CANCELLATION OF DEBTS

Taranaki Daily News, 16 April 1932, Page 7

CANCELLATION OF DEBTS

GOVERNOR SMITH’S PLAN

VARIED OPINION EXPRESSED

REACTION IN THE PRESS

SERIOUS ATTENTION GIVEN

By Telegraph—Press Assn. —Copyright.

Reed. 7.10 p.m. New York, April 14. Governor Al Smith’s proposal to set off European war debts against payments for American exports has resulted in considerable reaction in the Press. A leader in the New York Sun suggests it is a potentially important economic proposal.

“The Imperial conference at Ottawa,” says the paper, “is likely to grant Australia and Canada a rich privilege for selling in England most of the wheat needed. As matters stand the American grower will be undersold in the British markets, but they would be beaten if an export subsidy such as Mr. Smith suggests lowered the price in England by 25 per cent, without reducing the American farmers’ return.”

The paper outlines the various amounts of reduction accruable for the largest debtors, indicating that Mr. Smith has apparently studied the question in view of previous trade reports. The New York Times without accepting the proposal outright comments: “It may prove to have ultimate value, but its great immediate value is the blunt assertion that we have been dealing with the question in a way that is bad for ourselves as well as for the rest of the world.” The New York Herald-Tribune characterises the proposals as ‘exceedingly difficult to defend from any economic angle.” However, the paper commends Mr° Smith’s courage in discussing the issue candidly and suggests that it “might be an ingenious, political device to make the cancellation of debts palatable to American voters.” Propounding his scheme yesterday Mr. Smith said: “Let us say. to the nations of Europe who owe us money “that we will forget about it for 20 years, and not only will we do that but we will write off as paid each year 25. per cent, of the gross value of American products which they buy from us. This is in effect, if a nation purchases 100,000,000 dollars worth of our cotton we will forget about 25,000,000 dollars of its indebtedness, and the same for wheat, fruit, tobacco, or any of our manufactured products.” Mr. Smith pictured the United States as “clamouring for the paymeht of debts which we know cannot be paid.”