Detroit evening times. (Detroit, Mich) 1921-1958, 1942-04-11
Initiation Put
On Parade Anew
ByGove;rnr|ment
Administration Seen
Getting Ready 10
Do Something
Bv LEWIS HANEY

CPrefsssor ct Economics. NsS Tork u
The subject Of imitation has
hared up again, Evidently the GOV
eminent. this time using the
ubiquitous Mr.. Henderson as It's
shock troops, Is getting ready 10
do something
The trial balloons are appearing
at the Presidents press confer
ences. where wage controls have
recently been suggested. Confused
remarks about the premium pay
mentS 10 labor have been made.
The gist OF the matter is that
the system of piece.meal price
fixing has failed. 1t has failed 10
hold down the average OF whole
sale prices. II has failed 10 hold
down the cost OF living. II has
failed TO prevent growing discrim-
ination and msladJustment caused
by letting some prices rise while
rigidly fixing others.
BoGEY BROUGHT OUT
So now the DOGGY OF imitation
this time dressed up in explosive
garments--is brought out. and the
assertion made that we must
"syphon of" some of the purchas-
ing power that is running prices
up.
Admitting that price-fiXing has
failed. the government nov seeks
an abb. and finds IL in ile so
called imitation gap. The trouble,
il says. is due to the existence of
too much purchasing power in the
hands Of consumers.
With a national income OF so
billion dollars, there are consumer
goods which at present prices are
value at only IS billion dollars. So
the proposal is, not 10 let the
prices rise till fhe seeds are worth
so billions, but TO "syphon of" Is
billions from the national income.
HERE'S THE CATCH
The catch is that those Who
have the extra IS billion dollars
have q lot Of votes, and the poll
ticians don't want to hurt them.
They are stalling, and feeling out
the prospective syphonees. But
they are so afraid of imitation"
and admitting the failure of their
price-fixing schemes. that they are
beginning to let their next move
be seen.
Briefly. this is to admit that
the major part of the imitation
gap" is in wages. The bulk of the
Is billion excess" OF income over
price of goods, is in the hands of
labor. So the "syphon" must be
applied 70 the wages pool. and the
excess be taken by the govern.
nent.
But first the patient is being
prepared for the operation. Loud
blasts are blown about regulating
profits" OF employers. The
laborer's cost of living is TO be
held down by more drastic control
Of farm prices, rationing, and
retail price-fixins. Then, II the
reactions Of the syphonees are not
too violent, wages will be SUBJ
jected to ~ q ceiling" and TO
CD increased taxation.
HOW THEY FEEL
Doubtless the administration
feels q good deal like my mother
used 70 when she assured me that
the spanking hurt her more than
II did me. But there il is.
At least, IL hardly seems that
a sales tax which would require
the laborers TO take government
savings stamps" 10 the amount
Of 10 per cent OF their purchases
Of radios. refrigerators, suits,
steaks, etc, would be regarded
as any less Of a "syphonlng Job
than any other form Of sales tax
The difference between forced
loan and a tax becomes less and
less as the public debt becomes
more and more fantastic and
nteanin sless.