Evening star. [volume] (Washington, D.C.) 1854-1972, 1932-03-20

rate Of interest, which In every case
was considered more burdensome than
the repayment of the principal. ConSe-
quently Italy was exempt from paying
any interest for the first five years and
for the following years up to 1887
the rate of interest was to increase
every 10 years from 0.8 per cent to /
per cent during the years ls67-ls77
and 2 per cent during the years 1871
1887.
Original Loan S1,64S,100,0 900.
Italy's Indebtedness at the time when
the agreement was reached was $2,042,-
900 900. The original sum borrowed from
America was 81 ,648, 100 900, but the in
terest which she had not paid since the
time of borrowing increased the in
debtedness to over $4,000, 100000. Up
to date she has refunded $1,000, 900.
The total amount of interest she owes
is only $685., 200, 900. and her entire in
debtedness principal and INTEREST,"
amounts to $3.50, 900, 900. which she is
supposed to refund at the rate Of $685.
700 900 year.
The other nations which have bor-
rowed from the United States are Bel
GUM, CZechoSlovakia, ESthonia, Fin
land, Greece, Hungary, Latvia, Lithu-
ania, Rumania and JugoSlavia. Their
total original indebtedness was SITS
500, 900: at the time Of the debt-fund-
ing agreements they made with this
country their Indebtedness had risen to
$685. 100000. The rate of interest
charged them was purely nominal, and
their indebtedness today. representing
the principal borrowed and the interest
thereon, represents $1,712, 100000, Of
which they have refunded up to the
present $4,000 900. This sum is sup
posed to be refunded by 1887 in yearly
installments from as high as 2,100, 900
for Belgium to as little as 100000 for
Rumania.
Feels Terms Are Liberal.
The administration feels the settle
ment is generous on the whole because
most Of the European nations, with the
possible exception of Great Britain, pay
a much lower rate of interest than the
people of this country are paying for
the war loans. The American taxpayer
is compelled to pay an average of 4 per
cent on money borrowed for war pur-
poses and for sums advanced to its war
associates, while the highest rate Of IN
terest charged the European nations is
81 per cent to Great Britain and as
little as 0.8 per cent to most Of the
other debtors.
The debtor nations look upon, the
situation, however, from different an
gle They maintain that while the total
amount borrowed from the United
States IS only 0,109, 900, 900 the inter-
est they must pay the United States Is
SIC, 621 200 900, which they find today
as too burdensome. Great Britain Dor
rowed originally a little over $4,000
100000. She paid back close to $1,000
100000, while a debt of close to $10,-
600, 1000, 900 remains. France feels she
is in the same position. She borrowed
originally about $4,000, 000, 900, repaid
almost $500, 000, 900, and still owes US q
little over $4,000, 900, 900.
Confronted with these figures, It ap-
pears likely that the debtor nations
would feel inclined to avoid further
payments of this huge debt as soon as
they can find some excuse to do so.
The reading of the above figures
might induce many to think the Euro
pean powers have legitimate case to
ask the American Government for q
debt revision. but so far the payment
of the debts has brought no particular
hardship on any debtor nation. Great
Britain is paying us exactly the same
amount she receives from her European
creditors; France is paying us less than
she gets from Germany and the other
nations are in a similar position.