i6o A REVISION OF THE TREATY chap.

Mr. Harding's Administration to secure for itself afree hand to act wisely in this matter (and evenperhaps generously) in accordance with the progressof opinion and of events.

The decisive argument, however, for the UnitedStates, as for Great Britain , is not the damage toparticular interests (which would diminish with time),but the unlikelihood of permanence in the exactionof the debts, even if they were paid for a short period.I say this, not only because I doubt the ability of theEuropean Allies to pay, but because of the greatdifficulty of the problem which the United States hasbefore her in any case in balancing her commercialaccount with the Old World.

American economists have examined somewhatcarefully the statistical measure of the change fromthe pre-war position. According to their estimates,America is now owed more interest on foreign in-vestments than is due from her, quite apart fromthe interest on the debts of the Allied Governments ;and her mercantile marine now earns from foreignersmore than she owes them for similar services. Herexcess of exports of commodities over importsapproaches $3000 million a year ; 1 whilst, on theother side of the balance, payments, mainly toEurope, in respect of tourists and of immigrant

1 In the year of boom to June 1920, on a total trade of $13,350million, the excess of exports over imports was $2870 million. Inthe year, partly one of depression, to June 1921, on a total trade of$10,150 million, the excess of exports was $2860 million.