The midland journal., 1946-09-20
News 6;|
Behind, 80, 60
THFNE!'lWI|l;SS5EE51 E!'lI|l;S5E5
neieaseo py Western newspaper Union.
ANOTHER WAGE BOOST JUST
BEFORE ELECTION PREDICTED

ANOTHER WAGE BOOST JUST
BEFORE ELECTION PREDICTED
WASHINGTON. - The middle
road course of economics to which
the Truman administration has
veered since congress closed has a
sharp left turn ahead. Watch for
another wage increase program to
be put forth within go days-before
election!
This is augured behind the recent
price increases directed by the
Price Decontrol board. While price
controls have been restored on
meat, subsidies have been aban-
doned on dairy proceeds; coffee is
up 10 to 13 cents pound; mechan-
ical refrigerators, $40 to $12 for
smallest sizes; canned fruit, to 7
cents; lamb, 5 cents automobiles,
margarine, trucks, tires, oil, cot
ton-whatnot
Now the decOntrOl board went
on the air after its first action
and pleaded it could not have
been done otherwise. This was
the intent of congress in the new
OPA law, it claimed too glibly.
Indeed, Agriculture Secretary
Anderson publicly mOurned
some of the OPA necessities,
and OPA Administrator Paul
Porter wept officially about 9TH
ers. The administration atti-
tude on prices has been: "G0sh,
how we hate to increase them,
but congress made u.s."
After all. official handkerchiefs
are filled and hung out for public
drying, however, the administration
seems far from detected at the
hope that the price increases will
get production necessary to sustain
lfe-which was the real intent of
congress.
WAIT AND SEE TACTICS
Crowding the mourners' bench, the
C1O reconnoitered it's economics
and decided ostensibly to wait to
see how these things work out be-
fore pressing demands for another
wage hike. That is, all did except
ing the largest CIO union, the auto
workers, who announced they want
ed more money, the amount "de-
pending on the success the Tru-
man administration meets in it's at
tempt to roll back the cost of liv-
ing"
These developments are political,
but not in any way economic. The
theory of the price increases is that
these will draw goods from hiding
and black markets and thus cause
prices to drop in the end-the end
being forecast as coming when the
goods come out to the public. This
is sound, because as soon as COM
petition is restored in goods, they
are bound to be cheaper. The auto
workers therefore are trying to
crowd the game again by putting
in for another raise before the price
increases have accomplished price
decreases, an economic stratagem
which would leave their wages up
as prices fell later (as they already
had 20 per cent wage increase
this spring and auto production still
lags).
Furthermore, there is no short
age of money among consumers
today. We have many troubles,
but purchasing power is not one
of them. To increase wages
again this year (as the leftists
of the administration want)
might or might not help to
cause an administration victory
at the polls in November, but
there is certainly no other eco
nomic justification for it.
Our trouble has been a lack Of
production, a shortage of goods
amidst plentiful purchasing power.
II we got production, the very ac-
complishing of the fact would do
more to hold prices down than the
administration can do with OPA,
decontrols or possibly a shotgun.
When you can buy cheaper across
the street, you will not pay demand
ed prices.
INFLATIONARY STEP
But to increase wages generally
again would only let US leap further
along the infiationary road we
have been perilously travelling. It
would re-duplicate the experience
earlier this year, when the auto
workers first got wage increase
which forced price increase. re-
sulting now in their effort to seek
another wage increase which will
cause another price increase, and so
on-a process in which labor never
catches up but destroys the value
Of its own wage. In that process
the unions can destroy themselves,
making their own dollars which
they have stored up in large re-
serves of government bonds or cash
or the savings of the individual
worker-worth less and less in pur-
chasing power, and finally worth
nothing.
Far wiser would it be for la
Dor to attack the price problem
by going to work and producing.