The Auckland Star: WITH WHICH ARE INCORPORATED The Evening News, Morning News The Echo and The Sun. MONDAY, NOVEMBER 21, 1932. A WORLD IN BONDAGE.

Auckland Star, Volume LXIII, Issue 276, 21 November 1932, Page 6

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

MONDAY, NOVEMBER 21, 1932. A WORLD IN BONDAGE.

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.

Early this year Sir Arthur Salter, in commenting on the effects of reparations and war debts, said the world was moving towards a point where trade would be reduced to those few commodities which were indispensable arid could not be produced at home. He saw the streams of international trade drying up under the withering touch of these payments. Europe, realising this, has put an end to reparations; but war debts remain, and while they remain there is the shadow of a cloud over Europe and a dead hand on world trade. A warning of the trouble is given to-day by the difficulty with which Britain is faced in preparing to make her debt payments to America. These fall due in mid-December, and amount at the present high rate of exchange to about £28,000,000, a sum which, in normal times, would be paid with ease by a great nation. Times, however, are abnormal, and the public in America apparently refuse to face the plain fact that war debts are a cause of the abnormality.

Meanwhile, America suffers with the rest of the world from the paralysis of trade, and the loss to her must be many times the £50,000,000 (at par) which is the total due to her this year from fifteen European countries under the debt-funding agreements. Already, under these agreements, America has received £434,000,000, and of this sum Britain has paid more than three-quarters. To meet these payments she has received a considerable sum in reparations; but, reparations being ended, she has to fall back on her own resources, and the same applies to' France, Italy and the smaller States of Europe. These resources have been strained to a point which is strikingly indicated in the case of Britain by the mounting adverse balance of trade.

Last year, as an index of the growing seriousness of the position, Britain's trade delTcit, after the income from overseas investments, shipping and other invisible items was taken into account, was £75,000,000, and this year it is estimated the figure will be £90,000,000. In three years Britain has gone back almost £200,000,000. Yet Britain has maintained her trade at a higher level than have most countries. Even more striking than the British figures are those relating to international trade. They show a shrinkage that has continued its disastrous course for almost four years. Particularly illuminating are the export returns of the United States. Between 1929 and 1931 these fell from over £1,000,000,000 to less than half of that amount, and there was a further fall during the first half of this year until in July the exports were at a level which was little more than half the average for 1931. Evidence of the same kind can be found by looking at France or Germany, to take only the leading countries of Europe; and this should be a warning of the perilous consequences of allowing the present trend to continue and a spur to immediate action. America's attitude has been that, if Europe can-afford to spend money on armaments, she can afford to pay her debts, and this explains to some extent the rigid stand taken. Here is a forcible reminder to the nations of the need of reaching agreement on the question of disarmament. It is needed for economic recovery as much as to advance the cause of world peace. Scaling down of armaments, solution of the war debts problemSj lower tariffs to assist trade —these are the needs of to-day if the nations are to escape from worse disaster.