The Kennewick courier-reporter. [volume] (Kennewick, Wash.) 1914-1938, 1934-10-25

No Runaway Price Boost
National Topics Interpreted
-. by William Bruckart

No Runaway Price Boost
woebington.- President Roose-
N believes that commodity prices
v snrT 90 somewhat higher, but
~ has advised administration
,..ders to be on guard against a
srraway movement. In making
lrown his view, the President
,;Iewise for the first time tossed
a..vuarboard the plans of many theor-
~ for sterilization of prices on
.be s basis of the 1926 price range
nd adopted instead something APP
rroximating the average of quota
;ons existing in the period between
1909 and 1914.
Although Mr.. Roosevelt never
has publicly espoused the 1926
nrice level as such, his discussions
have given rise to a general belief
that the parity eyisting around
that time constituted a relation
.hip between farm products and in
dustrial products which was salts
factory to him. Therefore, when he
said the other day that he prefer
red the 1909-14 level, he turned his
face from the position occupied by
numerous groups, such as the COM
mittee for the nation and several
farm organizations that have con-
tended the 1926 relationship be-
tween farm and industrial. prices
should be the goal.
Most Washington observers
agree that the administration is
alert to the dangers of runaway
prices, resulting not SO much from
the unbalanced condition of the
budget and paper initiation as from
uncontrolled and ungoverned credit
expansion. In other words, it is
believed the President recognizes
threats of a dangerous boom which,
If it occurred, and was followed
By the inevitable collapse, would
leave our country in the throes of
another depression.
In conference with the Presi-
dent a few days ago, Mr.. Roose-
velt gave newspaper correspond
ents every indication of a convic-
ton that price questions involve
many factors that are at the par
ticular moment quite impossible of
ascertainment. He showed, too,
in the opinion of many of the writ
ers, that he is not following advice
of the theorists without giving
somepractical consideration to the
doctrines they advance. For ex-
ample, the Presidents position
clearly shows a desire to find ways
and means of preventing wide
fluctuations in commodity prices
such as those that have character
lied quotations in periods like
1920 to 1880. How far he will get
in working out such a system is,
of course, entirely problematical,
but his comprehension of the prob
lem has been accepted by the con-
servative element with more en-
thusiasm than they have given
heretofore to his announcements.
Nation Is Solvent
Mr.. Roosevelt believes that the
nation is solvent. He contends that
the column of assets has risen,
through increases in general prices
to the point where it exceeds the
column of liabilities or debts by a
small margin. Arrival of this con-
dition, therefore, has prompted him
to give thought to the question of
putting on brakes for rising prices.
It is my understanding that the
brakes are not to be applied yet. He
indends, however, to keep them
ready for use in case the runaway
boom appears.
None of the administration
spokesman are willing at this time
to disclose statistics which will
represent the price level that is
satisfactory to them. 1t is said,
nevertheless, to be a percentage
somewhat higher than now obtains.
The commodity price index of the
bureau of labor statistics shows
farm products now at 1878, which
research discloses is not far be-
low the period from 1909 to 1914.
The low point of this index figure
for 1884 was 57.4, and the low
point of the depression in March,
1888, was 42.8. Of course, Index
figures do not breathe life, but
when two sets of them are arrang-
ed alongside each other, they be-
come at least a basis of comparison
and after all, comparison is the
basis for judgment.
In some quarters of Washing
ton hear expressions to the eff
feet that Mr.. Roosevelt's latest
move regarding prices indicates a
conviction that restoration of the
country's solvency is more import
ant IN the general recovery pro-
gram than good many of the theo-
!etlcal and untried remedies brot
INTO use in the last fifteen months.
his price proposals obviously have
not ended conjecture as to pos
elble new moves. The program be-
ing in generalities did not cause
iears to subside concerning future
ampering with the monetary
structure nor did it alleviate con-
oltlons born of the pressure on
sommerce and industry resulting
nom NRA and it's hundreds of