Dawn Cabinet

Out of fiscal panic and crushing political crisis France once again emerged last week with her money sound and her democracy intact.

Money is sound when you can take it to the bank, get gold for it and do as you please with the gold. This test the Bank of France met stubbornly, day after day, with long lines of people applying for the minimum-sized French gold bars worth $12,000 each, receiving these over the counter in a steady yellow stream, tucking them into satchels and quietly dispersing. Not rich folk, most of the French gold buyers were humble but trusted representatives of town and village groups or syndicates who felt that temporarily their money would be safest in gold, knew their rights. Since the village innkeeper in France is usually a person of respect and trust, many an innkeeper was in Paris last week buying gold for thrifty peasants who are far from being hicks. Over the panic period stanchly faced by France, her Bank, with So billion francs in gold on hand last month, paid out nearly eleven billion before confidence was presently restored last week and the gold flow was checked.

Democracy is intact when parliament, no matter how great the panic, refuses to grant unlimited powers to the Executive. This test the Deputies and Senators of France met by defying every Premier or would-be Premier who insisted on "full powers" during the crisis (TIME, June 3, 10). They settled down only when a peasant-born statesman of sturdy fibre asked them last week to support him as Premier by granting his Cabinet not "full powers" but carefully restricted extraordinary power for stated and specific purposes. Even this the Chamber voted with extreme reluctance, so ingrained is French dislike for any executive remotely dictatorial. There was not a single cheer, but thoughtful silence when M. Pierre Laval, the earthy and black-nostriled disciple of Peace-Maker Aristide Briand, arose last week to offer France a Cabinet of his choosing which soon received the Chamber's vote of confidence 324 to 160 with 100 abstentions.

Shrewd Laval. That France, after two years of Adolf Hitler's blustering at the rate, should still want a disciple of M. Briand for Premier, revealed again the peace depths in French hearts. Pierre Laval loomed last week as the right Premier to save the franc and France because he has built himself up in the eyes of all Frenchmen by ceaseless peace efforts as French Foreign Minister. These climaxed in the Stresa Pact and his visit to Moscow (TIME, May 27). M. Laval's manner of achieving power as Premier, for the third time, all French politicians agreed last week, was characteristically peasant-shrewd.

Swarthy M. Laval with his white string tie* had seemed the logical choice when his tall chief, Pierre Etienne Flandin, was overthrown after asking the restive Chamber for "full powers" in a speech decidedly too long and probably too emotional (TIME, June 10). Summoned by President Lebrun, M. Laval refused to try to form a Cabinet, bided his time. He figured cannily that the Chamber and would-be Premiers who asked for "full powers" would wear each other out. This Laval guess was correct. In a furious three-day wrangle the Deputies rejected every likely statesman who attempted to dominate it, as it had rejected its own President (Speaker) Fernand Bouisson. When President Lebrun finally had to send for Pierre Laval again, that Senator was daisy-fresh and ready to work all night whipping a Cabinet together while everyone else was dead beat, exhausted, pliant.

"Government of Action." It was pitch dark (3:10 a. m.) when M. Laval's white tie entered the President's Palace as the pale oriflamme of this new Cabinet: Premier & Foreign Minister: Pierre Laval, Independent.

Ministers of State: Former Premiers Flandin of the moderate Right and Herriot of the moderate Left; M. Louis Marin of the Right.

Minister of Finance: Senator Marcel Regnier of the moderate Left, Budget Reporter since 1933 and a great croaker for economy but not considered to have a topnotch fiscal brain.

Minister of Interior: Deputy Joseph Paganon, moderate Left.

Justice: Senator Leon Berard, moderate Right.

War: Colonel Jean Fabry, Right. Navy: Deputy Franc,ois Pietri, the last to try to form a Cabinet last week before M. Laval was called.

Air: General Victor Denain, non-Parliamentarian.

Colonies: Deputy Louis Rollin, Right. Public Works: Deputy Laurent Eynac, moderate Left.

Pensions: Deputy Henri Maupoil, a moderate Left war veteran chosen by Premier Laval at the imperative demand of French war veterans who waited upon him in delegations, successfully demanded that veterans' pensions be administered by a veteran.

With the day just breaking, the "Dawn Cabinet," as Paris christened it, trooped from the Elysee Palace and Premier Laval snappily observed to the dog-tired Press: "I have formed a Government of action. I did my duty in forming a Cabinet and I hope the Nation and Parliament will do their duty in supporting me."

Giving tired politicos scant rest, Premier Laval forced them to work with him all day, drafting an emergency-powers law much more limited in scope than had previously been asked. Partial victory came when the Chamber Finance Committee approved the text. Then Premier Laval went straight to the Chamber at 6 p. m., paid no heed to his frigid reception without cheers, asked the suspicious Deputies to approve a bill of one single article reading thus:

Article One: With a view to avoiding devaluation of the franc, the Senate and Chamber authorize the Government to take by decree until Oct. 31, all measures having the force of law to fight speculation and defend the franc.

These decrees, approved by the Cabinet, will be submitted for ratification before Jan. 1, 1936.

Earnestly the new Premier pledged: "The powers that we ask of you respect the organic statutes and the policy of the country! . . . Show your determination to respect the signature of the State and maintain the integrity of our money!"

Rousingly Chamber and Senate answered with smash votes of confidence 324-160 and 233-15 respectively. On international exchange the franc rose as the pound, dollar, fell, carrying up with it the Swiss franc, guilder and lira. Displeased were French Communists and extreme Socialists, their spleeny spokesman being Pinko Deputy Leon LaGrange who had declared in debate, "The 200 families who rule this country are opposing the National will!" These villains, Deputy La-Grange said, are headed by "the regents of the Bank of France, de Rothschild and de Wendel!" In French villages sage peasants with gold in their mattresses laughed at the Pinks.

In Paris first-class fiscal minds saw no humorous side. The decision of Parliament last week was for deflation, sound money--and to achieve these in rock-ribbed surety Premier Laval must subject France to a terrific test of budget paring, drastic economy and supreme reliance on the ultimate ability of the Capitalist system under democracy to bring back not boom prosperity--France has never had that--but tolerable times. The budgetary deficit stood at at least 10 billion francs or $660,000,000. Under the new emergency-powers law Premier Laval, assuming that Parliament shortly adjourns for the summer as it was expected to do last week, has four and a half months in which to exercise a fiscal free hand. His best friends dared not predict, could only wish him luck.

*When Nazi newsorgans make their "pure race" point about the French being a "Negroid people" they commonly print a picture of M. Laval whose dead white tie makes his face appear by contrast even swarthier than it is.

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