The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1924-04-09
figures ON us.
WEALTH ARE
N|SUSED
Noted Economist Declares
Figures More Misleading
Than in 1912.

NEW YORK, April 9.-Predic-
tons that the census figures on the
national wealth will be more mis-
leading and more stupidity misused
than in 1912, in the official jour
nal Of the American Institute Of
Mining and Metallurgical Engineers.
DIR. Ingalls,, a member of the Blu
reau of Economic Research, warns
of 1.-The danger of comparing and
using statistics of wealth in the
absence of good knowledge as to
what they mean"
Figures Low
1.-THE census estimates of the
wealth Of this country as of 1922
are now being published by States, .
he says. 1.-The totals expressed in
that way are running from so to
100 per cent greater than the cor
responding totals for 1912, the year
of last previous enumeration by the
census on this subject.
For intermediate years, eSpeci.
ally 1915 and 1920, there have been
available my own estimates, re.
ported in The Wealth and Income
of the American People As COM
pared with the census total for 1912,
my total for 1915 showed an in
credibly great increase.
II clearly drew attention to the
certainty that there was in fact
no increase so great as appeared by
comparison of the two figures and
the probability that the census fig
ures, which 1 riddled with criticism,
were too low. In spite of that,
those two figures, of different origin
and meaning, have been used un'
thinkingly in conjunction and have
been cited as showing a marvellous
increase in@ the national wealth
within a brief period, which in fact
did not happen.
Misleading.
1.-THE forthcoming census figures,
respecting the status in 1922, are
going to be even more misleading
and more stupidity misused. The
census figures are avowedly based
on current dollars, with the accom-
panying statement that il they were
correlated with the dollars of 1918
the new totals would be greatly
reduced.
Amateurs overlook that. how
ever, and are heralding such news
as that the people Of Rhode Island
have doubled their wealth during
the last ten years, wherefore, hur-
rah for present prosperity, the
benefit Of warfare, the benign in
nuence Of the automobile and
wages for plasterers at SIS per
day, forty-ho week, and all the
rest of the buncombe.
THE valuation Of the national
wealth is an extraordinary difficult
subject, and is indeed one that is
incapable Of anything more than
rough generalization, with consid-
cradle margin Of error, plus or
minus. The only method whereby
1t is possible to get truly com.
parative results Is the cumulative
method. such as an engineer is
bound to use.
Even so it is difficult, If not inn.
possible, to be consistent; and IL we
be charged with inconsistency in
theory and thought, there is moth.
ing to do but plead guilty. This is
the same whether it be the pro.
blem Of valuing the wealth Of the
United States or the assets of a
large corporation of diverse in
terests.
Railway Values Wrong.
"The fundamentals Of the pro
blem are we'll illustrated by a recent
valuation of the railways Of the
United States that was made by
the Committee on Public Relations
of the Eastern Railways. That
committee computed the present
mileage of track, the number OF
locomotives. cars, ETC., at pre-war
costs and prices and arrived at the
total of $22, $50 900, while the replace
ment cost today would be at least
$37 $50, 900 900.
How shall any comparison OF
our physical wealth in railways be
made except in terms Of quantity
or in dollars that translate and
compound the same thing? How
otherwise can we determine whether
the nation has grown richer OF
poorer?
But that is not the consus
method. What is the actual value
of the railways? Or rather, with
respect to what total should rates
be correlated? An economic con
troversy hinges upon that very
thing"