Evening star., 1933-10-08
CRUCIAL PHASE OF n. r. A.
CAMPAIGN DRAWING NEAR
New Law and New Cvernment for Indus
try Will be Created by Daily Con-
tact With Businesses Under Code.

that better relationship between cOStS
and prices is maintained. OTHERWISE
we shall have more and worse de-
pressions in the future rather than
fewer and more moderate ones.
The question Immediately arises:
What can the Government do to pro-
tect industry against itself in this re-
spect-I say protect industry against
itself, rather than protect consumers,
because the interests here are ultl-
mately identical. Industry cannot op-
crate permanently and continuously
unless it adopts the policy of relating
it's prices to its costs. 1t was with
realization of this background that GER
tain sections of the agricultural ad-
justment act and the national recovery
act were framed. 1t was conceived
under both these acts that industry
might control its own prices if ade-
quate public remedies were reserved
for enforcement The agreements"
under the farm bill and the codes"
under the recovery act give industry its
first opportunity to meet this problem.
If, In general. industries are willing to
admit that the policy of relating costs
to prices is necessary one, 1t will now
be possible to prevent recalcltrant buSl-
ness men from wrecking a program of
stable prices. For these agreements
and codes are given in the new legis-
lation the force and effect of law.
More attention, SO far, has been
given by business men to the preven-
ton of price cutting. This also is one
of the difficulties which can be met.
but it is a more immediate and OBJ
vious one. and not anything like so
important as this other one of relating
prices to costs and reducing the mar
gins of profit. The whole effort looks
toward stability and many industrialists
recognize both sides to the problem.
But, even if they should be reluctant
to see that their interests must at last
be brought into consistent relationship
with those of consumers and workers.
the Government does not lack power
for persuasion. The codes and agree
mentS. in order to have the force and
effect of law, have to be recognized by
the Government, and wise adminiStra
ton requires that business shall not be
given charters for exploitation Of work
ers and consumers, but rather charters
of responsibility to perform social tasks
in new and more cooperative way.
Freedom and Business.
The operation of these new acts is
sometimes forecast as the end of laiS-
sez-faire in business. However one may
feel about the desirability of this, it is
clearly not true, except perhaps in
very limited sense. These new measures
will reduce the scope of freedom. An
employer will no longer be able to
operate a sweatshop: certain retailers
will no longer be able to ruin their
competitors by price cutting; industries
will no longer be able to exploit their
individual markets without relation to
the future. But there is plenty Of scope
left for initiative: there is~still freedom
for inventiveness. and there will be
plenty of reward for business men who
exhibit these virtues. The danger is.
perhaps, that there will still be too much
freedom and that rewards will be al
lowed which are out of proportion to
service.
The time is here which will furnish
the test of administration. 1t is one
thing to write laws; it is quite another
to administer them-and especially laws
of this sort. which pass on to the execu-
tive officials most of the really crucial
decisions. 1t will be necessary to have
an informed and alert public opinion
following these decisions from day to
day.
The support which rallied to the
President as the legislative program was
being perfected will be even more need
ed as his helpers proceed to put that
program into effect. If any of us who
are officials fail to guard the public in
terest we ought to be checked immedi-
ately and forcibly.
It will not be easy for us to require
the cooperation of reluctant businesses
in any case; they have been used too
long to going their own sweet way with
out regard to any general program.
Consistent pressure and wise guidance
will be necessary at every step. They
will have the smartest lawyers and ac-
countants available-ones whose salaries
are ten, perhaps fifty times, those
which can be paid to Government serv-
ants They have shown preliminary
willingness to go along, having fallen
into so serious a state of late, but they
have never disguised their hope of US
ing the new legislation for their own
selfish purposes. They can be got not
to persist in this. and they can be
brought to see that their own interests
will best be served by merging them
with others: but these results will only
follow from the wisest and 1rmest guild
ance here at Washington.
tCopyright 1933)