Evening star. [volume] (Washington, D.C.) 1854-1972, 1940-11-24
Direct Aid Possible
Without Repeal Of
Johnson Act
By GARRETT d. HORNER.

lions of growing popular support
here for some action to relieve the
British of the burden of paying cash
for the airplanes and other supplies
they are buying in this country.
Public discussion has centered for
the most part around prospects for
repeal of the johnson Act, which
forbids loans by any person In
the United States to any country in
default on It's obligations to this
Government. and for repeal or
modification of a similar ban in the
Neutrality Act against credits to
belligerents.
Direct Loan Possible.
1t was poitned out in interested
quarters last night, however, that
direct Government loans or gifts
to Britain could be made within the
framework of the johnson Act, al
though Congress presumably would
have to authorize such action
through appropriation measures.
In the johnson Act, which has
been generally considered strict
prohibition against any form OF
credit to Britain in view of her de-
fault on her World War debt to
this country. the term person" to
which its ban applies is defined as
including any:
Individual. partnership, corpora
ton, or association other than a
public corporation created by or
pursuant to special authorization by
Congress, or corporation in which
the Government of the United
States has or exercises controlling
interest through stock ownership or
otherwise"
This provision was interpreted
as clearly sanctioning direct Gov
eminent credits to a defaulting ma
ton If Congress should make the
money available. 1t also was pointed
cut that the johnson Act does not
prohibit outright gifts OF money or
materials.
Must Face Question Soon.
When Lord Lothian arrived in
Washington last night. reporters
asked him specifically whether
Britain had any present intention
of requesting modification or repeal
of the johnson Act.
1T is not for us to make such
suggestion" he replied.
He said, however, he thought
the question of how Britain was
to continue to pay for munitions
purchases in this country would
have to be met within the next six
months, although he explained the
limit of her financial resources de-
pended on a great many factors.
I'VE have paid for everything
so far" he said. but our gold and
securities resources are being liqui-
dated"
He declined to estimate the total
of Britain's war expenditures here
but said it was much more" than
the 81 200, 900 900 suggested by one
interviewer.
Great Britain's financial resources
in this country have not been made
public, although they were esti-
mated at over $4,000, 000, 900 when
the war began in September, 1899.
S2,5o0, 900. 900 In Orders Placed.
The British Purchasing Commits
sion announced recently that it had
placed orders for $4,000 900 900
worth of war materials up to No
vember /. This figure does not take
account of other types of purchases.
British holdings in the United
States at the end of August, 1899,
were estimated by the Federal Re-
serve Board at 1890, 0O0, 900, in
Guiding $4,000, OO0, 900 of central gold
reserves, $685., 900 900 of dollar bal
ances, $735, 000, 900 of readily ne
gotiable securities, and 5000 900 900
of direct and other investments.
In addition, Canada had holdings
estimated at $1,070, 100000 and
other British Empire units had sew
eral hundred million dollars.
Actual shipments to Great Britain
during the first II months of the
war were valued at $3.50, 900 900. Of
which 1910, 1000 was war ma
terialS.
Aid Is Called Insurance.
Joseph P. Kennedy, Ambassador
to Great Britain, suggested in q re-
cent Boston interview that supplies
be given to the British with no
strings attached when their financial
resources are exhausted.
Speaking of aid to England as
insurance in that by helping her
to continue resistance to axis ag-
gression this country was gaining
time in which to prepare it's own
defenses, Mr.. Kennedy was quoted
as saying: We'll take 1t (cash)
from them while they can pay for
what they need, but when they get
through, give 1t to them, mark 1t
oil, as insurance"
Possibility that the administration
would move to finance British pur-
chases here through Government
loans or outright gifts before the
critical point in Britain's finances
is reached, without seeking repeal
of the johnson Act, was advanced
in informed quarters here because
of two major considerations.
It was pointed out that such .
proposal probably would encounter
less opposition in Congress than
would q drive to repeal the johnson
Act, because the vote would be on
specified and limited measure,
(See BRITISH AID, Page A-40