The Bridgeport evening farmer., 1917-09-01
HENRY CLEWS
WEEKLY LETTER


WEEKLY LETTER
Tsou,dation in the stock market
has now continued with slight inter
rnntion for several weeks rms
downward movement was based en-
tirely upon disposition to discount
price fzing, upon the injurious eh
fects of an excessive profits tax anu
,r,on the growing prospects of peace
AIR three OF these influences mean a.
reduction, though not necessarily an
early end of war profits whicn nau
been the principal basis OF abnormal ma
advances in the war industriais- some
idea of the volume OF these oruers
will be gained from the fact tnat OUT
ing the fiscal year our exports u nnn.
materials amounted to $2'l2f'uoo,oV"i
~ which 100000, 900 was explosives,
s1s7 900 900 chemicals, $120,0oe'ouo
copper and brass. $s5,0oO,0oo IRE
arms. 9o.0O0,000 automobiles, 49,
0o0 600 horses and mules, $84,oOo,uuo
metal working machinery and $Sl,-
400 0oo wire. In the fiscal year
1a1s-fs. our total war exports were
Al a2e. 900 600; the increase last year
being chiefly, in explosives, firearms
copper and brass. Since the war pc
gan in 1914, our total exports Oh
munitions have amounted TO $o.ss6'-
, 900, 900. last years shipments Delns
about go per cent of that total me
nrofifs in these transactions, as Is well
known, have been very heavy, and II
a. earv TO calculate in what direction
their curtailment will be first applied.
whether the coming shrinkage OF
profits has been fully discounted. OF
not. remains TO be seen. For the Tune
beinr the market has been much dis
turbed nv these Developments; and
there Ia little doubt that the h1gn
water mark OF war profits has been
permanently passed and that q great
deal OF liquidation has been resorted
to by those who foresaw these conan
tons 1t will be months, n0WeveI
before any treaty Of peace can ~, pe
signed, and months more pelore ais-
bandraenf LII possible Of the various
armies which HI III ggahtfrne must be fed,
clothed and equipped. To the pur-
chases of the Allies must alsa be add
ed our own heavy buying Of muni-
tions. which combined with those OF
the Allies will insure high degree
Of activity in the war industries IoT
some time to- come.
Much uneasiness attaches to the
government PalicY Qf price fixing; also
TO 4he,e6tgsmelYa radiGl TENDENCIES
OF the excess profits tax II Is pui
proper to state that the governme emf
thus TAR has not taken extreme
meas,1res in price fixing, and shows
no such radicalism as Is rampant IN
the House in shaping the revenue bill
In the matter of price fixing, the ad-
manifestations has chiefly sought to
prevent undue advantage being takeT
Of war conditions by unscrupulous
spectators and profiteers. LIBERIA
profits have been allowed to both pro-
ducers and distributors. OF course
concerns which had been making alb
normal profits from one source or an
other were disturbed This woult
have happened in any event when thu
Inevitable reaction arrived from ma
tural causes. Nevertheless, govern
ment price fixing, however consider
ately enforced, can only be justified al
a strictly war measure. and shoult
be used as little as possible. and aban
doned as soon as possible. As al
economic proposition, 1t is wholly un'
sound; because there can be no sucl
thing as a fixed price when tn
thousand and one elements which
make the price are necessarily chang
ing. Fixed prices would tend to in
dustrial stagnation; and IL rigidly en-
forced, would soon be eyaded through
adjustments at some other part of tn
transaction. No government can ell
inmate the bargaining spirit In hu
man nature, which must always ap
pear whenever two individuals NEE
who have commodities or services TO
sale. Besides. If the government fixe
prices for commodities, it will eyentu
ally and logically be compelled to ii
the rate of wages for capital and labo
as we'll. But here again is somethin
the government could not possibly d
without invoking failure and disaster
Fixing the rate for capital would in
evitably lead to its confiscation an
thus crush enterprise Fixing tn
rate of wages is unthinkable; becaus
the American workman would neve
surrender the liberty to work for tn
best wages he can get and for whom
ever he pleases, as well as when h
pleases. Unfortunately, the war ha
made it easy to- launch a great man
socia1istic experiments. from which
may be more difficult to escape tina
expected. Great Britain has a1read
plunged much deeper into this reall
". Of uncertainty than ourselves; and
+, would be the policy of wisdom on on
part to watch results there before fo
lowing in her wake.
The radical proposals for taxing 81
cess profits as high as 10 to 80 pc
cent also produced a very unsettle
feeling. None OF our large bushes
concerns object to the appropriate
OF q liberal share of their extra prof
its to the purpose5 OF war taxation. BIT
large profits ara positively needed
many OF these concerns to offset e1