Show m d- d Q i d x i World Monetary Plans r Il S Seen een as B Boon oon to t 0 T Trade ra d e y r J l t i t I r. r Funds Would Help Restore Production and r I j Stimulate Exchange Exchange of Goods In A Postwar Era Treasury Says f By BAUKHAGE and Commentator News NIJ Analyst Service Union Trust Building uil ing Washington Washing D. D C. C I have just come from irom a luncheon of creamed chicken and rice green salad and trimmings The food was not however the interesting part of the affair The food for thought that went with it was And so was the setting We were served from a large oval table in the conference room of the United States treas treas- ur ury The hosts were Secretary of at the Treasury Henry and anda a squad of his fiscal experts The subject of the conversation was the same one which was discussed discussed discussed dis dis- cussed at many of the more than conferences which took place i around that same table and which led up to the Bretton Woods monetary monetary mone mone- fi tary conference last July Today that same subject is before Congress Congress Congress Con Con- gress in the form of pending legislation legislation legisla legisla- tion which would authorize American Ameri AmerI- can participation in an international bank of reconstruction and development development development develop develop- ment and an international monetary fund Upon the passage of this legislation legislation legislation legisla legisla- tion and the creation of the bank and and fund the minds master on money matters tell me depends the success of an any world security organization which may come out of the United Nations meeting at San Francisco Aim to Stop Economic Warfare The reason for that statement boiled baited down to its essence is this you cant can't stop international warfare unless you ou stop economic war war- far fare Economic warfare in this sense means international trade practices not in the common good good specifically some of the practices indulged indulged in indulged in- in in by nations competing for foreign trade before and after the grand smash of 29 How is this warfare to be restrained restrained re re- strained Quid pro quo of course In the vicious fight for trade after the war a large number of nations will have three strikes on them to start 1 They are wrecked some son physically lit and a great many more financially financial financial- rr ly lYe politically economically Those which will emerge less affected by bythe the war scourge like the United States Slates will be equa y affected if ff they have nobody with mane money or credit enough to buy their goods Therefore in exchange for an agreement to abide by certain fair practices as we might call them and contributions in cash or its equivalent under the Bretton Woods agreement a nation would receive I membership in an international bank which would guarantee private private private vate loans make loans make some direct for direct for forthe the purpose of reconstruction and development so they can build factories factories factories fac fac- tories and do other things necessary to create goods to sell and earn S. S money to buy These loans would be loans in which the risk is too toe great for a private institution to take and which if they were made and bonds offered to the public the public wouldn't touch But guaranteed guaranteed guaranteed guaran guaran- teed by the international bank over overa a long term private bankers would f lend the money and the public with the word of 44 nations behind the bonds would hardly be skittish I The monetary fund would be crea created ed for the purpose of stabilizing stabilizing stabilizing ing exchange and facilitating the I growth of international trade The members would agree to tie their exchange to the gold standard and not change it unless the governors and directors of the fund ap ap- ap- ap prove This his would stop among other things what amounts to imposing imposing ing hidden tariffs on foreign goods goodsby by changing the rates of exchange of a country's J currency in terms of other other nations nation's currency In their mad efforts to export goods at any price and get credits abroad the Germans had all sorts of different kinds of marks that had one value here and another there As to the administration of the bank and fund a very careful system has been worked out regulating regulating regulating regu regu- lating the amount of financial responsibility each country would have The figure would be based on n the trade of a nation over a certain past period with some other modi modi- For Instance the United States would assume roughly one- one third of the financial responsibility responsibility responsibility and have third one-third of the votes on how the money or credit is to tobe tobe tobe be handled Relief for U. U S S. S Bankers' Bankers Risks One of ot the chief arguments as to the direct value of the program for forthe forthe forthe the United States is this it Is estimated estimated estimated esti esti- mated that in the postwar period period pe pe- nod the United States bankers will have to do the bulk of the world lending Estimated on the amount we eve did after the last war perhaps as much as 90 per cent Rather than have the lenders risk the loss as they did last time it would be better better better bet bet- ter to have the thc government and the governments of the rest of the nations nations nations na na- na- na bear two-thirds two of the risk This they would do under the international international international inter inter- national bank It is pointed out by treasury officials that not only will most of the money be borrowed from private bankers in this country country country coun coun- try for the next five or ten years since we have most of t the money to loan but most of it will likewise be spent here since we have most of the things foreign countries need There are two chief reasons why such an international financial program program pro pro- gram will be to the disadvantage of the private banker although by no means all bankers oppose it One is that the governments of nations will wm control the world fiscal policy and not the leading private international international international inter inter- national bankers who had the control control con con- before The second is that in inthe inthe inthe the long run as sponsors of the plan admit it will lower interest rates Those two reasons are not stressed by the vocal opponents of the measure before members of con con- gress Many other objections some highly technical are set forth The main suggestion in the report of a committee of the American Bankers association is that because of unsettled unsettled unsettled un un- settled political conditions throughout through through- out the world any action ought to tobe tobe tobe be postponed until these conditions stabilize They say that the nations should agree to certain changes in inthe inthe inthe the program before it is presented to the congress Some of ot the changes suggested are prompt prompted d by honest conviction some are due according to treasury officials to a misinterpretation of the program There is a group in the United States which says that the United States will come out of the little end of the horn under the arrangement arrangement ar are ar- ar and that the British sold us a bill of goods There is a group in England which sa says s 's that Britain Britain Britain Brit Brit- ain w will come out of the little end of the horn and that the United States sold their representatives a abill abill abill bill of goods That is one thing which quite aside from the arguments pro and con on the various disputed parts of the program demonstrates that it must be pretty good Some weeks ago in this column I tried to explain why Germany came back after its defeats in France May I be permitted to explain why the Nazis couldn't come back backor for or the second time Once again we have to consider not the military organization of Germany Germany Germany Ger Ger- many alone but the civilian organization organization organization or or- as well Nazi discipline Because it was built on an entirely human anti foundation finally col col- col- col lapsed It was a discipline of 1 deceit deceit deceit de de- de- de 2 force Both were bound to fail in the end because it failed to take into consideration one thing which the Nazis refuse to admit exists the exists the human soul with threats brute force and an organization which could carry out the threats and exercise the force was effective up to a certain certain tain tarn point Then it failed Its strength was in bending the twig as I tried to point out in my earlier analysis Youth worshipped the false god cod of as long as its clay feet could be concealed Youth knew no other god But the moment the clay feet crumbled in inthe inthe inthe the defeat of its armies ie i.e. force failed youth deserted Even the older people despite th the numbing fear of the espionage of th the the fear of the concentration concentration concen- concen camp fear of the firing I squad began passive resistance The the military unfit drafted by Himmler refused to fight refused to assemble wh when n ordered ordered ordered or or- dered hid Regulations were evaded Taxes went unpaid |