Evening star., 1934-06-03
POSITION
ON DEBTS OBSCURE
Washington Speculates on
London Note Received
Regarding Payment.
BY CONSTANTINE BROWN.

BY CONSTANTINE BROWN.
A communication from the British
government regarding the payment Of
the debt installment due on June Is
vas received last night by the Brit
iSh embassy.
1t is believed that Sir Ronald Lind
say, the Ambassador Of Great Brit
ain, will present the views of his
government to Secretary Cordell Hull
sometime tomorrow afternoon.
Until such communication Is re-
ceived, the State Department officials
are in the dark as to what Great
Britain is going to do. No hint was
received regarding the decision taken
yesterday by the British cabinet,
either from the American embassy in
London nor from the British embassy
in Washington.
Pres Reports Conflicting.
The press reports yesterday were
conflicting and discounted by State
Department officials as "guesswork" Of
reporters abroad
Speculating on whether Britain
would pay another token payment,
Washington diplomats and State De-
partment officials were divided in two
camps.
Some were of the opinion that the
British government. after having
made serious efforts and failed to OBJ
tain promise from the administra-
ton that in exchange for another
payment they would not be considered
defaulters, have decided to pay some
thing "on account" in order to main
tain Britain's reputation of never hav-
Ing defaulted. 1t was argued that
whatever the meaning of the Johnson
act may be, the British government
does not consider itself a defaulter
as long as it continues to make token
payments. This view seems to be
shared by most OF the debtor ma
tions. They all think that the pro-
visions of the johnson act are of
consequence only to this country, but
do not apply directly to the moral side
of partial payments.
Opposed by Public Opinion.
On the other hand, a number of
diplomats and high officials think
that the pressure of public opinion in
England may compel the British gov
ernment to refuse to make even such
small payments as 1t has made dur
ing the last IL months.
AS long as the British government
could tell the House Of Commons that
these partial payments saved Britain
from the stigma Of default, at very
low cost to the taxpayer, there was
but little opposition to their payment.
But now, because of the controversy
which was aroused abroad as a result
of the johnson act, public opinion in
Great Britain Is opposed to any fur
ther remittance of money to the
United States on account of war debts
until a final settlement Is reached.
These quarters believe that the in
ternal situation in the United King
dom-the national government has
been losing most of the partial elec-
tions-will prevent the British gov
ernment from making even a small
token payment. since such an action
would offer an excellent target to be
used by the governments opponents
in political campaign against them.
Decision Awaited.
All the debtor countries which have
not completely defaulted their pay
ments in the past. are awaiting Brit :
aims decision. With the exception of
France. Belgium and Poland. the
other debtor nations will follow Brit
aims example That is to say, they
will pay 10 per cent of the amount
due on June Is, If Britain decides to
pay, or will default altogether, II
Britain decides to take such a course.
The representatives of the debtor
countries are little concerned about
what is going to happen when the
next payment falls due. If pay
ment must be made it will be only
a nominal one. and If nothing is
paid they do not think that 1t will
have any important repercussion on
the relations between their countries
and the United States.
1t Is for this reason that the COM
ment on President Roosevelt's debt
message to the Congress has been
SO moderate.
Governments warned.
Diplomatic missions in Washing
ton have warned their respective gov
ernments for a long time that the
message will be a statistical survey
and will contain no other recommen-
dations than that the debtors must
pay and that they are free to come
to Washington and discuss a new
settlement. But they all know that
this is not the right time to discuss
another settlement because of the
chaotic economic and financial situa-
ton throughout the world. They ad-
vised their governments that the
only policy to be followed at present
is to sit tight and wait. for further
developments.
ACCORD BELIEVED REACHED.
Rritisb prouosaI of Token Paymeuf