The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1935-09-13

more cotton since it is an important
factor in manufacturing high ex-
plosives. She would possibly want
to buy more cotton. But if she did
she would have to buy less of some
thing else. since her purchasing
power in the world market is
limited.
But, of course, we have no right
to assume that she would buy this
extra cotton from us. If she did
it would not be a very great deal.
She would need metals. But she
has been accommodating iron for some
time in expectation of war. Her
purchases of scrap metal from us
and presumably from others-has
been increased during the last six
months. Mussolini is said to have
claimed that he has sufficient iron
and steel in hand to meet the needs
of his African adventure.
AS for cOal-the dictator has
sought to increase Italy'S coal pro-
ductiOn and supplement it with sub
stitute fuel-hydro-electric power
and petroleum. But he still must
have coal. We could undoubtedly
sell him some, and he would buy
from other countries. He has, in
fact, already laid up immense stores.
But all these commodities would
MT l1a Tfolv, F,sOt1a
about so to ga million dollars of
goods a year. In the last six months
this buying has not been speeded
up, though it has changed character
a little.
What would happen in the event
of war is that Italy would buy but
very little more from us, but would
make its purchase of those goods
most needed for the war and buy
less Of those goods which make up
the bulk of her peace time pur-
chases.
But if she were to double her pur-
chaSes it would not amount to a
great deal. Last year she bought
from us $64,000,000 of products.
This means that each Italian is good
for $1.45 of buying from us in
year, compared with $40 from
every Belgian, Sc from every Hol-
lander and more from each English
man.
Italy can not buy more from us
or any country because she can not
sell more. The balance of trade has
been persistently against her. In
1928 she sold 16,0OO,OOO,OOO lire of
goods abroad. In 1884 it was only
a little over 100000 900. She has
had to cut out her own purchases,
therefore.
And even then the balance re-
mains heavily against her. She has
had to pay the differences in gold.
Thus her central bank gold reserves
have dropped from 7,100,000000 lire
to 5,800,000,000 lire year. She dare
not drain off more of her gold. Her
currency, as it is, is already in
constant danger.
She has sustained heavy loss
in her invisible imports-chiefly
tourists expenditures and remit
tances from immigrants. She can
not buy from us in larger quanti-
ties because she has not the goods to
pay for her purchases.
1t is inconceivable that we will
sell her on credit She simply is
not a good risk. This is not said
in any spirit of antagonism I am
simply trying to make plain
business report on her financial
standing.
Her budget has been continu-
ously out of balance since 1880. |
For four years she has had def
cts ranging from three to six bill
lion lire. This year it will be two
billion, according to her finance
minister. 1t will probably be more,
and this does not include the costs
of the Ethiopian enterprise.
Mussolini can not balance his
budget save by cutting expenses
or increasing taxes. He dare not |
cut expenditures. He keeps affoat
by his large payments to labor,
unemployed, subsidies to indus
try, etc. If he were to cut them
his economic system would COL
lapse. Instead of cutting he pro-
posses to increase them by making
war.