BRETTON WOODS

Otago Daily Times, Issue 26229, 13 August 1946, Page 2

BRETTON WOODS

Sir,—Miss H. Gow supports the Bretton Woods plan because, in her view, it is •necessary to stabilise competing currencies by tieing them to gold at a fixed price. As always, - she reasons within a Communist context, and then applies that reasoning to the present capitalist financial economy—which is absurd. Time and time again in these columns she has argued to the effect that capitalist finance leads to booms and slumps, which means progressive currency inflation if it means anything at all; for any price chart over an extended period resembles the outline of a switchback road, but always on an upward grade, To attempt to level out this graph and to keep it level in obedience to a gold yardstick is to attempt the impossible under the present financial structure, and can only result in progressive deflation of consumer buying power and another disastrous world slump. Therefore, any Communist advocacy of the Bretton Woods plan under capitalist conditions lays itself open to the charge that it is based either upon the want of knowing any better or upon the hope that the failure of the plan may help to bring the Socialist age nearer to the present day. _ _ Your correspondent C. M. Rose appears to have a genuine belief that the use of the golden anchor will put our economic system on an even keel and keep it there, but some of his arguments have a familiar ring and are similar to those used by the Cunliffe Commission, which advised a return to gold by Britain in 1925. Mr Winston Churchill, then Chancellor of the Exchequer, has since told us that he has never ceased to regret the part he took in that matter, and surely we in this country are being wilfully blind if we allow ourselves to be coaxed into the pact by specious arguments just because the Motherland has been forced to join under duress and against her will.—l am, etc., F- H -