Red Lodge daily news combined with Carbon County news., 1933-07-12
WHY TEN PER CENT?

According TO press dispatches the European nations
which owe us money are preparing to get together ana OIL
fer us in payment of the so-caDed war debts a total OF
"ten per cent or nothing" A great many people, looking
at the immediately practical result will jump to the con-
clusion that ten per cent is better than nothing and that
we ought to take the ten per cent and forget about the
whole matter.
A more careful examination of the question, however,
leads to serious doubt as to whether this is the correct
view to take. Most of the European countries are well
able to take care of their obligations, much better In fact
than poor but honest little Finland who pays on the dot.
France has the greatest hoard of gold In ratio to popula-
ton, in the whole world, and Great Britain has on hand
now more gold than ever. In addition, a little agreement
on the scaling down of armament, would save much more
than enough money to make these annual payments.
Again, if we accept a small sum in complete payment
and wipe off the debt, it wont be long until some of these.
same nations will be back to borrow more money for new
military adventures. If the books are clear they will have
little trouble In getting it, if not from our government,
certainly from international bankers who will lend, not
their own money but that of the people of the United
States entrusted to their care. Then the trouble will start
all over again.
But if they offer us ten per cent or nothing and Uncle
Sam elects to take nothing but to keep the figures in red
ink on his ledger, it will not be so easy to float interna-
tional war loans in America. in the future. That is why
the borrowers are so anxious to have the slate wiped
clean. They do not want to pay, neither do they desire to
default because they know they may want to borrow in
the future. In a very sound and sensible editorial on the
debt question the Detroit Free Press recently said:
MANY persons, even here in America, are saying that
in view Of the general attitude of the country's foreign
debtors, the thing for us to do is to throw up the sponge,
and tell them they need not pay their obligations; that
the people of this country should be taxed and made to
pay in their stead. These individuals seem to think that
by letting Europe put over its dead-beat game the United
States will in some way further the economic r~ehabilita-
ton of the world. They appear to forget that success in
racketeering always breeds racketeering.
''The United States cannot force payments from coun-
tries that owe it money because in many cases the only
way to do so would be to go to war to collect; and that
would not be worth while from any standpoint. But be-
cause it cannot exercise duress, it does not follow that
America should make default easy and pleasant for those
engaged in doing the bilking act. 1t can let the world
know plainly what it thinks about that sort of thing and
can serve notice that III is not going to forget. 1t also can
remember the records of defaulters the next time they
are in a tight place and want to borrow more funds.
"In particular the debt defaults should be a warning
to the United States in considering the plans and pro-
posals that may be laid before it in the course of the pres
ent economic conference, especially as there is plenty O.
reason to suppose that the chief aim of one clique presen
there is to soak America In any agreement reached
this country should take care to protect itself and no
again be fooishly generous
Speaking of the proposal for a ten per cent general tar
iff reduction, some of the boys on our delegation mus
have oOt their SIGNALS miynd