per cwt. for his crop in Group II. (retention in kind under 5 per cent.), with some prospective advantage to himself out of the net proceeds of the currants retained; and lastly, that he realised 11s. 5d. per cwt. for his crops in Group III. (15 per cent. retention), also with a prospective advantage out of the net proceeds of the 37,500 tons retained. To arrive at the net price realised by the growers collectively, I have not taken into consideration the price at which they themselves may have sold to exporters or speculators. My calculations are based, firstly, as to the quantity 'exported, upon the price which the exporters collectively realised by the sale of the fruit abroad; and secondly, as to the quantity used in Greece, upon the price paid by the manufacturers. This manner of arriving at the average price cannot pretend to absolute accuracy, but it is the best available, and, being the same for all three groups, it is perfectly safe as a basis for comparison. It should be stated here that the growers received this average price on their whole crop, including, that is to say, the quantity retained, with which they have absolutely nothing to do, since it is the exporter who buys the fruit in the open market and delivers it to the retention stores, adding the outlay to the cost of the exported goods. It should also be noted that the smallest crop (1897) brought to the growers the most satisfactory return. It might be supposed that the difference between the 3s. 8d. for the 1894 and the 14s. 2ąd. for the 1897 crops came out of the consumer's pocket. As a matter of fact the consumer paid in 1897 no more or very little more for his currants than he paid in 1894. The extraordinary low prices in 1893-5 were considered by the distributors as quite abnormal, and, therefore, of short duration, and neither the wholesale dealer, nor the retailer reduced their selling price to a corresponding degree. The immense difference during the low-priced seasons went to swell the profits of the middlemen, of whom the retailer had the lion's share, rather than to reduce the consumer's currant bill.

It is estimated that by the end of the currant season the special fund established by the Retention Act will have available a sum of about £150,000. This amount represents the surplus paid into the fund out of the proceeds of the retained currants, after the payment of all expenses and the refunding to the Exchequer of the Land Tax abatement of four drachmae per thousand pounds, on all the currants exported since the Act came into force. It should be observed that the currants retained and sold for use in Greece for industrial purposes, though of the commonest quality, realised on the average a little over 2s. 9d. per cwt. This is just 1s. per cwt. less than the average price realised for all the qualities of the crops in Group I., and 1s. 3d. more than the lowest open market price during those two seasons. It is beyond doubt that a much higher price can be obtained for these currants, if the Legislature would place the retention authorities in a position to sell a given quantity at a fixed price for a series of years. In fact, many good offers have already been

made on this condition, one important firm alone offering to contract at nearly double the price realised, for twenty thousand tons each year. The Retention Act has created a most promising industry. Numerous distilleries have sprung up all over the country, using only currants as raw material, and producing the finest alcohol in the world. Those competent to judge affirm that the eau de vie de vin obtained from currants cannot be surpassed by the finest cognac that France can produce. When this offshoot of the currant industry has had time to develop, it bids fair to contribute to the national wealth as much perhaps as the parent industry itself.

The remarkable results enumerated above speak for themselves, and need no comment. Incalculable, however, as have been the benefits to the growers from the Retention Act, they would have been greater still, had its operation not been handicapped all along by the many defects of the measure and its crude and unworkable provisions. The Bill had been drafted and proposed by its author, and it was passed by the Chamber with the certainty of its failure, and as a sop to a popular demand which it was considered dangerous to resist. No care, therefore, was bestowed upon the structure of the Act, and its working suffers, to the present day, from the sins of its inception. The defects of the Act, and especially its provisional character and the arbitrary fixation of the percentage retainable at 15 per cent., irrespective of the relations between supply and demand, have been constantly assailed by all those who are competent to express an opinion. They have been likewise condemned by both the Currant Growers' Congresses held at Patras in 1896 and 1898. It is now agreed, almost on all hands, that what is required is a law running on parallel lines with the Bill drafted by me in 1893, at the request of the late Mr. Tricoupis, and recommended to the Chamber, in February, 1894, by the Currant Growers' Union. The main provisions of this Bill were: (1) A fixed retention of 3 per cent., whatever be the extent of the crop, with the object of improving the quality by a more careful sifting and cleaning of the fruit. Refuse currants, clean and free from foreign substances, to be accepted as good delivery to the retention stores. (2) A further retention equal to the surplus of the estimated supply over the estimated requirements of the world. The visible stocks at home and abroad, on the 31st of July, with the estimates of the coming crop, to be taken as the estimated supply; and the universal consumption of the preceding twelve months, plus 5 per cent., to meet a probable increase, to be taken as the estimated requirements. The figures to be finally fixed by a representative committee, on the 21st August, on data collected by the Government. (3) The administration of the Act to be placed in the hands of a Currant Bank to be forthwith established. The money already available, together with the proceeds of the retained currants still unsold, to form the nucleus of the bank's capital, which shall go on increasing by the addition of the proceeds of the currants retained in the ensuing years. No. 36.-VOL. IX

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All currant growers to be shareholders of the bank in proportion to the areas which they cultivate. The bank to lend to its shareholders at moderate interest, on the security of their growing crops, small sums of money, for purposes of cultivation, repayable in October.

The original Bill, as introduced to the Chamber in 1894, provided also that a minimum and maximum lowest price should be fixed for the commonest quality, which governs all others, in order that production and consumption should be unable at any time to oppress one another. This can be secured by the retention authorities being empowered to sell in the open market, out of the retained currants, whenever the lowest price rises to over the maximum fixed; and to buy in the open market, with retention money, whenever the lowest price falls to under the minimum. The minimum was fixed by the Bill at 120 drachmae per 1,000 pounds, this being considered to be the average cost of production, while the maximum was fixed at 200 drachmae, equal to about 15s. per cwt., free on board Greece. The margin between the two limits was considered sufficiently wide for the exercise of commercial enterprise, in an article enjoying natural monopoly. This provision has not so far met with approval, nor is it very popular with the growers, who are naturally desirous of being left free to exact as much as they can out of the consumer. I consider, however, this provision a necessary corollary to a State regulated monopoly, and the artificial restriction of supply, which might conceivably, say, on a a sudden demand from an unexpected quarter, place the consumer at the mercy of the producer.

The new Chamber, which meets in a few weeks, will, it is to be hoped, deal with the question in a broader and more statesmanlike manner than the last; and that, in any case, it will put an end to the provisional character of the measure, and leave the fixation of the percentage of retention to be determined at the proper time, in relation to the estimated surplus of the supply over the estimated demand.

THEODORE A. BURLUMI

P.S. Since this article was written the Greek Government introduced to the Chamber of Deputies a Bill based entirely on the lines. indicated above. This Bill became law in July last and it is now in operation. The three main provisions of my own Bill have been adopted. The Act is to be in force for ten years. The minimum percentage fixed by the Act is 10 per cent. on the quantity exported. A committee representing the currant growing districts shall be called together in August, in each year, to advise as to whether the minimum. should be increased, the ultimate decision resting with the Cabinet. In no case, however, can the percentage of retention exceed 20 per cent. This limit I consider to be the greatest blot of the Act. It is entirely opposed to its spirit, for in the event of an abundant crop the maximum percentage may prove sufficient to attain its principal object. The Government and Parliament, though accepting unreservedly the principle of the retention of the surplus, proceeded to

its application with halting steps and failed to carry it to its natural conclusion. I have little doubt that before long the maximum of 20 per cent. will have to go by the board.

T. A. B.

LETTER FROM JAPAN (continued from No. 35).

HII. POLITICS AND FINANCE.

THE year 1897 began without any great political excitement except the gold standard question. In May, the Government succeeded in selling 43,000,000 yen of war loan bonds to a London firm, thus paving the way for foreign investment in our negotiable instruments. This gave some consolation, and served as a stimulus to those who were in want of capital. But in the political world there was steadily upheaving a disruption between the followers of Count Matsukata (the Premier) and the progressive party led by Count Okuma (the Minister of Foreign Affairs). The latter resigned in November, and it was the intention of Count Matsukata to augment the revenue by about 25,000,000 yen by the increase of the rate of the land tax by 1 per cent., and of that on sake by 3 yen per koku. When the Parliament assembled in December, the liberal, progressive, and national parties, into which the House is divided, all united in bringing forward a vote of want of confidence in His Majesty's Government. On Christmas day the Parliament was dissolved, and until January of the following year the country was without a Cabinet. On the 12th of that month Marquis Ito kissed the hand of His Majesty as Premier, and Count Inouye as the Minister of Finance. The liberal party seemed to have made some proposals to the new Cabinet. Failing in this, their attitude became gradually unfavourable towards the Government.

Meanwhile the Finance Minister did much in alleviating the condition of general economy, and exerted all his influence in suppressing the sudden expansion of expenditure, especially that on the Army and Navy. His success in this as well as in getting the remnant of the Chinese indemnity to be paid up all at once in May must not be overlooked. That month saw the opening of the Parliament, which was by no means peaceable, as the spirit of opposition was daily gaining strength. The most important questions were the increase of the land. tax and the extension of the franchise, which involved the increase of members for boroughs and the abolition of the registration of names of the voters by ballot. These two were not distinct but in fact had one common object, because by the reform the predominance of the agricultural interest in the House will be weakened, thereby affording facility for the passing of the land tax bill. But more from political considerations the land tax bill was negatived on the 12th of June, followed by an Imperial order for dissolution. The country had

to pass a most dangerous strait. There were on one side opposition parties urging the necessity of forming a pure party government, and on the other extreme conservative views were entertained. Standing couragously between these two extremes, Marquis Ito steered the ship of the nation safely and wisely. He resigned on the 26th, and advised His Majesty to summon the leaders of two great parties, liberals and progressives, which formed an overwhelming majority and which were already united as a constitutional party. Such a union would have been impossible if the Government had not been deemed a common foe.

Count Okuma occupied the post of the Premier, and Count Itagaki, the leader of the liberals, that of Minister of Home Affairs. The coalition Ministry undertook first of all to carry out a thorough reform in administrative organisation. In this it succeeded, though not to the full extent; but in general affairs of the State many hitches prevailed on account of the interest of the two parties coming constantly into conflict. The resignation of one of the ministers kindled the fire of the strife, each party being desirous to fill the vacancy with its own man. On the nomination of the minister from the progressive side, all ministers of the liberal side tendered their resignation, leading to the total collaspse on the 31st of November. The budget was already compiled and was about to be presented to the Parliament, and the noteworthy point in it consisted in avoiding the increase of the land tax, but resorting to the increase of that on sake, the raising of the selling price of leaf tobacco and the imposition of tax on sugar. In fact, the coalition Government laid chief stress on the taxation of commodities, though it relied partly on the increase of income tax and registration tax, as well as the new imposition of tax on the notes of the Bank of Japan issued on documentary reserve. Nor was this all. The former Ministry hastened the total abolition of export duties and other taxes which were unproductive or otherwise obnoxious. Also it was contemplated to remodel the national debt act. These schemes underwent great changes by the fall of the coalition Ministry.

The present Cabinet was installed on the 8th of November, with Marshal Yamagata as the Premier and Count Matsukata as the Finance Minister. The foremost question was how to get the majority of the House on the Government side. At last the cabinet joined hands with the liberal and national party, which with few independents far outnumbered the progressives. With this encouragement, the bill to raise the land tax to 4 per cent.1 was presented to the House, which was thrown into a state of excitement and confusion. The agricultural interest was in jeopardy, while the commercial men and manufacturers united in endorsing the policy of the Government. But the prospect seemed very gloomy. In order to save the bill a great compromise was

1 The existing rate is 24 per cent. of the value of land. At the same time price of land was to be revalued in those districts where the valuation for the purpose of revenue was too high. In this way the State loses annually about 3,730,000 yen.