The Auckland Star WITH WHICH ARE INCORPORATED The Evening News, Morning News, The Echo and The Sun. MONDAY, JUNE 4, 1934. A BARGAINING WEAPON?

Auckland Star, Volume LXV, Issue 130, 4 June 1934, Page 6

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

MONDAY, JUNE 4, 1934. A BARGAINING WEAPON?

For the cause that lacks assistance, For the vyrong that needs resistance, For the future in the distance, And the good thai ae can do

With tlic approach of llic date for the June payments on account of war debts, President Roosevelt seems to have made up liis mind that there is no other course but to wait and see what happens. His message to Congress plainly indicates this, and it has been received in comparative silence. Although a statement was made by Senator Hiram Johnson last month that "nations which have not paid their debt commitments in full will be in the category of defaulters after June 15," the President has now advised Congress that no legislation during its present session is either necessary or desirable. The President thus remains as free to accept token payments from the debtors as he was last year, and it is still open to him to class Britain as a nation which has not defaulted. Will he do it? When Britain made a token payment of £2,000,000 in June of last year, the President in a message to the people declared that Britain had not defaulted. Other countries, including France, made no payment, and became defaulters on these debts. There would be little inducement for Britain to pay a token sum if she were to be placed in the same category as France, and as the payments cannot be revived in full the only alternative is for America to take what is offered or to force Britain, as the principal debtor, into the ranks of the defaulters. America could gain nothing by such a course, and it would be deliberately provocative of bad feeling. So the position as between Britain and America at the moment is "token payment or nothing." The President has said that the American people will be influenced by the use which debtor nations make of their resources. This, of course, is a reminder that if large sums continue to be spent on armaments, America will not be impressed by a plea of inability to

pay, but America is not able to take the sam< ' high position to-day in using such an argumen that she could a while ago. Her entry intc the armaments race has left her without £ forum • from which to preach disarmament There are, however, other directions in whicl President Roosevelt can insist upon a sanei attitude in Europe. The economic war, ir which the weapons are tariffs, quotas subsidies and so on, is damaging to the trade of the world, and, if the debtors plead thai the state of trade makes it impossible foi them to pay, the President can retort • that it is only one of the upsetting factors. If wai debts were wiped out there would still remain Other obstacles to recovery. It is possible to admit the truth of this and yet to hold that the debts are the villain of the piece; without them the world would not have been driven to excesses of nationalism. Unfortunately, the wiping out of the debts to-day would not immediately restore conditions to normal. Readjustments in many other directions would have to follow, but progress is held up while the obstacle which the debtors insist is the main one is there.. That there is a wicW gulf between opinion on the opposite sides of the Atlantic is obvious. Although it is not of President Roosevelt's making, and although it was his misfortune to inherit a hopeless muddle, it is he who has the power to-day to work out a solution. If he cannot collect the debts he seems .determined at least to use them as a means of bargaining for concessions on trade, but, perhaps unfortunately for him, the attempt to gain much along this line has come so late as to give ground for few hopes.