Date: May 6, 1931
Location: Northampton, MA
Summary: Calvin Coolidge refutes the argument that the United States government should cancel the debts of foreign nations to increase trade.
(Original document available here)
Without considering at all the financial or moral obligation of foreign governments to pay their debts to our government or the obligation of our government to collect them, it is interesting to see what is involved in the argument that the debts should be canceled to increase trade. Fundamentally this means the most enormous subsidy to foreign commerce that was proposed. This has a strange sound in the vocabulary of those who advocate that trade should be free and unrestricted. We would be involved in subsidizing the trade of foreign people out of money collected from our own people.
If this policy is to be adopted, if our taxpayers are to begin paying the taxes of foreign people supposedly in order to increase their power to trade with us, there is no reason to limit the process to those who happen to owe our government. The principle would require a broader application. It would be logical to select all countries where an argument could be made that if our Treasury would bear a part of their tax burden they might enlarge their commerce with us. If we adopted this principle logically we should open our Treasury to all the world.
Citation: Calvin Coolidge Says: Dispatches Written by Former-President Coolidge and Syndicated to Newspapers in 1930-1931 (Calvin Coolidge Memorial Foundation)
The Coolidge Foundation gratefully acknowledges the volunteer efforts of David Wang who prepared this document for digital publication.