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Royall Tyler to Mildred Barnes Bliss, September 26, 1931


I can’t let today’s air post go without sending you a line, dearest Mildred—though what my news will look like by the time this gets you, the Lord knows.

Perhaps you got a letter from me which I wrote from Brassó (Kronstadt) on Aug. 30?See letter of August 31, 1931. After that I had to spend a further week, very trying but successful, in Bucharest. Then to Budapest for 2 days, then to Ravenna to meet Hayford and check up on Part I of Ricci’s monumental work on restorations of the Ravenna mosaicsCorrado Ricci, Alessandro Azzaroni, and Giuseppe Zampiga, Monumenti: Tavole storiche dei musaic [sic] di Ravenna, vol. 1 (Rome: Istituto Poligrafico dello Statto, 1930).—I’m sorry to say it is scamped and untrustworthy. RicciCorrado Ricci (1858–1934), an Italian archaeologist and art historian. himself doesn’t know the whole story, by any means. Then Antigny, where I had hoped for a fortnight on the book, but whence I was summoned after 3 days to London, in order that I might mug up a case and rush to Berlin. Hardly had I got to London than they telephoned from Geneva, where Hungary had just appealed to the LeagueThe League of Nations, an international organization in Geneva whose principal missions were to maintain world peace, settle international disputes through negotiation and arbitration, and create stability within financial markets. for help,In addition to a budget deficit of $24,000,000, the Hungarian government had spent an additional $90,000,000 outside the budget, using the remainder of the 1925 League of Nations loan that had not been spent due to the budget surpluses achieved from the reorganization of Hungarian finances by Jeremiah Smith and Royall Tyler. See “Hungary Discovers Unexpected Debts; Expenditures of $90,000,000 Outside the Budget are Found,” New York Times, September 26, 1931; and letter of April 15, 1925. begging me to go there. HambrosHambros Bank, a British bank based in London. The Hambros Bank specialized in Anglo-Scandinavian business, with expertise in trade finance and investment banking, and was the sole banker to the Scandinavian kingdoms for many years. The bank was sold in 1998. were very nice about it, told me that they would refuse if I asked them to, but that the Bk. of England had appealed to them not to resist, and that they were prepared to give me leave of absence for a mission to Hungary. I felt I couldn’t do anything but accept, so off I went to Geneva, and was immediately signed up to proceed shortly to Bpest as Member of a Delegation of the Fin. Ctee.On October 25, 1920, the League of Nations had appointed an Advisory Economic and Financial Committee composed of two sections of ten members each and tasked with “the working out of measures of an economic and financial nature which have been submitted for adoption by Members of the League in accordance with the Covenant of the League.” of the League—other members being Ch. Rist,Charles Rist (1874–1955), a Swiss-born French enconomist. Pospisil (Gov. of the Czecho Nat. Bank),Vilem Pospisil (1873–1942), a Czechoslovakian jurist, financier, and governor of the Czechoslovakian National Bank (1926–1934). Suvich (Ital., Chairman of the Fin. Ctee.)Fulvio Suvich (1887–1980), an Italian politician and diplomat, was undersecretary of state for Finance in 1926–1932. and an Englishman,Henry James Bruce (1880–1951), a British diplomat and author. not yet designated.

That was last Sat. On Sun. afternoon, as I was talking with Salter, the telephone rang and he was given the news that sterling had been cut loose from gold.The fall of the pound sterling from the gold standard occurred on September 21, 1931. See “$37,000,000 in Gold is Earmarked Here; Total Segregated for Foreign Account Since Sterling’s Fall Now $251,086,000,” New York Times, September 30, 1931. Since then, you may imagine what life has been. I had to return to Paris. Elisina came up from Antigny to see me for 2 days, and just as she was to have started to return, had a spasme artériel“Arterial spasm.” which produced symptoms that admirably imitated those of a real stroke. No servants in the house—etc etc. However, I got a doctor and a nurse, and Elisina came round wonderfully, and is returning to Antigny today. But I’m not happy about her; she’s been steadily doing more than she should.

And I’ve got to leave for Bpest—address Hotel Hungaria—next Tues. Sept. 29. As a member of the League Delegation to start with, but with the prospect of having to stay on as Adviser,Royall Tyler was appointed financial adviser of the League of Nations to the Hungarian government, Budapest (Représentant du comité financier à Budapest) in October 1931. In 1944, Tyler authored an account of reconstruction schemes for the League of Nations: The League of Nations Reconstruction Schemes in the Inter-War Period (Geneva: League of Nations, 1945). In this book, Tyler wrote: “The Financial Committee visited Budapest in October 1931, and having examined the situation on the spot, prepared a report to the Council, in which was reproduced a declaration by the Hungarian Government constituting a programme. This declaration provided for the appointment of a Representative of the Financial Committee and an Adviser to the National Bank, both to reside in Budapest, these offices to be continued until the Council had found that financial stability had been restored. The Representative was Mr. Royall Tyler (United States), who had been Deputy-Commissioner under Mr. Jeremiah Smith and had acted as the Trustees’ Agent after Mr. Smith’s release. The Bank Advisor was Mr. Henry J. Bruce (Great Britain).” (62) in a particularly difficult position. What can be made out of it, I don’t know, but I felt I couldn’t refuse to go. In 1924, when Jeremiah Smith and I went there, British credit was still there, ready to help, and it did help. America was in a lending mood. Today—.

I can’t understand the course of events in England, let alone trying to foresee what is going to follow. I have the feeling that I have been sold off to try to hold a difficult situation, and that it is up to me to do my best there, and to keep my head, if I can. But it is impossible to keep one’s mind off the major events, and the only moments of anything like peace are those which I can—and must—snatch to put the finishing touches to our Vol. I on Byz. Art. If I’d only had a week, only 3 days to give to it I could have handed in the whole MS in ship-shape—but now it’s very difficult, snatching ten minutes here, ten minutes there. And I must leave for Bpest on Tuesday. Hayford had to leave for the U.S. 3 days ago.

Later. I’ve just seen Elisina off to Burgundy. She is full of fight, but—perhaps it’s just nerves—she doesn’t look quite normal to me.

This sterling business—When the Nat. Govt. was formed in August, with its promise of a truce in politics pending reestablishment of financial equilibrium and confidence, I felt reassured, and though I was far away all the time, when the Bank of England’s rate was reduced to 4 1/2 and remained there, I said to myself that it must be all right, and the £80 million credit from USA and France must have been wholly adequate and have remained intact or at any rate not heavily utilised. And then the news of last Sunday, with its avowal that the credits were exhausted. What I can’t understand is, why—given that the obtaining of the credits didn’t in itself suffice to stop the run on sterling—the Bank of England didn’t raise its rate. If it had done so it might have made sterling attractive enough to offset the inducement to make a small profit on withdrawing gold and shipping it to the Continent.

It also seems to me that the Conservative Party, by agitating for an immediate Gen. Election, made a return of confidence, at home and abroad, more difficult, and also their aim of springing a protectionist tariff on the country at a time of crisis contributed to unsettle things.See “Inflation and Tariffs,” New York Times, September 29, 1931. And they are still doing it. Long before you get this you may read in the papers that a Gen. Election is imminent—or even that the Conservatives have succeeded in winning over to a tariff RamsayJames Ramsay MacDonald (1866–1937), a British Labour politician, who was prime minister between 1929 and 1931. He was the first British prime minister to visit the United States. and enough Lib. and Lab. votes to put through a tariff with the present Parlt.—and if they do so I suspect them of being capable of sacrificing the economy policy proclaimed by the Nat. Govt, together with unemployment relief reform and retrenchment on Social Expenditure—the very things that have most contributed to unbalancing the budget—in order to buy Labour votes for Protection. That they should still attempt this, at a moment when a 30% depreciation of sterling gives a huge premium to the British exporting industries, seems to me folly. The very last news seem to indicate a swing-back both from Protectionist ideas and from a Gen. Election—but that is probably only a rumour.

In fact, me vuelvo loco cabilando [sic].“I go crazy wondering.” The danger to the whole economic and financial structure of the world is so enormous that one forgets one’s own troubles—what little we have is in £, but I imagine I shall still be able to earn a living. The thought of the dislocation that would be caused by a lasting and considerable depreciation of the £ all over the world is one to which I can’t accustom myself. When one tries to follow out the consequences, one very soon reaches points where the overthrow of the remaining stable currencies would ensue.

Of course I tell myself that even if they have a policy in England they obviously must keep it to themselves, and if the short sellers of £ go too far, they may be caught as short sellers of francs were in 1924 and 26. If there were only some one there with the prestige that PoincaréRaymond Poincaré (1860–1934), a French politician who served as French prime minister on five separate occasions and as president of France from 1913 to 1920. had here.

I’m tormented by the thought of my old friend Mrs. Stuart Menteath, all of whose small means are in £. And yet what disproportion in that thought! How many others! One finds oneself murmuring old saws: ‘Pride had a fall,’ and remembering how the Romanesque sculptors represented Pride—a man falling from his horse. Pride that led the British to believe they could keep up for themselves a standard of living which the rest of Europe couldn’t aspire to.

As for Hungary—poor Hunks! They have an unbalanced budget, a heavy short term position and a passive balance of payments which makes it well nigh impossible for them to procure foreign currency to pay service of their long-term loans. I expect the position down there will prove extremely difficult, and that it will be a question of helping them to make arrangements with their creditors. It seems just possible that it should be pulled off, provided the social structure holds—that’s the great question, and I fear the answer is very doubtful.In The League of Nations Reconstruction Schemes in the Inter-War Period (Geneva: League of Nations, 1945), Royall Tyler wrote: “Now the National Bank had been losing foreign exchange for months past, and it was clear that orthodox methods were no longer sufficient to meet an emergency which threatened to exhaust the reserve in a short time, and ruin the currency. . . . Thus, with the help of a restrictive credit policy, the Committee hoped Hungary might be spared the blow that would be dealt its financial reputation by any interruption in transfer for the service of foreign debts. It recognized that it would not be possible for Hungary to meet all demands for repayment of the principal of short-term credits, and it urged upon all concerned the advisability of a breathing-space, and of securing equal treatment, as they had done in the case of Austria” (62–63). Nic. RooseveltNicholas Roosevelt (1893–1982), an American diplomat and journalist and friend of the Blisses. He was a member of the Council on Foreign Affairs, a writer for its journal Foreign Affairs, and a foreign correspondent for the New York Times and New York Herald Tribune between 1921 and 1946. had just arrived in Switzerland fr. Bpest when I was in Geneva, and ran over to see me, with pretty disquieting accounts of what is going on down there. However, I can’t hesitate to go, as that is certainly the place where I can be of most use at present. There was, before sterling went, a chance of getting Salter for Austria. Now, he’s badly needed at home, and it seems that at the best he would only be able to go to Vienna for a short time.

For months past there have been intrigues going on between the Quai d’O.Quai d’Orsay. The French Ministry of Foreign Affairs was located at the Quai d’Orsay in Paris, and thus the ministry is often called the Quai d’Orsay. and the Hung. Legitimists to put OttoOtto von Habsburg (born 1912), the exiled heir to the thrones of the former Austo-Hungarian Empire and pretender to the Austrian throne since 1922. In 1931, his mother, Zita of Bourbon-Parma, tried unsuccessfully to arrange his marriage to Princess Maria of Italy in the hope that Mussolini would present him with the Austrian throne. on the joint throne of Austr.-Hung., with French support, financial and political, and marry him to Pss. Maria of Italy, thus bringing about a young Diplomatic Revolution. Whether this is really serious, (to end the AnschlussWhen the Austro-Hungarian Empire was dissolved in 1918, many German-speaking Austrians hoped to join with Germany in the realignment (Anschluss) of Europe. Nazi Germany did annex Austria in 1938.) or is only intended as a warning to Carol of Rumania,Carol II (1893–1953), king of Romania between 1930 and 1940, who had returned to the throne after renouncing it in 1925. who is très mal vu“Frowned upon.” here, I can’t make out—but with all my sympathy for the Holy Crown of Hungary, I fear that Austria, which is profoundly democratic, would be disinclined to see a throne set up there—and if it were to be filled by Otto, with his strong Hungarian complexion, I should think the result would be to create, in a few years at most, a very bad internal politico-social situation. The Viennese certainly don’t want to be governed by Hung. Magnates with a fondness for Weltpolitik“World politics.” and intrigue and reaction all along the line.

Suppose that comes up while I’m down there? The danger exists, as France alone can offer them any money at present.

In all this, I don’t forgot that I have in hand several hundred £ of yours. If you want me to convert them at any rate obtainable—or at a minimum stated by you—please let me know by cable. I don’t think it would be wise to try in the present affollement.“Craziness.”

Bless you, precious Mildred, and think of me in Bpest—love to Robert.

R. T.

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