QUOCUMQUE MODO REM

Various expedients have been proposed to thwart the depression, most of them involving some more or less temporary modification of the present economic system. Such are the various arrangements of barter, and Howard Scott's contribution, Technocracy. Certain Senators and other men in public life have recently added another proposition to the list: namely, an inflation of currency. The issuance of currency which is not redeemable in gold, in a nation which is not redeemable in gold, in a nation which is on the gold standard, is what is ordinarily meant by inflation. This is what the advocates of the plan have in mind, believing that such a step would put more money into circulation and raise prices. To date, the suggestion has had no result other than a flurry in the price of the dollar on foreign markets.

The main drawback to an inflation of the currency is the fact that it is a process difficult to control, and disastrous in its effects if it be carried too far. Examples of this are all too painfully presented by the events in the Confederacy toward the close of the Civil War, and by the complete collapse of the mark in Germany after the World War. Besides this danger, there is the fact that the present potential currency of the nation is not all in circulation. The banks have not issued all the money they are entitled to, simply because there has not been sufficient demand from financially secure sources. The government itself, then, must be the agent of distribution for this currency, and would be directly involved in any disorder resulting.

Finally, as pointed out by a recent article in the New Republic, the question arises as to whether the control of currency is a real factor in the prevention of such economic extremities as the present depression. The claims of Technocracy show that it is not; the exponents of socialistic reform have long belittled its importance; and even common-sense replies in the negative. By adopting so drastic a step as inflation, the nation not only places itself in a doubtful position, but it affirms that the basis of the present troubles lies no deeper than the workings of the monetary system. The more lasting complications which have brought about the present troubles are therefore, disregarded. In any case, inflation can only be a temporary solution of the problem; any change of real benefit must, of necessity, rest on less shaky ground.