Page:Stabilizing the dollar, Fisher, 1920.djvu/170

116 after that date. The salaried man and wage earner would have had their salaries and wages definitely docked by the law so that the wage earner of 1919 would get only three fourths of what he got in 1913.

Such a whimsical use of an index number to defraud would of course not be tolerated for an instant. The conservative would be furious, the radical still more so; only the latter would not be devoting his efforts to sabotage, price fixing, restricting cold storage, etc. Every one would unite to stop such use of an index number to destabilize a stable standard.

Yet precisely the same reasons in precisely the same degree now justify the use of an index number to stabilize an unstable standard!

10. Precedents

Even before index numbers were dreamed of, some contracting parties have, at times when the instability of monetary units became especially intolerable, sought some partial escape. A number of instances of this sort are given in Appendix V. These include contracts in terms of foreign coin, or in terms of grain, or iron, or in terms of composites of goods. The last named includes the recent adoption by many firms and official bodies of a supplement or correction to ordinary money wages by means of an index number of the cost of living.

11. What Might Have Been

Let us stop to think what would have happened if, when resuming specie payments in 1879 (to go no further back), we and other countries had applied these principles and really standardized monetary units.