Ill

THE RETURN TO GOLD

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that the same standard of value should beadopted at home and abroad; whereas an in-ternal standard, so regulated as to maintainstability in an index number of prices, is a diffi-cult scientific innovation, never yet put intopractice.

At any rate the unthinking assumption, infavour of the restoration of a fixed exchange asthe one thing to aim at, requires more examina-tion than it sometimes receives. Especially isthis the case if the prospect that a majority ofcountries will adopt the same standard is stillremote. When by adopting the gold standardwe could achieve stability of exchange withalmost the whole world, whilst any other stand-ard would have appeared as a solitary eccen-tricity, the solid advantages of certainty andconvenience supported the conservative prefer-ence for gold. Nevertheless, even so, the con-venience of traders and the primitive passion forsolid metal might not, I think, have been ade-quate to preserve the dynasty of gold, if it hadnot been for another, half-accidental circum-stance; namely, that for many years past goldhad afforded not only a stable exchange but, onthe whole, a stable price level also. In fact, thechoice between stable exchanges and stableprices had not presented itself as an acutedilemma. And when, prior to the developmentof the South African mines, we seemed to befaced with a continuously falling price level,the fierceness of the bimetallic controversy testi-fied to the discontent provoked as soon as the