Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1919-08-02
HOW TO REDUCE
LIVING COST is
GREAT PUZZLE
Continued from Page one.)

| The remedy suggested for this
phase is a revelation of facts con-
corning the European demand and
a demonstration of just how much
of a surplus is available. The
laws of supply and demand would
then operate.
Credit Also Factor.
| Third, the status of world credit
is a vital factor Europe has been
| buying largely with funds borrow
ed from America and paying the
high prices asked by American
producers. By furnishing large
sums of money the United States
! has herself helped to stimulate
European purchases at high prices
Although the general impression
is that the Washington govern
ment has stopped loaning money to
Europe, it is a fact that about two
and a quarter billions of dollars
have been loaned by us to the en-
| tente governments since the armis-
| tice and authority to loan $780,
100000 still exists and probably
will be used up to pay commit
ments already made. 1t is also a
significant fact that not one of the
European governments today has a
| high commissioner here asking for
money If European credit were
as badly off as some returning
travellers say it is, there would be
some activity here on the part of
the diplomatic representative of
foreign governments.
1t is confidently predicted by
men familiar with this phase of
our governments finances that
the European governments will
come into the market for private
loans soon with much smaller
quantities of bonds than had been
believed. The American govern
ment will cooperate in every way
possible to stabilize international
credit, but the day of government
loans is passing, and with it will
come an era of closer scrutiny by
the European governments of the
purchases made in their behalf.
Great Britain already is under
stood to be determined to await a
drop in American prices before
making extensive purchases.
Much Talk of Wheat Price.
Fourth, there is of course much
talk about the government guar
antee of the price of wheat. This
will, to be sure, be carried out.
julius Barnes of the United States
grain corporation in New York has
been in conference with President
Wilson and officials of various de-
partments. He has not yet made
his recommendations, but it is ex-
pected that he will bring forth
some plan to dispose of Americas
exportable surplus. The question
is, what would be the effect on
American prices in the future if
Mr.. Barnes sold Americas wheat
at $3.50 a bushel cash or if he &C
cepted the government paper of
Poland. Czech-Slovakia and the
other infant republics at $2.26?
The credit paper of these new
countries would probably lodge in
the government vaults for many
years before they would be worth
much On the other hand, the
treasury department probably
would be much more gratified to
see a cash transaction at $3.50.
The question of how long America
should continue to feed the new
republics IS also paramount. Our
generosity may not in the end help
the new nations themselves any
more than charity usually does the
poverty individual.
Feel Charity Breeds Idleness.
Loans extended on the basis of
raw materials exported to the
struggling republics of central Eu-
rope, meaning a revival of indus |
trial processes and at the same |
.;
antry to start cultivating crops and |
feeding their own peoples, is in
clined to be favored rather than |
continual flow of free food that |
might mean prolonged idleness.
Fifth. officials are emphatic in
declaring that there is no founda-
ton for the talk of imitation. Amer
lea with a so per cent gold reserve |
is the only country on free cash /
gold basis today.
To summarize, it seems to be the
opinion of conservative men in the /
administration that artificial and
elements which can
be removed by publicity are keep
ing prices up together with the I'M
certainty in Europe over the ratifi-
cation of the peace treaty and the
inevitable problem of financing
Europe back to manufacturing and
agricultural pursuits.
Europe Will Not Pay High Prices.
Europe is not expected to con-
tinue long to pay America high
prices, especially with European
sources of supply constantly in
creasing and with exchange against
her No one knows what waists
sums of money immigrants are
sending back to Europe and while
the balance of trade is bound to
continue favorable to this country
for some time to come, its true
when revealed will not
enable the American producer to
imagine that the worldwide de-
mand for his goods at high fig
1res is as permanent as he believ-
ed. The general tendency in Wash
Ington just now is to gather all
available information, consult the
best economists in the country and
sndeayor to bring about by pub
icity, by regulation and by con-
.rol of exports a sort of come
movement that will
oermeate the whole fabric of
American economic and rub of at
asst the wrinkle on the brow of the
worried householder of America.