Perth Amboy evening news., 1922-07-11
|STABILIZING OF BUSINESS
ACTIVITY IN AMERICA
Daily Letter by Frederic j. Haskin

man from responsibility, but the
| fact that such a pleading was made
reveals how general is the idea thal
periods of business depression are
beyond human control.
The theory on which the COM
mittee now at work is proceeding
is that much of the distress can o."
taken out of periods of depression
by providing, in times of prosperity
for work which can he performed
during bad times. One of the acti-
yities most depended upon for all
is public works. The proposal IS
made hat during periods or pros,
peritv when work is abundant n
wages good, the Federal Govern
ment and state and municipal gov
eminent should have as httle WORK
done as possible. Only absolutely
| necessary public buildings should be
| erected and practically no great
new public enterprises, such as
parks. extended water or subway
systems, irrigation and reclamation
! projects and the like, undertaken.
Public Works a Safety Valve
Then. it is claimed, when a per
| Tod of depression comes and prlVatc
employers lay off their workers, the
| Federal, state and municipal gov
ernments should inaugurate great
programs of improvement.
ing upon the stored-up work which
has been held in allegiance during
prosperity.
During the waiting period, the
p1an would provide that reserve of
funds should be laid aside to pay
| for the public work to be done in
periods of depression, and therefore
| thousands of people would obtain
! employment and receive pay out OF
| these funds who otherwise would
not be employed.
The plan can be applied to pri-
vate work as we'll. During periods
O. prosperity a corporation coul1
accumulate reserve funds and hold
in allowance desirable extensions and
improvements not essential 10 thc
making of the product. Then when
the depression arrived, this work
could be performed and men KEPT
| from unemployment thereby.
OF the objections raised to TINS
| general plan the principal M is
| that it is only in times of prosperity
| that companies and governments
feel they can afford to make i'm
| provements and extensions. In hard
times all feel poor and discouraged
| and are reluctant to spend money
for anything. 1t is this feeling OF
holding back which protracts de-
preston periods. Also. it is urged
that only in periods of activity is the
need felt for improvements and ex-
tensions. Companies. cities and in
dividuals are like the Arkansas man
of whom the Arkansas Traveller
tells. The Traveller found the man
sitting in his cabin and nearly
drenched by the rain pouring
through the leaky roof. He asked
him why he did not repair the roof.
The man said it was so wet and
slippery in the rain that he feared
to attempt the job. Asked why he
did not repair the roof when it was
not raining. he explained that then
the roof did not leak. This is pre-
cisely the psychology of business
depressions and periods of prosper
ity.
The members of the committee
which soon will make a report on
this subject aye Owen d. Young.
chairman; Clarence Mott Woolley.
Joseph H. Defrees. Matthew VOL,
Miss Mary Van Kleeck and Edward
Eyre Hunt, secretary. DR.. Wesley
C. Mitchell of the National Bureau
of Economic Research, is aiding the
committee.