Capital Comment

Suggestions that debtor nations might make payments in kind to the United States have reopened speculation on negotiations for trade agreements. The German government’s note to this country was quite marked in its appealing hint that every encouragement should be given to increased trade between the United States and Germany if this country expects to collect debts from the Reich.

Just before all of the talk about payments in kind, and before the exchange of notes between the United States and debtor nations, George N, Peck, head of the newly created Federal bank for stimulating exports, made a report to President Roosevelt in which he pointed out that if this nation expects to sell goods abroad it will have to import more goods in return. This report paved the way for President Roosevelt’s message concerning payments in kind and took all of the shock out of the suggestion.

Germany is in a critical economic situation and is sorely in need of export outlets. The boycott against the Hitler government, primarily because of its anti-Semitic polices has serously curtailed Germany’s trade with the United States, Great Britain, France and other countries. Further curtailment of Germany’s trade is seen in reports that Great Britain, France and other nations are considering stern reprisals in the form of a special customs tax on German goods, or the impounding of German trade balances. These are being considered because of Germany’s failure to meet her obligations to creditor nations.

The United States would like to collect her debts from Germany. Also, this country would very much like to have Germany buy more American goods, especially lard and other hog products. Germany once was this country’s leading market for lard. Now it is the poorest market because of trade barriers. The loss of the German market for hog products has been a severe blow to American agriculture. George Peck would like to have the United States regain this market and it could be done, if this country would agree to buy more goods from Germany.

America has an extensive interest in the German moratorium. Approximately $100,000,000 of the Dawes-Young loans are held in this country, while it is estimated that about $600,000,000 represents the aggregate of other affected issues of German municipalities, governmental sub-divisions and industrial corporations — in possession of American investors. Germany claims that the only way Americans can expect to be paid is through the purchase of more goods from her.

Germany is bitter in blaming the outside world for her present critical economic position. The country has been hard hit by the boycott on German wares and the Reich argues that as long as Germany is debarred from selling abroad on a normal scale and building up commercial balances by that means she cannot meet her obligations. Germany admits that the boycott is causing economic paralysis and she is determined to resort to any course to enforce its removal.

A Government official, who better than any other American knows what is going on in Germany, last winter said that the Hitler government was about to face a serious crisis. At the time he expressed an opinion that he doubted if the Hitler power could remain in the saddle much longer without some of Hitler’s leading lieutenants breaking away from their leader’s policies.

This Government official’s words rang true the other day when Vice-Chancellor Franz von Papen issued a vigorous blast against Nazi doctrines. Another break was the recent resignation of Count Rudolf Nadolny as German ambassador to Russia. In East Prussia opposition is developing against the Hitler regime’s policies, especially as they concern agriculture.

Of great significance to world Jewry is the visit to this country of Baron Maurice de Rothschild, a scion of the famous house of Rothschild and one of the leading members of the French Senate.

Baron de Rothschild is one of the powerful men of France. He is deeply interested in international affairs and in particular has been a close observer of what is going on in Germany. In the French Senate he is considered one of the best informed members on international affairs.

His visit to the United States was in connection with a world tour. Baron de Rothschild came to the United States from Japan where he had the privilege rarely granted to foreigners, of being received by Emperor Hirohito.

The plight of Jews in Germany is very close to his heart. While in the United States he had occasion to discuss the situation with several leading Government officials.

Germany’s policy of spending millions for Nazi propaganda in other countries and spending additional millions for building up a military machine is not being looked upon with favor by most nations, especially those to which Germany owes money.

With Congress out of the way, the McCormack committee investigating subversive propaganda activities in the United States is making preparations for holding a series of hearings in various sections of the country. These are expected to begin in the next two or three weeks. Representative John W. McCormack, committee chairman, has indicated that additional surprises are in store for the American public when the committee resumes its public hearings.