Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-02-20
BUILDING WAVE NOW NEAR PEAK.
MANY ECONOMISTS BELIEVE
Babson Reviews Labor Situation and Factor Favor.
ing Higher and Lower Wages-Sees Rapid Road
Construction as Too Great Financial Drain.

living). Under these conditions il Is
difficult for wages to advance and the
tendency is for lower wages. Stats
tics show that wholesale prices are
gradually, although slowly, declining.
This especially applies to foodstuffs.
Corn, cattle, hides, wool and eggs, all
are tending lower. Retail prices In
evitably follow wholesale prices. Tho
reduction in living costs, which started
two years ago, but which was checked
last year, should he resumed. With
a world wheat crop of four billion
bushels In 1925. there should be
general reduction in foodstuff prices
all along the line.
Construction Work at Peak.
Economists generally agree that
building is at the peak and that the
automobile industry is about reach
ing its peak. If this is SO, 1t means
that the demand for skilled labor will
gradually lessen as these two indus
tries are the greatest employers Of
skilled labor today in America. OF
course these same economists have
been preaching for years that the
automobile industry was at the satura-
ton point. Whether or not they are
now correct, only the future can tell.
Both the building industry and the
automobile industry are intimately
bound up with employment and
wages, each depending on the other.
When one suffers both suffer. The
great increase in purchasing power.
which this country has been enjoying
| the past few years has come largely
from the wage workers Their in
creased purchases have been the asis
OF their Increased employment Hence
any let-up in these purchases would
mean Unemployment for many.
Road Building Big Factor.
Probably the greatest factor in the
wage situation. so far as 1t relates TO
common labor, is road building
Every community. during the past 10
years. has gone crazy over the ex-
pendltures for new roads. Without
doubt new roads increase va lues and
are a great enjoyment. but like any
good thing, they can be overdone.
Ultimately, however. the building If
new roads will he curtailed nv in.
creased taxes and falling off in de-
mand for tax-exempt bonds. The
new tax bill now before Congress. and
the difficulties developing in connec-
ton with defaults on road district
bonds. are causing investors to be
Tess interested in taX-exempt securi-
ties, especially wher issued by road
creasing so rapidly and road bonds
are becoming so much more difficult
TO sell. that 1t is very probable there
Will be curtailment in road con-
struction before long. Such a cur
tailment should release considerable
common labor
New Spirit Needed.
The labor situation may never be
solved, as 1t fundamentally is a moral
rather than an economic question
Surely It will never be solved by leg
islation, strikes, higher wages, or
shorter hours. The solution of the
problem will come only as both EN-.
ployers and wage work ers are
changed at heart and adopt the golden
rule. And the encouraging thing Is
that this is gradually taking place,
! for there is, today. a great improve
ment in the attitude of both en-
! ployers and wage workers compared
| with prewar days.
AS ! travel about the country and
visit different industries, it seems to
me that the greatest factor-outside
of ld-fashioned religion-which is
tending to bring employers and wage
workers together, is the tendency Of
wage workers to become owners. OF
course, wage workers have always
had an indirect ownership in indus
try through their savings accounts,
life insurance policies and the like
Today, however, there is a distinct
tendency for wage workers to buy Sc
curities in the companies for which
they work. and in other companies as
Continued on Sixteenth Page)