| Show Inflation Threat Will Become a Dread Reality If Everyone Scrambles for Excessive Profits Wages V 10 1 Only Controls of OP OPA A t Prevented Runaway Prices Aces During War By WALTER VALTER A. A SHEAD I WN U Staff starr Correspondent During the war years if it we became became became be be- came peeved pee with rationing and price control it was the national habit hab hab- it to cuss OPA During sion people from the captains of industry on down the line and into the ranks of congress blame many of our ills on OPA There have been ridiculous and oft- oft time funny jokes cracked about the theOPA theOPA theOPA OPA and the controls instituted for forthe forthe forthe the protection of the American peo peo- pie And as Is the case in any human human human hu hu- hu- hu man institution the OPA has made mistakes errors of judgment Congress has been deluged with letters from constituents business businessmen men and consumers concerning real or fancied ills and discriminations discriminations t which were laid at the door of the Office of Price Administration And congressmen being human too I let the blame rest on OPA passing the buck along But despite all this criticism despite verbal beatings which tore to shreds the actions and I policies of OPA CPA congress dared not eliminate the agency despite strong pressure and by an overwhelming ti I majority voted to continue OPA CPA and the price control policy until next June And every poll taken of the American people showed despite their their sound common common common com com- mon sense prevailed and 75 out of every people favor continuing price controls for at least some months to come Only in recent weeks various groups in trade and industry have been increasing pressure in calling for an end of ot price controls particularly particularly particularly t L In the building and housing Industry Industry in industry In- In preferring to let prices find their own level le As a matter of fact and record had it not been for the OPA CPA and the I policies of rationing and price control control control con con- the American people would never have been in the favorable position they are in today to face whatever may come in these months of growing pains For price controls have held the line against Inflation and rationing controls controls con- con troIs have seen this country the best J fed in its history Most folks dont don't understand inflation inOa- inOa tion and what it means but most people do understand and resent and andt t fear high prices The records show I 7 7 that every major war in which the e nation has been engaged has been 1918 1919 1920 1921 1 r F K r rw w p ti a j r I 1 FARM ARM r a. a CUT IN Iw HALF c SJ a pARME FARMER LOT tHEIR LAND i i r During World War I prices rose swiftly After the armistice on November November No No- vember 11 1918 there was a sudden dip lasting only three months Then the upsweep was resumed soaring until midyear of 1920 The price level more than doubled between 1917 and 1920 When prices broke Inthe in inthe inthe the later months of ot 1920 a toboggan slide began that brought ruin to millions that the general level of price fluctuation remains steady Farming has become one of these specialized industries relatively and a great many of the things used on the farm and in the farm home are purchased Too many farm investments in investments investments in- in vestments and obligations incident to the farm business are long term obligations and so the behavior of the price level means much to farm farm- ers For Instance I was talking to toa toa toa a Pennsylvania dairy farmer in Washington recently He lives in inthe inthe inthe the potato country of Pennsylvania and when I asked him how his potato crop was he said Well I didn't plant any I figured my business is dairying and I let the potato farmers raise potatoes What Is inflation There are many long and technical answers to that question But about the simplest answer this writer can find is that it is a situation which creates an I unfair change in the purchasing power pow pow- er of money monc For instance a farmer who borrowed borrowed borrowed bor bor- rowed some money in 1913 could ha have ve taken 5 of that tha t borrowed money money money mon mon- ey and bought 40 pounds of meat pounds of flour 91 pounds of sugar or 77 yards of gingham If he paid back that loan in 1920 during during during dur dur- ing the period of inflation the lender could have taken the same 5 and HOLDING HOLDING THE PRICE LINE LINEON L i 0 9 f- f I i V G c o o Gt pF o I io 0 o 0 o 0 o 0 ft w o ON N THE THINGS YOU BUY o 0 t Gel I j s do ro c 0 rs I off V-S- V b Stable prices for farm tarm products are best for tor the farmer Any temporary temporary tem tern profits he might make through rising prices would be eaten up by I. I the increasing cost of manufactured things that he has to buy accompanied or followed by a major major major ma ma- jor inflation followed by deflation of equal proportions Rise Held to 29 Per Cent And for the first time in our nations nation's nations nation's nations nation's na na- tion's history thanks to OPA CPA the cost of living during and immediately immediately immediately immedi immedi- following this war has been held fairly steady From the outbreak outbreak outbreak out out- break of the war to the end of 1944 living costs as measured by the bureau bureau bureau bu bu- bu- bu reau of labor statistics rose less than 29 per cent and most of that rise came before May 1943 when teeth were inserted into the price stabilization program By compari compari- comparison son lon living costs rose more than 84 per cent In a like period after the outbreak of the First World war when there was no rationing or price control Labor unions declare 4 the rise in the cost of living has increased increased in in- J creased more than 29 per cent 1 reaching a 40 per cent figure but even so if it that is true it does not reach the dazzling heights to which I living costs went after the last war Farmers because of the nature of their business suffer more moret t i than any other group from In Inflation inflation atlon a- a tion and the crash which inevitablY inevitably H follows As a matter of fact it makes little difference I what the price level may be so as S It remains stable and assuming that the Incomes to the various occupational groups are arc fair and equitable The more specialized and the themore themore themore more commercialized the business busts bust busi s ness Is the more desirable it Is Is' bought only 21 pounds of meat 62 pounds of flour 26 pounds of sugar or 23 yards of gingham The borrower borrower borrower bor bor- rower returned ed the same number of dollars but he did not return the same amount of purchasing power H Million Farms Lost Inflation during and following the thelast thelast thelast last war lost to the farmers of this country approximately a million and a half halt farms Why Because prosperous farmers during the war invested their money in land at inflated inflated in in- hated prices They went into debt f for r machinery for homes barns and other commodities at inflated prices Then the purchasing power of the dollar changed and the deflation deflation deflation tion which followed the inflated ted values values values val val- ues brought about the inevitable crash Chester Bowles the boss of ot the theOPA theOPA theOPA OPA Is a business man He was the head of a large advertising agency agency agency agen agen- cy which was In daily dally contact with big business So he knows big business business bustness busi bust ness practices and he has become the rock upon which the pressure groups are dashing themselves in an effort to break price control Chester Bowles has taken his stand against price inflation and for price control because his office is flooded with hundreds of ot letters every every every ev ev- ery week weck testifying to the fear with which people view inflation or high prices and these letters come from big and little people alike from farmers workers housewives consumers small business men One theme predominates they want to be assured that the cost of living or the cost of operating a farm or ora ora r ra a business will not be permitted to togo togo togo go up into an Inflation spiral They want price controls continued for the present All three of the major national farm organizations have strongly supported the price control pro pro- gram Labor organizations too have given unstinting support The farmers in the older age brackets do donot donot donot not easily forget what happened when what few controls existed were dropped shortly after the armistice in the last war At first prices slumped rather sharply in some commodities but within a few months after and workers returned to their jobs in peacetime plants the downward trend was reversed and within seven seven seven sev sev- en months the inflation boom was in full swing Prices rose skyward manufacturers wholesalers and retailers retailers retailers re re- were forced into a wild scramble for inventories Prices soared higher and higher Farm prices skyrocketed per cent between between between be be- tween 1914 and 1920 If farmers merchants manufacturers manufacturers manufacturers can be certain that the costs of things they buy will not skyrocket and threaten a major crash later they can make term long-term plans for scale large-scale operations and production production production tion and full employment If U workers work work- ers can be certain of this full employment employment em em- nt at adequate wages then they also can feel secure of the value of their purchasing power will feel free to spend for sion goods and this free spending will stimulate more employment Farm and City Linked On the other hand if swiftly rising rising rising ris ris- ris- ris I ing prices make production costs unpredictable unpredictable unpredictable un un- predictable business will not be able or willing to plan ahead full production production production tion will falter and fear of unemployment unemployment unemployment would make consumers afraid to spend We have often remarked remarked remarked re re- re- re marked about the relation relation relation rela rela- tion between the farmers' farmers income and full employment in fn cities for forit forit forit it is a fact that when income of workers workers workers work work- ers is high farm income also is high When there is heavy unemployment unemployment unemployment farm prices toboggan Price Administrator Bowles has given his word that OPA CPA is going to use every resource at its command to continue an effective job with the ultimate goal of keeping a sound price structure upon which can be built sound prosperity When danger danger danger dan dan- ger of Inflation is past then OPA plans to step out of the picture The present act ends June 30 1946 To Todo Todo Todo do this he plans 1 wherever necessary necessary necessary sary to continue price controls over goods and services which have been controlled in war time 2 to set prices on goods 3 j to work out simple dollar cents ceiling prices for building materials and as many consumer goods items as possible 4 to require manufacturers manufacturers manufacturers to tag consumer goods with to read retail ceiling prices I Continued control over tractors other farm implements and machinery machin machin- ery fertilizer and seeds so long longas as they are arc In short supply is on the program It may be ne necessary essary to increase some prices as compared to prewar but the plan is to keep all prices as near prewar level as possible Bowles says that price control alone cannot guarantee prosperity but he believes that it can help to control inflation by keeping the buyIng buying buy buy- Ing power of each dollar and will enable industry agriculture and la- la labor labor la bor together with government to work together toward a sound postwar postwar postwar post post- war prosperity I STABLE PRICES I r S ENCOURAGE STEADY BUYING 0 THAT MAKESs MAKES s STEADY TEADY JOBS FOR MAKE GOOD OD MARKETS INDUSTRIAL WORKERS FOR FARM PRODUCTS I Io o 0 th J tJ I 1 f i j. j |
