Evening star., 1935-04-14
BY WILLIAM r. CASTLE. JR.
Former United States Undersecretar!

Former United States Undersecretary
OF State.
"a 70 ONE with a realistic outlook
N any longer believes that the
debts of the war Of 1914 will
l be paid: even our politicians
understand that full pay
ment of these debts is one of the
glittering promises which they can
never again use to beguile their con-
Stituents. Yet we all know, as the
war clouds once more gather over
Europe, that If the storm should
break we should again be urged to
advance credits, to lend to one side
or the other, or to both.
1t is fortunately true that there
would be no question of Government
lending, unless we should ourselves
become involved-which God forbid.
But If we did become so involved
through a passionate belief that we
must take part for our own salvation,
We should once more advance supplies
with the same ardor that we should
enlist troops. We should have the same
insistent questions which would have
to be answered on the moment; and,
unless we gave different answer. we
should find ourselves after the war
with the same problems which could
not be solved.
I do not think that war Is coming
yet, because I do not think that the
world has so soon forgotten; hut must
admit that there is an arrogance, an
intransigence in the attitude of the
powers which is deeply dangerous to
peace.
This being so, it would seem to be
particularly worth while to refresh our
memories as to what happened, fnan-
cially, during and after the last war;
as to the origin Of the debts; as to why
they will never be paid. The sudden
vanishing of 1000. 100000, even in
these wonderful days when billions are
tossed about like tennis balls, Is a
phenomenon well worth our study and
understanding. This is especially true
when there is even slight possibility
that we may be faced with a similar
situation in the future.
Loans to Allies.
Here, then, are the facts: After we
entered the war we loaned to the allies,
our associates, some $1,000 ,000, 900 to
carry on, and some $4,000, O,0o0, 600 more
for purposes of rehabilitation after the
war was ended. For the amounts ad-
vanced we took the notes of the in
dividual nations; we did not at the
time, discuss details of repayment be-
cause it seemed to us that decent folk
do not waste time discussing details
with friends who are fighting for their
lives.
We thought of the loans, and most
Of our debtors thought of them-then-
as commercial credit which would be
repaid at the proper time. But this
sentiment changed in Europe as soon
as the guns ceased to roar. It is never
as hard to incur debts as to face pay
ment. Europe forgot that our dollars
had helped to prevent ultimate disaster
and began to suggest that we consider
our dollars as our contribution toward
winning the war. After all, they said,
what were our dollars as compared
with their dead? All this was, at first,
only whisper running under the
audible surface of discussion.
At the Peace Conference came the
first official suggestion that the status
of the debts might be altered. Some
body said it would be a good idea to
pool all intergovernmental debts.
Carter Glass answered for the United
States with his usual common sense.
He said that as we had made the loans
to individual nations we should
arrange with them individually the
details Of repayment.
A year later Great Britain proposed
that all war debts be wiped off the
slate in order to boost general economic
recovery. Americans were quick to
see that this meant that we were to
assume the entire burden. They felt
that perhaps economic recovery might
be even more efficiently aided If
Europe would stop its orgy of extrava-
gance, currency manipulation and
militarism, and that thus we also
might share in the recovery.
Pay From Collections.
Shortly thereafter - Europe being
full of suggestions-the idea was ad-
vanced that the allies pay us only
what they were able to collect from
Germany. President Wilson, in q let
ter to MI. Lloyd George, said with
some heat that the United States,
which had asked for no reparations.
did not propose to become the sole
creditor of Germany, nor to help the
allies collect from Germany more
than it was able to pay.
In spite of an undercurrent Of irri-
tstion. however, the justice OF the