The Cordova daily times., 1919-07-09
WEDNESDAY, JULY 9, 1919
WILL PRICES FALL?

w III p4ASCo AC1A13 OAAu IL ~, liz"
much? This question, we believe, is
the one nearest to the present interest
as we'll as the pocketbook of human
ity.
Although it is likely that the gen
eral tendency of prices may be down
ward during the next decade, the con-
sensus of opinion among experts is
that the decline will be gradual, and
there is a general impression that we
have attained a new price level that
will never give way to the pre-War
level. In a word, while it is conceded
that there will be a falling of prices,
the fall will stop short and perhaps
far short of the old level
We can get glimpse of the future
if we consider those elements of high
prices which tend to remain and those
which tend to disappear.
Present high prices may be ascribed
to three main causes-increased cost
of labor, higher rentals and higher
taxation We will have no difficulty
in realizing, for example, the inf1u-
ence of taxation when we are told
that taxes have increased in this cOun-
try 1000 per cent over what they were
before the European war. In Great
Britain they have increased more than
1000 per cent.
Rent and taxes, however, can not
compare with cost of labor as a factor
in fixing prices. Unless wages ma
terially decrease prices can not de-
cline radically, and there are few signs
that wages will go to a lower level.
Wages will remain high because of the
following basic reasons:
1. War Wastage-the stOppage OF
production due to the withdrawal OF
men and machinery for war purposes.
Millions of laborers will be returned
to production, but millions will not.
2 The virtual stoppage of immigra-
ton in 1914 The millions who for
merly came to our shores remained at
home, and it is extremely doubtful
whether the tide of immigration will
assume the old proportions within the
next decade.
8. The establishment of new indus
tries, such as shipbuilding and the
making of dyes and chemicals.
4. The increase in the demand for
materials for construction. During
the war construction was held to a
minimum as non-essential.
5. Shortage of the worlds food sup
ply and the worlds supply of raw ma,
terials. These shortages can be made
good only by slow degrees.
6. The higher level Of prices in
Europe.
1t has been perpleXing to some that
while men were out of work wages
should remain high, but if we consider
the foregoing list we shall acquire an
understanding of the conditions. There
has been scarcity of employment only
disappear as we shift from war to
normal production basis. The world
over there will be a shortage of labor
when anything like normal production
is restored. Shortage of production
in Europe has resulted from the col
1apse of credit and business. Men
are idle because business can not read
ilv be resumed on the old scale.
In this country we are rapidly re-
Stunning business on pre-war basis,
and unemployment is becoming rarer.
Soon the time will come when there
will be a labor scarcity, greater or
less, in all lines.
During the civil war prices rose rel
ativelv more than in the world war.
Based on greenback money, these
prices were largely inflated. Making
allowance for that condition, which is
not closely paralle!sd at this time, we
should note that the drop of prices In
rinety-two commodities from 1864 to
1874 was at the rate OF less tnan
per cent per year. In building ma
terials it averaged less than per
cent.
In the period from May, 1913 TO
October, 1919, commodity prices Id the
United States had advanced about lV1