TO PAY IN GOLD

Taranaki Daily News, 13 December 1932, Page 7

TO PAY IN GOLD

BRITISH REPLY TO STATES * REGRET AT ITS ATTITUDE REASONS FOR THE DECISION , FACILITATING DISCUSSION Is U • W ~ .. • FRANCE ALSO WILL PAY British Wireless. Rugby, Dec. 11. .“His Majesty’s Government remains convinced that no solution other than suspension would obviate the difficulties of effecting the transfer of war debt payments, and therefore notes with profound regret that the United States has decided not to recommend this solution to Congress,” says a further British Note" addressed to’ the United States todayA--■’>■ ■■ “In view of this decision His Majesty s Government has determined to make payment of the amount due on December 15, but is convinced that the system of inter-Governmental war debtpayments, as it existed prior to President I Hoover’s moratorium on June 20, 1931, cannot be revived without disaster. ‘ln the view of His Majesty’s Government, therefore, the payment to be made on December 15 is not to be regarded as a resumption of the annual payments contemplated by the existing agreement. It is-made because there is not time for discussion of that agreement and because the United States has expressed the opinion that such a payment would greatly increase the prospects of a satisfactory approach' to the whole- question. “The British Government proposes to treat the payment of December 15 as a capital payment, of which account should be taken in any final settlement, and it is making to effect this payment in gold as being the least prejudicial of the methods open to it. This procedure must obviously be exceptional and abnormal, land His Majesty’s Government desires to stress the importance *of an early exchange of Views with the object of concluding the proposed disctission before June next’ in order to obviate the risk of a general breakdown of the existing inter-Governmental agreements.” . ' FRENCH SOLDIERS INCENSED. A Paris message states that Cabinet has decided to‘pay the debt instalment of 19,000,000 dollars due on December 15 with a reservation, which is being, announced to-morrow.' The Cabinet unanimously supports-M. Herriot, ‘ but the decision has antagonised a large section of the public. Despite police precautions 6000 ex-service-meh marched from a protest meeting to the Qua! d’Orsay while Cabinet was sitting. The police scattered the demonstrators,’ but hundreds reached the front door, shouting: “Not one cent for America.”'"' . The police will strongly guard the Chamber of Deputies to-morrow when M. Herriot submits his proposals. His ' opponents include the Royalist newspaper Action Francaise, which describes it as a dishonourable payment and urges the citizens to go to Parliament as a. protest. . The Sim representative says that Lon--1 don is becoming increasingly dubious of the wisdom of Britain paying the war "debt ihitilpient.' 1 . c.-- -- : The Investors’ Chronicle declares that payment in gold would be a* profound mistake in view of the Government’s contention that the gold reserves are unable to stand the strain. ' . . The Economist repudiates orthodoxy and‘advises default, contending that this is inevitable sooner or later. * “If it is a crime in chilly December it is equally base in palmy June,” says the paper. ‘“But a ; contract ceases to bind when the contemplated conditions are not realised, and there is no shame if a contract is broken by a force majeure. Nobody expected the catastrophic decline in trade prices. * It "is fantastic to suggest that if Britain cut the war debt tangle she would precipiate the wholesale repudiation of commercial ’ obligations, because these: stand in quite a different category. The world must not suffer 'by Britain’s fatal policy of doing the right thing too late.” .

-Sir Arthur Salter, thb famous econo-

mist, addressing the National Peace Council .conference, said that the European creditors had commuted Germany’s remaining liability in a way which would never, .involve an annual payment by Germany of more than about one-tenth of what was required by the Young Plan. . That was not altruism but enlightened self-interest. He was sure that if America acted similarly it would also in the balance prove, immensely to the advantage of the whole world and herself; but if the people in Britain would look at the- position coolly and sympathetically they should at least understand, though they might regret, America’s reluctance.