CONTROL OF PRICES

Dominion, Volume 11, Issue 94, 14 January 1918, Page 7

CONTROL OF PRICES

AMERICA'S SCHEME

LICENSING SYSTEM. AND COST REGULA-

As already briefly recorded, control of the food prices of the United States was assumed early in November by Herbert C. Hoover, Food Administrator, acting under regulations issued by President Wilson authorising him to license importers, manufacturers, wholesalers, canners, pasckers, and large retailers. By this system the transportation of food and the prices charged to the retailer will be under the direction of the Food Administrator, who will prohibit tho wholesaler from selling his products to retailers who exact exorbitant prices from the public. This step (says a special articlo in tho New York "Times") is "regarded as the most important yet taken by tho Food Administration. AVhen it gets into full spwing the system of-regulat-ing the' handling of foods and their sale will be absolutely controlled by the Federal Government.' The experts under Mr. Hoover arc of the opinion • that tho prices of staplo foods will fall within the next month, and that thereafter there will be nn scarcity of necessities in the United States.

Authority to control the wholesalers and tho largo retailers is conferred upon the President by the Lever Food Act, which empowers the Food Administrator to license retailers doing a business of £20,000 a year. As much of the retail business is under control of ohnins of stores and department stores, virtually the whole retail_ and wholesale business of the nation will be under control. Through competition the small stores which do not come under licensing will be forced to maintain the sdinc -prices that the Food Administrator will force upon those licensed Thus the entire wholesale and retail field will be under control.

Objects of the Regulations. Announcing the complete and definite regulations governing transportation and sals of • foodstuffs, -tho Food Administrator said in a statement,:— "The principal objects of the rules are as follow: —

"1. To limit tho prices charged by every licensee to a reasonable amount over expenses, and forbid the acquisition of speculative profits from a rising market. "2. To keep all food commodities moving to tho consumer in as direct a lino and with as little delay as practicable. "3. To limit as far as practicable contracts for future delivery and dealings in future contracts.

"Under tho Food Control Act, in addition to the. power to promulgate rules, the president is given broad powers ,to deal with individual cases. This power will bo freely exercised to accomplish the three purposes set out above. If every licensee will make those purposes the cardinal principles of his business, and obey, the law and' tho regulations,. ho will bo free fiom interference by the Government Violation is cause for revoking any license as well as subjecting tho offender to such criminal penalties as may be prescribed."

There are a large number of general rules governing all licenses, together with additional special regulations for various trades.

Tho elimination of excessive prices charged by retailers who are not subject to license, will be helped by a rule forbidding licensees to toll food to any person who is violating Section i of the Food Control! Act by taking excessive profits or speculating. An important rule provides that no licensee shall "import, manufacture, store, distribute, sell, or otherwise handle any food commodities on an unjust, exorbitant, unreasonable, discriminatory, or unfair commission, profit, or storage charge."

Profits Limited, With respect to a large group of commodities, particularly son-perishables, the regulations require teat profits shall be no greater than a reasonable advanco over the actual" purchase price of the particular goods sold, without, rogard to the maiket or ropJacnment value.

In determining tno amount of sucft advance, the licensee may average the coßt oR goods of each class. For example, the cost of nil canned corn on hand may So averaged, and a reasonable advance over such average will be deemed a fair sale pneo for canned corn, but the licensee will not be permitted to avcrago tno cost of 'all licensed commodities en hand and add an advance over each average.

Re-salos within the trade without reasonable justification, especially if tending to result in. higher market prices, will bo tleulti vith fta unfair practices. Whenever practicable sll shipments are to.be made in car lots, in cars loaded to maximum capacity. Another rule reads: "The licensee shall not knowingly commit waste or wilfully permit preventablo deterioration in connection with the production, importation, manufacture, storage, distribution, or sale of any fod commodities."

The storage or control by a licensee by contract or otherwise of food commodities in a quantity in excess of the reasonable requirements of this business for use or sale by him during the period of 60 days in prohibited, with exceptions in specified commodities and under certain conditions.

Handling of foods in such a way as to monopolise or restrict the supply is guarded against. Special rules require that foods which have been held in cold storage for more than thirty .days shall be marked "Cold storage goods" when offered for sale; prohibit speculation in futures on canned goods, forbid the shipment of potatoes which have been seriously damaged, protect the . producer who ships his products to markets on consignment against unfair charges by commission men, brokers, and auctioneers, and cover many other special points. Licensees are required to keep records, to make regular reports upon forms that will'bo furnished by the Food Administration, giving complete information regarding transactions in the controlled foodsfi, and to permit representatives of the Food Administration to inspect their property or records. Information obtained in this way is to be carefully safeguarded and .kept confidential by the Food Administration.

Eliminates the Speculator,

No one is expected to do business at a. Los, and the regulations • have beendrawn with the purpose of protecting all legitimate dealers, strengthening them in the performance of useful functions, and avoiding interference with normal activities. Tlio spcculatoi, the hoarder, the waster of food do harm, not only to the public, but to all honest and'patriotic merchants. With this kind of competition eliminated the great majority of food handlers who have consistently tried to abide hy the [w w{ the vr'iErimma of the Food Administration will 'ind that the yare doing business -.ntler greatly improved conditions, and that they can obtain a normal, reasonablo return for the important services which they render to the nation. One famil yin every four in the country has signed the food conservation pledge. Reports show that 51,381,398

fam.'lies lia.vo agreed to effect economies in frod, and Sir. Hoover yelisves that i lie roll will reach 10/lOClM! lieforo the ciimpnigu is ended.