AUSTRALIAN WAR DEBTS.

Press, Volume LXVI, Issue 20021, 1 September 1930, Page 11

AUSTRALIAN WAR DEBTS.

READJUSTMENT ADVOCATED. EFFECT OF LABOUR RESOLUTION. (tTXITED FRR3S ASSOCIATION—BI ELECTRIC TELEGRAPH -COPYRIGHT.) SYDNEY, August 30. The report of the political and industrial committee recommending the repudiation of war debts has been submitted to the Australian Labour Paity executivo and was neither adopted nor rejected. r l he executive, instead, carried a motion the effect of which was to advocate a reduction of war loans interest and to call on the Prune Minister, Mr J. H. Scullin, to negotiate for a readjustment of war debts. A resolution was passed advocating the abolition of the Loan Council. DOMINIONS' INDEBTEDNESS AMOUNTS OUTSTANDING. LONDON, August 29. A British Blue Book shows that for the year ended March 31st, Australia repaid £1,4fi0,000 principal on war loans and also £4,088,000 interest, compared with New Zealand £400,00U and £1,340,000, and South Africa s £2,071,000 and £395,000. Outstanding war loan indebtedness on March 31st, embracing book debts and bonds, was as follows: £ Australia ... • 81,298,000 New Zealand ... 26,838,000 South Africa ... 7,500,000 The two former are being paid off in annuities. GRAVE ISSUE RAISED. LONDON COMMENT ON PROPOSAL (Received .August 31st, 5.5 p.m.) LONDON, August 30.

"The Sydney Labour Executive's proposal that Mr Scullin should appeal to Great Britain for a readjustment of the war debt raises a very grave issue," says the "News-Chronicle" in an editorial. "We greatly doubt whether any British Government will dare to accede to such a request. Great Britain up against hard times, with no immediate prospect of recovery. Unliko Australia, we are kept on the rails in national finances, but we simply cannot go on playing the fairy grandmother, even to our own kith and kin. During the war Australia treated her fighting forces with lavish generosity, and in the matter of debt wc have treated her with real consideration. The proposal means that now it is 110 longer possible for Australia to borrow, wo nhould present her with a substantial gift. That is not Sir Otto Niemeyer's remedy."

CENTRAL -BANKS ADVOCATED. THE "ECONOMIST'S" SUGGESTION. (Received August 31st, C.5 p.m.) IONDON, August 30th. The "Economist," in commending Australia's adoption of Sir Otto Niemeyer's plans, comments on the earlier difficulties of Australia and New Zealand from 1878 onwards. The solution of each brought improvements in banking policy, till now they > were in the soundest position. The time was - ripe for another advance in the direction of a central bank in each of the Dominions, linked with the Bank of England. This would prevent, it was claimed, a crisis such as tlio present, notably by forestalling exchange difficulties.

WORLD'S ECONOMIC ILLS. LACK OF PURCHASING POWER. VANCOUVER PAPER SUGGESTS REMEDY. (Received August 31st, 5.5 p.m.) VANCOUVER, August 30. "The world is interested in Australia's financial problems because what is handicapping Australia is also worrying the world," says the "Vancouver Sun" in an editorial, "The left wing of the Australian Labour Party suggests repudiation of Australian debtß, a five years' moratorium, and tbo mobilisation of community credit. This Is the first official -quawk that has been made by a responsible debtor nation, but it is a squawk that will be repeated round the Western world if there is not made quickly a realignment of the world's credit and a re-apprisal and re-apportion or the world's metallic money, silver and gold. The debt of Australia is serious. Australia, however, with great producing areas, is, probably in a much better position to pay the debt than England. What ia bankrupting Australia is also bankrupting and paralysing all the big producing nations of the world, that is, lack of world-buying power. Wha* is causing the lack of world-buying power is the unsound distribution of world credit and the refusal of European bankers to recognise the necessity of restoring silver at one to twelve in world money taken with gold. There are only ton billions of gold in the world, and through hoarding restrictions, embargoes, and the mad scramble for gold, the yellow metal is getting into fewer and fewer hands; China, India, South America, and those countries that have only silver money have a small world credit and have had the buying power of their silvpr jiioney cut to 25 per cent, of the 1870 value, and are gradually being forced out of the market for world commodities. This reduction in purchasing power of silver money countries is reason why world trade is slackening off. That is why surpluses of goods arc e/prywhere piling up, and is the real reason why the world's trade faces stagnation, '' Must Australia go bankrupt, or will Australian surpluses again start moving to world markets? How else than by restoring the buying power of Asia and other silver countries can England's economic peril be averted? It has been sound business for the world to allow a small population liko Australia to pile up a debt of six billions; surely it is-necessary and sound business for international bankers to

restore silver and establish credits that will start the world surpluses moving off towards the millions of foet and backs that are Dare and mouths that are hungry among the billion people, in Asia.' If the pound sterling ia not to go the way of the French franc, the German mark, the Russian rouble, there ia urgent need for international bankers and so-called world leaders to prove themselves worthy of their responsibilities."