Iron County news. [volume] (Hurley, Wis.) 1913-1950, 1920-01-31
The Cause OF High Prices.

it would be the truth, but not the
whole truth In order to understand
how the war has brought about high
prices, what are the influences it set
afoot, and why they continue to work
long after the fighting has ceased, it
is necessary to be more explicit
The proximate causes of high prices
fall under three heads First, there
are the tremendous destruction of life
and property during the war and the
loss Of production caused by trans
ferring millions of men from industri-
es producing the necessares of life
either to the battlefield or to indus
tries making only weapons Of destruc-
ton. We have An inevitably diminish
ed supply of food and manufactured
articles TO meet a demand not diminish
ed in anything like the same degree
If, indeed, il is diminished at all. The
most fundamental of economic laws
thus works to raise the price of al
most every imaginable article.
Second, there is the combined effect
of a lowered rate Of production and
widespread spirit of extravaganza,
II is the universal testimony Of EN-
plOyers that less work per man is be-
ing done than was the case before the
war. Hours are shorter, labor is less
contented and Industrious, wage de-
mands, excited by the emergency pay
given during the war, are greater, and
at the same time people tired of the
sacrifices and economies of war time,
are spending money freely and pay
ing without demur prices that would
have stopped almost all buying six
years ago. Here is the protteer's OPP
portunity. He is not cause, but a
symptom. Prices wouldbe high with
out him. but it is the reckless deter
mination of the buying public to have
what 1t wants at any price that enabl-
as him to add something more to the
already towering ediiice of prices.
Finally, ut the bottom of it all is
the imitation of the money supply of
the world. Abroad that has been
accomplished by tremendous issues of
paper money, after the example this
country AIT in the Civil War In the
United States IL is the result chiefly
of the very large issues of gov
eminent bonds AMI notes and the ac-
companying expansion of credit based
upon these new certificates vi value.
During the war our circulating curr-
cncY. 'uciuding bank credits. increas-
ed IN quantity nearly two billion and
half at rate at least five times as
great as IN the year of peace. with
so impressive an increase in the stock
of money and no corresponding in
crease in the supply of goods, only
one result could be looked for.
These three causes. which may be
described AS material, moral and fin
ancial. all work diligently together to
push prices up and keep them up.
The only medicine that will affect
them is a proper combination of in
dustry and thrift, both personal and
national. When we are content ia
work steadily enough and hard enough
to make the goods that shall FIJI IN
our depleted supply; when we are
willing to save our money. instead OF
spending 1t on what tickles our fancy.
regardless of the price. we Shall have
gone long way toward bringing down
the price to a normal level.
The imitation OF our money nv gov
eminent loans was inevitable. Wars
are always costly. and they cannot
be paid for onthe nail. But the path
OF safety lies in retiring the bonds "a
tast rs possible even If heavy taxa.
uon is necessary 10 order to do il. and
In taking steps to prevent the unlimit.
cd use of government notes and hoods
as means of swelling the amount of
bank credits. The officers of the Fed.
ersl Reserve Board understand the
situation, and they have shown their
intention 10 check the advancing wave
VI speculation 10y raising the rates of
discount whenever the situation
threatens to get beyond control.
There sre several ways in which by
work or by thrift we can each of us
mitigate the pressure of high prices.
out high prices Will continue in great
er or less degree until we bring our
supply Of purchasable goods and the
amount OF our monetary medium into
something like the relation they bore
TO each other before the war. Youths
Companion.
sometimes a man misleads people