Managed Currency—Yes, Indeed!
Our goldfish expert looks into this currency business
I'VE been right up and at it, and I've been investigating. I claim to be a good newspaper reporter. I am not a journalist. I am a reporter, and I have been right up and at it. An editor said to me: “Eddie, go out and find out all about managed currency, and write a piece about it. Managed currency,” he said, "is important.” “It may come any time. You can never tell what may come in this country, so stop Itxiking like that and get to the dickens out of here. G’mornin’.” That is what the editor said, and he meant it.
1 know he meant it. I just asked him why he was picking on me and he wanted to know what he was paying me for. So I have been right up and at it. When an editor asks questions like that, you want to lx right up and at it. You want to say: "Yes, boss.” Then put on your hat and walk briskly down the street to the armchair restaurant where the gang holds out. A cup of coffee will cheer you and a pleasant hour spent with the gang will give you sufficient courage to go back to the office and report as follows:
"Boss, on this managed currency racket. The only man in town who knows the theory and how it works is Professor Busko of the Economics Foundation at the University and he has just left for Europe on his sabbatical year.”
This strategy has hefixd more than one reporter out of a bad S|X)t. It didn’t work for me. The boss just wanted to know who had asked me whether this professor had gone to Europe. He was quite expressive about it, and he said: “For Pete’s sake, go see a bank manager.”
1 explained to this editor that bank managers were always cruel to me, thinking more of their money than the finer feelings of newspaper reporters. “I never,” I said, “had any success with bank managers.”
The editor said : “Go hire a hall.” I íe did not mean me to go hire a hall. I íe meant something quite different. So l shut up.
The Rebuff Abrupt
T SIGHED. 1 sighed a deep, heartfelt sigh, and I went *■ looking for a bank manager who knew about managed currency. The first bank manager was not a sociable bank manager. He was a snooty, upstage, bank manager and he wore that “You’ll have to put up more collateral” look, as if that was the kind of a hx>k he enjoyed the most. I mean he was being a bona-fide bank manager of the more orthodox or collateral variety. I did not discuss managed currency with this bank manager. No! My conversation was with his secretary. She is an efficient secretary, and some day she will undoubtedly marry a nice, carefree lad and save his money for him. This will annoy the nice carefree lad, but she will do it because she will believe it to lx her duty. You have probably met secretaries who will one day bring their future husbands down to brass tacks.
I went in, and she said: “Have you an appointment?”
A remark like that is always my cue to be cheerful. I said: “Goodness, I never make an appointment.”
In magazine stories a reporter making a similar remark is immediately ushered to the president’s sanctum where he proceeds to tell the old boy the grim truth. Even reporters know that is the only kind of truth to tell a bank president. My bank manager’s secretary will never make a good usher. No, indeed. She didn’t usher me. She said, “Oh.” Then she said, "Indeed.”
“I want,” I said, “to discuss managed currency with him.”
People want so many things around a bank. People go in and sit around and are so happy just wanting. I am still wanting to discuss managed currency with that bank manager. His secretary turned around and leaned over a polished mahogany rail and said: “He wants to discuss
She said this in a voice, if you follow me. She said: “He wants to discuss managed currency,” and her voice made me think of dim, tropic forest isles, and lions and tigers and a fish hook that once got caught in the seat of my pants. Secretaries often make newspaper reporters, insurance agents and the boss’s wife think of these things. You may have noticed it. The bank manager looked at me. He looked at me until I thought I ought to offer him a five spot on account. That seemed a reasonable amount to me, and I was just reaching for the remains of the pay envelope when he did himself out of the five spot. He spoke. He actually spoke. I íe said : “Go away. ”
And the Rebuff Courteous
T WENT away. That is what you do when a bank manager * says: “Go away.” Some people go away and do thoughtless things with garage doors. I just went away. I went away to another bank. It was a friendly bank. The boys and girls were right on their toes and right after business. They beamed. They made me feel right at home. That was the way I felt. I said “Hello!” to the bank manager. That is what I said, just good old-fashioned home folks talk like that. I said "Hello!” and explained my mission. The bank manager put one arm around my shoulders. He treated me just like a father.
“Managed currency,” he murmured. "Managed currency. My young friend,” he said, “it is all the bunk.”
I found myself walking through the door of the friendly bank. I am suspicious of the friendly bank. That friendly slap between the shoulders might have been a shove in the right direction. I am suspicious that the manager did not want to talk about managed currency. I was out on the street when this suspicion came to me, but I still have it.
So I conducted a survey, and I can tell the editor that bank managers do not want to c’:scuss managed currency. The idea is repugnant to them, “hev regard managed currency with the loving kindness usually reserved for delinquent debtors. You know how a bank manager loves a delinquent debtor, always pursuing him around, demanding his company, or a little something on the old note, or something friendly like that. Managed currency is a new idea, and
bank managers do not like new ideas, not when the new ideas affect money. This is what my survey showed : not one of those bank managers would even discuss managed currency with me. They thought I should be locked up as a menace to the State. That is what they thought. You could just see they hoped that some day I would issue a rubber cheque or overdraw my account, or forget my own name when signing a cheque. You could just see they were only waiting for an opportunity to introduce me to the keeper of the local Bastille.
Afterward I was inclined to sympathize with these bank managers. I felt I should go around and apologize to these bank managers. I felt that way but I didn’t. Never apologize to a bank manager out of the goodness of your heart. Save up these apologies for the dark hours when you just have to explain and apologize to bank managers. You will feel then that that is enough apologies. You will, indeed.
I found out about managed currency. I found out and I was sorry for the bank managers. An economist told me about managed currency. I know this economist well. I asked him and he told me. It is all right to know an
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economist, and it is permissible to talk to an economist. But do not, do not under any circumstances, ask an economist about managed currency, wheat marketing, or what constitutes money. Do not ask an economist any of these foolish questions because the answers won't do you any good.
I was walking to my office at two o’clock of a fine afternoon when I met my economist friend and asked him about managed currency. He said: “Well now, let me see. It is really very simple. It is a good thing really. I approve of it.” Then he began to tell me. My economist friend forgot everything else, and that newspaper reporters have to go places and write stories, misquote people and lead Bohemian lives. I understand that normally he is a kind husband, a loving father and that he spends his spare time breeding tulips. He is these things when not being an economist.
As I say, I met him at two o’clock of a fine afternoon. He finished explaining to me at six that evening. He finished explaining because I suddenly ran out into the traffic and jumped into an empty taxicab. He was still making figures on the back of an envelope when I looked out the taxicab window. I have stayed away from him ever since. I have, indeed. I am a Presbyterian by training and a Conservative by birth, and I do not believe in mixing with people who would wilfully mistake a printing press for the Federal gold reserve. The very thought of it makes me feel queer. It makes me feel queer because the police have been strenuously objecting to this sort of thing for such a long, long time.
My economist friend began right at the beginning. First, he said, we would have to create a board of management to manage the managed currency, and in order to remove managed currency from any possible influence by the great financial institutions or the political parties. I could see right away that this managed currency was going to be for the people, so I cheered in the right place. I have attended several political meetings in my time, so I cheered in exactly the right place. My economist friend was annoyed but he kept right on. The only difficulty, he said, would be to decide who would be on the board of management. I admitted that would be a trouble worth thinking about. I pointed out that Canada’s population was supposed to be about ten million souls, and that that might be an unwieldy number to have on a board of management.
A Lesson in Economics
MY ECONOMIST disregarded me. He did not even hear me. He was explaining. He explained, using words and sentences, and figures on the backs of envelopes, and some blank cheques which I gave him when I saw they were not going to be of any further use to me. He explained, and it dawned on me that he was wrecking the financial structure and building one to suit himself. It was plain that his board of management would regard the sacred gold reserve as an archaic gold reserve and as something suitable for use in gilding the Peace Tower on the Parliament Buildings at Ottawa. Under the circumstances, it occurred to me that gilding the Peace Tower would be a good thing to do with the gold reserve. It would comfort the people to know that they owned a gilded peace tower. It would be in keeping with some of the other things the people own, and it would comfort us. We could point with pride. The Board of Management would take the gold reserve away from the Minister of Finance and install printing presses in the vacant spaces of the Finance Department. I interrupted my economist when I understood so far. I shook him awake and I asked who was going to make the deal with the secret service department of the Royal Canadian Mounted Police. These secret sendee boys, I pointed out, have some funny archaic ideas about printing presses and money not even distantly related to the gold reserve. He said there would be a law authorizing the issue of fiat
money. That is the kind of money you have with managed currency. It is issued and you : believe it is money. You believe this because | of your trustful nature.
Faith But No Money
Y ECONOMIST admitted there was ¡ a practical objection to issuing fiat | money. No one, he said, had yet advanced a I sensible answer to the question of how to ! get it into circulation. That, he admitted, i was the problem which really bothered him. The Government, he argued, couldn’t give ! money away, not even to the banks, and it : would take so much of it to pay bills incurred when the currency was mismanaged but backed by gold. He was not discouraged. We are going to overcome this difficulty. We are going to do it by faith. My economist has faith, and no money. You would be surprised at the number of economists who have faith and no money. You would, indeed. There are lots of them and they are all in favor of managed currency. My economist said: “Now we have this fiat
money, and we have found a way to distribute it on an equitable basis in so far as the producersand the consumers are concerned.’*
I objected. You admit, I pleaded, that the money cannot be distributed equitably.
“We have,” he said, “distributed it in theory.”
There is no use arguing with an economist. They should work for some city editors I know. I would go miles and miles, and then a long distance to hear an economist tell one of these city editors that he had covered a meeting of the city fathers in theory. Oh, dear me! I would, indeed. I knew a newspaper man once who said he came from Boston, and this newspaper man told a city editor we both worked for that he would get him the details of a meeting when the principals were at leisure. 1 heard that with my own ears, so now you know why I would like to see an economist try a theory on a city editor.
My economist, as I say, distributed his fiat money in theory, and right there I began to feel a fellow feeling for the bank managers. Fiat money in theory is hard on bank managers. The very thought of it makes them nervous. Then 1 found out how fiat money works, and right there was when I began thinking of running rapidly away. The Board of Management works it. It does, indeed. Oh, dear me! The Board of Management wakes up one fine morning and in comes a man and says: “Gentlemen of the Board, commodity prices”—meaning what you pay for what you think you need —“are much too low and we are about to be ruined.”
“Ruined,” says the Board. “Ruined. Is it as bad as that? Boy, just get the head of the printing department on the telephone.”
And the boy does, being a well managed boy in theory, and the Board orders the printer to turn loose the wolf and print a few bales of ten dollar notes. This money is issued and up go the commodity prices, meaning that the consumer pays more for what he thinks he needs, because he has more money, also in theory.
“Inversely, the Board can reduce commodity prices by decreasing the amount of money in circulation.”
The sentence immediately foregoing is stolen from my economist. Never in my life have I originated a sentence like that. No, indeed. My economist does not know exactly how the Board is going to get the fiat money back into the store room. I should say not, but the theory, he says, is sound. He said he would prove it was sound. He said he would but, as I say, I jumped into a taxi and left him on a street comer. I went home and I talked it over with Josephus McDermott, my black gentleman cat who learned to like olives. Josephus McDermott left the room. A black gentleman cat leaving a room is most expressive. I wish I could treat my city editor the way Josephus McDermott treats me.