Schacht for Peace?

Breathless in pace and implications was the swooping Balkan air tour last week of autocratic German Reichsbank President Dr. Hjalmar Schacht, whom closest friends call "Willy." In Vienna, Belgrade, Athens, Sofia and Budapest the Machiavellian doctor had fun insisting that he flew only to promote "economic peace." Just before he took off for Berlin, however, tactless Dr. Schacht could not resist blurting out what kind of economic peace he promotes. "Do creditor countries desire to renounce their claims against Germany?" he asked sharply. "If so they should say so, as Germany must either be allowed to earn and pay or to default!"

From dazzled Austrians, Yugoslavs, Greeks, Bulgars and Hungarians, through whose central banks Dr. Schacht had swept like a meteor last week, deigning to dine with premiers, having audience with King George of Greece, Tsar Boris of Bulgaria and accepting the Hungarian Cross of Merit, First Class, from the fingers of Regent Horthy, correspondents gleaned Schacht facts.

The doctor had sat up all night in Vienna with ever-scheming Franz von Papen and Austrian financiers; he was greeted in Belgrade with an order for German heavy industrial products almost huge enough to wipe out the $8,000,000 Germany owes Yugoslavia; and in Athens the swashbuckling entourage of Premier General Metaxas said talk had all been of deals involving German aircraft, artillery and four destroyers for Greece. In Sofia there was a matter of some Bulgar credits in Germany now secretly liquidated in great part by German shipments of arms to Italy for which Italy paid Bulgaria by canceling debts Bulgaria previously owed Italy; and as for the Hungarians they are now such large creditors of Germany that they simply have to buy more from the Reich.

Broader Schacht facts were that in the past two years Germany has become Hungary's best customer, the greatest exporter to and buyer from Yugoslavia. By Schacht barter deals, Germany is now selling the Balkan countries manufactured goods, possibly at as much as 50% below cash prices in exchange for their raw stuffs. French heavy industry, which used to have Yugoslavia economically in its pocket, is gradually being frozen out. With a Radical Cabinet now ruling France, conservative or reactionary Balkan regimes look increasingly to Berlin.

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