VALUE OF NOTES 
57 
although it will buy less than before. The answer to 
this is that it implies that value can and must pro- 
perly be measured in labour cost of production instead 
of in commodities and services ; the idea is that it 
has become more difficult to get gold and other 
commodities, and therefore they are more valuable, 
and the higher price in the unit of account merely 
gives expression te this, and therefore has not been 
produced by the issue. But we do not measure, and 
we do not wan* to measure, value in labour-cost of 
production ; if we aid so measure it, everything in 
savage or primitive times when the productiveness of 
industry is very low would be of enormous value. 
So this answer would be of no use if it were true, and 
that it is seldom, .f ever, true is suggested by the 
fact that it has almost always been put forward as 
one of the defences of over-issue, and it seems unlikely 
that inconvertibility and a decline in the productive- 
ness of industry so often go together. 
4. The more acute Government apologists content 
themselves with alleging that the issue is only one 
of two or more causes tending to raise prices. There 
are always many causes tending to raise prices, so 
that this is sure to be tr:- and .t does not in the 
least destroy the force of tiie proposition that the 
issue tends to raise prices. 
5. We now come to what is at once the most 
insidious and the most dangerous of all the arguments 
in favour of increasing issues. This is that the 
issuers have no control over the issue and that it is 
‘“ automatic,” as it only takes place when the notes 
are asked for, so that they are ‘‘ issued in response 
to a genuine di mand and not forced on people.” It 
might as w "= rlaimed that the issue of pocket- 
money ‘ - not under the control of its 
parents b.caus. avtomatic, only taking place 
when 17° mc a’ .& for. Qld-age pensions,