FRENZIED FINANCE

Evening Post, Volume CXX, Issue 126, 23 November 1935, Page 12

FRENZIED FINANCE

IN ITALY AND GERMANY

COLLAPSE OR ESCAPE?

Mr. H. Wickham Steed, writing in the "Contemporary Review," gives the following facts concerning the financial situation in the dictatorship countries, Germany and Italy. He writes:— "A German periodical, 'Das . Neve Tage-Buch,' published in Paris on September 6, shows that between Hitler's advent on January 30, 1933, and the end of May last, the total of the German internal floating debt in the form of—mainly Government —promissory notes and bills of exchange rose from__ £425,000,000 (at par) to £1,340,000,000. (In sterling these totals are nearly double.) "During the twenty-eight months of the Hitler regime up to the end of last May, the balanced revenue of the German Exchequer came to roughly£Bso,ooo,ooo (at par), Supplementary Estimates and admitted debts to some £212,000,000, and the secret expenditure and debts to £912,000,000. "In this period more than £1,000,000,000 (at par) of the expenditure was financed by. short-term bills, i.e., the German floating debt increased by over £1,000,000,000. On August 31 this debt had risen to £1,470,000,000 (par). On that date the British short-term floating debt was nominally £900,000,000, and really not more than £650,000,000 sterling. "Germany seems thus to be heading for utter bankruptcy—or for some adventure, that shall disguise, justify and,.it may be fondly hoped, pay for the. Nazi gamble. How, as far as can he ascertained, does Italy stand? She has.had a series of deficits, each admittedly formidable, since 1930. According to her official figures, onequarter of the national expenditure in the financial year 1933-34 was unbalanced by revenue, and the real deficit mast have been far larger. .. . CERTIFICATES. "The Fascist. Government has financed its public works and agricultural schemes and paid its vast subsidies to shipping and other enterprises by issuing certificates for 'deferred payments' in the form of 'Labour bills' and otherwise, or undertakings to pay by. annual, instalments during periods extending- to fifty years. "The liabilities are not mentioned in the Budget. But the Italian Finance Minister recently estimated that, Detween the advent of Fascism in 1922 and the current year, the 'present capital value' of these deferred payments had gone up from 4000 to 24,000 million lire, or roughly, from a little over £40,000,000 to more than £242,000,000 at post-war par. These commitments are outside the recognised national debt, which rose by some £120,000,000 in the same period. "These (approximate) figures are already out. of date. They take no account of the outlay upon preparations for war against Abyssinia which had cost more than £6,000,000 at postwar par, or some £10,000,000 in sterling, by the end of April. "Since then it is safe to reckon that this figure has been quintupled and, according to some estimates, the total cannot now be far short of £100.000,000 sterling. No wonder that Italy has been driven to spend her gold reserve. In almost every sense of the word, Fascism has for some time been bankrupt. "Any reflecting mind ought therefore to have understood that either Nazism in Germany and Fascism in Italy were heading for economic and financial collapse, or that their leaders were planning some escape from disaster through foreign adventure or the threat of it."

]~ The chain letter craze which swept through Australia and New Zealand a few months ago on its way around the world brought one of its reactions at Princeton (U.S.A.), where Arthur Banton, coloured, was convicted of killing his wife because she answered chain letters. He was sentenced to life imprisonment.