The Waterbury Democrat., 1942-01-29

Edison DTcVeIlCeu INV 40
through a much more drastic freez-
ing of all prices than is called for
by the administrations program OF
freezing only selected prices.
Before Pearl Harbor, wholesale
prices were advancing at the rate
of about 11a per cent a month. In
the first month after Pearl Harbor
the rise was per cert and in one
week it was l per cent. Increases
on the main items-food, furniture
and clothes-average about Is per
cent over the past year, but all
items are up. Wholesale prices on
farm products have gone up over
So per cent and on foodstuffs oyer
Is per cent.
This rise in wholesale prices has
been faster than the rate of rise
in the cost Of living at the retail
level-which speaks well for the
effort which the retail merchants
have made to hold prices down-but
that can't keep up forever in the
face of more rapidly advancing
prices of wholesalers. Sooner, and
not later, this can only mean that
the consumer Is going to be hit
harder than ever. His reaction can
be expressed in only one way-a
demand for wage increases. When
that comes there you have the dizzy
spiral which leads only upward to
initiation.
OF course it's nice to have every
one getting little more jack-re-
CARELESS ow whether it come in as
wages or profits on a sale. The
grief in this particular situation is
that higher paychecks and bigger
sales slips don't produce any more
munitions-they make just the same
quantity of battleships, bayonets or
buttons cost more money which can
come only from higher taxes and
bigger debts There is nothing new
in that statement. 1t is so old now
that It should be pubi:c axiom num-
Der one. But it apparently can't be
repeated too often to make it stick.
1t applies particularly to the
present situation because prices now
may be advancing faster than they
can be controlled under the provis-
ions of the new price administra-
ton law. 1t may take the Price
Administration too long to swing
into action, 1T may mean that an
organization can't be whipped into
shape fast enough to handle these
rev spirals of initiation.
EASING INTO CONTROL
Up to the time the price bill was
passed, Price Administrator Leon
Henderson's organization had issued
only about rs price schedules, near
ly all covering materials going into
war production. Two-thirds of the
principal commodities of general
trade are still uncovered.
Perhaps the Office of Price
Administration has felt that it
should go a little slow in plastering
price ceilings on these walls OF
rising prices till after the new price
bill was passed. Cnquestionably,
Hendersons ceiling on peanut oil,
cottonseed oil and other fats and
oils was what reused the ire of
the farm belt senators who have
made the going SO tough for the new
price bill in the last month.
There is a further advantage-a
psychological advantage to the idea
of freezing all prices as of some
given date. When this price bill goes
into effect, Leon Henderson and all
his thousands of Price Administer
ton employees are going to be the
most unpopular people in the coun-
try. They will be the dictators, the
commissars, the gauleiters, the fell
lows who put the squeeze on big
and little businessmen who want to
make little money.
FARM PRICES NOW
NEAR PARITY
If, on the other hand, all prices
were frozen as of some given date,
then no one could squaWk. Farm
prices are row lowering around
parity, and the relationship between
agricultural prices and industrial
prices is in general about what it
was in the good years, the almost
normal years of 1926 and 1887.
| Wages are better than in those years
and there is more employment.
Prices have advanced sufficiently to
stimulate production
With prices and wages frozen at
present levels, the function of the
Office of Price Administration would
be to grant price increases In specific
industries where relief was found
necessary. And it would be up to the
leaders in each line Of business to
prove the need for any upward re-
vision of prices before 1t could be
granted, instead of t'other way
around.