June 6.
Great Britain finds it necessary not to pay anything to the United States in June, and, as a result, the §262,000,000 for which an ac~ count was rendered by Washington will remain unpaid for the present. No token payment is being offered and the whole issue of Britain's indebtedness to the United States has been put fairly and squarely up to the government of that nation. It is not, it should be emphasized, a repudiation of indebtedness but a slate~ ment which means in effect that Until the matter can be discussed again. and a better settlement greed upon the question of payment must remain in abeyance. Had it not been for the Johnson Bill which imposes penalties on defaulting nations, and declares that the tenderer of @ token payment is in default, it is possible that Britain would again have made a token payment, but if. whether she made one of not, she would, just the same, be regarded as defaulter, it was obviously the wisest thing to do to make none at all, for the stigma would be no blacker and certainly cheaper by the amount which would not change hands.- Nevertheless it is to be greatly regretted that the British Government have found themselves obliged to take this step., It has deliberately gone into default, because there was no al= ternative except a payment as onerous to the debtor as its receipt would be to the creditor; but thereby she set the seal of tacit approval on the defaults of other nations, to the United States and herself, The resume of the lengthy British Note on the sub ject indicates that Britain has put her case forward with no_ little dignity and a telling reference to the real facts of the situation. The world cannot go back to the condi-ling before the eco-
full payments would have the effect Yet resumption of of necessitating the service of demands for corresponding payments on all countries indebted to Britain and would in the long run result the re-establishment of the factors which contributed so largely to the difficulties from which the world has not even now emerged. Such a procedure, it was pointed out, would throw a bombshell into the European arena, would have financial and economic repercus~ sions in all the five Continents and would postpone indefinitely the chances of world recovery.
It is by no means uninteresting to consider the position with regard to war debts and the behaviour of the creditor nations in the matter.
At the end of the War reparations Payments due from Germany to the Alllies amounted to £6,600,000,000. Inter-Allied debts and debts owed by the Allies to the United States amounted to £8062,000,000: the total Allied debt to the United States was £ 1,949,600,000, while between 1917 and 1920 they had bought and paid for no less than £2,379,400,000 in goods. The German debt was repeatedly scaled down, and up to the time of the Lausanne Conference that country hac paid £625,000,000 to the Allies and this sum with the exception of 100,000,000, retained by France reparations, was. in due course turned over to the United States.
addition to their share of this sum, British taxpayers have paid further £200,000,000 to the United States. When it came toa sealing down of inter-Allied debts the United States Treasury demanded from Britain, annuities amounting to £ 757,000,000, involve Jing a remission of £163,400,000. while Great Britain in her dealings with France remitted £345, 000,000 out of the—£600,000,000 which was owing. Indeed it may be safely said that Britain scaled down the obligations of the rest of the Allies to such an extent that she could only expect to receive ery tle more than she had in fora to pay to the United States. That wes the position when the Lausanne Conference decided. that reparations payments should come ban end. and that inter-sovernmental debts should also be wiped ut providing that some satisfactory arrangement. could te made with the United States. There 1s no intention to discuss the great difer-face between the way in which America and the European coun-ides regarded this very Important question of indebtedness. Nor M'desirable to suggest which was the more reasonable view to cake of the matter.
Great Britain by her actions clearly indicated that she consider-td the collection of all that. was wing to her impossible. Probably fad she realized at the time the alsastrous effect that the insistence upon the full recovery of sums ting would have upon the eco-femic condition "of the. world st large, the adjustments which she made, generous a they undoubted were, would "have been even treater" In any event it was Tee agnized that 20 Yang as a country had to depend for a great deal of ie prosperity upon foreign trade everything possible had to be done fo see that potential customers Should Keep their heads above financial high water. Tt was clearly seen. that to force debtors Into bankruptey not only banished ior ever any chance of obtaining the money' owed, but wiped "out all posslity of the continuance of that trade the diminution of which irone of the gravest ills from which the world at present suffers I the government at Washington comprehends the point, It is obwious that American public opinion doesn't. Tu that it is not to. be blamed, for It is a point which can only. be readily understood. by a country which depends upon" is export trade for the greater por tion of its commerce, and that is nat at present the casein which the United States finds itsd. That being so, it is probably just as well that matters: have been' brought issue by the action which Great Britain tas so unwillingly" taken. Wig a humiliating position for a treat country to" be in, but it is fot_so blameworthy as. would apper at frst blush. Britain hes done everything powible to make the settlement of debis as easy. possible for her debtors. She. has teen denied those payments which would in turn have made It pos-Sible to render to the United States the dues to which it is rightfully entitled, and the time has. come When itis imperative that the Whole question should be reopened, it not to go as far as the conferees at Lausanne would have liked 0 fat leat to bring about readjust nents which would be well within the ability of the debtor nations to meet. The" whole problem is a fave and dificult one. Int is not {capable of solution, and probably the best means of bringing about a seedy. settlement. of the whole matter is just such an action as that Which Great Britain has taken.
Text read from the printed page and cleaned; old type leaves the occasional error.