Evening star., 1932-12-18
Two Billion Estimated as Maximum Value
OF Foreign Debts Now Owing U. S.

soned proposal for bringing the debt.
question to final universal settlement
1t is not thought that it would be
dlfflcult to negotiate simultaneously
with our paying debtors, such as Grea,
Britain, and with our defaulting debtors
such as France. The reason is that the
French. for instance. have clearly init
mated their Willingness TO change de-
fault into payment If negotiations
should be offered to them. Some coun-
tries perhaps could not pay without en-
dangering their monetary lives. Greece
is such a country. Poland, possibly, is
another. France and Belgium, how
ever, from the standpoint of their cur
rencies and from the standpoint O!
their gold supplies. are fully able to
that they would quite readily proceed
to pay if only once the prospect of ne
gotlations for new debt arrangements
became assured.
Two ultimate queries then emerge
The first is: How large sum is it
probable that We can extract from cur
debtors in final satisfaction of our
claims?
In answer it may be said that the
most optimistic surmise here enter
talned does not rise above $4,000. .OOO-
900. The present actual capital value
OF the debts is perhaps between So ,OOO,-
100000 and $4,000 900, 600 No banking
firm. however. would purchase them at
that figure. 1t is a statistical account
Ing figure. 1t has to be modified by
the psychological factor of the moral
unWllllngneSS Of most Of our debtors to
complete their payments on the basis of
the existing agreements.
With that factor in mind, there are
bankers who estimate the present value
OF the debts as being not much more
tnan one billion dollars. If our di-
piomacy should succeed in binding our
debtors to positive delivery of two
billion dollars. these bankers would be
very much surprised. A cautious judg-
ment would perhaps be that negotia-
tlonS for revision Of the debts might
terminate with good fortune at the
hgure OF a billion and half.
The second concluding query is this :.
VIII it be possible TO introduce the topic
OF disarmament into debt-revision
treaties?
That it would be advantageous to us
to introduce it has long been main
toiiAcu III IudIl lIlllutDlldl utlerdNCeS
by Mr. S. 0. Levinson Of Chicago, author
of the 'outlawry of war principle en-
bedded in the Kellogg BRAND pact, and
by Senator William E. Borah. Observa-
tlons in a similar tone have recently
been made by Secretary of State Slim
son. The argument is that an arma-
ments reduction sufficiently drastic to
save us s250,000. 600 a year on our ex-
penditures for Army and Navy would
compensate us approximately fully for
the losses imposed upon us by the ulti-
mate cessation of debt payments
It can be safely remarked that haste
will be necessary if We intend really
to try to achieve any Of this sort of
compensation in return for debt con-
cessions on our part. A year ago our
debtors were in better mood toward
bargaining than they are today. With
every passing hour they are less in
clined to introduce the element of COM
pensation to us into a process which
they think is in any case developing
toward an extinguishment of their OBJ
legations to our Treasury. This is an
added reason why it is supposed in
many quarters here that the admins
tration will endeavor to initiate the new
debt negotiations as rapidly as possible
Copyright. 1922