, 1921-11-15
r.,,,Nc PRICES AND LOWER WAGES.

..Tbe latest computation of the course Of wholesale
ND retal prices,' says the BOSTON Transcript SHOWS
decline Of as per cent in the case OF the former anu
! a cent in the case Of the latter since the peak
~ living costs in 1920. Unexplained, the mere stare,
,nent Of the percentages. might suggest that tne TAI
In retail prices was being artihcially Retarded. 10
oh.s;n a proper understanding of the situation, 1t Is
necessary to know something Of the way IN wien
prices went up. The charts which snow ther COURSE
.nince 1919 make il plain not only that wholesale prices
cHrnbed faster than did the retail, but also that they
climbed much higher. The retail prices Jagged pc
hind the wholesale during the entire period OF rising
coats. II follows, of course, that for them to reach
substantially the same level, there must be a greater
fall Of the one than of the other. That has not only
happened, but former relationship has now peen re-
yersed. Recently the wholesale price level has fall
en- below that of the retail, but the difference Is not
yet marked. If prices are not following their down
ward course in close company, they may at least De
said to be in sight of each other.
Ultimately connected with this question. OF the re-
duction in living costs is that of the reduction IN
wages. Prof. William +. Ogburn of Columbia univer-
sitv. calls attention to the fact that the average week
ly earnings in the factories of New York have dropped
about IL per cent from the maximum Of s2o.s3.
Wages in these industries have not fallen as last as
has the cost of living. The contents OF the pay en-
yelope have a little greater purchasing power now than
they had when wages and living costs were both at
the peak. Naturally there is suggested the prospect
of further reductions both in costs and wages.
because it has been generally recognized that war
time wages were abnormal, it has been generally as
sumed that they would be reduced. The recessions
that have already occurred were in line with a policy
that was regarded as the correct one, even by a large
proportion of the wage-earners. The attitude Of the
public with regard to it was demonstrated beyond the
shadow of a doubt by the recent threat of a railroad
strike. 1t is a reasonably safe guess that in transpor-
tation and other branches of industry there are to be
further reductions in wages, either through direct
cuts or by changes in working conditions, which to
some extent amount to the same thing.
at is at this point in the statement of the case that
the Columbia professor speaks a word of warning. He
addresses it particularly to those employers who in
sist that reductions in wages should keep pace with
reduced living costs. He suggests, for example, that
in the case of the lower-paid employees care should be
taken to see that the standard of living made possible
by the relations of their wages to prices is now suit
able. Here is warning, among other things, against
the danger to the community of under-nourished chill
dren. 1t involves a question Of humanity, and it in
wolves in addition an economic question, because the
children of today are the workers of tomorrow. 1t is
also to be remembered that upon the boys Of today
reliance must be placed in the years to come for the
national defense.
The position sometimes taken in the current dis.
cussion that wages should be reduced to pre-war lev.
els probably seems to those who adopt it to be the sim.
pie and logical solution of the problem. But in re
atty here is a question of many complexities, calling
for much reimbursement of the business machinery a.
well as reductions of wages. Because it has been gen
orally admitted that there should be recession in wage,
III many industries, it has been easy to set the process,
in motion. But where the descent should stop is .
question that is harder to settle. 1t is certainly on,
that should be approached in the right spirit, and will
G view to bringing about r condition that will NEE
the reasonable expectations of all concerned"