Title: Alied debts : supplementary rebuttal notes
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Title: Alied debts : supplementary rebuttal notes
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Publication Date: December 1932
Copyright Date: 1932
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Affirm. SUPPLEMENTARY REBUTTAL NOTES Page 1
December 1, 1932

RESOLVED: THAT THE UNITED STATES SHOULD AGREE TO THE CANCELLATION
OF INTER-ALLIED WAR DEBTS

NOTE: The notes from the debtor nations to the United States
asking for an extension of the Moratorium, the discus-
sions of President Hoover with Governor Roosevelt and
leading Congressmen, and the replies of our government
to the European governments, have intensified the debt
discussion this month. There h's not been time for many
periodicals to publish new articles on the debt question
but all the leading newspapers have carried such articles.
This issue of our Supolementary Notes carries 11 the
official comment pertinent to the question, and the best
comments of leading papers and journalists. The data is
arranged in about the same order as in our regular Re-
buttal File.

#1. THE SATURDAY EVENING POST, November 5, 1'32. p.34-36
Trading in our War Debts by H. F. Hollis.
If, on the other hand, the demands for loans had not been
generously met, the war would have ended speedily and disastrous-
ly. The consequences resulting to our national pride, to say
nothing of our national purse; if we should be compelled to sue
for peace, and to ransom 2,000,000 American soldiers in France
at the hands of a victorious Germany, were not pleasant to
comtemnlate. A gentle reminder of that dire possibility was
wafted to the ears of our representatives in Paris on many a
night of July, 1918, through-the sound of cannon to the east--
the booming of the Kaiser's guns over on the Marne. It was
the time when the soldiers of France were so disheartened and
so war weary. It was the time when the Clemenceau government
was debating whether it would be necessary to transfer its seat
once more to Bordeaux, and when our Treasury representatives
were discussing whether it would be possible for America to
carry on if the Allies, or some Of them, should surrender.

#2. NEW YORK TIMES, November 20, 1932. Section 8, p.l.Charles
Mers.
Some of the miscellaneous expenditures were for silver. _
But it is.clear that the great bulk of the loans was spent in
the United States and that it went to buy American munitions,
American cotton, American grain, Amerioan tobacco and American
transportation.

#3. NEW YORK TIMES, November. 20, 1932. Section 8, p.l.Charles
Merz.
There is no questioning the fact that credits amounting to
more.than $3,000,000,000 were granted after the armistice. But
among the reasons why the United States continued to make loans
was a desire not only to assist Europe but to protect certain
American interests. On this ooyint it is useful to recall a now-
forgotten sequence of events.

The Debaters Information Bureau, 3 Horton Place, Portland,Maine








Page 2 SUPPLEiEiJTARY REBUTTAL NOTES Affirm.

When the war ended the British Government withdrew its
orders for the purchase of American foodstuffs at prevailing
wartime prices. As head of the United States Food Administra-
tion Herbert Hoover at once wrote to President Wilson explaining
how seriously American interests would be injured, by a cancella-
tion of these orders.
New loans were accordingly advanced to Euronean nations,
in part, though not in whole, for the purpose of postponing a
post-war price deflation in this country, particularly with re-
spect to prices of agricultural products.

#3. HAROLD G MOULTON and LEO PASVOLSKY.. War Debts and World
Prosperity;- 1932.
While there is no legal connection between the two sets
of obligations (debts and reparations) either.inherently or
as a result of accepted agreement, there is between them so
important an economic relationship that the legal aspects of
the problem have very little realistic significance.

#4. NEW YORK WORLD-TELEGRAM, November 25, 1932. p.27. Dr.:
Nicholas Murray Butler.
We have said that the debt payments--due to uo bore no re-
lation to the reparation payments to be made by Germany; but
they did.
The reason was that.unless the reparation payments were
made by Germany to its creditors those nations would not be
able to make the payments'that were due to us. 'Moreover, the
money with which to enable Germany to make her paymentss was
obtained for several years in large part, if not wholly, by
loans from the United States.
We are, therefore, in the ridiculous position of loaning
abroad the money with which to pay us debts owed from abroad.
When we cease to loan they must cease to pay. .The whole situa-
tion is one which reflects grievously upon our practical capacity
and our business sense.

#5. NATION 135:524. November 30, 1930. Maxwell S.Stewart.
As far back as 1919 the claims of the Allied Nations for
reparation were strongly influenced by the necessity of meeting
the war debts. The Dawes Plan and the Young-Plan were both drawn
up with the Ameriocan debt payments in mind,. while appended to
the latter was a protocol, signed by all except the United States,
Providing for a reduction of German reparations in case of adjust-
me'nt' of payments to the United States. More significant, of course,
is the actual financial connection.
War-debt payments have been made out of the receipts from
reparations, while reparation payments in turn.have'been made
possible b- large investments of American capital in Germany.

#6.' SATURDAY REVIEW (English), November 12, 1932.p.496.Editorial.
President Hoover made it certain- that never again would
Great Britain receive a penny from Germany on account of the war,
while continuing to insist on the inviolability in the future of
The Debaters Information Bureau. 3 Horton Place, Portland, Maine







SUPPLEMENTARY REBUTTAL NOTES


the past. Like the shells on whieh they were largely spent, these
loans were blown to pieces. They have produced nothing to repay
them, and they have left behind nothing but fresh complications
and perplexities.

#10. REVIEW OF REVIEWS, January 1933. p.32.Frank Simonds.''
There will be a common effort to persuade the American Congress
by arguments and diplomatic methods to agree to reopen the debt
debate. Failing that, there will be some more or less concerted
attempt through tariff and other devices to reduce purchases from
the United States and thus establish a favorable balance for Europe
in the transatlantic trade. Finally, failing any revision of the
ddbts, it is my judgment that even if France and Britain pay .on
December 15, that will be the end of debt*payments.,

#11. NEW YORK HERALD TRIBUNE,. December 28, 1932'.p.1 .Herald Tribune
Bureau. ,
War debt discussions for the life of the Hoover administration,
unless unforeseen developments occur, virtually were terminated to-
day when Paul Claudel, French Ambassador,: aqnd Henri 'L.Stimson,
Secretary of..State, agreed that a commencemeent of"'new, exchanges
'held out no hope.of accomplishing' a useful purpse.,- :

#12. REVIEW. .F REVIEWS- .January, 933 .p. 3,Frank: Simonds.
It almost goes without saying that Bri.tai' and France would
be .far more willing to bear the 6ost.s: pf repudiation in the United
States'than to reopen the reqarations.-,question in Europe.

#13. THE WALL STREET JOURNAL, December 22, 1932.p.5. Silas H.Strawn,
chariman of the 'Ameri'can committee of: the International Chamber of
Commerce,
If, we permit continuing def'aults.-in the war-debts, the whole
situation-.is fraught with the gravest danger.

#14-,. 'NATION. 135:r30, December 28, -19532.Editorial.
.The emphatic'British announcement that the United Kingdom will
not pay another cent untilthere i:s a complete reexamination of
the problem, together with the French default, .ill bring the matter
to the test. Long before the next: installment is due, .there must be
a 'final showdown if there is not to be default'all around, with
consequent, ercour'agement to.debtors all over'the world to refuse
to make payments. It is t'he i'atter prospect which is particularly
alarming to ,the world of finance. Once.you start a process of this
kind no one. can tell how completely the hbuse of cards'will tumble.
A little fellow on the other side'of the globe who-has, no claim
to consideration may readily sei'ze the opportunityy to declare for
himself a. perpetual moratorium 'and'.pointto France or some other
country as:his model.

#15. PORTLAND-(Me.) EVENING EXPRESS,-De.cember 2.,1032.p.0. The War
Debts, by Frederic J. Haskin..
Should England .default to 'theiUnited States h.er,whole bond
structure would depreciate in vaalue,, This would.be a-severe blow
to thousands of persons all "ovr the.-world. British finances long
have been the mos*tst-able.;in the world and for that. reason institu-
tion's; widows and orphans,'an-d'other, dependent entities have invested


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SUPPLEMENTARY REBUTTAL NOTES


in British consols. Approximately 22,000,000,000 of these bonds
are 'held outside Great Britain. Should default occur, the thousands
who depend on their incomes from this' source which never in many
generations has failed, would be added to the impoverished and, in
many cases the destitute of the world,

#16. NATION 135:630 December 28, 1932. Editorial.
Senator McKellar's bill, introduced into Congress on the fatal
December 15, to put a price of 5,000 upon any vixa granted to an
American desiring to visit one of the countries which have defaulted
on their payments to the United States is quite in keeping with
the sDirit of Congress and its entire approach to the debt problem.
By all means let us send these French rascals to Coventry; let us
boycott them thoroughly. That will be just the-way to convince them
of their error and induce them to pay us promptly, and generally
commend Congress to them as a group'of gentlemen, wise, calm and
self-controlled.. The mere publication of the proposal in Paris
will add fuel to the flamed of hatred between France and our own
nation already leaping high. And this was the Ally we exalted to
the skies in 19171 To this same France, the innocent, the chival-
rous, the noble, the bled-white;'we dedicated ourselves in eternal
friendship on--Flanders fields!

#17. PORTLAND EVENING EXPRESS, December 21, 1932. p.4. Charles P.
Stewart. Central Press Staff Writer.
To be sure, there is tlk in Washington of commercial reprisals
against France but just what they might be is something of a puzzle.
American tariff barriers already exclude French products from
the United States almost completely.
The hint that Private French investments here might be levied
on seems unlikely to meet with much favor.
American investments in France probably are larger today
than French investments in America. These investments are what
Rep. Britten has proposed taxing, in order to discourage further
purchase of French securities.

#18. NEW REPUBLIC, December. 28, 1932. p.174. Editorial.
Extremist opinion in the United States was all ready to.be severe
on Great Britain for asking even for reduction -of debts. Then France
defaulted, In order'to punish France, 'extremist opinion veered to
an inclination to deal leniently with Great Britain. The joke is
that by doing so we shall benefit France far more than'we should
be canceling her whole debt to us, or than-if France had not done
something to give England this preferential position. For the great-
er part of France's debt is owed to Great Britain, not to us. Great
Britain borrowed the money from us largely in order to lend to her
Allies. And any reduction we give to Great Britain.will, according
to the Balfour policy, be passed on. France therefore greatly bendk
fited herself by defaulting.

#19. LIBERTY, January 7, 1933. p.26. Jay Franklin. A New Deal in
War Debts.
The most we could do would be to let the debt payments pile up
in special accounts in the debtor countries and to use these
accounts to invest in local industries or to help American exports.


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SUPPLEMENTARY REBUTTAL NOTES


As this would give the American Government a mortgage in the
national. wealth of our debtors or control of their foreign trade,
it would be.dangerous and undesirable ..Imagine the row if, say,
the American Treasury agent in London foreclosed a mortgage on
some British factory!

#20. CHRISTIAN LEADER, December 17, 1932. p.1490. Richard R.Wood
Secretary of Friends Peace Committee. Philadelphia.
Insistence on payment---is likely to increase considerably
the danger that. the United States will be left without support in
withholding recognition from a settlement of-the Manchurian contro-
versy which we have publicly stated to be inadmissable. A most
humiliating or dangerous situation would then confront.this country.

#21. LIBERTY, January 7, 1933. p.26. Jay Franklin. A New Deal in
War Debts.
Our refusal to postpone the December payments led.to a. quick
shift at Geneva, where the. League of..Nations threw our. livanchurlan
policy into the scra. basket, withthe...support of Great.-ritain" ,our
chief debtor. .Score one for Europe! ..

#22. NEW REPUBLIC, December 28,. 1932.. p.174. Editorial.
France has been the principal obstacle to disarmament in Europe.
She is armed because her people.believe it necessary to be armed.
She would have liked to have the United States voluntarily reduce
or cancel the debt, but that concession would not mean enough to
her so that in exchange for it she, will suffer what her.people
believe to be national peril.. For there is. another way out of
paying debts; the Chamber has just taken.it,

#23. LIBERTY, January 7., 1933.p.27. Jay Franklin. A New Deal in
War Debts.
We should use our present position of control over their
foreign credit as a pawn in the great game of world politics. We
are worried--and rightly worried--over Japan in Manchuria. France
has shown a curiously friendly attitude toward Japan during the
latter's great lawless raid in Asia.- If we moderate our debt
agreement with France, there is no reason why the Prench should
not give more positive support to.peace and order in the Far.East,
The British Government has been drifting into an anti-American econ-
omic policy and .has recently been playing a peculiar game with
Japan. If we moderate our debt .agreement with the British,. there
are lots of petty disputes which they ought to settle: disputes
over consuls, over cruisers, over oil fields, over trading rights,
over commercial propaganda. .The British might also be expected
to reenforce peace in Asia.

#24. GUARANTY SURVEY. Guaranty Trust Company of New York, November
28, 1932, p.5..
Foreign governments .have already paid to the United States
about 25% of the amount they originallyborrowed; yet that 25%
has not been sufficient to cover current interest charges, with
the result that the principal still to be.paid exclusive of inter-
est, is $500,000,000-greater.,than the original amount of the debts,


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SUPPLEMENTARY REBUTTAL NOTES


#25. CHASE ECONOMIC BULLETIN, December 12, 1932. pages 4-5.
Beniamin M. Anderson, Economist, Chase National Bank of the City
of New York.
In the most important case of all, ability to.pay was not
seriously considered. Great Britain was too proud to raise that
question seriously. She funded her debt in full and asked consid-
eration merely on the rate of interest. With respect to the rate
of interest, she made her main argument on the ground that Britain's
historic credit standing entitled her to a moderate rate, 3-%, and
the main concession that she received in connection with difficult-
ies growing out of the war was' that the rate. was made 3 rather
than 3,% during the first 10 years. She counted on trade revival
to restore her old strength. It didn't come.

#26. NEW REPUBLIC, December 7, 1932 p.84. Editorial.
Acceptance.of the payment in English pounds rather than in
American dollars,...the..pounds not to be converted into dollars
until the transfer can'be, accomplished without danger to exchange
values, is in fact, an indefinite postponement of payment. Pounds
are not of the slightest use to the United States, unless they are
spent where British currency is valid.

#27. THE NEW YORK TIMES, .December 4, 1932, p.2. Prof.Jacob Viner,
University of, Chicago,
The British Government could borrow sufficient.gold from the
Bank of England .for a payment or two, but not more,.and not even
this without an impairment of her currency reserves, which most
Englishment would regard as dangerous and which. they would endeavor
to restore as quickly as possible. But the only means for such
restoration which would be likely to seem available would be further
increases of their tariff and further deflation of their price
levels.

#28. FOREIGN POLICY BULLETIN, December 9, 191'?. 1axwell S.Stewart.
There is reason to believe that the Administration and many
members of Congress are'disposed to deal with Great Britain more
leniently than with the other debtors.on account of its acknowledged
financial difficulties. 'The impracticality of .such a course,
however, is obvious. Not only is it manifestly impossible to de-
termine a debtor's capacity to pay with any reasonable degree of
accuracy but, once such an estimate has been made, it would con-
stantly have to be revised in the light of changing conditions.
Moreover, a display of favoritism at this time would unquestionably
cause serious political complications. Any discriminatory action
against France would---destroy thebasis for international coopera-
tion which was established at Lausanne.

#29. THE NEW YORK TIMES, December 15, 1932. p.16. Text-of the address
by Chancellor of the Exchequer Neville Chamberlain in the House of
Commons, December 14, 1932.
It would be useless to pretend that we can view with indiffer-
ence the loss of this huge quantity of gold, coming at the most in-
convenient season of the year, and certainly in circumstances quite
unexpected. It means a serious weakening of'the resources of the
Bank, and I think we may expect to see that reflected in some rise
in the very low rates which have prevailed for discounting bills.


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#30. CHASE ECONOMIC BULLETIN, 'December 12, 1932.p.10. Benjamin M.-
Anderson, Economist, Chase National Bank of the City of New York.
It is perfectly possible for a government to be poor when the
central bank of issue is full of gold. Our Federal Reserve Banks
today are overflowing with gold-and our government has a great
deficit. The same thing is true of France.

#31. THE NEW YORK TIMES, December 3, 1932, p.12; The text of the
French note on debts to the United States, delivered to Secretary
of State Stimson by Paul Claudel, French Ambassador, December 2,1932.
The inflow of gold to France which has taken place during the
past years was caused or rendered inevitable, in the last analysis,
by virtue of conditions existing throughout the world.
This gold does not in any sense belong to the French treasury.
It is not a source of permanent wealth for France. it is the guar-
antee for all the deposits made in France, whether by Frenchmen or
foreigners. Its normal redistribution, which is desirable, can only
follow a general recovery of confidence and the needs 'which will
follow such a recovery.

#32. THE NEW YORK TIMES, December 15, 1932. p.l.
The Polish Government, while reiterating'their acknowledgment
of their debt to the United States and their willingness to dis-
charge .,their obligation, must consider the effect if full payment
were made in gold of the j3.,302,980 due on Dec.15. Such a transfer
of gold at this time would diminish the gold cover of the currency
and might affect the freedom of gold remittances.
Faced with a double responsibility, not only to its creditor,
the United States, but also to the Polish people, who by their sac-
rifices,enabled the Polish currency to remain on the gold standard,
the Polish Government requested in their notes--first, that the
payment on Dec. 15 be postponed, and then, that the entire matter
of the debt owed by Poland to the United' states be reconsidered.

#33. CHASE ECONOMIC BULLETIN, December 12, 1932. pages 6-7. Benjamin
M. Anderson, Economist Chase National Bank of the City of New York.
The great primary source from which the outside world can earn
dollars is by sending us goods or performing services for us. The
biggest4 service element is entertaining our tourists, though reve-
nues from shipping and some other items are important. The shriv-
elling of these sources of dollars in 1932 as compared with the
period 1926-29 is altogether dramatic. With the decline in for-
eign trade, shipping receipts have shrivelled, tourist's expenditure's
are radically reduced, while imports into the United States during
the year 1932 have been cut to incredibly small' figures.

#34. NEW REPUBLIC, December 28, 1932.n.182.H.N.Brailsford.
The morals of Europe may be deplorable and capable of.vast
a-endment. You are right to point the finger of scorn at our arma-
ments, our tariffs, our old-world Lilliputian economic units. But
they have nothing to do with this case. If we all turned pacifists
and teetotalers and freetraders tomorrow, that would not help us to
pay our debts against this fatal balance of trade.


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#35, THE UNITED'STATES DAILY, December 14, 1932, p.8. Tax Relief
as Needed Impulse for Revival of Business, by Wilbur L. Cross,
Gove-nor of Connecticut.
It is pertinent to recallthat, after our War of Independence,
Great Britain set up a nearly prohibitive tariff against our profit-
able trade with the West Indies. What did:George Washington do
about it? In conjunction with Hamilton and Jefferson, he informed
the British government in no uncertain terms that, if her colonies
would not take our goods, we would be unable to pay our debts.

#36. THE NEW YORK TIIMES, December 2, 1932, p.1,2. The Text of the
British note on debts to the Unit:ed States, delivered to Secretary
of State Stimson, by Sir Ronald Lindsay, British Ambassador, Dec-
ember 1, 1932.
The creditors, in so far as they.have.refused acceptance of
payment in goods, have compelled their debtors to pay in gold. This
has led to a drain on the gold reserves of many.countries, and this
in turn has forced up the price of gold in terms'of commodities,
or, in other words, has forced down the price of commodities in
terms of gold currencies.
This fall in prices.has'caused widespread ruin to producers
in debtor and creditor countries alike and threatens disastrous so-
cial and political repercussions. It has seriously increased the
burden of commercial debts; but it has-rendered intolerable the
pecuniary burden 'of unproductive war debts.

#37. CHASE ECONOMIC BULLETIN, December 12, 1932 p..8. Benjamin M.
Anderson, Economist, Chase .National. Bank .of the.City.of New York.
Sterling is still the medium through which the msaor part of
Continental European payments are made to us, and sterling is the
medium by means of which the outside world generally buys the major
part of our cotton and other agricultural exports. It is absolute-
ly contract to the interest of the people of the United States to
have an unbearable burden put on sterling exchange. It is rather,
very definitely to the interest of the. people of the United States
to facilitate the restoration of sterling to a sound gold basis in
the interests of our export trade.

#38. CHASE ECONOMIC BULLETIN December 12, 1932. p.4. Benjamin M,
Anderson. Economist, Chase Lational Bank of the City. of New York.
The existence of these debts has been violently distrubing
Sto trade and credit at home .and abroad. The ,intergovernmental debt
fabric, including reparations, is one of the major causes that
brought about the crisis and the great depression. The unsettled
state of intergovernmental debts is one of the main causes that
perpetuates the depression. It is of no use to our budget or to
our taxpayers to collect 250.or 26Q million.dollars a year from
European debtors, even assuming that we could d6 it, when the
effort to make such collection perpetuates the disorder that has
pulled our tax receipts down by billions of dollars and has pulled
down our national income, including wages, by tens.of billions of
dollars.

#39. REVIEW OF REVIEWS, January, 1933. p.34.C.T.Revere.
Opposition to reconsideration of the debt problem comes chiefly


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from the agricultural districts of the South and West. In these
areas are 32 states south of the Potomac and Ohio and west of the
Mississippi.---The 32 states referred to have a population of
about 60,600,000.
For the fiscal year ended June, 1931, they paid, anoroximately
only 191% of the revenue derived from the income and corporation
taxes. The annual burden to which the citizens of these 32 states
would be subjected, even by a complete cancellation of the debts,
would be about 78a per capita----Mississippi, burdened by 10/ per
capital per annum, by complete cancellation, would receive an in-
creased income of $10.70 per capital from an advance of 2~d per
pound in the price of cotton. Arkansas, carrying an added impost'
of 12/ per capital would find its economic position similarly improved
to the extent of $12.50 per capital. Kansas, burdened with an addi-
tional 95/ would benefit by $11.90 per capital through an advanceof
20' per bushel in wheat.

#40. NEW REPUBLIC, December 28, 1932. p.174. Editorial.
Congressmen have said that they did not dare to.be lenient with
Allied debtors because the public sentiment of debtors in this' coun-
try would not permit them. A farmer who. owes a mortgage does not
see why France, too, should not be made to pay. But there is a
difference; France has goven no mortgage. How could she be made to
pay? The farmers can be dispossessed. The logic would.work better
if the congressional friends of the farmers had created a precedent
for voluntary.debt relief by being lenient with the .Allies.

#41. NATIONAL CITY BANK OF NEW YORK. Monthly Letter fmP December,
1932. p.178.
The markets have given prompt evidence of the depressing effects
of the decline in sterling upon prices. About the first of the
month the fall in commodity prices which had been under way since
early September appeared to come to a halt,.with indications of great-
er firmness in many of the important staples.including wheat, cotton,
silver and cocoa; and' others which have dropped back to the lowest
levels since early Summer include .cotton, silk, wool, rubber, sugar
and tin.

#42. NATIONAL CITY'BANK OF NEW YORK. Monthly Letter for December
1932. p.178.
If Britain is not to pay by shipments of'gold she must go into
the markets and bid for the means of payment in-the United States
in the United States, in other words for dollar exchange. On account
of the low state of international trade and the falling off of ex-
iorts to this country the amount of dollar exchange (claims on the
United States) is abnormally small, a-nd the demand for it will raise
the price, not-only in London but in all markets. Thus it will be
made more difficult and costly to obtain the .means of making pay-
ments in the United States, manifestly to our disadvantage. In
other words, by forcing the issue at this time we make it more
difficult to sell our products not only to Great Britain, but every-
where. More currencies are now related to British currency than
to the gold standard, and the effect of widening the gap between
the pound sterling and the dollar must be to.depress the general
price level in all of these countries-in comparison with our own
price level, and since prices upon our export commodities abroad


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affect our own domestic price's,..the -final effect of depressing
these currencies is to'drag all commodity prices to a lower'level.
Above everything else this should be averted.

#43. REVIEW OF REVIEWS, January, 1933. p.34-C.T.Revere.
Illustrative of steps taken to prevent paying out dollars, Ger-
many has placed a duty of. 1.62 a bushel and France a duty of 41.71
a bushel on wheat. These tariffs have made:both these countries
practically self-contained in regard t.o production of this cereal.

#44. THE NEW YORK TIMES, December 2, 1932, -p.12. The Text of the
British note on debts to. the United.States,: delivered'to Secretary
of State Stimson by Sir Ronald Lindsay, British Ambassador, Decbm-
ber 1, 1932.
If war-debt payments.had.to be resumed,: it is apparent that
the exchange position of this country would need to be strengthened
by a reduction of the very heavy adverse balance of the visible
trade of the United Kingdom and the UnIte'd-States,. w- ich amounted-
to L73, 00,000'in 1931., In present circumstances this 'could only,
be done by adopting measures, which would, further restrict British
purchases of American goods. .,. "

#45. NEW'YORK HERALD TRIBUNE, December 4:, 1932. :Section 2, pp.l.Col.9.
Lord Beaverbrook's "Daily Express." quoted.
The question arises," says, the paper, "what Ameri'can'imports
can Britain cut off. Trade .return's for. 1931 supply thte answer.'*For
motor cars' L4,400,000. British cars are better and cheaper. For
radio, L700,OQ.. Why,not buy the.'best radio, -which is British?
Fbr angles L4,0'00,000. England is the country that invented cider
made from British .apples. For iron and steel manufactures, L1,400,
000. Britain exports .iron and steel and .buys it back in manufactured
form. 'Leave that. j.ob to Sheffield. -For.meat -products, L6,700,000
That includes fresh pork, ham and bacon. The British'pig can take
on 'that job and should be given a chance.. '
S "For animal oils and fats--edible--fL6,700,000. British agri-
culture can supply the whole lot. Flr..rubber manufactures,L950,000.
Half of the raw rubber'the wbrld requires is in the British Empire.
For manufactured wood L1,700,000. The finest timber reserves in
existence are in.the British Empire. For barley,L1,500,000. Nor-
folk can take that item in its stride. And so the list goes on.
There is scarcely an item outside :of certain raw'materials which does
not offer mute assistance to the necessary total. But we should be
absolutely'just and. only reduce the imports from America by the
exact amount necessary to meet the debt payments."

#46. THE ECONO1MIST (English). November 19, 1,032. p.91..Editorial. '
The deterioration of trade, employment and budget has been
more 'serious during the past 12 months in the "gold" countries
than in Britain or other countries in which .the gold standard has
been suspended, .

#47. "EVIEW OF REVIEWS.. January,.' .19335,p.33. C.T.REvere.
The inexorable .fact stares, us .in the face that if recovery is
to be brought about, it .must. come through, a rise in the prices of
raw materials and foodstuff.s-.-world prices, not domestic prices,
and that this rise cannot come until the incubus of.the inter-'


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SUPPLEMENTARY REBUTTAL NOTES


governmental debts has been lifted from economy.

#48. THE NEW YORK TIMES, December 4, 1932, p.E3. The Week in Europe;
Sad Debt Diplomacy, by Edwin L. James.
Great interest should be attached to the British argument that
the Lausanne settlement will not be ratified if no better arrange-
ment can be made with the United States. Naturally, there is no
grept expectation in Europe that Germany can be got back to the
Young Plan payments, but, as Prime Minister iacPonald told Chancener
von Papen at the close of the Lausanne Conference, if the accords
made there are not ratified there would be another reparations
conference. Certainly Britain and France would try to collect from
the Reich as much as practicable toward what the, would pay the
United States. It is certain that Germany will make the plea, as
in the past, that she cannot pay both reparations and her private
debt abroad. That is where we shall hear about the 03,000,000,000
citizens of the United States have invested in Germany.

#49. CHASE ECONOMIC BULLETIN, November 10, 1932. pages 3-4. Benjamin
M. Anderson,Economist. The C'-ase National Bank of the City of
New York.
There has been no time in the past 36 years when there has
been justifiable ground for doubt as to our ability to maintain the
gold standard in its full integrity---during the past spring, our
gold position was so very strong that we were able to release to
foreign countries approximately 440 million dollars in gold with-
out even tightening our money market. At the lowest point of the
gold holdings on June 15, after the foreign withdrawals were com-
pleted, and after the domestic gold hoardings had spent their force,
our Federal Reserve Banks had 40% of gold against Federal Reserve
notes and 35% of gold and lawful money against deposits and over
and above that approximately one billion dollars in gold.


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