Le Figaro
- The Two Currents
- COALFIELD SUITE
- FIXED IDEAS
Le Figaro of 3 November 1926 set economics beside literature on its front page. Lucien Romier argued that France's present calm rested on a temporary balance between two opposing currents: old savings flowing back into Treasury bonds, prized for their tax exemption, and rising prices pulling more banknotes into circulation. He warned that whichever prevailed would bring either a commercial crisis in the spring or a relapse into inflation. André Maurois sketched a strikebound Northumberland coalfield, its chimneys cold and its football pitches crowded, with an engineer blaming the fall of continental currencies for making British coal too dear to mine. Hugues Delorme contributed a satirical poem imagining a secret poisoner slumbering in the heart of the pharmacist Monsieur Homais.
Translation
The Two Currents
So it is that there exist at present, within the national economy, two entirely opposite currents. The first current coincides with the return of old savings to Treasury Bonds, regarded as an advantageous investment because of their exemption from tax. The second current, running the other way, draws an ever-growing number of banknotes into circulation as a result of rising prices. These two currents, which are at present in balance, give us tranquillity by neutralizing each other. But, quite evidently, this balance is temporary. One or the other will prevail. If it is the current of savings, we shall suffer a commercial crisis in the spring. If it is the current of activity and rising prices, we shall fall back into inflation [?]
Lucien Romier.
COALFIELD SUITE
Northumberland. A setting like Béthune or Lens, corrected by Constable. On the horizon, the Signs of Coal: black triangles topped by a wheel, chimneys, artificial hills with slopes too steep and flat summits; but in the foreground a charming river, which great oxen cross at a ford, flows between yellowing trees. The chimneys are not smoking; the miners are on strike. Great calm. No police; no processions. Only the football pitches, innumerable, are covered with players, surrounded by spectators.
THE ENGINEER. The causes, sir? They are complex. The fall of the continental currencies has created an enormous gap between our wages and those of other countries. Our coal costs too much to extract.
André Maurois.
FIXED IDEAS
Just as, beneath a crimson dawn,
The storm lies in wait over the summits,
A sly Borgia slumbers
In the heart of Monsieur Homais.
Beside the jar with its mauve glimmers,
When he kneads his marshmallow pastes
Or fiddles about with a liniment,
The dark obsession haunts him
To carry out some wicked deed;
And it troubles him infinitely...
The paranoiac unconscious
(This term is an echo of the experts)
Which the love of poisons unhinges
And the use of the codex leads astray,
As soon as it gives itself to mixtures
Would like to add belladonna,
Strychnine, datura,
To the most harmless remedy...
Shame on the dangerous Archimedes
Who, traitor to his charge, will kill
Hugues Delorme.
Context
Why savers were returning to Treasury bills in autumn 1926
Romier was writing just over three months after Raymond Poincaré took office in July 1926 with a clear intention to stabilize public debt. President Gaston Doumergue had asked Poincaré to form a cabinet of national union, and in Herodote's account the confidence of business circles and savers returned at once. The Treasury bills Romier mentions belonged to the short-term debt France had piled up during the war: the Bons de la Défense Nationale, freely available for subscription by banks and the general public alike, amounted to roughly 45 billion francs in July 1926. In August 1926 the Poincaré government targeted these bills by creating a sinking fund, the Caisse Autonome d'Amortissement, whose function was to collect revenues from certain taxes and devote them to repaying state debt. According to Herodote, savers were thereby assured of recovering their stake, a guarantee that bears directly on the flow of old savings back into the bills that Romier describes.
What became of the bills and the Bank of France advances
The state's other wartime instrument was the Avances of the Banque de France, a credit line opened by the Bank for the Treasury, with a maximum amount voted by Parliament. Aurélien Espic's study states that these advances were partly repaid in 1927 and by the monetary law of 24 June 1928. For the bills, the same study gives a circulation that fell from 49 billion francs in December 1926 to 33 billion in June 1928. Compared with the figure of about 45 billion for July 1926, the December total is higher, which fits Romier's observation that old savings were flowing back into the bills that autumn; the decline came only later. The withdrawal of the bills also had a consequence outside both of Romier's scenarios: it disorganized the largest Parisian banks, which had relied on these bills to manage their liquidity.
Did the inflation Romier feared return?
The months after Romier's article went differently from his inflation scenario. Herodote reports that tax receipts rose while consumer prices tended to fall, partly because of the revaluation of the franc. The stabilization was later fixed in law: on 25 June 1928 the French government devalued the franc by four-fifths of its value, ending the long uncertainty about its parity. Herodote is a general survey rather than a price series, so it cannot show whether a commercial slowdown arrived in spring 1927 as Romier's first scenario warned; it does indicate that his second scenario, a relapse into inflation, was not the course France followed.
How striking miners' families were kept alive
A memoir by a man who went to live in the small mining town of Birtley, County Durham, records how families survived the lockout that Maurois glimpses from outside. A national miners' relief fund existed and was large, but in the memoirist's words not nearly as large as the distress it had to relieve. The local Boards of Guardians were under the control of the Minister of Health, who ordered relief to all able-bodied men, single or married, to cease. When the Chester-le-Street Guardians refused, the Conservative government deposed the elected Guardians and installed three highly paid commissioners. From then on the only relief was 8 shillings a week for a wife and 1 shilling a week for each child. The memoir concerns County Durham rather than Northumberland, but it describes the same lockout and the same relief system.
How calm the coalfield was, and how the dispute ended
Maurois saw no police and no processions, yet the Durham memoir describes a harsher autumn in the neighbouring coalfield. After the Nottinghamshire miners, led by the Labour MP G. A. Spencer, broke away from the Federation and returned to work, heavy police reinforcements appeared in Durham, the biggest and heaviest constables brought from distant counties. In December a national ballot of the miners favoured a return to work, although Durham voted by a big majority to stay out. Maurois's 'great calm' is thus a picture of one place at one moment, and the engineer's explanation, which blames the fall of continental currencies, is a speaker's view reported in the column rather than an established account of the dispute's causes.
Original
Les deux courants
De sorte qu'il existe, à l'heure actuelle, dans l'économie nationale, deux courants tout à fait contraires. Le premier courant coïncide avec le retour de la vieille épargne vers les Bons du Trésor, considérés comme un placement avantageux à cause de leur immunité fiscale. Le deuxième courant, en sens inverse, entraîne dans la circulation un nombre croissant de billets du fait de la hausse des prix. Ces deux courants, qui sont à l'heure actuelle équilibrés, nous donnent la tranquillité, en se neutralisant. Mais, de toute évidence, cet équilibre est passager. L'un ou l'autre l'emportera. Si c'est le courant d'épargne, nous subirons une crise commerciale au printemps. Si c'est le courant d'activité et de hausse des prix, nous retomberons dans l'inflation [?]
SUITE CHARBONNIÈRE
Northumberland. Décor de Béthune ou de Lens, corrigé par Constable. A l'horizon, les Signes du Charbon, triangles noirs que surmonte une roue, cheminées, collines artificielles aux pentes trop raides, au sommet plat; mais au premier plan une rivière charmante, que des grands bœufs traversent à gué, coule entre des arbres jaunissants. Les cheminées ne fument pas; les mineurs sont en grève. Grand calme. Pas de police; pas de cortèges. Seuls les terrains de football, innombrables, sont couverts de joueurs, entourés de spectateurs. L'INGÉNIEUR. Les causes, monsieur? Elles sont complexes. La chute des monnaies continentales a créé un décalage énorme entre nos salaires et ceux des autres pays. Notre charbon coûte trop cher à extraire.
IDEES FIXES
Tel sous une aurore vermeille L'orage guette les sommets, Un sournois Borgia sommeille Dans le cœur de Monsieur Homais. Près du bocal aux clartés mauves Lorsqu'il malaxe ses guimauves Ou tripatouille un liniment, La sombre obsession le hante D'accomplir une œuvre méchante; Et ça le trouble infiniment... L'inconscient paranoïaque (Ce terme est un écho d'expert) Que l'amour des poisons détraque Et que l'emploi du codex perd, Dès qu'aux mélanges il s'adonne Voudrait joindre la belladone, La strychnine, le datura, Au plus inoffensif remède... Honte au dangereux Archimède Qui, traître à son mandat, tuera