The Dominion. FRIDAY, MAY 7, 1909. WAGES AND PRICES.

Dominion, Volume 2, Issue 501, 7 May 1909, Page 4

The Dominion. FRIDAY, MAY 7, 1909. WAGES AND PRICES.

",-M<M.fctS6plb will smile when tfedy read this moriing of.the deputation 1 from the' Melbourne : . Trades Hall that waited: on the Premier'of Victoria .to urge <the enactment, of a provision ifi •the law that the Governor should have power to fix the price of flour arid bread every year. 4he idea appears to be; hbt that the Governorshall frdrri tifh'g to' time alter the price of brdad rts circumstances suggest, but thai on January 1 he shall command that a fixed pried shall rule until December Si: As w'e have said; most people will smile at the prdpogaij sincj they'are, only a minority as Jet who have gelt rid of the idea that farmers should grow wheat, and.bakers make broad, for their, own profit, Tho average man will feel in some dim way that the scheme. will not be qliila sound iiutii tiio GJovoriuaaat A u

able to gazette the weather and the state 'of. the harvests and the beh'avibur of the wheat •operatii-'s ;in .'■Chicago : ; and elsewhere. But be'fore dismissing the Trades ?all proposal as too absurd for serious "aUentibn ( wo should ask ourselves whether we'have not in this country indirectly conceded the principle of statu'tbry pribek Nobody will question ' the statement that'there must be an intimate relation between, wages and prices. A simple experiment in hydrostatics consists bf pouring water into one end of ah o'jje.i U-shaped tube in order to show that the water rises to the same level i« both branches of the tube. This hydroStatie has 'its analogue in Mbnomics, -branch of. the tube representing, wages,, and..the other prices. In principle there is little difference betwee'h fixiivg %ages by law and fixing | 'prices by law. To a large extent the effect of either process upon the nation's Wealth, would be the same in the long run. Both 'tend to 'check production and to keep' 'the nation's wealth below the figure, to' which' it would grow 'if industry (were left free. The 'benefits of either must, .ultimately, show themselves tq.be lis 'illusory' lis -the wealth which 'Me. Hoqo thinks would be created by. the issue of bales >of inconvertible notes. ;.Wheh a Government begins to tamper Viththe natural machinery of industry, one can never say how far it will carry )"ts meddling. The statutory, fixing of wages in all, industries is. an economic ■ lleresy that tfrgues in the Govcrninent which adopts it ah Mspund view of '"economic laws generally-. Wc are certain that the Government would not e'nter'taih the 'establisbinenit of Price Bba'rds ;.as a'coin'pleirie'ht to. the Arbitration Court ;¥id. "-Councils 6f .Cb'Mliatio'h, but, /we really cannot see how a defender of the. •ArJ)i,tration Act can) without abandoning '; his 'support of that Act,, find any gbod ( reason why the State should hot gazette .the-pHtib rjHvery'th'irig. ■ So far 'the Labour organisations in this country, hlive made V 6 fle'finlfe itibvo towards asking the Government in so many words |,tc r-fix'..the prices of the necessaries of life. But a little reflection will show that they have made. just this request Under" the veil of a demand for the nationalisation of industries, The trades Unionists Vho waited'; oh Mi. Hogg in Auckland a few days ago to demand relief from the high' price of .bread urged the establishment of State-owned bakeries. Mi is not difficult to see what. Votild ha'rjpeii if thj State, undertook to pi-o-'vide, "cheap bread; for "the people." The result would no 'doubt bo.-, a' heavy annual loss''on 'the.Bread Department—a 'deficit that would require to be made gb,oij .'by taxation; Either that taxation would,'come'lrbjm the users of State bread, in which case there would be no gain to them from the cheapness of the loaf, or ■from,/the; peoplei who use'd other bread. In the second case bnb section of the Sommuhity Would be paying for the bread, of another section; a manifestly unjust, proceeding; Jil the; State, ■went further, 'as-Babotir would like, ah'd erected State flour-rflillsV exactly the same jesults follow. The statutory fixing, of the price of wheat Would inevitably Shatter the whole. bu's : hess. Ev%, the .m'dst extreme Socialist,- we should,say* will, see the Tmp'ossibility bf 'dbihg.that, ah'd/ maintaining.the ,.' su'pr ply: Yet it is; the 1 logical conclusion, of the theory that thi State ban.do.what is wanted by v the 'Melboiifrl'b Trade's Hall. ■■■ ■-, '..''.-'•