BOOKS.

MONEY AND PRICES.*

A Bill3UNDEILS'rkNDING of the relation of money to prices accounts in part for the political and. economic evils which afflict us. We may therefore draw attention to four useful books, recently published by Messrs. P. S. King, which elucidate in various ways a problem that has baffled statesmen of repute as well as the humble workman. Professor Laughlin, formerly of Chicago, in one book' discusses the question• mainly from the American standpoint, with special reference to the gold standard and the silver controversy, and in another books describes the credit operations of Great Britain, France, and Germany during the war ; Professor Cannans explains the general theory of money with admirable clearness ; while Professor Lehfeldts considers the gold supply and the influence of the war upon the Randmines. These economic experts are not wholly agreed in theory, for currency, like the tariff, seems to be an apple of discord even in academic circles. But on one point they are absolutely in accord—namely, the unsoundness of an inconvertible paper currency. There can be no doubt that we are all suffering from the excessive issue of Treasury notes, and it is worth while to see why the " Bradbury " was bound to send prices up. We must premise, of course, that prices must have risen considerably in any case during a war in which many millions, of men ceased to produce and were engaged in the work of destruction. The armies required so much food and clothing and other necessaries, besides munitions, that the surplus available for civilians was small, and therefore more costly than in peace time. Nevertheless, the issue of paper money in immense quantities by the Govern, ment from the very outset of the war has contributed to the rise of prices, for reasons which are obvious when they are stated.

As Professor Carman shows, the Bank of England note before the war retained its value because it was convertible on demand into sovereigns, and the sovereign containing 118 grains of fine gold was a standard fluctuating within narrow limits; because the demand for gold was large and fairly constant; because the Mint would always buy gold for coinage at a fixed price; and because, if gold appreciated, the sovereign could be melted down oar exported as bullion. The Treasury note stands on a different basis. Nominally, it is convertible on demand at theBank of (1) Money end Prises. By .1. Laurence Laughlin. London : P. S. King. [IOL 6d. net.]—(2) Credit of the Nation*. Same author•and publisher. [12s. 6d. net.l—(8) Moray CS Connexion with Rising and Palling Prices. By newts amain. Same publisher. i2s. 6d. net.)—(4) Gold Prices smiths Witwatersrand By It. A. Lehleldt. Same publisher. 15s. net.] England. Currency notes " have, as a matter of fact, been redeemed there for holders who have sometimes at least been required to write their names on the back of them and asked what they wanted the gold coin for." But as it is now illegal to melt down sovereigns or to export them, the currency note is really inconvertible, like the American " greenback " from the Civil War up to 1878. The value of the inconvertible note depends largely on the prudence of its issuers. The printing of a million or two pound-notes would probably have made little difference to the currency. But when the Treasury issued the notes first by tens and then by hundreds of millions, the effect was serious. The pound-note ceased to be worth a sovereign, and the margin between the two grew wider and wider. For, as prices rose, the Treasury argued that more currency was required., and printed more notes. " Turn this round," says Professor Carman, " express it in another way, and you have ' when the value of currency is low more of it is required,' and currency is thus made a striking exception to the general rule that the falling value of an article indicates that additional supply of it is becoming less required." Had the notes been convertible on demand into gold which could be melted down or exported, they would have retained their nominal value, and would not have contributed to raise prices. As it is, the pound-note is now worth several shillings less the n the gold sovereign. In other words, all prices reckoned in pounds sterling have appreciated to that extent, apart from all the other causes that have contributed to raise prices. If it were not true that the inconvertible note tends to fall in value, then any unscrupulous Government with a printing-press could live without taxes. But every one knows that an unlimited issue of inconvertible notes eventually becomes waste-paper, just as the fairy gold in the old tale turned to withered leaves. The French assignats of 1789, first issued as bonds secured on the confiscated Church lands to the value of 400 million francs, and afterwards recklessly increased to a hundred times that amount, depreciated as rapidly as they were printed, so that one gave a small fortune—in assignats—for a coach drive. The Bolsheviks have adopted the same policy, partly to delude their ignorant supporters, partly to upset the Continental money market, so that a thousand roubles in Bolshevik paper is possibly equal to a shilling. Clearly, then, an inconvertible currency must be limited if it is to retain any value ; the fewer the notes, the more likely are they to approximate to their nominal value in gold. Unfortunately, the Treasury has overstepped the bounds of prudence.

It is easy to see how the Government apparently profited by the issue of currency notes. They have, in fact, borrowed some £300,000,000 from the public without interest. They seemed to save £15,000,000 a year on the transaction. But they forgot that the consumers—that is to say, the nation -stood to lose many times £15 ,000,000 a year by paying the higher prices to which the inflated. currency directly contributed. Moreover, the Government had to pay more in Treasury notes for everything that was needed, and to contract heavier debts than would have been necessary under a wiser financial system. Professor Cannon's destructive analysis of the arguments put forward in defence of the Treasury is well worth reading. He is particularly scornful of the plea that the issue of currency notes was " automatic "—" in response to a genuine demand and not forced on people." " It might as well be claimed that the issue of pocket-money to a child is not under the control of its parents because it •is automatic, only taking place when the money is asked for." The same excuse might have been offered, with as little reason, if oldage pensions had been paid in currency notes not protected by a reserve of gold ; there would have been a genuine demand for such notes, but the issue would not have been automatic. The truth is that the Government were unduly influenced by the theory that a large gold reserve is necessary, especially during war, to maintain the financial stability of a modern State. After the experience of this war, the gold reserve theory clearly needs revision. Professor Canner]. and Professor Lehfeldt both emphasize the singular fact that the National Bank of Sweden found it. necessary during the war to refuse to accept any more gold, lost tho Swedish gold currency should be depreciated by the excessive supply of gold, thus sending prices up. America is known to have been inconvenieneed in a similar way by receiving more gold than she really wanted. It is conceivable, at least, that if after the outbreak of war our Government had adhered to their old and well-tried' policy, instead of giving way to panic and altering the currency, our financial system would have stood the strain with less difficulty than it actually experienced. Professor Laughlin in his account of our credit operations at the outset of the war maintains that even the suspension of the Bank Act on August 6th, 1914, enablingthe Bank of England to issue more notes, proved unnecessary, and that the banks made a great mistake in hoarding gold and encouraging the Treasury to put out currency notes. As Professor Cannon says, " if people dislike the rise of prices, which is another name for a fall in the value of money, they should insist on adequate limitation of the supply of money. This is a conclusion which has long been familiar to economists ; it is time it was grasped by the men who pride themselves on being practical."

SCOTTISH EXPERTS ON NATIONAL EDUCATION.* THE experts who have co-operated in this volume are better chosen than those who contributed to the Cambridge Essays on Education reviewed in these columns on February 16th, 1918. The Cambridge volume was largely dominated by Public School Head-Masters, too little space was devoted to the lower rungs of the ladder of learning, and many important subjects—co-education, for example—were passed over in silence. Here the whole ground is covered from elementary schools to the Universities.

The growth of the parish schools is traced to John Knox's great conception ; we have an admirable survey of the history of

Scottish education for the last fifty years, showing the convergences with and deviations from the English system ; and one of the best chapters in the book is devoted to a concise but lucid explanation of local administration. When we consider the splendid record of Scotland in education it is much to the credit of the writers that they should have abstained from invidious comparisons. The Scots trumpet is seldom blown : they are severely self-critical—witness Professor Burnet's frank admission of the parasitic character of high scholarship in Scotland—generously ready to acknowledge where they have been caught up and passed by England, keen to point out lapses from the old democratic ideals and to indicate where improvement is needed. Dissatisfaction is most strongly expressed with regard to the Universities, but it is admitted that even in the elementary and secondary schools the enrichment and broadening of the curriculum have brought loss as well as gain, and that the results are not always commensurate with the effort and the development of organization.

The parallel growth of education in England and Scotland since 1870 is traced in more than one chapter, and the problems are mainly the same, though the local and " regional " conditions vary. The importance of physical culture and hygiene ; the reduction of the size of classes a the need of improving the status and raising the salaries of teachers ; the conflicting claims. of science and the humanities ; the shortage of teachers— these are topics common to all recent books on education. So too is the effect of the war-4n the main disintegrating, tragically wasteful of the best brains, blood, and seed of the country, yet, by one of its rare compensations, convincing the man in the street that education is valuable, and inspiring " our soldiers at home and at the front with an insatiable craving for books, for classes, and for instruction generally." But the educational problem which above all preoccupies the writers is how to combine self-expression with social efficiency. Nothing is more significant of the altered outlook than the constant restatements of this problem and the endless repetition of such phrases ES "self-government," "self-determination," "self-discipline," "Self-reliance." Disregarding the authority of Murray, the editor drops the hyphen in every case, and the pages of the book are constantly disfigured with barbarous Teutonic compounds such as " agetried," "allsuffiaiency," showing how heavy the hand of the German still lies on the phraseology of the educationist.

On the question of reconciling the modern tendency to increased State control with greater individual freedom for pupil and teacher there is a considerable divergence of opinion. Dr. Alexander Morgan, who writes on "The Social Aspects of Education," is a firm believer in self-guidance, self-management, selfgovernment•, and freedom. "If the Great War has taught us anything, it is that only through individual freed( ra can we rear the higher types of civilization." The Gary schools in Indiana, the methods of the Junior Republic and Little Commonwealth and of Mme. Montessori, rouse him to enthusiasm. He anticipates the introduction of a certain measure of self-government into all schools. Most of the restrictions, rules, and regulations enforced in school are, in his opinion, " lingering relics of the old doctrine that the doing of distasteful and uninteresting tasks

is essential for both moral and mental salvation." Yet in America the wisest men and women are of opinion that you cannot eliminate all drudgery from education and convert it into an uninterruptedly pleasant game. Mr. Duncan MacGillivray in his preliminary Retrospect and Outlook sounds a

warning note. A convinced and whole-hearted supporter of Child Study and the new Humanism, of the increasing attention paid to the education of defectives, and of milder school disci pline ; fully sympathizing with the effort to reach a reasonable compromise between the conflicting claims of authority and liberty; he none the less declares that no compromise is possible with the extreme partisans of self-expression :

" They declare that all authority must be abolished, because authority is the negation of liberty. They would banish all forms of compulsion from education, and they demand for the child absolute freedom to develop on all the planes of his being without let or hindrance from any one. This form of pedagogic Bolshevism has not many supporters, but, such as they are, they are sincere, fanatic, single-minded, and therefore to be reckoned with. In addition they reflect a current phase of political thought, and a current practice in industrial combination. . . . Scottish teachers are not unimpressed by experiments in self-government, but they shrink from placing on pupils responsibilities beyond what seems suited to their years, burdens greater than they should be called upon to bear. They are therefore rather seeking to evolve a practice of school dircipline which, while upholding authority, will mitigate its exercise by various forms of devolution. This feature is specially characteristic of secondary schools, in which since the introduction of school games the character of the discipline has radically changed for the better. This is a debt, a great one, that we owe to the English public school system. That system has come in for much criticism and censure, but on the disciplinary sida at least it has many lessons to teach the world. Even primary schools have much to learn from it, especially in regard to the introduction of games and the cultivation of a corporate spirit."

Sir Leslie Mackenzie, the Medical Member of the Local Government Board for Scotland, who writes on "Physical Interests," defines the modern view of physical education as a reversion to the Hellenic ideal. Education, however, must take account " not of mind and body, but of the total personality realized as physical and mental." School hygiene has grown by leaps and bounds ; the logic of care for the body commits us to care from

birth and before it. The general results of the present system are most reassuring, but no finality of method has been reached, and the Swedish system is subjected to criticism as too rigid. Spon taneity is to be encouraged, but " some external norm is required," and Sir Leslie Mackenzie is strong on the need of a highly specialized training for the superintendents of .physical education. The article is a good summary of what is being done, but is written in a most repellent style, bristling with termino logical jargon.

Miss Fish,-who writes on " Girls in Elementary and Continuation Schools," and Miss Ainslie,who deals with The Secondary

Education of Girls," are substantially in accord in their views on co-education. The most serious objection is that an identical curriculum ignores divergent tastes and aptitudes, rates of development and physical powers. In the elementary schools, as Miss Fish points out, slum children have to unlearn as much as they learn. The causes of failure do not lie chiefly in defects of the educational system, but in parental neglect ; the teacher is too often ministering to a mind diseased or to an overstrained body. Yet the gains are great, and should be made greater with the raising of the school age and the broadening of supple mentary courses so as to avoid unnecessary competition with the higher-grade schools. Home-making is in her view the highest ideal. Miss Ainslie writes with sympathy, wisdom, and humour of the problems created or accentuated by the war. It has caused us to revise our judgment of women's capabilities, and has assisted them to secure their economic independence. It has also weakened the family tie, and often replaced the old filial subjection by what is at beat " an affectionate disrespect." Yet Miss Ainslie looks forward hopefully to a revival of womanli

ness and a true co-operation with men. She puts the general

aims of education—the love of goodness, beauty, and truth —first : the special aim " is most fitly expressed . in terms of social efficiency." We may also note her plea for a more generous recognition of women teachers, and their representation on the inspectorate. Dr. Strong, the Rector of the High School, Edinburgh, who deals with "Moral and Religious Elements in School," holds that the school, which as a preparation for life stands midway between the family and the world, stands second to the home in religious instruction. Physical and intellectual training are totally insufficient without moral or religious teaching. In regard to the former much depends on the personality of the teacher, and small classes are indispensable to moral progress. Dr. Strong, with Miss Fish and Miss Ainslie, holds that more use should be made of indirect than of direct moral instruction. Direct moral instruction in general is best given by religious instruction. With them, too, he holds that in Bible lessons the results of modern scholarship and criticism should not be overlooked.

We have already alluded to the strong modernist views of Dr. Alexander Morgan, who writes on "The Social Aspects of Education." With him social efficiency is the great aim. He subscribes to the doctrine that " every subject must be taught for both its social content and its social applicability." There is no radical divergence between Professor Burnet, who writes on The Classics in School and University," and Professor J. Arthur Thomson, who deals with " The Place and Function of Science." The two systems, as Professor Thomson maintains, are complementary. Both disciplines are desirable ; the relations should be one of partnership, not rivalry. Professor Thomson, of whom it may be said that his is an anima naturaliter Monona, quotes with approval Professor Burnet's saying that " the study of science for its own sake is emphatically humanistic " and Spencer's dictum that " Life is not for Science but Science for Life." While insisting that Science is much more international than philosophy, literature, or art, that it has a specific ethical value through the subordination of personal desires and precision of statement, and further (an excellent point) that it is of great value to the democratic movement by teaching it to face facts and test evidence, he is fully alive to the dangers of a squalid utilitarianism," and the risks of teaching applied science apart from pure science. We could wish that he had developed this point on the lines of the concluding passage in Sir Charles Parsons's Address to the British Association. Professor Thomson says in one passage that Science may help to guide goodwill : in another that Science gives guidance to goodwill. The former statement is more correct. The war has taught us that Science, harnessed to an unscrupulous State, can be an unsurpassed engine of malevolent destruction, and threatens the continuance of civilization, if not of the human race. Professor Burnet contends that our civilization is the direct heir of Hellas and Rome, and can only be restored after the havoc of war by fresh contact with its origins. He admits the spirituality of Science ; " nevertheless, for most men the approach to spiritual things will always be easier and more direct through letters and art " than through the austerer discipline of the exact sciences. Classical training is essential for the purposes of national life. But the restoration of humanism in Scotland is seriously hampered by the standards set in the State-aided schools and the inelasticity of the intermediate curriculum. He does not object to non-compulsion in regard to Greek, but to " compulsory Greeklessness," and the squeezing out of difficult subjects which ought to be begun early, thus throwing upon University Professors the task of teaching rudiments, and estranging a most important section of Scottish youth from the national Universities. The raising of the age of leaving school in Scotland has reacted on the teaching of the classics in the Scottish Universities, and also rendered it impossible for students to add a full course at Oxford to a course in a Scottish University. The migration to Oxford and Cambridge is now direct; it has a very depressing effect on classical study in Scotland, and threatens to produce a class distinction from which she used to be commendably free. The subject is further discussed in Professor Griersort's long article on " The Scottish Universities." He agrees in the main with Professor Burnet as to their loss of prestige and the damage done to humanistic studies by the competition of vocational interests, while differing as to the remedy. Dr. Laurie, Principal of the Heriot-Watt College, Edinburgh, in his essay on," Technical education " would remedy the abandonment of the old system of apprenticeship by devoting all the years of adolescence to the technical school. He supports school workshops, expects much of the newly established Department of Scientific and Industrial Research, and suggests how the co-operation of the University of Edinburgh and the three Institutions dealing with Technical Education may be extended. Mr. Malloch, discussing " Teaching as a Profession," hopes that Mr. Munro's Act of 1918 will help to secure recognition and improved remuneration. The article is a powerful plea against excessive State regulation and in favour of a united and organized profession, with a body like the General Medical Council to speak with a concentrated and undivided voice. " A body of experts whose power is conceded to it from without and does not emanate from within, is a profession only in name." Mr. Malloch's views on educational self-government approximate to the fashionable theory of Guild Control.