Toledo union journal. [volume] (Toledo, Ohio) 1942-current, 1948-01-30
SIiqhf Disagreement


There seems TO be a slight disagree
ment between what businessmen think
should be done in the way of preventing
a recession" or, as it is sometimes OlI'lV-
Iy called, depression.
Evidence of this difference was shown
in two reports which appeared in our
daily newspaper this week in which
banker addressing the Toledo Chapter, Ma
tional Council of Credit Men, predicted
moderate" decline starting next fall,
while local industrialist declared prOduc-
tion was the solution of initiation.
These statements at first glance may
not appear contradictory, but closer eX-
animation of the, thoughts of a banker
and industriaIist reveal that there IS
wide divergence in their opinions.
L. Merle Hostetler of the Federal Re-
serve Bank of Cleveland speaking here
before the credit men made two important
assertions:
1. The unit volume of retail trade is
running behind the volume of year ago,
with the decline since the holidays being
greater than usual.
2. The fact that large section of our
population gradually is being priced out
of the market
A completely opposite view was taken
by j. ID. Mooney, president of the WHY'S
Overland Motors, Inc, in a speech in
Youngstown on the same day. Said Mr..
Mooney:
''For everybody to have more, we have
TO get on with the job of making more.
There is no way to real wealth except
through production"
II may seem little difficult to recon-
cile the two points of view in the face of
the statement of a banker that unit sales
volume has diminished in the last year,
which would indicate growing inven-
tory of goods, and second positive state
ment that "a large section of our pOpula-
ton gradually is being priced out of the
market"
We believe, of course, that Mr.. Mooney
recognizes the problem in a somewhat
different fashion, for he also said that "lts
time for us TO take some Of the wood out
of the nickel" At the same time, we cam
not laugh off the words of the Cleveland
banker that an important segment of the
population cannot purchase at their cur
rent wages and salaries all the goods they
need and could use.
Obviously, production is only one
phase of the problem. The other parts are
composed of prices and wages which MIR.
Hostetler made very clear in his message
to the Toledo credit men.
OF what value is high production
when, as has so ably been pointed out by
no less an authority than a banker, the
production is being built up into an i'm
rreasng inventory because the people are
being priced out of the market.
Saying that large section of the peo-
pie are being priced out of the market is
but another way of saying that their i'm
comes are not sufficient TO make the pur-
chases which must be made il we wish
to maintain the high productivity which
Mr.. Mooney indicates we must have ii we
are going to wiring the water out of our
dollars.
With wages out of line, and we have
the word of a banker that they are, i'm
creased production for which MIR. Mooney
is clamOring becomes an instrument to
hasten the moderate recession which
has been predicted for next fall. Increased
production, which we agree is the way to
"real wealth" in the light of current
prices and wages, accelerateS the speed
with which we are travelling toward the
ultimate economic breakdown.
1t is refreshing to observe the search
ings which are going on in the ranks of
the business people and industrialiSts in
their cropping for the answer TO the prob
lens Of production, initiation, prices, and,
as a sort of an after thought to wages.
Perhaps they too will eventually be bright
enough TO see that the economic chain is
no stronger than its weakest link and that
wages cannot be the weakest link unless
we wish to court economic disaster.
The most intriguing argument advanced
the L1.A,l. -tra IL de-