World War Foreign Debts Commission Act
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The United States federal World War Foreign Debts Commission Act of February 9, 1922 authorized the creation of a commission, working under Secretary of the Treasury Andrew Mellon, to negotiate repayment agreements with Great Britain and France in the aftermath of World War I. [1]
The Commission placed the Allied debt principal to the United States at $11 billion; payments were to be made in graduated 62 annual installments; however, the accrued interest on these payments over a period of 62 years would have increased the debt to approximately $22 billion, although the U.S. did agree to lowered interest rates. Great Britain's debt was reduced 19.7% to $4.6 billion with the interest rate reduced from 5% to 3% for the first ten years of payment to be raised to 3½% thereafter. France's debt was reduced by 52.8% to $4 billion, without any interest for the first five years of payment. It was then to be increased gradually to 3½%.
References
- ^ Wood, Robert (1986). From Marshall Plan to Debt Crisis: Foreign Aid and Development Choices in the World Economy. University of California Press.
Report of the World War Foreign Debt Commission, May 2, 1923 https://www.finance.senate.gov/imo/media/doc/68PrtSDOC23.pdf
Negotiations on behalf of the World War Foreign Debt Commission for the settlement or refunding of debts owed the United States by foreign governments (Documents 116–143) https://history.state.gov/historicaldocuments/frus1922v01/ch3
Combined Annual Reports of the World War Foreign Debt Commission with Additional Information Regarding Foreign Debts Due the United States: Fiscal Years 1922, 1923, 1924, 1925 and 1926 https://books.google.com/books/about/Combined_Annual_Reports_of_the_World_War.html?id=6ovPAAAAMAAJ
Foreign Indebtedness to the United States, Committee on Finance, US Senate, October 29, 1973 https://www.finance.senate.gov/imo/media/doc/foreign1.pdf
Complications for the United States from International Credits: 1913 -1940, George J. Hall Thomas J. Sargent, June 18, 2019 http://www.tomsargent.com/research/IMF_final.pdf
P.L. 67–139; 42 Stat.363, February 9, 1922 – Established the commission; five members P.L. 67-445, 42 Stat. 1325, February 28, 1923 – Increased membership to eight P.L. 67-327; 43 Stat. 763, January 21, 1925 – Extended life of Commission for two more years
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