Treasury Bill

In an all-night session of the Chamber of Deputies, Finance Minister Joseph Caillaux battled in an arduous fight for a bill to relieve the Treasury.

Basing his demands on the fact that the Treasury had to meet more than 21,000,000,000 francs of maturing short-term bonds and that the total note circulation was only 46,000,000,000 francs, the Finance Minister said it did not matter how much fiduciary circulation the State carried in paper currency and how much was in bonds. Accordingly he asked for:

1) Power to control departmental expenditure.

2) Authority to issue 6,000,000,000 francs of unsecured paper currency.

3) Authority to issue new bonds, limited for subscription to present bond holders, with a decreased rate of interest to be fixed by decree, and carrying, as an inducement, a guarantee of redemption in gold.

4) Fixation of the total floating debt of the Treasury at the sum reached on closure subscription to the above loan.

Debate began at 10.30 p. m. and special votes were taken on Articles 2 and 3, which were passed respectively by 328 to 119 votes and 373 to 36 votes.

At 4 a. m. the Socialists put in a determined plea for the pet project of capital levy. After considerable discussion a Socialist amendment supporting the levy was defeated 340 to 210. A vote was then taken on M. Caillaux’s bill as a whole and was passed 330 to 40 votes, the Socialists abstaining.

Later in the morning the franc broke on the bourse, dropping 9¾ points to 23 to the dollar—the lowest reached since March of last year.

In the afternoon of the same day the bill was presented to the Senate. First the bill had to be passed by the Senate’s financial commission. M. Caillaux had a hard fight, but so convincing were his arguments and so imperative his manner that the commission passed the measure by 9 votes to 5, with no fewer than 11 abstentions.

To the Senators, M. Caillaux was blunt:

“This project is a liquidation of the past. No other Government in our place could do otherwise. We are in the presence of peril. I do not like inflation any more than you do, but I felt when the first 4,000,000,000 francs of additional issue were authorized a few months ago we should then have made the amount 10,000,000,000.”

After due reflection the Senate agreed, passed the bill by 273 to 11 with numerous abstentions. Next day, President Gaston Doumergue affixed his signature to the measure and it forthwith became the law of France.

Perhaps, never in the history of the Chamber has so important a piece of legislation been passed in so short a space of time.