An individual when he goes bankrupt is measured by the monetary standard of the country he is in; he pays five or ten or fifteen or so many shillings in the pound.  A community in debt does something which is in effect the same, but in appearance rather different.  It still pays a pound, but the purchasing power of the pound has diminished.  This is what is happening all over the world to-day; there is a rise in prices.  This is automatic national bankruptcy; unplanned, though perhaps not unforeseen.  It is not a deliberate State act, but a consequence of the interruption of communications, the diversion of productive energy, the increased demand for many necessities by the Government and the general waste under war conditions.

At the beginning of this war England had a certain national debt; it has paid off none of that original debt; it has added to it tremendously; so far as money and bankers’ records go it still owes and intends to pay that original debt; but if you translate the language of L.s.d. into realities, you will find that in loaves or iron or copper or hours of toil, or indeed in any reality except gold, it owes now, so far as that original debt goes, far less than it did at the outset.  As the war goes on and the rise in prices continues, the subsequent borrowings and contracts are undergoing a similar bankrupt reduction.  The attempt of the landlord of small weekly and annual properties to adjust himself to the new conditions by raising rents is being checked by legislation in Great Britain, and has been completely checked in France.  The attempts of labour to readjust wages have been partially successful in spite of the eloquent protests of those great exponents of plain living, economy, abstinence, and honest, modest, underpaid toil, Messrs. Asquith, McKenna, and Runciman.  It is doubtful if the rise in wages is keeping pace with the rise in prices.  So far as it fails to do so the load is on the usual pack animal, the poor man.

The rest of the loss falls chiefly upon the creditor class, the people with fixed incomes and fixed salaries, the landlords, who have let at long leases, the people with pensions, endowed institutions, the Church, insurance companies, and the like.  They are all being scaled down.  They are all more able to stand scaling down than the proletarians.

Assuming that it is possible to bring up wages to the level of the higher prices, and that the rise in rents can be checked by legislation or captured by taxation, the rise in prices is, on the whole, a thing to the advantage of the propertyless man as against accumulated property.  It writes off the past and clears the way for a fresh start in the future.

An age of cheapness is an old usurers’ age.  England before the war was a paradise of ancient usuries; everywhere were great houses and enclosed parks; the multitude of gentlemen’s servants and golf clubs and such like excrescences of the comfort of prosperous people was perpetually increasing; it did not “pay” to build labourers’ cottages, and the more expensive sort of automobile had driven the bicycle as a pleasure vehicle off the roads.  Western Europe was running to fat and not to muscle, as America is to-day.