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OFFICIAL STAFF OF THE AMERICAN BANKERS' ASSOCIATION (1), First Vice-President, John H. Puelicher, of Milwaukee; (2), Second Vice-President, Walter W. Head, of Omaha; (3), Executive Manager, Fred N. Shepherd; (4), President, Thomas B. McAdams, of Richmond; (5), Treasurer, F. A. Irish, of Fargo, N. D.: (6). General Counsel, Thomas B. Paton; (7), Secretary and Assistant Treasurer, William G. Fitzwilson.

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Endorsed by the Executive Committee of the Trust Company Division, American Bankers' Association


September, 1922

Number Uhree




HE United States Government because our own national self-interest must abandon its deliberate and and economic future demand a more encomplacent attitude of unconcern lightened foreign policy.

toward the increasingly critical con- We cannot continue to sit in comfortable ditions prevailing in Europe which are armchairs at home in legislative champregnant with the germs of calamity and bers at Washington, stultifying or solacing renewed warfare. As the outstanding ourselves with liberal potions of the decreditor nation we are particularly exposed natured old doctrine that this country is to the far-reaching consequences of eco- self-contained, or in the words of George nomic collapse, national bankruptcy and Washington, that "Europe has a set of the dread prospect of revolutionary reac- primary interests which to us have none or tions, toward which Central and Eastern a very remote relation.” That was doubtless European countries are inevitably heading. sound political logic in the early days of For moral as well as for very practical the struggle for independence, but it does reasons the United States is urgently needed not hold water in this modern era of swift at the conference tables in Europe, especially communication, of closely knit trade and at discussions dealing with reparations and economic interdependence. adjustment of external debts. That is the The poignant cry to us from despairing conviction shared by the writer with many populations in Central and Eastern Europe other Americans who have recently visited is not for huge credits, capital loans or conthe continent of Europe and who have not signments of gold from our idle store to confined their observations to hotel lobbies revive their rotten currency structures. and cabarets.

More than all else, it is our moral support, To judge not merely from hearsay, but our presence as the Big Brother, that Euto see with one's own eyes the naked, tragic rope craves. They long for a voice that will evidences of hopeless economic, social and rise, vibrant in its accents of unselfishness political confusion and to witness the des- and detached judgment, above the Babyperate straits to which great masses of lonian jargon of conflicting tongues and people and apparently aimless governments emotions. They want us over there in in continental Europe are drifting, is to be Europe not as "unofficial observers,” standconvinced that the United States must step ing idly on the side lines. They want us as in, not only for humanitarian reasons, but counselors and guide. Even Lloyd George, Poincare and other leaders who face each HELPING SUROPE TO HELP other at futile political, reparations and

ITSELF economic parleys, confess their weariness of the game and their eagerness to accept IT a new deck and a new deal from America I picion

that Europe only desires the as the only nation they are willing to trust United States to "come across" with by common consent. That applies not abundant capital, credits and to wipe out only to reparations and economic questions, debts. The underlying fact is that Eurobut to the League of Nations as well. pean nations, large and small, possess the

The people as well as the statesmen in resources and capacity to set their houses Europe know that the United States has in order. Debased currencies, progressive no military or territorial aspirations; that paper inflation, staggering government deit has disinterested ideals for which it will ficits and industrial stagnation are not due fight, and a heart generously responsive to to the destruction of property and loss of appeals of humanity. These qualities were manpower wrought by the war. They are sufficiently revealed during and since the due to stupid political and administrative war. They are today displayed in Smyrna blundering. Lacking the courage of their where our naval units were the rst to inner convictions and fearful of each other, give protection to refugee Christians. What

the European statesmen are chasing rainis needed here in the United States is an bows, follow the lines of least political awakened public opinion as to the real risistance and rely upon reparation paygravity of the situation in Central and ments that cannot be paid. Eastern Europe in order to bring about a revision of the verdict given at the last

American representation is needed to Presidential election and which the Har

restore common, practical business sense ding Administration interprets with more

Aside from

in European deliberations. fidelity than wisdom.

neutrals, England is the only European The most powerful and health-reviving has succeeded in balancing its budget and

nation among the former belligerents that stimulant that could be administered to Europe would be an early announcement

tackling the problem of reducing debt and. from the United States Government that it

inflated currency. A deficit of 14,000,000,will send official representatives to repara- France, with 4,500,000,000 allotted for

000 francs appears in the 1923 budget of tions and economic discussions. Such par

maintenance of its army, with outstanding ticipation does not mean that we must

debt of 315,000,000,000 and actual reparyield our political autonomy; enter into entangling alliances or commit ourselves

ation payments from Germany barely sufto cancellation of either the whole or part

ficient to cover expense of occupation

forces. Belgium is piling up deficits predof the war debts due from former allies. We can make our own terms as to partici

icated upon expectation of German pay

ments. From the standpoint of government pation.

finance and currency inflation, Germany, Far more important than any material Austria and Russia are hopelessly insolvent, or financial contribution that we could possibly make to restore economic or poli- ing billions of worthless paper money,

their printing presses grinding out increastical poise in Europe would be the weight Poland, Jugoslavia, Czechoslovakia and of our impartial judgment. That factor

all other newly created "self-determination" cannot be emphasized too strongly as the countries are infected with the same fatal one essential element to help Europe to poison of fiatism. Government heads are help itself, by substituting good will for in a state of helpless stupor, apparently mistrust and comprehending that most of

unable to stem the tide toward national the present suffering is due to failure to

bankruptcy. see that selfish political claims must be subordinated to everlasting economic truths

And back of all this conglomeration there -truths that cannot be twisted to please lurks the monster of. Russian Sovietism, any one nation, but which apply with equal stealthily spreading its coils wherever hunforce to all nations.

ger and suffering have become most acute.

MILITARISM AGAIN IN ish. There can be no headway against

economic disaster until peace and good will

are effected between all the nations, the To rescue Central and Eastern Europe former belligerents as well as neutrals. from utter demoralization it is first of all The naval armament limitation confernecessary to secure unity and accord ence at Washington produced the first among Anglo-Saxons and the leading Allied gleam, since the armistice, of a chastened nations. There is every reason to believe international conscience and a desire to that European governments are ready to profit from the lessons of the last war. The join a new “association of nations" such opportunity is at hand for another and as approved in the Republican platform greater master stroke by the Harding Adand by President Harding. Each succeed- ministration. Let the word go forth from ing development makes more apparent the Washington that this government is ready impotency of the League of Nations, and to send its best official advisers to take part the growing dissatisfaction among signa- at a conference in Europe, analogous to a tories of the Treaty of Versailles as a docu- creditor's committee, to consider the probment impossible of fulfillment and a breeder lems of interallied debts and reparations of future wars with its arbitrary mandates as a composite proposition. Judging from and territorial divisions.

the assurances received by the writer in The threatening war clouds growing out interviews with leading statesmen and of the Turco-Grecian conflict shows how bankers in England, France, Italy, Belurgent it is for the United States to make gium and Germany, it is safe to say that common cause with England, France and such American participation would lead to other powers to enforce guarantees of peace. something definite. Thus far all economic Without such assurance the competition and political conferences have been barren for military dominance will become even of results, serving only to alienate and widen more keen than before the war and the the breach between the nations who fought prospect of gradual disarmament will van- side by side during the war.



IMPOSSIBLE REPARATION people of the United States. She will listen

and be influenced by America's official HE best political and financial judg- where she now turns a deaf ear to her former

representative at reparation conferences T ment in Europe wants official repre

allies in Europe. At the same time the sentation from the United States because of the direct influence which our

assurance of this country's moral support

will lessen the fear of future military agspokesmen could exert to induce France to modify and bring its policies into accord gressions by a rehabilitated Germany which

dominates the French mind and which is with those of its Allies, particularly in regard to German reparations and inter

the impelling reason for the large military

establishment maintained by France. allied debts. The Genoa conference failed because of the refusal of France to subscribe

The best service that the United States to necessary economic formulas upon which

can render to France is to stress the fact, practically all of the experts were agreed.

which is obvious to all impartial observers, The Bankers Committee, which met in

that in pursuing a policy of ruthless enParis to consider an international loan to

forcement of impossible reparation deGermany, failed because France was un

mands, she is nourishing among the Gerwilling to admit any consideration of guar

man people the elements of resentment and antees based upon revision of German

the feelings of revenge against which she reparation payments as a prerequisite to

wishes to guard. By way of parenthesis the flotation of an issue of German bonds.

it may be remarked that France keeps

alive needless friction by maintaining colWhether due to external or internal force

ored colonial troops in German occupied of circumstances the fact remains that the

territory. situation as to German reparations is at the heart of political and economic confusion in Europe. There can be no progress. toward carrying out the program of eco

SITUATION IN GERMANY nomic reconstruction suggested at the HATEVER shortcomings the present Genoa conference until the question of

government in Germany may be indemnity is clarified. Adjustment of inter

charged with, in permitting the allied and floating debts, balancing of na flight of capital and failure to enforce proper tional budgets, exchange stabilization, ces

fiscal control, it cannot be said that there sation of paper money inflation and restor

is any indication of sympathy with monation of the gold standard in the revalu archistic reactionaries. It is physically ation of currencies, are matters that must impossible, as long as the present system be held in abeyance.

of surveillance by allied agents continues, Public opinion in Europe is overwhelm for Germany 'to build up another war ingly in favor of revising reparation claims machine. - From the masses of German and payment schedules if for no other laboring people and middle class one gains reason than to give the German people a the impression that militarism and Kaiserdefinite goal of expiation to work toward ism are chiefly blamed for the misfortunes and to have no pretext for avoiding obli that have befallen them. gations. Even well-informed Frenchmen

On the surface Germany seems to be have admitted to the writer that they re busy and industrially prosperous. gard Poincare's policy as suicidal; that it

matter of fact, it is a feverish and fictitious is aimed rather at the political, industrial prosperity. With the rapid deterioration and economic disintegration of Germany of the mark the people are eating up their than the collection of full reparations. substance. Unless a moratorium is effected Common sense must teach that a solvent, and the mark is stabilized, Germany is industrious Germany is desirable and that doomed to bankruptcy. With no reserves a bankrupt Germany would plunge all

to draw upon when unemployment comes Europe still deeper into the mire.

there will be famine, lawlessness and a France values and ardently wishes to debauch to radicalism. Not only prostrate preserve the friendship and good will of the Austria but all Middle Europe will be car

As a

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