The New Zealand Times. MONDAY, SEPTEMBER 4, 1922. GERMANY’S WAR BILL

New Zealand Times, Volume XLIX, Issue 11306, 4 September 1922, Page 4

The New Zealand Times. MONDAY, SEPTEMBER 4, 1922. GERMANY’S WAR BILL

While the Reparations Commission rejected by two votes to one—France and Belgium against England, Italy not voting—-Sir John Bradbury’s motion in favour of an unconditional moratorium for Germany to -the end of the present year, his policy has in substance prevailed. The German proposals with regard to reparation payments were unanimously rejected; then came the vote, above referred to, deciding the fate of the British. Commissioner’s suggestion; and the Commission then unanimously accepted the Belgian proposal allowing payments to be made to the end of the year in German sixmonths’ Treasury bills. Germany thus owes her respite to the generosity of Belgium. The Treasury bills are to be hacked by guarantees upon which the German Government and the Belgian Government, to whom the payments have been assigned, must agree. Failing agreement as to the guarantees, an alternative arrangement ip the earmarking of about £14,000,000 worth of the Reichsbank’s gold, or the deposit of that amount in a bank acceptable to Belgium.

In Sir John Bradbury’s opinion, the latter arrangement, is undesirable, as it wonld involve pledging a portion of the gold reserve in the Reichsbank, and that reserve is an important factor in the interests of German credit, beggars, however, cannot be choosers; and, failing any other acceptable method of guaranteeing the bills, tho Reichsbank will, perforoe, have either to earmark or part with its gold. Under the Reparations Commission’s decision, Germany has, as “Le Journal” points out, received facilities almost ‘equivalent to a moratorium; and that should content her for the time being. The Berlin Press, indeed, welcomes the breathing space, though anticipating difficulties in meeting Belgium in regard to the required guarantees. The Berlin newspapers, state the cables, all declare that the Reichsbank could never allow it 9 gold to be deposited in any foreign bank; but this declaration is discounted by the message that the London “Daily Express” understands that Germany will offer three banks, the Detitsciier, the Dresdener. and the Disconte; and, failing the Allies’ acceptance of these, will deposit tho guaranteed money in Copenhagen or Berne. Germany, as a matter of fact, is in

such a parlous plight financially tbat 6he will be only too glad to avail herself, on any terms that are at all possible, of the relief afforded by the ac-. 1 ceptance by the Commission of Belgium’s magnanimous proposal, Ifow serious is the position is indicated by the fact that the Berlin correspondent of the London “Times” stated, under date August 31st, that Germany’s currency has completely broken down, and only the earliest callers at the banks have had their cheques cashed; while heated altercations have occurred with employers who found that they could not pay out the monthly salaries, the workers receiving only a portion of their wages. The printing presses, he added, would work ceaselessly, over the week-end. The daily output is 3000 million marks, including notes of 10,000 marks, a denomination regarded as likely shortly to become small change; and it is considered that increasing prices may necessitate a 6till greater output of paper money. That, however, could not really ease the situation, since the greater the inflation. of the currency, the higher prices will soar. The position is, in short, a vicious circle from which Germany seems at present to have little, prospect of eseape. It is to be noted that the decision arrived at by the Reparations Commission applies only to the payments due on August 15th and September 15th, and, unless other arrangements are made later, to those due on October 15th and December 31st. The entire question of future payments, and particularly of those due in 1923, still remains to be considered. In view of this fact, particular interest attaches to the reply to Earl Balfour’s Note m regard to inter-Allied indebtedness, in which France suggests the holding, of an Allied Conference to investigate the whole question of debts and reparations. The Balfour Note to France. Belgium, and Italy, a courtesy copy of which was also sent to the United States Government, intimated that Britain would be 1 willing to cancel the Allies’ war debts to her. on condition that Britain’s war debts toAmerica and the Allies’ debts to Britain were considered as a whole. Indeed, if the cancellation of war indebtedness was general, Britain was prepared to go further and cancel also; her claims to reparations from Germany. Unfortunately, America, up to the present, has shown no ..willingness to fall in with this suggestion. She still maintains her aloof attitude so far as the affairs of Europe are concerned, except in regard to the suggestion, tentatively made to M r . Krassin and M. 'l'chitcherin, of a: United States Commission of Technical Experts to study and report on the economic situation of Russia, with a view to aiding the United States Gov-, eminent to determine what economic Contribution it can make towards the reconstruction' of Russia. The reason given for, this suggestion is that the United States is understood to be concerned over the large concessions Russia has extended to foreign nations. Whatever the reason, however, the fact that the suggestion was made is Welcome, as showing that America is at last awakening to the fact that the industrial and financial position of Europe concerns, not Europe alone, but also the United States, and, in fact, the whole world. On the other hand, President Harding’s refusal to send Mr H. C. Hoover to the Reparations Commission is by no means a hopeful sign. Governor Cox, it is true, stated, when interviewed on this subject, “There is some reassurance in President 1 Harding’s hope i that America may later interest herself in the European economic situation.” . But, he added, significantly, “Let us hope, our services will be those of a. physician,, not an undertaker.” Perhaps, though not willing to send Mr Hoover to the Reparations Commission, President Harding may be able to see his way to allow him to attepd the Allied Conference, suggested by France, to examine the. question of war debts and reparations. .