Evening star., 1933-08-06
LASTING RECOVERY
FOR COUNTRY SEEN
Johnson Looks Into Future
for Permanent Prosperity
Under New Law.
BY MARK SULLIVAN.

In the industry recovery act there
are two points Of view, not inconsistent
yet not wholly parallel.
One comes from President Roose
velt What he has in mind mainly
IS relief of unemployment. He wants
more men at work. Wages are I'M
portant. too. but less so than number
of employees The President wants
to avoid during next Winter a dupli-
cation of last Winter, wants to avoid
repetition of a condition in which
there was something like 100000
unemployed. Hence in President
Roosevelt's conception of the indus
trial recovery act the spreading out
of work is the more important factor.
Assume that factory, or shop, or
q store or an Office has five employees
nov working 48 hours week. That
makes a total of 240 work hours.
Adopt the Industrial Recovery blanket
codes limit Of 40 hours tin many
cases 35 hours; to accomplish the
same number of work hours will now
require six employees. This means one
person taken out of the ranks of the
unemployed. That multiplied by sew
eral million such cases. would solve the
unemployment problem.
Gen. Johnson'S Idea.
Gen. Johnson's point of view is
somewhat different-at least he puts
the emphasis on another phase He
wants 10 solve the unemployment
problem too in the same way that
President Roosevelt does But in ad
dttion the general has a theory about
the effect of the industrial recovery
act. To him the act is primarily
means of bringing about permanent
prosperity. In this theory Gen. john
son has intense conviction.
He says the thing to do and the
thing which the industrial recovery
act will accomplish. is to build up
purchasing power" Until recently
there was very little purchasing power
because neither labor nor farmers had
much money in their pockets. Farmers
have been given money by the farm
relief act. Gen. johnson would create
purchasing power in the pockets of
labor by putting labor to work. Until
there is purchasing power, he says,
there can be no real prosperity. Fur
ther than that he says there can be
no real prosperity so long as-it is
put in these economic termS-"prcduc-
tive capacity exceeds purchasing ca
pacity." That IS, there can be no pros
perity so long as quantity of money in
labor's pockets With which to buy is
very much less than capacity of ma
chinery in factories to produce goods
for sale This condition, which has
been the condition of the past nearly
four years, Gen. johnson says is an
infallible formula for depression. 1t
has produced depression continuously
since 1929.
Would Build Purchasing Power.
Gen. johnson proposes to reverse
the condition. He proposes to build
up purchasing power by employment
of labor to a point where purchasing
power is greater than capacity of fac
tories to produce goods. The attain
ment OF that condition, Gen. johnson
says, is an infallible formula for bring
ing back prosperity; not merely Or
dinary prosperity but great prosperity.
He says that cncc the condition is at
tained-a greater quantity OF money
in the peoples pockets than there is of
goods offered for Sale-America will en-
ter into such period of prosperity as
it has rarely known before. Until Gen.
johnson became so busy. he would take
an old envelope out of his pocket, and
a pencil. and draw graph. First the
line of goods for sale higher than the
line of purchasing power. That means
depression. Then let the line of pur-
chasing power rise until it crosses the
line of production of goods for sale
that means prosperity.
About this theory Gen. Johnson is
as firmly convinced as ne is that day
follows night He is not the only one
who holds it. A considerable group of
business men. heads of some of the
countrys largest corporations, share
the conviction with him. consulted with
him in working out the theory, and
I,o IN, itc
come.
Where 1t Came From.
One way to understand this indus
trial recovery act. as anything else. is
to follow its history from its first in
ception.
1t did not begin with the brain
trust" Though subsequently some of
their ideas were incorporated into 1t
and as it now stands it accords with
some of their theories of social organi-
Zation. 1t did not begin with Presi-
dent Roosevelt. 1t did not begin with
Gen. Johnson. 1t did not begin with
Secretary of Labor Perkins.
1t began with very simple bill in
troduced in Congress by Senator Hugo
Black of Alabama. At that time the
bill was not part of President Rocse-
velt's emergency program. 1t stood
dIOllS uS du lued VI oclIdIOl DidCh D.
In that form it was simple measure
to reduce hours of labor. The bill
merely provided in effect, that all fac
tories, stores. Offices and the like, !
should limit the hours of any cne en-
ploye to 80 hours per week. The object
aimed at and the obvious result would |
merely be more employment. If re-
tail shop was habitually open go hours |
week. it would, under Senator Blacks |
proposed law, continue open 60 hours a !
week, but would need to have twice as
many clerks. 1t was simply a measure !,
for increasing quantity of employment,
and thereby diminishing unemploy-
ment.
Senator Blacks bill passed the Sen
ate Up to this point the bill was his
and his alone.
While the original measure was in
this form of simple, arbitrary limita-
tion of hours of labor to 80 a week, |
Secretary of Lab-r Perkins came for
ward with a suggestion. She said that
If the bill were to be passed at all. the
limitation on hours should be made