Evening star., 1943-04-07
Great Britain Offers World Bank Plan Goinq
Beyond Proposal of the United States

under which currencies for the pur-
pose Of world trade would be on a
gold basis, while for domestic pur-
poses they could be valued on what
ever basis the individual nation de-
sired.
While the contribution of the
United States to the stabilization
fund would be Substantial" Mr.
Morgenthau said, it would be lin
our selfish interest"
I'VE are the richest nation in
gold" he said. 1--WE will be one
of the few nations in a position
to export after the war If this
fund is ready when hostilities cease
the governments participating will,
In effect, act as insurance agents for
their exporters and importers. Pri-
vate enterprise will have all the ad-
vantages without the risk OF
huctuating foreign exchange"
Mr.. Morgenthau said the
stabilization fund would not be an
artificial device, but a matter of
the various governments stepping
in to tide trade over the immediate
postwar era. When the fund is no
longer useful, he said, it can be
terminated
Voting Power.
A suggested distribution of voting
power on the governing board, in
which each country would have a
representative and an alternate,
called for es, h nation to have 100
votes plus one vote for the equiva-
lent of each 100000 of its capital
quota.
The restriction on changes in ex-
change rates, which could be made
only with the approval of the fund
and only to meet an extreme situa-
ton, is designed to prevent COM
petitive currency depreciation among
nations.
With these porvisions, the need
for continuance of exchange con-
troll by individual countries might
be almost entirely removed. No
member country could adopt a new
exchange control measures except
to curb undesirable capital move
ments, then only with the consent
Of the fund.
The fund would be given power to
buy and sell gold, currencies and,
with their approval, securities of
member countries. The fund could
also borrow local currency with the
approval of the governments con-
cerned.
While no provision has been made
for admitting the Axis nations to
membership, Mr.. Morgenthau said
that the door is not closed" to them,
but that it would be up to Congress
to decide if and when they could
qualify for membership.
Those to whom the invitations to
confer on the proposals went were
Australia, Belgium, Brazil, Canada,
China, Costa Rica, Cuba, Czechoslo-
vakia, Dominican Republic, Ell Sal
vador, Ethiopia, Great Britain,
Greece, Guatemala, Haiti, Honduras,
India, Iraq, Luxembourg, Mexico,
Netherlands, New Zealand, Mica
ragua, Norway, Panama, Poland,
Union of South Africa, Union of
Soviet Socialist Republics, Yugosla-
via, Bolivia, Colombia, Chile, Ecua-
dor, Paraguay, Peru, Uruguay and
Venezuela.
President Questioned.
President Roosevelt was asked at
his press conference yesterday
whether there was any connection
between Mr.. Morgenthau's gold
plan and the expiration OF your gold
powers" Mr.. Roosevelt said he did
not know his gold powers were ex-
piring soon, but he thought Congress
might approve a relatively short
extension.
(Mr. Roosevelt cut the dollars
gold content to about SO per cent of
its former weight with the purpose
of raising prices during the 1888
depression. The law under which
he acted was extended in 194l for
two more years. Unless Congress
acts by June 80 the dollar will be
frozen at its present value and
$4,000 100000 in the Treasury's sta
bilization fund will go into its gen.
eral fund.-
Mr. Roosevelt told reporters he
imagined that where negotiations
regarding gold reserves behind cur
rencies of the world are concerned,
We ought to get congressional action.
Mr. Roosevelt asserted, in addi-
ton, that at the end of the explora-
tory period on monetary matters
now underway, all kinds of legisla-
ton probably would have to be OBJ
tanned. One way of handling his
gold authority, he suggested. would
be for Congress to approve a rela-
lively short extension.
Treasury officials said the Amer
ican plan has the same objectives
as versions of the British plan
received in this country, but differs
in one major respect.
The American plan calls for a
$4,000 900, 900 stabiization fund with
every participating nations con-
tribution on the basis of a fixed
formula.
The British plan, officials said,
provides for no such fund and would
require no such contributions. In
stead participating nations would
get bookkeeping credits and debts
on the basis of their standing in
world trade prior to the war Alloca-
ton of quotas and control would be
determined on the same haSis
The British plan would create a
new monetary unit to be called
"bancor." This would be a book
keeping device similar to the
"unitas' provided for in the Amer
ican plan.
World Clearing Union
Proposed by Keynes