PRICES WILL INCREASE

Evening Post, Volume CIX, Issue 138, 14 June 1930, Page 9

PRICES WILL INCREASE

ECONOMISTS PEOTEST

"ECONOMIC WAR"

With tlie Tariff Bill returned to the Senate for decision on a group oi crm cial issues, the leading economists ot tho country have arisen to demand its unequivocal rejection in the interest^ ot domestic and international well-being and progress, stated the Boston "Christian Science Monitor' recently. One thousand and twenty-eight of these ' authorities, representing every great university and college in the United States, including Stanford, of which President, Hoover is a graduate and .member of its board of regents, have joined in a "round-robin" challenging the economic integrity of the measure and denouncing it as productive of extortion at homo and loss ot trade and goodwill abroad. The protest is the most impressive yet manifested against the Tarift Bill in the more than a year that it has been before Congress. It is peculiarly telling, coming as it does trom men about whose viewpoint there can rest ao challenge of personal interest. The pronouncement of disapproval or the legislation was presented oil sth May to President Hoover, and Lccd Smoot (Republican), Senator from Utah, and'Willis C. Hawley (Eepublican), Representative from Oregon, chairmen of the Congressional finance Committees. Its publication followed the action of the House on 3rd May refusing by decisive votes to indorse the Senate's flexible tariff and debenture amendments. THEEB COURSES OPEN. The count on the flexible tariff: was 236 to 154; that on the debenture 231 to 161. By these votes the House sent these issues back to the Senate, where three courses of action are open. The Senate can recede and eliminate the amendments; it can ask for a conference on them; or it can insist upon its position and force the matter into a stalemate with the next move up to the House. What is likely to happen is extremely doubtful, particularly as there is also before the Senate the preliminary report of the conference committee covering practically all the upward rate revisions. Insurgent and Democratic leaders have expressed decisive protests against the action of the Eepublican conferees "jacking up" the Senate rates in the conference committee, and it is authoritatively known that a, straightout effort will be made by coalition leaders to reject the report. Should tho Senate refuso to accept the conference report the practical effect of such action would be to defeat the Bill. Such an outcome would be directly in line with the policy of coalition leaders who are prepared to call on President Hoover to veto the measure if it gets through Congress. LEADING ECONOMISTS. Originators and first signers of the economists' round-robin were: Paul Douglass, professor of economics, University of Chicago; Irving Fisher, professor of economics, Yalo University; Prank H. Graham, professor of economics, Princeton University; Ernest M. Patterson, professor of economics, University of Pennsylvania; Henry B. Seagor, professor of economics, Columbia University; Frank W. Taussig, professor of economics, Harvard University; Clair Wilcox, associate professor oi: economics, Swarthmore College. What lends additional weight and force to the views of tho protesting economists is the fact that many nf them are connected with banks, public utilities, manufacturing industries, merchandising concerns, and other business establishments. The list contains names from 46 States and 179 colleges. The number of economists signing from leading universities are as follow: Columbia 28, New York University 22, Cornell 18, Harvard 25, Yale 14, Princeton 17, Dartmouth. 24, Chicago 26, Wisconsin 23, Pennsylvania 13, California 11, Stanford 7, Illinois 14, Northwestern 9, Minnesota 15, Missouri 15. INDICTMENTS. Specific charges enunciated by the economists against the Tariff Bill are: That it will increase the cost of domes

tic prices; that few people can hope to gain from its provisions; the vast majority of farmers would lose; American export trade would suffer; American manufacturers in general do not need higher tariffs; American foreign investments would suffer; domestic unemployment contrary to high tariff claims would suffer and not gain by the proposed Bill; higher tariff would_ inevitably inject bitterness into our international relations.

"America," tho economists declare, "is not facing the problem of unemployment. The proponents of higher tariffs claim that an increase in rates will givo work to the idle. This is not true., We cannot increase employment by restricting trade. American industry, in the present crisis, might well be spared' tho burden of adjusting itself to higher schedules of duties. "The United States was ably represented .at the World Economic Conference . which was held under auspices of the League of Nations in 1927. This conference adopted a resolution announcing that "the time has come_ to put an end to the increase in tariffs and to move in the opposite direction. The higher duties proposed in our pending legislation violate the spirit of this agreement, and plainly invite other nations to compete with us in raising further barriers to trade. A-tariff war does not furnish good soil for the growth of world peace." On 24th March, six months and 20 days after the measure was taken under consideration, the Senate passed tho Tariff Bill and sent it back to the House for conference.

Tho final vote of the Senate was 53 to 31, with both Democrats and insurgents voting with the majority. Tho Bill as enacted by the Senate constituted the highest tariff levels in tho history of such legislation in the United States. While not as extreme in most instances as those passed by the House on 28th May, 1929, after a few days' general debate and under a "gag" rule, the Act as formulated presented duties on industrial and farm products well above any other Tariff Act in the history of the country. "1,000,000,000-DOLLAK ACT." So high are many of tho projected rates that the Bill has been termed the "1,000,000,000-Dollar Tariff Act," and as sucli will play its .role in developing political and economic history of the country. The ultiniato fate of the Act after passage through the Senate was still in tho making. In two vital respects it was unsatisfactory to tho President: its wide range of rate revision and the Senate-instituted debenture and flex-ible-tariff provisions. Should tho latter two sections be ■> eliminated in conference, it was generally agreed that the President, while severely criticising the rate revisions, would sign the measure. . When he convened tho special session on 15th April, 1929, the President recominend-ed a "limited • tariff revision. primarily for agricultural relief purposes. Republican Houso leaders completely disrcfarded his counsel and jammed through a Tariff Bill of unlimited range both as to rates and items. Tho Senate Finance Committee in control of a Bepublican majority tempered the increased rates slightly, but not the scope of tho revision. An effort by tho Democratic-insur-gent coalition to restrict revision to agricultural rates only was defeated by one vote. From then on the protracted contest in the Senate was between the extreme rates aclvocatuc. by tho Old Guard Republican leaders and endeavours by the coalition to hold duties generally to those of the present tariff law passed in 1922. COALITION VICTORIES LOST. Early successes by the coalition in this regard ■ were largely lost in the final ballots by "log-rolling" and "trading." Where on the first votes tho rates on sugar, glass, lumber, cement, and other major items were either held to current duties or oven reduced in the last weeks, local, interests prevailed in both Democratic and insurgent ranks and increases. in the rates of many of these schedules were put through. The final disposition of the Act revolved chiefly about the Senate's debenture and flexible-tariff provisions. The President expressed himself vigorously against both sections. The general view was that the Senate would trade the debenture for tho flexible tariff, and that the President, would accept the latter with some modifications as framed by the Senate. Democratic leaders in the House were manoeuvring to obtain Houso approval of the flexible-tariff section, but on 19th May the Senate voted to abandon both the debenture plan and the flexible tariff plan.