Imperial Valley press., 1945-02-13
LOW-PRICE POLICY
ON HOUSING, JOBS
(New York TimeS)

N4N6N l tIh lliltSJ
Large volume housing is given an i'm
portant role in all programs designed
to provide high-level employment after
the war In hearings before the Senate
subcommittee on Postwar Economic
Policy, spokesmen for the AFL and the
CIO have called for the construction of
a minimum of million and half dwell
ing units year, or about five times the
construction rate before the war. Such
a program would furnish employment
for about six and half million persons.
A market for this large volume of homes
could be provided only if the price is low
enough to reach the pocketbooks of low
and moderate income groups. This OBJ
jective could be achieved either by low
ering the price through lower costs of
production, or by government subsidy to
bring the high prices dictated by high
costs in line with the consumers pocket
book
The cost of residential construction
is usually divided about 35 per cent for
labor and 65 per cent for materials. Large
reductions in both of these costs are pos
sible. Labor practices in the building in
dustry have been characterized to a large
extent by the ''make-work" fallacy.
archaeological developments in building
have been opposed on the ground that a
displacement of labor would result. Boris
Shishkin, AFL economist, furnishes
typical illustration of this attitude in his
statement to the Senate committee that
important cost economies could not be
effected by prefabrication. 1t would be
very unusual if the application of mass
production techniques did not result in
large savings in costs and hence make
il possible to lower prices substantially.
The relatively high level of building
material costs under the present struc-
ture of the industry has provoked an in
structive comparison by DR.. E. G. Nourse
of the Brookings Institution, in his study,
price Making in Democracy: "lf
metal, rubber, plastics and upholstery
fabricated into automobiles sold on the
same level that they do in bathroom and
kitchen fixtures and living, dining and
bedroom suites, the automobile would
still be a luxury article" DR.. Nourse
vigorously espouses the philosophy of
low prices as a means of passing on to
consumers the benefits of technology and
of achieving full-scale national produc-
tion under private enterprise. Housing
is an area of the economy in which this
low-price philosophy could prove fruit
full, just as it has with the automobile.
Unless low-price policies are adopted
and all barriers to the lowering of costs,
whether erected by labor or producers of
materials or by Government (for exam
pie, through obsolete building codes) are
swept aside, large-scale subsidies will be-
required if volume is to be attained. In
fact, such subsidies already are being
advocated by some groups. This devel-
opment is in line with the present nation
al habit of turning to additional Govern
ment spending as the solution for nearly
every anticipated postwar difficulty.
Some Government subsidies may be nee
essary to provide adequate housing for
the lowest-income groups, but the need
for such subsidies can be obviated for
other groups if we remove the many
restrictions which now stand in the way
Of reducing costs and prices to the level
where mass markets can be reached