564 TEE POPULAR SCIENCE MONTHLY 



RISING PRICES AND THE PUBLIC 



By Professor JOHN BAUER 



CORNELL UNIVERSITY 



THE increasing cost of living, or more properly rising prices, has 

 been the subject of much recent discussion. The causes have 

 been explained and reexplained; everybody knows about increased gold 

 production, also about the trusts, the tariff, labor unions, etc., in their 

 joint and several relations to the subject. But the evils, especially in 

 their broad social relations, have been less definitely analyzed and 

 stated. It is true that the ordinary consumer has paid more money 

 month by month to the grocer, the landlord and others, and that he 

 is complaining rather vigorously about it. Neverthless, for the most 

 part he has imagined and has been taught to believe that the higher 

 prices have meant public prosperity — i. e., larger profits and more 

 business. 



Rising prices usually do mean more profits, but not necessarily more 

 real business. The profits usually go to the grocer, the landlord and 

 others, while the ordinary consumer pays them and is so much the 

 poorer. Unluckily the losses and gains, both unwarranted and 

 unearned, have not stopped simply with making the consumers poorer 

 and the dealers richer. They have not been individual matters. The 

 broad effects have permeated our entire social structure, operating 

 through devious ways, working mischief upon the public. 



The evils complained of are not due to high, but to rising prices. 

 Either high or low prices in themselves signify nothing, if the incomes 

 are adjusted accordingly. If the prices are simply high, not rising, 

 then wages, salaries and other money incomes will be correspondingly 

 high ; all exchanges will simply be based upon a high level. Likewise, 

 if prices are low throughout, not falling, then again wages and other 

 money incomes will be correspondingly low and exchanges will be 

 carried on at a low level. It is the shifting from low to high, or from 

 high to low, that produces mischief. Various mal-adjustments in 

 economic relations follow. All prices and values do not change at the 

 same rate. The normal forces of supply and demand are upset. Some 

 incomes are unduly diminished while others are correspondingly in- 

 flated. There are undue losses and undue gains; both are unearned 

 and both are detrimental to the public welfare. 



In 1910 general prices in the United States were 47 per cent. 



