The Christchurch Star PUBLISHED BY New Zealand Newspapers Ltd. MONDAY, JUNE 22, 1931. MR HOOVER’S OFFER.

Star (Christchurch), Volume XLIV, Issue 146, 22 June 1931, Page 6

The Christchurch Star PUBLISHED BY New Zealand Newspapers Ltd.

MONDAY, JUNE 22, 1931. MR HOOVER’S OFFER.

Gloucester Street and Cathedral Square CHRISTCHU RCH NEW ZEALAND. Leaden RiprauluiTNi R. 6. BRETT & SON HD* BRIDGE HOUSE. 30/34 NEW BRIDGE STREET LONDON. E.CA.

' 1 'HE American Government’s offer of a postponement for one year of all payments on account of inter-governmental debts, reparations and relief debts is intended, clearly, to save Germany from a financial catastrophe which is said to be not a matter of months or weeks but of days. British comment, inevitably, is favourable to this very splendid gesture, which would relieve the world’s economic strain at a period when that is an urgent necessity. The difficulty seems to be that unless France falls into line the American offer cannot be given effect to, and as France’s reparation payments are not the half of what she receives, the occasion demands a measure of selfsacrifice to which she will have difficulty in reconciling herself. That much is already evident in French cotnment this morning. On the other hand a year’s moratorium might be infinitely better for France than a German default, and that this is a contingency is already indicated by Mr Hoover’s somewhat remarkable concession that America might favour a reduction in debts if she was convinced that the debtors lacked the capacity to pay in full. One cannot be too sanguine at the moment regarding the adoption of Mr Hoover’s proposal. It all depends on the state of German finance and the statesmanship of those who have to make a decision for their respective countries. The most interesting comment at the moment is the expression of opinion that when America feels the benefit which will result from a moratorium, she will find it difficult to reimpose repayments. That, indeed, is the belief behind the agitation for a reduction in the interest rate of Britain’s indebtedness to America. The United States to-day is the world’s Shylock. When Mr Lloyd George invited the American Government to cancel the £2,060,000,000 owed to her by the Allies if the United States would cancel Britain’s debt of £935,000,000, America’s refusal, in the view of many economists laid the foundations for the financial disaster which has engulfed the world, and from which America herself has not been sheltered.

LANCASHIRE’S PROBLEM. ' I 'HAT HUNDREDS of tliousands of men and women in England unknowingly wear Japanese underclothing and eat from Japanese tablecloths, as we are told in a cablegram to-day, is due not to “ dumping ” in the accepted sense of that term, but to the cheapness of foreign production, stimulated by the installation of modern machinery, in which one Japanese does the work of twenty or thirty British operatives. Ever since the war, Lancashire’s share of world trade has diminished, and the industry, far from facing the facts, has simply waited for something to turn up. It was at one time claimed that with cheap raw material the industry would revive, but cotton has slumped to almost record low levels, and no improvement is in sight. In 1912 Lancashire produced 8000 million linear yards, and last year only 4000 millions. In 1913 Britain held two-thirds of the cotton trade of the world and Japan 3 per cent, but in 1929 Britain’s share had fallen to 45 per cent and Japan’s had increased to 17 per cent. The Cotton Mission to the Far East reported that at every stage Japan had an advantage in costs, and unless Britain was to lose her export trade altogether, something drastic would have to be done. Lancashire now admits that she possesses no advantage even in marketing, and that the only way to industrial salvation is by an all-round reduction of production costs, involving wages, and the wholesale scrapping of obsolete and unnecessary plant.