The Auckland Star: WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun. MONDAY, JUNE 29, 1931. WAR DEBT AND MORATORIUM.

Auckland Star, Volume LXII, Issue 151, 29 June 1931, Page 6

The Auckland Star: WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun.

MONDAY, JUNE 29, 1931. WAR DEBT AND MORATORIUM.

For the cause that lacks assistance, For the wrong that needs resistance, For the future in the distance, And the good that tee can do.

The problem of the Moratorium has been advanced a further step toward solution by the decision *of the French Chamber of Deputies, which, by a large majority, approved the Government's reply to Mr. Hoover's proposal. It is a significant fact that at one stage of the debate it seemed likely that the Socialists and Radicals would vote decisively against the Government, and there is evidently a strong demand in France for safeguards and guarantees if this concession is to be made to Germany. However, on the assurance of Ministers that the Young Plan would be maintained intact, and that provision would be made for renewing the reparation payments after the Moratorium expires, the Chamber, at the end of an all-night session, rallied strongly round the Government, and the principle of the Moratorium has been emphatically endorsed by the nation. The point on which the French Government desires to modify Mr. Hoover's scheme naturally bears ' on the "unconditional" payments. Not only has France based her financial estimates for the year on the assumption that these payments would be received, but she is clearly apprehensive that if these "unconditional" payments are once remitted a dangerous precedent may be established, and the Young Plan may ultimately be cast aside. Accordingly, the French Note to Mr. Hoover, while declaring France's willingness to forgo German reparations for one year, points out that confidence in the Young Plan would be shaken if the Moratorium covered the "unconditional" payments. The Note, therefore suggests that this fraction of the reparation charges "should be paid into the Bank for International Settlements to be used as a credit for Germany." By this ingenious device the principle of "unconditional" payments would be maintained, and at the same time Germany would be prevented from employing these funds for military or naval purposes, or for any object injurious to France or dangerous to international peace.

Under the circumstances, France can hardly be blamed for insisting , on due precautions against loss or danger through Germany. But it is very satisfactory to learn that, in the opinion of the American Secretary of State, there is nothing really incompatible between Mr. Hoover's proposal and the conditions laid down by France. Certainly Mr. Stimson's comments suggest that the American Government is quite prepared to meet France halfway in this matter, and the "gratifying cordiality" which marks the French Note should ensure a satisfactory conclusion for the negotiations noAv in progress. All the omens now seem favourable for the success of Mr. Hoover's scheme, and even the prospect of its realisation has already produced an encouraging and beneficial change in the Avorld's industrial and financial markets.

Thus the Moratorium is now almost "an iccomplished fact"; and, turning for a moment to ourselves, there seems to be ao sound reason why the Dominions should not take advantage of this favourable "turn ■>£ Fortune's wheel.'" We understand and sympathise with the motives that have induced Greneral Smuts to urge that South Africa, which is in a relatively prosperous position, should decline Britain's generous offer. But New Zealand can hardly afford to wave Britain's gift aside; and it should not be forgotten that our refusal would place Australia in an extremely difficult and invidious position. On the whole, we think that the Government and Parliament are fully justified in their decision to accept Britain's offer, ami the people of this Dominion can express their appreciation of her generosity by enlarging the opportunities for the sale of British goods in our own markets.