Ashburton Guardian Magna est Veritas et Prævalebit. SATURDAY, NOVEMBER 28, 1925. THE FRENCH CRISIS.

Ashburton Guardian, Volume XLVI, Issue 10659, 28 November 1925, Page 4

Ashburton Guardian Magna est Veritas et Prævalebit. SATURDAY, NOVEMBER 28, 1925. THE FRENCH CRISIS.

Tlie resignation of the Painleve Cabinet after .a tenure of office of only a few months, is not a new experience for France, as since 1910 only four premiers have remained in power for more than two years, while the average life of a Ministry in the last 35 years has not been longer months. It is the circumstances in which M. Painleve’s resignation was brought about that invest the position with interest, though (financial problems have been the' bane of successive Ministries. The financial condition of the country was recently the subject of a report by the American Institute of Economics, in which it was stated: “Contrary to general impressions the French people are being* taxed and are paying taxes fully as heavily as the people of Great Britain and very much more .heavily than the people of this .country. . It is idle to expect any notable increase in governmental income from normal taxation sources. There is small prospect of expenditure being considerably reduced by methods usually advanced by foreign critics of French fiscal policy. The only line of saving /which is regarded as likely to improve the budget situation noticeably is in military outlay and even a 20 per cent, cut here would reduce the anticipated budget deficit for next year by only oneeighth. Contrary to official statements the budget bps been j nowhere near balanced this year, cannot be in 1926, and without drastic and confiscatory measures 1 will not be for several years to ; come. This is held true with favourable trade conditions, the continuation of which is by no means regarded as a certainty. Summarised, the report shows that in 1924 the French Government appropriated 20 per cent, of the national income, as against 18.5 per cent, yielded by British taxpayers) and 11.5 paid by Americans in combined municipal, state and federal taxes. It also pointed out that the French budget for 1925 will show a deficit of 18 billion francs. Before the war France had assets of 38 billion gold francs in foreign holdings. These were wiped out by the war and reconstruction period, to be replaced by a foreign debt of 25 billion gold francs of 1914 value. From 1914 to

1924 the public debt increased from 12 to 37 per cent, of the total national wealth. Now the foreign debt alone is equal approximately to 13 per cent, of that wealth. Shifts to meet immediate needs and placate wavering supporters have become the rule. The Government that sets out on an

unflinching* financial programme courts defeat, by multiplying* critics and throwing them into one hostile camp. That has been M. Painleve’s experience. The outcome is difficult to forecast, for each successive cablegram indicates further complications among the various parties. The latest review of the situation mentions four possible courses:— (1) A Government composed of the Left bloc, including the Socialists ; (2) A Socialistic Government, by participation by other groups of the Left bloc; (3) A coalition of the Left with the Centre Parties, but excluding the Socialists; (4) Dissolution and a fresh election. In the meantime foreign creditors are knocking at the door, and the franc is still falling, i