Washington, May 17.
'The attitude of the' American administration on those interrelated subjects of International. interest—debis and tariffs—is far more "nationalistic" now than it was year ago.
During his election campaign the President took the line that tants mit the expansion of American trade 04 lowered, not only to per which had been restricted by the high protective tariff policies of his Republican opponents, but also. 10 enable foreign nations to pay their war-debts in the only practicable way—in goods. Given a rational tariff Dolicy, the President-to-be told the country, these debt payments will present' no aiMeulties, Had the President continued to talk in this way during the past year, continued to emphasize the necessity of receiving foreign goods if foreign debts were to be collected, continued to acknowledge that the tariff wall erected by the Republi-ans was so high that the top bricks should be knocked off immediately then he would. have been confronted by a public opinion which would have been prepared to accept reasonable settlement of th debts and. a more far-reaching measure of tariff reform. Instead tariff measure has been passed which says in effect to the world, "If you Femove a brick from your wall we'll ake one from ours" but "does not take into consideration the fact that the other walls may much lower for the debts there is no possibility getting Congressional consent to any new settlement which is not ten times as large as Great Britain who willy nilly acts as spo} for all debtors would desire. "While Britain thinks in terms of $200,000,000, Congress thinks in terms of $2,000,000,000, fand then wonders if {t is not betray: ing the American taxpayer.
New Angles on Debt Handling, If you suggest to an intelligent American (one, that is to say, Who alized that the last word on the debt problem was not spoken when id "they hired the money didn't they?) thatthe President has led to give the country proper Jeadership on the debt question and the real difeulties of the will in all probability should he? "Isn't that your Job?" The conversation would then Proceed on some such lines as this Q. "But we (assuming the inter: locator is British) sent you a war debt note over a year ago which presented our ease "with Unanswerable 'A. "And at interminable length. Livery trained economist read it with satisfaction because it confirmed his own views, but it went completely over everybody else's head. I've not met a member of Congress yet who'd admit he'd read it And after you'd sent the note you made no further efforts to reach American opinion."
"But our Statesmen have frequently made speeches.
'A. "It would have been much better it they hadn't. "They discuss" the matter with such an irritating alr of condescension. Protesting. that America shouldn't be paid for its own good sounds just as hypocritical a schoolmaster prefacing a caning with the remark This will hurt me as much as it hurts you" When a dozen American states (as you will no doubt remind me soon) defaulted to your people, they at least didn't pretend that they did it for your ood."
Q. "Well, what ought we to have done?"
'A. "Dramatized the issue so that the' dimculties would have been forced on peoples' attention. For example, you could have said to us: Your destroyers are out of date. 'Suppose we build and send you five of these ships a year for a fixed period. We don't mind how strong your navy is. We know weill never: ght each other. "If we can pay elf part of our debt in that way we'd be only too pleased.' The offer would hho doubt have been refused; but would have made a hit with the public, and the onus of refusal would have been on us. "You might have made similar offers to deliver rubber, tin or nickel. In fact that has been suggested by men such as Senator Harrison."
"But Administration oMeials, when sounded out, haven't given much encouragement to such plane.
'A. "All the more reason why you should "have publicly announced them. You could have been exceedingly generous knowing yowd not be called upon to full the promise. 'The object would not be to solve the debt problem so much as to dram. Uze one of the diMiculties, that of transfer, and throw part of the moral blame for the breakdown of the debt agreement on us. As it is you must bear the whole stigma' of default."
Q. "But surely by making a token payment.
'A. "You burned a penny candle to offset one of the economic deadly sins. True, it set you apart from the unabashed sinners for awhile; Dut really between ourselves you might 'a5 well try to compute. virginity on percentage basis. "Most. people considered a token payment as a pledge to pay in full when times are better and now hard" times are Q. "Wait a minute. Our taxes are still twice as high as yours..."
'A. "I was merely giving you te Impression left on mast of us by the welcome which your. press" and politicians gave your last budget. Now if the Chancellor of the Ex-Chequer had said in effect to the British taxpayer: 'In the past we chastised you with scorpions. Now I am able to relieve to some extent Your intolerable burden and only chastise you with whips' you would have deprived Senator" Johnson the pleasure of lashing himself into a fury that a country which boasts to the world that its financial position better than that of any other country" should still refuse to pay its full debt "But a budget surplus is beside the point, "You must admit that the only practicable way to pay a debt in goods oF services A. "You didn't take quite the same view when reparations payments tu kind were in question. In fact, 1 4geem to remember that while France, for example, would have been pre: ared to accept German coal in payment, you strenuously objected' because it would harm the British coal market. Can you blame us for taking a similar point of view?"
Q. (A little feebly now) "Well what can one do'
'A. "Default Uke a man and get it over with"
Q. "But the effect over here would be extremely unpleasant.'
'A. "So is having a tooth pulled, Dut the after effects "soon pass while if the tooth is left in, the toothache will continue."
Q. "But then we would in the future come under the penalties of the Johnson Act'
'A. "You should thank whatever Gods there be for that. When you consider what a mess government borrowing has got you into in the ast, will you ever want to run such a risk in tne future?"
Johnson Called "Iron Chancellor"
Hiram Johnson, in the opinion of most intelligent Americans, has made default inevitable. He is! being referred to round the capital as the Iron Chancellor." He has, in effect, cancelled the debts.
The powers delegated to the President to negotiate reciprocal tari treaties and. to. lower (or raise) American tariff rates 50 per ent. in order to do so offer very Little hope Yor the future.
The State Department, who will undertake the negotiations, will undoubtedly do the best they can, but even assuming the utmost willingness, the powers granted the President are not wide enough. This especially so in the case of ad valorem duties which with the general fall in prices have become Prohibitive. Moreover no single reduction can be made in the American tariff unless @ corresponding reduction is made by the. country with whom the agreement is being negotiated. That point was stressed time and again in the debates in the Senate. In this respect the present tariff policy is a definitely retrograde step. During the Presidential elections as mentioned above, the fact that the American tariff' was too high was stressed by Democratic speakers and the promise made that the Democrats would lower it and thus restore trade by making it possible for foreign goods to. be imported.
Since that time, however, the country has been excited to a high state of nationalistic feeling which was no doubt necessary to restore morale and secure adoption of some of the emergency measures but which now prevents other measures being put into execution to complete the task of recovery. Soon after the President entered the White House a tariff truce was proposed. Then at the
Text read from the printed page and cleaned; old type leaves the occasional error.