The times-news. [volume] (Hendersonville, N.C.) 1927-current, 1935-03-27
THE ECONOMIC FALLACY OF
ARTIFICIAL SCARCITY

DIR. w. F. Hauhart, distinguished ecoii'-
p~,o mist of the Southern Methodist oilveiS'''
of Texas, is quoted by The Texas weekly
ssi: as saying that the countrys pohcleS u IL
striction of production are based on eco
nomic fallacies. DR.. Hauhart presented MS
49,. views in detail at the cotton conference re-
Gently held in Dallas.
The Texas economist takes the poStol
that revival of world trade is necessary
to restore improved conditions in this coun-
/ ------trv The leading authorities in the cotton
trade in the South agree with Dr. Hauhart S
views as they relate to the cotton trade HIS
| ----- views as to the general policy of attempt
So ing to restrict production, agricultural and
industrial, for the purpose of raising prices,
a6i .os2iTs that this course is based on economic
sx., So faIacy.,
gN,Ns., The Texas economist also points out that
Nihe ereht American virtues of applied en-
ss@~- ergy, (hard work. thrift and economy, are
- 49, ebeing rapidly undermined and destroyed
&JyEby this sesopsme policy. 1t produces a
= an scarcity of necessary commodities by art-
nIS-9ffcial means, ;artifcialy raises prices and
SSushes restricted production of commodI-
ties into markets at high prices, which the
people ARE unable to pay because they are
taot working sufficient number of hours
49, - to earn the money necessary to meet the
-OJincreased commodity prices. , ..-
- The system>is based on the fallacy that
If the people of this country worksiess and
l.. less for more and more pay, at higher ana
higher rates per hour, producing less and
less, all our problems will be solved 1t IS
a beautiful theory and appeals to large
g., proportion of the present population of the
- country. The only thing wrong with it is
81 shat it will not work
Having tried out thisstheory for couple
of wears under NRA rules and regulations,
snd found that it does not work, it seems
that the entire population of the country
S~@5xould be ready and willing to throw it
overheard, but not so. Millions of our peo-
Pile have not learned anything in this case
1 by experience. Others are profting by the
i r. manipulation of this economic fallacy and
they do not want to lose their advantage.
~sAEhey are willing to Cypress their fellow
Citizens and wreck their country for selfish
feasons, for personal ACKNOWLEDGMENT
81 The policy of restoring prosperity by
Treating an artificial scarcity of commodi-
ks~Stes is unsound; it is an economic fallacy.
zwEH will, as in the case of the South's cotton
crop, secure little higher price for the
kakrowers as long as the government makes
Sssthem gift of the difference between the
price cotton would bring without artificial
&@Aimulation and the price it brings under
S.SSrimulation; but as soon as the government
teases to apply, the stimulation, COTTON
Hs8snrices will probably drop and all the COM
81 S,peations from which the growers and
> lS1fh manufacturers have suffered in,sths rpasi
Ekawill appear in aggravated form S 4
- The government can hold up the price:
: of cotton by restrictive measures as Ions
las it pays the cost, but when all Of 5thl
schemes are dropped and the government
ceases to put up the money, the cotton
problem will be with US again in all of it
appalling details. The same is true of an!
other farm crop and is equally true in in
,dnstry. The way out of our difficulties i
not to be found by producing less and les
Ito be sold for more and more in market
where the people have less and less L
s3SAGpend because thew are Workinp less an,