Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-05
NEED FOR LATIN AMERICAN
RELIEF FROM DEBTS SEEN
Plan Similar TO Moratorium for Germany
Suggested-CommOdity Price Drops
Increase Obligations.

consumption OF American manufactured
goods. 1t might be added that it will
not be long before the word "prospec-
tive" may be scratched from this SEN
tence.
Economic conditions in Latin America
have tremendous bearing on the
United States. Of course, the amount
OF money involved in the European
debts resulting from the war is consid-
erably larger than that Of the Latin
American obligations, but in the end,
taking into consideration American
capital invested in the 20 Latin Ameri-
, can republics, American foreign trade
in that part of the world, and all the
economic factors which enter into the
life OF nations, the United States, 1t is
argued by proponents of the financial
aid plan, ought to be more concerned
with the situation in the rest Of the
Western Hemisphere than with that on
the other side Of the Acantic.
Why Not Help Customers:
Besides, from a purely materialistic
point of view, another question could
be raised in this respect: If the United
States gives a hand to Germany, Italy.
France, Great Britain-which are her
competitors in world trade and in the
conquest of precisely that same Latin
American market-why should not she
help the Latin American nations, which
are not her competitors but her GUS
toners and friends?
Finally, there is still another consid-
Grafton which the statesmen and the
financial leaders concerned with this
crisis always have in mind. The Latin
American countries are the victims Of
a situation for which they cannot be
made responsible. They cannot be
blamed for it.
The main cause Of their economic
troubles is to be found in the enormous
decline in the price Of commodities and
raw materials on which their whole eco
nomic life was conferred With only a
few exceptions, the Latin American
countries depend entirely on one or two
single products. Therefore, the extraor-
binary fall in prices which followed the
stock market crash. intensified by the
evils of overproduction, has upset the
economic structure Of nearly every one
of them by cutting to half, or third,
the price of the particular commodity
which constituted the bulk of its ex-
ports.
Coffee Drop Hit Seven.
A few brief figures will help to illus
trate the situation. Prices on coffee,
dropping from $3.50 to $50 a hundred
pounds from January, 1929. to January,
1881, have affected Brazil, Colombia,
Nicaragua, Costa Rica, Venezuela, Qua
temala and Haiti. some of these coun-
tries being dependent almost exclusively
on their coffee exports. Sharp declines
in sugar prices, averaging 70 cents a
hundred pounds over the two-year
period, have been felt in Cuba, the Do
minican Republic, Brazil, Colombia and
Peru. Chile, Mexico and Peru have
suffered drop in copper prices which
amounts to $6.l2 a hundred pounds.
The decline in the price of tin. amount
ing to 40 per cent has injured particu-
larly Bolivia, where 81 per cent of all
exports Is tin. Even more pointed de-
clines have been registered in wheat
and corn. prices for which have been
reduced in the two-year period by 81
and SO cents per busheI, respectively.
This decline, while primarily affect
ing Argentina, also is reflected in con-
dltions in Chile, Brazil, Colombia, Mex
leo and Peru. And so on.
These figures show that the blame
OF the crisis cannot be laid upon the
governments of those countries De-
pending largely on their exports to
cover their expenditures and meet their
foreign obligations, they have been
forced, by this uncomfortable decline in
values. to cut down their budgets to a
minimum. to create new taxes, to COM
promise their credit and to face the
worst general economic depression they
have seen in years. Peru, Bolivia and
the Brazilian State of Santa Catalina
nave already requested that payments
on their foreign debts be suspended
temporarily or considerably lowered
Debts Are Doubled.
In other words. the Latin American
governments have seen their foreign
debts suddenly doubled or tripled as a
result Of this decline in the price OF
their major exporting products. For
they are compelled today to sell two
or three times as much of those prod
ucts-to get the money required to
liquidate their foreign obligations-ss
they did only two years ago And, still
the worst of it. they cannot sell that
much because there is no demand that
large.
1t is obvious that the governments
themselves cannot be blamed for a
crisis of this kind. Truly, governmental
inefficiency and eXtravagances have
added to the seriousness of the situa-
ton in certain specific cases, but in the
main it is evident that the Latin Amer
lean countries are the victims of an
economic phenomenon beyond their
control and for which they cannot be
held responsible.
(Conyrieht. 1QS1)