Evening star., 1934-07-15

And how does he see life? That is
not mere abstract query. Every
body's economics. everybody's politics
whether he knows it or not. Is derived
from his estimate Of life itself. Mr.
Richbergs estimate of life is a valid
prediction Of what his policies will be
in his new exalted governmental po-
sitionS.
Now Mr. Richberg sees life not as
an automatic toy for government to
wind up and to set peacefully spin
ming, but as a living and largely in
calculable process of eternal personal.
individual competition and struggle
Only through that struggle. as he
looks at it, do we get progress. have
heard him say.
Suppose that we had installed
strict governmental planning of the
vehicles of transportation. The plan
ners, in the early days OF the motor
car would have concluded that only a
small number of such expensive We
hicles would be needed and they would
have allotted to them only a small
amount of steel. But. in fact, we left
it TO private persons, like Henry Ford
TO decide how much steel was wanted
for motor cars. and they proceeded to
design cheap cars and to buy steel in
millions Of tons and TO sell the cars to
millions of consumers. 1t is said that
they worked without plans. / point
out that they worked with results"
Would Leave Business Alone.
Clearly we have in Mr.. Richberg no
extreme governmentalizer. But neither
do we have in him. on the other hand,
any extreme -governmentalist
Mr.. Richberg thinks that the powers
of government can be used to help
plan a balance" between the eco
nomic interests and needs of the diff
ferent elements of our national busi-
ness life. He thinks that the main
economic endeavor of government
should be TO establish that balance"
and maintain it. He would then over
whelmingly leave the actual operating
of business, whether industrial or
commercial or agricultural. to business
itself.
But what does this mean? What is
today the basic un-"balance" in our
national business life? Everybody
knows. It is the so-called disparity"
between the prices of agricultural
goods and the prices of industrial
goods. The prices of agricultural
goods are too low or the prices of in
dustrial goods are too high. In either
case there is created what the econo-
mists now love to call "disequilib-
rum" And the farmers cannot buy
as they should, and thereupon the in
dustrial workers cannot get employ
ment as they should. This is now
commonplace of even the most con-
servative economists. The National
City Bank of New York says:
The fall of the prices of farm
products and the loss of purchasing
power to the farmers has been large
ly responsible for the general depres-
sion"
May Advise Against n. r. A.
Mr.. Richberg. therefore. with his
principle of balance, will have to do
one of two things. He will have to
advise the President to help the Ag-
ricultural Adjustment Administration
to put more artificial props under the
prices of agricultural products. Or
he will have to advise the President
to command the National Recovery
Administration to put fewer artificial
props under the prices of industrial
products. I think he will do the lat
ter. There are at least two reasons.
In the first place, Mr.. Richberg is
no ardent enthusiast for govern
mentally assisted price control" eX-
cept in the peculiar political psyche
logical circumstances of last year. He
believes, l think. that those circum
stances are gradually passing by and
that normal pricings, through private
outright competition, can now be in
creaSingly resumed.
In the second place. the whole new
deal effort to restore prices to the
1926 level by price controls and by
production controls and by monetary
controls and by other artificial meth
DDS is ending in a tragedy Of diSap-
pointment. The last reports of the
Department of Labor show industrial
prices at less than 79 per cent of 1926
and agricultural prices at less than
Sc per cent of it.
Two things emerge from those sta
tistics. One is that the 1925 price
level as an economic heaven has ap-
parently no Jacobs ladder reaching
to it. The second is that the dis
parity" the "disequilibrium." the
damaging and demoralizing uneven
ness. between industrial prices and
agricultural prices continues. But
that unevenneSs is precisely what
must be changed into balance be-
fore total prosperity can recur.
May Let Industry Down.
In such circumstances I almost dare
to forecast the most startling develop
ment in the history of the Roosevelt
administration, We have been trying
to raise agricultural prices to the
heights of industrial prices. We may
now so orthodox" and try simply to
let industrial prices sink TO the depths
Of agricultural prices. If we cannot
jack agricultural prices sufficiently up,
perhaps We can ease industrial prices
SuIuClCIIIE GOWN. Anu the notlOu lIldt
this is now the only really feasible way
back TO balance" is maintained with
earneStneSs not only by many agricul-
tural advocates, but also by many
eminent financial commentators. The
National City Bank of New York. after
making the observation which ! have
already quoted from it, goes on boldly
and unflinchingly TO say TO business
men.
The failure of industrial prices to
decline IN company with the prices
OF farm products has been the prin-
cipsl cause Of unemployment"
Well II Mr. Richberg has to break
that news politically to the N. R. A
code authorities. he viii need all his
qualities. He viii need all his abound
ing animal good humor. He will neeo
all his equally abounding mental Vi
vacity He Will need all his capacity
for witticisms and all his capacity
likewise for laughing readily at other
peoples witticisns He will need al
the human eompanionaoleness and al
the human considerateness which en-
ahled him recently TO take price pro-
&erYsnr- o,14 ~ the steel roIe and still