Evening star., 1933-07-16
BY A. r. YOUNGMAN.

"HE administration has initiated a
domestic price rise by its Strate-
gic policy of bringing about de-
p-eclation of the dollar. 1t hopes
to hold and extend this rise by
systematic control and restriction OF the
output of agricultural and industrial
products.
In order to provide basis fcr con-
tinued profitable activity at Mgher
price levels. efforts are now being con-
centrated upon securing an lmmeolate
increase in returns to labor as a means
OF expanding consumption and prevent
ing overinvestment. viewed without
prejudice. therefore. the various parts
of the price-ra!sing program of the
Government appear to form an artlcu-
lated, consistent theoretical whole.
The administrative tasks involved in
execution of the price-raiSing program,
however. present many difficult problems,
upon the successful handling OF which
the success of the experiment VIII de-
pend. The theoretical aims, in short,
are fairly well defined: the practical
means to attainment of the ends sought
have to be developed by process OF
trial and error.
Some of the chief sources Of perpleX-
ity already have been brought to pub
uC dlleIlllOll. LdDOI, 4OL SAoAiiPiN' Ao
being organized to obtain higher wages
and shorter hours from groups OF en-
Dloyers united in an endeavor to in
crease profits and keep production costs
at a minimum. Associated employing
groups in turn will have to engage IN
p contest of strength with Other groups
which sell to them or buy from them.
In fact, competition under form OF
organization designed to control prices
IS likely to be as intense as it is in an
tnregulated economic society. 1t tenos.
however, to become less and less COM
petition to obtain markets by price cut
ting and acquires the character OF a
struggle carried on under official super
vision to obtain larger relative share
Of controlled output.
Duties of Administrator.
The officials who administer the ma
tional industrial recovery act will be
called upon to act as judges and con-
ciliators in settling the conflicting
claims of labor and capital and arbI-
trating interindustrial as well as in
ternal disputes arising in connection
with the formulation and execution OF
codes of fair conduct. The public ad-
mlnistratorS Will also be forced to as
sumo the role of legislators when they
interpret the loosely phrased provisions
Of the national recovery act. Finally,
they will be responsible for seeing that
violations of agreements reached are
detected by the policing agencies estab-
liShed to assure effective execution of
control plans.
Successful administration along the
lines indicated will prove to be impoS-
s.ble unless regulated industries CO.
operate in enforcing official decreeS and
making rebellious minOrities conform.
Obviously. 10 Federal bureaucratic Or
ganization could be devised competent
to perform unaided the work of franz
ing. rcconciling and supervising the
execution of codes of fair conduct for
thousands of industries. Hence the
chances Of success will depend largely
upon the reasonableneSS of the general
policies outlined by the official admins
traitors for the guidance of the asso-
ciated industries and upon the adequacy
of the supporting trade ASSOCIATION en-
forcement machinery.
The first problem with which the
Government administrators have at
tempted to deal concerns the flXatiOn
OF minimum rates of wages and max
imum hours of work. During the hear
ings on the cotton code, SpokeSmen for
organized labor appeared to demand
more than the representatives OF tne
mills were willing to concede. The
result has been compromise (em-
bodied in a code which is as yet little
more than an agreement relating to
wages and hours. which will raise
per unit rates of pay sharply in the
unSkilled groups and materially in
crease unit labor costs throughout the
industry.
In this case and in that of all other
Industries submitting labor codes for
approval. the Government officials must
decide how far the production costs of
given industry can be raised safely
with a view to increasing employment
and adding to mass purchasing power.
If increases in costs are SO great as to
compel sharp rise in the selling price
of finished goods, buying demand will
be curtailed, high cost establishments
may be forced to close, and others COM