Evening star., 1938-01-10
PR|CE-PR0FIT IDEAS
HELD BARRIERS TO
ABUNDANCE IN us.
Lack of Power to Purchase
Depression Cause, Says
Town Hall Speaker.
SOCIALIZED ECONOMY
HELD GAIN TO RUSSIA
Take Over Industries and Run
Them to Gain Security Is
DR.. Fairchild's Plan.

A deficiency of resources to purchase
consumer goods, the result of NAL
distribution of the Nations purchas-
ing power, is the approximate or i'm
mediate cause of the current economic
recession. DR.. Henry Pratt Fairchild,
nationally known economist and au-
thor, contended last night in a lee
ture before the Town Hall of WASH
ington.
DR.. Fairchild's simplicity of eco
| nomic language and the directness of
his answers to questions from men,
bers of the panel and the audience
won him the approval of a group of
listeners estimated at 500. His SUBJ
ject was THE Regression-the Way
Out"
In presenting his solution for the
Nations present economic straits. DR..
Fairchild declared there are several
| ways called by different names"
First. you must get rid OF the
domination of the price and profit
system" he asserted, land deliber-
ately inaugurate an economy of abun-
| dance
The only way is for the people to
take the industries and operate them
for themselves. If we want security
We must abandon outworn economic
doctrines and enter a new day. We
must pursue program that will sup.
ply us all with abundance.
Questioned by Panel.
This solution brought a crossfire of
questions from the panel and the
audience. The panel for the program
was composed of Wilson Compton,
head OF the National Lumber Manu-
facturers' Association: Dr. Albert At
wood. economist and writer on finance.
economics and government; Kemper
Simpson, economist and former eco
nomlc adviser to the Securities and
Exchange Commission; David Cush-
man Coyle. member of the Technical
Board of Review, Public Works Ad-
ministration, and noted construction
engineer and economist. and Huston
Thompson, who presided.
Asked if his solution was based on
Russia and Communism, Dr.. Fairchild
replied that he had spent a summer
IN Russia two years ago ana had
come to have mot the slightest
doubt that the introduction of So
cialized economy has raised the stand
ard of living in Russia to a great
extent. That nation, of course. has
been struggling against handicaps
that originated generations back"
In his opening remarks, the speaker
referred to the subject assigned him
and said Il am very glad you call
1t depression. This term is not
very we'll liked in certain quarters.
and there is some tendency to call
1t recession. In its early stages,
when the stock market first started
going down, it was called a technical
readjustment. You could read about
that in the paper and then not feel
so badly about the $4,000 you lost
in the market
The New York Times business
index shows that We have made a
sudden plunge downward We have
dropped 6 points in the last week,
TO point so low-except for a very
brief dip in 1934-that you have to
go back to the middle of 1893 to
find business conditions as bad as
they are today.
Doubts Business Strike.
If the depression is due to lack
OF confidence. then what caused this
lack Of confidence?" DR.. Fairchild
inquired
Personally, I can't give much
credence to the recent allegation
there is a business strike. I can't
visualize a situation where a manu.
facturer or business man would refuse
good order, backed up by a check,
just to spite the President.
I'VE are now operating under the
profit economy. Profits are the main
spring OF our economic life. That's
why business is so sensitive to any
thing interfering with profits, and
that's why the surplus profits tax
has aroused such opposition from
business. Business is operated for
profit and when profits threaten to
disappear, business closes down."
DR.. Fairchild contended President
Roosevelt had cut into the cycle of
prices at precisely the wrong moment.
Business, If it can't make profit
otherwise. raises prices. You remem-
Der the price-raising programs Of the
past few years and how the President
went on record in favor of raising
prices. Nothing was said. however,
about how they could be paid"
He contended nothing was gained
by raising wages and prices simul-
taneously and advocated either raising
wages or reducing prices. Prices must
be lowered beyond wages or wages
must be raised above prices" the
speaker said.
1t was announced that Alexander
KerenSky, head of the first Russian
government after the revolution which
overthrew the Czarist regime, would
speak to Town Hall on March 6 on
the subject, "On Behalf of Democ-
racy."
DR.. Fairchild was .ducated at Yale
University. He has been professor of
economics and sociology at numerous
universities, including Yale, Bowdoin
College, New York and California. He
has been lecturer and round table
leader at the Institute of Politics at
Williamstown, Mass. He is president
of the Population Society of America,
the Peoples League for Economic Sc
curity and has been president of the
Town Hall of New York since 1884,
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