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Show WEEKLY KEIFS ANALYSIS BY JOSEPH W. LaBllE How to Pay for New Conflict Is Europe's Biggest Problem; British Taxes Set New Record (EDITOR'S NOTE When opinions are expressed in these columns, they are those of the news analyst and not necessarily of this newspaper.) .Released by Western Newspaper Union. THE WAR: Finance Great Britain entered the World war in 1914 with a 649,000,000-pound debt, raised her tax rate to six shillings shill-ings in the pound (or 30 per cent) and probably spent 11,076,000,000 pounds (about $55,000,000,000) to lick the Kaiser. In 1939 Britain's record peacetime budget was 1,322,444,000 pounds, of which 380,000,000 pounds was to be borrowed. Most of this was for defense, but what bothered Britishers most on September 1, when they declared war on Adolf Hitler, was their current public debt of 8,200,000,000 pounds, 13 times greater than 1914's. To Sir John Simon, chancellor of the exchequer, fell the financing job. Up to the house of commons Sir John carried his first war budget, I ' ! ' . V f i SIK JOHN AND BUDGET V. S. taxpayers can be thankful. neatly packaged in the ancient case (see photo) which exchequers have used for years. Preliminarily, commons com-mons knew the war of 1939 would cost more than the last conflict, would possibly last longer, and would positively bleed the British taxpayer to death. Sir John therefore there-fore surprised no one with his budget: To raise 70,000,000 extra pounds this year, and 146,000,000 extra the next fiscal year, Sir John assessed incomes at seven shillings in the pound, or 35 per cent, until next March 31; for the full 1940-41 fiscal year the rate is seven shillings sixpence, six-pence, or 37 per cent. American taxpayers should have enjoyed the comparison: Income of 52,000 per year: American British Family with two children. None $ 70.08 Married couple, no children None 246.26 Bachelor $ 40 350.40 Income of $4,000 a year: Family with two children . 28 721.26 Couple, no children 60 871.26 Bachelor 120 976.26 Income of $20,000 a year: Family with two children. 1,164 8.047.26 Couple, no children 1,260 8.2O2.06 Bachelor ' 1,450 8,326.26 Meanwhile fireside economists debated de-bated how Adolf Hitler was faring in wartime. Disregarding his pre-war debt and his funny financing, it was a good guess that even should these obstacles be overcome the allies' blockade would strangle him. One-fourth One-fourth his 1938 imports of S2,000,-000,000 S2,000,-000,000 would be cut off, including 90 per cent of his high-test gasoline; 67 per cent of his grain and all his cotton, rubber, wool and tin. Even Russia's new friendship could not be expected to offset this loss, for the press of war will keep German factories fac-tories busy, thus barring exchange of manufactured items for Soviet raw products. And Josef Stalin is not altruistic. At Sea One bright autumn day North sea villagers in both Norway and Denmark Den-mark hefard cannonading at sea, occasionally oc-casionally spotting aircraft over the horizon. The booming stopped at night but started with new fury next day. Both Britain and Berlin .0001 1st 2ii5 3rd 4tiT Tons Week WeeK Week Week 80W)OTons f - 4B,OOOTons I ' "W21,00OTons BRITAIN'S SHIPPING LOSSES Submarines went down, too. at first denied a battle, then each admitted it and claimed victory. The press could choose between the Reich's report that one British airplane air-plane carrier had been destroyed and a battleship badly damaged, or the report of London's first lord of the admiralty, Winston Churchill, that a German attack had been repulsed re-pulsed with no losses. Day before, popular Mr. Churchill Church-ill told the house of commons that 'a third" of Germany's submarines had been destroyed and that shipping ship-ping losses were about a third what they were in disastrous April, 1917. Moreover, losses were still going down fjee chart). What he did not point out is that Britain has fewer boats at sea now than on September Septem-ber 1. Eastern Front After a 20-day siege, during which it was 'bombed and burned into an unspeakable inferno," during which thousands of civilians died from bombs, bullets, pestilence or horsemeat diet, Warsaw surrendered surren-dered and the war in Poland was over. Western Front After a month of see-saw fighting during which French-British troops apparently had the upper hand (thanks to Germany's pre-occupa-tion with Poland) the battle of Siegfried Sieg-fried vs. Maginot apparently got under un-der way. French pressure was heaviest near Zweibruecken in the Saar region, and at least one report said that heavy French cannonading cannonad-ing smashed a hole in the main Siegfried Sieg-fried line between Merzig and Saar-bruecken. Saar-bruecken. Certain it was that heavy artillery assumed new importance, for the French war office admitted enemy shells were falling in small towns behind the Maginot line. For the moment. Premier Edouard Da-ladier Da-ladier could tell his council of ministers min-isters that the situation was "most satisfactory." DOMESTIC: Repercussions Dramatic volumes might have been written last month about how Europe's war whipped the slow stream of U. S. life into a raging river filled with whirlpools, quicksand quick-sand beds and bottomless pits. At Los Angeles Mrs. Josephine Mair filed a notarized document forbidding forbid-ding her two sons from "participating "participat-ing in any activity called war." The U. S. fleet began secret battle games in the Pacific, a vast naval training program was planned at Hawaii's Pearl harbor, and President Roosevelt Roose-velt urged a cessation of foreign purchases of war materials that the U. S. might create its own reserves. While Texas' Rep. Martin Dies waved the flag to forecast all Communists Com-munists and Fascists in government jobs would soon ,be ousted, while the American Legion in convention cut its foreign tie with the Federal Interallies des Ancien Combattants, while two-thirds of the people (in a Gallup poll) said they don't believe German news reports, congress wrestled with neutrality and appeared ap-peared to be making progress on a proposal to lift the arms embargo and substitute cash-and-carry. Franklin Roosevelt's administration administra-tion was winning, thanks to smart handling of the issue by Sen. Key Pittman and colleagues. To placate anti-repealists and anti-New Deal ers, congress was given power which the President Presi-dent alone enjoys under the present act, to decide de-cide when a foreign war exists. In every other provision there was similar rig- K V - 'J CORDELL HULL Vo comment. ldity, so that isolationists were left with little to fight except the fast-dying fast-dying issue of embargo vs. cash-and-carry. Having started the ball rolling, the White House left neutrality neu-trality severely alone. Secretary of State Cordell Hull, asked for his opinions, answered Sen. Arthur Van-denberg Van-denberg that he had "complete confidence" con-fidence" in the legislative branch and that he had no "particular comment" com-ment" to make. Next day the senate foreign relations rela-tions committee okayed cash-and-carry, sending it to the floor for "hell-to-breakfast" debate. This was war's effect on government. govern-ment. On business, the effect was a fearsome upsurge that may some day boomerang. Items: C. On the farm, the department of agriculture found all larders full to bursting (July 1 wheat supplies were 275,000.000 bushels over a year ago). The year's agricultural income, once expected to slump far below 1938's $8,090,000,000 mark, may now be only 100,000,000 shy. Flour output reached a 12-year high. C Railroads everywhere placed new equipment orders. Typical was the Burlington's bid for 14 locomotives. locomo-tives. A 22.4 per cent rise in car-loadings car-loadings was forecast for 1939's last quarter (compared with last year), ft Steel mills, America's No. 1 heavy industry, operated at 83.3 per cent of capacity, dangerously near the 85 per cent mark which steel men consider a practical level. C. Oil production was up. A typical typi-cal late September week brought 3,681,000 barrels, a gain of 258,000 barrels over the preceding seven days. C Electricity production rose, con-tra-seasonally, about 13.7 per cent in a week. RUSSIA: Dance Master Down from the western skies at Moscow dropped a passenger plane bearing German Foreign Minister Joachim von Ribbentrop. Significantly, Signifi-cantly, perhaps, he gave no Nazi salute nor did his hosts offer a Communistic Com-munistic clenched fist. Otherwise the setting was familiar, for when von Ribbentrop reached the Kremlin Krem-lin he found it overrun with Balkan and Baltic statesmen of the type Adolf Hitler used to summon from Austria, Czecho-Slovakia and Poland. Po-land. This must have worried von Ribbentrop; Russia, having split Poland's Po-land's loot with Herr Hitler, was emerging as a dominant eastern Eu- 1 f,Vf v j?" r - s , - $ - ' ' ' , " ' V ' - VIACIIESLAV MOLOTOV He out-Hitlerized Herr Hitler. ropean power that must be watched. Great Britain and France were confident that if left alone, Russia would give Germany more trouble than co-operation despite their kiss over Poland's prostrate form. First there was talk in Moscow diplomatic circles of a "sphere of influence" division in which Russia would control con-trol the Baltic, and Germany the Balkans. But later it looked like Russia was taking everything: Estonia's nervous Foreign Minister Min-ister Karl Selter scurried to Moscow Mos-cow with explanations of why an interned Polish submarine had been allowed to escape, later sinking a Russian freighter. His explanation was "unacceptable" and soon Soviet So-viet troops, warships and planes encircled en-circled Esthonia. Under this pressure, pres-sure, and while Moscow radio attacked at-tacked the Esthonian government, the little nation soon found it wise to sign a "mutual assistance" pact which grants Russia the right to maintain naval and military bases on islands off the Esthonian west coast. Latvia and Lithuania, her neighbors, wondered which would be next. Turkey's Foreign Minister Sukru Saracoglu was there, too, and soon there were sound reports of a Russ-Rumanian-Bulgarian-Turkish "Black sea bloc" which would smash Adolf Hitler's hope of Balkan expansion. Rumania, between two fires, was leaning Moscow-wise and away from Berlin. Bulgaria's special envoy to the Kremlin established a Moscow-Sofia Moscow-Sofia airline to be followed by a trade pact. Jugo-Slavia had a representative rep-resentative there, too, on a secret mission. The only fly in this ointment was Herr von Ribbentrop and the 35 "experts" "ex-perts" who came with him from Berlin. While Dictator Josef Stalin stayed in the background like any well-behaved master mind should, Premier Viacheslav M. Molotov called the tune that made big Germany Ger-many dance as violently as the little lit-tle Balkan and Baltic states. The mere fact that Hitler's men had gone to Moscow, and not Stalin's men to Berlin, offered good evidence that Russia has grown in one month from a silent, sulking and overgrown boy into a dominant European figure which der Fuehrer must fear. , Only strengthening this suspicion was the official German news agency's agen-cy's report that Russia has agreed to co-operate in an attempt to bring peace between the Reich and the allies. Obviously Herr Hitler was frantically sparing no effort to end the war. The previous weekend had brought a peace feeler from Benito Mussolini, but the result had been negative. Therefore Germany had coaxed and beg?ed Russia into the peace effort, even though the price for this co-operation was a loss to German prestige in eastern Europe. International observers, guessing that Adolf Hitler had found himself playing with fire, decided that Der Fuehrer may yet be consumed con-sumed by the fire of Josef Stalin's , Communism. |