New-York tribune., 1918-11-18
Business Foresight
Will Preuent Crisis
When Prices Fall
Continued from page ten

prices are highest and labor is work
ing overtime.
The very knowledge that such re-
source is held in reserve would in it.
self give a solid basis of confidence to
business and would tend to prevent de-
preston and unemployment.
(e) The Relations of Capital and
Labor.-Falling prices will be accom-
panied by falling wages. A recent
estimate would justify the view that
over 100000 of our people are at
present engaged, directly or indirectly,
in war work, including the millions en-
ployed in the Army, Navy and Marine
Corps. Many of these workers will re-
main in their present positions, as the
plants in which they work will merely
shift back from war work to peace
work, but millions will be thrown on
the pre-war labor market. Demand for
their services exists, but only at much
lower wages.
The danger in the situation lies in
the existence of two bodies of ex-
tremists. On the one hand is a radical
labor element, inspired by the senti-
ments of the Russian Bolsheviki, more
interested in an industrial revolution
than in conditions of work and rates
of pay; on the other hand, a body Of
employers who have always opposed
labor organizations and who may seek
to take advantage of after-the-war
conditions to bring about what they
call the "hquidation of labor" This
phrase seems to carry with it not
alone the idea of reduction of wage
rates, but also the destruction of labor
unions. Labor has taken advantage Of
its fortunate situation in the last
three years to unionize great many
shops which had hitherto not been
unionized. The policy of the govern
ment in connection with war work has
been sympathetic to labor in this mat
ter, though the government policy has
not been extreme. Labor Will do we'll
to recognize that present wages can
not be maintained. Business men will
do we'll to recognize that the achleve.
unionization during the war are per-
manent achievements. Both may be
counted on to recognize these facts.
(N Our Policy in Foreign Commerce.
The capital of the world does not
large iuassS' part ar capital capital Is just physical
goods, "the produced means of produc'
ton" railroads, factories, live stock,
goods on shelves, ships, improvements
on land, etc But the business man
also counts as part Of his capital his
good will" an intangible thing, not
to be weighed on the scales or meas
ured by the yard stick, but none the
less essential in the prosecution of his
business.
Above all there must be no scramble
for gold after the war. The rest of the
world must know that as it needs gold
and is willing to pay for it, it can get
it from US. We must have a free gold
market and must put no legal obstacles
in the way of free flow of gold. If
bankers all over the world should be-
come frightened as to the prospects of
gold, they would restrict credits, and
a real crisis would come. There is
plenty of gold to finance the after-the-
war reconstruction if it is intelligently
used. There is no danger that the
United States will be short of gold
after the war. With our huge gold
accumulation, and with the heavy in
terest payments due US from the out
side world, the prospect is rather that
we will have more gold than is eco
nomical for Us to keep. Our Federal
Reserve system, moreover. should en-
able us to get along after the war
with comfort with even less gold than
we had before the war.