[To the Editor of the SPECTATOR.] Sm,—To those who have
always taken strong exception to the Report of the Cunliffe Committee, it is a great satis- faction to find the Spectator dealing on broad and clear lines with the whole question of currency policy, and I trust that your influence may now be directed to obtaining a definite statement from the Government of what their present policy is.
Mr. Baldwin's statement on the subject appears to justify Punch's cartoon. He says : "We are not, in present cir- cumstances, any more than we have been for many months, pursuing a policy of active_ deflation, and we certainly do not
propose to proceed in the direction of inflation." Are we to understand from this that the policy of the Cunliffe Com- mittee, which was a policy, of deflation, has been given up for the time?- Or does the introduction of the word" active"
imply that deflation is now so securely embarked on its course that it can safely be left to operate without further
official intervention ? Does the Government intend to give the country a stable level of prices or-not, and if so, where is that level to be ? Is it still intended to raise the value
of the £ until we can restore the gold basis ? If so, there must be a further fall of prices, with a continuance or an increase of the distress that has accompanied falling prices since the spring of 1920. If it is not intended to raise the value so far, where is it intended to fix it ; that is to say, where _is the level of prices to be stabilized ? With our present artificial _currency the whole matter is in the hands of the Government. It is of the utmost importance to the community, and, especially to the business community and to the wotker, to know what the future value of the £ is to be. They have suffered much from its variations since 1914, and the confidence essential for the encouragement of production cannot be restored until they are not merely assured •of future stability, but have some definite know- ledge of the level of prices at which stabilization is to be effected. Mr. Baldwin's facing-both-ways statement gives no information.
Mr. Baldwin finds little sign to-day of "such a growth of world trade as occurred, for instance, at the time of the great gold discovery," meaning, I suppose, in the 'fifties, If he would turn to .the price indices of these days he would find that this great growth of trade was associated with a rise of prices following the depression and distress of the years that succeeded the Napoleonic Wars. There is not only no sign of a similar expansion of trade to-day, but no possibility of it while prices continue to fall, and sooner or later there will be a reaction against those who contrived artificial means for bringing prices down in recent years.—I am, Sir, &c.,
Previous page
