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Ridpath's History of the World

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armistice provided that the cost of occupation should form a first claim upon indemnities exacted from Germany, the United States had never obtained any money to pay the cost of maintaining troops in the occupied zone and was out a sum amounting to $250,000,000. Negotiations with the Allied governments concerning this matter proved unsatisfactory and served to bring out the selfish grasping policy of some of our former associates in the war.

Almost equally unsatisfactory were negotiations concerning debts owed by Allied governments to the United States. This debt, with unpaid interest, amounted by 1922 to about $11,000,000,000. Early in that year Congress passed an act providing for a commission to refund or convert this debt and to extend the time of payment, provided, however, that the maturity of any obligation should not extend beyond June 15, 1947. Our debtors brought forward a great variety of arguments for our canceling these debts altogether, and some sentiment in favor of such a step was expressed by certain Americans, notably by those anxious to sell goods in Europe. But public sentiment was in the main in favor of collecting the debt. On October 16, 1922, Great Britain made an interest payment of $50,000,000, and turned over a like sum on the 15th of the following month. Early in January, 1923, a British financial mission, headed by Stanley Baldwin, Chancellor of the Exchequer, arrived in the United States and after protracted negotiations an agreement was finally reached between the two governments regarding payment of the debt. The total sum, including unpaid interest, amounted on December 15, 1922, to $4,604,128,0855.74. Of this amount $4,128,085.74 was to be paid in cash. For the remainder British bonds were to be issued to the United States at par, bearing interest at three per cent, payable semi-annually, the principal to be payable in installments for sixty-two years, with the privilege of earlier payment on any interest date upon ninety days' notice.

Efforts made to reach similar understandings with France and other debtor nations failed. It seems altogether probable that a large part of the money advanced by us to our allies during the war will never be repaid.

On February 24, 1923, President Harding transmitted to the Senate a special message asking its consent to the participation of the United States in the International Court of Justice established under the auspices of the League of Nations at The Hague. At the same time he made it clear that such adhesion should not involve any legal relation to the League of Nations or the assumption of any obligations by the United States under the terms of the Covenant of the League of Nations. The proposal was well received by the general public, but it became apparent that it would be opposed by a number of Senators, including certain so-called "irreconcilable" Republicans.

Meanwhile business conditions had been rapidly improving. During 1922 stocks and bonds rose far beyond their lowest levels, and by 1923, instead of lack of employment, there was actually a dearth of workers. Despite many unsolved problems, including that of high taxes, it was clear that the United States, despite the direful predictions of pessimistic prophets, was entering upon a new era of prosperity.

Unfortunately the financial condition of the farming class did not improve so rapidly as did that of most other classes. During the war farmers had upon the whole enjoyed a period of seeming, and in some cases, actual prosperity. Prices of their products soared to unprecedented heights, and many failed to see that these conditions could not continue indefinitely. Many farmers raised their standards of living and neglected to save any of their profits for the proverbial rainy day. Prices of farm lands rose far beyond the amount at which ordinary farming can be made to pay, and optimistic individuals bought farms at inflated prices, often going heavily in debt. It was inevitable that when the war ended, Europe, burdened with debt and no longer aided by American loans, would be unable to buy American farm products to the same extent as hitherto. This falling off began in 1920, and the prices of farm products declined

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