Page:The Economics of Unemployment.djvu/111

A wider aspect of the credit question remains for consideration in connection with the present and prospective situation. The use of abundant bank credits during a trade expansion operates, as we recognise, favourably to profits, unfavourably to wages, owing to the wage-lag. During a trade depression the balance is temporarily redressed, at any rate in part, wages and subsidies for unemployment forming a larger proportion of the reduced current real income than in normal times. But since the operations of credit admittedly serve to exaggerate the fluctuations of prices and of trade, they afford increased opportunities to make gains out of speculation and manipulation of the money and the produce-markets. As the ordinary business man becomes more dependent upon bank asistance, alike for doing profitable trade in good times and for holding on in bad times, bankers, and other manufacturers of credit, are in a position to take a heavier toll from industry and commerce. Though it is easy to exaggerate the share of the general income which thus passes to the controllers of finance, its growing size is a factor in the problem of distribution. But the operation of credit serving, as we saw, to swell profits of business men in times of