Milford chronicle., 1955-01-14
REGULATION DOESN'T MEAN
ADMINISTRATION

acJlNlklGS until Tie OIlBlIldl IpOoC 4OI /
which it was created may be lost sight OF.
The Interstate Commerce Commission
Act was passed in the 1905 to prevent
mOnopolistic practices by railroads, to see
that charges were reasonable and just and
to correct and prevent discriminatory rates.
Thus did the ICC come into being.
Any railroad monopoly that may have
existed Is years ago has long since been
done away with by new forms of cOmpeti-
tiOn on waterways, highways and in the air.
All are regulated to a greater or lesser de-
gree by government The railroads. how
ever, which are the backbone of our trans
portatiOn system, are handicapped by red
tape and regulation which was designed to
meet conditions when railroads had no COM
petition.
Now public regulatory bodies seem to
give more thought to protecting carriers
from competing with each other than they
do to allowing them leeWay to offer the
public services and rates on competitive
basis.
Thus have we seen a government regula-
tory agency expand its functions until today
it has virtually assumed the management of
the nations transportation systems with
out facing the burden of financial response
bility for their success.
If our regulatory bodies would cOnfine
themselves to giving equal treatment to all
carriers, instead of trying to manage the
details of their operations, the public would
be assured of the best at the lowest rates.
Regulation of business does not and should
not. be construed to mean administration
and management Of business.
"REAL COST is THE BIG THING
The number of dollars or pounds or rubles
or
in itself important. What is important is
what they will buy. Thus, the price charged
for any commodity should be measured by
what is known as "real cOst'-that is, the
amount of time that must be worked to earn
enough to buy it. A recent comparison, baS-
ed on Bureau of Labor Statistics, on "real
costs" in the two netrOpOlises of Moscow and
New York City, lis striking and important
In Russia, all the means of production and
distribution, with few unimpOrtant excep-
tions, are state-OWned. There is no cOmpe-
titiOn, in any recognized sense of the word,
on either the manufacturing or retailing
level. In this country, by contrast, factories
are free to produce what they think the
people want, stores are free to stock it, there
is intense competition all along the line, and
/ the consumer has complete freedom of
choice.
How do the two diverse systems compare,
in actual physical results? In Moscow, the
average worker must work 1T minutes to
earn the money to buy a pound of choice
+ beef and 168 minutes in the case of a dozen
/ eggs-in New York the figures are % min
| utes and 81 minutes. In Moscow, the worker
must put in AZ days of time to get enough
money for an OvercOat and 80 days for a
table model radiQ-in New York the respec-
tive figures are days and Is hours. The
difference is similarly great with other foods
and products. You might keep this in minC
next time you go shopping-and mentally
give free enterprise a little of the credit il
deserves.
THE CASE AGAINST REINSURANCE
The proposal for government reinsurance
of the voluntary health insurance plans is
due to come before Congress again. Ii has
many sincere advocates But the perils anC
weaknesses implicit in it should be thor
oughly understood.
First of all, the phenomenal progress
made by the health insurance industry makes
federal Intervention unnecessary as well Al
dangerous.
Second, reinsurance would not maxi
health insurance available to more people o
extend the benefits unless it were accom-
panied by heavy tax subsidy to make pOss
ible selling the insurance for less than tn
cost of servicing the contracts.
Third, insurance authorities seem gen
orally agreed that the extent of health in
surance liability is such that there is absC
lutely no need for reinsurance.
, Fourth, the program would give govern
ment sweeping and unjustiied regulator
control over the health insurance industry.
Fifth, many believe that reinsuranc
might prove the entering wedge to sOcialize
or gOvernment-dOminate medicine.
The last Congress refused to approve tn
plan. The new Congress should follow ths
wise precedent
5000
TRULY REVOLUTIONARY"
A report issued by a New York bank ha
something important to say about retailing
I in this country.
'Since prewar 1885," it observes. eth
changes in retailing have been truly revolu
? tiOnary as a result of merchants efforts t.
: hold down selling prices in the face of risin