THE OTAGO DAILY TIMES SATURDAY, AUGUST 5. 1922. THE WAR DEBTS PROBLEM.

Otago Daily Times, Issue 18625, 5 August 1922, Page 6

THE OTAGO DAILY TIMES SATURDAY, AUGUST 5. 1922. THE WAR DEBTS PROBLEM.

If the British Government’s Note respecting inter-Allied indebtedness has achieved nothing more it has provided material for controversial discussion which has been promptly seized upon by the press on both sides of the Channel and in the United States. While the comment of the London papers is on the whole favourable to views expressed* 'the Note seems to have been accepted by the Paris journals as furnishing just another opportunity for recrimination against British policy. It is to be noted that in the view of the Federation of British Indus, tries the Earl of Balfour’s suggestions go too far in a direction that would involve Great Britain in' further sacrifices which she is not able to make. That in itself supplies an effective reflection- on the French cry that Great Britain is bent on obtaining all possible advantages for herself. It is, however, only too clear, that the British Government is much external sympathy with its proposals. The American: administrative attitude is not encouraging,. and upon it almoet xeverything depends. The British Government is' prepared to have all. interAllied indebtedness written off, and is frank in saying so. And its proposals are really honourable to it, for inasmuch as the indebtedness of Great Britain to the United States is less than the indebtedness of France and other European States to Great Britain, the Mother Country stands to lose more than she would gain by the transaction, apart altogether from the fact of her. willingness to forego her share of the German reparations. It has been left to the hypersensitive French mind to discover that the British Government is unreasonable in pointing out that, this general annulment being impossible without the consent of the American Government, eat Britain must look to her continental debtors to make good their indebtedness to her to at least the extent of what she herself owes the United States. Loans were made and great war debts incurred, as the British Note points out, for the achievement of a great common purpose —a purpose which was in the main accomplished. And it is the British view, the only sane view possible, that it is for the nations to make commqn cause in getting rid of the ills which the war has left in its train.

The solution of the problem of European stabilisation is dependent upon the solution of the problem of the international war debts. It is reasonable to suppose that the adoption of the British proposal for a general cancellation would profoundly contribute to the restoration of normality in respect <to foreign exchange difficulties. If the official attitude at Washington is not helpful at the present juncture, there is a chance that recognition of the interests of American industry may bring about some modification of the judgment of the United States. There is a disposition in America to emphasise the argument that the war debts represent the only hold which the financially sound nations have upon the unsound, and that these obligations ought not to be remitted as long as Europe is indulging in wild orgies of expenditure. A recent utterance in London by Mr Irving T. Bush, President of the New York Chamber, of Commerce, is of interest. Mr Bush urged that Great Britain and America were really in theSame boat. They were, he said, the creditor countries of the world, and all other Allied nations were indebted to one or both of them. He suggested that British and Americans ought not to be sitting on opposite sides of the table, discussing British debts to the United States, but that it was their duty to sit- side by side and demand that other countries should give some clear evidence of their being willing to balance their budgets, to exercise thrift, and to stop piling up armaments and i ursuing a madcap policy which both Great Britain and America condemned. Then when these countries showed their will to reduce expenditure, the joint creditors should be willing to step in and make easier terms. May not the British Note be regarded as a not ineffective reminder to France and other continental nations of obligations which they have been making no attempt to face, as well as of important.

objectives—tho trade and peace of Europe—which they are making no serious endeavour to promote? The French view ‘of the British Note respecting in ter-Allied indebtedness seems to be coloured, like all the French views oh the European situation, by the attitude of the nation in relation to German reparations. France is apprehensive «f designs to weaken, her hold on 6e?» many. !