The Washington times., 1937-12-17
British View of War Debts

debts the question: OF hOC these deOtS can DC pdd dS
rarely been considered. Many of us, perhaps, hare
thought that England France Italy could Just mail
check, boz up enough gold bullion and ship orer
here
While the riecS herein expressed are not orr o1n, 1ce
thouqht it night be interesting the other side of
the picture distinguished British economist uho be-
Heres strongly the sanctiy contracts and coud like
in the interest of Great Britain herself to satsfac
tory settlement of m old and disturbing conroversy has
aryitteu his opinion for The Washington Times.
The }ongvngc hereafter is that of cleor-thiutjng
economist representative of the study gren the
question abroad:
6GTF ENGLAND were now paying the semannua in
staments, including interest and amortization
fixed by arrangement with Congress, the annual charge
would amount to 200 million dollars in round figures.
"This charge has to be met not in pounds sterling
but in dollars For the pound sterling has no current
Choroe Must Re value in the United States
"There are just two ways in
Me' III DO''"0 which Great Britain can ac-
cumulae dollar balances this country. She either
ship gold or she can sell the United States goods and
services.
To ship gold to the value of 200 million dollars to the
United States every year without taking anything in
return is practically out of the question: This country
already owns about half the gold supply of the world
and in the ordinary course of events merely to take
care of trade balances more gold is coming in month
after month to such extent that it is necessary to
sterlize it and put it cut of action in order to avoid
disastrous wave of initiation.
"Already this flow of gold to America is causing an
artificial scarcity of gold in the rest of the world with
the unfortunate result of fall in the price of basic
Fall in Price of commool"eS' ~n,cn IS one Oh Tile
chief causes of the present
Commodities 49,:
"To accentuate this flow of gold by 200 million dol
lars year would further drain the gold resources of
Europe, intensity European gold scarcity and bring
on the worst panic of modern times.
'We may, therefore, bar out payments of the debt
in gold as being wildly impractical.
''The other alternative is shipment of goods or SELL
ing of services.
''England in the past has supplied good deal of the
worlds oceanic transportation of passengers and
goods Today she has to face heavily subsidized COM
petition on the part of Germany, Italy and France.
Even the United States insists on owning merchant
marine
"She cannot hope therefore, to increase those services
except in an infintesinlal degree.
''She can and does ship goods, either from Great
Britain itself from her colonial possessions in the
Malay Peninsula and elsewhere in the shape of rubber,
tin and other useful commodities.
'But England practically the best customer of the
United States and she has to ship the last possible
pound of rubber and ton of tin in order to pay what
she is actually buying from the United States in the
shape of cotton wheat and manufactured goods
''Therefore, to accumulate the dollar balance
sary for the payment of debt instaments there
? Tbirns Tint just two things she can pos
siby do.
EHyI0"0 CU DO "She must either sell 200
million dollars worth of goods more than she is
selling this country she must buy 200 million dollars
worth less of this countrys goods.
EThe first method is at present impossible. The
United States does want the goods and has put up
a tariff wall to keep them out.
''The second is possible, but not desirable. Eng
land could in time manage to grow all the cotton she
needs within the empire and she could put an en-
barge American cotton, wheat, copper and other
commodities until she able to establish favor
able trade balance with the United States to the tune
of 200 million dollars year.