Evening star., 1932-12-11

necessary, but more or less inevitable
without such plans a further mora
torium may further destroy the edifice
of credit; with such plans it becomes the
first essential step in the recovery OF
credit But the plans must cover more
than the war debt settlement itself; for
if they are limited to that, the settle
ment, whatever it may be, will not be In
the interest of either America or Europe.
It would leave America embittered In
the same way in which Germany was
embittered over the question OF repara-
tions, and the European debtors faced
with the economic consequences OF in
creased suspicion concerning all inter
national obligations and increased ten
dency toward that fatal trend OF eco
non1ic as well as political nationaiism
which today threatens to paralyze the
whole world of trade. The final solution
for the war debt controversy lies out
side the controversy of debt payments,
for it can never be found inside it.
THIS does not mean widening the war
debt controversy merely to include
the similar problems of reparations. The
United States has already pronounced
itself on that program. Rightly or
wrongly, there is no possibility in the
field of American politics for linking
these two issues in a single debate with
America It is only natural that France
should not understand this point, for the
question of reparationS is and has been
a vital one for it's recovery from the in
vasion of it's territory. But nothing has
more surprised American public opinion
than to read the utterances of British
statesmen in this regard-even liberal
statesmen representing the most en-
lightened public opinion of the most
realistic country in the world.
When a man like ViScount Snowden
still links the cancellation of war debts
with that of reparations in the state
ment of the problem to be negotiated
with America today, one wonders how
long it will be before European opinion
as a whole will be informed on the fun
damentals of the American situation
The former chancellor of the exchequer
is as mistaken in his Interpretation of
the American outlook today as he is of
the history of the debt problem itself.
The history is beyond dispute; the debts
were accepted by America without
thought that they would be paid out of
anything resembling a tribute of the
conquered.
This was not out of any desire to
spare Germany or take advantage of
the allies 1t was one of the funda-
mental principles upon which the
United States went to war that it was
not under any circumstances to make
profit out of that tragic enterprise. The
refusal to take any share in reparations
was part and parcel of the way of
thinking which led the United States to
refuse territorial aggrandizement. 80
In the postwar years this way of
thinking has not changed; indeed, it has
been strengthened by the success of
German propaganda in the war guilt
controversy, which has been a political
fact more important than has yet been
recognized in its effect ON the war debt
controversy. The United States is less
minded now than ever before to link the
debts of the allies with their claims
upon the defeated enemy.
There is only one way in which the
reparations payments have been brought
by America into the debt settlement
problem, and that is by the use of the
formula capacity to pay" If the Euro
pean debtors were to state that they
have no other resources with which to
repay the debts than German repara-
tions payments TO them; that would
affect their payments to the United
States, because their capacity to pay