WORKERS OR WRECKERS?

Evening Post, Volume CIV, Issue 4, 5 July 1922, Page 4

WORKERS OR WRECKERS?

A leaflet circulated at the meeting of the unemployed on Monday, headed " Don't Look for a Job," argues, ( in effect, that the cause of unemployment is the over-pro-duction of commodities that cannot be sold; and that the cure of the cause of unemployment is to stop producing. ' (In .other words, unemployment works its own cure!) In order to examine this argument, let us first consider what is meant by over-production. When a com-modity—-say, a suit of clothes, or any other necessary article—costs the retail buyer £15, the point of * over-production is reached much sooner than when it costs £5. Therefore, it is plain at the outset that over-production is not to be calculated on the basis of a fixed quantity of the article, but is dependent on the retail price, which is in turn dependent on the cost of production; and any inquiry into that cost brings up the element of labour-cost, cost of materials (whioh includes labour-costs in other industries), employer's profit, middlemen's profits, and other factors (such as cost of transport) that need not be particularised. To express the last sentence in concrete terms, let us again use as an illustration a "suit of clothes. If you wish to reduce a retail price of £15 to £5j and thereby turn overproduction into under-production, you must consider the labour-cost in the tailoring industry, the cost of materials (which brings you up against labour-costs in various auxiliary industries, some not carried on in this country, and ranging from cloth-weaving to sheep-rais-ing), employer's and dealer's profits right back along the whole line, freights to and from New Zealand, and sundry other things. The chain is very long, the entanglement very complex.

If some superior wisdom could fix a fair charge for every commodity and every service—and .could, moreover, convince the owner of every commodity, and the performer of every service, that the fixed charge is a fair charge— then the employe!', and the dealer, and the operative, and the retail buyer might all get along splendidly ; and it might then become possible to fix definitely the limit of consumption and production. But how is it possible to fix such a limit, or to say that an article is being over-produced; (that is, is being produced in a quantity exceeding the economic consuming capacity of the people), when consumption and production depend directly upon price (including the price of labour), and when everybody is declaring that his own price is too low and that everybody else's price is too high? The over-producing of s articles that cannot be Bold may be cur-.

able by reducing the price, but how can it be curable by ceasing to produce? When "over-production is caused by high price, to continue to produce may break the price, but to cease producing is to harden the price and —above all— to strengthen the position of all ') corners " ,or monopolising movements that tend to keep up price. This point has been well emphasised by Mr. J. E. dynes and other of the English Labour leaders. If the prices or charges of all commodities and all services were strictly economic, then there might be a "case for limitation of production, because there would appear to be no gain in producing beyond the legitimate consuming capacity. But when limitation is practised under present conditions—and it is •applied both by workers and by employers—it is an arbitrary, and often »an ill-judged, proceeding, founded upon no scientific basis of economic reasonableness. Somebody on the soil changes his crop; he may change from butter to "wool, or from rubber to coffee, but his judgment is generally affected by temporary circumstances, and he has absolutely no idea of raising wool at a certain cost, in order that "it may be spun at a proportionate cost, and made into cloth ■ and clothes, again at proportionate costs, and sold proportionately to the wearer. Either production must be " regulated " throughout, by some superior wisdom; or else the producers, including the workers, must depend upon supply and demand, with the knowledge that to restrict supply is to raise price and to reduce ' consumption and labour. If any worker argues that growers and manufacturers restrict production, and therefore that workers should do the same, the answer is that though, in certain circumstances, restriction may suit the narrow and temporary interests of a grower or a manufacturer, it almost always works out badly for the consumer. Are workers prepared—by adopting Limitation of output or by idleness—to help speculators to squeeze the public? If so, they should follow the advice of the " Don't Look for a Job" leaflet. But if they wish to improve their own purchasing power and reduce the prices charged to the consumer, they will certainly not succeeded by restricting,the quality or quantity ,4 jpf their personal service.