Evening star., 1947-09-04
1reasury,0fficiaIs
Call Bevin Proposal
On. Gold 'Cockeyed'
by the Asseeiotsd Press


"oockeyed" a proposal by British
Foreign Secretary Bevin that the
United States redistribute its huge
gold supply to help put the world S
economy back on an even keel.
IF other countries want our gold.
said one onacial, who cannot be
named, they can have 1.-THE
same way we got 1t from them
by laying the money on the line
at our price Of s35 an ounce. The
for sale sign is out on it."
.Onicials available here were
unanimous in saying that any re-
distribution OF gold would require
action by Congress. They expressed
surprise" or even "amazement"
over the Bevin proposal.
Snyder Won't Comment.
Boiled down to man-to-man
terms" one said, "Bevin's PROPOSE
ton seems to amount to saying
Give me back the gold I've sold you
or paid you with so can sell it
to you again.
Secretary of the Treasury Snyder,
departing from New York for Lon
don to attend the World Bank and
Monetary Fund conferences next
week, confined himself to:
Il have no comment. I haven't
had a chance to study it (the Bevin
proposal, made in a speech to the
British. Trades Union Congress) and
determine what the Implications
might be-"
Without saying whether he would
speak to Mr.. Bevin about it in Lon
don. Mr.. Snyder said the subject lis
q United States matter" and there
fore under no circumstance" would
be listed for discussion at the meet
ing OF the 45-nation bank and fund.
Bevin Not Specific.
Mr.. Bevin did not specify what
sort OF redistribution of gold he had
In mind, and some officials here said
they were "baffled" by his meaning
or reasoning.
The United States Government
owns over s21, ,765 DOT 900 worth of
gold at the $35 an ounce price That
has prevailed for over 13 years. Vir-
tually all of it is reserve backing-a
sort of security-for paper money
or Federal Reserve bank deposits
Treasury officials said about
s12,500, ,000, 900 of this gold is kept
at the Army stronghold at Fort
Knox. KY, about 80 miles from
Louisville, which was especially
equipped to store it 10 years ago
after the Government had called
In all gold coins from circulation.
The rest is in smaller concentra-
tons in Government mints or assay
Offices in Philadelphia, San Fran
cisco. Denver, New York and
Seattle, and in the Federal Reserve
banks.
Gold Paid Debts.
Romanticists say that the United
States holdings - which approx
mate three-f1fths of the worlds
known gold money stocks-include
gold once carried in Spanish gal
Icons from the new world to the
old. found In the California gold
rush of 184S. and dug from Ameri-
can or foreign earth this year.
The United States got it either by
purchase from American miners or
foreign owners. The foreign "pur-
chases" consisted principally of &C
cepting gold in payment for trade
debts. These debts arose when the
foreign countries bought more from
the United States than they sold
to it.
The COLDS Importance to the
United States internally, apart from
the fact that the Treasury will sell
1t to make jewelry or tooth filings,
etc. springs from the fact that it
ID q part of the countrys money
system. even though it does not
circulate.
The Federal Reserve banks are re-
euired by law to have at least Is
cents worth Of gold in reserve to
secure each dollar of paper money
they issue and each dollar of de-
posits they enter on their books.
Backing Now About so Cents.
At present. they have nearer so
cents in gold for each dollar of
paper money or deposits, or nearly
twice the minimum required-but |
ofYicials say that does not mean they
can spare some of it any easier.
They explained:
All this gold-including the SEEM
ing extra" amounts an asset
against liabilities, and if any gold
were given away an equal amount
in some other sort of assets would
have to replace it.
Some officials observed that if the
whole United States stock of $2l,-
765, ,9O7 900 of gold was split up
among the two billion population Of
the entire world, it would give each
person little more than $40. But
they added that each OF the 144,-
100000 Americans would have to
produce many times that sum to
restore the assets given away.
Can't Follow Bevin Logic.
Ofhcials generally said they could
not follow the reasoning" of one
Bevin statement that the United
States had caused high taxation in
her own country by failure to re-
distribute the Fort Knox gold
Most said they felt sure it would
mean higher rather than lower taxes
in this country If the gold were
given to other nations.
They conceded that giving gold to
foreign countries would increase the
buying power of the latter as Mr..
Bevin had said it would. But they
added that it would also increase
imitation and raise prices in this
country because it would step up
foreigners ability to buy here.