AUTOBIOGRAPHY of G. K. CHESTERTON-^/w

THE TABLET A WEEKLY NEWSPAPER AND REVIEW

ESTABLISHED 1840 REGISTERED AS A NEWSPAPER

YOL. 168 No. 5032

LONDON OCTOBER 17th, 1936

SIXPENCE

PRINCIPAL CONTENTS

THE WORLD WEEK BY WEEK . . .509

THE “NEW MODEL” GOLD STANDARD—WHO CONTROLS THE CURRENCY ? ; THE INDEPENDENCE OF BELGIUM ; M. THOREZ ; THE EMBARRASSMENTS OF M. BLUM ; TRUCE IN PALESTINE ; DEPARTURE OF STARHEMBERG ; THE LEAGUE AND PROPAGANDA ; MEN FOR THE ARMY ; ON TO METHUSELAH LEADING ARTICLES 512

THE MISSIONARY ; THE MAGIC OF DESCRIPTION ABYSSINIA RE-VISITED, I ............................. 513

By EVELYN WAUGH RELIGION IN THE AGE OF REVOLUTION. 516

V.—The Turn of the Tide By CHRISTOPHER DAWSON CATHOLIC ACTION IN SPAIN, II . .. 517

By H. L. FRIEND THE ROME LETTER........................................ 520

THE CHURCH ABROAD ............................. 521

AFRICA ; ALSACE ; AUSTRIA ; BELGIUM ; BRAZIL ; CHINA ; FRANCE ; GERMANY AN AUTOBIOGRAPHY, V I I ............................. 525

By G. K. CHESTERTON THE BEDA ASSOCIATION............................. 529 BOOKS OF THE WEEK ............................. 530

THE TRADE CYCLE ; COMMONWEALTH AND RESTORATION ; REPERUSALS AND RE-COLLECTIONS ; LAUGHING GAS THE VENERABILE 534 CHESS AND CROSSWORD............................. 538 APOSTOLATE OF THE COUNTRYSIDE .. 539 THE CALENDAR ........................................ 540

THE WORLD WEEK BY WEEK The “New Model” Gold Standard

One of the immediate benefits of French devaluation of the franc has been the understanding between Britain, France and the United States, whereby their exchanged equalisation funds may turn excessive holdings of each other’s currencies into gold. This is a courtesy and a convenience, and places gold in a position for which it has long been destined as an excellent accessory in the business of international trade. The special points of gold, its general acceptability, its durable and portable characters, make it particularly suitable as a makeweight when, on a balance on trading, one country has to put something further into its side of the scale. The new arrangement is in no sense a step towards the restoration of the old gold standard, the system by which all money was convertible at the choice of the holder into gold. That system had the fatal defect that movement of gold on quite a small scale led to the contraction or expansion of the volume of money available in any particular country. Today the volume of money is not allowed to depend on the amount of gold from any one centre, and we are freed from forced deflation from outside, the drawing in of bank advances and refusal of loans, not because their purposes were unproductive, but because the volume of money had to be lessened to keep it in fixed relation with the amount of the precious metal in the country. The pound today has to keep in step with the dollar, and the value of the dollar has been kept more stable by the Roosevelt administration, and is the leading example and the dominant one of the managed currency today. But the English have now a long tradition of currency management because the gold standard of the last century called for, and received a great deal of careful management. The right to convert bank notes or cheques into gold was always nominal, in that it could only be exercised provided the great majority of people were content not to exercise it. But the financial history of England, in particular the story of the paper pound, between 1797 and 1821 between 1914 and 1925, and since 1931, shows that it is quite needless to fear in this country that the absence oi metallic anchorage means an illimitable slide to inflation and a worthless currency. Who Controls the Currency ?

A correspondent in this issue of T he T ablet draws attention to the independence of the Bank of England, as quietly but firmly reiterated in Mr. Montagu Norman’s speech. The relations between the Treasury and the Bank of England were very formal down to the War. The Government was a client whose accounts were carefully kept by the Bank, and a weekly meeting between the Treasury and a Bank official was the full extent of the contact thought necessary. But the influence of the City, and British money interests all over the world was constant on the Governments of the day, and the fear that funds would leave London, with disastrous consequences for the country, set a practical limit to what statesmen could do or suggest. Statesmen and Treasury officials accepted as axioms such ideas as that money must be free to come and go at will, and to seek its highest rate of profit in any part of the world. Assumptions that were the very air that was breathed in London down to a few years ago are now being increasingly challenged, and the last five years have convinced even reluctant Civil Servants reared in the old tradition, that the Government must maintain authority over its currency. We agree with the Economist that the freedom of the Bank from legal obligation to do what the Government wants done, in fact increases the independence of the Ministers and the Treasury from House of Commons control. The House of Commons has great powers of investigating the official actions of ministers, but it has little power over the wishes they or their officials may express to independent outside parties. The House of Commons has so quietly washed its hands of financial mysteries