Possibility of $50,000,000 National Loan for Palestine Discussed by Judge Bernard Rosenblatt

The possibilities for a national loan for Palestine were discussed by Judge Bernard A. Rosenblatt, American member of the Economic and Finance Committee of the World Zionist Organization and president of the Palestine Securities, Inc., in an interview with the representative of the Jewish Telegraphic Agency.

A national loan-for Palestine must be based on the assets and expected income from the country itself and not merely upon the power of the Jewish people to collect money on a donation basis, Judge Rosenblatt, who was responsible for the Tel Aviv bond issue, the first Jewish municipal loan in modern times, declared, referring to a report in the New York “World” of the meeting in Tel Aviv on the proposed $50,000,000 loan suggested by Dr. Arthur Ruppin and sponsored by Henry Morgenthau.

Judge Rosenblatt pointed to the fact that since the Tel Aviv bond issue, this first Jewish city has grown from a small town of less than twelve thousand population to a city of over forty-five thousand, in a period of about three and one-half years.

“Just now Tel Aviv seems to be going through a political struggle between the Labor Party and the so-called Middle class,” said Judge Rosenblatt. “This I am sure is only a passing phase in which the usual political recriminations are indulged in by opposing leaders.

“In the meantime, the property value of Tel Aviv has increased enormously, so that Tel Aviv could qualify for the larger loan, necessary to undertake the Sanitation System proposed when the first bond issue was launched. The proceeds of that bond issue was intended to cover improvements in streets, water supply, a jetty and the installation of a system of sanitation. The city grew so rapidly, however, that by the time the bond issue was completed, the proposed Sanitation System would have been entirely inadequate, three times as much money being required to meet the demands of the larger city. The City Council, consulting with the special committee, which was in charge of the proceeds of the Tel Aviv bonds–and on which leading members of the so-called Middle class party were represented — decided that it was the part of wisdom to apply the larger part of the funds to the other purposes specified, to wit: the opening of streets, improving the water supply, etc. This would require that a second bond issue, in a larger amount, would have to take care of the Sanitation System. Such a bond issue probably would have been negotiated last year, but on my advice the Municipality of Tel Aviv is working unselfishly for a union with larger Jewish farming colonies so that we can bring before the investing public a relatively large bond issue of the proposed “Jewish Municipal League” of Palestine.

“I doubt whether such a bond issue can be as large as that proposed by Dr. Ruppin and Ex-Ambassador Morgenthau, but in time, there is no doubt that such a union of Municipalities will command respect in the financial world. The fact that the little city of Tel Aviv borrowed its money at 676 per cent, while Poland has had to pay over 8 per cent, the large French cities considerably over 7 per cent and even the Kingdom of Italy, only recently, has had to pay 7 per cent, speaks volumes for the confidence that investors have in Palestine. I might add that even after deducting the 10 per cent commission paid to the bankers in New York, the total cost of the money to the Township of Tel Aviv (since the money is borrowed for twenty years was about 7 per cent — or 2 per cent below the current interest rate in Palestine itself — and compares favorably with what the best governments and the largest cities in Europe have been able to obtain in America during the last few years.”

Calonel Michael Friedsam, president of B. Altman & Ca, and chairman of the New York State Educational Commission. was reelected of the New York Fifth Avenue Association