Bleak prophecy

[wolfinthewood]

I don't often comment on politics in this journal, and when I do, it is generally obliquely, by way of some quoted passage that strikes me as apposite to the times. This is not because I am not interested; on the contrary, people who know me in Real Life know that life with Gill is lived to the accompaniment of regular savage commentary on public affairs. But this journal is a space to play in, and share fun stuff.

However, yesterday's news about the Bank of England's decision to resort to ‘Quantative Easing’ ‘Quantative Inflation’ strikes me with the deepest dismay and foreboding. It has been clear to me all along that the nightmare to end all nightmares would be hyperinflation; also that we would be quite lucky to avoid it. I did not imagine that Britain's economic governors would run to embrace it with open arms.

Did they never learn any history at school? Do the words 'Weimar' and 'wheelbarrow' fail to ring any bells for them?

My partner's mother lived in Germany for a while in the early 1920s. I am told that for the rest of her life she flatly refused to save money.

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There had come a complete uncertainty as to the future. Long before the close of 1791 no one knew whether a piece of paper money representing a hundred livres would, a month later, have a purchasing power of ninety or eighty or sixty livres. The result was that capitalists feared to embark their means in business. Enterprise received a mortal blow. Demand for labor was still further diminished; and here came a new cause of calamity: for this uncertainty withered all far-reaching undertakings. The business of France dwindled into a mere living from hand to mouth. This state of things, too, while it bore heavily upon the moneyed classes, was still more ruinous to those in moderate and, most of all, to those in straitened circumstances. With the masses of the people, the purchase of every article of supply became a speculation—a speculation in which the professional speculator had an immense advantage over the ordinary buyer. …

Nor was there any compensating advantage to the mercantile classes. The merchant was forced to add to his ordinary profit a sum sufficient to cover probable or possible fluctuations in value, and while prices of products thus went higher, the wages of labor, owing to the number of workmen who were thrown out of employment, went lower.

Andrew Dickson White (1832–1918)

from Fiat Money Inflation in France (1914)

[full text on Project Gutenberg]


I am off to dig the garden and plant cabbages.


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