Evening star., 1942-04-28
Cost of Livinq

SoSt VI ItNtn9
The Presidents message TO Con-
gress on stabilizing the cost OF living
represents by far the most realistic
attempt on the part Of this admins
tration to deal with the tremendous
problems raised by the Nations total
conversion to a wartime economy.
There is evidence in the message it
self, however, that a certain amount
OF wishful thinking still persists.
From the language OF the message
1t appears that the so-called selective
system OF price controls is to be
abandoned In favor OF a blanket cell
ing on virtually all prices. This is
certainly a proper move-one which
has been advocated from the begin
ming of the price-control effort by
advocates OF the "Baruch" plan. 1t
Is gratifying that the administration
has been won over to this viewpoint.
At the same time, however, it is
obvious that no price ceiling-of it
self-can be effective in stabilizing
living costs, and 1t Is for this reason
that the President, with other things,
has reopened the question of wages
and farm prices. With respect to the
latter, he has called upon Congress to
reverse its earlier action In prohibit
ing ceilings on farm commodities
under 110 per cent of parity, and to
enact legislation designed to insure
farmers parity prices and nothing
more. This is also an eminently
proper recommendation, but, when it
is appraised In the light of Mr..
Roosevelt's stand on wage controls,
its value as realistic step to ward
of imitation is open to question.
For, while correctly suggesting the
parity ceiling on farm prices, the
President fatty opposes any legis-
lative control of wages. express
ing the belief that they can be stabil-
lied through the machinery of the
War Labor Board, provided living
costs do not go up. At the same time
he says that this machinery for
adjusting labor disputes will, of
course, continue to give due consid-
Grafton to inequalities" Precisely
what Is meant by this is not clear,
but 1t suggests that the Labor Board
will be sympathetic to demands for
boosting wages in any given classifi-
cation to the top prevailing level, and
II that Is the case there may be
considerable overall advance 1t is
also worthy of note that the Presi-
dent restates his opposition to aboli-
tion of time and half for overtime
on the ground that this would reduce
the workers weekly pay envelopes
Considered by itself, the Presidents
position on these wage matters may
be defensible, but 1t should be recog-
nized that the wage question has a
very definite relationship to the other
items on the program-in a political
as well as an economic sense. Con-
gress, in effect, is asked to sanction
q program which would reduce the
level of income previously guaranteed
to the farmers, while maintaining
wages at the present level and pos
Nbly encouraging some increases
Theoretically, this may be proper,
but from the political standpoint it
seems unwise. II past experience in
this respect serves as a guide, Con-
greSS will not sanction a reduction
in farm income under the conditions
proves to be the case the dangerous
increase" in living costs which Mr..
Roosevelt anticipates for the average
family would become a reality. That,
in turn, could only be expected to
bring renewed and probably irreSiSt-
ible demands for higher wages, with
disastrous ultimate consequences for
an otherwise substantially sound
program.
The President advocates three
way approach to the problem OF
absorbing excessive buying power
Included are further curbs on credi,
and inStallment buying, more exten-
Sive purchases of war bonds and a
drastic tax program. There will be
general agreement with the substance
of these proposals. AS he indicates
the voluntary bond purchase plar
may have to be supplemented latel
by some system OF compulsory say.
ingS, but it may well be wise to give
the voluntary method further trial
Also in the dubious category Is tn,
proposal for S25 900 limitation OF
net incomes. This recommendation
can have little economic justification
for, as the President points out, tn,
number Of persons affected would b,
small, and the revenue to be raiset
through taxation, not an arbitrar,
limitation on income, is the objec
tive. The probability is that. tn
proposal Is designed to serve a psy
Geological or political purpose. bu
this Justification Is at best feebl
enc.
On the whole, however, the pres
entation of this program by tn
President is gratifying. Even thoug
It be deficient in some importan
respects, 1t nevertheless indicate