[To the Editor of the SPECTATOR.]
Sia,—Your correspondent, Mr. Wm. Brown, in the issue of April 5th himself makes the" clear statement of the problem for which he asks. To obtain "clear ideas for its solution" it is necessary to understand that food producers (including the receivers of agricultural rent) are the only true purchasers, all other classes being merely sellers to them of products other than food, or exchangers between themselves of those products.
If there are more sellers than buyers, the initial problem is how to redress the balance, the obvious reply being by reducing the number of the former, and increasing the number of the latter. To do this requires at first sight that some of the "other classes" should become food-producers, but when the over-production of foodstuffs is remembered, it will be seen that this remedy would not solve the problem, and that therefore there must be something wrong somewhere in the present economic system.
I suggest that the wrong is that we give people abroad, who send foodstuffs or goods to us here, the privilege of demanding a gold bar from the Bank of England in exchange for 21,550 of its notes, by doing which we effectively " peg " the foreign exchanges, preventing them from getting adverse to those abroad who wish to sell goods here, and enabling the latter when they have done so to take our gold instead of our goods, if they find they can buy similar goods abroad cheaper for gold than they can here. Until this wrong is righted the unemployment problem must get steadily worse.----
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