Imperial Valley press., 1942-02-01
CAPITAL TALKS
by
Peter
Edison

WASHINGTON. Jan. 81. tUP>-
Is the new price bill. born OF four
months congressional strife and
strain. a dead duck before 1t even
has a chance to try its wings and
show its Stuffing?
Capital advocates OF the Bernard
Baruch theory OF freezing all prices
instead of selected prices, tear that
ii Is. Their reasoning is that prices
have risen 50 much faster since
Pearl Harbor than they did in the
proceeding Is months that the only
way initiation can be prevented now
is through a much more drastic
freezing of all prices than is call
ed for by the administrations pro-
gram of freezing only selected
prices.
Before Pearl Harbor, whole
sale prices were advancing at
the rate of about IL per cent
a month. In the first month al
ter Pearl Harbor the rise was
8 per cent and in one week 1t
was l per cent. Increases on
the main items-food. turni-
ture and clothes average
about Is per cent over the past
year. but all items are up.
Wholesale prices on farm pro
ducts have gone up over S5
Der cent and on foodstuffS Ov-
er 25 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 we'll Tor 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 advanc-
ing 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 up
ward to initiation.
OF course it's nice to have eV-
eryone getting a little more jack
regardless of whether it comes in
as wages or profits on d sale. The
grief in this particular situation
S that higher paychecks and big
ger sales slips don't produce any
more r1unitions-they make just
the same quantity of battleshlps,
bavonetS or buttons cost more
money which can come only from
higher taxes and bigger debts,
There is nothing new in that state
ment. It is so old now that 1t
should be public axiom number one,
But it apparently can't be repeat
| I'd 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 provisions of the
new price administration law.
1t may take the Price Admin
istration too long to swing IN
to action, it may mean that an
organization can't be whipped
into shape fast enough to han
/
ton.
Up to the time the price bill was
passed. Price Administrator Leon
Henderson organization had Is
sued only about rs price sched-
ules. nearly all covering materials
going into war production. Two
thirds of the principal commodities
! Of general trade are still uncoY-
cred.
Perhaps the Office Of Price
Administration has felt that
ii should go little slow in
plastering price ceilings on
these walls of rising prices till
after the new price bill was
passed. UnquestiOnably, Hen
derson's 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 50
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 aa Of
some given date. When this price
! bill goes into effect. Leon Hender-
son and all his thousands of Price
Administrator employees are going
TO be the most unpopular people in
the country. They will be the dlcta-
tors. the commissarS, the gau!el-
ters. the follows who put the
squeeze on big and little business
men who want to make a A,'lc
money.