The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1921-05-06
SURVEY OF CONDITIONS
ECONOMIC SITUATION IN
UNITED STATES SHOWN
Questionnaires Sent Out To
Business Leaders of
Country
ASSOCIATED Press Dispatch. ]

ASSOCIATED Press Dispatchl
Pinehurst, n. c., May 4.-Neither
money, transportation costs, taxation
nor labor can effectively or perman-
emily avoid the irresistible forces that
are working toward readjustment on
lower level, John S. Drum, San
Francisco. president of the American
Bankers Association, declared in a
survey Of the economic situation in
the United States su'-..litted to the
associations executive council here
today.
DR.. Drums statement was based on
mere than 1000 replies TO Ques
tionnai'e sent oy the association to
bankers. heads of transportation
companies and other business leaders
asking for authoritative opinions as
to financial, commercial, industrial
and agricultural conditions in the
nation.
All elements in the nations eco
nomic life must tall into line in the
process of readjustment, the report
said. 1T would work to the disad-
vantage of factors that would, if they.
it added The weight of opinion is
that this tendency toward stabiliza
ton will not be accomplished in the
year or the 1.-TWO years that line just
ahead Of u.s.
An abrupt transition from the infia
tion resulting from the war to normal
conditions OF peace time is impossi-
of readjustment must be gradual" he
continued, First, one element, then
another, feels the operation of the
memorable forces that are working TO
restore normal conditions" Mr..
Drum declared pessimists have told
being speeded by irresistible forces on
the road to economic ruin while ex
treme optimists say that around the
next corner lies upbounded prosper
ity, waiting only for our arrival at
the turn: Neither Belief was sub,
that comomn sense, and a knowledge
of fact, with clear vision, must guide
the nation in its struggle to solve
the broad economic problems that
have grown out OF the war and the
peace. ..
Economic Problems In Survey
Our survey has shown that the
great economic problems fall into
two classes which may be expressed
in terms of the problems of produc
ton and those of costs and markets
the survey said. Under the prob
lens of costs we have these factors:
labor, materials, transportation,
money and taxation.
And the problems of markets as
these: domestic: decreased purchas-
inr. power, the buyers strike, disin-
clination of sellers to take losses and
cancellation of orders. Foreign: De-
creased purchasing power of Europe.
lnadequacy OF prensent credit ageu-
cies: European political and social
Disqualification: Cancellation of or
der and exchange"
Discussing labor, the survey said
wases did not rise as rapidly as COM
modify prices during the war and the
tendency will be the last to fall with
reimbursement Thousands and thous-
ands Of workers. however, have been
thrown out of employment when
costs of production were reduced as
result of the decline in the worlds
purchasing power and the consequent
restriction of demand.
Wage reductions have been accept
ed in many industries but not in
building trades and among railway
employees. Mr.. Drum said. "The eff
feet of this resistance TO the econom
fc laws working toward stagnation is
apparent in comparative stagnation
in most parts OF the country in all
except essential building construction
and in the great decrease in railway
traffic because of high rates caused
by operating costs" he added. La
Dor no more than any other factor
can successfully resist the operation
Of economic law: a Danish king once
tired to ston the tide
The Railroad Situation
Under the heading of materials"
the survey said they were the first
Of the elements to feel the upward
impulse when the war came and al
ward new lower level. 1t is difficult
TO say whether reduced industrial
activity in the United States or re-
duced manufacturing ability of Euro
pean countries has been the more po-
tent factor in decreasing the prices
Of raw materials. The. weight of
opinion is that as readiustment at
home and abroad progresses there
will be reaction and the products nf
our farms and forests and mines will
move. Much of the Droduct is lying
Idle, although prices in some instan-
ces are as low or lower than before
the war.
Touching on the railroad situation.
Mr.. Drum declared rate increases at
a time when other services and com
modities were falling had a disas-
trous influence en- the nations bust
ness. The so-called liquidation of
labor has been perhaps the principal
rates. Opinions expressed in the
uuestionaires were that solution of
the problem confronting the trans
portation svstems-that OF operating
with financial safety and at the same
tine reducing to point at which
their effect on industry will not be
oppressive-is one of the most press
ine immediate ore requisites of sta
bjIized conditions.
Questions in the survey regarding
taxation showed there is discomfort
with systems of taxation which Mr..
Drum said never were just in prin-
ciple nor scientific in method OF col
lection. There is virtually unani-
nous opposition to the excess profits
tax. Majority sentiment favors a
sales tax to replace the excess pro-
fits tax. Opposition to a sales tax
was found among retailers.
Cancellation Allied Debts Opposed
Answers to the questionaires, Mr..
nr,Im said showed there is reasoned