Evening Star Newspaper, September 20, 1929, Page 29

FORT HOLDS FEAR OF BANK IS FALSE Opinion That Europe Would Thwart America Is Called Remote Danger. This 1s the sixth and last of che series of articles describing the purposes of the bank for international settiements under the Young reparations plan. BY WILLIAM H. FORT. NEW YORK, September 20 (N.A.N.A.) —1It is the opinion of some American economists that the bank for inter- national settlements in its operation as an agency for the exchange of world credits and as it grows in power and influence in world affairs may direct those operations into channels that will affect disadvantageously the credit of the United States. In both Europe and the United States scare opinions to that effect have been published. The international bank is to be sit- uated in Europe. It is to be controlled by directors of whom all but two or three will be European financiers. “Therefore, some critics insist, it is more than likely that the bank will work for Europe's interests to the serious harm of the United States. Fear U. S. Desires Will Be Lost. “The requirements of the United States for credit,” to quote one criti- cism, “may be lost sight of in the desire of these bank directors to carry out some policy in the interest of foreign governments and peoples.” To other American economists close- 1y in touch with the situation this dan- fiu‘-b‘-ppelrs so remote as to be neg- e. “'Xt must not be forgotten,” sald one of these, “that the world bank was for- mulated in the first instance as a neces- sity. Germany never would have as- sumed such heavy obligations without it. There has been and will continue to be much criticism of it as a plan. * But it must not be lost sight of that flaws can be picked in any plan. It is not contended that this scheme is flawless, ather it was considered as the most_ expedient agency that could be desired at the time to perform what has to be performed, namely, to guarantee to both Germany and her creditor nations that the debt payments will be collected and paid in as simple & manner as possible and in & manner which would guarantee the least interference of politics. “It is not perfect, but once started there is 'y reason to believe that it will do the work required of it, and do it simply and efficlently.” v Central Banks Are Cited. One grave fear expressed several times is that this international bank will not remain the non-political agency its originators planned. It has been said the central banks of Europe are “far from free from the influence of politics.” If that is so, it is feared by some that the directors of the bank, in pointing its policles, may forget the interests of the United States. Secretary of State Stimson, speaking for the Government of the United States May 16, said that “this Govern- ment does not desire to have any Amer- ican official, directly or indirectly, par- ticipate in the collection of German reparations through the agency of this bank or otherwise. ‘'* * * And for that reason it will not permit any offi- cial of the Federal Reserve system either to serve themselves or to select Ameri- can representatives as members of the proposed international bank.” ‘Though the directorate of the inter- national bank is to be made up of the governors of the central banks of the seven nations whose experts partici- pated in the Paris conference and their nominees—the United States, Great Britain, Germany, France, Italy, Japan and Belgium—Mr. Stimson’s position would seem to leave this country with- out official representation in the bank’s direction. How, then, can the United States protect itself against possible ac- tions by this foreign directorate which might react to the disadvantage of American interests? THE EVENING STAR. WASHINGTON, D. States be Tepresented, it necessarily will almost completely control the ac- tions and policies of this proposed world institution. It is pointed out that neither when the Dawes plan was formulated nor at the recent Paris conference did the United States have an official repre- sentative, carries the name of an American. At each conference it was an Ameri- can who exerted the dominating influ- ence, and, aside from personal factors, this was true for the same reason that Americans will hold the dominatin control of the proposed international sank. Those Americans represented, even though unofficially, the most powerful Nation, the Nation to which the rest of the world looks for economic guidance. When Secretary Stimson refused to allow the Federal Reserve system to participate in the direction of the world bank his refusal did not mean that the United States was to go unrepresented. ‘That was provided for—the governors of the European central banks will in- vite two Amer the directorate. Upon their acceptance they will become the actual representa- tives of the United States, and will be just as representative as though they were directors of or appointed by the Federal Reserve Board. Will Be Same as Official. ‘When European nations invite Amer- icans to participate in some plan they are careful to invite only persons ac- ccpl.:ble to the United States Govern- ment. The answer, it is explained, is that|same as if their appointment were the United States will be adequately |official. represented. Not only will the United Nor did Mr. Stimson's edict mean Mr; “Paint-Up” Says— “Want a New Table? You have your choice of 16 beautiful shades. Easy to apply . . . does not show brush marks. No odor—no sti Dries in Dress your furniture low cost. i 4 up at BUTLER-FL Paint Company ‘61’ Quick NN 607-609 C St. Phone Metropolitan 0151 Yet Americans headed both commissions as chairmen and each plan ican financiers to join | good Thus, in effect, the result is the that the Pederal Reserve system would rot co-operate with the international bank, for co-operation on the part of the Federal Reserve system, it is ex- lained, is inevitable. Therefore, the deral Reserve, though not officially represented on the directorate, will be to all intents and purposes co-operating with the international bank. As a matter of fact, when the pro- g?‘ud bank begins to function no exist- central bank can help participating in its operation. For example, if the international bank places millions of dollars to the credit of the Federal Re- serve banks of New York and Chicago, these banks can hardly refuse to accept it. It is well known that representatives of the central banks long ago recog- nized the need of consulting together the interests of their own countries. Suppose, for example, American busi- ness and agriculture required better markets in Germany or France. ‘To get them the United States might have to lend financial aid, just a: any business man tries to make things easy for a customer. There always has to be such co-operation. and the international for coal. Be wise. with lasting qualities. Buy now! While economically. 0000000000000 000000000000000000000000 ¢ 13812th St. N.E. 060660000606000000060600000000006 Sears, Roebuck and Co. RETAIL Bladensburg Road DEPARTMENT at 15th and STORE H Sts. N.E. OPEN SATURDAYS UNTIL 9 PM Pipe Furnace Warm Air Ace and up $5145 Hercules pipe furnaces “burn coal twice,” due to the new Fuel Saver and Smoke Con- sumer feature. A real lead- er in performance and low cost. 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They have to come to us for their gold. They are backed by American money—all of them. In such a condition of affairs I should think we should have our share, our full share, of influence. “What does’ it matter whether we have two directors or ten? The result is the same. They cannot function without us. Not only will we be ade- quately protected; it is hard to see how they can possibly do anything of which we do not approve.” And—trade-marked we can give you the Linc. 1203 Hours 9 to 5:30 —at and op 9695 Tubular Radiators Get Our Prices Convenient Payment We invite you to advantage of this serv- Ask the salesman for 00”““0000““““““““““00 impos- nations involved were consulted. O, FRIDAY, SEPTEMBER 20, 19%9. 1 bank sets up & regular agency for co-| Before the plans for the proposed bank for international settlements were to’ the Young agree- 1 banks of l:ve’n‘ t significant that without exception they expressed themselves as strongly ap- {mvln: the formation of such an insti- ution. 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