The Wallace miner. [volume] (Wallace, Idaho) 1907-current, 1918-02-14

Pointing out that never before in
history has an understanding of the
simple principle of economics been SO
sorely needed, a committee of emin-
ent economists engaged in the study
of the purchasing power of money in
war time, issued today its first public
statement.
| This committee is made up of Prof.
Irving Fisher (chairman) of Yale uni
versity: Prof. e. w. Kemmerer of
Princeton university; Prof b. M. An
derson, Jr., of Harvard university;
DR.. Royal Meeker, United States COM
missioner of labor statistics; Prof.
Wesley Clair Mitchell of Columbia
university; and Prof. Warren M. Per-
sons of Colorado college. The COM
mittee in collecting it's facts has had
the cooperation of several branches Of
the United States government as well
as OF some large commercial and in
ancial houses The statement of the
committee follows:
Plans and Performance.
1.-THE country has experienced an
acute coal situation a drastic coal or
der the breakdown of railway trans :
portation, the taking over Of the rail-
roads by the government, mountaing
living costs, and price fixing.
These events crowded upon us
while we were still congratulating
ourselves on the success of the draft,
the passage of fuel and food conserva-
ton laws, and the unparalleled sub
soriptions to Liberty bonds.
"Enrollments. laws and subscrip-
tions, however, do not represent things
accomplished; they are only plans
laid out The test of the nation comes
when we try to execute those plans.
The breakdowns we are experiencing
show the magnitude and difficulties of
our task.
1--WE are undergoing national re-
adjustment to war conditions-a great
shift from a peace to war footing
the growing pains of which are acute
Just now, though they have been ex.
perienced. less acutely, for the pass
three years.
This war, the greatest of all, is
greatest especially in its cost. 1t is
estimated that the money cost alone
for all nations, is upward of hundred
billion of dollars. Each week it costs
as much as did the entire Boer war;
each month as much as the entire
Russo Japanese war; each two months
as much as the entire Civil war, which
hitherto has held the record.
Philosophy of Saving.
"Never before in history has an I'M
Outstanding of the simple principles Of
economies been so sorely needed. AL
though much is being done to supply
IL is need, we find the public confused
and vacillating between two economic
pbilosophies-the simple, direct old
fashioned, correct philosophy of saw
ing and working and the fallaeious
philosophy, perhaps best epitomized as
business as usual
$50 far as we let our business as
usual impulses prevent the needed
saving and economic shifting we shall
pay a terrific penalty in higher cost of
living, as we'll as in national inefficien-
cy and reimbursement
"The living cost and the level Of
commodity prices in general are now
as we are all aware, extremely high.
The average wholesale prices in the
United States last month were 81 per
cent above that of July, 1914; that u.s.
the purchasing power of money over
goods in the wholesale markets has
been almost cut in half.
"The rise in retail prices of foods in
the same period has been 81 per cent.
two thirds in the purchasing power of
money over foods in the retail mar
kets. Abroad the rise of prices has
been even greater.
Between 1895 and 1914 wholesale
prices in the United States were ris-
ing at the average rate of only one
fifth of per cent per month"; but even
that small rate, long continued. was
enough to make the III. C. L. very
painful fact.
Avoid Lending by Borrowing.
"Sinee the war wholesale prices in
the United States have been rising at
the rate of nearly per cent per
month, or nearly 10 times as fast as
before the war. In some countries in
Europe the rise in prices has been two
or three times as rapid as in the Unit
ed States. While the war lasts the
price level will inevitably
mount by leaps and bounds, unless we
adopt rigorous preventive measures. /
In particular we must avoid, so far as |
possible lending by borrowing.
Loans to the government made not
rom savings but from borrowings /
will tend to increase bank credit. Fur
her extension of bank credit will
chiefly bring about rise in commod-
ty prices. II is therefore desirable
hat further loans to the government
should be made out of current saw
ngs.
There are two ways for US to lend
money 10 orr country The right way