Evening star., 1932-10-30
EUROPEANS WATCH
ELECTIONS IN j. S.
Believe Path Will Be Cleared
for Reconsideration of
Debt Question.
BY FREDERIC WILLIAM VILE.

countries which altogether owe us SILL
= 000, ,000,0 900 long ago resigned themselves
% the conviction that until another
President and Congress are elected, the
debts issue would be unbeatable. With
the campaign out of the way, most Eu-
ropean statesmen are persuaded that
the path will be cleared for recon-
sidera--.:.... or the debts. because which
ever party is in power at Washington
will be able to tackle them on their
purely economic merits without the
danger of risk to its political prospects.
Europe has thoroughly understood
that neither President Hoover nor Gov.
Roosevelt, nor either OF the parties.
could afford hitherto to take any atti-
tude that savored of further leniency
to Americas debtors. The temper OF
our people on that score is well known
on the other side.
It is not likely to be long after No
vember 8 before the debts will be in
the forefront of public discussion in
Europe. The French Parliament Is al
subject The chamber of deputies would
have plunged headlong into it ere this,
had not Premier Herriot almost by
main force shelved proceedings until
after election day in the United States.
The French will owe the American
Treasury the tidy sum Of 100000, 600
francs, or $40 ,000 900, on December 10
for interest on their S3865, 100000 debt.
There is a determined element in the
Paris Parliament which opposes the
payment. The French treasury Is
empty. It is confronted by 1888
deficit estimated at $40. 900, 900, besides
a deficit for the current year of sl4o.-
100000. French fnanciers declare that
If the government has to raise half
billion francs to meet the American in
terest annuity, there is no recourse IN
sight except to float new bond issue.
Such action would evoke much resent.
ment in and out of the chamber OF
deputies. If Premier Herriot, whose
parliamentary position is none too Sc
cure, were to seek to force the payment
issue, and attempt to raise the money
either through a BOND issue or new
taxes, it is easily imaginable that MS
government would fall.
Condition Is Cited.
Frenchmen insist there is legal and
logical basis for their refusal to pay
Uncle Sam S20,O00,000 in December. In
the first place, it is claimed that the
Mellon -Berenger settlement. whereby the
Franco-American debt was funded SIX
or seven years ago, was only ratlneo py
the French Parliament on condition
that Germany would continue to pay
reparations to France. This condition
was not formally made part OF the
ratifying action by France, but reso-
luton to that end was concurrently
passed by both the Chamber and the
Senate 1t is regarded as having the
full effect of bargain, even though
'unilateral," i. e., one to which only
France, and not the United States, is
q party.
In the second place, the French feel
that Premier Laval, year ago tnls
month, took away with him from Wash
ington virtual pledge by President
Hoover and Secretary Stimson to pro-
pose to Congress further debt leniency
If Europe showed leniency to Germany.
Meantime, as a result of the Lausanne
conference last Summer, Germany has
received leniency on reparatlonS to the
point of practical cancellation thereof
The clear thinking French are now
saying quite bluntly, that Germany
having been let off, it is up to Uncle
Sam to let Europe off, partially or in
full The famous ''gentlemen's agree
ment" at Lausanne, it will be recalled,
provided that the compact to remit
reparations would have effect only if
Germany's creditors themselves secured
mental obligations. This agreement
was, of course, aimed at the United
States.
British Expected to Pay.
Finally, there enters into the calcu-
lations of France, as we'll as our other
European debtors, the fact that the
Hoover moratorium has in effect been
extended by the Lasanne concessions to
r,l hot lc M
now to be pressed to pay reparations,
her creditors should not be pressed to
pay what they owe. These, at any rate
are the arguments which will shortly be
brought forward in the French Parlia-
ment, and doubtless echoed in the
House of Commons at London, as soon
as the British government divulges its
purpose to meet the 100000, ,000-odd
payment John Hull is required to make
at Washington December Is. So far
the British have not provided for this
sum in their budget. But they have
been accumulating dollar balances at
New York, and the general expectation
in Wall Street and in Treasury quar-
ters at Washington is that Chancellor
of the Exchequer Chamberlain will pay
at the appointed time. The British
next to ourselves. are the worlds prin-
cipal creditor nation. In their own in
terestS, they cannot afford to default
on the American debt. It would set
too dangerous an example for Great
Britain'S debtors.
What either the Republicans or the
Democrats will do after election is
wholly unpredictable. The only hint of
future action thus far has been Presi-
dent Hoover's statement at Des Moines
on October A that he is prepared to
utilize debt payments due from Europe
for the purpose of widening the foreign
market for American agricultural
produce. There ere unconfrmed re-
ports that Mr.. Hoover is also working
on "a bargaining plan" with the
British Empire. The alleged basis of
this plan is the fact that Great Britain
buys big quantities of foodstuffs and
raw materials of which the United
States produces surplus, and in the
sale of which this country has to COM
pete with Canada, Australia and other
British dominions. Mr.. Hoover is said
to hope "to buy preference for Ameri-
can farm goods in the British market
by scaling down the British debt. On
its face, such scheme would be carry
ing out the Des Moines suggestion.
Americas interest in the Ottawa tariff
agreements at one time looked to be
relatively slight. Our trade authori-
ties now recognize the menace to the
United States export business is genu-
Inc and serious.
Reports that Franklin D. Roosevelt,
If elected President. will make pre-
Inauguration trip to Europe has electri-
fled various capitals "over there" The
conclusion to which they have jumped
is that "President-elect" Roosevelt's
principal purpose in seeing Old World
statesmen would be to arrive at some
kind of a new understanding about
debts and also International tariffs.
Copyright. 1922
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