Evening star., 1947-12-21
BY the Assoeiotsd Press

CurtallmenL OF money III ClTCulaIlOQ.
There was a somewhat less drastic
curtailment of bank accounts and
outstanding bonds. BY simulta-
neously decreeing broad reduction |
in prices and by maintaining the
same wages as before in her con-
trolled economy, Russia effected an
almost immediate drop in food and
many other prices.
Drastic wrenchings of postwar
economies also were reported from
other countries in the Soviet sphere.
Romania Raises Taxes.
Romania decreed heavy taxation
at the start of october to reduce
the amount of money in circulation
and bring it nearer the realistic level
of industrial and agricultural pro-
duction. Living costs, though still
high, plunged sharply.
Czechoslovakia, plagued by ex-
treme food and clothing shortages,
levied heavy new taxes to halt in
fationary buying and help pay the
mounting national debt-up nearly
$2,500,000 in year.
There have been no wage in
creases in Czechoslovakia since the
winter of 1945-46 and rationed
foods provide diet of less than
400 calories-lower than Germany
and Austria. Costs in the black !
market-the only other food source
are four to five times above the
official prices.
Italy's budget czar, Luigi Elnaudi,
was probably the only government I
financier in all Europe worrying
about deflation.
The PROFESSIONAL 74-year- old gov
ernor of the Bank of Italy has been
so successful in combating imitation
that many industrialists, investors |
and spectators have had their I
fingers burned.
Mr.. Einaudi's rigid credit restric-
tions to curb speculation and his
devaluation of the lira to the black
market rate have at least tenn
porarily brought swollen security
prices down, stabilized the currency
and lowered the cost of living.
Defiation in Austria.
Defation rather than imitation
also was the order of the day in
|! occupied Austria, where the govern
|Ements currency bill wiped out all
pre- 1915 bank accounts and de-
valued the schilling sc per cent. !
The effect was almost instantaneous
price reductions of about 30 per
fcent. But most costs still we're out
/ of reach OF, the average wage-earner.
Il In Britain even the cost of postage
went up last week because, the
government explained, operating
expenses have increased. Despite
government controls, coal. trans
portation and milk prices were edg-
ing higher. Purchase taxes. al
ready steep, have been increased
sharply to drain off some excess
purchasing power.
The British Board of Trades ad-
mittedly outdated cost-of-living in
dex, described by the government
as not even closely representing
the facts, Rported living costs
fairly steady at 80 per cent above
those of 1888.
Stabilizing factor, insofar as
prices for essential food and cloth |
ing are concerned, is the govern
ment subsidy, costing nearly AGO.
100000 pounds (s1,6oo,ooo,ooo) an
nually.
Unofdcially, the inflationary gap
in Britain-the difference between
supplies and demands variously
estimated from 10O,o0O,000 pounds
(s4OO 900, ,00O to 600,0O0,000 pounds
(s2, 400, ,000, ,0oO.
Defeated Germany was experience
ing the greatest success in holding
the line In legal markets (black
market prices are SO to 100 times
lhigher).,
Hitler Price Control Continued.
A United States military govern
ment survey showed prices in the
legal market increased less in Ger
many than anywhere in the world
since the end of the war, a result
of the little altered price control
ordered by Hitler in 1896.
France, which revalued the franc
after the war, was paying more and
more for all types of goods. Gov
ernment statistics showed whole
sale prices up SO per cent in the
last six months and As per cent
for the year.
Food prices jumped sharply In
Belgium when the government with
drew subsidies In early August. Wage
levels were three times above those
of 1888.
Greece's extremely sensitive econ