DEBT SITUATION

Wairarapa Daily Times, 20 January 1932, Page 5

DEBT SITUATION

MORATORIUM RENEWAL FRENCH MORE REASONABLE. Press Association Electric Telegraph—Copyright LONDON, Tuesday. According to a semi-official statement issued in Paris, Britain and France are on the point of an. agreement regarding tlie desirability of the renewal of the moratorium to Germany for six or twelve months from its expiry in July. The feeling is strengthening that a definite solution of the problem is not obtainable at present, especially in view of the impending elections in France, Germany and the United States. Naturally, America’s debtors, who are also creditors of Germany, will jointly request identical treatment from the United States if a diplomatic agreement is reached on these lines and the Lausanne Conference will become superfluous or might be attended by experts only. M. Laval, the French Premier, yesterday had a conference with Herr Hoesch, German Ambassador, it is believed, with a view to securing Germany’s assent to this solution. It' is stated in several quarters that Mr Ramsay MacDonald may not go to Lausanne, partly owing to the diminished importance of the conference and partly to pressure of home affairs. OUTBURST FROM HITLER. DR. BRUENING ATTACKED. BERLIN, Tuesday. Herr Hitler, in a memorandum explaining his refusal to agree the prolongation of President von Hindenberg’s term by vote of the Reichstag, attacks Dr. Bruening (German Chancellor) and argues that his resignation has reduced Germany to insolvency and international impotence. AMERICAN ATTITUDE. LIBERAL OFFER UNLIKELY. WASHINGTON, Monday. The assertion by Dr. Bruening, Germany’s Chancellor, that his country is unable to make further reparations payments is viewed here as having been promoted by political conditions in Germany. Apparently it came as no great surprise to officials, since it had been assumed that such a declaration would be made at the Lausanne conference, if not before. There is little indication that the probable cessation of German reparations payments would alter the opposition of Congress to the cancellation or reduction of European debts to the United States.

The serious consequences of a general default are recognised, but, nevertheless, it appears that the general disposition is to let the European nations default if they must rather than to have the country make-another gesture of “liberality” toward Luiope. It is contended, however, that a reparations default by Germany does not necessarily mean a default by all the nations in their war debt payments.

The former Ambassador to Germany, Mr. J W. Gerard, asserted that the tremendous tax burden which has fallen upon Europe makes it seem unlikely that there will be any further payments of war debts or reparations. “The great thing wo must guard against is excessive taxation,” he added.

Mr. Walter Lippmann, prominent journalist and editor, in his 'column in. the “New York Herald-Tribune,” asserts: “Dr. Bruening has taken a step which he cannot retrace. There can be no further cpiestion that Germany has renounced the Young Flan and the reparations clauses of the Treaty of Versailles.’

“ German credit is in such a state that it can no longer be as much injured by repudiating reparations as it can by continuing to pay them.”

FRENCH COMPLAINT. FACTS NOT FACED. (Received Wednesday, 12.10 p.m.) PARIS, Tuesday. M. Laval’s declaration, marking the appearance of the new Ministry, asserted that the cancellation of war debts and reparations was a panacea without penitence, emanating from an imaginative theorist, who had not faced the facts. France would not accept solutions which were inadequate to solve the crisis and striking at her essential interests and rights. She had to fulfill the duty of probity towards the generation surviving the war. She would sacrifice no credit without corresponding remission of her own debts. She had also the duty of prudence towards future generations. By subordinating agreement to justly balance the conditions of production the existence of such a balance would be broken if, after the crisis, disproportionate fiscal financial burdens handicapped France in international competition. France’s policy was as defined in the memorandum of loth. July: