U.S.A. LOAN NOT WANTED

Greymouth Evening Star, 14 September 1945, Page 5

U.S.A. LOAN NOT WANTED

LORD KEYNES’ ASSERTION EMPIRE TARIFFS DEAL WASHINGTON, Sept. 13. Lord Keynes made it clear that Britain was not considering a commercial loan and would not agree to one. One reason was that she did not care to embark on commitments she might not be able to fulfil. Lord Keynes was less definite in answering questions about the possibility of a grant in order to assist Britain over her reconversion “hump,” but questioners gained the iflrpression that this might be what the British delegation had in mind. When asked what the selling points of such a programme would be in the United States, Lord Keynes contended that liberal commercial policies would expand world trade, thus contributing to the earnings ana prosperity of the United States as well as other nations.

Asked about Empire preference, cartels, the sterling bloc, and allied subjects, Lord Keynes replied that Britain was prepared to reduce them and move away from them, comparing such a movement to a reduction of tariffs by the United States. Lord Keynes said that Britain’s role had been to mobilise a greater proportion of her population for a longer time than any ally, for actual fighting and munitions production. Britain, instead of having to expand her exports in order to pay for her own consumption and also" provide for her allies, was enabled and encouraged by lendlease, mutual aid from Canada, and also the equivalent of loans from the sterling bloc countries, to sacrifice two-thirds of her normal exports in order to transfer labour to war activities. The result was that Britain would take much longer than America to restore her exports to the prewar level. Moreover the loss of a considerable part of the British assets which had helped to pay for imports before the' war meant that Britain would not “break even” until she recovered her industry to achieve a volume of exports 50 per cent, higher than before the war. This was a colossal task. The financing technique adopted for the sterling area, said Lord Keynes, had resulted in the financial and commercial arrangements of a considerable section of the world becoming almost inextricably entwined with the financial and economic affairs of London. Most of the sterling area countries, in effect, advanced to Britain substantially all their external resources. The result was that they could not continue to trade freely with the rest of the world unless Britain was in a strong enough position to release to them as purchasing power some part of these resources. One alternative for Britain was to do her best with her resources and aim at emerging slowly’from her' temporary difficulties with as little outside aid as possible, depending on the various defensive trade mechanisms which had been developed by war controls. The other course was to work out with the United States some means of returning as early as possible to normal trade practices without discrimination, and also to increased freedom and liberality in commercial and tariff policies. Lord Halifax said that the anniversary of the Battle of Britain would be celebrated in a few days. Just as that battle was fought, not only for Britain but for the world, so the economic deliberations now taking place would affect not only the two countries but the whole world. He pointed out that the end of the war had brought to the British public warnings that this Winter they would be less warm, well clothed, and well fed, while Americans were being promised nylon, new refrigerators, and automobiles within a short time.

AMERICAN OPINIONS WASHINGTON, Sept. 13. Highly placed American officials, commenting on Lord Keynes’s statement, said that Britain had no more chance than a snowball in Hell of getting Congress to approve of a grant in aid. Britain would probably get a loan of 4,000,000,000 or 4,500,000,000 dollars at 2.j or 2J per cent. Britain’s commercial policies and sterling debt would have to be thoroughly discussed before any aid was given. Another responsible source said that. Britain had established an economic isalationism much worse than America’s tariff system. “We must not interfere with England’s method of carrying out the nationalisation of her economic or political life, but she must not ask us to expend ourselves in helping her to hurt us,” said this source. The New York “Herald-Tribune; in a leading article commented: “A new formula for aiding Britain and, for that matter, all other Allied countries and the devastated Axis Powers must be devised. We say ‘must,’ for the simple reason ■ that the United States should ■be as ready with resources to win the peace as it was to win the war. Lord Keynes expressed Britain’s wants as between 3,000,000,000, and 6,000,000,000 dollars, on the basis of a grant in aid. Politically speaking at least, this is a preposterous demand. On the other hand we can understand British repugnance to a purely commercial loan. Something in between —ensuring us some recompense—should be arrived at.”

SUGGESTED TERMS WASHINGTON, September 14. Britain is in a very serious financial position, but any help given must be approved by Congress, said the Under-Secretary of State (Mr. Acheson), at a Press conference. He said the current talks would not at first produce what he termed definite settlements of any of the various financial or commercial problems, but would lead to further actions by the Anglo-American Governments. Representative Celler (Democrat, New’York), introduced a resolution in the House urging American representatives in the current talks to insist on fair British trade practices as a condition precedent to granting any kind of help. The resolution aiso called for an assurance that sterling would not be devalued and a promise that Britain would not approve the cancellation, wholly or partly, of the debts she owed to her Dominions, protectorates and colonies. We must offer and give help to England, said Mr. Celler, “but that help must be with enlightened self-interest. Unless England dissolves the sterling bloc and abrogates the Imperial preference tariff duties we must withhold that financial aid she seeks.'

CANADIAN POLICY OTTAWA, Sept. 12. Canada desired to return to international trading similar to that prevailing before the first world war, said Mr. M. W. Mackenzie, DeputyMinister of Commerce. “Our interest can lie only in the direction of a multilateral system of international trade so that individual countries overseas are not driven to balance international payments one with another,” he said. Mr. Mackenzie added that formerly the pound sterling and the United States dollar were universal currencies, allowing Canada to buy and sell where she pleased. This form of multilateral trading broke down in the first world war, broke down again in the depression, and finally collapsed on a much more serious scale in the war just ended. Canada’s 1945 wheat crop is estimated at 321,409,000 -bushels, which is 114,000 less than last year.