The Western news. [volume] (Libby, Mont.) 1933-current, 1935-02-07

the court would probably uphold the
right OF the government TO change the
terms OF private contracts. but not to
change the terms of government bonds.
Just Surprising
Now assume for the moment that the
court will rule this way, and consider
the results. The government would
have to pay gold for Its gold clause
bonds on maturity. But the Supreme
court has upheld the right OF the gov
eminent to commander gold at the old
price So that anyone holding such a
bond could demand the gold, receive 1t
and then have 1t taken right away by
| the government at the old price. The
net effect of which. SO far as American
holders of the bonds are concerned.
| would be precisely zero.
Foreign holders of such bonds. how
| ever. would not be subject to having
| their gold Communicated at the old
prices SO that the net effect, assuming
| all foreign holders demanded and re-
celved gold at the old rate for their
| bonds, would cost the government. 1t
Is estimated. less than S60,00O,0OO. Not
so good, but hardly chaos.
But there are other complications to
| minimize even this. For Instance, the
Hague court decision that the action
OF the American government had set
! tied the matter
| What gives that worried look to the
treasury tax experts. trying to figure
| ont the next taxes to be advocated to-
ward the end of this session, Is not
The difficulty of devlslng taxes which
/ will raise the money In the least pain
| full manner. but the idosyncracies--as
/ they see them--of senator's and MEM
| hers OF the house on thls point. For
/ instance, when the sales tax was pro-
/ posed there was hullaballoO about
/ taxing the poor mans groceries.
| Whereupon food and clothing were
promptly eliminated. But there has
hardly been a peep about the process
Ing taxes. designed to aid agriculture.
though these touch the poor mans gro
ceries. shirts and clothing carefully
skipping over most Of the luxurles
Reciprocity Treaties
Protracted delay In obtaining the
reciprocity treaties that were to lIven
up American exports and permit en-
try into this country at lower tariff
duties of goods. which world not do
ve-Y lnucn harm To American workers.
Is being widely criticised. especially
in view OF the high hopes with which
George Peek and Secretary OF State
Hull embarked on the enterprise.
The chief. II not the whole, trouble
has been the most favored nation
clause existing In nearly all American
treaties with other countries. Which
means to say that II America reduces
the tariff on brandy. as a concession to
| France for example. America would
also have to admit italian. Spanish
Greek and South America brandies at
the same reduced rates Whereas. none
OF these other countries might he max
ing appropriate concessions to take
more American goods.
At the present moment negotiations
with Spain have virtually begged down
The whole trouble is that 1t has beer
found next to impossible to define sher
ry wine In such way that only Span
ish sherry would be meant. Merely tf
reduce the duty on sherry would moi
solve the problem.
The Spanish negotIators say. witt
some point. that cheap-they call then
mitation-sherries are produced ir
many countries. notably Italy. Portu
gal and Australia. not to mention South
America They are willing to reduce
duties on American goods. which would
result In very fair increase In ON
exports, indeed. according To experts
but only II this country makes a spe
cia concession to sherry produced Ii
Spain only.
Which the most favored nation
clause makes Ii impossible to do, as ou
Department of State views the situa
ton,
Causes Mirth
All OF which, however. Is causlnj
gales or laughter In most OF the for
eIgn chancelleres They say, verya prl
vately, of course. that no nation In thu
world Is so utterly squeamish abou
such things as the United States 0
America.
But they do not say that to the Stat
department. 1t seems to be q sort o
. gentlemen's agreement among the othe
countries of the world that not evel
for the selfish advantage OF any one o
them may that one tip Off Uncle San
to what s going on. lest the effects 0
that tipping Off recnl on them all.
But just as IN illustration OF wha
Is being done. Britain has special trad
/ agreements with both Spain and POI
tugal. In those agreements. curIousl
enough, sherry figures for Spain, an
! port for Portugal The agreement wit
, | rpcuprt ~ sherry Ia E0 drawn thar n