Capital journal. (Salem, Or.) 1919-1980, 1920-05-07
High Prices
AreLaid To
Profiteers

washington, MAY - seu"S "a
..o,iteering in American industry,
,.as under the auspices of the rail-
,,sv brotherhoods, was presented TO
.hs railroad labor board today in sup
~, az the railway workers demands
a. higher pay and to refute the
~ .sarve that increased labor costs are
s'sDonsible for the high cost of living
Prepared by W. J. Lauck, former
.oratary of the war labor board, the
.,rav seeks to show that profiteering
!. insustry is the fundamental cause
or high prices. 1t gives many statis-
scs 10 support that contention.
calling attention to the many war
made millionaires, the study contends
that the increase in the wealth of the
gealthy is an "unanswerable" refu-
,stiou to all attempts to charge labor
with profiteering.
aFor. if invested wealth, gets a
large return says the study. 'the
man who gives personal service or
labor is bound to get smaller pro-
portion.
Sugar Profits Example
Of the extraordinary increase in
the price of sugar now amounting to
400 percent the study says, the in
crease in labor cost paid by the con-
sumer was less than Is percent. The
result of advanced prices, according
Ia the quoted reports of twelve COM
nanies. was pictured in the net prof
its of these concerns which 1t was said
rose from an average of $4,000, 600
during the years Of 1912-1914 to $34.
100000 for the years 1916-191S.
In the meat packing industry
where profits were said TO have in
creased between 800 and 400 percent
the labor item was shown so small
that wage increase of 100 percent
would add less than five percent to
the total cost of meat. The increase
in price between 1914 and 1918 was
shown as eight times the total labor
cost and the 1918 price represented
IS times the total labor item.
Profits absorb approximately one
half the retail price of certain kinds
Of cloth, the report declared, while
the labor item amounts to from one
fourteenth to one twentieth of the
price. Similar relations were pictured
in the manufacture of mems gar
ments
Shoes according to the study,
furnish a splendid opportunity for
the profiteer,"
Labor Benefits Little
The profit items in 1914, 1t was
charged, absorbed nearly one half the
price paid by the consumer, or near
y three times the total labor cost
while in 1917 the profit items amount
ed to approximately three fifths OF
the total prices and over five times
the total labor cost.
Increases in the retail price of BIZ
luminous coal were shown at -four
times the Increase in labor costs while
the proportion of the proceeds of the
industry received by the coal oper.
ator was shown as increased from 7s
to 400 percent.
Profiteering did not stop with the
armlstice, the report declared, pre-.
Sentlng figures to show that corpo.
ration profits in 1919 were 10 pei
cent over the pre-war average which
means, the study added that 191!
profits were more than double tn,
average for the years 1912-1914.
An average of $1,000 per family o
iWe during the years 1916-1918 wa,
oeclared to be probably a highly con
serVatlve estimate of the actual cos
Vi corporate profiteering to the con
sumer,
Demands Summarized
concluding his study Mr.. Laucl
submitted the following general de
mands in the name of the railroa,
workers.
labor in general, and railroa,
aOOr IN particular, must have wag,
increases prOportionate to advance
IN living COSTS
- IN the present cricis, and 70
s' ume to come, producers and mid
me men must be restrained from ad
a@nc,ng prices in excess of increase
u aoor and material costs.
o-froducers and middle mel
must refrain fro mincluding incom
s s's excess profits taxes in their cost
auu passing them on to the consume
".n an added profit.
a-rhe principle of a living wag
o,s s' oe accepted and established ii
s.0. ~usr mat normal production may b
stored stored and increased production
epeu ior In all fields of industry"