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Show FISHER REVIEWS " COST LIVING Public Looking to Hoover to Remedy Evils and Fix Prices. 1 GENERAL PRICE LEVEL Price Fixing Does Not Solve Great Problem Has Been Failure Abroad. BERKELEY, Cal., Oct. 10 Irving Fisher's fifth cost of living lectures today to-day was on "Remedies." He said, in part: ' Mr. Hoover and Price Fixing." "At present the public is looking to Mr. Hoover for a remedy for the high cost of living through price-fixing. From the standpoint of the war emergency. emer-gency. I expect Mr. Hoover and his j food administration to do very Impor-I Impor-I tant work. In respect to wheat which I Mr. Hoover is given power to buy or sell it ought to be possible to make I price-fixing practicable by such buying buy-ing and selling. I also rejoice In the economv work Mr. Hopver fs doing and instigating. The only proper way of meeting tho cost of war is out of real frugality and Industry. It is criminal crim-inal to talk of 'business as usual.' "But I regard the Hoover commission commis-sion as more likely to succeed In these economy efforts, i. e.. efforts to influence physical production, consumption con-sumption and distribution (and thereby, there-by, incidentally, prices) than in its efforts to control prices in the markets. mar-kets. It may also prevent, to some extent, ex-tent, speculative manipulation and monopoly. Nor do I mean to say that some results may not be achieved In direct price-fixing through the license system and otherwise, especially in stabilizing prices. But I do not expect ex-pect any startling or very radical reduction re-duction In prices and, should radical reductions be attained and sustained, I should expect to see the production of such artificially cheapened commodities commodi-ties fall off. "I am informed by competent observers ob-servers that price fixing abroad has proved a failure. In Germany the effort to keep down the price of milk resulted In the slaughter of cows for beef, to the great net detriment of the German national food supply. Price Fixing Cannot Affect the General Price Level. "And, so far as price-fixing of any kind succeeds, the prices will necessarily neces-sarily be confined to so few commodities com-modities (as specific foods, fuels, etc.), that the general price-level of Dr. Meeker's three hundred commodities, will not be reduced, I venture to predict, pre-dict, even to the extent of 1 per cent, especially as one object of Mr. Hoover's plans Is to keep some prices up enough to insure adequate production. produc-tion. If this be true, official price-fixing cannot solve the great problem of the high cost of living and of price movements in general. We might as well expect to sweep back the ocean with a broom. Even if wo could reduce re-duce the price of wheat and coal by 10 per cent the effect on the general level of prices would be only 15 per cent. Other Unworkable Remedies. "I cannot discuss here in detail the numerous other unworkable remedies for the high cost of living such as socialism, 'trust busting,' the single tax, bimetallism, trade unionism, and laws agains speculation, middlemen and cold storage plants. "Whatever we may think of these proposals for other purposes, they provide no sovereign remedy for the high cost of living. Quack remedies are quite as dangerous In human society so-ciety as they are in human physiology. In fact, the effect of the fallacious beliefs be-liefs out. of which quark remedies grow Is itself generally injurious. Historical Effects of Wrong Ideas. "It is, curious how many great historical his-torical effects the world has experienced experi-enced from misunderstanding the real naturo of rising or falling prices. For instance, the misunderstanding as to falling prices In the eighties and nine- " .- r . ties led to the free silver campaign of 1S9G and lias affected American politics poli-tics indirectly ever since. It stimulated stimulat-ed the Irish land agitation and the home-rule movement because of the pitiable condition in which it placed the Irish peasant debtors. The misunderstandings misun-derstandings of the recent rise of prices have stimulated the demand for the Underwood tariff act, while in England the high cost of living has itself been cited as a reason why England Eng-land could encourage its own production produc-tion by putting on a protective tariff! "Everywhere the effect of the unrest un-rest is to propose changing tho present pres-ent condition of things. The general attitude of mind has been 'wo don't j know what's the matter but let's do' something!' The Problem Is Monetary. "This all means that if we do not supply an effective, scientific remedy for the disease, some unscientific, ineffective in-effective and probably even injurious nostrum will be tried. In 189C we nearly tried the free silver nostrum for falling prices. Today in the same way we are menaced with revolutionary revolution-ary socialism. "We come back to our proper subject sub-ject of price movements. I can see no way of radically changing price movements except by changing monetary mone-tary standards. After the war is over; the question of the policy of governments govern-ments in regard to monetary standards stand-ards will surely come forward. There will be a fight for and against resumption re-sumption of specie payments in paper-money paper-money countries such as there was in this country after the Civil war when it took a decade to conquer greenback-ism. greenback-ism. But if the countries now on a paper basis insist on early resumption and carry it out there will bo a sudden sud-den fall of prices which will have as unpleasant effects as the present rise of prices. We found this so ourselves in the late sixties. "The real cure lies in stabilizing the dollar. A plan for such stabilization will be the subject of ilio following lecture." nn |