Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-01-09
BY JAMES COUZENS.
Senator From Michigan.

1.-THE distinguishing trait of the
Twentieth Century seems to be its
ability to live beyond its means"
This quotation seems particularly to
typify the wild orgy of installment
buying now going on. We find many
economists and .statisticians en-
ployed by concerns and associations
Interested in profiting from INSTALL
ment sales making speeches and
issuing circulars in support of 1t.
These statistics tell only part Of the
story. There Is a very extensive
amount of installment buying upon
which they are unable to obtain any
figures.
We are confronted with all sorts
of slogans to encourage the buyer.
We hear, "Why not enjoy 1t as we go
along?", "Installment buying en-
courages thrift" 1T has the merit of
increasing the cost only to the time
buyer" What is this cost? 1t has
been pointed out by dean OF the
University of Washington that OF
every SO spent by the purchaser on
the installment basis, 81 goes to flnan-
cling the plan, and that it is obvious,
therefore, that purchasing power is
reduced 10 per cent as a minimum
While this orgy continues, and there
is the consequent stampede to in
crease sales, we may be Fronting, but
IL must be apparent to every one that
| we are reducing the actual purchasing
power of the people of this country.
Puts Blame on Buyer.
The buyer is most at fault. He is
allowing himself to be inveigled into
all sorts of installment buying.
j. H. Tregoe, executive manager
| of the National Association or Credit
Men, said recently:
when the installment market
which is made up of individual
human beings is glutted with con-
sumption goods, the law of diminish
ing utility will operate violently.
| Incomes will be overmortgaged; Tom
Dick and Harry will begin to consider
retrenchment, because they will have
had too great feast on the goods,
which they have bought on the Install
ment basis and they will have less ap-
petite for additional goods for some
time"
It is this appetite and the tonic
which is being administered to create
1t that I am particularly concerned
about. Look at some Of the adver-
tisements. Here is one for example:
Your authorized - dealer will put
this greater machine, complete
with busting tools, in your home today
for only 1926 down and the balance
on easy monthly payments"
One electrical refrigerator company
issues most beautiful circulars with
out naming the price of their refrig-
erator-simply SIS down, balance on
easy payments. Tons of such adver-
| Using matter are circulated, all OF
| which is silent on the matter of price.
Why? Simply because they want to
leave sufficient opening to add to the
| factory price of all the additional
items they must include for the buyer
on the installment basis.
| This terrific cost, which. In the first
place, is a minimum of 10 per cent, and
runs all the way up to 80 per cent.
is not much discussed. In the next
place, there is much advertising, cir
cularizing, and propaganda going on
showing that the loss through this
installment buying is only one-fifth
| of / per cent. But no mention is
made about the loss to the buyer
when the wagon backs up to the door
and takes his goods out, or when his
automobile Is repossessed.
Everywhere we hear of large profits
made by finance companies. These