DEBT CRISIS

New Zealand Herald, Volume LXX, Issue 21518, 15 June 1933, Page 11

DEBT CRISIS

ACUTE TENSION BRITAIN AND AMERICA 'OFFER TO WASHINGTON PRESIDENT'S DECISION PARTIAL PAYMENT HINT Bv Te'eprnph—Press Association—Copyright (ifeceivcd Juno 34, 5.5 p.m.) LONDON. Juno 13 A despatch from Washington states ■that according to an authoritative .source this evening President Roosevelt lias prepared his reply to the formal British Note on the war debt issue received at the State Department to-day. Carefully distinguishing between receiving and accepting Britain's proferred partial payment Mr. Roosevelt is expected to take the sum offered on the distinct understanding that his action in sc doing will not invalidate America's claim to the unpaid remainder. Another message from the American capital says Mr. Roosevelt will reply to-morrow to the British offer of a partial payment of her war debts with a message which is expected to cause •surprise among the nations. There is basis for the conviction held here that the injection of the war debts question into' the Economic Conference has brought about a situation which calls for an answer from America. It is indicated in liigh quarters in Washington that the surprise will be contained in either Mr. Roosevelt's message in reply to the debtors or the accompanying document. It is said to be the intention of Mr. Booscvelt to receive Britain's proffered partial pending accomplishments by the Economic Conference in the direction of the stabilisation of currencies and a lowering of the world's tariff walls. SUte of Excitement in London Although the British Cabinet sat until midnight and assembled again at 9 a.m. to-day to consider the war debt position it is reported that further urgent exchanges with Washington took place subsequently. The crisis is overshadowing all else. There' was little sign of an agreement at mid-day. Mr. Cordell Hull (the United States delegate) postponed his speech at the Economic Conference, as the result of despatches he received from Washington. The Sun news service says the debt situation is changing every hour. It has provided Whitehall with 30 hours of continuous tension comparable to the crisis which led to the Great War. Three meetings of the Cabinet and several of its sub-committees succeeded each other within 18 hours. Electric Atmosphere in Commons Ministers and officials rushed to telephones or motored between the Economic Conference and Downing Street. A mere handful of people is aware of President Roosevelt's momentous decision, details of which the Chancellor of the Exchequer, Mr. Neville Chamberlain, drafted into a statement while locked in a room behind the lobby in the conference hall. The House of Commons was packed, everyone awaiting Mr. Chamberlain's speech, which had been announced for 5.50 p.m. The members of the Cabinet, excepting Mr. MacDonakl and Mr. Chamberlain, sat on the front bench until 5.45 p.m. when Mr. Baldwin, Mr. Walter Runciman, and Mr. J. H. Thomas suddenly were called behind the Speaker's chair. The atmosphere became electric as it Was realised that a hitch had occurred. It was believed that Mr. Roosevelt suddenly had changed his mind and desired to avoid the necessity of immediately facing Congress and that, therefore, he wished to postpone his statement until Thursday (the date when the debt instalments fall due). Question of a Token Payment The full Cabinet met hurriedly. Ministers Were in a quandary, more especially since Mr. Roose'velt's original decision to accept a token payment from Britain had caused such relief. The news now is common property, it being impossible to withhold a statement of such magnitude, which no longer 1 is a Cabinet secret. Ministers sat for a few minutes, nfter which the Atlantic telephone cables again buzzed to urge the desirability of an immediate statement by Mr. Roosevelt. Then it was announced that Mr. Chamberlain would speak at 10 p.m. Mr. Chamberlain appeared in the House at 10.10 p.m. and further startled members by announcing that the full statement he had hoped to make regarding the war debt instalment could not be made yet. However, he said, there had been a lengthy exchange of views between the British find United States Governments. " The British Ambassador at Washington, Sir Ronald Lindsay, to-day handed to the State Department a Note setting forth the British proposals," said the Chancellor. " We expect- to receive the President's reply . to-morrow. We have no reason to suppose it will be other than satisfactory to us, but as it has not reached us yet I am not in a position to state its terms." Statement Postponed for One Day Mr. Chamberlain said he understood Arrangements had been made by which it would be possible for the debate to be adjourned until 10 p.m. to-morrow, and he hoped he would be able then to makf a complete statement on all the ■documents exchanged between the British and United States Governments. It' is learned that-the Cabinet's decision to postpone the statement until to-morrow was due to Mr. Roosevelt s ■desire immediately to follow the announcement in America with a personal continent-wide broadcast, thus appealing to the populace over the heads of Congress. it is understood that Mr. Roosevelt will reiterate, as in his despatch to Rritain, his consistent support of a practical debt settlement and will propose as part of an understanding between Britain and America immediate negotiations, possibly in London, in order to secure a final and equitable discharge.