Evening star., 1940-12-02
S1OO,OOO,OOOLoan
To China Approved
By Congress Units
PIun Backed Unanimously;
Moreenthuu to Close
Deal at Once
b. the Associated Press.

By the Associated PRESS.
Members of the Senate Banking
and House Coinage Committees gave
an unanimous vote of approval to-
day to transaction by which the
United States will advance the Chi
nese Chungking government $780,
100000.
OF the total credit, $4,000 900
would come from the Treasury's sta
bilization fund and a like amount
from the Export Bank.
After hearing Secretary of State
Hull outline a general policy of. aid
to Chang Kai-shek's government
and Secretary of the Treasury Nor
genthau explain details of the pro-
posed agreement, the group, includ-
ing IL Senators and House men,
bers, gave Secretaries Hull and Nor
genthau a vote of confidence.
Senator Wagner, Democrat, of New
York explained that the congress
sional group was concerned only
with proposed operation of the s2,-
600 900 900 stabilization fund to sup
port the Chinese currency.
Morgenthau to Close Deal.
Up TO s50,000,000 of this fund Is
expected to be used to give China
exchange to purchase war supplies
in this country. The s50000.000 to
be advanced through the Export
Import Bank is expected to go for
general Chinese government uses.
Mr.. Morgenthau told reporters
that "I got what came after-a vote
of confidence" and would pro-
ceed Immediately to close the deal
with China.
Nov we are going to go downtown
and do business as fast as the law
yers will let u.s." he declared.
Secretary Hull said he considered
the Chinese agreement vital mat
ter" adding:
Under the circumstances it is the
least we can do for the job that
China is doing" He did not amplify
this statement.
Complies With Promise.
Mr.. Morgenthau explained that he
had asked the congressional COM
mitteemen to assemble in today's
closed session so that he might
comply with a promise made more
than 18 months ago not to expand
the operation of the stabiliZation
fund without first notifying Con-
greSs.
I'VE have complied with that
promise and We have been given a
vote of confidence" he said.
Before the meeting there was one
note of congressional sentiment
struck against the loan from the
StabiliZation fund.
Senator Adams, Democrat, Of
Colorado, told reporters that if the
proposal was as represented, he
would oppose it on the ground that
the stabilization fund was not the
proper source to supply the money.
Plans for the $100,000,000 help
ing hand" to Chungking were an
nounced during the week end, giving
pointed new emphasis to the ad-
ministration's policy regarding jap
anese activities in China.
Prior to the session, Senator
Adams said Il think the stabiliza-
ton fund operations should be kept
within the bounds for which it was
created by Congress.
Most of us thought that this fund
was to be used to maintain the
parity of the American dollar and
I don't think it was ever intended
to serve as a reservoir for loans.
ct don't doubt that China needs
money, but there must be other
Government agencies from which it
can obtain funds"
Used to Bolster Exchange.
The stabilization fund, created
out of dollar devaluation profits"
has been used in the past to bolster
international exchange, largely
through purchases of British and
French currency. 1t has been used
little since the European war.
Chinese requests for loans were
said to have been based on the con-
tention that Chang Kai-Shek's
government could not keep its army
of 2,500,000 in the field against
the Japanese much longer unless it