Detroit evening times. (Detroit, Mich) 1921-1958, 1941-07-04
Upward Trend
Of Prices
Dangerous
President Urged to Alter
Control Setup
BY HUGH S. JOHNSON

into a congressional wrangle,
postponing it a long time and
perhaps defeating it. Meanwhile
dreadful upward creeping of
great segments of the price
structure continues.
1t has already gone far enough
TO cost the public more than
our actual OUTLAWS for defense.
If it is not checked it could
be worse than all the mountains
of debt and taxes we have
incurred or authorized, and they
alone are appalling.
People are staggered by vast
appropriations and taxes be-
cause they see the figures all
in lump even if they are too
large 10 be understood. But
price initiation moves silently
through so many thousands of
little channels in such slow and
slight individual increases that
you can't get people excited by
jumping up and down and yelling
about 1t.
I THINK the best service that
L could be performed just now
would be the invention and
daily or weekly publication Of
some S imple understandable
index of the exact effect of price
increases on pocketbooks and
incomes--those of the govern
ment. the defense effort and
every individual in the country.
As has frequently been re-
peated here. the evil is not alone
the present or Immediately pros
pective Gripping effect on the
daily enjoyment of life. bad as
that is. 1t is also the gross
burden and the certain chaos of
the near or distant future when
in some paralyzing crash We
learn again a truth as certain
as the law Of grayitation.
Clear as all this seems, the
oppositions in Congress To an
ounce Of prevention now IS
strong and diverse. A good deal
of nonsense about the subject is
being spoken--that we had price
fixing statutes in 19l8-that we
didn't have them, tried TO get
them and failed, and so forth.
The truth is that there were
almost no direct price-fiXing
statutory authorities and that,
while we started much too late
and after the whole structure
got out of hand, we did control
most prices effectively and did
it without direct authority be-
cause, then as now, we were
afraid to ask for direct statute.
1t was a cumbersome and some
times leaky method, but in the
main il worked and saved this
country billions Of dollars.
TIIE control of the price OF
Il farm products. particularly
wheat, is frequently mentioned
as an example of a World War
statutory price ceiling. 1t was
the precise reverse Of that-a
statutory floor under farm
prices, not a ceiling over them.
The farmers were guaranteed
a minimum price for wheat.
about double the pres n I
average, 10 encourage planting.
During the debate on that
act they were twice assured by
the President himself that It
would never be used as maxi
mum, or fixed price. But il was
so used and this is the best
example to prove my point. Mr..
Hoover's food administration
was opposed 10 higher prices.
It's officials have since admitted
that, except for their control,
the price of wheat would have
gone TO S. or even $40 a bushel.
How was this done without
statutory authority or even
gains [ statutory mandates ?
Very simple. The government
had powers of licensing of grain
and food dealers and Of priorities
of transportation, raw materials,
transportation, fuel and power.
1t was just made generally
known that paying more than
the guaranteed price for wheat
wouldn't be a healthy business
practice and that settled that.
IF WE cant get better au-
Il thority now the government
can. as it did in 1917 and 1918,
apply the same medicine to
other commodities. even where
there is no guaranteed minimum
price and no licensing power.
There were few failures Of
voluntary cooperation in price
control, but in those few cases,
Mr.. Baruch's remedy was simple.
Without pounding his desk or
raising his voice, and in the
profiteer's presence and hearing.
he just reached for the telephone
and began asking for the Co
operation" of McAdoo on trans
portation or Judge Parker on
priorities. The bad boy began to
sec his wheels stop turning and,
with that vision. a great light.
That could be done again. but
not with the present admins
trative setup. II was possible
then because there was unity
of command" and complete CO.
operation in the overhead con-
troll of industrial mobilization.
We do not have that now. But