But, surely, to pay off war debt with a huge addition to currency, making war's inflation many times worse, would be a disastrous beginning to that new era which is alleged to be dawning. By hard work, sparing consumption of luxuries, and a big industrial output, we can soon make the debt charge look smaller and smaller as compared with our aggregate income. Our foreign debt we can only meet by shipping goods and rendering services. But since it was all raised to be lent to our Allies and our lending of it was essential to a victory which has rid mankind of a terrible menace, it is surely reasonable that our creditors should not press for repayment in the first few difficult years, but should fund our short-dated debts into loans with twenty-five or thirty years to run. As to the home debt, we can only lighten its burden on the taxpayer by making taxation equitable. To this end reform of the income tax is an urgent need. We have to lighten its pressure much more effectively on those who are bringing up families, and by collecting it through employers make it an effective and just tax on those of the working class whose earnings and family liabilities make them fairly subject to it. XVIII THE REGULATION OF THE CURRENCY _February_, 1919 Macaulay on Depreciated Currency--Its Evils To-day--The Plight of the Rentier--Mr Goodenough's Suggestion--Sir Edward Holden's Criticisms of the Currency Committee--His Scheme of Reform--Two Departments or One in the Bank of England?--Not a Vital Question--The Ratio of Notes to Gold--Objections to a Hard-and-fast Ratio--The Limit on Note Issues--The Federal Reserve Act and American Optimism--Currency and Commercial Paper--A Central Gold Reserve with Central Control.