Evening star., 1932-08-07
ANGLO-DUTCH ENTENTE
REPORTED TAKING SHAPE
Possibilities of Holland Joining Enc gland
in Abandoning Gold and Receiving
Far East Protection Seen.

! over a very long line and old traditions
might in the abstract recommend an
entente with the Eastern neighbor. But
Germany has not yet overcome the con-
sequences of the World War. True, her
her commercial navy is practically back
| to a pre-war standard, and up to the
| beginning of the world economic crisis
! she had shown symptoms of a steady
and comparatively rapid recovery How
ever the depression affected her,
| country Just recuperating from terrible
| illness and by no means back to her
former strength. more severely and
dangerously than other countries
which could fall back on savings and
accumulated reserves. Her navy for
the time being is insignificant as COM
pared with the navies of great powers,
and the long accumulations of hu-
initiation and poverty have created a
state of unrest which frightens the
cautious and conservative Dutchman.
Sympathies With England.
There are important sympathies-
there always have been-with England.
That country, which emerged victorious
from the World War and which has
been uniformly successful for over two
centuries. showed considerable strength
and flexibility when the world crisis
forced her to leave the gold standard
and give up long commercial tradi-
tion.
England would certainly be in posi-
ton to render great services to Holland
in her colonial empire. Her navy is still
actually the most powerful in the world
The day Is not far off when it will be
outbuilt by the United States, but for
some time to come it still enjoys the
supremacy of the seas.
The English were among the first to
see that Japan was a rapidly rising
power; they lent the Japanese Empire
a helping hand. helped her develop her
naval power and used the Japanese al
lance to deal a stunning blow to Rus
sia without firing single cartridge
themselves. The desire to avoid all pos
sible friction with the United States
the first and paramount rule Of British
diplomacy of today-necessitated ces-
Sation of the alliance between the two
island empires. but close entente re-
manned.
Any real danger to Hollands colonial
empire could come only from Japan.
Since their country was industralized
the Japanese have proved the keenest
competitors in the field. They are still
in stage Of transition, where capital
can exploit, at prices which exclude
European competition, the skill of able
workmen who still have an incredibly
low standard of life. This japanese
competition has become all the more
menacing since the yen went off the
gold basis. for it is one Of the common
truths that for period inflated cur
rencies act as a powerful stinulant to
exports.
Japanese industrial competition hits
equally hard all those who trade In the
Far East What is more feared by EIo1-
Important 10 England.
For England itself the question Of an
understanding with the Dutch is more
important than it might seem at first
glance. There Is no doubt that a
f1uctuating pound is a serious handicap
for the banking business in England.
Holland, being firmly established on
gold basis, has of late seen her banking
business increase, even in these times
of general depression, and not much
Imagination is needed to foresee that
with England On an unstable currency
basis Holland could manage to get
certain amount of banking business
which under normal conditions would
DG dIlSdCISQ 4OllOOll All OkJAllOIlo
seem to concur that speedy return of
not probable She has, therefore,
natural interest in seeing as many
other countries as possible go of.
For Holland it would be a great and
decisive step to abandon the gold
standard, and certainly there Is re-
iuctance among the extremely con-
servative Dutch banks to do anything
so risky. At the same time, the Idea
must seem tempting, particularly in
order to face the crushing japanese
competition in the colonies.
America has definitely assumed the
role of the paramount power in the
Pacific Ocean. 1t is a great and deci-
sive step in her history, though 1t has
hardly been noticed by the mass Of
! her contemporaries. But with Amerl-
| conspicuously made the center OF tthe
United States foreign policy, the Dutch
| colonies coming within the English
| sphere of interest would be a most
! important factor. A look at the map
is SUFFICIENT to show how clearly such
a change might affect the American
| interest in the Philippines and in the
Far East generally.
America, being an adherent OF the
gold standard and not likely to De
forced to leave it, could not view with
pleasure another important area on
! the gold standard. Numerous attempts
have been made-Mr. Winston Church-
hill being certainly the most or1liiant
Of those who have tried-to induce
America to abandon the gold standard
Then france would be practically com,
pletely isolated as a gold country, and
the value of gold, for so long the
measure of all other values, would De pc
likely to become unstable Win Uhe
| rapidly diminishing demand. AN, -
All these developments are still II
q tentative state. But American III
terests are largely involved, and as
nile it is more interesting to STUD!
questions while they are still in tnf
bud rather than to be faced by accom-,
plished facts when it is too late u
mend them.