TO DISCOVER A STABLE STANDARD 191 
rise in the rate of interest, whereas revenues increase more 
nearly in proportion to the rise in prices. 
But the tables may be turned when the public debt is 
practically wiped out by the unlimited depreciation of the 
currency and the Budget no longer contains any expendi- 
ture except in respect of staff and material, items which 
increase in direct proportion to the depreciation, whereas 
the returns from taxation lag behind the movement of 
prices. 
As depreciation progresses and is accelerated, efforts 
are multiplied to counteract its effects continually and 
automatically in all relations between creditors and 
debtors; scales of salary are set up which vary auto- 
matically with the cost of living (internal purchasing 
power of currency) or with the value of gold. Most 
commercial and industrial transactions are based on gold— 
In practice, on some foreign currency. As shown above, 
gold loans are issued and taxes are collected in gold by the 
same method.! This procedure approaches as nearly as 
possible to the logical system of neutralising variations in 
purchasing power of currency by applying coefficients pro- 
portionate to such changes and also varying according to 
the date at which payment is effected. But even apart from 
the enormous accounting difficulties implied by such a sys- 
tem, it hardly seems possible to apply it uniformly. Changes 
in purchasing power are sometimes so rapid and so great 
that even with scales of salaries which vary every fortnight 
or every week, a workman cannot know for certain what 
quantity of goods he will be able to purchase from one 
day to another with the sum of money which is supposed 
to support him until his next pay ‘day. Still worse, a 
peasant who has sold his products on the market, what- 
ever immediate profit he may have realised, does not know 
! See the preceding account of the collection of taxes in Germany. The 
same method was introduced in a more elaborate form in Poland, where the 
“zloty” was introduced as a unit for measuring and assessing taxes; the 
zloty was supposed to represent the purchasing power of the amount of 
gold contained in a zloty as published officially in the index of wholesale 
prices; this purchasing power is that of 1914 multiplied by a coefficient 
corresponding to the index.