FRESH CRISIS

Hawera Star, Volume LIV, 7 June 1935, Page 7

FRESH CRISIS

SORE FINANCIAL STRAITS France Lacks Ready Money HEAVY PAYMENTS TO MEET Attempts to Form Cabinet PEAR OP PANIC (United Press Association —By Electric Telegraph Copyright). Received 12 noon to-day. PARIS, June 6. The Corsican ex-Minister of Marine and Finance, M. Pietri, baa attempted to form a Cabinet, but later stated that he was unable to do so. M. Plannery, governor of the Bank of France, interviewed M. Laval and said that only if the new Government was prepared to adopt a programme of drastic economies would the bank rediscount Treasury bills due on June 15. If the hank refused to rediscount such bills the Treasury would he empty and financial panic would ensue. It would then he clear to the public that the Government was responsible for the disaster.

When the Radicals learned of the ultimatum and gathered that M. Laval’s only chance of forming a Government was to accede to the tbank’s demands they refused their support. M. Laval’s reply was to tell the President, M. Lebrun, that he was unable to form a Cabinet. . In the meantime the parties of the Left, ranging from Radicals to Communists, also became 'aware of the issue between the bank and Parliament. Columns of motor cars filled by ex-soldiers of the Fiery Cross organisation, "which is Fascist, are en route to the capital, from Cambrai and other places with the intention of demonstrating to-day. The police fear clashes. Mobs paraded the boulevards shouting, “Down with Parliament!” “To the gallows with the deputies!” There were frequent clashes with the police before the crowds were dispersed. The process of sifting ex-members of the Cabinet for a possible new leader continues, while the situation becomes more critical. M. Jeanneney has excused himself for health reasons and M. Laval abandoned his 'attempt to form a Cabinet because fhe Radicals would not agree by a sufficient majority to support 'his proposal to limit the plenary powers to the defence of the franc.

M.. Lebrun consulted M. Edouard Herriot, who departed to sound the Radicals, declaring he was only on the threshold of the task. His failure in tbe quest proved the truth of the observation. The Socialists in the -meantime have issued a manifesto condemning the plenary powers sought and demanding the nationalisation of the key industries and possibly the Bank of France, dissolution of semi-military leagues and dissolution of the Chamber of Deputies with a view'to an election on the basis of proportional representation.

The Radicals, whose objective is a Radical Socialist Left cartel Government, buF whose Left Wing under M. Daladier revolted against M. Herriot, met and considered a manifesto. A cartel combination appears to be condemned before trial, the Left groups having found many Socialist points unacceptable. This led to an impasse which seems to clear the path for the Corsican, M. Pietri, ex-Minister of Marine and Finance, who is- the latest to accept an invitation to form a Cabinet. He also demands plenary powers, but is unlikely to complete his consultations before Friday. He will, if successful, be Prime Minister and Finance Minister. The police lafer to-day dispersed a Royalist demonstration and arrested eight persons. A gang of unknown men smashed the windows of the “Petit Journal,” which champions devaluation of the franc. • The gang also attacked the Masonic headquarters.

The Paris correspondent of the “Daily Mail” says the Treasury lacks ready money, yet the Government must secure £200,000,000 before January 1, 1036, for urgent expenditure. Moreover, heavy commitments for June 15 next must be faced during the next few days, and in this connection M. Laval consulted financial experts. ATTEMPT TO FORM CABINET Radical Leaders Decline Difficult Task Received 1.30 p.m. to-day. PARIS, June G. M. Laval has again undertaken to form a Cabinet only after the Radicals, M. Herriot and M. Delbos, declined. A former member of the original Cabinet, M. Rcnoult, has been acquitted on a charge of bribery in connection with the Stayisky affair.