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we have the Pace Bill helng given approval by the House Agricultural Conmlttee. The 

 Pace Bill Includes labor costs in the parity formula and would i^alse parity prices 

 very substantially. Any Increase In the cost of food would be used by organized 

 labor as a basis for clalmfl for further Increases In wages, and so on. If this kept 

 up indefinitely, it would resemble our childhood sport of rolling snowballs until they 

 became unmanageable. Eventually they melted emd disappeared. It might be possible to 

 raise both wages and prices to some given level and try to keep the machinery oiled 

 and in repair so that there would not be a breakdown — a sort of merry-go-round. 



The whole difficulty seems to be that we all think of ourselves as producers 

 and forget that we are consumers. V^e forget that any advantage we receive as producers 

 is eventually canceled by slmilax advantages being given to other groups of producers 

 and that we lose as consumers what we gained as producers. In the field of agriculture 

 there is a tendency for higher prices to make people believe that the opportunities for 

 profit are much greater; therefore they bid up the price of farm land. Mortgage debt, 

 taxes and operating costs are likely to rise with increased prices, and many farmers 

 find themselves in more unfavorable ~f inane lal positions them they were before the rise 

 in prices took place. Some day we may learn that what we want is more food, clothing, 

 automobiles and other goods and services rather than Just more counters to be used in 

 exchanging a limited quantity of goods and services with one another. 



At the present time it is entirely possible that costs of construction may 

 rise so fast that the much-needed Increase in employment In that Industry will be 

 prevented. It is reported that the present national administration alms to raise the 

 national income by 50 percent. That would, of course, be measured in dollars. The 

 chief advantage of raising the national Income in dollars is to make it easier to pay 

 off our enormous federal debt. It is to be hoped that in planning for this Increase 

 in dolleur Income we shall neither attempt to raise prices by way of the scarcity route 

 nor develop such an Inflation that a devastating collapse becomes inevitable. 



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