Evening star., 1932-12-18
WAR DEBTS SHOWN
WTALT0EvERYBODY
Banks Review Explains How
Present Crisis Affects
Taxpayers in U. S.

What final disposition of the war
debts means to every individual in the
United States is vividly pictured in the
Lincoln National Banks December out
line of business. Many people lightly
hold that the war debts controversy is
between nations and really has little to
do with the individual taxpayer. The
Lincoln Bank presents the matter in a
very different light. saying in part:
War debts constitute one of the fac
tors that determine the wage scale OF
the steel mill worker in Pittsburgh. the
hired man on the wheat farm of Iowa
and the street car conductor in Chicago
The matter is not an academic theorem
of economics nor of high finance.
The income Of every wage Garner,
establishment will be affected by what
ever solution Of the controversy Is
agreed upon regardless of the merit or
business of the settlement.
Debts Vital to Everybody.
These international obligations touch
the lives of all residents of the United
States in multitude Of channels. There
are, however, two main arteries in which
their influence is most direct and most
easily recognized
THE first of these arteries is though
the medium of taxes and government
revenues. The Federal Government
now owes in excess of $21 ,000, 600, 900,
gross of which about one-half was
borrowed to provide funds for the
nations now in its debt. If no prac-
tical method can be found for get
ting back into the United States the
wealth which was transferred to the
debtor nations, then the taxpayers OF
this country must assume the obliga-
ton. The Federal Government must
pay the owners of Liberty and Victory
bonds the money they advanced plus
interest. The Government can obtain
this money only from taxation over
the next half century.
Secondly. no matter what kind OF
debt settlement is finally achieved, the
activity Of all lines of business is GER
tain to be affected in this and in all
other countries. During the last II
months. every wage Garner of the
United States and every business man.
no matter how localized his activities
has been forced to the realization that
shipment Of gold between Europe and
New York have Influenced his sales
and production. Gold exported by a
New York bank had a tendency tc
reduce deposits and contract credit
needed by business men In every section
of the country. The export of $1,000
100000 Of gold from the United States
in the nine months following the aban-
donment of the gold standard by Eng
land helped squeeze the credit of the
manufacturer of Sharon. Pa, the cotton
grower Of South Carolina, the retail
dealer of st. Louis and the exporter
of San Francisco.
when these establishments found the
economic going rough, they were
obliged to curtail employment and re-
duce wages and salaries. The move
ment of gold between this and other
countries is only one of hundred
ways in which the transfer of wealth
through payment of international obli-
cations may mould business activity
for better or worse. No business, nc
wage Garner, no salaried worker is be-
yond the influence of the war debt
controversy.
PRESUMABLY, then. every resident OF
the United States wants to decide fol
himself how the question should be set
tied that adds or subtracts from his
income. and to-v voice his opinion SO that
it can be heard by his representative
at Washington who must Tepreeen1
him In dealing with the matter" the
Lincoln Bank review asserts.
THE sending of the notes implies
that the funding plans for settlement
of the debts have broken down com.
pletely And 1t is assumed that the
debtor nations want the principal OF
the obligations reduced or perhaps can
celed.
"The real question involved in the
controversy, thus Is not whether the
nations concerned can afford to pay the
debts, but rather whether it is phys
ically possible and practical to trans
port the vast amount of wealth in
volved from one country to another
without upsetting the economic bal
ance of the entire world"