left England and the mission concluded their report, which was forwarded to the Secretary of State for Foreign Affairs on Dec. 9 1920 and presented to Parliament as Egypt. No. i (1921).
After the MUtter Report. A period of suspense ensued during which the report was translated into Arabic. Its recommenda- tions reestablished the ascendancy of a moderate party in Egypt. After an effort to constitute a ministry representing a coalition of all parties, Adli Pasha accepted the task of forming an administration. His selection was in accord with the desire of the majority of the delegates who had visited London. It was then announced that " H.M. Government, after a study of the proposals made by Lord Milner, have arrived at the conclu- sion that the status of protectorate is not a satisfactory relation in which Egypt should continue to stand to Great Britain. While they have not reached final decisions with regard to Lord Mil- ner's recommendations, they desire to confer with a delegation nominated by the Sultan with a view, if possible, to substi- tute for the protectorate a relationship which would, while securing the special interests of Great Britain and enabling her to offer adequate guarantees to foreign Powers, meet the legiti- mate aspirations of Egypt and the Egyptian people."
Zaghlul Pasha returned to Egypt from France on April 5 1921 and was received with great demonstrations of welcome. He at once took up a position of hostility to the new Govern- ment, and, though offered a place in the official delegation, was only willing to take part in it if he were himself appointed presi- dent. The majority of his former colleagues of the unofficial delegation then separated themselves from him. He declared the new Government not to be representative of opinion and a campaign of protest against the departure of the delegates was inaugurated. Moderate opinion in Egypt was unfavourable to his attitude and he only retained the support of the extremist and the turbulent elements in the country, who were, however, successful in producing demonstrations in Cairo and in Alex- andria, in which city very serious riots took place on May 20, continuing through the two following days. They assumed the form of an anti-European outbreak, intensified by the nervous- ness of the European colonies and retaliation on their part against the demonstrators. The situation in Alexandria passed beyond the control of the Egyptian police and order had to be restored by British military intervention. Some 68 Egyptians and 19 Europeans were killed during the disturbances, and 162 Egyptians and 66 Europeans were wounded, the principal suffer- ers among the latter being Greeks. The effect of these riots, which were deplored by the majority of Egyptians, was to bring the question of the adequate protection of foreigners once more into prominence. Zaghlul Pasha indeed issued a mani- festo deprecating attacks on foreigners and protested that the riots at Alexandria had nothing to do with politics. But the general tone of his subsequent utterances, his continued efforts to undermine the Ministry and to discredit the official delega- tion, only tended to bring home to him the responsibility for these unfortunate events. In the autumn of 1921 Adli Pasha visited London, where discussions took place between him and the Government as to the proposed new constitution; but an agreement was not reached, and he returned to Egypt without any further progress having been made.
Economic Situation 1909-21. From the time of the economic crisis of 1907 the record of Egypt had been one of reviving and ever-increasing prosperity. The failure of the Bank of Egypt in 1911 and other failures about the same time were due to antecedent causes. The last of a succession of lean years with low Nile levels in 1910 was surmounted by the Government without recourse to a loan. The disabilities of the World War were more than com- pensated by the enormous prices realized for Egyptian cotton, which at one moment, in Feb. 1920, rose to 95d. per lb., ten times its pre-war price. The majority of Egyptian fortunes were invested in real estate and the competition for cotton land made 400 a not uncommon price per feddan, while instances may b quoted of land which reached 500 and even E6oo. Previously to the war the Egyptian financial year ran from Jan. I to Dec. 31. It was then modified to bring it into conformity with the British financial year and has since run from April I to March 31 of the following year. In 1910 the budget figures were: revenue, 17,177,107; expenditure, 17,077,207. Five years later, for the financial
year 1915-6, the increase was not very marked, the figures being: revenue, 17,759,418; expenditure, 16,594,666. But subse- quently they rose by leaps and bounds, until for 1920-1 revenue and expenditure were both estimated at 40,271,000. On the revenue side of this total 35,675,000 represented ordinary receipts, while the balance of extraordinary revenue anticipated was derived from the sale of land and profits from the control of cotton. On the expenditure side 32,616,920 represented recur- ring obligations; 5,654,080 was assigned to new works and 2,000,000 to loss on the purchase and distribution of articles of prime necessity. Upwards of seven millions of the increased expendi- ture was accounted for by the higher scale of remuneration assigned to all classes of government officials and the enhanced cost of mate- rials. The estimated increase on state railways and the expansion of the police forces accounted for nearly two millions more.
In the course of 1920 the universal crisis in production and the cessation of demand for Egyptian cotton caused its price to drop precipitously and in March 1921 it stood at only a little above the pre-war figure. In spite of the fall of price there were few buying orders, less than 50 % of the crop was shipped, and serious economic disturbance ensued. Tenants were unable to pay rents which had soared up with the high price of cotton, and landowners who had speculatively increased their acreage had to mortgage their estates. Goods, which had in 1919-20 been imported on a scale unprece- dented in Egypt's foreign trade record in anticipation of a contin- ued high purchasing power, remained unsold, and the bonded warehouses were overstocked with uncleared merchandise. On the other hand the general drop in the price of commodities relieved the situation of the labouring population, and the position was rendered less acute by the large profits accumulated during the preceding period by the class most affected by the paralysis of the cotton market. It was calculated in 1920 that Egyptian savings invested abroad, largely in British Treasury bills, might be reck- oned at 150,000,000, more than the whole public debt.
The break in cotton prices inevitably affected receipts from cus- toms, sales of land and other sources. At the same time the reduc- tion in the acreage devoted to cereals had entailed large purchases abroad, while the menace of a fuel famine had made it incumbent on the Government to ensure the coal supply in spite of the high prices prevailing. The result was that, while the financial year 19201 closed with a revenue somewhat short of that estimated, approxi- mately 40,100,000, expenditure rose to 53,000,000, of which 8,940,000 was due to food supplies and 6,460,000 to pur- chases of coal. Egypt was thus faced with a deficit of 12,900,000, to be met by a draft on the Reserve Fund, which had greatly increased in the prosperous years 191720, and amounted, after due deductions for depreciation of stock, to 15,942,866, leaving some three millions in hand to face a deficit on the budget for 1921-2.
While Egypt was enabled to meet this formidable deficit thanks to the accumulations of former years, the expansion of revenue had for a long time past fallen far short of the legitimate capacity and requirements of the country. The Egyptian financial system was inequitable and remained inelastic, owing to the impossibility of imposing taxation in proportion to wealth and of making it inci- dent on foreign as well as on local subjects. The land-tax, when reassessed under the scheme of 1895, was fixed for a period of 30 years from the date of valuation. It was then calculated to repre- sent about 28 % of the rental value. Before many years had passed it had ceased in any way to approximate to that figure, but it could not be altered until the prescribed term had expired. Egypt, one of the richest countries of the world, remained, owing to a com- bination of circumstances, one of the most lightly taxed. Limita- tions on local taxation have similarly arrested municipal develop- ment. These disabilities have indirectly contributed to the increase of criminality by restricting the extension of the police force, while expenditure on public health and education has been inadequate.
The Egyptian debt on Dec. 31 1919 stood at 93,299,640, dis- tributed between the three categories as follows: guaranteed loan, 6,199,900; privileged debt, 31,127,780; unified debt, 55,971,- 960. The Government and the commissioners of the debt held 5,282,260. The amount held by the public was thus reduced to 88,017,380. (J. R. R.)
EHRLICH, PAUL (1854-1915), German bacteriologist, was born in Silesia March 14 1854, of Jewish parentage. He was educated at Breslau and Strassburg, where he studied medicine. He was soon drawn towards research in chemistry, and in his earlier years carried out various important investigations in aniline dyes. He was at the same time winning fame as a bacteriologist, and in 1907 discovered a red dye, known as "trypan red," which effected the complete sterilization of animals infected with trypanosomes, a work of enormous importance for the treatment of diseases caused by these parasites. He considerably improved the technique of serum preparation, and also discovered a method by which the potency of the anti-diphtheria toxin could be tested. He also investigated the problems of cancer. Ehrlich's most famous dis-
