The daily worker. [volume] (Chicago, Ill.) 1924-1958, 1927-09-17
By II. NJ. WICKS.

"A lor of the eXchequer in the labor
government, Mr.. Philip Snowden, must
labor under the illusion that his term
as chief of the treasury department
of the British government fitted him
to comment with authority upon any
subject pertaining to finance capital
and the worlds gold supply. In
recent article in the London "Finan-
cial Times" the former British secre-
tary of the treasury charges that the
United States is boarding far more
gold than "is required for monetary
use or legitimate credit" He suggests
that if this policy is continued eur
ope may defend itself by further eco
nomy in the monetary use of gold,
which would enable central banks to
dispose of a large part Of the gold re-
serve"
In the entire article of Snowden
there is scarcely one statement that
accords with the facts. His argument
is pure fiction, Pigment of his re-
formist imagination, vulgarization
of economics that has no parallel in
the last quarter Of a century.
Instead of boarding gold the chief
problem of the Federal Reserve sys-
tenn is to devise some means whereby
the flood of gold pouring upon these
shores may be diverted to other
channels. Already the enormous sur
plus of gold in this country has re-
suited in drastic steps being taken to
overcome its paralyzing effect. One
of these measures has been what is
called in banking parlance the "sterili-
cation" of the enormous sum of ST.
400,000,000 in gold imports. This
amount has been set aside and pre-
vented from performing its normal
economic function in order to main
tain money rates at a high level.
Even this measure works in the OPP
posite direction from that desired by
the bankers. The high rates thus ar
officially maintained have caused adj
ditional gold to flow to this country.
Furthermore it has simulated the
mining of gold and has even caused
gold buried in the arts to be melted
and thrown upon the market. So in
volved in contradictions is the CAPT
talist system that some of the most
elaborate plans turn into their OPP
posite and make even worse a con-
dition they strive to remedy.
HAVING seen the futility Of the
IL sterilization" of gold in the
vaults of the reserve banks of the
United States, the manipulators of
the gold market are now striving to
prevent gold intended for this country
leaving Europe and other parts of
the world, by process of "earmark-
ing" Efforts are now being made
| by American bankers to secure con-
certed action on the part of European
central banks to prevent gold flowing
into the United States. On a number
has the same effect upon the gold
purchased by American banks has
been held in reserve abroad and eff
forts were made to resell it without
its entering this country at all But
even that is futile for the simple
reason that the holding of it abroad
has the same effect upo the gold
supply of the United States that it's
| importation into this country would
have. When it is resold it takes the
place of gold that is lying fallow here
and that would otherwise have taken
its place.
All these manouvers on the part OF
American imperialism to divert the
flow of gold from this country es-
cape the astute eye of the former
chancellor of the exchequer of Mac
| Donald's government. Instead of
boarding gold the life and death prob
lem for the maintenance of the gold
standard is involved in devising a
means of disposing of the tremendous
surplus already on hand.
At the identical moment Mr.. Snow
"A den was writing his profound OBJ
servations revealing how little he
really knows of the workings of the
| system under which he lives and how
utterly incompetent he was to hold
his job as secretary of the British
treasury Wall Street was placing at
the disposal of the Commonwealth of
Australia, under the flag of Britain,
the sum of $40,000,000, and striving
/ to induce municipalities of that coun-
try to take another $30,0O0,O00 In
the past year 1925 the total of
foreign securities bought by this
country was $1,318, 554,850. A con-
siderable proportion of these were
purchased with gold In addition to
the selling of securities, enormous
! private loans have been made to
foreign bankers. The position of the
United States as the most powerful
/ imperialist power on earth, and it's
J tnncitiat, H. hn ,,lrn.. Il LIZ