Evening star., 1934-06-17
dented and extraordinary measures.

exports, a statute authorizing imitation,
and default on the obligation to pay
gold on its bonds. The majority Of the
economists regarded these various
measures as unsound and in some re-
spects unethical, but they excused
them as the hasty emergency acts of
a government driven frantic by emer-
gency. When the default on the gold
payments was finally confirmed by law
last June, the overwhelming majority
| of American economists was forced to
| the conclusion that the Government
had surrendered to unsound monetary
theories. They have consistently op-
posed every monetary measure adopted
since that time On October %, 1888.
"A economists especially interested in
monetary problems sent to the Presi-
dent brief letter declaring their op-
position to imitation and urging a re-
turn to the gold standard. The signers
included a half dozen men whose rep
| utations are international.
Subsequently there was organized
a group of about 100 economists who
have made a professional study of
monetary problems. They are prima-
rily from the academic world, but
there are also a few of the distin-
guished leaders of American financial
journalism. Included are such men as
Knley of Illinois, Kemmerer of
Princeton, Mitchell and Willis of Co.
lumbia, Ebersole of Harvard. Wester-
field of Yale, Leonard Ayres and Alex
ander D. NoyeS. Prof Sprague joined
the organization when he left the
service of the Government.
In November and December last
year this committee issued public
statements condemning the gold-pur-
chase plan and recommending a re-
turn to the gold standard. In recent
weeks it has issued other public state
ments disappearing every silver pro-
posal under consideration and reject
ing the proposal for commodity
dollar" In January it sponsored a
QUESTIONABLE to be submitted to all
the professional economists of the
+, country, regardless Of their political,
sectional, governmental or academic
Affiliations. The replies proved that
a very large majority of American
economists are unalterably opposed to
the whole monetary program of the
administration, including abandon
ment of the gold standard, imitation,
the gold-purchase plan, devaluation
and the commodity dollar. More than
IS per cent of the economists voting
disapproved Of any form of silver
legislation.
The monetary program Of the Gov
i hos hod Nhinn-
tive: to force a rise of prices by
results expected were the cure Of de-
preston and the "equalizing" Of the
burden on debtors. Economic science
and economic history show that you
cannot cure depression in this way
If it could be cured in this fashion
we could live in an age of perpetual
economic jazz. merely juggling the
currency about and restoring pros
perity whenever a boom collapses.
Obviously there is something wrong
somewhere in the picture. The trou-
BILE lies in credit Money is only a
base in our financial operations, and
credit substitutes for money do most
of the work. Economic science shows
also that If the price level could be
moved about at win no one arbitrary
level would wipe out the burdens of
the debtors. There is no force in life
that can do this, and natural recovery
comes more nearly to 1t than any
other.
And yet in pursuit of this will-of-
the-wisp of monetary theory we have
defaulted on our obligations, debased
the American dollar, authorized secret
manipulation Of credit and generally
terroriZed the financial world. As
the economist has realized all along
the actual material harm from these
measures is less than many Of the
critics have charged. The greater
danger lies in what may be done
Economics justifies the relief meas
ureS as necessary, and even applauds
most of them as new and courageous
attempts to aid in depression. II
sees in the reform measures much
good, with some minor errors in de-
tail, even though they might well
have been delayed in their establish
ment. But in the forced-recovery
measures economics sees hoary eco
nomic error in full operation. In
instituting these measures, the Gov
ernment is like Columbus, who
didn't know where he was going
when he set sail, didn't know where
he was when he got across, and
didn't know where he had been when
he got back.
There lately has been a kindly and
patronizing disposition on the part Of
many persons wholly unversed In the
the harmleSsneSS of the impractical
but we'll intentioned economist. 1t ex-
presses itself in the general philos-
ophy, Don't shoot the professor -
This writer has had long and inti-
mate experience with all sorts of
men. and he has concluded that the
most practical, hard-headed and
clear -visioned group Of men he
knows are in the economics profess
sion.
In this country the most extraor-
dinary measures have been taken in
pursuance of visionary, undemon-
strable and unavoidable theories of
economics.
oue IAAOoS tilCoilco arc IOG Idhcll
from academic economist sources.
They are the theories of very prac-
tical men-agricultural experts, Unit
ed States Senators and 10 per cent
margin silverites. Shoot the professor
if you care to, but do not accuse him
of responsibility for visionary theo-
ries. He would rather be shot at.
i LAXITY IN RETURNING
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