8

HOW TO PAY FOR THE WAR

CHAPTER n

THE CHARACTER OF THE SOLUTION

Even if there were no increases in the rates ofmoney-wages, the total of money-earnings will beconsiderably increased by the greater number ofinsured men engaged in the services and in civilianemployments, by overtime, and by the movementinto paid employment of women, boys, retired per-sons and others who were not previously occupied.

It will be shown in the next chapter, what isfairly obvious to common sense, that in a warlike this the amount of goods available for con-sumption will have to be diminished,—and cer-tainly cannot be increased above what it was inpeace time.

It follows that the increased quantity of moneyavailable to be spent in the pockets of consumerswill meet a quantity of goods which is not in-creased. Unless we establish iron regulationslimiting what is to be sold and establishingmaximum prices for every article of consumption,with the result that there is nothing left to buyand the consumer goes home with the moneyburning his pocket, there are only two alternatives.Some means must be found for withdrawing pur-chasing power from the market; or prices mustrise until the available goods are selling at figureswhich absorb the increased quantity of expendi-ture,—in other words the method of inflation.