The Daily Worker Newspaper, July 28, 1925, Page 4

Page Four THE DAILY, WOR GERMAN NATIONALISTS EXPOSED . ASMMISERABLE MERCENARIES OF THE BRITISH IMPERIALISTS (By International Press Correspondence.) MOSCOW, July 10.—(By Mail.)—Today’s leading article in the Pravda, official organ of the Russian Communist Party, points out that at the present time of the intervention plans of England against Soviet Russia, important circles of the German bourgeoisie are falling,in at the tail of the English imperialist policy. To the warnings of the Soviet press that the entry of Germany into the league of nations would mean Germany's entry into the anti-Soviet front, Germany declared that it was in no way a question of an alteration of Ger- attitude. Germany would never give up its political independence and sovereignty and its friendship to Soviet Russia would remain unchanged: Nevertheless in the last few weeks a shameful and systematic anti-Soviet’ campaign has been going on which finds its expres- +— — sion also in the official policy of Ger-| German papers peril’ tnemselves a many. tone towards Soviet Russta which is in no way in agreement with friendly relations, Under the pretext of the judgment n the Moscow fascist process, several RUSSIA T (Continued from Saturday's Daily Worker ) CHAPTER II Finance Russian Credit before the Revolution The Russian national bankruptcy was not, as is generally supposed, a consequence, but rather a cause of the Revolution. The fiscal relationship of Tsarism to the Russian taxpayer and its financial relationship to the foreign creditor had become almost as bad as that which resulted from a similar recourse to foreign money lenders by oriental despotisms in Turkey, Egypt. and Morocco. Tsarism was approaching bankruptcy long before the war; though Russian credit abroad was still maintained by foreign financial groups, who promoted Russian loans and passed on the liability to a public ignorant of the political instab- ility and financial unsoundness of the Empire. A process which would, as elsewhere, have ended before long in the foreign creditor losing most of his investment and in the Russian tax- payer being put under a foreign receivership to pay for the follies of his rulers. Currency Before the Revolution But up to the war this process had not gone so far as to affect the currency. Paper money in Russia was issued under restrictions more rigorous than elsewhere, having to be covered to one-half in gold reserve up to a total issue of 600. million roubles, and wholly covered by. gold above that amount. This syetcm, as elsewhere, gave way, to the exigencies of war. The Imperial Bank was given the right of emission, without reference to gold reserves, within restrictions that were being continually reduced. The growing deficit in the budget was covered partly by this means and partly by borrowing. By 1917 the Russian debt reached 17 milliards gold, of which about half had been borrowed abroad. The deficit by 1917 had risen to 2514 milliards paper, of which three-fourths was being paid by the issue of paper money. By 1916 the limitation on the issue of currency had been raised to 6! milliards. The paper currency was inflated from 1,317 in 1914 to 2,670 in 1915; to 3,480 in 1916, and to 16,403 at the date of the Revolution—against a gold reserve of 6.8 per cent. The usual results of inflation followed, and the rise of prices soon became serious. Already before the Revolution the currency had depreciated by two-thirds. This, though small in figure compared to the future depreciation after the Revolution to one five thousand millionths, was in effect far more fatal. For it started the usual vicious circle revolving— the greater the mass of money issued, the less it was worth and the more was wanted, There were present before the Revolu- tion all the usual symptoms of the latest stages of excessive in- flation. Production, at first abnormally forced, inevitably fell; and the whole national economic existence was passing from a stage of fever to that of torpor. / Russia was not only so bankrupt before the Revolution that it could never hope to carry the burden of the debt it had accumulated, but it was already economically paralysed by currency depreciation. Revolution and Finance This was the financial situation for which the Revolution had to find a remedy. And under conditions of Revolution it was in any case inevitable that the situation must get worse before it could be remedied. The principles of sound finance cannot be observed during war, and the Revolution involved Russia in foreign war, in civil war, and in class war.’ The finan- cial effects of these foreign and civil wars need not be gone into in detail. For owing. to.the responsibility incurred by Foreign Powers the estimates:of pecuniary damage caused. to Russia by civil wars have already been published by the Rugsian Govern- ment in the course of negotiations for the settlement of mutual claims. But the damage caused by the class war was of a different and more novel character. It was not expressed in incidental destructions and disorders that could be estimated in terms of money. Jt was expressed in a deliberate and determined attempt by those conducting the Revolution to déstroy the insti- tution of money ‘Itself as well as its influence over the social system. War Communism) and Finance War Communism Was brought to making this attack pon money by two inter-connecting influences. One was the desire to abolish money as being the principal means for accumulating private capital, and the other was the difficulty of restoring a Stable unit of exchange out of the chaos of different and more or less hopelessly depreciated currencies that the Revolution had inherited from the war. And, as nationalisation of trade and property developed until the free exchange of commodities was ‘ almost eliminated, the function of money as a medium of free exchange diminished. Until finally War Communism came to the conclusion that the best solution both in principle and prac- tically, would be to do without money altogether; and that the best means to that end would be to let it depreciate itself out of . existence. The idea which was inspiring the leaders of the Revolution when the prévious Delegation visited Moscow in.4920 was that of reconstructing the national economy as one great co-opera- tive of consumers and producers, of which the economic ex- changes would be merely a matter of bookkeeping through een- _tral and local clearing houses. Under the decree of the 7th of “May, 1918, all pecuniary revenues and resources of the nation- alised institutions were to be paid into the National Bank or 7 Treasury—all other payments being made by cheque or Need Campaign of Propaganda. The Pravda further pointsout that a German observer like’ the’ lawyer Freund could not but declare that the prosecutor had succeeded in proving the guilt of the accused. The whole noise about the consul process proves itself to be an artificial, irresponsible press production in the sharpest con- tradiction to the real national inter- ests of Germany, What is much more important is the recognition by the Frankfurter Zei- tung in its issue of July 4, that there is no longer any doubt that the great efforts of England to draw Germany into the guarantee pact is an attempt to involve Germany in the antl- Russ- ian front. It is now clear to the most naive why the press campaign ts necessary, why all attempts are made to outdo England in the anti-Soviet crusade. In this light the hypocritical, assumed indignation of the Berliner Tageblatt and its language, unworthy of an in- dependent people, towards the Soviet Union is to be explained. The German nationalists whose slo- gan until recently was hate against England now appear as the miserable oe a eet mercenaries of Bi perialism. The i been “bartered fot which would accrue fi a gendarme role towards the Sov{@t Union. Cannot Play Role,of Flunkey. If Germany wishes t@, have a per- manent perspective.of independent de- velopment before it, it cannot afford to sell itself,’ bag and bagage, to Eng- lish imperialism, It should also not play the role of a subservient and fawning flunkey. We declare once again with all determin- ation: we shall not permit ourselves to be the object of the bargam. We declare also with the same de- cision our determination to do our ut- most to build up economic relations with Germany. Only the blind cannot } see what hopeful .prospects /such a connection offers to both countries, and this connection is to, be destroyed by England and her agents in Ger- many, Curzon Literary Supplement Missing LONDON, July 26.—The will of Marquess Curzon formally filed today in somerset house, did not include the famous literary supplement, the exist ence of which created a’sensation in \ political circles earlier in the week. | Boxes of valuable bullion establish Russian credit in’ British, capit: UNION Thru Courtesy of the International Pub- lishers Co. draft, and only small sums being retained for current accounts. All manufactured products issued were credited to the compe- tent Head Centre (Glavprom), and all raw mateials drawn were debited to the enterprise concerned—the accounts being subsequently balanced and cleared if necessary by a subsidy. This system was gradually developed until it included over four- fifths of all urban production and consumption, and reached its limit in a decree of January 6th, 1920, which extended it to the co-operatives. As War Communism developed, more and more strenuous efforts were made to set up a mechanism that would carry out this immense task. The decree of January 19th, 1920, converted the National Bank into a central accounting departrivent, and the paper money which was then issued was known’ officially as accountancy certificates (Raschetny znak). The ‘decree of June 18th, 1920, proclaimed a policy of “converting the national budget into a budget of unified economy for, the whole State, and establishing a national accountancy without money.in order to abolish the whole monetary system.” Moreover, in’ view of the continually depreciating values of the ordinary ‘currency, it was decided under decree of January 10th, 1920, te'take as a basis of the national accountancy a unit expressing man- power instead of money. A Commission was still at work on this exciting experiment when in 1921 the whole adventure of War Communism was abandoned. fe iy War Communism and Revenues : One result of thus boldly breaking ‘up the whole system of monetary exchange was that the fiscal machinery broke down. During 1918 and 1919 efforts were made to adapt the incidence and collection of taxes and revenue to the new system. As late , as June 18th, 1920, a resolution of the Central Executive Com- mittee was inspired by this reformist policy. But goon after, the ordinary collection of revenue was practically abandoned and it was formally abolished by decree of February rd, 1921, on the eve of the New Economic Policy. In 1918.the revenues from taxation were estimated by competent authority (Golo- banov, “By New Roads’’)y as being still 153.2 millions in value reckoned by the index. In 1919 this had fallen to 10,2 million, and in 1920 to 0.2 million. While with the abandonment of War Communism that winter, it was restored in 1921 to 3.7 million. i Communism and Currency Meantime nationalization was never brought to a point at which money could be completely ignored in the budget. And the only means of providing such money as was still required was the issuing of .paper currency. A decree »of May 15th, 1919, authorized such emissions without any restrictions, and the issue of fresh paper under such conditions caused, of course, a disproportionate depreciation. In the 32 months of War Communism we find the nominal amount of currency in- creased a hundredfold. The consequence was that -as the nominal amount of money increased, the real amount decreased, as also did the revenue received. Communism and Budget It was hoped that by the time the currency had fallen to a point at which it would be less in value than the paper it was printed on, the new money-less mechanism would be working. But it never did work, It will, indeed, now probably never be known what measure of success was really achieved in this Utopian undertaking of organising, in the general public in- terest, the whole economic exchanges between production and consumption in a country of the area and population of Russia. For all efforts, so far, by Russian economists to find out how far the general economic plan and the system of clearing, houses and central accountancy was carried into effect, have failed to pro- duce any clear results. As one such economist observed (Larin, “Roads to Currency Reform,” page 17): “The figures of the iS aig in the years 1918-1921, only served to illustrate certain interesting tendencies.” Subject to this caution thé figures are herewith given, together with those of the Tsarist War Budgets :— . TSARIST WAR BUDGETS (Million roubles.) Per cent of Per cent deficit to total “deficit covered Expenditure Revenue Deficit expenditure by currency 1913 3,883 3,431 452 11.6 =~ 1914 4,859 2,961 1,898 39.1 _ 1915 11,562 3,001 8,561 74.0 31.0 1916 18,101 4,345 13,756 76.0 . 25.0 1917 30,607 5,039 25,568 83.5 b 73.0 SOVIETIST WAR BUDGETS (Million roubles.) Per cent of Pet cent i deficit to total deficit covered Expenditure Revenue Deficit expenditure by currency 1918 46,709 15,580 31,129 67.0 94.0 1919 . 216,402 48,959 166,443 70 102.0 1920. 1,215,159 159,604 1,055,555 87.0 89.0 1921 srrsssee 26,076,816 4,139,000 21,937,816 84.0 63.0 Restoration of Money , With the introduction of the New Economic Policy and the gradual re-establishment of free exchange, money as a medium of exchange became indispensable. t the whole process of retarn to normal conditions lasted o two years, during which several attempts were made to escape recourse to money by experiments in commodity currency. ). The first concession from War Communism iy finance was made to the Co-operatives, which under decree of June 10th, 1921, were allowed to dispose of their own funds, This was then extended d. (June 30th), and finally to the State aPriece persons “enti ises (August 16th). The restoration of the THE OFFICIAL REPORT OF THE BRITISH TRADE DELEGATION TO SOVIET RUSSIA Copyright in the United States by the International Publishers Co, All Rights Reserved. Copyright by the Trades Union Congress General Council in Great Britain. right of free internal trade and the reconstruction of economic enterprise, both public and private, on a business basis, brought back a general system of money payments. A decree of August 5th, 1921, made money payment obligatory for all supplies from or services by State enterprises. Herewith went naturally the restoration of taxation, which took the form of an income tax and excises on wine, tobacco, coffee, and such usual sources of revenue, Restoration of Budget The first attempt to restore a normal financial system was the “experimental budget” for nine months of 1922,, which had, however, to be three times revised. The budget for 1922-23 was scarcely less hypothetical, and the first budget whose figures had any real relation to facts Was that of 1923-24. (Financial year begins on October 1.) pe The task of bringing order out of chaos was formidable; for the whole financial and fiscal system had to be rebuilt on fresh foundations. In.1922 the budget was still being based up to four-fifths on commodity exchanges, not on currency pay- ments. On the other hand, it was useless to try. to.revive the pre-war financial and fiscal system, which had in the first place entirely disappeared, and in the second place was not adapted to the new conditions. Consequently, not only every principle but every practcial detail had to be worked out afresh as a compro- mise between Communist theory and the force of circumstances. These compromises were a far more severe test of the ability and the authority of the leaders of the Revolution than had been their preceding more ambitious attempts to liquidate the legacy of debt and depreciation left. by the war. : The restoration of the budget to a business basis was fur- ther complicated by the continued depreciation of the currency, MOVEMENT TO SEND BIBLE TO THE JUNK PILE Washington Clerk Out for Injunction EDITOR'S NOTE—The clash be- tween religion and science which has stirred the country deeply in the last few weeks has been placed squarely before the federal courts by an action brot in the district of Columbia su- preme court by Loren H, Wittner, a treasury employe. Wittner charges that congress is attempting “to set up a state religion in the Washington public schools.” In the following article, Wittner tells why he started the sult, reveals his purposes id outlines what he believes the federal court must decide in the injunction hearing next Tues- day. By LOREN H. WITTNER. (Special to The Dally Worker) WASHINGTON, July 26.—I am ighting for the freedom of religion, education, speech’ and press as guar- anteed in the first amendment to the '} constitution, I'am not quarreling with the belief of the people. It is all right for them to believe or not to believe in the bible. Of late years, however, there has been a decided tendency all over the country for legislative bodies to in- terefere and restrict and confine edu- cation within narrow limits. That was exemplified in Tennessee in the pass- age of the anti-evolution law. It brot about the Scopes trial. Now congress has stepped in, and with an heretofore unnoticed “rider” in the district apprortatton bill has decreed that nothing must be taught in Washington schools which incul- cates “disrespect to the holy bible.” Science Contradicts Bible. What constitutes disrespect to the holy bible? Does it mean the teaching of natur- al science? Surely, it must for na- tural science, contradicts the teach- ings of the bible. In short, it denies the bible. What could be more dis- respectful? To determine this question legally, I have brot suit to enjoin salaries of instructors who teach scientific doc- trines which are at variance with the bible. That is my motive. Unless the question is decided upon which necessitated a monthly revaluation of the rouble with | conreeee technicalities, the court must reference to its buying value in 1913. This was:accompanied | i"form the country whether geology, by periodic revaluations of the various emissions ‘6f* paper cur- rency, some of which were entirely devalued—stich as those issued by reactionary regimes—while others became devalued gradually. , Collapse of Currency Meantime the printing press had again to pay the budgetary deficit and tide over this second transition. The nominal amount in circulation in January, 1923, just before the reform, was just under two thousand million millions. If the, nominal ‘value of this amount be converted into real value we find that the Gov- ernment succeeded in obtaining by this means revenues about sufficient to. cover, hat the real money deficit probably was. These revenues amounted in 1920 to 130 million, in 1921 to 148 million and in 1922, after the restoration of money, to’ about 300 million. The smallest returns from this source were in April, May, and June, 1922, which was the crisis of the transition back to normal conditions. It was fortunate that at this time the State was favored by one factor, namely, that during 1921, when circulation increascd 136 times, prices only rose about half that proportion, namely, 71 times. As it was a question of months whether the currency, would retain 8cme real value long enough for the State to reach currency reform in its program, this success in keeping prices down probably saved the situation. After mid-summer, 1922, there was a definite turn for the better. It is true that the totals of currency issued became astronomical, and the technical limitations of the printing press were already in sight even though the paper chase in Russia never Lecame quite such a wild goose’ chase as_in Germany. But what mattered was that the revenue proceeds therefrom began nevertheless to increase and the to decrease, Currency Keform bang ti From this point the road to currency reform followed by the Russians was much ‘h6 same as thar by which the Germans extricated Uicmselv ‘s from their catastrophe. In fact, the Rus- n precedent now hecomes very instiuctive as to at can be dene hy @ strong Govcrnment wit! sut outside Help! in saving a desperate financial siuation. OP Ee The first effort to stabilise the currency Was troduction unit in ‘should be by decree on June 5th, 1921, of the “pre-war rt which all paycients and accounts, public and priy: reckoned. This had, however, to be abandoned in. fayour of a less drastic method, that of fixing an official ge basec on foreign exchange. The difficulty of fixing and paying wages under this method caused the recourse to “goods roubles,” a unit calculated from the index of prices, and consequently also called an “index rouble.” This was practically a return to the pre-war rouble. Moreover, as pre-war prices were gold prices, the step from the goods rouble to the gold rouble was in prin- ciple small, though the practical difficulty of introducing a return to gold was very great. And there was also a strong sentimental objection to the restoration of gold as a standard of value, for it was feared that this would re-open the door to speculative profiteering and foreign penetration. So the theoretic discus- sions between partisans.of the goods rouble and those of the gold rouble soon became as interminable as intricate, and those in favor of the goods roubles had the best of the argument. But long before the fervor of controversy was exhausted, the force of Meharry 344 had decided in favor of gold roubles. The whole principle of N: 8, P. was the restoration of all enterprises and exchanges to a business basis; and a business basis in this sense implied a foundation on a gold standard. If the.State had not itself restored such a standard in some form, busine have worked one oiat for itself as in Germany; albices 4 a foreign standard, §uch as the dollar or by restor war rouble, So (COstinued in next issue ‘ using biology, chemistry, physics and all sciences are disrespectful to the bible. But the legal phase is not para- mount. There is another and a greater is- sue involved. It is this: Is congress to be allowed to con- tinue its present course of setting up the bible as the final authority on scientific knowledge? Unsteady Crucible of Religion. That must never be. If I do noth- ing else, I hope I have shown the country thru this suit that congress deliberately intends that all educa- tion must be tested in the unsteady crucible of religion; that, in fact, re- ligion must come ahead of education in our schools, or, there can be no education. In a strict sense, there- fore, congress has definitely linked the state with religion. If congress does not intend that, then congress has been guilty of care- less legislation. It is time now that congress is warned the country will not tolerate religion in legislation, for it subverts a cardinal American principle. If this continues, we shall be in- tellectual serfs, bound in the ignor- proportional rise in prices ! duce and intolerance of the darkest ai ages, sre my Says Scopes Case Worth While. OBERLIN, Ohio, July 26. — The Scopes case was worth while because a sincere study of evolution is result- ing, especially in Tennessee, in the opinion of Dr. Maynard M. Metcalf, of Oberlin, only expert witness who test- ified before the Dayton, Tenn., court. Dr. Metcalf today told some of his impressions of the famous trial. “I think the local educational effect ot the trial was considerable and yorth while,” Dr, Metcalf said. “The veople in the region around Dayton are just like any other people in na- tural ability, unless indeed they are more than of average natural ability, but they have had very limited con- tact with the world’s thinking, and they are decades behind the times in thought. As a result of the trial there aré a good many persons who are inquiring with open minds about this matter of opposition between re- ligion and science,” New Bail Hearing for Stephenson NOBLESVILLE, Ind., July 26,—The petition for a re-hearing of the motion to admit to bail D, ©. Stephenson, Rarl Klinck and Earl Gentry, alleged murderers of Madge, Oberholtzer, will be heard by Judge Fred Hines next Wednesday. This answer was given by Judge Hines to attorneys for the accused men who appeared before him and wked for a ruling on the petition for ve-hearing the bail motion. . ‘ — ee emeeen ass