENDED ny 9
einoiiar catastrophe in some otner
countries of central or Eastern Europe,
has been caused by three concitlonns ns
which are if1terlaced and acceierete
each other. Germany cannot unoeE
present conditions make the reparaIloIs
Secondly. Germany suffers more than
nnost countries, and very much more
than America, from the Worldwide de-
T,ression. Finally, Gerrnanys business
Structure has been losing Its life-blood
because of the scared flight OF It's ow?
mark accompanied by reluctance OF
bankers or investors in other countries
to provide Germany with dlStressIuiiy
needed working capital.
That this set of conditions In Ger
many has had seriously harmful et-
fects in every country in the world, In.
Guiding our own, Is clearly proved and
widely understood. It has been said,
whkther accurately or not, that the
principal one present inpediment to. re:
cuperation of business in the United
states has been for some weeks the
menace OF disaster in Germany.