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Show 7 PUBLISHED EVERY SATURDAY BY QOODWIN8 WEEKLY PUBLISHING CO, INC. W. E. CHAMBERLIN, Buslnesa Mgr. F. P. GALLAGHER, Editor and Manager. SUBSCRIPTION PRICE: Including postage In the United States, Canada and Mexico $2.00 per year, $1.25 for six months. Subscriptions to all foreign countries, within the Postal Union, $3.50 per year. Single copies, 6 cents. Payment should be made by Check, Money Order or Registered Letter, payable to j Thp Citizen. Address all communications to The Citizen. Entered as second-clas- s matter, June 21, 1919, at the Postofflce at 8alt Lake Act of March 3, 1879. City, Utah, under the Phone Wasatch 5409. 311-121- 3 Ness Bldg. Salt Lake City, Utah. . GENERAL WAR ON PRICES MAKES PROGRESS of the remedies proposed for the high cost of living is It is pointed out that if we cannot reduce prices by various piecemeal methods we can effect a general reduction by making money, worth more. If we increase the purchasing power of ONE money prices are thereby reduced. There are two methods by which inflation can be brought to an end. We can, as did the Russians, increase the issue of unsecured currency without stint or limit until it ceases to have purchasing power in other words, wipe out the value of all unsecured paper money and place the nation on a strict gold and silver basis. As there would not be a tithe of the necessary amount of coin in circulation the business of the country would be ruined and men would be compelled to resort to the old method of barter and trade. The other method is the gradual, scientific contraction of the circulating medium or debt that has been created to meet the exigencies of war and wars aftermath. It is by this method that the proponents of deflation in Washington plan to increase the purchasing price of the dollar and thus lower prices. The danger of deflation lies in its disturbance of business and the creating of alarm and finally of a panic. The effect of a panic is much the same as the effect of wiping out all the unsecured currency of a country. Credit, which operates by means of checks and bills of exchange, is contracted to such an extent that business is 'crippled and only those who have gold and silver are able to transact business. It must remain vividly in the recollection of most of us that dur-in- g the panic of 1907 some of the countrys biggest business concerns went into the hands of receivers because of the contraction of credit. Supplied with credit, these firms could have escaped insolvency, but denied credit they were unable to continue their business. A number of these firms quickly came out from under the receiverships as soon as the panic had passed. They resumed business and have con- day when he must sell at low prices the goods purchased on a rising market. How many of our merchants have displayed this wisdom? If deflation should come with more or less suddenness how many would have a surplus to take up the slack ? Even merchants who commonly are accounted wise have convinced themselves that prices have reached a new high level and never will return to the old basis despite deflation and all other methods government can adopt to reduce prices. Commercially Russia has been ruined and must start all over again, but there is no question of ultimate insolvency. No nation has superior natural resources. Given a stable government and secure trade conditions, Russia could recover more quickly than any other nation except for one factor lack of business ability. There is no danger that we shall come to the Russian condition of commercial debasement by the process of making our unsecured currency worthless, but there is a period in deflation. It must be so gradual that business will not be broken by the shock of landing. In fact, the illusion must be kept up that there is to be no landing. The dropping down must be so easy and pleasant that business will not take alarm and jump overboard in a panic. High prices stimulate production, low prices discourage production. At a time when production throughout the world is reduced as little wars a result of one big war which has ended and twenty-on- e which are in progress the prime necessity is increased production. We must take this necessity into account whenever we are devising plans to lower prices. What we really wish to accomplish is to put an end to profiteering and to reduce the costs of production so that of war. We can, perhaps, eliminate profiteering by stringent laws, but we cannot reduce prices by decreasing production. Here is a dilemma which will create much pessimism. How can we increase production at the same time that we are offering lower prices? During the war production was stimulated by increasing prices. And now we are tinued to make profits ever since. to keep production up to the high level resulting from stimuhoping exercise the must utmost If deflation is attempted, therefore, we lation and yet lower prices. economic wisdom to let ourselves down as easily as possible. It is Those who have seen the packing trust and other combines much like landing from an airplane. If the landing is made too speed-il- y set aside the law of supply and demand think that the government can there is a smashup. easily solve this problem. If trusts can obtain high prices, whether The wise merchant, as soon as he discerns that prices arc rising supply be greater or less, why cannot the government lower prices to a new level, makes provision for the day when the leveling down- no matter what the supply or the demand? The government must deal with the production of raw materials, ward shall begin; When prices rise he sells his old stock purchased The trusts, for cheaply at an inflated profit, but he sets aside a surplus against the with the foodstuffs as they come from the ground. -- |