DEBTS TO AMERICA

New Zealand Times, Volume L, Issue 11412, 8 January 1923, Page 4

DEBTS TO AMERICA

HOSTILITY TO REMISSION NOT JUSTIFIED BY ECONOMIC OR MOFAL GROUNDS. BUSINESS MEN'S VIEWPOINT. A striking presentation of American opinion on the proposal I hat the Allied debts should be remitted has been contributed to the London "Times'' by Mr Julius H. Barnes, president ot the United States Chamber of Commerce, •which has nearly 800,000 members.. . ‘ There are, it seems to me, some realities upon which adequate 'stress has not been laid in the discussion of a proper treatment of Allied debts," he wrote. "The realities are these These debts are due to the Government of the United States; ..that Government is a representative Government controlled by public opinion > 8,. an effective public opinion in favour of reduction or remission must be creat-* ed on one of two grounds: (a) Either the justification of economics as being in the self-interest of our people; or (b) a justification on moral grounds as being an act of generous treatment due to those formerly associated with us in a great world war. It is clear to-day that there is no general public tion on either of theee grounds. THE ECONOMIC ARGUMENT. Discussing the economio argument, Mr Barnes said ths Amerioan people have been told for three years that their own prosperity depended upon the markets ot a restored Europe, and that these would be impassible to restore without the elimination of this international financial menace. This is probably ultimately true, but, so the evidence of actual trade development has not sustained this contention. Judged by all the measures of a prosperous industry America is to-day possessed at home of a. substantial prosperity. Within a sinSla year, from a condition, of four milloh unemployed, America has emerged to ‘ a condition of full employment. This present era of prosperous trade at home may be pvrely accidental, but it is, to-di, the visible evidence that our indqstnes are ndt languishing under the wSght of an Allied debt Therefore, on the ground of economics alone, the g present condition of American industry . is not such as to crystallise at this; time ...» public opinion favourable to their re- , mission. AN HONEST STAND ABB. As to the moral ground, the difficulties are even more real. America believes that the prime obligation-of ■Government-is to. maintain an. honest standard of ’value. America realises, therefore, that a deliberately depreciated 'currency is a dishonest and immoral process whioh wrecks ■ 'the industry of a .country and destroys the individual incentive to effort. "When we weigh the course of European Governments since the Armistice we find that, in the polioies of Government and in the conduct of industry, violence is done to the most profound convictions of out people,*’ Mr Barnes declares. "Amerioa is puxaled and bewildered when in .Europe, where are most needed the profound understanding of individual human impulse and a sturdy stimulation /of that impulse in the interest of aggregate recovery, there is shown apparently the most reckless yielding to expediency in measures -which our . whole national experience telle us lead to suspended or delayed recovery, or oven to utter social demoralisation. . "Payment from national treasuries of unemployment doles that put a premium on idleness and non-productivity carry no : appeal to American&aqimsKm sense, eyyn n with full, knowledfjnlptthe difficulties » which the reahsoiptieSforreleased armies may present. "Factories turned over-with the consent of Government against the will ot the owners to rebellions workmen for a fantastio experiment that ends inevitably in failure carry no conviction to onr people as a. proper function of constituted authority. "International trade agreements with Bussia, made with the colour of an effort to precede the entrance of onr own people into trade relations, affront onr own policy, based on a national' conviction that trade cannot exist without both production and just? laws, nqd that Russia’s policy of Communism;; has destroyed, nro- * ductionand violated'lsrcred- human rights. “ ‘ NATIONAL ANIMOSmEB. „ "Trade barriers erected by national animosities seem to ns to be- so fraught with the destruction {of commence, on which employment must rest, that yir confidence is lessened in Governments which .create and maintain these barriers. "Governments dominated by political groups frankly devoted to the interests of minor aeotaona of their people convey no promise to ua of broad, sound, national policies. “Labour parties, permanently in poli- - tics, speak to us of the acoeptanoe of a - rigid caste social structure .that implies a closed door to opportunity and advancement, which violates a fundamental tenet > of onr own social convictions. "Streams of emission of paper tokems whioh are a Government's promise to pay. issued without maturity date and without provision for redemption, or indeed without intention to redeem, seem to ns ths height of destructive immorality of government. "Public services assumed by Governments, dhch as transportation, telegraphs and telephones, and others, the field of whioh in Amerioa is recognised ae functioning best under private ownership and private operation, loaded with armies of dependents, income and outgo disregarded, and the national deficits thus created met by further emission of dishonest paper inflation, oarry no assurances of ultimate solvency. "National budgets unbalanced, with large expenditures for non-productive armaments which offend both onr business sense and moral sense, are difficult to »to ns as a necessity in the eollec"reparations. when other methods are successively refected. THE CASE OF GERMANY. "Amerioa subscribes without reservation to the principle that Germany must pay in reparation the last dollar which the productivity of her people can create, but our business sense and onr common sense tell ns that the problem of reparation is a problem for men trained in the economics of large business. and not solely for diplomats and politicians. Yet, when the problem is examined, as was done so hopefully a few short months ago by the leading business talent of the world, their effort is controlled, limited, and frustrated by the will of men in political authority. Even France, heroio France, imperishably seated m the admiration of onr people, has wounded Amerioa sorely the past few months. A world conference ’~ on naval disarmament, which accomplished much, and promised more in hopefulness for similar treatment for the larger land armament problem, receives a grudging assent in a treaty yet unratifted by her Assembly. "Shook after shock to tbs processes of overseas trade and international finance follow repeated crises in the relation between the two great Allies. A. great moral conviction of our people that the Turk belongs not to Europe is profoundly shocked by the demonstration that the restoration of the Tart's foothold in Europe is largely due to France's encouragement to-day" After discussing the evidence upon which Americans "rate Great Britain as ultimately able to meet the obligations of the Empire, no matter how etudendons these sums may be," Mr Barnes says in conclusion: —’"{Public opinion after all will govern the national treatment ot these national obligations. If Allied debts are to bo reduced or remitted .because their payment would, be disastrous to our own industry, then it would seem regrettable that the conviction of America can only be secured by waiting the demonstration of a disorganised industry. . , , . , No conviction in America will

support a remission in sheer national generosity unless it is baaed on a demonstration that the proceeds of that generosity will not he wasted in inefficiency add extravagance, nor in social experimentation which we know to be destructive of a people's productive Impulse." .