2 JANUARY 1932, Page 22


[To the Editor of the SPECTATOR.] SIR,—Most of us will cordially agree with your proposition that " Europe as a 'whole must tell the United States plainly that if reparations payments have to cease, then debt pay- ments must cease too " ; but these words only stress the gravity of the situation, for, unless we are philosophically pragmatists and in conduct opportunists, every issue is in the last resort an ethical issue. The radical assumption of Western political and commercial ethics has been so far that a bond must be honoured. We declared war on Germany over a " scrap of paper " ; Russia remains a pariah in the West because she repudiates both Government and private bonds. Necessity, as the Germans told us, knows no law, and the imminent collapse of Europe, both political and commercial, if the letter of the law is insisted on, may well be pleaded as the excuse for repudiation. But what we contemplate doing is repudiation, and it is best to face facts.

We may believe that the Americans are living in a fools' paradise and have lost all sense of realities ; we may smile wearily at the condition of remission they lay down, that Europe should disarm, when they themselves are engaged in building the greatest war navy the world has yet known ; but a creditor has the right to make conditions of remission, and if America seems to us a Shylock among nations, she is a Shylock who has the legal right not only to exact her pound of flesh but to exact too the life-blood of her victims.

If Germany satisfies the other nations that she cannot pay, she has the right of the debtor to go bankrupt, but we cannot put in the same plea. If we received nothing and paid America in full, we could still stagger on—for a time. The Balfour settlement contained no qualifying clause, and America's dealings with Europe were based on the assumption that Great Britain always honours her bond.

The legal position of America is unassailable, and what is on trial now is the radical basis of Western ethics. If under necessity we repudiate, we accept the ethics of Treitchke and Lenin ; the precedent once set may be indefinitely followed. There is yet time for America to come to her senses and regularize the position by consenting to remission in so far as Germany cannot pay, but with traditional systems crumbling it is important that both we and America should realize that we are on the verge of a step that will destroy one more bulwark against revolution.—I am, Sir, &c.,

ychbold Vicarage, Droitwich. E. C. OWEN.