The Somerset herald. [volume] (Somerset, Pa.) 1870-1936, 1896-09-16
WHOLE NO. 1856.
The True Cause for the Decline in
Prices.

Mr.. David A. Wells, in late ex-
haustive article, after showing how
preposterous are the arguments at
tributing the extraordinary decline in
prices of commodities to the apprecia-
ton of gold, has this to say about the
real cause:
But if the opinions popularity enter
tanned respecting the universal decline
in prices are not warranted, the ques-
ton next naturally arises, What has
been the true cause? All who thorough
ly and without prejudice studied the
subject are agreed that it is to he found
in the following facts: That man with
in the last thirty or forty years has at
tanned such greater control over the
forces of Nature, and has so compassed
their use, that he has been able to do
far more work in "a given time and
produce far more product, measured
by quantity in ratio 70 given amount
of labor, than ever before. How great
has been the average increase or saw
ing in the worlds work OF production
or distribution can not, perhaps be ac-
curately stated. But few Investigators
place it at less than forty per cent. and
in some great branches of industry it
has certainly amounted to 20 or 50 per
cent Taking majority of other than
l..
alton, the saving of labor within the
last thirty years has probably been
equal to at least 10 per cent. in produc-
ing any given article. We have here,
therefore, natural, sufficient and
non-disputable cause of the remarkable
decline in prices under consideration,
and also for the continuance of such
decline; for prices are still falling, and
the only assigGable and probable rea
son why the decline experienced has
not been greater is, that decreased cost
has occasioned increased demand and
consumption, which to a considerable
extent has antagonized the natural
tendency to decline.
This decline in prices admits of
many examples of complete demon
| stration and illustration i'm respect TO
cause; namely, increased production
by reason of approved methods, or
new conditions, which have resulted
in decreased cost, supply in excess of
current market demand, and contin-
uous decline in market prices. In
other words, the price of any oommOd-
ity is fixed simply and solely by the
proportions of such articles as are pro-
duced and consumed, and prices can
not be, and are not fixed in any other
way.
Take, first, the market decline in the
price of wheat, which typifies more
than any other one product the griev-
ance of the American farmer. The
cause of this decline is the indisputable
fact that more wheat has been, and is
still produced-not perhaps more than
the world wants, but more than it is
willing to buy. The average annual
wheat crop of the United States in the
four years, 1s69-72, was 2i4, 1870
bushels. Since 1890 the average crop
has been about 570,000,01l. In 1873
there was practically no wheat export
ed from India, In lS92 India export
ed %, $50, 900 bushels. In 1850 the Argen
tine States of South America were not
| named rs a factor to the smallest eX-
tent in the worlds wheat supply. To-
day they are among its greatest sources
of supply, and of their surplus product
exported in 1894 10000, 900 bushels \
few years ago there were but few reap
ers and harvesters for wheat in Russia,
aud hardly grain elevator in connec-
ton with storage and delivery build
ings. To-day Russia is rapidly intro
dueing improved agricultural machin-
cry, with the result that its annual
wheat product has increased from l6S,-
545, 900 bushels in 1891 to 300, 100000 in
1894. There has also been a very
marked increase in recent years in the
wheat crops of Austro-H Hungary and of
Spain. Ii is impossible, therefore, TO
resist the conclusion that the produc-
creasing much faster than the necessi-
ties of the worlds wheat-eateys, and
that the increased production has been
in the countries where wheat Is pro-
duced at the least cost. In addition to
these conditions, We have now the an
nouneement that the surplus of agri-
cultural products in Australia avail
able for export, is in excess of the
demands of the people of the United
Kingdom for consumption.
The increase in the average of the
annual cotton crop in the United
States in the years from lS7l-62 to 1882
80 was more than 100 per cent, while
the increase in the population of the
country during the same period was
about % per cent. During the same
period it is certain that the worlds
consumption of cotton did not keep
up with its production. The legiti-
mate sequel of this has been that mid
land cotton that sold in 1850 for ll.5
cents per pound sells now August,
lS96) for 4! cents.
A UNIVERSAL DECLINE.
Similar illustrations of what has hap
pened TO the worlds products might
be multiplied to almost any extent; but
space will admit of but few additional
citations. In 1858 the metal alumni
mum sold for $50 per pound. Its pres
ent market value is less than 30 cents.
Copper kettles which sold in 1850 for
$3.50 can now be bought for 10 cents,
and this homely example illustrates
the great decline which has taken
place in the price of copper since 1880,
i. e., from % cents to 10 and L cents in
1896, which has been mainly due to
. the extraordinary productiveness of
American mines and new methods of
mining and smelling. Pig iron sold
| for $50 per ton in 1873. The same
grade can now be bought for Sll. Be
tween 1873 and 1892 the increase in the
production in pig iron in the United
States was 342 per cent. Recognized
authorities state that since 1890 the
worlds wool clip has increased l55 per
cent Careful ANALYSIS has shown that