The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1932-01-27
Dollar Diplomacy
(New York World-Tclegram

With commendable persistence the
senate finance committee Is sticking
to the johnson investigation Of for
eign loans and concessions, despite
efforts Of the state department to
block the inquiry.
There will be many foreign loans
and concessions in the future. with
the state department playing a part
in such deals. II the cause and ma
ture of past abuses can be uncovered
it will help in working out more
effective system OF governmental re-
lationship to such semi-diplomatic
commerce and finance.
We do not profess to know what
the exact relationship Of the govern
ment should be to foreign loars
That will have to be worked out by
experience. We agree with the grow
ing public opinion that the unauthor-
lied power usurped by the state de-
partment in passing upon private
foreign loans has had vicious results
But We cannot agree with some
critics. such as Senator Glass. that
the solution Is no governmental reg
ulation.
The familiar assertion that there
should be no connection between a
private foreign loan and government
policy may be very pretty in theory.
But 1t Is q complete denial of the
facts OF experience. not only of the
United States but Of every other
creditor nation.
Even though it is not necessary to
restrict foreign loans almost exclu-
sively to diplomatic purposes, as in
France, or to follow the old British
practice Of ear-marking foreign cred
its for special trade advantages or
imperial favors, some connection Is
inevitable.
For instance, II New York bankers
float a loan for Japan's South Man.
churian railway-as often proposed
it might make thousands Of American
citizens In effect partners in Japan's
conquest Of Manchuria, and it would
certainly influence American diplo-
matte and naval policy.
Similarly, as long as the Caribbean
Is considered an American lake" es-
sential to the security of the Panama
Canal 1t is futile to talk about the
Washington governments keeping its
nose out Of Colombian or Nicara-
guam or other Central American pri
vate loans and concessions.
Interests of private American CAPT.
tai In Mexico, Cuba and other coun-
tries are often the key to state de-
partment and navy department po-
licies.
Concessions and loans can be the
cause Of war, just as they are so often
the cause Of military intervention.
Therefore the American people
have right to expect their govern
ment to protect their interests-and
the larger interests of the country
when jeopardized by he avarice. cor
ruption or folly Of private American
concerns abroad.
Obviously this necessary protection
Of the national interest is possible
only when our government is fully
informed Of al such transactions. as
the state department has insisted
upon being informed.
The fault has not been that the
government was keeping its eye and
hand on such vital deals, but that the
state department has been neither
wise nor open In this work.
Such powers are too great, both
for good and for evil, to entrust to
the state department or anv
bureau or commission without the
customary popular checks and ball
ances which characterize or should
characterize-the American system OF
government. Those checks and ball
ances on dollar diplomacy are now
lacking.