The Washington herald., 1912-01-21
COST OF LIVING INCREASES
SIXTYPER CENT IN DECADE
World Condition Is Found by Scientists in Probing
the Present Problem.

does not inJure the producer as It does
the consumer, for the producer derives
satisfaction from the fact that business
is good Ultimately the country will be
as well on as before, whether with high
prices or with low prices.
The small man who sees no further
than his nose sees only the small local
causes: so, IN this country. he ascribes
high prices 20 the tariff or the trusts.
But the man with a broader view realizes
that the situation is Just about the same
in countries where there are no tariffs
and no trusts II all commodities in the
world tend to rice In price at the same
time II is obvious that there is some
cause which cannot be explained by the
conditions Of any particular commodity.
To say that the present high prices are
due to trusts will not explain the similar
rise OF prices in cases where there are
no trusts in those particular eommodi-
ties Of this country, or no trusts at all
in other countries where the rise Of
prices is also well marked. To say that
high prices are due TO the tariff does
not explain the similar rise of prices
in England. where there Is no protective
tariff. To say that high prices are due to
labor unions does not explain the rise Of
prices in the Orient, where there are no
labor unions. To say that the rising
ton or to the pressure upon the means
OF subsistence does not explain the rise
of prices IN those manufactures where
the raw material has only slightly risen
in price and where the wage cost is rela-
lively low.
Depreciation of Gold.
IAN these alleged reasons" said Prof.
seHgman, may constitute a partial ex-
PLANTATION OF a rise OF particular prices
far above the general level, but they do
not avail to explain the change OF the
general prices. Prices Of commodities
are their values expressed in terms Of
money-that is, OF gold. A general rise
of prices must, therefore. mean a de-
probation Of gold, and where there are
no marked changes in the conditions Of
credit or no diminution in the volume OF
business transactions, a fall in the value
of gold is always the result OF an in
crease in output
Money or purchasing power IN its
hroadest sense includes more than the
mere money metal. since business trans
actions can take place not alone for cash.
but also for credit. Consequently, with
every increase in the quantity OF gold
in the reserves OF the banks, the power
OF extending credit grows enormously. 1t
is well-known fact that bankers and
NhS
have recently augmented to a far greater
degree than the increase IN the output
OF gold. Hence. the secondary and ad-
ditional reason for the general rise in the
price level has been this augmentation
in credit facilities.
These causes are chiefly International
In character. and 50 there arises the need
OF an International commission to settle
the question as to what international
legislation Is needed to bring about I'M
proyement. No legislation can avail 10
prevent periodic oscillations in the rise
and fall Of the cost OF living until the
whole world--and not any single nation
gets ready to discard a particular COM
modify as money. and TO replace II with
an artificial and composite standard OF
prices. But that is something for the
remote future TO accomplish, and II VIII
come about only with the gradual cessa-
ton OF International jealousies and the
imperative need Of international COM
mercial stability.
The real problem Of Importance to the
world" concluded Prof. Seligman. is
not that OF high or low prices, for that
Is IN large measure the result Of an acci-
dent 10 the supply Of money metal The
real problem Is one OF high or low cost
High or low prices will ultimately take
care OF themselves. and the present high
cost OF living carries with II It's own
remedy II the people are patient but
cheap or dear cost means the entire dii-
ference between progress and poverty