Farmers Group agreed to accept Government Whips, and their leader, Mr. Heffernan, was given the post of Parliamentary Secretary to the Minister of Finance. Even with the aid of the Farmers, the Government could not muster a majority over Fianna Fail and Labour unless they were backed by Independent votes.

Mr. de Valera, as leader of the Opposition, concentrated on a series of full-dress debates with the object of expounding his social and economic programme. Labour generally voted with him in the divisions, but the Independents supported the Government in sufficient strength to ensure a safe, if small, majority.

With the approval of all groups in the House the Government, on December 4, floated a new 5 per cent. Loan for 7,000,000l., which was issued at 97. The Loan was anchored to the dollar, and 3,000,000l. was issued in New York, where the total amount was oversubscribed in a few hours. It was announced that another 8,000,000l. would be required inside the next two years.

On December 15 Mr. T. M. Healy, who had completed his term of five years as Governor-General, resigned, and was succeeded by Mr. James McNeill, a former member of the Indian Civil Service, who for some time had acted as Free State High Commissioner in London.

CHAPTER III.

FRANCE AND ITALY.

FRANCE.

THE year opened with the Senatorial elections and closed with the preparations for the General Elections of the Chamber. 1927 may indeed be regarded, politically, financially, and diplomatically, as a year of consolidation in France. Stability was sought in every domain, so that the deputies might face the constituencies with a sound record. After the frequent upheavals of previous years, they settled down to solid work under Raymond Poincaré as Prime Minister.

At no time was the Government in real danger. The constant changes which had marked a large part of the 1924-28 Parliamentary period ceased, and M. Poincaré, acting as his own Finance Minister, proceeded with the task he had so well begun in 1926 of restoring the franc to a fairly satisfactory figure, of rendering the floating debt less dangerous, and of balancing the Budget.

The Senatorial elections took place on January 16. In accordance with practice, about a third of the seats were renewable-namely 109. The majority, slightly to the Left, though the

complexion of the Senate is Conservative, remained unchanged. Nevertheless, it is to be noted that at Paris and at Lyons the Socialists and the Radicals gained. Ten Socialists now sit in the Senate and two Senators are nominally Communist. M. de Selves, the President of the Senate, was defeated, as was M. FrançoisAlbert, a former Minister of Education. M. Millerand, the exPresident of the Republic, was also defeated, though he found another seat in the month of October. On the other hand, M. Raoul Péret, the President of the Chamber, was elected to the Senate. When the Chamber met, on January 18, it elected M. Fernand Bouisson, a Socialist, as its President.

The Treaty between France and Rumania was published on January 20. Immediately the Government of Moscow recalled that it had already protested against the Treaty, which promised Rumania the aid of France in the event of war, and proclaimed the common interests of the two countries, without making any reservation respecting Bessarabia. Therefore, Russia held the Franco-Rumanian Treaty to be unfriendly.

M. Poincaré dealt with short-term bonds which were falling due by arranging for the issue of fifteen-year bonds to cover them. These new bonds were offered as payment of four and a half milliard francs of loan redeemable in the course of the year. In addition, three milliard francs of short-term bonds were exchanged in February for ten-year bonds. The committee of an autonomous sinking fund at the same time suppressed six-month bonds. These and similar measures throughout the year greatly improved the financial situation.

Economic readjustment did not proceed smoothly. There was a considerable increase of prices as expressed in real values, and the Chamber insisted on administrative machinery which should control to some extent the cost of commodities. It cannot be said that these efforts produced noticeable results. Moreover, there was unemployment. M. Poincaré, on February 4, declared the crisis to be mild and salutary. Owing to the inflation France had been able to sell abroad under world prices. Now that the engines were reversed, it was inevitable that commerce should be momentarily embarrassed. But the unemployed in the month of February numbered only 56,000, as compared with 1,700,000 unemployed in Germany and a million permanently unemployed in Great Britain. Before the war France had always a minimum of 100,000 unemployed. Therefore, the situation was relatively favourable. France, indeed, had been obliged to encourage the immigration of foreign labourers. As the year wore on these economic problems solved themselves and nothing more was heard of them.

France replied, on February 16, to the American Government, which had invited the Naval Powers to participate in a Conference for the limitation of maritime armaments, to be held at Geneva,

though not under the auspices of the League of Nations. This reply of France was a polite refusal. The French thesis was that armaments could only be treated as a whole, that naval forces could not be separated from terrestrial and aerial forces. Further, France, virtually without modern large vessels, relied upon smaller ships and submarines, and could not allow them to be limited. On March 14 President Coolidge, in a note handed to the French Government by Ambassador Herrick, again appealed to France to send a representative to the Naval Disarmament Conference. He made it clear that there was no intention of hindering the League of Nations' work. But France was too deeply committed to the procedure of the League to acquiesce in the American proposal. The Naval Conference, which was subsequently held, was therefore restricted to the United States, Great Britain, and Japan.

The French attitude on disarmament was peculiar. While it was admitted that the actual number of men under arms should be reduced to the lowest possible proportions compatible with the safety of the nation, and that, as early as possible, conscripts should be made to serve only twelve months or less under the colours instead of eighteen months, yet in considering the problem every circumstance should be ascertained. Notably the industrial organisation of the different countries concerned, their geographical positions, their strategic advantages, and so forth, should be examined as forming part of their potentiel de guerre. M. Paul-Boncour was the chief French exponent at Paris and at Geneva, where he was sent to represent the Government, of this theory of the potentiel de guerre, which necessitated protracted inquiries into national capacity and provoked the criticism that the subject, since it was inexhaustible, would provide matter for debate till the end of time. A still more interesting development was the introduction in the Chamber of a Bill by M. Paul-Boncour which called upon all French citizens, without distinction of age or sex, to join as combatants or as non-combatants in the defence of the country should it be attacked. In the event of aggression there would be universal mobilisation; the whole resources of the country, industrial and financial, would come under State control. These clauses were passed by the Chamber in the month of March, though without any precise organisation they can only have a platonic import. The professed purpose is to eliminate profits in war-time, and to prevent sections of the community evading their duties. It is argued that this comprehensive mobilisation, though useful for defence, will make a war of aggression unthinkable.

The question of disarmament was prominent in the succeeding months. On March 17 France was surprised by a memorandum from the United States Government repudiating many of the suggestions of the Mixed Disarmament Commission, including

the proposals of M. Paul-Boncour for the consideration of war "potentials" and the use of the Defence Budgets as a basis for comparing armaments. The United States could not regard favourably any proposition for international control of essential national industries. Nor could States engage themselves to regard as a common law crime, drill or training on the part of soldiers or civilians in the use of poisons or bacteria. The general effect of the French view, which is supported by the majority of Continental countries, is to postpone any practical steps being taken. In the December meeting of the League of Nations Preparatory Commission, where Russia produced a sensational scheme for instant disarmament, and Germany hinted that if France and other countries did not reduce their armaments Germany must be allowed to increase her armaments to the same level, it was simply resolved to await the report of a committee on security. In all these discussions France has consistently affirmed that security must come before disarmament.

On March 9 the Poincaré method of dealing with inter-allied debts was approved in the Chamber by a vote of 339 to 175-the minority including the Communists, the Socialists, and a fraction of the Radical Party. The position was curious. France had entered into an agreement with Great Britain (the CaillauxChurchill accord) and with the United States (the Mellon-Bérenger accord) by which she undertook to make annual payments. But the Government believed that it was impossible to find a majority for their ratification. To reject them would have caused the most undesirable financial complications. To fail to pay the annuities as they became due might have had equally unpleasant consequences. The Prime Minister, anxious that he should not be disturbed in his difficult task, hit upon an expedient. He proposed to pay the annuities without submitting the accords to the Chamber. This resolve was held to be illegal as well as evasive by the Socialist deputy, M. Vincent Auriol. He tabled a motion which would have involved the discussion of the entire question of inter-allied debts. M. Poincaré opposed such discussion. He asked for a definite substantial vote. Abstainers would be considered to be voting against his Government, and if he did not obtain a clear majority he would resign. M. Auriol argued that the making of payments equalling the annuities provided for in the debt settlements implied the legitimacy of the debts, and he contended that no provisional payments should be sanctioned pending Parliamentary ratification of the agreements. M. Poincaré recalled that provisional payments had already been decided upon by M. Raoul Péret when he was Minister of Finance. They were not then challenged. He easily carried his point.

At the same time, M. Poincaré provided for the conversion of Treasury bonds maturing in 1929 into 6 per cent. bonds maturing in fifty years. Other operations of a similar character, absorbing

part of the floating debt, were decided upon and successfully carried out. It may be well to give here a brief review, obtained from official sources, of the situation in July, a year after M. Poincaré had taken office. In July of 1926 the paper franc hovered between 240 and 250 to the pound sterling. To all intents and purposes it was stabilised in July, 1927, at 124. There were technical reasons why it should not be legally stabilised until the experiment had been prolonged-and, it must be admitted, there were also political reasons. In 1926 the fiduciary issue of the Banque de France had been increased by 17,000,000,000 paper francs. In the coffers of the Treasury was a sum equivalent only to 300,000l. There was a run on the Treasury, and France stood on the brink of bankruptcy. M. Poincaré immediately caused to be voted heavy extra taxation, and removed the charge of the short-term debt from the Government to a special body, which was solemnly given Constitutional guarantees in a National Assembly at Versailles. Then M. Poincaré began to repay advances of the Banque de France and arranged for the methodical obliteration of the Treasury debt. The Treasury was provided with ample funds, and M. Poincaré piled up vast quantities of reserves in gold currencies. The Banque also bought gold until it had larger stocks than any other institution outside America. The only short-term Treasury bonds issued were for two years formerly there had been one-month, three-month, and six-month Treasury bonds-and yet more money was offered at 5 per cent. to the Treasury than at any time within the past few years.

In May began the series of trans-Atlantic flights. On the 8th two French airmen, Nungesser and Coli, set off from Le Bourget in the "Oiseau Blanc." There were contradictory reports, but never again was there authentic news of these daring pioneers. The French were greatly disappointed and grieved. It was known that the Americans were preparing flights from the United States to France and it was held by some experts that the eastward flight was perhaps better favoured by the prevailing winds than the westward flight. Foolish reports were sent to America pleading for the postponement of all attempts until French chagrin had disappeared. Captain-afterwards Colonel-Charles A. Lindbergh ignored these warnings and, forestalling his rivals, who had been preparing in the full blaze of publicity to cross the Atlantic by air, he set off unheralded, without notice, in his "Spirit of Saint Louis," and after a solitary thirty-three-hour journey over the ocean, arrived safely at his destination, Le Bourget, 3,600 miles away from his starting-point at Roosevelt Field, near New York, on Saturday evening, May 21. Lindbergh's performance was extraordinarily spectacular, and the quiet demeanour of the flier won the hearts of the French. From the moment of his arrival to his departure he was the hero of a