Evening star., 1940-02-25
Finnish Loan Debate Reveals
Clash Of Fiction and Reality
Money for Arms Is Viewed as an Overt Act While
Funds for Food Are Regarded as Wholly
Neutral in Principle
By Raymond P. Brandt.

League of Nations that she had not de-
clared war against Finland and Finland
has informed our State Department that
she was merely in a state Of SIEGE"
These experts cite the 1928 conven-
tions drawn up at Havana, Cuba, for
the American republics which included
provisions to the effect that loans could
be made by neutrals to belligerents for
food supplies, raw materials and other
F. George. Democrat, of Georgia, an
opponent of the Finnish loan, told the
Senate that these provisions merely ap-
piled to the American republics. But
the other experts explained that the
Havana conventions were a codifica-
ton of international law and therefore
applicable in principle to all countries.
The official Interpretation regarding
humanitarian loans is evident in Presi-
dent Roosevelt's letters on January 16,
to Vice President Garner and Speaker
Bankhead, proposing that the Finnish
loans be made through the Export I'M
port Bank. These letters said in part:
There is without doubt in the United
States a great desire for some action
to assist Finland to finance the pur-
chase of agricultural surpluses and
manufactured products, not including
implements of war. There is at the
same time undoubted opposition to the
creation of precedents which might lead
to large credits to nations in Europe,
e;thor holliooropfc mr. ,oautro1c
"An extension of credit at this time
does not in any way constitute or
threaten any so-called involvement in
European wars. That much can be
taken for granted"
Regarded As At War.
Nor has the President taken the
strictly logical position that technically
Finland is not belligerent. At recent
press conference when he was discussing
the sale to neutrals of surplus military
supplies, including shoes and British "75"
field artillery, he was asked whether
such equipment could be sold to Finland.
He replied in the negative, observing
that Finland was actually at war.
The same officials who hold that q
governmental loan to Finland for mill
tary purposes would be unneutral, de-
clare that private loans or gifts for such
purposes could not be regarded by Rus
STA as an overt act. Citing the prece-
dents followed during the World War
before the United States entered on the
side of the allies. these experts point out
that both sides in that conflict fi0ated
private loans in this country to obtain
credits for war materials. The govern
mental loans to the allies we're not made
until this country entered the war.
Private contributions, the experts say.
could be collected at present to buy war
equipment for Finland since the actions
of individuals are far different from
those of governments.
Although the Senate passed by vote
of IS to the resolution of Senator Pat
Harrison. Democrat, of Mississippi, in
structing the Securities and Exchange
Commission to expedite consideration of
a private loan to Finland, no such loan
has yet been sought and there is no
evidence that one will be sought in the
near future.
Neutrality Act Effect.
OF course, if the 1899 Neutrality Act
should be invoked against Finland and
Russia, private loans for military pur-
poses or private gifts for the same pur-
pose would not be allowed. The act
contains rigid provisions on these points.
1t does not, however, cover Government
loans. Such actions are covered by gen.
eral international law which prevent
neutral government from giving military
aid to belligerent. If the neutrality
law we're invoked, Finland would come
under the cash-and-carry provisions.
Recent press reports from Finland
have spoken of the severe disillusionment
in Finland where 1t was expected that
American aid would be forthcoming in
the form of arms and without delay.
This hope apparently was based OF
widespread expressions of sympathy that
came from public officials and private
individuals. Finnish representatives in
this country say they know nothing of
the reported disillusionment, stressing
the deep gratitude that has been sx-
pressed for all American aid.