Evening star., 1938-01-07
Unemployment
Continued From First PAge.)

NOOnClnueQ from f1rSC fARe.)
ductions costs rose 81 per cent due
to wage increases in the year ending
April, 1887, but the prices went to IS
per cent above the previous year
Similarly in automobiles. wage in
crease raised productions costs 27 per
cent in the year ending September,
1887. but price increases on the new
models have averaged 94 per cent.
In other words, the widespread
claims that increased costs and the
consequently increased prices were
caused originally by no other factor
but wage increases, are nothing short
of deliberate propaganda for the
obvious purpose of intimidating the
workers into the acceptance Of drastic
wage reductions. But those who re-
sort to such methods of exerting
psychological pressure in order to
secure wage cuts for the sake of the
immediate gain lose sight of the fact
that it is the maintenance of these
high wages that provides the broader
basis. and in fact the only basis, on
which recovery can be re-eStablished"
Earlier Gen. Robert E. Wood, presi-
dent of the Sears Roebuck Co., told
the committee he believed modifica-
ton Of the undistributed corporate
profits tax and the capital gains tax,
desterilization of gold. stimulation of
building and less terrifying admin
iStration threats against industry
would be factors helpful to recovery.
Urges Political Peace.
Pointing out that he had been \
New Dealer since 1888. the ex-Army
officer said he thought all parties
should cease hating each other and
get together"
Il feel We will be on our way ito
recovery by May" he added. There
must be activity in capital goods and
ing program under way don't think
anything would start housing with 4
bang, but the Government programs
should help"
Gen. Wood said he did not believe
labor rates are an obstacle to building
except in the largest cities.
He named four specific factors
which he believed have contributed TO
the present depression. They we're:
l. Overproduction last spring
2 Two increases in Federal re-
serve requirements and the steriliza-
ton of gold.
8. Failure of private capital to pick
up Immediately on cessation Of Gov
ernment spending
4. Too many administration state
ments calculated to scare business.
The Presidents recent address was
reassuring, he said, but those of other
administration speakers were not
Discuss Home Taxation.
One Of the most interesting OF Mr..
Green's proposals proba bly, is that Of
stimulation of private home building
by local tax relief. He made the fol-
lowing comment on this:
One of the fundamental obstacles
to the revival OF home building
throughout the country is the heavy
burden Of local taxation which the
home owner must bear. In view of
this, it seems to me impera tive to take
additional means of making home
ownership available without delay to
people of moderate means. The best
way two accomplish this would be
through program which would make
possible. for a limited period of time,
tax exemptions or tax remissions by
local governments on all real property
involved in home ownership. To make
this possible, Federal funds should be
made available to municipalities in the
form of subsidies to encourage such
tax exemptions"
Chairman Byrnes interrupted Mr..
Green in his presentation Of this sug-
gestion to point out the extreme dim.
Guilty of such subsidizations and Sen.
ator Murray. Democrat, of Montana
interjected further that constitutional
difficulties also exist.
Estimating unemployment at 8.475,-
TAO last November, Mr.. Green also
estimated that about 13 per cent Of
A. F. of L. members were unemployed
on that date, with another 20 per cent
WI hAAl6 pau ClAlC TVUcTdIlOI uHs
employment had increased to an esti.
mated II per cent in December, he
said.
Traces Recession,
In tracing development of the de-
cline Mr.. Green named as the largest
single factor "the increasingly specu-
lative character of the gains in busi-
ness activity in the first half of 1887"
Throughout this period" he said,
1T was evident that feverish profit
taking was taking place, with the
dividends paid out by corporations
entirely out of proportion to current
corporation earning"
Emphasizing the spotlines of the
recession, Gen. Wood said rural sales
of his company were up 1.3 per cent
in December, 1897, over year
previous, but that city sales were
down per cent.
Even more marked variations were
noticeable in the cities, he said, with
the highly industrial ones showing 4
sales drop as high as IS per cent,
while cities Of the "acific Coast and
Texas showed an actual increase.
Admitting that his comnanv,s in