The daily worker. [volume] (Chicago, Ill.) 1924-1958, 1931-08-26

France before any loan is possible, in practice
assists the block against Britain. Thus the Lon
don Conference could only end in fiasco. The
major questions of PREPARATIONS and debts could
not be raised; Snowden's attempts to do so were
fully baked. The problem of long-term loan
or any durable financial basis could not be
solved; all that could be done was to extend the
short credits, leaving all uncertainty for the
future.
But this was not all At the moment of this
critical financial situation for Britain came the
direct heavy offensive of Paris, and, to a lesser
extent, New York, on London. Wholesale
French withdrawals of credits brought down the
pound. Within the two weeks, July 1926 no
less than 40 million pounds of the total esti-
mated French balances of $50 million pounds
in London we're withdrawn. Sterling fell below
gold point. Within the same dates 81 million
pounds of gold Cor net 27 million pounds had
to be exported from the Bank of England's gold
reserve, which stood previously at 100 million
pounds, already very much lower figure than
Paris or New York. The Bank Rate had to be
raised on July % to 3la per cent-with inevi-
table unfavorable reactions on industry unem-
ployment and the international situation
The French government and the Banque de
France protested their innocence, that they had
no part in the process which was wholly remote
from political causes. In Britain a different
view was taken. Although the Banque de France
had no direct part, the observer" city editor
noted that the Withdrawals were carried out by
"a number of the smaller French financial
houses acting under one direction" (26. T. 81.
The "Times' city editor declared that some al
lege' that "the gold standard is being deliber-
ately abused for political purposes COS. 7. 81,
and further that it is necessary to put stop
to the abuse of the gold standard to which it is
being subjected today"
French institutions have long been accus-
toned to keep large balances in this market;
but if these balances are found to be unre-
liable, the facilities for their employment here
must in future be necessarily drastically re-
duced" (Times Trade Supplement" Is. 7. BIZ
The Daily Telegraph" diplomatic CORE
spondent openly recalled that:
"a similar process was noticeable both dur
ing the weeks which preceded the Hague Con-
ference and during certain phases of the Ma
val Conference held last year. ('Daily Tele-
graph" 225 T. 81
London responded to this situation Of com
bined crisis and direct offensive as to situation
of war, a fight for life or death of London as
a world financial centre. The former Conser-
vative minister, Captain Walter Elliott wrote:
Last Wednesday men came back from the
city to the House of Commons like soldiers
coming down out of the line" ("Sunday
Times" 10. 7. 81
The Manchester Guardian" London CORE
spondent described the atmosphere:
Behind the facade London is really at high
nervous tension There has not been a time
like this since the eve of the general strike
was remark made yesterday by very we'll
known business man who is usually described
rTll-.
its connotation with the first days of the
Great War, is filling peoples minds" CMan-
chester Guardian" II. 7. 3D.
The organ of the labor government the Daily
Herald" wrote:
Never since the fateful days of August,
1914, when war or peace hung in the balance,
was this country nearer to crash and calamity
than during the last seven days Behind
the scenes ministers, great civil servants,
bankers and hnanciers were fighting grim
battle against gerat odds to save not only
Britain but the world from overwhelming dis
aster.
When the full history is written, people
will be amazed to learn how near we were to
the edge of the precipice.
"a moratorium in this country was being
seriously discussed in some quarters when it
was feared that German crash would have
devastating effects on a number of great
financial houses.
"Others talked of National Government
as the only way out of the impasse" C'Daily
Herald" 20 T. 81
AS in time of war, the union Sacree" was
openly proclaimed. Macdonald, Baldwin and
Lloyd George kept in close daily touch through
out the crisis and the London Conference, thus
presenting, in the words of the DAILY Herald"
a united British front" to the world The
labor minister, Thomas, expressed with striking
exactness the conception of social fascism of
its role to save capitalism in crisis:
mot since August, 1914, has there been an
occasion when things were more serious than
they are at the present moment I con-
scentousy believe that it is a Divine Provi-
dence that has ordained that labor govern
ment and labor prime minister should face
this problem" C'Daily Herald" 81 T. 81
Nevertheless, despite all these efforts and even
despite Divine Providence" the London Con-
ference ended in fiasco for British policy The
heaviest exports of gold followed Immediately
after the London Conference.
Today temporary easing Of the position may
be achieved, following the Anglo French fnan-
cial negotiations, and further political conces-
sions of Britain to French policy But none OF
the factors behind the crisis are solved The
German situation still remains an open ques-
ton; and in the wake of the German collapse
British capitalism is inevitably drawn If the
experts work rapidly, if the inner situation does
not earlier break out, the credits may possibly
still be maintained may be transformed into
some form of loan but this only postpones for
a short time the greater crisis with the heavier