Evening star., 1933-02-05
BRITISH bEG|NDEbT
"EDUCAT|0N" DRIVE
Address Delivered to Barclay
Bank Stockholders Cir
cuIated in U. S.
BY FREDERIC WILLIAM VILE.

BY FREDERIC WILLIAM VILE.
London dispatches disclosing that the
British government plans q Campaign
of education" about war debts in the
United States as q preliminary to dis
cussions In Washington next month
coincide with the actual opening of the
campaign. During the past few DAYS
prominent persons In this country have
received 22-page address delivered
on January 19 to the stockholders of
Barclays Bank. London, one Of the
leading institutions of the British Isles.
by Frederick Craufurd Goodenough, its
chairman.
In the course Of a general review of
the British and world economic situa-
ton. Mr.. Goodenough devotes the heart
Of his address to "the American debt"
1t is model Of plain speaking.
Diplomatic and financial authorities in
Washington. who have had access to
them, are convinced that the bankers
statements are reliable index Of the
educational process to which our
British cousins are about to subject the
American people. Mr.. Goodenough
does not remotely hint that John Bull
is prepared to make concessions In
return for American debt favors.
Points Of British Case.
The British case, as it is desired to
represent it to the United States, rests
on these main points:
l. That America docs not yet fully
realize the truth of the view" that war
debts and reparations are indissolubly
linked and must be regarded as one
unit" because, in the settlement OF
these questions, "the various countries
Of the world will prosper or suffer to-
gether."
2. That British finance would hold 1t
to be unreasonable" that the next
on June Is should be paid, and sue
fall due, no matter how long the dis
cussions of the whole war debts pay
ments may be prolonged"
g. That the question for considera-
ton is not only the extent to which
Great Britain shall pay, but also and
perhaps more important, whether Amer
lea can and will in her own interests
and in the interests Of the world ac-
cept payment"
a. That If America wishes to receive
payment, she must accept 1t "in the
only way in which payment can be
made. i. e.. in goods, and, notwith-
standing all the difficulties. make pay
ment possible by a readjustment of
Parts Of Address
In elucidation of these contentious
the chairman of Barclays Bank spoke
as follows:
THE American war debt and the
American economic position present
problems more grave than any others
now overhanging the world 1t has
been unfortunate and disappointing
that. Notwithstanding the good results
achieved at the Lausanne conference,
America declined to grant a further
moratorium for the payment of the
war debts installment due ON Decem-
Der IS, pending full discussion of the
war debts question as whole 1t
would have made matters much easier
II she had done SO, and would un-
doubtedly have paved the way to bet
ter results for all
The problem Of war debts Is best
approached as a question of facts and
not Of sentiment 1t hinges upon the
effect Of payment both upon the debtor
and the creditor. and what, In the long
run, would be the best for each There
has never been any question so far rs
Britain is concerned. as to whether she
will fulfill her contracts or not. The
fulflllment Of contracts IS, and always
has been, the essence Of British policy
and practice. Let us hope for the good
of the world that such will always be
the case. I have been in entire agree
ment with the policy Of the govern
ment in paying the December INSTALL
ment OF the American debt, but in the
existing circumstances, I feel that the
Britain should not pay any further in
stallment until the whole matter has
been discussed and an agreement for
final settlement has been reached. I
think that this is common-sense view.
and one that Is honorable. There must
be some f1nality upon question which
50 vitally affects the present and future
conditions of the whole world"
Mr.. Goodenough at this point launches
into a technical financial dissertation
upon the insuperable difficulties which
must arise If Britain Is compelled. by
the United States to drain to the dregS
the gold supply of the Bank Of Eng
land. In regard to the future" the
London banker says, 'it Is not irhpos-
sible for GRat Britain to hand over
W GIlc 1IU,UUO,VVO pOuAAdo VI
gold which she now holds as backing
for our currency, but this would only
provide for q few installmentS at Wash
ington, and it would defer for a long
time, and possibly forever, q return to
the gold standard not only by Britain.
but also by those other countries whose
currencieS are in one way or another
linked to sterling. venture to think
that in the eyes Of America and in the
eyes of the world, such result would
be regarded as an international dis
aster of the first magnitude. The pay
ment, therefore, of further sums IN gold
may be dismissed as impracticable.
THE only alternative to payment IN
gold Is payment In goods, and IN dis
cussing this possibility We have to con-
slider not only our ability to produce
the goods, but also the ability OF Amer
lea to receive and absorb them. 10
day. quite apart from war debts, Amer
lea has become a great creditor hation,
and if she Is to receive payment from
her debtors she must, Of necessity, for
there is no other permanent alternative,
arrange to increase her imports or de-
crease her exports. Probably both
courses will be necessary and this will
clearly involve tariff notifications, but
if to other payments be added the pay
ment of war debts, something ap-
preaching a free trade policy will, in
my opinion, be required.
Problem Declared Grave.
"1s America prepared to make such
q change? That will be for America to
decide. Will she-can she-face that
upheaval to her economic system which
heavy reduction in tariffs, perhaps
almost amounting to free trade pol
icy, would necessitate? It would involve
considerable adjustment Of capital
and labor and, in the process, q pro-
tracted period Of UNEMPLOYMENT and