The Dominion. THURSDAY, JANUARY 25, 1912. THE COST OF LIVING.

Dominion, Volume 5, Issue 1346, 25 January 1912, Page 4

The Dominion. THURSDAY, JANUARY 25, 1912. THE COST OF LIVING.

There is probably at the present time no question which interests ana affects the general public more than that concerned with the cost of living, and there seems to be no problem they understand less than that of the mysterious agencies which persist in sending most prices upwards. The problem is'not new, and several attempts have been made to secure its solution. But the public remain pretty much in the dark regarding the causes operating. Theories on the subject are numerous and varied, feasible too;, but in reality not very helpful." Acute, practical commercial men have studied the question, and trained, erudite economists , have scanned history and quoted their scientific laws. But nothing like unanimity has been reached, and householders arc left free to speculate whether high prices are due to profound economic principles or to causes and effects confined chiefly to middlemen, merchants, and retailers. The British Board of Trade., it may bo remembered, instituted inquiries some time ago into working-class rents, housing, and retail prices, together with the rates of wages in Great Britain and Ireland, the German Empire, France, and Belgium. The earlier reports go back to 1905, and the later to 1909. Much valuable information is given touching wages and the cost of living in ' the countries named, and useful comparisons are entered into by .way of showing the cheaper and the dearer countries to live in. Statistics such ass are plentifully provided by the Board of Trade possess a certain sociological and national value; but as helping to explain why the cost of living continues to mount steadily upwards they are of very little importance indeed. The samr. may be said with rospect to a brochure just issued by the Australian Bureau of Census and Statistics entitled Inquiry into ihr CnH nf liriiu/ in Jtix'trnlla, 1910-11. Mn. G. H. Kxibbs. (be Commonwealth Statistician, distributed family housekeeping books to whoever desired to set forth their annual income ana expenditure The figures he provides, though requisite for inquiry, touch only tiie fnngo, of the question. In the United States of America, ten years ago personal data were obtained as to the cost of living from some 25,000 families, and in Germany five years later a similar inquiry, but on a much smaller scaK was conducted. In both countries the inquiry went rio further than stating the year's income and tabulating the items on which it was expended. For comparison of prices with preceding years recourss is usually necessary to Government reports, and as the conditions of living vary greatly in different countries, any general, or international, investigation must suffer considerably by a lack of precision. Tn New Zealand some years ago, whpn the late Mr. Seddon inquired into the cost of living, the official reports indicated the increases that had taken place during a given term of years. But the causes which led to the increases were left but partially gucsi,od at. Even elaborate tables setting forth wholesale and retail prices of provisions during Jong periodssuch records arn available for Australia back to IS36—by reason mainly of individual fluctuations, would render but little assistance in any general inquiry at the present time. The problem seems to vary in every country. Australia and 'New' Zealand being what financiers designate debtor countries are quickly affected by a fall in prices in England, interest on loans and earnings of Home investments having to bo paid by exports irrespective of high prices or low. Reduced prices in London mean enhanced rates in New Zealand, declares one school of economics; not exactly, replies another, New Zealand borrows so lavishly in London that natural economic laws are effaced. Of late there have been persistent demands at Home for a searching investigation by the Government with the view of reaching the true explanation of this mystery of prices'. But it must be obvious that if the explanation lies in broad economic laws, the laws affecting prices in England must be different from those governing New Zealand. It is only fair to say that sonic eminent authorities doubt the theory of these broad, far-reaching economic laws.

PiiOFESson A. L. Bowlev, of the London School of Economics, the other clay, expressed himself as greatly puzzled over lhis particular problem. Ho follows scientific methods, but here he seemingly thinks that agencies other than hard economic laws are- at work. He said : "I cannot understand the relation between the alleged retail prices of meat and the wholesale prices. If both are true, the middlemen in the meat trade must be making enormous profits. There is something completely unexplained thorn. Tho first inquiry I sJiould like to see would

be as to the facts. It is a great mystery." Opposed to this somewhat prosaic view is the highly complex explanation that the advance in prices is duo mainly to the enormous output of gold. The much-desired metal has become less valuable, therefore its purchasing power is reduced., There is tha historic fact adduced that at the beginning of the sixteenth century, when the annual production of gold and silver was valued at about oni million and <; quarter sterling, the cost of provisions was very low—wheat, for example, selling at 6s. per quarter. When, at the end of the same century, gold was won worth nearly five millions sterling, prices were five to seven times higher than they were eighty years before. In more recent times, it is pointed out—after the discovery of the Californian and Australian goldfields, more particularly—prices exhibited some almost phenomenal advances. Between 1861 and 1870 the general cost of provisions in Great Britain increased by not less than 40 per cent. After 1870 the production of gold began to fall off, and for a quarter of a century there was a decline in prices of approximately 34 per cent. With the discovery of the South African goldfields, the upward tendency was rc■sumed. Now with a world's output of gold amounting in. value to about ninety millions sterling per annum, it is only natural, says.the historic school, that the cost of living should be not only high, but also steadily mounting upwards. The subject is well worth investigation on practical, sensible lines. New Zealand should begin by finding out the precise part played by "advanced, democratic legislation" of the W-\kd type.