Bargaining Begins

At Paris the long expected Franco-Soviet Debt Conference got under way. Premier Briand gave it his benediction with the usual and now hackneyed invocation of "the Spirit of Locarno." There followed speeches slightly more to the point by the chief negotiators, the French Minister of Public Works and the Soviet Ambassador to France.

Minister De Monzie: "France will not forsake the mass of French investors of small means who were the benevolent clients of that Russia of which the Union of Soviet Republics is the legal successor and whom we are bound in honor to protect.

"Each of our nations respects the internal sovereignty of the other and the conference about to begin implies our solemn adherence to the principles of nonintervention. . . .

"Having become more mindful of results than the form in which they may be obtained, we are ready to discuss means which will permit the liquidation of past burdens by rearranging or valorizing present resources."

Ambassador Rakovsky: "I must declare that since 1919 we have proclaimed the desire to find a solution of the debt problem which will satisfy the little bondholders. Because of erroneous conceptions as to what has happened in Soviet Russia it has not always been seen in France that the solution of such a problem must be purely practical and take account not only of the interests of the French bondholders, but also of the changes in the psychology of the peoples of the Soviet Union and the necessity they are under of obtaining material assistance such as will permit them to contract new obligations.

"Facing this problem today, we are happy to note the realistic tone of the speech by the President of the French delegation."

The Significance. While these intentionally high-flown phrases cannot be said to pin down either side to anything, they were interreted very generally as follows:

1) France has abandoned all intention of pressing for repayment under the international agreements and Tsarist laws in force when the debts were contracted.

2) Soviet Russia is apparently determined to make repayments only in the form of higher interest than usual on further loans to be made to her by France. It was declared unofficially that new loans at 7%, with 4% additional "on account of debts," were in the minds of the Russians last week.

Oil? Extremely well authenticated reports from Paris indicated that the Russian Commission was empowered to negotiate the granting of Russian oil concessions to French capitalists, in return for which the loans just mentioned would be advanced to Russia. Fiscal experts opined that unless the Soviets are willing to bind their bargain by well protected concessions of this nature, no bargain will be struck.