Page:The Economics of Unemployment.djvu/152

fore. Nor would the necessary incentives to such saving be lacking in the new order.

If by such improvements in distribution the rates of production and consumption were so well adjusted as to reduce to small dimensions the fluctuations of employment, the largely superstitious influence of confidence and credit in the causation and enlargement of these fluctuations would tend to disappear. For the regularity of actual business operations, thus obtained, would be reflected in a steadiness of prices precluding the swift enlargements and contractions of credit which stimulate and exaggerate our cyclical fluctuations. For if the actual industrial system were kept in regular and full employment by the removal of restrictions in the market, speculation and expansion of credit would be confined to narrow limits. Once remove the opportunities which the conjunction of rising prices and unemployed productive resources afford to business men and financiers of reaping large and quick gains from getting control of large stocks in a rising market, you destroy the demand for inflated credit and the over-confidence engendered in the atmosphere of business speculation.

The roots of irregularity and fluctuation of industry lie in defects of distribution and of demand, not in the miscalculations of business men or the aberrations of the monetary system, which are but exaggerated reflections of the real facts of industry.

Considerations of the enfeebled and confused condition in which the Great War and the Bad Peace have left the industrial, commercial and financial system of the world, impair no whit the validity of