Evening star., 1942-03-08
Refai|Confro|s
Formed Slowly
y0.P.A.
Action Beyond Sugar
Curb Held Unlikely
For Six Months
sItGsl Dispatch to The Star.

shadow of the ONCE of Price Ad-
ministration is falling across the re-
tail counter, says Business Week in
the current issue. 1t will be six
months to year, however, before it
materializes-except with respect to
sugar, the article states.
A few other staple items Of food
and dry-goods may be included
sooner but that's a remote pos
sibility In the interim, o. P. A. will
count on its mere shadow. whose
broad and indefinite outlines re-
semble retail price fixing and
rationing, to police the business done
daily between retailers and ultimate
consumers.
1t is pointed out that retail price
fixing and rationing at the retail
level are today In the same stage
that price-f1Xing and priorities on
commodities at the manufacturing
and '.holesale levels had reached I8
months ago. Under the impetus of
actual war, however, and with the
backing of the new price control law
retail price control and rationing
probably will develop faster than
the earlier controls did.
Rationing Comes First.
Contrary to earlier expectations
o. P. A. officials expect to get the
feel Of rationing before they tackle
retail price fixing. This is because
the sugar situation developed faster
than Government officials had anti
cipated.
Since January, o. P. A. men have
been in daily conference with War
Production Board sugar officials in
an effort to iron out the details Of
the system which will be unveiled in
few days. 1t is now expected that
actual operation Of sugar rationing
will get under way late this month.
In the absence of direct price
control at the retail level, the
responsibility for keeping retail
prices at reasonable level rests
squarely on the shoulders of the re-
taller" the Price Administrator said
this week, in placing temporary
ceilings on the wholesale price of
canned goods. Henderson earnestly
hopes such warnings will be
sufficient, but he declared that
should this responsibility prove too
much, o. p A will take steps to
control prices at the retail level"
To cope with situations demand
Ing immediate attention, o. P. A.
will fall back on the provision of its
law calling for temporary price
ceilings based on prices prevailing
during ive-day period some time
prior to the effective date of the
ceiling. In its simplest form. such
a ceiling would tell retailers that
they cannot charge consumers more
for q given product than they
charged during the flve-day base
period. This was the method
adopted in freezing wholesale prices
Of canned goods.
Many Problems Arise.
Temporary ceilings. however. must
be replaced by permanent ones
within go days This is what Is
causing o. P. A. most Of its head
aches in considering the retail
price problem. In fact. o. P. A.
officials admit that their thinking
hasn't yet extended to the details
of permanent retail price ceilings,
which will raise numerous corollary
questions as to sizes, standards
grades and brands. Most 0. P. A.
men dealing with consumer goods
personally believe in grade stand
ards, but they also take the view
that price control is a big enough
lob without taking on reforms
which the consumer movement could
not effect in normal times.
O.P. AS revived Consumer Divi'
sion believes that price control on
consumer goods must be tied to
some kind Of quality control, and
division officials are preparing 10
provide and urge such standards.
Best prediction is use OF STANDARDS
and grades-trade standards IN
some instances - where absolutely
necessary to protect price controls
but avoidance of pushing grace re-
forms for reforms sake.
Enforcement Difficult.
enforcement of retail price con-
trolls is the big problem. partlcu-
iarlv when temporary ceilings have
Ia be replaced by product schedules
prevailing view is that the retailer
will have to post schedule prices
prominently in the store and prlmar!
enforcement will come from buyers
and competitors. This means that
ceilings will have to be as simple
as possible on goods which tne
average consumer buys.
Simplest form Is to set one pIice
for a size and type OF commool,y
over the entire country. This Wouio
mt high-cost retailers at a dls'
edvantage with their low-cost COM
netitors, but it would permit use OF
Nationwide publicity to educate the
consumer as to the price. Settlns
nrices In terms Of margins or per
rentaee markups might work on
nroducts where the buyer Is more
or less informed but prooaoiy
wouldn't mean much to the average
housewife. avn.
Setting prices in terms OF pre-
vio,Is period or day, as in the case
of temporary freezing orders, prop
ablv will be the most frequently
used because it allows for dif1eren-
tials in the cost of retailing, ano
gives some degree Of consumer en-
forcement. The only drawback is
that the consumers memory might
not be good enough to recall the
price charged in the base perloo.
Again. such a technique might
work unusual hardship on mol
yidual retailerSgrocers who mlent'
for instance, have been selling tne
nrice-flxed commodity at loss.
leader prices during the period
chosen as a base would be stuck
with those low levels as top CELL
ing for the duration.
All Could Be Used.
nh. nrevailing view Is that all