THE WAR DEBTS.

King Country Chronicle, Volume XXVI, Issue 3448, 22 November 1932, Page 4

THE WAR DEBTS.

It is reported from Washington that when the President, Mr. Hoover, and the President-elect, Mr. Roosevelt, meet, the feeling of the two will be against a further moratorium or a reduction of the war debts. A further message states that America financiers, administrators, and the press realise that it is impossible for Britain and the European countries to meet their war debt obligations, and the American people alone refuse to face realities. This is an outstanding example of political exigency. The President and future President of the United States are supposed to be both administrators and financiers, and as such must realise how impossible is the position of the European countries in regard to the war debts. In face of this fact they defer to the popular public opinion of a misguided people. The war--debt problem will evidently reach a crisis within the next few weeks. Great Britain and some European counti-ies have made formal application for a temporary suspension of the payments due next month. Britain would be the last to ask for such a concession unless very hard pressed, for it has always been the traditional policy of that country to honour all her obligations. If the United States insist in payment and Great Britain and France announce that they cannot pay, the situation will open up some strange issues. The proceedings at the Lausanne Conference were based on some concessions being given to the European nations by the United States. Now that any concessions have been flatly refused it may bring about a complete change ot European policy —a change that will not be in the interests of world peace. The more influential press of the United Slates has taken up a mflre reasonable attitude over these debts than the politicians. The New York Times points out that the real value of British payments to the United States has risen 54 per cent, since the funding of the debt, if the present currency, exchange rates, and cost of living are taken into consideration. Britain has to pay the United States about £20,000,000 in gold for principal and interest, but owing to the depreciation of sterling this amount has been increased to £28,000,000. Yet what benefits are accruing to the United States over these payments and those of the

European countries? They are killingworld trade, and the United States is feeling- the effects of this as much as any other country. It is extremely disappointing that the President-elect takes the same view as the President on these war debts. A more reasonable attitude was expected from Mr. Roosevelt on this big world problem, but it seems that he is bent on following up the policy of Mr. Hoover in demanding what will in time prove an impossibility—payment in full of the war debts. It will now be interesting to know what line of action will be taken by Great Britain on this subject. She may be able to pay the instalments next month by further sacrifices on the part of her people, but these are now reaching breaking point, and it is more than probable that the European countries will not be able to meet their payments to the United States. A more reassuring message received this morning states that President Hoover is now advocating the re-creation of the War Debts Commission with a view of giving some concession to Britain. Opinions change rapidly in the United States, however, but it is at least satisfactory to know that the President, while asking Britain to meet the instalments due next month, is willing to re-open the question so far as Britain is concerned.