is due us from Europe about 1.8 billion dollars on funded indebtedness, about 2.9 billion dollars on unfunded indebtedness and about 11 billion dollars on obligations to the American Government, the last being for advances to foreign governments during the war and interest subsequently accrued. How much of the last we shall collect nobody now knows. Great Britain will undoubtedly pay her indebtedness in full. The other countries will want to do so, but it is question- able whether they can. Some of the distinguished economists of Europe say that they will be unable to do so.
Thus, John Maynard Keynes in a recent article entitled “America and Cancellation” in the London Sunday Times said:
“The sum which Great Britain owes to America is one which, if necessary, Great Britain can pay. But it is not likely that the sums that the other European Governments owe America can be repaid in any case. It is right that American opinion should face this distinction. There are reasons of material self-interest for cancelling the European debt which do not apply to the British debt. Arguments for all around cancellation are partly trade arguments and partly on grounds connected with the origin of the debt which are not chiefly economic.”
Whether the United States ought or ought not to cancel the foreign bills that are owed to our Government is a subject that will be discussed in the next chapter. For the present let us conclude that we must anyhow regard a substantial part of our foreign book assets as accounts due us that are of doubtful collection.
