The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. WEDNESDAY, JUNE 15, 1927. AMERICAN INDUSTRY

Southland Times, Issue 20204, 15 June 1927, Page 4

The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. WEDNESDAY, JUNE 15, 1927. AMERICAN INDUSTRY

Although the political squabbles in the Australian Mission to investigate industrial matters in the United States may rob that party’s report of much of its value, the Australian Government will be able to make good some of the deficiencies by a perusal of the unanimous report submitted by the delegation sent to the States by the British Government last year on a similar errand. Included in the delegation were Messrs Ernest Bevin, general secretary of the Transport and General Workers’ Union and a member of the General Council of the Trades Union Congress, and Mr J. Kaylor, a member of the Executive Council of the Amalgamated Engineering Union. This body did not attempt to make recommendations and spent very little time in comparisons between the two countries, but it supplied the British Government with, a valuable review of American conditions, with a survey of the worker’s attitude to the problems of modern industrial endeavour. This report upsets many popular theories about the American methods, and among those is the apparent approval of the instalment plan which has given trade a great impetus, and by enlarging the market made possible reductions in cost through larger production. The goods sold at retail on the instalment plan in the United States during 1926 were priced at more than £240,000,000 and the instalment debt at any given time was estimated at £100,000,000. While the report says that caution must be shown in approaching this matter, the effect of this system has been to increase internal trade and consequently the prosperity of industry. Touching the question of production costs, the report says:

Fundamentally the economic wealth of the United States and her continued prosperity as a whole depend on the product of the land. The value of exports of manufactured goods is small in relation to the total value of production, and the success of manufacturing enterprise depends largely upon the consuming power of a great domestic market, which consists of one people having one currency, one standard language, similar political and legal institutions, and a reasonably uniform standard of life.

But the large domestic market is not everything—there remains the method of exploitation, and on this subject the report mentions that in 1921, when there was a trade depression, the employers actually put into operation the policy of reducing wages as a means of lowering production costs. This met with a stout resistance from the trades unions, and the policy was changed. It then embraced

Concentration on increasing productivity, reducing costs and a general increase of efficiency, which, with the maintenance of the purchasing power of the people at the highest level, has had a far-reaching effect on American industry generally.

As a creditor nation, the United States had certain advantages, but the report seems to emphasise the point that American industry, after attacking wages, changed its policy to increasing productivity through efficiency and lowering costs in this way without cutting down the wages and, therefore, the purchasing power of the people. This increased efficiency has been brought about, the report argues, through the cooperation of employers and employees, and their mutual confidence. Pertinently the report remarks that the opportunities for bargaining and discussion are not so important as the spirit in the workshop and in this American industry has great advantages. Some of the big unions object to the “closed shop” and prefer to win their members instead of forcing them into their ranks, which suggests that they would have no time for preference to unionists. These relations between employer and employed are of vital consequence. The report returns to this subject again and again, remarking at one stage:

On the observations we have made we cannot too greatly emphasise that success is being achieved only when the management as a whole, including the foremen, have established confidence in their motives, and have been constantly active in maintaining that confidence.

Industry in the United States has developed and the general prosperity has increased largely through the exploitation of the domestic market, with the export of surplus

manufactures, and this has been achieved through a close study of the processes of production and distribution, resulting in the elimination of waste and reductions in costs.