Political Courage

Through two empires, four republics, three major wars in 70 years and 14 postwar cabinets, the French have sat in suspicious judgment on their governments. Frequently they have shown their approval or disapproval not only by their ballots but by the way they behave when their government asks for money. They have become Europe's greatest gold hoarders. Since World War II, weak French governments have flooded the Fourth Republic with fancy-looking banknotes which the public no longer trusts, and which steadily lose value. Result: an estimated $4 billion worth of gold has disappeared from circulation, mostly into the stockings of wary French peasants.

To coax this gold out of hiding, Premier Antoine Pinay launched a savings-bond drive. He gave the French a choice between buying his gold-backed bonds or paying increased taxes (TIME, April 21). Last week the bond drive was over, and Pinay pronounced it a "healthy operation." French hoarders turned in 34 tons of gold, valued at $42 million. In all, $557 million came from what the government calls "fresh money," i.e., cash and gold not previously invested in bonds.

The final $666 million came from investors cannily reconverting other bonds to the new Pinay bonds, which are not only gold-backed but in some cases pay higher interest. The drive was a measured success for France's commonsensible Premier: though France is not yet out of the woods, it seems to be on the right path.

Pinay, in his own quiet way, went on proving that France's confidence is well placed. Last week, when France's No. 1 political pressure group, the peasant-farmer bloc, demanded an increase in the price of wheat, he bravely said no. If bread prices rise, he argued, the whole delicate mechanism controlling the cost of living will break down. Price hikes mean wage boosts, and France can afford neither. It was the first time since World War II that a French Premier has faced down the farmers--a rare act of political courage.

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