Detroit evening times. (Detroit, Mich) 1921-1958, 1944-05-11
Price FixiinQ
No Cure-A|I
By LEWIS HANEY

Professor of E,7uou ts. Sew yfrs 2. 7
The recent speech OF Chester
BoVlcS OPA head, advocating a
postwar extension OF price fixing
and general government control
over the economic life OF The ma
Uon should bc noted by an
All l.i+.4i. ~ - t,yti;t -
some ot the reasons Why the ar
gumcnts for broad prlCe-fXing
fan down
1 Il is argued that price-fiN
nI is necessary adjunct 20
ratioulug and prIoritieS This in
wolves a misunderstanding of the
IDEA al Fatieffffg. But m any case, 7
relatively few commodities arc
rationed, while the long list of
luXuricS and minor articles on
which prices are fixed by OPA ~
a Joke, including as II does, the
following bed socks, baby hlbs.
brains. burial cases. car food
caviar. castor oil. champagne
ground clam shells. horse and
mule collars hunting dccoyS, zee
cream dipperS. doughnutS. ear
mullS m b a m ing fluids and
equipment. ballet slippers, Hal
loWcen novelties. lecturers serv-
ices, liquor marionettes, mando-
Inns. church pewS. pipe cleaners,
reading racks. snuff ukuleleS,
pop corn. hair (eXcept washed
cattle and winter hog). bird
cages and houses, infants toilet
seats, and wild rabbit meat.
LISTS ARGUMENTS
2-It is argued that prices
should be held down by price
fixing during the war, until pro-
duction eventually increases. and
then the larger supply will keep
prices down.
But though il is possible that
in a few cases something of tins
sort might be true. in general the
idea is faiiacious. Such goods as
copper. lumber, and cotton tex
tiles are typical, and they show T
that in order TO get production
stepped up, it may be necessary /
TO allow prices to rise first The
incentive system is a great
reality.
We can't wait 10" discover the
few cases in which increased
may occur while prices
arc held down by price-fiXing
And att This says nothing Of the
effects of the price maladjuSt-
mentS that always attend price
fixing. causing confusion and re-
output.
CAN'T STOP INITIATION
3 It is argued that price-fiX-
ng can stop initiation - But this
is a doubly fallacious notion. First,
can't stop real prices
from rising, quality service, and !
black markets considered. Second
price-fixing. even if it froze prices.
would not stop imitation. Prices
may rise without imitation. and fall
without deflatlon. BY the same
token. imitation may exist without
rising prices az least i'm any or
binary sense. In 192S-29. COM
modify prices fell. while initiation
went on. Initiation in the shape of
excessive credit. may remain in
active as 10 prices for long time
LABOR INFLATED
In this connection. note two
points: the price of labor is now
highly inflated and the ratio OF
pay rolls TO employment is of rec
ord proportions: and the first I
effects of initiation on commodity
prices are usually seen in luXu-
ries. which are Just the goods that
all agree may be left to free
markets.
1T is argued that by govern
ment subsidies. prices can he
kept down. But this speciouS plea
10 saying that price ad-
vanceS can be concealed under
the guiSe of the taxes or public
debt from which the subsidies
would be paid II is proposed that
the government should pay pro-
ducers for not raising The prices
which they are paid by the people
whom the government represents.
HACRENSACK WATER co.