The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1932-11-28
Member of Audit Bureau Of
Circulation
France and the War Debts

France and the War Debts
France can pay the present in
stallment on her debt to the United
States If she wishes to do so--and in
gold. She has the money. Her vaults
are crammed with it.
On october % France had in her
gold reserve $4,000 10000 francs or
more than $l6,O0O,OOO,OOO more than
all the rest of Europe combined and
more, on q per capita basis, than the
United States, although the total of
gold held in this country is larger.
Why, then, does France wish to
default? With the money to pay
her just debts, why doesn't she do
so?
The answer may be found in the
French internal situation. The ma
ton is struggling desperately to
maintain dominance in Europe and
that stock of gold is one of her prin-
cipal assets in this effort. She feels
she must keep it at all costs.
Frances unemployment situation
is better than that of most coun-
tries. On October 90 only 247 1892
were registered as wholly unemploy-
ed and receiving government aid.
Total unemployment is estimated at
100000, a relatively small amount on
a per capita basis.
But the French have built up in
the national consciousness a belief
that heavy ornaments must be
maintained at all costs; she faces a
daily increase in unfavorable bal
ances between imports and exports
she has a budget deficit of more
than 12,0OO,OOO,OOO francs and this,
plus the deficit in the state-owned
railway system, will make it neces-
sary for her to float loan of from
20 to Is billion francs. In addition,
her circulation of paper money
steadily is rising and prices are
climbing along with it. The nation
now has 2,203 100000 francs of notes
in circulation. Her currency is back
ed by far less gold than that of the
United States. Her large gold re-
serve is not helping her to meet her
internal financial difficulties any
more than our gold reserve is help
ing to balance the United States bud
get.
The French are a peculiar people
and indications are that they are
boarding gold. 1t is an ancient GUS
tom with them and one readily re-
sorted to in times of stress. Pay
ment in gold to the United States
therefore, might be the thing which
would start in motion the process OF
taking France off the gold standard
AS result, France will weigh the
advantages of refusal to pay against
the disadvantages and chart her
course accordingly. That the debt
is an honorable one and that the ma
ton can pay is not the deciding fac
tor as it has been and is in the case
of Great Britain. The character and
temper Of the two people differ
They maintain different attitude
toward their obligations.
From the standpoint OF internal
politics it would be easy for France
to default. Her orators would drag
out the Uncle Shylock' myth and
concentrate the national hatred up
on the United States in order to in
flame the public mind and make il
ca1lous to national dishonor.
The showdown will come wher
congress determines what the Uni
ted States will do in the way OF fur
Their charity toward her debtors. II
the answer is what the temper OF
the American people demands that
it be the result may be refusal to pay
reputation Of the debt and the crea-
ton Of a serious middle in interna-
tional relations.
But out Of that probably would
come clearer atmosphere and event.
ua1ly q greater stability for world
trade and relationships than we now
enjoy with the debts a continual
source Of friction and disturbance.
The American taxpayer might be
left holding the sack and charged
with the cost of Europe's war but
that viii be the case anyhow if the
debts are scaled down in accordance
with the demands OF the debtor ma
tions.