ruin and economic exhaustion of those countries that are compelled to yield to a spirit of economy, the advantage of which lies in the diminished exports while heavy debts drain their last resources. In countries with a poor currency and with the resulting premium on exchange, exports often increase while imports fall off. This is due to a disturbance of the economic balance, and is the result of past errors. It is ridiculous, therefore, to see such countries envied by those that have a good currency, without a premium on exchange, and that for this reason find themselves in a state of relative economic balance and welfare.

When Professor Wilhelm Lexis, who is always so exact and practical in his scientific hypotheses, affirms that the price of wheat at London can be diminished by a depreciation of the Indian rupee,1 he is utterly mistaken. He supposes that such a depreciation has encouraged the exportation of wheat, but he establishes a hypothesis contrary to common sense. During the first four months of 1896, 20,516,300 bushels of wheat were imported into England, while only 724,000 bushels of Indian wheat were imported, which is scarcely one-twentieth of the whole importation. What influence can such an importation have on determining the prices of wheat in England?2 No influence at all. We cannot, therefore, accept what Lexis says; the price of wheat in London could not fall on account of a depreciation of the Indian rupee when there is so small an importation of Indian wheat, and likewise we cannot believe that in the first four months of the year 1896 the price of wheat in London increased from 0.264 to 0.296, because of an increase of seven-hundredths of a shilling in the value of the rupee.

The

As is known, the increase in value of the rupee is one of the many economic effects of the Chinese-Japanese war. value of the rupee was:

1 W. Lexis, Agio on Gold and International Trade, Economic Journal, Decem

ber, 1895, v, 532.

2 The Economist, monthly trade supplement, May 9, 1896.

For the first four months of 1896, 1.22. This increase in the value of the rupee could not cause a decrease in the importation of Indian wheat to London. Such importation amounted during the first four months of 1895 to 1,791,300, during the first four months of 1896 to 724,800, 1,066,500 less in 1896-a decrease of more than one-half. It decreased in spite of the fact that the price of Indian wheat at London increased in a greater proportion than the price of other kinds of wheat increased. The price of other kinds, taken as a whole, increased from .264 to .296. The price of India wheat, which was at .250 in 1895, ought to have proportionally risen to .280 in 1896, but it rose to .288. Here we see an increase, which balances the rise in the value of the rupee. Thus the decreased importation of Indian wheat is more unjustifiable, if we attribute it to the rise in the value of the rupee. But, if this change in the value of the rupee exercised so great an influence over the exportation of wheat as to make it decrease more than one-half, what would its influence over the whole exportation be?

On the other hand, the total exportation from India for the past years has been as follows:1

1892-93 107,394,600

1893-94 105,092,500

1894-95 III,037,500

But the value of the rupee has varied more during these years than in 1896. If it has had any influence on the exportation of Indian wheat, it has been very limited. In fact, the exportation has varied very little. Therefore, the great decrease in the importation of Indian wheat to London in 1896 is due to other causes. It diminished more than one-half from 1880 to 1893-94. The exportation of Indian wheat decreases2 when

1 The Economist, 1895, p. 750.

The same thing happened in France. The Indian wheat which is imported into that country decreased as follows:

Now from 1891 to 1894 the price of silver continued to fall. It fell 60% in value, with a corresponding rise in the value of gold. This fact ought to have

there is a fall in the value of the rupee, but it continues to decrease even when the rupee tends to rise in value. The accidental relation between the two phenomena, therefore, does not hold true. There are other causes, which lead to the fluctuations of that branch of Indian commerce.

Edmond Théry, Poinsard1 and many other bimetallists however, have collected an enormous quantity of consular reports from China, Japan and India to demonstrate, on the authority of the consular agents, that the economic development of those countries, and the increasing competition which they bring to bear on European agriculture and industry, is the result of their silver currency. But either those reports are untrue, or else they contain dogmatic absurdities, or they are based on facts invented or badly interpreted. Francesco Ferrara was perfectly right when he declared, in his learned letters to Tullio Martello, that those diplomatic reports were not even worth the paper on which they are written.2 These reports, blindly mixed with the principles and corollaries of monetary and tariff protection, led to the most erroneous conclusions. Flooded as we are with monographs, pamphlets, reports, parliamentary speeches, etc., we must not be surprised if even the most sound and logical minds are led astray. Bare facts relating to money and elementary considerations now escape even the clearest intelligence. It could not be otherwise, when truth is buried under an enormous mass of groundless theories and data, which are badly gathered and worse interpreted.

The following leading self-contradiction is one among the many very curious and characteristic ones. Bimetallists admit that their system can become practicable under one condition: it must be international. If all the civilized countries do not take part in the great reform, if England and Germany refuse to encouraged wheat exportation from India, but the facts do not correspond with the illogical and strange theories of protection.-Comte Rochaid, La campagne bimetalliste, Paris, 1896.

1 L. Poinsard, La Question monétaire, Paris, 1895, p. 86-. E. Théry, La crise des changes, Paris, 1895, pag. 104. See also Board of Trade Journal, April 1894. Consular Reports, 1893, No. 1391, 1394. Bulletin Consulaire Français, 1891.

2 F. Ferrara, Esame storico-critico di economisti e dottrine economiche del secolo XVIII e prima meta del XIX, Torino, 1895, v. IV, p. 418.

join the rest of the nations, or are willing to come in only with their colonies, the experiment is bound to fail.1

But bimetallists do not realize the fact that if their system were adopted by all countries, no one of them would be especially benefited by it. If it is true that India, Japan and China are better off on account of their silver currency, it is due, according to the theories of protectionists, to the very fact that the countries of Europe have a gold currency. On account of this difference in currency the countries of the extreme East enjoy the upper hand over the countries of the West in the economic competition. But when western countries shall also have a silver currency, no advantage will accrue to them. The countries that now have a gold currency are the creditors of the countries with a silver currency or with an inconvertible paper currency. If they should abandon the gold to adopt the silver standard, they would suffer a heavy loss: all their gold credits would be transformed into silver: that is, they would be reduced one-half. This is a strong reason for England, Germany and France to maintain the gold standard; it is the argument of the creditor-countries, according to the saying of Mr. Balfour, who is the greatest representative of imperialism and economic empiricism.2

1 The following is the bimetallistic principle as expounded at the last bimetallistic Congress of Bruxelles, 1896. The bimetallist Congress adopted Mr. Beermart's motion demanding the establishment of a fixed ratio in the value of gold and silver by means of a general or partial monetary agreement among civilized nations, and advocating the gradual rehabilitation of silver. The Congress approved of the recent resolutions adopted by the British and Belgian parliaments on the monetary question. They expressed the hope that Great Britain would take the initiative in raising an international discussion on the subject. It further declared that a preliminary and immediate agreement might result from the re-establishment of bimetallism by the United States, the reopening of the Indian mints for the coinage of silver, the turning into silver of part of the reserve of the Bank of England, and the absorption of a sufficient amount of silver by the various European states."-The Daily Courier, April 25, 1896, p. 12.

In a recent debate on the monetary question in the House of Commons, Mr. Balfour said: "Then there is the creditor-country argument. There is no argument that has brought us into greater and juster discredit with foreign countries on the Continent of Europe, in America, and our own Colonies, than the creditor-country argument. He tells us that the debts of this country are paid with commodities; but the commodities are estimated on a gold basis, and

Therefore, should the countries with a gold currency decide to abandon it in order to adopt a silver currency, the immediate result would undoubtedly be as follows:

Ist. No benefit whatever would accrue to them in the international European commerce with the far eastern countries.

2d. Furthermore, their credits with those countries, more or less economically ruined, would be considerably reduced, and the interest which is paid annually with commodities, would accordingly diminish.

3d. The advantage of those countries with inconvertible paper money over the countries with a silver currency would remain. In order to overcome such an advantage, every country that suffers the competition of another with a depreciated currency, should immediately adopt the currency of the latter. Bamberger, with reason, laughs at the position in which Germany would be placed, should she decide to follow the advice of protectionists; Germany would not only adopt a depreciated currency, but she would also be constantly obliged to regulate its value according to the money of the country in question. In such a case Germany would not only be obliged to issue inconvertible paper money, but, in order to reach her object, it would be absolutely necessary for her to imitate, in every respect, the operations which the Russian Government would realize over her banknotes.1

All this is grotesque.

If the bimetallists would for a moment be less blind than they appear to be, it is doubtful whether they would feel very much flattered by the last result of their system. They would soon realize how limited their view is, and how impracticable their proposals are, and what poor economists they are. But the appreciation of gold which has gone on during the last twenty years has resulted in this-that the creditor-country paying in commodities gets a larger proportion of commodities than on the original gold value they would have the slightest right to claim."-The Westminster Review, August, 1896, Vol. 146, p. 153.

1 Bamberger, L., Le metal argent à la fin du XIXme siécle, Paris, 1895. Had Russia secured a good currency, as she now seems to have in view, (Sartori, l'abbolizione del corso forzoso in Russia, in the Rivista di Sociologia, III, 410, 1896), Germany would then be forced to devise means to counteract the Argentine wheat competition or that of any other country.