Evening star., 1943-08-21
Fiscal Experts AssaiI
New Treasury Plan
For World Bank
BY the Associated Press.


NEW YORK, Aug Ala number
Of important monetary experts il
New Yorks financial district saic
yesterday they doubted the new
money-stabilization plan proposed by
the United States Treasury coulo
be made to work under postwar
conditions.
The plan, the Treasury's second
tentative blueprint for an interna-
tional money and foreign trade
system after the war, followed
similar proposals by both British
and Canadian authorities.
Some of Wall Streets leading
authorities on international none
tary transactions long have been
skeptical of the probable success of a
comprehensive, overall super
bank" of the type called for in the
first and the current Treasury pro-
posals and the Keynes plan ad-
vanced by Great Britain.
Less Formal Plan Urged.
Many commercial bankers who
would have to deal with an inter-
national money authority would
rather see some less formal and
more flexible approach to the prob
lem of creating an international
money mechanism.
Chary as usual sof comment on
pending proposals in Washington,
several nevertheless talked freely on
condition that they be not identified
by name.
Neither this nor the earlier Brit
ish and American proposals is likely
to get anywhere as long as they call
for supernatural authority which
can bring strong-perhaps decisive
pressure on the course of prices and
business in the United States or
other participating countries" one
banker said.
II think the farmers in the United
States, particularly, would revolt at
the idea of any body which had the
actual or potential ability to control
their prices and were not subject to
their political pressure.
Furthermore, it might subject
the United States to all kinds of in
ternational political complications,
whether or not we had veto power
over the actions of any international
authority"
The new Treasury proposal is gen.
orally seen as weakening the veto
power of this country over the
"superbank" as compared with the
original American plan.
If We used such a veto power"
this banker continued "at a time
when our interests conf1icted with
those Of number of other members
of the international credit union,
they'd be sure to- howl that we
wouldn't play marbles.
'If we didn't use the veto at
time like that, we'd probably get
kickback at home that would wreck
the scheme"
Said another banker:
What we need Is more flexible
and less formal approach to none
tary stabilization, with not so many
hard-and-fast rules laid down for
travelling uncharted territory"
An initial informal arrangement
between the Federal Reserve banks
and the Bank Of England, with the
adherence of British and CONNER
cial banks, seemed the best way to
start an international currency
stabilization plan, this banker sug-
gested.
Winthrop w. Aldrich. chairman OF
the Chase National Bank Of New
York, has been an outspoken critic
of the "superbank" approach to the
problem. He told the American Sec
ton of the International Chamber
Of Commerce on April %:
ITO be enduring, the stabilization
Of exchange rates must rest on the
firm basis of sound internal fiscal
and monetary policies.
I'VE cannot erect a monetary su-
perstructure until we have built a
nrm base.
90. An overall stabilization of
exchange rates would seem to repre-
sent an unrealistic approach to the
problem.
Each nation must, as 1t did after
the last war, painfully retrace Its
steps to monetary stability"