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view to making the system more efficient. The agreement then reached was embodied in a Protocol. The discussion assumed the continuance of the Condominium. The principle of joint control was reaffirmed. The object was to mend, not to remould, to amplify the provisions of the Convention and to remove defects in the light of the experience gained since 1907. The British delegation argued that the best course would be to increase the scope and powers of the joint authority and correspondingly to limit those of the national administrations. The French, on the other hand, attached great importance to the retention by each Power unimpaired of the sovereignty over its own nationals expressly recognised by Article I. of the Convention of 1906. The Protocol rectified several anomalies and tightened up the laws relating to the liquor traffic and recruiting, but it was not ratified until 1922. Since ratification the provisions under British control have been enforced, but there has been considerable delay on the French side. Indeed, it is not clear that they are in operation yet.

When the Peace Conference was sitting at Versailles the question was asked in the House of Commons whether, in view of the unsatisfactory working of the Anglo-French Condominium in the New Hebrides and of the fact that the commercial and agricultural future of the group chiefly depended on the Commonwealth of Australia, steps would be taken to terminate the Condominium and bring the group entirely under the British flag either by direct agreement with France or by submission to the decision of the Peace Conference.' The Parliamentary UnderSecretary for Foreign Affairs replied that the matter had been referred to the British Government's representatives at the Conference.' The announcement aroused great anticipations in the group. But the Conference, or His Majesty's representatives thereat, had other things to engage their attention. At any rate, no more was heard on the subject. Again the Condominium was among the secondary questions with which the Empire Premiers Conference of 1921 was expected to deal. But it appears to have been shelved.

In 1921 the Société Française des Nouvelles Hébrides offered to sell its property and rights in the group to the Commonwealth Government for the sum of 500,000l. Nothing came of the proposal. Subsequently it was renewed, the purchase price being reduced to 200,000l.: again it was declined. Various reasons prompted the refusal. The Society, admittedly, could only show a clear title to about two-thirds of the land under offer, and it was by no means certain that this estimate did not err on the side of optimism. The great discrepancy between the two prices named was not reassuring. Again, while the transfer would have

enlarged Australian interests in the group, and would in so far have strengthened the Australian case for a modification of the régime in force, it would not in any way have affected the Condominium itself. Dual control, with its attendant evils, would have continued. The position of the Commonwealth Government would have been simply that of any trading corporation. Finally, the Commonwealth still had its hands full with the plantations expropriated from their German owners in the Mandated Territory of New Guinea, and had no wish to embark upon further ventures of that sort.

There for the present the matter rests. The Condominium, for which no one has a good word, remains. English and French observers alike testify to its many shortcomings. In his L'Océanie Française, published a few years ago, M. Jacques Feillet described it as 'un système arbitraire, condamné par l'expérience qui en a été faite depuis 1907, qui ne peut qu'amener d'inutiles frictions entre nous et nos voisins, amis et alliés.'

As for the future of the group, we must assume that claims founded on discovery and the like were waived or compromised by the Convention of 1906. Any readjustment must proceed from the starting-point that either nation has rights which should be recognised. It is undeniable that the French interests in the New Hebrides are the more extensive. Seventy-five per cent. of the white population, of the trade, and of the land acquired from the natives are French. France, moreover, argues that the group is an annexe to New Caledonia. British interests, however, cannot be overlooked. British capital and enterprise have done much to develop the islands. British missions, with their Australian offshoots, have a fine record of service there, and naturally enough desire to continue their labours under the British flag. Indeed, they fear that if Britain left the group they might expect rather unsympathetic treatment from the French authorities. Australia's interests also are by no means negligible. Australian trade with the New Hebrides is of a substantial value. The Commonwealth Government subsidises a shipping service to the islands, and there is a colony of Australian settlers, for whose benefit a legal officer is maintained at Vila by the Commonwealth. Moreover, Australia has especial reasons for wishing that the New Hebrides be not permitted to pass out of the Empire. The argument of her commercial and financial connections in the group is reinforced by considerations of defence. The New Hebrides are, geographically speaking, at her very doors. They are less distant from Sydney than is Rabaul. They have for Australia a strategical importance which they do not possess for France, an importance greatly increased by the events of the last few years, in consequence of which, as we are often told, the strategical centre of gravity has

shifted to the Pacific. They are, in fact, a frontier, and on that account Australia is the more anxious that they should remain in British hands.

Thus, while all agree that joint control has been a failure and should be jettisoned, either nation has claims which cannot be dismissed. What is the solution? Three alternatives have been suggested the cession of the group to France in return for a quid pro quo, cession to Britain in return for a quid pro quo, and partition. The first course would obviously commend itself to France. Quite conceivably many of the British in the group would not object to it. The French, indeed, assert that a majority of the British would welcome annexation to France. If the contention is correct, it is presumably because they would enjoy greater latitude under French rule. But this solution would be worse than none at all from the Australian point of view, and there is no evidence that France is prepared to provide the consideration for such a transaction, whether in cash or kind.

The second alternative would, in the opinion of many Australians, be the ideal one. It should be clearly understood that they cherish no ambition whatever to be invested with control of the New Hebrides. As it is, the Commonwealth has in the development of Papua and in the Mandated Territory of New Guinea, to say nothing of the Northern Territory and tropical Australia, a task which will absorb the whole of her energies for years to come. Her 'colonial' responsibilities are already great; she has no desire to add to them. But many Australians hope, rather vainly perhaps, that some day Britain will acquire France's rights in the group either by purchase or in exchange for equivalent territory elsewhere. But, even were France to agree to withdraw upon terms, the assumption that Britain should foot the bill is a little naïf. After all, the New Hebrides are a long way from Britain. Any advantage that would accrue from the transference would fall to Australia rather than to Britain. Yet Australia has given no indication that she is willing to bear any part of the burden entailed in an arrangement from which she would derive the exclusive benefit.

On the face of it, partition would seem to be the most natural and satisfactory expedient of the three, and has many advocates among the British element. However, there are certain practical difficulties in the way. British and French interests are interspersed throughout the group. Any division would leave subjects of one country under the flag of the other. Moreover, the close proximity of the islands might cause trouble. Should one of the Governments, for example, permit or close its eyes to the liquor traffic within its jurisdiction, it would not be easy to prevent liquor from being smuggled into the territory of the other. And the French

appear to be resolutely opposed to partition. When the late Mr. W. F. Massey, formerly Prime Minister of New Zealand, attended the Imperial Conference of 1923 he made it his business while in France to sound French opinion on the subject. Everyone he questioned, officials, politicians, journalists, all and sundry, made the same reply. France, he was told, will not give up a single inch of the islands, whether by way of sale, exchange, or partition. Mr. Massey also said that he had reason to believe that the British authorities were thoroughly tired of the Condominium, and that if they had consulted their own inclinations they would long since have said to France, 'Take the group and have done with it.'

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So the prospect of any modification of the existing arrangement seems rather remote. Yet the various Australian interests which consider a change to be imperative have not abandoned hope. The Condominium has not worked, they maintain, and is from its nature incapable of working. What cannot be mended ought to be ended. As one who speaks with peculiar authority has written, One thing is certain, and that is that matters cannot remain in the unsatisfactory condition in which they are. Dual control is a poor makeshift of government, especially when each party is straining to keep its own flag uppermost. There is no possible cohesion in the particles, and the sooner a way out of the chaos is found the better for all concerned, both Europeans and natives.' And should the New Hebrides ever again become the subject of discussion between the Governments of Britain and France, Australians confidently believe that they will be allowed to have a voice in the proceedings.

M. L. MACCALLUM.

THE GOLD STANDARD: A REJOINDER

THE recent announcement by the Government of its intention of displacing the Treasury notes by those of the Bank of England brings us to the final stage in the retrograde movement which was started in 1920 under the Coalition Government with the advice of the Treasury officials and of the Cunliffe Currency Committee. These five years constitute the most disastrous period in the history of British industry, during which the country has suffered the heaviest losses ever recorded.

The absence of all opposition, and even of criticism, to this latest act of the Government in deliberately placing the country under the heel of the Bank of England is an illustration of the appalling ignorance and general apathy of the public, and especially of our industrial classes, who are the greatest sufferers. From the day the Armistice was declared until now those who have had control of the financial affairs of this country as its official representatives, have never ceased their efforts on behalf of the interests of the money-lending classes against those of the British public.

Few people appear to have given the Treasury note system the consideration that it deserves, otherwise the proposal to abandon it for a far inferior token would have aroused the most strenuous opposition.

For the benefit of those who are really interested in this vital problem of the currency, which affects our very existence as an industrial Power, it will be well to outline what this proposed change over from the credit of the nation to that of a private trading company really involves.

One of the most important effects which will be felt throughout the country by reason of this change of the note issue will be a further depression in our home trade. Those who imagine that we have reached bottom and are at the end of the deflation process will be seriously disappointed. The mere passage of the Gold Standard Bill, for which Mr. Winston Churchill is responsible, has not yet placed this country on the gold basis.

So long as we have a large volume of notes in circulation which are unrepresented by gold, we are using, and to this extent, what

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