RISING PRICES AND THE PUBLIC 569 



or six per cent, on safe loans, compared with about four per cent, 

 fifteen years ago. On $1,000 the lender now receives $50 or $60 

 interest, compared with $40 fifteen years ago. The higher interest 

 rate has resulted as part adjustment for the advancing prices or the 

 decrease in the value of money. But again, just as in the case of wages, 

 the adjustment has not gone far enough, so that there has been a net 

 loss to the lender. 



In general, as a summary of the points that have been made, wage 

 earners, salaried employees and cautious investors have lost, while with 

 few exceptions owners of industry and the more speculative investors 

 have gained. The first class includes all contractual incomes, like 

 wages, salaries and interest, which are fixed by agreement; while the 

 second class includes principally non-contractual incomes, like dividends 

 on stocks, profits on real estate, factories, stores of goods, etc. — incomes 

 not fixed by agreement, but depending upon the success of the business. 



Some one remarks that the losses and gains have no particular 

 social significance; some classes merely have lost while others have 

 gained in the scramble for income. The answer is, in part, that when- 

 ever undue losses are brought upon large classes in society, resulting 

 in hardships and discontent, the evils communicate themselves even to 

 the classes not so directly affected. No class lives unto itself; dis- 

 content in one will work through the whole group. However, there are 

 also evils which are distinctly social, affecting society as such, distinct 

 from individual classes. These evils may be outlined briefly as follows : 



1. The advancing prices have introduced an extraordinary risk 

 element into business. Undue gains have been made by some classes 

 arjd undue losses by others. Gains and losses have been fortuitous; 

 they have not resulted from mere careful or careless management; 

 they could not be definitely foreseen, and therefore planned for or 

 avoided. "Who can tell whether prices in general will rise next year? 

 Or the price of a particular commodity? Or wages? Or salaries? 

 For the individual business, or person, is not a particular advance 

 wholly an accidental matter? If with one class rising prices mean 

 greater profits, then with another class do they not mean greater costs, 

 which, too, are uncertain? 



So far as possible, business men and people in general seek to 

 eliminate risk from their daily relations, and they have invented 

 insurance for this purpose. But you can not insure against rising 

 prices, for they do not move by any definitely known law of averages. 

 Economics can tell you why prices change, but it has not the data 

 upon which to predict with reasonable accuracy any particular change. 



VOL. LXXXI.— 39. 



