The Arizona copper camp., 1920-03-20


pass any law that will put new capi
tai without it's sustenance into rail
road construction. Both the labor anC
the capital now engaged in railroad
operation may be worn out, but
neither new labor nor new capital car
be had except in the open market anc
at the open market price
Starved Railroad Credit
We have paid some labor on the
railroads more than the open market
price and we have refused the oper
! market price to capital.
The result is that the railroad sys
tenn, overburdened with labor, is starv
ing for capital. But the real damage
| is not to the railroads themselves
People can travel if they travel slow
ly. They can ship and exchange
goods even by slow processes. But
the moment the process of exchange
of goods slows up, two other nerve
centers of higher Importance become
involved. These are the food and
| credit lines and one is twined about
the other. With slow moving goods
there must be more food put in store
all over the county at local centers
There is not only accumulation at one
point and famine at another, but with
accumulated stores are decay and
waste.
The great nerve of credit affects ev-
erything and everybody when
stretched to the danger point. Credit
is based upon facilities for exchange
and the reserve supplies.
Congested Money
When money is moving quickly as
at Christmas time, it goes quickly
from factory payroll through the store
back to the bank. But when there is
breakdown in transportation by rea-
son of fault in the railroad, the troll
ley or the weather, the money may
remain in the unopened payroll en-
velope.
The northeastern gales that sent
the February SHOWS to the New Eng
land coast caused the Federal Re-
serve Bank of New England to issue
$25, 100000 of additional bills to take
the place of those remaining unused
in the payroll envelopes.
There is 4 strain in our monetary
structure by reason of the transpor-
tation Breakdown.
There is congestion at the seaboard
because the fall in international ex-
changes has prevented the sale and
shipment Of goods to foreign ports
and the full warehouses tie up the
banking credits, make high money
rates and force sales of securities on
the exchanges lowering valuations all
over the country.
Congested Warehouses
But this is not nearly so important
as that breakdown of internal trans
portation forcing the merchants over
the country to order goods six and
nine months in advance and carry six
and nine months stocks where form
erly 80 and 60-day stocks sufficed
Here is the great tie-up of banking
credits and it is due to the breakdown
of transportation and transportation
credits.
When the railroads come into their
own and again bid for transportation
credit, they may still further press the
monetary reserves.
Some lines of industry are now car
rying a years stock of goods or four
times their usual amount because
they cannot be sure of transportation
facilities. Thus the plethoric store of
goods and the famished credit bid
against each other at the base of all
monetary supplies and the interde-
pendence of man and the relation of
man to his fellow man in every phase
of life are emphasized
Food Supplies
hO AOcA VI Ll1O pl lCSSuL NY CuC GA
treme pessimist are that a fever. in
transportation Eegetting and accentu-
ating fever in credits may come in
collision with famine in food.
The simple fact is that the world
is consuming more than it is produc-
ing and we are called upon to put into
construction more than we are saving
Five years of warfare should mean
five years of reconstruction.
The DefIation Crime
Were we at war today, money
would be easy, people would be sub
scribing to government loans from five
to ten billions per annum and Wash
ington would be stimulating as well
as regulating production
Today, Washington having invited
people to subscribe to government
bonds to pay labor double wages and
fight the war with initiation calls for