Evening star., 1945-10-30
CIOChief's S Statement
Called challenging
Writer Weighs Relationship of
Surpluses and Take Home Pay

Writer Weighs Relationship of
Surpluses and Take.Home Pay
BY Dapid Laurence
Philip Murray. head of the CIO, in
his luncheon conference here with a
group of writer's and radio commenta-
tors. made challenging statement when
he said industry could afford a 30 per
cent wage increase without any mate
rial changes in the price level.
Mr.. Murray reached this conclusion
because Of the savings to business which
he says are coming as result of the
repeal of excess profits taxes, as result
Of chronological improvements during
the war period and as result of in
creased efaciency in production.
II industry doesn't grant the wage
increases, he thinks that the Nation
might witness a $35, 900 ,o0o,oo cut in
wages to the workers through the 40
hour week and other readjustments in
the reconyersion period. This, he be-
lieves, may present tragic forerunner
to depression.
The head of the CIO is an earnest,
sincere person who believes explicitly
In the doctrine which he expounds. He
is firmly convinced that industry should
take chances at this time and plan on
q larger wage payment to workers, know
ing full we'll, as he sees it, that even
tually the increased purchasing power
OF the workers would maintain salts
factory market for the Nations pro-
duction.
May Meet Half Way.
Undoubtedly, there is a relationship
between the prosperity of the country in
the year 1916 and the amount of wages
paid to the workers. If the cut in take
home pay is drastic, there will be
defiationary trend which may effect the
total volume of goods sold. Industry.
however, is said to recognize this possi-
bility and in many instances there have
already been offers of 10 or IS per cent
increases. In other words, there is an
inclination in certain industries and
businesses to meet labor's demand half
way.
Mr.. Murray thinks the findings of the
staff of the Reconversion Board, which
says a "a per cent wage increase might,
under certain circumstances, be possible.
ought to be made public. Clearly what
Is needed is more and more factual in
formation to enable impartial judgments
to he formed, for it is apparent that
some labor chieftains know there is a
point beyond which it is dangerous to
go in forcing wage demands just as man.
agement knows there's a point beyond
which its is unwise to go in refusing
justified demands.
But in the coming debate it is i'm
portant that timing be borne in mind.
Mr.. Murray speaks of profits that in
dustry will make when the excess
profits taxes are repealed, but who will
| guarantee the same volume in 1916 as
in l945, when war orders filled up our
| productive capacity to the limit?
/ 1t is often overlooked that corpora
/ ton taxes are not paid during the cur
| rent year, but a year later. Thus the
repeal of the excess profits taxes is
effective January /. 1916, yet not until
| March. 1947 is the first installment
due on 1946 earnings. Management
fears it is a little bit early, therefore.
to begin spending l94s earnings in
wage increases that 60 far beyond the
| expected volume of business that can
be safely counted on for the operations
of the year 1916.
| Question Of Surpluses.
| President Truman urged industry
and business recently to take chance
and forego initial profits so as to main
tain purchasing power, and Mr.. Murray
| applies the same reasoning. The difi-
| Guilty is that the we'll established COM
panies might take the chances, but ths
| newcomers in business are not SO for
| tunate. They do not have the ac-
cumulated surpluses available out Of
which to take such chances, and yet
they must under Our free competitive
| system price their articles or commodi-
ties on the same level or even lower
than those Of their competitors.
1t may be possible in particular in
dustries to use 80 per cent or some
other percentage as a method of cal
culating the increases IN basic pay
needed to avoid losses In take home
pay. but anything like a uniform or
blanket application of the figure could
prove disastrous. The marginal busi-
nesses which came into being during
the war, and can give employment, can
very readily be forced out of the run
ming by being asked to compete with
the larger enterprises which might well
afford as much as 80 per cent.
If ever there was q need for a ma
tional accounting system which could
reveal to the public the cause and effect
Of changes in prices and wage rates
on the volume of goods bought and sold,
it certainly seems that the present is
such time. Maybe that was what the
full employment" bill could do pro-
vided 1t is stripped of any efforts to
guarantee employment. For it is As
Impractical to do this under a system
Of private initiative and risk capital as
1t is to guarantee profits
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