The Daily News. FRIDAY, SEPTEMBER 19, 1919. IMPOVERISHED EUROPE.

Taranaki Daily News, 19 September 1919, Page 4

The Daily News. FRIDAY, SEPTEMBER 19, 1919. IMPOVERISHED EUROPE.

Those who liave closely followed the course of events in Europe during and after the war are quite alive to the fact that industry has in large measure been paralysed except as to war work, It was expected that when the war was over, the many tangles thai had arisen would be unravelled and the inter-reactions of one industry on another would once more be placed on a workable basis, and the energy exhibited in the military struggle would be diverted into the channel of increased production. To some exten ; wo have been prepared for the Mattering of this hope by the im..istrial upheavals which have laken place, but it has fallen to the lot of Mr P. A. Vauderlip, a noted American banker and student of finance, to visit Europe and not only see for himself the conditions existing there, but to glean the opinions of the leading men- in the various countries—premiers, finance ministers, financiers, bankers, great employers of labor and labor leaders. The result of this mission has recently been published in the American Review of Reviews, and it forms one of the most interesting and convincing contributions on the economic conditions in Europe that have yet appeared. No one can read this remarkable survey without experiencing the same sensation as Mr Vanderlip, , who was shocked when he learned, within twenty-four hours of his landing, that most of his preconceived notions of what had happened to Europe had to be jettisoned. He visited England, France, Switzerland, Italy, Spain, Belgium and Holland, saw the conditions and something of the consequences that may flow from these and he believes it is possible there may be let loose in Europe forces that will be more terribly destructive than those of the war. The outstanding feature he designates as "paralysed industry." He found idleness and lack of production beyond comprehension throughout all countries where the hand of war had not been laid on industry, only the hurt, of this after war situation that has in it tli n promise of being a more terrible hurt than the war itself. He states, on the authority of Mr Hoover, that the breakdown in the transport system in Central Europe, in the countries east of Germany, is so serious that there is bound to be starvation of hundreds of thousands of people, and that the people will face, a year from now, a food situation worse than that in the spring of this year, because Russia has ceased to be an exporter and Roumania and Poland swept clean of working cattle. Besides lack of production and paralysis of transport, there is the primary trouble connected with money difficulties, and it is this evil which will probably be better understood by the people of the Dominions than the others which have been mentioned. In France, 'prior to the war* there were a little

less than 6,000,000,000 bank notes whicli formed the nation's currency. To-day, there are 36,000,000,000 francs of notes of the Bank ;of France. England has an enor- ! juous issue of whpt is practically | flat money—about three thousand ; millions, secured by about. £28,1000,000 of gold. Belgium was : forced by the Germans to make a great issue of notes, and wlum the Belgium Government, came back it had to take up those notes in part by its own note issue and in part, by bonds. On regaining Alsace- • Lorraine France had to redeem 4,000,000,000 marks, which cost •her a billion dollars in her bank note currency at 1.25 for the mark in a franc. Germany is in a parlous plight as regards her currency. The effect of her unrestricted issue of paper is seen to-day, when the mark is down to 2d aud the workers, though receiving nominally 26s 5d a day, find the purchasing value but 3s 6d. Very great consequences. :flow from the fact that England is off the gold basis. The day after war was declared she began printing paper money and added to the flat issue every ,veek during the war, and after, while the gold security remained stationary at about £28,500,000, and there are Government securities at the back of this currency issuemerely securing the Government's obligation with the Government's obligation, an example, by the way, that Sir Joseph Ward proposes to follow. Neither the Gov- | ernment nor the Bank of England 'has the gold to redeem any great j quantity of paper issue. It is estimated that when France has [discharged her obligations to her [own people she will have a total | obligation of three hundred billion [francs, or about twelve billion sterling. In every country in 'Europe, asserts Mr Vanderlip, there is a small minority to-day that actually questions the jus- | tice and right of the present capitalistic order, wielding an influjence out of all proportion to its numbers—active, intelligent and dangerous. The things it will best feed upon are dissatisfaction, want and hunger. To counteract this it is necessary to devise means for re-starting industry in Europe —giving employment, setting production going again and giving them something to exchange for the things they must have.' The remedy proposed by Mr Vanderlip is that America shall furnish those things whicli are essential to the re-starting of industry in Europe, not grudgingly, but according to the measure of necessity and apart from the consideration of security, because there is no security anywhere so long as part of Europe is idle, in want and hunger, ready for Bolshevism, ready for some uprising, something that will better their condition. Therefore raw material must be furnished, also food, machinery and equipment for railroads. "If," says Mr Vanderlip, "America looks to her opportunities for service to a stricken world, her opportunities will be such as were never before measured by any country."