The Elk Mountain pilot., 1922-12-14

and breaking the backbone of the
high cost of living. He has author
lied the following popular descrip-
tion of his theory.
With characteristic audacity, he
goes to the heart Of economic life.
He proposes to afford the ordinary
consumer cheaper commodities, to
furnish the producer with ready capi-
tai and security and to eliminate
such parasites as unnecessary middle
men and dishonest speculators-by
establishing the government as the
country's great middleman and by
making ordinary commodities, as we'll
as gold, the basis of currency.
Some time ago, at the suggestion
of Henry Ford and others, Edison de-
voted himself to study the causes of
economic unrest. His solution of this
momentous problem is now under the
scrutiny of the ablest economists and
business experts at Wellesley.
His plan is simple and startling.
He would have the government list
some forty basic commodities, such
as cotton, corn, copper, coal, wheat,
flax, iron, and then taking the prices
of the last twenty-five years as ba-
sis, establish an average price for
each. This price he would have de-
termined in terms of gold and called
unit or dollar
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take over or establish great ware
houses and storage plants. When the
producer is ready to market his pro-
duct he brings it to the agent at the
government warehouse, who gives him
certificate covering his whole de-
posit and at the same time pays him
half of the value of the deposit, as
computed on the twenty-five year av-
erage basis, in cash. The government
then stores the product.
When a dealer wants wheat, coal,
cotton or any other commodity he
buys the producers certificate on the
market, he presents it at a ware
house, pays the government back the
money advanced and takes the pro-
duct away.
The gowernment-fixed average price
safeguards the producer from the raw
ages Of dishonest speculation. The
half-value payment he receives from
the government affords him a ready
capital. The certificate he receives
is put on the market subject to the
ordinary laws of supply and demand.
But the certificate does not depend
on the gold in treasury vaults. but
on the commodity in the warehouse.
In one sense the Edison plan is a re-
turn to the ancient system of barter
as far as the complexity Of modern
life will allow.
Unit money in the Edison plan is
not money in the popular conception
that is, metal money or money with
a metal basis. The day when metal
furnished the most exclusive practi-
cal basis for a medium of exchange,
as we'll as a measure of value, has,
according to Edison, gone by. His
money would still be determined in
terms of gold. But instead of gold in
treasury vaults being its only basis
you would have wheat in the govern
ment pits. rice in storage, cotton in
the warehouses, etc.
"All articles deposited in the ware
house," said Edison, "bear the same
ratio when loan of unit money is
made-only one kind of unit money
is issued together with the deposit
certificate.
Suppose farmer puts in the ware
house 1000 bushels of wheat graded
by the government as No. red. The
average price for twenty-five years
of this grade, including high war
prices is, say, 81 per bushel. The
farmer is given $500 in unit money
he then can hold his wheat by means
of his certificate until he thinks the
price is satisfactory and thus be inde-
pendent of the speculators who now
set the price ahead months before the
crop is reaped. This certificate Is
bought on the exchange, at market
price now, say S1.15 for No. red.
The farmer would get s650-as the
wheat is higher than the twenty-five
year average. If. on the other hand,
it was selling at 96 cents be would
only get $460.
But the unit money would not
vary. 1t would always be the same,
because wheat would not be likely to
be sold over period Of one year for
SO cents. In other words, the certif-
icate or equity would have to be val
ueless to impair the value of that
unit money.