The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1934-01-24

these powers permanently in the
executive without decent considera-
ton of what that means.
1t is wrong in principle to decide
such a question in the excitement of
a moment. 1t is politically bad to
do so because it means that at some
later date there will be precipitated
political struggle, based not on
the merits of managed currency,
but on the cry that the dollar has
fallen into partisan hands. Why
the Democrats should wish to make
themselves vulnerable to such an
attack, when they can defect it now
by a simple amendment, I can not
imagine.
The whole problem of where to
place the power to manage the cur
rency is not very we'll understood
by any one. 1t has not been dis
cuSsed in the United States for
twenty years, that is to say, not
since the federal reserve system was
created. 1t is inconceivable that it
has been adequately considered by
the Presidents technical advisers;
if it has been, their views on the
question are not publicly known.
Yet it is problem of the first
magnitude. For only by correct
decision as to whom to intrust
with the power to manage the dol
lar can there be any assurance that
the experiment of managing the
dollar will be successful. There is
little likelihood that the decision
can be made correctly by Saturday
night.
Ut is not only the administration
- which is unprepared to settle this
question permanently. The opposi-
ton has not had time to study it
either. For example, there is an
opinion widely held in some quar-
tiers that central banking and cur
rency management can be complete
ly divorced from the government.
Recently, for example, the Herald
Tribune stated that 1T is interesting
to note that England, with its
acknowledged fine tradition of CEN
trail banking, has a central bank
over which the government has no
control whatsoever" Even tech
nically this has not been true since
the currency and bank notes act of
1928. Actually it is not true at all,
as one can learn from Kisch and Ell
kins' book on Central Banks" to
which Mr.. Montague Norman con-
tributes a foreword. "There can be
little doubt that in practice there is
at all times close and continuous
cooperation between the bank and
the government when important is
sues are involved, and in exceptional
periods of the gold standard and at
other times had there been a
variance of opinion between the two
authorities, the government, with its
exceptional responsibilities, must in
the last resort have been empow-
cred to enforce its will"
A Ii this goes to show that the
L n task of setting up the supreme
monetary authority is an immense
ly complicated problem. 1t ought
to be examined, studied, and de-
bated for a considerable time be-
fore final decision is reached. The
gold bill as it now stands does not
provide for any period of waiting
before a final decision. Yet the
measure will, nevertheless, be ex-
amined, studied and debated since
it raises issues of transcendent i'm
portance. But once the measure is
passed in its present form, any at
tempt to change the location of
these powers will almost surely
turn into partisan battle to de-
prive the resident of powers. If, on
the other hand, his powers lapse
by law, the question of where to
place them permanently will be far
less embittered and dangerous. It
will not then be a question of TAX
ing away his powers, and appear
ing to give him vote of no conf
dence, but of settling question
acknowledged to be open.
The unamended bill invites con-
fusion. All that can be accom-
plished by rushing it through un-
amended is to make it difficult for
constructive criticism to do its work
in perfecting the policy and to make
it very easy for destructive criti-
cism to attack the foundations of
the policy.