Milford chronicle., 1949-04-01
HIGH PRICES-SMALL PROFITS

Do high prices necessarily mean big prof
its for business? The answer to the question,
curiously enough, is no.
A recent Ap survey of the financial ex-
perience of some leading meat packers last
year Substantiates that. During 1948 meat
prices reached point which resulted in con-
sumer protests being heard in Yising volume
from one end of the country to the other.
Yet one of the major packers had its first
operating loss since 1888, which was de-
preston year. Another lost money on its
sales of meat, but managed to make up the
deficit in other lines of activities. A third
made profit which worked out to one-quar-
ter of a cent per pound on the meat it hand
led.
The packer which took loss, incidentally,
did gross business of nearly $4,000 100000,
which is certainly an astronomical sum. But,
when the books were balanced at the end of
the year, the company was about $2,OO0OOO
in the red.
Here is perfect example of how the free
enterprise system, with its roots in supply
and demand, works. In the case of meat
there was a slackening of demand as 1913
neared its end, and prices sagged. Packers
had supplies on hand which had to be moved,
whether or not the price the public would pay
was profitable. In a competitive economy,
risk is an inescapable part of any business
enterprise, and man who makes million
one year may lose it the next. Even under
the most favorable experience there are many
industries, of which meat is one, whose
profits are so small as to have no appreciable
effect on the price paid by consumers fol
their products.
The packers experience provides proof o1
still another vital fact. Where free enter
prise prevails, no business, no matter how
large can control" prices. 1t can't make
people buy its wares if they don't want to.
N~S@N~%
MORE CLASS LEGISLATION
The Federal minimum wage and hou
law, as laid down in the Fair Labor Stand
ards Act, has always contained certain ex
ceptions and exemptions. One exemption
applied to retail trade for the very SCUM
reason that this enterprise has various job
which are suited to beginners, young people
and totally unskilled labor, and which do nc
justify higher rates of pay.
Under the revised version of the Act, a
approved by the House Labor COMMITTEES
the retail sales exemption would be restrict
ed to employers whose total volume of sale
does not exceed $500,000.
This change is much more important tha
may be generally realized. First of all, it
definitely class legislation. 1t says, in effec
that smaller stores need not pay the Feder;
minimum wage, out tnaC larger stores mus
The dividing line is purely arbitrary, an
without basis in reason. Stores operatin
side by side, on the same street in the san
town, would have a different standing
law.
Secondly, it is entirely possible that tn
PROFESSIONALISM coupled with high min
mum wage-would produce unemploymer
If a store were forced to pay Is cents
hour for inefficient, unframed help, it won
naturally seek ways and means to redu
the number of people on the payroll. T.
cost of labor is heavy factor in retail bu'
ness. 1t has, as we all know, done much
force commodity prices up. The pending Ia
might very well destroy opportunity for
marginal worker.
In any event, fair labor standards shou
apply with equal force to all the elemer
within any given industry and region.
single out either large business or SIN