II

INFLATION AND DEFLATION

167

in my judgement, in wages and salaries, or a de-cisive change in the international position. Anattack on wages would mean a severe industrialstruggle which would drive us off gold-paritywithin a few weeks; so that this is not in practicean alternative to Devaluation. Thus there areonly three lines of policy to which it is worth theCabinet’s while to direct their minds. The firstand mildest is a plan for the restriction of im-ports. The second is a plan for getting off gold-parity without allowing the slide to go too far.The third is a plan for an International Confer-ence—one that means business of the mostdefinite kind, quite different from any Confer-ence ever held hitherto—for giving the gold-standard countries a last opportunity. All therest is waste of time. The advantage of the lastalternative is that this alone offers any chance,however slight, of an amelioration of the inter-national position, without which we are facedwith a disappearance of income from our foreigninvestments on a scale which neither a Tariff norDevaluation could offset.