AMBRICAN politicians and American financiers appear to be decidedly at variance. Che pheno-ure non is not confined to America, the doers of the world often having cause to marvel at the ways of the talkers. Both the new tariff and in a minor degree the American Government's attitude in respect of reparations and war debts are being criticize ed by the men who really understand the ways of money. When we read of the Senate sitting up all night long to clap on new import duties in batches of hundreds, we may expect something rather out of the way, and really the Senate, which has not succeeded in gaining much reputation for wisdom abroad and still less, we are told, in America itself, appears to have surpassed itself. We quoted the other day from a New York financial review one very rude description of the tariff; and on the same day Mr. Lamont, a* financier' of international reputation, contempt tously dismissed it as ''protecting industries which did not require protection and cutting off important foreign markets from manufacturers and farmers."
Without the full measure we are not in a position to reckon exactly what the incidence of the new tariff will mean. It was estimated that, if all the duties: imposed by the Senate were enforced, the expense to American consumers would be not less than $3,000,000,000 annually, but in practice it is agreed that game mitigation of this charge is inevitable. But the meaning of one provision, as recently telegraphed out from the Department of Commerce, is quite plain "A distinguishing feature of the new tariff (we read) is the provision for flexible adjustment of duties changing with needs and conditions of competition. Broad powers are granted to the President to change classification, increase or decrease basic duties within a range of 50 per cent. to equalize production costs in the principal competing countries. The President is authorized to impose additional duties to limit of 50 per cent. ad valorem in exceptional cases and even to exclude products of particular countries upon proof of unfair methods of competition injurious to American industry, or of foreign practices discriminating in any form against American commerce or shipping in comparison with other countries. He is also authorized to}impose countervailing duties to offset foreign bounties or preferential treatment of exports detrimental to the United States.
It is impossible to recall a provision so monstrous in the peacetime legislation of any Great Power. Its practical effect, if We can suppose that it will ever seriously be enforced, would be to give the United States Government power to interfere at any moment in the internal business and commercial practice of any other country, on a plea of unfair competition, of which unfairness that Government is to be its own judge. It is not a question merely of protecting industries which need no protection, but of rendering all business with America impossible. When the famous Jones Bill was being discussed at Washington, the shipping men and merchants of Seattle had their eyes opened by a foreign visitor to the consequences that it would entail in the way of retaliation abroad; and it was in no small measure due to Seattle's opposition that the Bill was dropped. In the same way we may expect that the flexible adjustment'' clause of the new tariff will quietly lapse into the region of dead letters. Its attractiveness, to a certain type of mind, does not affect its utter impossibility.
Turning to the question of reparations and war debts, we are on delicate ground. A view very commonly held is that the debts contracted by the Allies in America between the date of her declaring war and that of her: armies being ready for -the field should be put in a different category to debts contracted before or after that period. They were, to a large extent, not so much loans as credits for munitions fired off by the Allies in the common cause, in which America was concerned, and as such, people hold, they formed America's contribution to the war she had declared, virtually the only way in which she was then capable' of~ waging it. But this view has never been advanced by officials. The _British Government has never asked for any revision of its debt to America and is not likely to do so. Whatever delay there may have been in British payments to America has been rather due. to America's fears of upsetting her own markets by receiving more gold than to inability, still less to reluctance, on Great Britain's part to pay. The case of the other debtors, how-1 ever, is different, apart from the harm that may result from this enormous load of debt, all from one side to the other, to the recovery of the world at large. It is, therefore, extremely interesting to read Mr. Lamont's sharp admonition to Americans, to make up their minds to writing off such sums as can never be paid, and "'to quit fooling themselves'; while the resolution of the American Bankers' Conference reported in to-day's telegrams suggests that other leading financial minds in America are moving in the same direction. The attitude of Washington Treasury officials, as reported yesterday, in answer to Mr. Reginald McKenna's plea for concessions to debtor nations other than Britain, is not encouraging. But this merely prompts the reflexion that politicians in all countries make it very hard for decent folk to come to an understanding. in the long run, it is the financiers and business men who dictate policy and the outcome of the views beginning to be taken in America will be watched with keen interest.
Text read from the printed page and cleaned; old type leaves the occasional error.