Beginning on October 2, 1917, a continuous issue of 4 and 5 per cent. National War Bonds was made, the difference in the rate of interest being due to the tax exemption. The temporary and short time paper was gradually funded into these bonds. In the meantime the Anglo-French loan of $500,000,000, of which England had one-half, had been contracted in the United States; and with the entrance of the United States into the war on April 6, 1917, continually larger sums were borrowed from the American Government. During the period of the war the British debt rose from £650,000,000 to £7,643,000,000 or from $3,115,000,000 to $37,221,000,000. It is expected that $250,000,000 will be borrowed during the year 1919—20, so that in all probability the debt of Great Britain at the end of 1920 will amount to almost £8,000,000,000, or $38,500,000,000, meaning that the war debt probably will amount to about £7,500,000,000, or $35,000,000,000.

France was in a far less favorable situation than England at the outset of the war. The total debt of France at the close of 1913 amounted to fr. 32,594,000,000, or $6,291,000,000, and the ordinary budget had closed with a large deficit. So that it had been necessary to issue a loan during the spring and summer of 1914. When the war suddenly broke out, precipitating an economical and financial crash, it became practically impossible to issue another loan. The government was therefore compelled to rely upon advances from the Banque de France, which was permitted correspondingly to increase its notes issue. It was not until November, 1915, that France saw her way to issue her first war loan of 5 per cent. bonds. This was followed on August 6, 1916, by the second war loan, also of 5 per cent. bonds, on December 15, 1917, by the third war loan of 4 per cent. bonds, and on Dec. 15, 1918, by the fourth war loan, also at 4 per cent. The first war loan issued at 88 yielded $1,894,000,000; the second, at 83.75, yielded $1,981,000,000; the third at 68.60 yielded $2,914,000,000 and the fourth at 70.8 yielded $5,382,000,000. Meanwhile National Defense Bonds were issued continuously from February 25, 1915, and foreign loans had been contracted in England, in the United States and in Japan. The result was that at the close of the year 1918 the French debt amounted to fr. 167,469,000,000 or $32,322,000,000. This meant that the debt due to the war amounted to fr. 134,875,000,000 or $26,031,000,000. It is expected, however, that a considerable sum will still have to be borrowed during the year 1919, thus bringing the total French debt to 27 or 28 billions of dollars.

Courtesy McClure's Magazine

While the Men Fought, Those Left Behind Bought Bonds

Not all brave hearts beat under khaki during the war. More than $20,000,000,000 was raised by the four Liberty Loans and the Fifth Victory Loan. Among those who bought bonds were hundreds of thousands of wives and children of the men at the front.

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Russia was the first of the Entente Powers to issue public loans. On September 14, 1914, it issued a 5 per cent. loan at 94, yielding $259,000,000. This was followed at regular intervals by six more loans prior to the revolution of 1917. After the revolution there was considerable confusion which, of course, was much accentuated by the advent of Bolshevism. The consequence was that the public debt of Russia, which amounted for July, 1914, to $4,623,000,000, increased by the time of the October revolution in 1917 to 49,288 millions of rubles or 25,383 millions of dollars. This would mean a war debt of almost twenty-one billions of dollars. As a matter of fact of course it is very uncertain whether the debt will ever be redeemed at these figures.

The debt of Italy before it entered the war amounted to lire 13,636,000,000 or $2,621,000,000. Italy started at once with a so-called mobilization loan followed by its first war loan in July, 1915, and successive war loans on the first of January of each of the following years. The result was that on October 31, 1918, the total debt amounted to lire 63,093,000,000 or $12,177,000,000. By the end of May, 1919, the debt had grown to 77,763,000,000 lire or $15,009,000,000 leaving as the war debt lire 64,127,000,000 or $12,388,000,000.