Courtesy Reuters

Political Aspects of Foreign Loans

THE United States is at the beginning of a new era of foreign lending. It will be called upon to provide many other countries with goods and services far in excess of their immediate capacity to pay. The most urgent requests will be put forward by those countries that have suffered the greatest loss in the war. Partnership in arms gives them a claim upon our help. Furthermore, the United States is now deeply engaged in a common search with other countries for a new basis for international political life. A readiness to grant loans within the limits of the reasonable is an essential counterpart of the leadership we have assumed in the political realm. For these reasons, and because it conforms well with our economic position, the United States is ready, I believe, to enter into a new program of foreign lending.

The attitudes with which we will enter upon this program are very different from those that prevailed after the last war. We had then the innocent sense that victory had ended the danger that threatened us and expelled the evil we detested out of the world. The task ahead seemed a simple one of economic reconstruction and we marched into our lending activity without asking whether it was compatible with our isolation, and without reckoning its political consequences. A hopeful sense prevailed among us that the capital we were providing would somehow or other bring back the tranquillity that had prevailed in Europe before 1914. With easy complacence we trusted Germany just as much as we trusted our former allies. Moreover, the extreme character of the Communist revolution that had taken place in Russia cut us off from almost all traffic -- economic and diplomatic -- with that nation, and only a few Americans were fully aware of the significance of the gradual reëmergence of Russia into world affairs.

We are today deeply aware of the fact that events abroad affect our lives. In the next few years

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