New-York tribune., 1920-05-08
Freed by
Expert Of High
Prices Blame
~ lett Lauck Presents Data
on Behalf of Unions and
Rrotherhoods Seeking to
Obtain Wage Increase
Addresses Railroad Board
s,sgests Two Methods to
Curb Profiteering and
Reduce Cost of Living


WASHINGTON, May Z. Presenting
uass of data prepared on behalf Of
IA rs;lroad brotherhoods and unions
ending to show that increased wages
,.ou,d not csuse higher prices, w.
lott Lauck, former secretary Of the
War Labor Beard, to-day suggested to
.b. Railroad Labor Board two methods
to curb profteering and reduce the
cost Of living.
Either the cost price Of all commod-
,t;es should be marked when leaving
.bs industry, Mr.. Lauck declared, or
congress should control industries as
,he railroads were controlled during
he war. BY marking with the factory
nriee. the public, he said, would know
( the retailer was charging fair
price TO the consumer.
The witness declared the way was
amen to stop the vicious cycle of in
rreased wages and increased prices and
he question was before Congress-,
where it must finally be solved. Ac-
,ion by Congress will have to come, he
asserted, unless the force of public
ouinion, acquainted with the real cost
Of commodities, reduces prices to the
proper levels.
Labor costs have been IN no way
responsible for current high prices,
Mr.. Lauck contended, producing statis-
tics tending to show that the enormous
profits made by corporations since the
beginning of the war have been the
cause. Labor is hardly an appr, .iable
element in production expense, he
argued.
Presents Profteering Study
Mr.. Louck presented to the board a
study Of protiteering in American in
dustry, which it seeks to show is the
fundamentals cause for high prices in
practically ali commodities.
Calling attention to the many war
made milionaires, the study contends
that threefold relationship exists,
between high prices, profiteering and
the addition to the quota of million
aires" and that the increase in the
wealth of the wealthy is an "unanswer-
able refutation" to all attempts to
charge labor with profteering and to
all attempts to hold labor responsible
for the high cost of living.
For, if invested wealth gets a larger
return says the study, "a larger pro
portion of the national income than
formally the man who gives personal
Tervice or labor is bound to get
smaller proportion.'
Of the extraordinary increase in the
price of sugar, now amounting to 800
per cent, the study says, the increase
in labor cost paid by the consumer was
less than Is per cent. The result of
advanced prices, according to the
quoted reports of twelve companies
producing over half of the sugar con-
sumed in the United States, was pic
tured in the net profits of these con-
Germs, which, it was said, rose from an
average Of S11 100000 during the years
1912 and 1914 to SB4 100000 for the
years 1916 and 1918.
Cites Profits in Meat
In the meat packing industry, where
profits were said to have increased be-
tween 500 and 400 per cent, the labor
item was shown so small that wage
increase of 100 per cent would add less
than per cent to the total cost of the
meat. The Increase in price between
lsl4 and 1918 was shown as eight times
the total labor cost, and the 1918 price
represented twenty-five times the total
labor item.
Profits absorb approximately one
mali the retail price of certain kinds of
cloth, the report declared, while the
labor Item amounts to from one-four-
leenth to one-tWentieth Of the price.
oimiisr relations were pictured in the
"lsnu1acture cl OF mems garments.
ohoes, according to the study, "fur-
IISned splendid opportunity for the
pronteer.s The profit items in 1914, it
was was charged, absorbed nearly one half
1He price paid by the consumer, or
tarly three times the total labor cost,
,niie IN l9lI the profit items amounted
approximately three-ffths of the to-
price and more than five times the
tal labor cost.
increases in the retail price of btu
minous coal were shown at four times
'ne increase in labor costs, while the
proportion of the proceeds Of the in
uuS'ry received by the coal operator
was SHOWN as increased from rs to 400
per cent. - w 100
s., An average of $1,000 per family of
i've closI curing the years 1916-1918 was de-
JARED to be probably a highly CON
SeEvatVe estimate of the actual cost of
eumer. VIC Non
Submits General Demands
,,;,t, Concluding his study, MIR. Lauck sub
f'.1ed M the following general demands
#" .I 1ne name of the railroad workers.:
n Labor in general, and railroad labor
~ particular, must have wage in
Eases I;n;a proportionate to advances in
g.; In the present crisis and for 81,
mo" me 10 come producers and middle
in ;neh must be restrained from advanc-
bnss pflces in excess of increases in la
'Or ap ana material costs.
fr,i iioaucers and middlemen must re-
cssa rsin from including income and ex-
r .sss profits taxes in their costs and
sn's,hg sa s5 them on to the consumer with
nrs. Inc principle of living wage
orda, mJs, De De accepted and established In
ssssr sss.a that normal production NAV be
bSuo,ed honor and increased production
in al