The Rock Island Argus and daily union. (Rock Island, Ill.) 1920-1923, 1922-08-11

Warrington, D. C., Aug. 1870
much has been said to the business
man Of the United States and other
countries about the bus-bear OF
German composition that the de-
partment Of commerce has made >
special Investigation OF the subject.
Itshas led to the conclusion that
there Ii nothing to fear from Ger
many in the foreign trade field.
The basis OF this conclusion Is
the high cost OF production OF Ger
man goods which compete with
American goods in the worlds mar
kets. The facts assembled by the
American government make it clear
that stories Of extremely low costs
Of production in Germany are err
roneous and that the American
job is not menaced by
the competitionfof the TAuton.
What makes he German cost Of
production appear low and what
has enabled Germany to make a
show OF competing with the Unit
ed States, Great Britain and other
foreign trades with indications Of
success, Is the fact that German
industry 10. subsidized in various
ways. These subsidies, it is true,
enable certain lines of goods to be
exported at low figures, but in an
economic sense, Germany is the
loser and the actual cost of prOduc-
ton cannot be lessened by such
bookkeeping legerdemain. If the
German government is substituting
industries in order that they may
produce cheaply, Germany is none
the less paying the cost because the
taxpayers must furnish the funds
with which to pay the subsidy
The railways Of Germany have
been subsidized to the extent Of
81, 900 ,000, 600 marks a year. This
has meant that the government paid
to the railroads what otherwise
the industries would have had to
pay, adding the amount to the cost
Of production OF their products.
Nearlys s, O00, 000, 900 marks have
been paid in the last year as sub
sidy to the telephones and tele-
graphs. Here again the industries
are spared . cost by virtue of its
assumption by the government.
Public utilities have received
billions in government subsidies
and this means that they have been
enabled to charge lower rates to
industries for power.
Save Also IN Rents.
An extremely important Indirect
subsidy to the industries producing
German goods has been the body
Of laws limiting the prices Of goods
10 rinternal consumption and the
rate Of, house rents. By keeping
rents down, the government keeps
wages down and therefore con-
tributes to the cheapness Of produc-
ton. Before the war, the average
German workman paid about Is
per cent of his weekly wages for
house rent. Under the restrictive
laws which have forbidden land
lords to increase rents, the proper
ton of weekly earnings paid for
rent has decreased materially.
1t will be seen that If a manufac-
turer's workmen have to pay only
low rates, the wages for which
they can afford to work need not
be high. There has been strong
pressure from the landlords upon
the government authorities to per-
NIT increases in rent. but this has
been met with the statement that
to increase rents would mean q
general increase of wages and q
consequent increase in the cost u
production Of German goods. =
It is recognized that these condi.
tons capnot long obtain. The tax.
payers and the landlords will
weary Of paying a large percentage
Of the cost Of production of the
German factories. The German
people have stood solidly together
in attempting to keep down produc.
ton costs and enable Germany Il
Renter the foreign trade in such q
way as to undersell the United
States and other competitors, but il
Is apparent that the farce canuo
continue indefinitely.