INDUSTRY AND FINANCE
[To the Editor of the SPECTATOR.] read with much interest Mr. Darling's letter in your issue of May 19th, with which I entirely agree. The late Lord
Milner, I know, viewed with the greatest apprehension the result of the monetary policy that was adopted in 1920. I append extract from a letter which I received from him on May 24th, 1920 :—
" Did I not say months ago, when there was all that rotten talk about ruin and bankruptcy, the burden of the debt, &c., &c., that ' the only thing which terrified me in looking ahead was the possi- bility of a restriction of credit '1 I always knew this mad nonsense would come. But I hope the protests of the business community will check it before it goes too far. Hitherto, perhaps, not much mischief has resulted, for somehow or other the mania for specu- lation had to be checked, though there certainly ought to be better ways of checking it than by measures which hit legitimate business at the same time.
My difficulty about all these questions is that I am not supposed to be an authority about them, nor do I claim to be an expert except in so far as common-sense and long experience may make one. But I am up against theories strongly entrenched in the Treasury, the Bank, and certainly the greater part of the whole banking world, and supported by tons of literature from the abstract school of political economists who have held this country in their baneful grip for nearly a century. It would take a man's whole time to get up a really effective ease against such a formidable combination, and as a matter of fact, my time is almost wholly occupied with work of a different kind."
All that has happened since has justified Lord Milner's apprehensions up to the hilt. Surely there is ample justifica- tion for an inquiry into the whole matter. Seven years ago the Federation of British Industries asked for-such an inquiry, and was turned down. Mr. McKenna has reiterated that request, and now the Mond Committee has strongly supported it. In view of the appalling state of our basic industries it is difficult to see why the Treasury should be against an inquiry. I hope it does not mean that at the back of their heads the Treasury have still in mind the policy of " bringing prices down." If this is so, God help industry !—I am, Sir, •&c.,
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