The midland journal., 1946-09-06

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Behind, D. D., -
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CLOS WAGE BOOST POLICY
FORCES INITIATION ON US
By Paul MALLON

CLOS WAGE BOOST POLICY
FORCES INITIATION ON US
WASHINGTON. - Phil Murray
called in his CIO union directors
for what was supposed to be a re-
planning of the economic, if not the
political line-and who would not?
The news behind the news is be-
coming so plain it is beginning to
show through. The transparency of
recent events has been rather OBJ
vious.
Consider, for no more than a few
moments, the salient news of the
day upon which the CIO directors
were gathering together their be-
longings to attend the supposed re-
planning. The Packard Motor COM
pany reported it's first half-year re-
suits upon that day. AS CIO is pri-
marily an auto workers union, no
report could be more important for
Mr.. Murray's consideration. It
showed this:
Packard netted a loss on OPP
erations the first six months Of
this year of exactly $3.50, ,158.
Last year it earned $1,O64, ,450 in
the same period. The loss this
year was attributed by the COM
pany to the auto and steel
strikes for higher wages lin
creases were granted to the ex-
tent of about 20 per cent?. Pack
ard was typical of the motor
and steel industries. Thus
under ordinary circumstances
you would expect depression,
or recession, or at the very least
certain strongly deteriorating
economic consequences to flow
from losses.
DREW ON RESERVES
These were avoided because the
company used it's reconversion
funds and reserves to hold it's final
net profits at or near the usual fig
ure. If dividends had been cut, the
amount of money going out to stock
holders would be less, and conse-
quently there would be that much
less to be spent in the flow of the
economy. The companies, then,
have paid great sums for the
strikes, mostly from their reserves
and funds, but the economic conse-
quences of the strikes have luckily
been avoided because they had
this money available.
But on the very day preceding
the f0regathering of the CLIO
leaders, the OPA announced a
price increase for automobiles,
on the apparent ground that
the companies could not be ex-
pected to make money at the
old prices in view of the in
creased cost of labor, materials
and what not. The prices of
Packard were increased more
than the average. It's cheapest
car was moved up in the list
price from 81 $40 to 81 ,624 (about
STA, or rs per cent?, while its
highest list price auto was
jumped from $2,654 to S2,863
(S2O9, which is about 7.9 per
cent?.
Here then is where we are. No
ledgerdemain (and I do mean
ledger) is necessary to figure it out.
Several price increases have al
ready been granted. Another is re-
ported to be in prospect, although
I do not have any information con-
corning that. The forces of infia-
tion are so strongly and unmis-
takably at work no one can pre-
tend to avoid or ignore them. But
Packard stock is still selling
around SO which is hardly in
fiationary. We have had strikes,
losses, have eaten up reserves,
have increased costs of materials
and workmanship, have held some
lines, and some of the CIO lead
ers have thought the way out is to
start the thing all over again with
more strikes for another wage in
crease, which will help force an
other price increase - a process
which would surely be ruinous be-
cause it would spread economic
waste as if by whirlwind.
CONTRAST WITH RUSSIA
The AFL could give the CIO
bosses some interesting infor-
nation which should serve as
warning. The Labor Monthly
Survey for August has collect
ed recent news reports,
penetrating the Russian GEN.
sorship, and shows these facts:
Average wage in a Stalingrad
steel plant as late as this July
was S64 a month and in a trac-
tor factory $82 a month. The
AFL composer of that collection