THE PRICE FALLACY OF HIGH COSTS 495 



First. Over-intensity of industry, nationally considered, thus pass- 

 ing the " summit " of maximum per capita productivity. 



Second. Aspiration to ultra-standards of living, thus stimulating 

 consumption regardless of productive efficiency. 



Third. Centralization of industrial and commercial control result- 

 ing in suppressed output and monopoly-price. 



Fourth. The accumulation of private fortunes and the consequent 

 appearance of a leisure class and its concomitant of unsocial labor, cap- 

 ital and natural resources. 



Among the above causes of changing values, there are certain items 

 which exert a noteworthy influence in the readjustment of fundamental 

 costs and incomes which is vastly more important than any question of 

 prices. There are statistical data of unquestioned reliability which 

 clearly demonstrate the course, although they do not afford an exact 

 measure of the extent, of important kaleidoscopic changes in the dis- 

 tribution of income and the coextensive shifting of economic benefits 

 among different classes of the population. It is this arbitrary shifting 

 of cost-burdens, coincident with recent price fluctuations, that accounts 

 for the prevailing outcry against advancing costs of living. Naturally, 

 individuals and groups who fare badly in the process of pecuniary read- 

 justment are prone to complain, and those who account an accelerating 

 balance of income over costs are sanguine. 



Whether the United States has reached or passed the industrial con- 

 dition of maximum per capita productivity is a mooted question ; some 

 who have given much study to the problem of production are inclined to 

 support an affirmative conclusion. That the multiplication of popula- 

 tion and the exhaustion of natural resources have carried certain na- 

 tions of Europe and Asia beyond the summit of production is well 

 known. The Malthusian principle is inexorable, and when population 

 threatens to overrun the natural springs of subsistence, the normal re- 

 sultant is a scale of high prices and the exaction of excessive industrial 

 costs in exchange for the means of living. Whatever may be the pres- 

 ent relation of population to productivity in the United States, the cos- 

 mopolitan nature of modern trade and the fact that other countries have 

 amassed populations in excess of their means to provide an average of 

 comfortable living, have potential significance in problems of costs and 

 subsistence. The further observation that the migration spillway of 

 Europe conveys the surplus increment of prolific and improvident races 

 to the United States at a rate of half a million a year, to be nurtured by 

 " high-tariff wages " and the " fruits of abundant resources," suggests 

 a factor of no mean proportions among the determinants of costs of 

 living in America. 



Advancing standards of living are properly considered as indicative 

 of social progress; but economic limitations of social evolution are 



