Evening star., 1934-05-25
STRUGGLE
WITH DEBT ISSUE
Decision Will Determine
Whether Other Nations
Will Default.
BY CONSTANTINE BROWN.

The decision of the British cabinet
on whether or not to make another
partial debt payment to the United
States on June is Is awaited with
interest not only In Washington but
also in the capitals Of the other debtor
nations. On this decision depends
whether the nations which have made
token payments last year will con-
tinue to do so this year.
The British cabinet took the mat
ter under consideration yesterday. but
no decision will be reached, it is
reliably reported, until the Presidents
debt message goes to the Congress.
Discussed by Little Cabinet.
The question has been discussed
In the little cabinet In London for
the last fortnight. The little cabinet
is composed of Ramsay Macdonald,
Stanley Baldwin, the chancellor OF
the exchequer. Mr. Neville Cham
berlin; Sir John Simon, British for
eign secretary, and the president OF
the Board of Trade, Walter Runci-
man. OF the five British statesmen,
it is reported that Baldwin and Mac
Donald were In favor Of making q
payment, regardless of the opposi-
ton that may come from the Brit
ish public. They maintain that
Britain's honor is involved and the
payment should be made regardless
of the johnson law, which puts the
stigma of detaulter on that country
If full payment is not made.
Chamberlain is reported to favor a
partial payment under certain condi-
tions and would like to know what
formula President Roosevelt would
employ in accepting such payment.
The other two members Of the cabinet
were firmly opposed to remitting fur
ther amounts to the United States,
because the johnson act and the in
depreciation given to that act by the
Attorney General leaves no doubt
that Great Britain would be put in
the defaulter's class.
The matter has now been submitted
to the whole British cabinet for a
final decision, which will be made as
soon as the Presidents debt message
goes to the Senate.
Other Nations to Follow.
The decision of the British cabinet
will be of paramount Importance.
Italy, CZechoSlovakia. Yugoslavia and
Rumania have made 1t clear in Wash
ington that their actions will be di-
reCted by the British attitude.
They are all ready to pay 10 per
cent or less of the amounts due If
Great Britain decides to make a par
tial payment and will pay nothing If
Britain does not.
The action of France. Belgium and
Poland. who are outright defaulters.
may also be guided by the British at
titude There is vague possibility
that these three debtor nations may
revise their decision not to pay this
time. although Frances position is
particularly difficult despite the de-
sire Of the Doumergue cabinet to reg
ularize Its situation. A mere token
payment by France of 10 per cent of
the amounts due on June Is certainly
will not satisfy American public opin-
ion and the administration. The
French have not only refused to pay
any token payments, but in Decem-
ber, 1882, when Great Britain paid
the full amount due on that date,
France did not pay cent.
Larger Requirement Possible.
II France wants to regularize It's
situation, it may be necessary for her
to pay much larger amount than
the nations which have partially full
filled their obligations, and it is
doubtful whether the French treasury
will be in q position to Llake such q
payment at present.
The Doumergue cabinet is reported
to look at the situation from a diff
ferent angle. Whether France pays
on June Is. 500. 900 or only So
100000, she will still be In default,
according to the letter of the law,
But the French government is not
interested in whether the johnson
act defines any country as de-
faulter, but merely wants to prove its
good will and its respect for a signed
agreement by making gesture. which
it hopes would place France in "a
more favorable position when the
question Of the revision of debts
norooc i'm ouoin