106 TWELFTH REPORT. 



INCREASED COST OF LIVING. 



THE SITUATION. 



Wilbur O. Hedriek. 



The subject of our discussion is oue wliich in a very practical sense 

 might be conceived as of that kind to which the older economists so 

 frequently alluded as thino's concerning- which "everyone had a notion 

 sufficiently correct for common purposes." But not unlike many of the 

 other terms thus undiscriminatingly disposed of the expression "in- 

 creased cost of living," must be given more definite boundaries in order 

 to be useful for discussion. 



The popular presentation of the subject which has filled so many 

 columns of our newspapers and magazines during the past winter, if 

 not indeed during the past decade, has seldom undertaken any close 

 discriminations as to the meaning of "cost of living." The apparently 

 unanswerable argument which has been used to support the contention 

 of an increased "cost of living" has been a table of statistics which show 

 that the prices of most commodities are higher now than was formerly 

 the case. These grim looking statistical tables — resembling not a little 

 both in subject matter and in general associations the display boards 

 which stand before restaurants — would indeed be incontestable proofs 

 if there were national households anywhere which, without having had 

 bettered incomes, were obliged to pay these prices. But there are of 

 course no such households and when it is remembered that "cost of 

 living'' to have any practical significance must have reference to actual 

 ])rivate households the assumed sequence of high prices being followed 

 by inevitably high costs is badly shaken. A skillful imagination for 

 example might easily picture such an arrangement of occupations as 

 would allow each to enjoy high prices and yet the interdej>endency among 

 these occupations might be such that none of the members of any of 

 them would be either better or worse ofl" through the price situation. 

 Abstinences and economies of all sorts are also resources which are much 

 relied upon by households to keep down the cost of living in the face of 

 high prices and have thus prevented the need of "deficit financiering" 

 in the family budget which would otherwise exist. Common observa- 

 tion shows that some classes benefit from the high prices which are 

 paid and the result is that there is no such universal identity between 

 the two terms as the newspaper and magazine headlines would lead 

 us to suppose. 



The cost of living has been one of the gi'eatest concerns to mankind 

 from the beginning and economists have always recogTiized its import- 

 ance. It was the cause for example of some of the great migrations and 

 it is at present at the bottom of the colonial policies of nations like 

 Japan, Germany and England. In its harshest aspect it is Darwin's 

 "struggle for existence," and Malthus relied upon it as the force which 

 would keep human population in abeyance. Our contemporary conser- 

 vation of. resources movement takes root in the fear that "mankind 



