Evening star., 1943-04-07
No Extra Cost Seen
In Morgenthou's
Sterilization Setup

4" N'OIyeHtHuu
Sterilization Setup
Continued From First Page.)
100000 domestic sterilization func
which has been in operation for nine
years. Should the internationa
agency be established, it is believed
the Treasury could simply switch
this fund to the new world pool
thus providing the United States
share without the necessity of extra
financing.
With the projected international
fund operating to stabilize curren-
cies, Treasury officials said, the need
for continuance Of exchange con-
troll by individual countries would
be almost entirely removed. The
Domestic Sterilization Act expires
June 80, but Mr.. Morgenthau is
expected to ask Congress to con-
tinue it another two years.
Although some department attor-
reys believe the Secretary has
authority under existing law to enter
into the international agreement,
Mr.. Morgenthau told reporters he
had no intention of acting without
legislative sanction.
IT wouldn't think of doing any,
thing without congressional ap-
proval," he said.
The Secretary made public late
yesterday the full details of the
Treasury proposals submitted to
United Nations and their associates
who have been invited to send rep
resentatives here for discussions.
Replies already have been received
from 10 nations, Mr.. Morgenthau
said, and he expressed confidence
that the others would soon follow.
France was not invited.
Mr.. Morgenthau emphasized the
proposals were merely tentative, but
he predicted that prompt adoption
of such a program would help stave
off economic collapse after the war,
revive world trade and give renewed
hope to countries now under Axis
domination.
The Secretary described the
Treasury plan as an enlargement
of the tripartite agreement among
the United States, Great Britain
and France, which could be dropped.
Veto Power to U. S.
The text of the proposals re-
vealed that the United States would
have a veto power in the con-
trolling board by virtue of its sub
stantial contribution in money.
This would be accomplished under
rules requiring a four -hfths vote
on major decisions and limiting any
one country to Is per cent OF the
total vote. The votes would be ap-
bortioued on the basis of contribu-
tions and since the United States
would be one of the countries quail
flying for the maximum number OF
votes, it could block a four-flfths,
or 80 per cent, majority on any
issue.
Other major points include:
Creation of a new monetary unit
to be known as "unitas' which
would be used as bookkeeping de-
vice by the fund.
The fund would fix the value OF
world currencies in terms OF gold,
and changes In exchange rates
could be made only with the ap-
proval of the fund and "only to
meet an extreme situation"
No member country could adopt
new exchange control measures ex-
cept to curb undesirable capital
movements, then only with the
funds consent.
Board of Directors.
The fund would have power to
buy and sell gold, currencies and,
with their approval, securities OF
member countries. The fund would
deal only with the treasures, cen
trail banks of fiscal agents of men,
Der countries and with international
banks owned predominantly by
member countries.
The fund would be managed by
board of directors which would in
clude one member and one alternate
from each country.
Each member would be required to
make an initial payment to the
fund of so per cent of its quota,
such payment to be made up OF
121a per cent of the quota in gold,
1879 per cent local currency and
p5 per cent in its own securities.
However, any country having less
than 100000 in gold need pro-
vide initially only 7l2 per cent Of
its quota in gold and any country
having less than 100000, 900 in gold
only S per cent, the contributions
of local currency being increased
accordingly.
Mr.. Morgenthau said the main
purpose of the fund would be to get
nations back into healthy trade
position, and that therefore adjust
ments would have to be made to
flt individual cases.
I'VE can't expect nation like
Yugoslavia, which has been raped
by the Germans, to put up its full
quota of gold" he said.
Its to our interest to get such
nations into position to carry on
trade and restore a healthy eco
nomic life. We've got to set a
country like that on its feet. The
only way to do it is to say your
currency is good"
Reconstruction Agency.
The Secretary disclosed that a
separate international agency to
provide capital for reconstruction
and development in war-ravaged
countries is under consideration.
A memorandum circulated to the
81 nations said. TT should be en-
phasized that the appended draft
deals only with an international
sterilization fund 1t is anticipated
that there will also be submitted for
consideration a preliminary draft Of
a proposal for an international
agency whose function will be to