Evening star., 1936-12-06
Wage and Salary Changes
Concern Both Consumer
and Producer.
LABOR, CAPITAL URGE
CONFLICTING POLICIES
A. F. of L. Plea for High Pay Con.
trasts With Brookings Program
for Lower Production Costs.
BY CHARLES r. SPEARE,
ecjal Dispatch to The Star.

week the index of commodities is at
the highest level since 1880. The
wholesale food price is likewise above
that of any figure in six years.
There are evidences that the sup
ply of certain raw materials is short
OF requirements, which accounts for
their upward movement. 1t Is also
apparent that anticipation Of costs OF
future materials above those now pre-
vailing is causing considerable specu-
lative buying. Commodities asso-
ciated with the textile. iron and steel
and building trades have been strong
est. Farm staples have Joined in this
trend.
From these facts it is clear that the
cost of living must rise, and that wage
and salary adjustments to this new
economic situation must deeply con-
Germ those affected by it. The addi-
tional pay increases this week. and
the extra dividends declared, ease the
strain on the consumer, but do not
fully relieve it.
Naturally we have, as a result, re-
newed discussion Of the best means
of effecting temporary aid for the
wage Garner and for framing pro-
gram that will more equitably dis
tribute the profits of business and
give the consumer a higher purchas-
ing power.
Conflicting Solutions Offered.
~ and rina1glu
described by representatives of labor
and capital. At one extreme is the
proposal this week by the American
Federation Of Labor that wages be
advanced to $29 20 as q minimum for
a 40-hour week and to $40 week as
comfortable living standard" for
each family.
Ex-President Hoover, in an address
In New York on Wednesday, advo-
Gated the policy Of cheapening the
cost Of production and the price to
the consumer and, thereby, expanding
the buying ability Of the consumer
and his standard Of living. which Ia
the Brookings theory.
The two PHILOSOPHERS are at variance
with each other. The one most likely
to be realized in some degree is that
of the higher wage scale for organized
labor, for it fits into the scheme Of
the producer when he is prosperous.
Unfortunately. it is the program
that most penalties that great army
of unorganized in commerce and in
dustry, as well as on the farms, who
have no rigid wage schedules and
whose work day and work week is
most flexible.
The 3O-hour week Is not unlikely,
say in the transportation industry, but
the prediction Is now made that. be-
fore it becomes law, there will be .
scarcity of skilled labor in this field
and no basis for shortening hours Of
work.
Business Trend Strong.
The momentum of business this
week held strong both in the con-
sumers' and capital goods trades. Iron
and steel production was at the high
point of the year. Electric produc-
ton did not make so good showing
as previously. 1t is still much above
last December. So are carloadings,
bank clearings, building permits and
other evidences of commercial activ-
ity. Holiday trade is everywhere
booming.
Corporation dividends were numeri-
cally as great as the week previous.
but much less in dollar amount. Their
influence on the stock market has
waned considerably. This may be due
to counter-emphasis on the high level
of securities and the probable action
next month by the Federal Reserve
Board to prevent conditions approach
ing those Of 1929, and over which Mr..
Hoover Is again worried.
Weak Elements Recognized.
It is satisfying, however. to know
that the weak elements in the specu-
lative situation are recognized by those
in banking authority in Washington
and will be corrected 50 far as may be
within the law. There Is no passive
attitude toward Wall Street and its
extravagances as there was when
former President Coolidge and former
Secretary of the Treasury Mellon gave
It their blessing and could see nc
dangers ahead.
Whatever may be the trend of in
terest rates next year or the year
after, there Is yet no sign Of change
This week New York State borrowed
$50 0,000,0 900 for seven months on q
one-fourth of l per cent basis. The
United States Treasury sold discount
bills at q figure that gave almost nc
direct return to the buyer. Two large
public utility corporations disposed oi
81 per cent refunding bonds at pre-
miums of 2 to 21a points.
Next week the Government will an.
nounce the terms ON which it pro-
poses to meet its refinancing require
ments as well as to provide for cash
to carry into 1887. Undoubtedly the
rate will be low and the participation
in the offerings high. In q group Of
20 new corporation issues the average
advance over the offered price is IL
points, with individual gains ranging
from to 3lz points above what was
considered at the time . high asking
figure.
The investment report Of the life
insurance companies of the United
States. presented this week, gives some
significant data on the problems and
the policies Of this largest group o1
investors in the country. Briefly. Il
shows that during this year these In.
stitutions have moderately reduced
their holdings Of farm and urban
mortgages.
fcap1riri,t foaA ~ xAa rorth Anaricaa