Perth Amboy evening news., 1920-12-08
THE HASKIN LETTER
THE RELUCTANT PRICE
Nv Frederic j.. Haskin.

MASf1lNtrl CNNs L. Sss DcN- w
are informed on all hands that prices
are topping, but the toppie Is GER
tainiy a long time in reaching the
ultimate consumer. A few dollars
saved on an ~oyercoat, gasoline a cent
a gallon cheaper, and a few staple
food products perceptibly lower is
about the extent of the benefits
which have come to n typical
member Of that harried class.
And a large crop of differences of
opinion can be gathered as to how
far and how fast prices ire coming
down In the immediate future. Some
tell us that forces are at work which
must inevitably bring all prices
down a great deal in a relatively
short time. But others assure us
that as soon as the currency Is sta
bilized and Congress has amended
the tariff law so as to keep out i'm
ports, as 1t undoubtedly intends to
do. prices will tend to stick at a high
figure for a long time.
The situation at present seems to
be that. before a substantial price re-
duction a reach the ultimate con-
sumner, each of the factors in the
n~ecessaries of life has got to take a
loss. And each of them. not I'M
naturally, is Unwilling to do &c. Each
of them prefers that the ultimate
consumer should go on taking the
loss, as he has been doing for the
several years.
II cannot be denied that the strong
point in the position of the ultimate
consumer is that he does not buy
much. He has at last revolted
against high prices. If he will only
continue to buy scantily and to hunt
for the bargains which crop UP here
and there in increasing numbers,
prices will undoubtedly continue to
come down for a while, at least.
changes and the end of defla-
ton may check the tendency. but
prices will already have come down
a good ways, and it will be hard to
force them up again. This process
will be hard or the retailer for a
but perhaps better for all con-
in the long run than a con-
campaign of e~xtravagant
The Process
This seems to be the present pro-
cess of price reduction: The retailer
shelf. but he naturally hates to
a loss on them, or ever a re-
profit, so he holds out for the
old price as long as he possibly can,
and advertises a reduction safe only
forced to do SO by the need for
money.
Meantime he refuses to buy new
of goods from the wholesaler
and the manufacturer. even at some
what lower prices. The result is
that the manufacturer, rather than
produce goods which he cannot sell
ats good price or cannot sell at all.
closes his factory for a while and
throws half of his force out of work.
men out of work cannot buy,
and as their number grows, the de-
mand for goods which comes to the
retailer steadily decreases. But he
must sell something in order to pay
his rent and his interest charges and
other overhead expenses. So he is
forced to reduce prices, and that
forces the manufacturer to reduce
the price to him.
There seems to be no doubt but
that this process will bring prices
down, just as sure as a stone thrown
into the air will fall. Unemploy-
will come down just about in
~ ~ tiioN NV
Means Suffering
1t is a cruel process. 1t means a
hard struggle and some failures
among retailers and manufacturers
Of the smaller and weaker sort. 1t
meanS already hundreds of thou
ofsmen out of work. And men
out Of work mean hungry men, and
what is worse. hungry children and
hungry mothers. The gist of the
in that man, in his industrial
has created a machine which
he does not understand and cannot
No n is really happy about
this process except the ultimate con-
sumner, and he is lot very happy be-
cause he is not only the ultimate
who gets the reduced
price, but also the shopkeeper, the
manufacturer and the laborer, who
lose money. The only class which
really stands to make a clear. gain
IL the sslaried class. OF course, sal
aries may come down. hut they will
not come down as rapidly or easily
wages.
Y The Government employe, for ex-
ample, who got an inadequate raise
OF so per cent during the war, and
almost starved, may soon find him
self better Oft than some friend of
his who runs a store, and who made
barrels of money during the war.
but who Ia now in a way to lose some
OF II.
So the salaried man, IL he can re-
sist a reduction, stands to gain, but
everyone else stands to lose. And
apparently there is no way to avoid
this loss except TO pass it on to the
other fellow. That Is what everyone
is trying to do.
Consider the apple, for instance.
You still pay five cents apiece, or ten
cents for three. selected Ben Davis
apples at a fruit stand on a city
street. Do you know what the farm.
err got for those apples? Well, farm
ers near here got about two dollars
a barrel. The empty wooden barrels
In which they pack. the apples cost
them $1.25 each. The cost of hav-
ing the apples picked was IS cents
a barrel. By the time he had hauled
the apples to a railway station, the
farmer was lucky II he broke even.