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Plenipotentiary to represent the Canadian Government in Washington.

We felt that the governing consideration underlying all the discussions of this problem must be that ther Great Britain nor the Dominions could be committed to acceptance of active obligations etrept with the definite assent of their own Goveraments.

of each particular part of the empire, it being understood that any new arrangements should be supplementary to and not in replacement of the system of direct communication from Government to Government, and the special arrangements which have been in force since 1918 for communications between the Prime Ministers."

AS TO THE WORLD COURT. One question which we studied was that of arbitration in international disputes, with special reference to the question of acceptance of article 36 of the Statute of the Permanent Court of International Justice providing for compulsory submission of certain classes of cases to the Court, On this matter we decided to submit no resolution to the conference, but whilst the members of the committee were unanimous in favoring the widest possible extension of the method of arbitration for the settlement of international disputes, the feeling was that it was at present premature to accept the obligations under the article in question.

His Majesty's Government in Great Britain arcepted the suggestion that in future any application by a foreign Government for the issue df an exequatur to any person who was to act as Ceasul in the Dominion should be referred to the Dominion Government concerned for consideration ad that if the Dominion Government agreed to the e of an exequatur it would be sent to them for enter signature by the Dominion Minister. We took note of the development of the special terest which had occurred since the Imperial Conference last met, viz.. the appointment of a Minister Plenipotentiary to represent the interests of the Irish Free State in Washington, which was now about to be followed by the appointment of a diplomatic representative of Canada. We felt that the most fruitful results could be indelpated from the co-operation of His Majesty's presentatives in the United States of America ready initiated and now further to be developed. In cases other than those where Dominion Minters were accredited to heads of foreign states it Tas agreed to be very desirable that the existing plomatie channels should continue to be used as between Dominion Governments and foreign Governments represented at the Imperial Conference eraments in matters of general and political concern. COMMUNICATION AND CONSULTATION. Sessions of the Imperial Conference at which Da Prime Ministers of Great Britain and the Deminions are all able to be present cannot, from the nature of things, take place very frequently. The system of communication and consultation between conferences becomes, therefore, of special portance. We summed up our conclusions in the following resolution, submitted for consideration:

A general understanding was reached that none of the Governments represented at the Imperial Conference would take any action in the direction of acceptance of the compulsory jurisdiction of the Permanent Court without bringing up the matter for further discussion.

The Governments represented at the Imperial Conference are impressed with the desirability of developing a system of personal contact, both in Laden and in the Dominion capitals, to suppleat the present system of intercommunication and reciprocal supply of information of affairs requirjoint consideration. The manner in which y new system is to be worked out is a matter consideration and settlement between His Majesty's Governments in Great Britain and the Paninions, with due regard to the circumstances

CRIST OF LEGISLATION The State Legislatures of 1926 enacted a larger aber of legislative bills than they did in the -year of 1924. Less than a dozen States hold yalar or biennial sessions in the even-numbered POL

Authoritative reports compiled by the National Industrial Council show that 1926 Legislatures in ren States considered 12,472 bills and enacted 4346 new laws, compared with the previous "off Hear" record of 1924 when 16,000 measures were introduced and 3.378 laws enacted.

In 1925 when forty States had regular annual, hantal or special sessions a total of 39,000 bills re introduced and over 11,000 new laws enacted. Following is a statistical summary of the work the 1926 State Legislatures:

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Bills Introduced. 117

Bills
Enacted.

55

348

Ketucky..

1,112

335

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Massachusetts.

1,071

454

Matsstppl (6)

1,988

New Jersey

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New York.

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Rhode Island.

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Death Carolina

467

rginia

1.250

593

Washington (c).

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Total 4.546 Extraordinary session; (b) Includes 112 District Boad Bond billa; (c) Resumed session of 1925 ran a few days into 1926. From the Industrial and business viewpoint, no mical bills were passed. There were introduced appropriation, 107 taxation, 84 workmen's pensation, 62 labor, 79 railroad, 43 insurance, constitutional amendments, 39 banking and 32 neral business law bills, besides hundreds of miscellaneous measures. Some minor amendments to the workmen's compensation insurance, labor and general business laws were adopted, none of

|

The special conditions upon which the United States desired to become a party to the protocol had been discussed at a special conference held in Geneva in September, 1926, to which all the Gov

had sent representatives. We ascertained that each of these Governments was in accord with the conclusions reached by the special conference and with the action which that conference recommended.

The Locarno policy and its results were explained and discussed. It then became clear that from the standpoint of all the Dominions and of India there was complete approval of the manner in which the negotiations had been conducted and brought to 80 successful a conclusion.

Our final and unanimous conclusion was to recommend to the conference the adoption of the following resolution:

"The conference has heard with satisfaction the statement of the Secretary of State for Foreign Affairs with regard to the efforts made to insure peace in Europe, culminating in the agreements of Locarno, and congratulates His Majesty's Government in Great Britain on its share in this successful contribution toward the promotion of the peace of the world."

IN 11 STATES IN 1926.
which involve in any way any great costs or radical
changes in existing laws.

in Massachusetts a substantial increase in tax-
ation of business corporations owning motor ve-
bicles was adopted. A proposal to levy a 2 cent
a gallon gasoline tax and attempts to increase the
excise tax on domestic corporations as well as increase
rate of taxation on income from intangibles were
defeated. Old age penston legislation was deferred
than annual sessions was defeated.
for further consideration. A bill for blennial rather

New Jersey lawmakers of 1926 made a record for new laws-341 measures being passed as against 248 in 1925 and 270 in 1924. An anti-injunction measure was passed which allows small group picketing in distances of ten paces apart and without interference with workers in their homes or going to and from places of business. Old age pensions. 48-hour work week for women and a bill to put teeth into the no-night-work-for-women law were defeated.

Rhode Island's 1926 legislative session also set a new high mark for measures both introduced and enacted. Old age pension bills were defeated, as were proposals to issue State licenses to engineers and firemen. Recommendations of the Rhode Island Commission on Children' Laws were incorporated in 22 out of 27 bills passed. These provide for the creation of a State Children Bureau, reorganization of the probation system and for a "work or school" law for youth from 16 to 18 years. Virginia's lawmakers enacted a complete revision of the taxing system.

The Kentucky General Assembly increased the highway improvement tax on gasoline from 3 cents to 5 cents a gallon and authorized employment of 10 per cent. of the State Prisons' population on highway construction. It also passed a law authorizing county fiscal courts to pension persons 70 years of age. Pensioners cannot have sources of income exceeding $400 per year or possess property valued at $2,500. Amount of pension must be fixed by County Judg and shall not exceed $250 per year. Mississippi adopted an anti-evolution teaching act.

BANKERS' MANIFESTO ON EUROPEAN TARIFFS.

tariffs altogether. Others have suggested the conclusion for long periods of commercial agreements embodying in every case the most-favored-nation clause. Some states have recognized in recent treaties the necessity of freeing trade from the restrictions which depress it. And experience is slowly teaching others that the breaking down of the economic barriers between them may prove the surest remedy for the stagnation which exists. On the valuable political results which might flow from such a policy, from the substitution of good will for ill will, of co-operation for exclusiveness, we will not dwell. But we wish to place on record our conviction that the establishment of economic freedom is the best hope of restoring the commerce and credit of the world.

A plea for the removal of restrictions on European | powerful voices are pleading for the suspension of trade was issued on Oct. 19, 1926, to the nations of Europe urging the tearing down of the barriers created by tariffs and other artificial restraints of trade so that commerce might flow in its natural channels unimpeded. It was signed by 200 outstanding bankers and business men-by forty-one from Great Britain, including Sir Arthur Balfour, Reginald McKenna, Montague Norman, Sir Felix Schuster, Lord Inchcape, Lord Revelstoke, Lionel N. Rothschild, Lord Novar and W. H. Coats; by nine leaders of finance in France, including R. P. Duchemin, Horace Finlay and R. Masson; by nine Germans, including Dr. Schacht, President of the Reichsbank, and Dr. Bosch; by sixteen from Austria fourteen Belgians;

ten Czechoslovakians; seven Danes; sixteen Dutchmen; twelve Hungarians; ten Italians; nine Norwegians; four Polanders: one Roumanian; nine Swedes; and from the United States by J. P. Morgan, Gates W. McGarrah and Albert H. Wiggin of New York, J. J. Mitchell and Melvin A. Taylor of Chicago, and Thomas N. Perkins of the Reparation Committee. The manifesto read:

We desire, as business men, to draw attention to certain grave and disquieting conditions which, in our judgment, are retarding the return to prosperity.

It is difficult to view without dismay the extent to which tariff barriers, special licenses and prohibitions since the war have been allowed to interfere with international trade and to prevent it from flowing in its natural channels. At no period in recent history has freedom from such restrictions been more needed to enable traders to adapt themselves to new and difficult conditions. And at no period have impediments to trading been more perilously multiplied without a true appreciation of the economic consequences involved.

The break-up of great political units in Europe dealt a heavy blow to international trade. Across large areas, in which the inhabitants had been allowed to exchange their products freely, a number of new frontiers were erected and Jealously guarded by customs barriers. Old markets disappeared. Racial animosities were permitted to divide communities whose interests were inseparably connected. The situation is not unlike that which would be created if a confederation of states were to dissolve the ties which bind them, and to proceed to penalize and hamper, instead of encouraging, each other's trade. Few will doubt that under such conditions the prosperity of such a country would rapidly decline.

One

To mark and defend these new frontiers in Europe, licenses, tariffs and prohibitions were imposed with results which experience shows already to have been unfortunate for all concerned. state lost its supplies of cheap food, another its supplies of cheap manufactures. Industries suffered for want of coal, factories for want of raw materials. Behind the customs barriers new local industries were started, with no real economic foundation, which could only be kept alive in the face of competition by raising the barriers higher still. Railway rates, dictated by political considerations, have made transit and freights difficult and costly. Prices have risen, artificial dearness has been created. Production as a whole has been diminished. Credit has contracted and currencies have depreciated. Too many states, in pursuit of false ideals of national interest, have imperiled their own welfare and lost sight of the common interests of the world by basing their commercial relations on the economic folly which treats all trading as a form of war.

There can be no recovery in Europe until politicians in all territories, old and new, realize that trade is not war but a process of exchange, that in time of peace our neighbors are our customers, and that their prosperity is a condition of our well-being. If we check their dealings their power to pay their debts diminishes and their power to purchase our goods is reduced. Restricted imports involve restricted exports, and no nation can afford to lose its export trade. Dependent as we all are upon imports and exports, and upon the processes of international exchange, we cannot view without grave concern a policy which means the impoverishment of Europe.

Happily there are signs that opinion in all countries is awakening at last to the dangers ahead. The League of Nations and the International Chamber of Commerce have been laboring to reduce to a minimum all formalities, prohibitions and restrictions, to remove inequalities of treatment in other matters than tariffs, to facilitate the transport of passengers and goods. In some countries

The Baltic group, Russia. Spain, Portugal, Jugo Slavia and Turkey were not represented. The French and Italian representatives affixed their signatures with a statement of clarification and reservation.

Secretary of the Treasury Mellon stated the position of the United States Government in a communication which appeared in the press on Oct. 25. He said in part:

"The situation in Europe since the war is dif ferent from the situation in America. The two would only become comparable if we should con sider each of the forty-eight States a separate nation, each having its own tariff, its own currency and Ita own language. Under such conditions the industrial power of the United States must and would end.

"What the plea of the bankers seeks to accom plish in its final analysis is not a change in the world but to bring about in Europe a condition similar to that in the United States. It is not criticism of us, but emulation.

"Nevertheless, our public thought and some of our press argued that because artificial barriers hinder readjustment in Europe we must change our tariff policy; but one cannot take a policy which is essential to the relief of Europe, under conditions arising out of the war, and say that this policy is proper for the United States, unless it can be established that conditions are the same. Conditions are not the same.

"The purpose of the policy in Europe is to provide a territory large enough to contain raw materials manufactures and a market, so that industry may function where coal and iron and laborers are con venient, and food may be produced where conditions for its production are favorable. No such limitation exists in the United States. We do not have to put a steel plant in Kansas or grow wheat around Gary, Ind. We have one transportation system; we speak one language, and we have one kind of money among 120 million people in an area the size of most of Europe outside of Russia.

The standard of living of Europeans is quite different from the standard of living of the United States. Unless we are willing to bring our standard in America down to the level of that of Europe, we cannot consider a change in our tariff, however desirable such a change may seem to Europe. "Our tariff policy has been mainly responsible for the development of manufacturing in America. Our tariff policy has brought to labor the highest real wages in history. The development of manufacturing has been accompanied by improved methods and quantity production, and we have been able to make and distribute at a relatively low price, considering the high cost of labor. many lines we more than meet foreign competition with its low labor costs. In turn, high wages have created a great consuming population, which has been the principal factor In our reaching quantity production and thus low costs. A study of the industries in this country shows a very small margin of profit per unit and large profits in the aggregate possible only through large turnover. These reasons, I think, account for the present exceedingly prosperous condition generally of our country.

In

"A fair survey of facts cannot lead to a conclusion other than that the economic policies of the United States, and their resulting industrial activity and prosperity, have played a leading role in aiding the world to recover from losses and damage wrought by

the war.

"The United States is the largest customer in the world to-day. If we were not prosperous and able to buy, Europe also would suffer. It is inconceivable to me that American labor will ever consent to the abolition of protection, which would bring the American standard of living down to the level of that in Europe, or that the American farmer could survive if the enormous consuming power of the people in this country was curtailed and his market at home destroyed."

THE DAWES PLAN SUCCESSFUL IN SECOND YEAR.

8. Parker Gilbert, formerly Under Secretary of the Treasury and Agent General for Reparations since Oct. 31, 1924, announced that Germany has "made loyally and punctually" all payments required under the Dawes Plan for the second reparations year, Sept. 1, 1925-Aug. 31, 1926, in his second sanual report, made public in Berlin Dec. 5, 1926. "For over two years," he says, "German currency has remained stable. Foreign loans and other fads from abroad have poured into the country in a steady stream to the point of exceeding at umes the capacity of German economy to make advantageous use of them, and the situation of German currency and exchange has grown conFantly stronger."

The year provided a test of Germany's capacity to pay and the capacity of the creditor powers to receive reparations on a substantial scale, and "actually the course of events has, if anything. outrun the expectations of the experts."

Germany's payments from the several sources under the Dawes Plan for the first five fiscal years (the last year, 1928-1929, being the first of the "standard years") are scheduled as follows: 1924 1925 1926 1927 19281925. 1926. 1927. 1928. 1929. In millions of gold marks. fat on R.R.bonds 200 595 550 660 660 Germ, ext. loan.. 800 Judget.. 250 500 1,250 290 290

Source.

fransport tax.

ut on German Indust, debent

Total...

iio

250

290

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F

300

1,000 1,220 1,200 1.750 2,500 (For the installation of the Dawes Plan see The World Almanac for 1925, pages 173-5; for its operalon during the first year see The World Almanac or 1926, pages 169-70.)

Germany made full payment of the second anTufty out of her own resources in the manner provided a the plan, and transfers to the creditor nations ave been made currently and without difficulty 9 an amount representing substantially the full alue of the second annuity. Germany co-operated nost helpfully in arranging to facilitate future payments; moreover, the troublesome question of bplemental contributions has been settled in a Ray greatly contributing to smooth the workings of the experts' plan. This was done despite the fact that German economy passed through a trying period 4 readjustment which approached a business risis in the winter of 1925-26, when many enterpres went out of existence, "to the great cost of Individuals but to the undoubted benefit of the antry as a whole." From it German industry and commerce "emerged freed of many encumbrances and complexities which were an inheritance the war and inflation, and business conditions general have now become easier than at any time ince stabilization."

Conclusion of any arrangement for the settlement ✰ two supplementary budget contributions by the ump sum payment of Rm.300,000,000 was an portant event. It is "significant of the spirit of riendly accommodation that has marked adninistration of the experts' plan and is a new sign If the good will and mutual understanding that le at the basis of the plan."

For the second annuity year beginning Sept. 1, 1925, and ending Aug. 31, 1926, the plan provided total annuity of Rm.1,200,000,000, of which Rm.250,000,000 came from the budget, a similar

from the transport tax, Rm.595,000,000 from Interest on the German Railway bonds and Rm.125,000.000 from first payments of interest on German Endustrial debentures.

The report emphasizes the facilitation of future annuities through arrangement of supplemental payments in a lump sum. Without such an arangement the annuities would have risen from Rm.1,200,000,000 in the third year to Rm. 2,000,00.000 in the fourth and Rm.2,750,000,000 in he fifth year, assuming that the maximum supple mentary contributions had become payable. would have meant an increased burden on German onomy of Rm.800,000,000 the fourth year and a further heavy increase in the fifth.

This

The new arrangement means that the third anulty will amount to Rm.1,500,000,000, the fourth Rm.1,750,000,000, and the fifth to Rm.2.500,00.000. The result is a better gradation of the annuities which will reduce the danger of undue train on German economy and facilitate an even low of deliveries and payments. With the coperation of the German Government arrangements have been made to spread the payments of the hird annuity through the year in a manner assuring arderly progress.

Distribution of reparation payments has proceeded

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regularly. There has been no accumulation of funds in the Agent General's hands beyond the normal working balance needed for the transaction of business and payments for the benefit of creditor powers, and the payments have been made without disturbing exchange,

The chief payments made were, in round figures: France, Rm.611,877,000, of which Rm.61,000,000 was for the Army of Occupation.

Great Britain, Rm.227,765,000, of which Rm.21,500,000 was for the Army of Occupation. Italy, Rm.87,310,000.

Belgium, Rm.125,877,000, of which Rm.9,000,000 was for the Army of Occupation. Servia, Rm.43,827,000.

United States, Rm.33,949.000.

Roumania, Japan, Portugal, Greece and Poland together about Rm.26,000,000.

France took over Rm.225,000,000 in coal, coke and lignite, nearly Rm.40,000,000 in chemical fertilizers, Rm.19,000,000 in timber and Rm.18,000,000 in agricultural products; Italy over Rm.65,000,000 in coal; and Belgium, Rm.61,500.000 in coal and coke; while the United States received nearly Rm.25,000,000 in dollar or gold equivalents.

Of the total transfers during the year, 35.35 per cent. was made in foreign currencies, Total transfers for the first two years amounted to slightly over Rm.2,690,000,000, of which 32.2 per cent. was in foreign currencies and the remainder in mark payments within Germany for deliveries in kind.

The Reparation Commission apparently feels the time has not come for placing part or all of the German Railway bonds on the market.

The

Only provisional figures for the first nine months of the year are available for railway earningsthese are slightly below the preceding year's figures, but an improvement is noted since August. Railway Company was able to meet all obligations during the period except a deficit of Rm.30,000,000, and the Railway Commissioner believes this deficit will be more than made good by the end of the year. The company paid punctually Rm.595,000,000 interest on the railway bonds, and also Rm.250,000,000 from the yield of the transport tax. The receipts from this tax actually amounted to Rm.368,700,000, leaving a surplus of Rm.18,700,000, which was turned over to the German Treasury.

Payment due from the transport tax in the third annuity year is Rm.290,000,000, and the Railway Commissioner believes with reasonably good business conditions the yield will reach the required total.

Controlled revenues for the second annuity year amounted to over Rm.1,968,000,000, indicating that the yield for the full twelve months will be 50 per cent. above the standard payment from the German budget. The budget balances for the financial year 1925-20 at Rm.8,006,400,000, with a balance of revenues over expenditures of Rm.562,000,000. This includes, however, a Rm.672,000,000 surplus appropriated from previous years. Expenditures, on the other hand, include Rm.395,000,000 in capital investments and grants, including Rm.231,000,000 in Railway Company preference shares. The budget estimate for the financial year 19261927 balances at Rm.8,431,000,000.

Among the taxation receipts, only the customs and consumption taxes show a considerable increase, rising from 21 per cent. of the total tax receipts in the fiscal year 1924-1925 to an estimated 31 per cent. for 1926-1927. The turnover tax is estimated at 15 per cent. of the total against 26 per cent. two years ago. The changes in other taxes are unimportant.

The largest expenditure in the budget consists of payments to states and communes. These absorbed 36 per cent. of the total in the fiscal year 1924-1925, 35 per cent. the following year and are expected to take 33 per cent. the coming year. The Agent General declares settlement of the financial relations between the Reich and states and communes "is the most troublesome problem affecting the structure of the German budget."

Mr.

The report regards expansion of the extraordinary budget as likely to become dangerous. That budget for the fiscal year 1926-1927 contemplates expenditures amounting to Rm.1,308,000,000. Gilbert questions the wisdom of the Reich's tying up great amounts in investments and also for "productive unemployment relief." He believes unemployment is less an inheritance from the business crisis of last winter than a phase of readjustment of the whole business system."

Foreign loans amount roundly to Rm.3,500,000.000 since the Dawes Plan went into effect. Service thereon, excluding the external loan of 1920, amounts to Rm.250,000,000 yearly, which "is not a heavy charge for an industrial and trading nation like Germany."

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able.

1,711,259,905.97 11,522,354,000

World War Foreign Debt Commission-Secretary and externally, these settlements are quite worl of the Treasury Andrew W. Mellon, Chairman; Secretary of State Frank B. Kellogg (succeeded Charles E. Hughes, March 9. 1925). Secretary of Commerce Herbert Hoover, Senator Reed Smoot, Representatives Theodore E. Burton and Charles R. Crisp, former Representative Richard Olney and Edward N. Hurley, Under Secretary of the Treasury Garrard B. Winston, Secretary (succeeded Mr. Eliot Wadsworth, Aug. 6, 1925).

The total principal amount of obligations of foreign governments originally held by the Treasury was $10,338,058,352.20. Debt-funding agreements executed pursuant to the authority of the act of Feb. 9, 1922, as amended by the act of Feb. 28, 1923, and as further amended by the act of Jan. 21, 1925, providing for the funding of $9,811,094,094.03, principal amount of obligations of foreign governments held by the Treasury, have been concluded with the Governments of Belgium. Czechoslovakia, Esthonia, Finland, France, Great Britain, Hungary, Italy, Latvia, Lithuania, Poland, Roumania and Jugo-Slavia. These settlements cover more than 97% of the total principal amount of obligations held by the United States when the commission was created by Congress, Feb. 9, 1922, for three years. Its life was extended for two years and terminates Feb. 9, 1927, and Secretary Mellon does not believe further extension necessary.

Greece has not funded its debt, but has requested additional advances under credits heretofore established, and the matter is now before Congress. If the occasion should subsequently arise to undertake negotiations covering debts not yet funded, the matter might be handled informally by the Secretary of the Treasury with such former members of the debt commission as are in Washington and reported direct to Congress.

POLICY OF THE COMMISSION. The policy of the commission as set forth by Secretary Mellon will be found in The World Almanac for 1926, pages 171-2. The Secretary of the Treasury in his report dated Nov. 20, 1926, says in part:

"The policy pursued was to treat each debtor nation on the basis of its particular capacity to pay the debt. The first element was time. No one likes to pay a creditor over a sixty-two-year period. But if the whole debt cannot be paid on demand, no other course was open except to extend the period of repayment. This was done in the first settlement, that with England, and similar extensions have been granted to all other nations. The second problem was the amount to be paid in the earlier years. It is these years that are the most difficult. because post-war readjustments are still incomplete, and it is here that America has been most lenient. No debtor nation will deny that the payments provided for these earlier years are well within its capacity. The third question was the later years. No one can insure the future, but given normal conditions, it is believed a true balance has been held between the duty of the debt commission to the American taxpayer and fairness toward those nations to which was extended aid during and after the war.

"The debts have not been canceled, but the impossible has not been demanded. Since these settlements, England's excepted, have but recently been completed, the American debt has meant practically nothing to Continental Europe in the eight years since the armistice, and it cannot become too heavy a load in the next few years. Thereafter, much depends upon the progress of the world. With peace and the development of trade, internally

"From abroad has come again the suggestic between themselves and with the United Stat that the indebtedness of the nations of Eurof should be canceled or should be pooled and a gener joint settlement take place. This suggestion bi been presented in various forms, but upon analy its essential basis seems to be a belief that in the nature of subsidies and were, therefor advances of the United States during the war we tributions to a joint undertaking and should not loans at all, or that these advances were co settled jointly by clearing one against the othe The position of the debt commission that the vances were loans to be repaid and that each de must be refunded on the basis of the capacity sistent policy of the United States from the firs pay of the particular debtor has been the co Until the war ended no intimation was made the these advances were subsidies, or that they we contributions to a joint cause, or that they wou be the subject of a general pooling after the war

The total payments on account of princip of the funded obligations up to Nov. 15, 193 were $80,716,915.50, of which $5,707,639.12 W in cash and the balance in United States oblig tions. The total payments on account of intere were $484,955,627.32, of which $54,502,885.53 in cash, $178,780.50 in bonds of the debtor ge ernments, and the balance in United States oblig tions.

The funding agreements with Esthonis, Finlan Great Britain, Hungary, Lithuania, Poland Roumania have been ratified by the United Stat and by their respective Governments, and the ne obligations provided for in the funding agreemen have been delivered to the United States. T agreements with Belgium, Italy and Latvia hay been ratified by the United States and the severi debtor Governments. The agreement with Czech slovakia has been approved by the United State The commission has not yet been notified tha action to ratify the agreement has been take by the Czechoslovak Republic. The agreement with France and Jugo-Slavia have been approve by the House of Representatives, but not by th Senate. The French Government has not ratified the agreement with France, while agreement with Jugo-Slavia has been approve. by that Government.

THE FRENCH SETTLEMENT.

After the failure of the negotiations on the French debt, conducted in Washington in 1925, by M Joseph Caillaux, then Minister of Finance, the subject was reopened on Jan. 23, 1926, by Senato Henry Berenger, the newly appointed Frenc Ambassador at Washington. Settlement of the debt was authorized at a meeting of the commis sion on April 29, 1926. The funding agreement was signed and approved by the President the same day. It has been approved by the House of Representatives, but has not yet been approved by the Senate. It has not yet been ratified bo France. (See pages 615-16.)

The amount of the debt funded was calculated on the same basis as in previous settlements; that is, with interest at 44% to Dec. 15, 1922, and 3 thereafter to June 15, 1925, the date of the agree ment. After deducting a cash payment of $386,686.89, made upon execution of the agreement. the total indebtedness funded into bonds $4,025,000,000. This amount is to be paid in annuities commencing with $30,000,000 in first year and rising to $125,000,000 in the seventeenth year, continuing at this figure until the sixty-second year, when the amount will be $117.

the

commission returned to Belgrade for further instructions. On May 1, a settlement was reached and the funding agreement was signed May 3, and was approved by the President the same day. The agreement has been approved by the House of Representatives but has not yet been approved by the Senate. It was approved by Jugo-Slavia on June 19, 1926.

674,104.17. A statement of the amounts payable | There was a lapse in the negotiations while the annually to the United States appears as exhibit 31, page 242. Under these annuities the total principal -funded will be repaid in full with interest thereon as follows: After the first five years and for the Dext ten years, 1% per annum; for the next ten years, 2% per annum; for the next eight years, 14% per annum; for the next seven years, 3% per annum: and for the remaining twenty-two years, 3% per annum. Over the entire period the United States will receive $6,847,674,104.17. The principal of the debt of France at the time of funding amounted to approximately $3,340,

000,000.

ROUMANIA AND JUGO-SLAVIA.

The amount of the debt funded was calculated on the same basis as other debt settlements at 44% Interest to Dec. 15, 1922, and at 3% interest thereafter until June 15, 1925, as of which date the debt was funded. The total debt funded, after allowing for a cash payment of $7,112.39,. made upon execution of the agreement, was $62,850,000, of which $51,037,886.39 represented principal and $11,812,113.61 represented accrued interest.

A Roumanian Debt Commission, headed by Mr. N. Titulescu, Roumanian Minister at London, sppeared before the commission on Nov. 9, 1925. and settlement was agreed upon, Dec. 1, 1925; igned Dec. 4, and approved by the President the me day. It was ratified by Roumania, March 6, 1926, and was approved by Congress, May 1926. The principal of the debt funded is fixed of June 15, 1925. Interest on the $36,128,494,94 riginal Indebtedness was calculated at 44% per innum to Dec. 15, 1922, and from then until June 1925, at the rate of 3% per annum, making he principal of the debt funded $44,590,000, after educting a payment in cash of $4,451.54, made Roumania upon execution of the agreement. he principal is to be paid over a period of sixty-made in 1919 and 1920 sent a commission who Greece whose debt is $15,000,000 for advances years with interest at 3% per annum for the rst ten years and 34% per annum thereafter. began negotiations on Jan. 14, 1926, and wished Yuring the first fourteen years, however, the folto make settlement conditional on the receipt of further advances. wing total amounts are to be paid, the balance The subject was still under each annuity at the above interest rates being unded over the remaining forty-eight years: June 1926, $200,000: June 15, 1927, $300,000; June 1928, $400,000; June 15, 1929, $500.000; June 1930, $600,000; June 15, 1931, $700,000; June 15, 932. $800,000: June 15, 1933, $1,000,000; June 1934, $1,200,000; June 15, 1935, $1,400,000; ne 15, 1936, $1,600,000: June 15, 1937, $1,800,09 June 15, 1938, $2,000,000; June 15, 1939, 2,200,000.

Under the agreement annuities commence with $200,000 a year for the first five years, increasing the remaining fifty years payments on account $25,000 a year the seven succeeding years. During of principal increase annually. Beginning with rate of one-eight of 1% for three years, one-half the thirteenth year interest commences at the of 1% for the next fourteen years, 1% for the next three years, 2% for the next three years, and 3% period. for the last twenty-seven years of the debt-funding

A Jugo-Slav Debt Commission,
Dr. Milan
Bayadinovitch, Minister of Finance, Chairman,
#peared before the commission, Jan. 27, 1926.

discussion, Nov. 15, 1926.

The agreements made with Belgium, Czechoslovakia, Esthonia, Italy and Latvia, in 1925, will be found in The World Almanac for 1926, pages 171-2.

Austria was given a moratorium until June 1, 1943, by act of Congress on her debt of $11,959,917 for relief supplies. No Russian government is recognized by the United States; the Russian debt totals $192,601,297. There is no Armenian goyernment in existence; her debt for relief supplies was $24,055,709. Liberia (depot about $30,000) is expected to pay in cash.

REVIEW OF CONGRESSIONAL LEGISLATION IN 1926.

The first session of the Sixty-Ninth Congress vened on Dec. 7, 1925, and adjourned on July 1926. During the session 18,230 bills and joint lutions were introduced and about 700 public lls and resolutions enacted into law. This comres with 21.071 bills and resolutions introduced laring the entire Sixty-Seventh Congress, and 7.472 during the Sixty-Eighth.

Among the more important matters of general Aterest enacted were:

The Tax Bill, known as the Revenue Act of 1926. The Public Buildings Bill, authorizing approprias of approximately $165,000,000 for the purLase of sites and the erection of adequate buildings or governmental occupancy and use.

The Watson-Parker Railroad Labor Disputes Bill, abolishing the Railroad Labor Board and reating a Board of Mediation.

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ative Marketing in the Department of Agriculture. The Federal Highway Áld Bill, continuing appropriations for two years, to be expended in cooperation with the various States.

Three bills relating to the development of aviation: A civil, a military, and a naval bill.

The bill for codification of the Federal statutes, which has been pending through several Congresses. An amendment was adopted before passage of the bill, however, providing that the act is to be evidential of the pre-existing law only, and is not to be deemed a code of debt settlements.

Two important bills passed by both Houses, but in different form, sent to conference, were the Radio Bill and the Branch Banking Bill. The conferees were unable to reach an agreement on either of them, which means that the conference reports were before Congress in December. The second session met in December and resumed

The Haugen bill creating a Division of Co-oper-Its task where it was left off.

PROPOSED CONSTITUTIONAL AMENDMENTS NOW BEFORE CONGRESS.

Approximately forty proposals were introduced oking to amendment of the Federal Constitution. The subjects covered were: Child labor minimum Tages; equal rights for men and women, marriage and divorce, tax-exempt securities, method of delaring war, drafting of industrial property, prohibidon, making persons born of allen parents ineligible to citizenship, themselves ineligible to citizenship: ethod of amending the Constitution (WadsworthGarrett and Norris-White proposals).

The Norris-White proposal passed the Senate on Ieb. 15, 1926, and was favorably reported by a House Committee on Feb. 24, with an amendment substituting the language of the White resolution. As amended, the proposal provides that the terms the President and Vice President shall end at noon on Jan. 24, and the terms of Senators and Representatives at noon on Jan. 4; that Congress all assemble annually, which assembly shall be on Jan. 4, unless a different day shall be appointed y law; and provision is made for cases in which the election of the President shall be thrown into The House of Representatives.

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The Wadsworth-Garrett proposal, which sent to the Judiciary Committees of the House and the Senate, proposes a substitute for the present Article V. of the Constitution, relating to the method of adopting proposed amendments. It provides that an amendment may be proposed either by two-thirds of each House of Congress, or through a national convention called on application of the Legislatures of two-thirds of the States. Any proposal thus submitted would become a part of the Constitution when ratified by three-fourths of the States, either through their Legislatures or by conventions, whichever method of ratification might be directed by Congress or a national convention. At least one House in each of the State Legislatures which may ratify a proposed amendment must have been elected after such amendment was proposed; and any State may require ratification by its Legislature to be subject to confirmation by popular vote. Under this amendment it would be specifically stated that any State has the right to change its vote at any time before the necessary three-fourths of the States have ratified, or more than one-fourth have rejected.

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