Daily capital journal. (Salem, Oregon) 1903-1919, 1916-05-24
Business Interests Dominated
By The Great European War

New York, May 2O.-Business inter
ests are still chiefly dominated by the
war. The impression that peace is near
is gaining in strength daily. Germany
undoubtedly desires settlement if sat
isfactory terms can be arranged. I'm
fortunately, while positive efforts may
be made in this direction, the outlook
for immediate success is doubtful. Each
of the allies have heavy demands to
make upon Germany, demands to which
she is not likely to consent. Great Bri-
tain, Russia and France are on the as
cendant of power in greater degree
than at any time since the war began.
They have not yet had full Oppor-
tunity to assume the offensive and
strike their strongest blow, without
which it seems certain they will not
consent to peace. Therefore, while the
desire for peace exists and while some
preliminary efforts in its direction are
entirely within the range of probabil-
ity, the outlook for an actual suspen-
sion of hostilities appears remote. The
Mexican trouble seems to have passed
out OF serious consideration as q market
factor, although still source of con
siderable anxiety to the administration
at Washington. Politics also appear to
be factor of minor Importance from
the business standpoint, and this cam
paign is attracting less interest than
any presidential contest in many years,
mainly of course because it is over
shadowed in the public mind by war in
Europe and our own difficulties with
Mexico.
The labor outlook is causing consider
able perplexity in industrial circles.
Wages have advanced in many instan-
ces, especially in munition plants, as a
result of war profits. 1t is recognized,
however, that war profits are purely
ephemeral, and that when peace comes,
as it might within year, these will
quickly melt away, including the extra
profits enjoyed by many Of the indus
trials outside of the war group. There
are really two points of view regarding
the labor outlook. One is that when
the war is over, if not before, there will
be slump in everything pertaining
to the munitions industry; that a sharp
international struggle will Immediately
begin for the markets Of the world
that Europe will be on a much lower
cost basis than the United States; that
in consequence our exports of manufae-
lures, which nearly trebled in the last
nine months, would shrink back to their
former basis; and that consequently
there will be over-production and a
sharp Industrial setback followed by
lower prices and vanishing profits. 1t
is quite certain that sooner or later
some readiustment will be necessary,
if we are to meet foreign competition
and gain the firm footing in the world Is
foreign markets which is becoming a
national ambition. Profits win have to
return to normal, and costs win un-
dOubtedly be reduced. But the question
that chiefly perplexes managers is, viii
labor be willing to accept its share of
the inevitable readiustment2 PrObab-
| ly not, and this is a difficulty that
may have to be solved before many
months have passed. There is still an.
other point of view, which is this: Keen
foreign competition may admittedly be
unavoidable when the war is over; but
it is argued that we will be better pre-.
pared to meet that competition than
is generally supposed. Foreign eompe-
tition, it is argued. will not be SO
severe as many imagine, because wages
in Europe will remain relatively high
owing to the reduced supply of labor
and the excessive taxes which labor
will have to aid in paying. Further
more, neither Germany nor Great Bri'
tain will waste much time before en-
deavoring to regain lost ground; their
recovery and readjustment viii neees
sarily be gradual; consequently while
labor here may resist readjustment
it will probably gradually compromise
as leaders come to realize irresistible
conditions. Such are the widely diver
gent views of the labor outlook. 1t is
question If either view is entirely
correct, and q solution in all prObabil
ity will be found between the two. Ar
important factor in the labor outlook
will be the immigration movement
some authorities expecting large out
flow from this country when peace ar
rives, while others anticipate large
influx. The latter is the most prob
able, because of the unwillingness and
the difficulties which soldiers will ex
perience in returning to their former
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