The Washington herald., 1922-08-29
The Much-Abused MiddIeman.

@ ENATOR CAPPER leader OF the farm
- block, recently called attention to what he
termed the exorbitant prices at which certain farm
products reach the consumer. Commenting upon
this, the Christian Science Monitor cites the example
of a preparation of cooked bran, sold at IS cents a
pound $500 a ton, whereas the price Of the bran
at the mills is about Sz3 ton. The difference goes
into Of advertising, other expenses and divi-
dcads--presumaby fat. The whole discussion cen
tiers around the alleged wastes and prohtccring OF
middlemen
For many years there has been much loose
thinking and looser talking this subject OF the
mddleman, who has been chiefly blamed for the
high cost OF living Every man between the pro-
dueer and consumer. engaged in distribution OF
commodities, is middleman. Unquest;enably great
fortunes have been acquired in the process, and
will be acquired for many years to come. The
tremendous demand for capital to open up new
fields, with the development which has followed the
discovery. Of steam power, electricity. the gas
engine and countless other devices-this demand
has prevented that competition of capital which
is necessary to keep profits down to fair return"
Moreover sociaistic other regulatory method
has ever successfully leveled prohts-usually such
methods merely cause expense, waste stagna-
tion in business, without reducing the cost Of living
While the masses of people have prohted by
the development Of industry, in standard Of lv
ing" vastly higher than that OF even half century
ago, the feeling prevails that wealth is nequitaby
distributed, that something is wrong in civiliza
ton which fosters involuntary poverty side by side
with bionaires.
The fact is that when industry once catches
up to ITSELF" when capital. rapidly increasing, once
reaches the ssturaton point OF new fields COM
petition will then set in on a scale, if the ele
ments OF monopoly are removed. That may take
fifty years century, possibly many centuries
with the standard Of living steadily increasing. But
sooner or later competition will prevail. Many
lines already feeling it-as in the OF the
small retailer pttcd against the department store
the chain store mail-order house.
One element that prevents these larger and more
efficient establishments from cutting prices, under
the spur of competition to the level that might be
expected. is the soaring level OF site-values. No
sooner does department store devise an efficient
oo>trcducng system of distribution. than the value
of its site mounts up and up. due to the stores in
creased volume Of business and consequent in
creased profits. a striking example OF this is seen
III New York City. the nations greatest market
pace About nc-hftcenth of the nations site
values, about SS.ooo.oooooo, arc in that single
city. Taken in the aggregate, the nations site
values amount TO about $4,000, 900 900, more
than 81 900 per capita. Rent. the economic
or ground rent these values. is collected either
uIicSuyN III SciHnS OF tease price, or fno1rcCt.F
part Of the purchase price OF commodities a tre-
mendous element of the cost OF living
No railing at the middcman will get around
this huge element in the cost OF living Compcti.
ton will eventually reduce profits on the sale of
commodities, but not in the value of sites because
sites Especially valuable sites in the business cen
tcrs) limited, whereas there is almost no limit
to the possibility of production Of commodities
n. farmer goes to town, drives down Main
stree,, and sees everythng-except's what's there
He sees the middeman, because he is in plain sight,
but he fails to see SITE VALUE, because it is
covered up by the buildings.