The Daily News. WEDNESDAY, JULY 17, 1912. THINGS THAT MATTER.

Taranaki Daily News, Volume LV, Issue 50, 17 July 1912, Page 4

The Daily News. WEDNESDAY, JULY 17, 1912. THINGS THAT MATTER.

We referred in our issue of yesterday to a book written by Mr. L.' G. Chiozza Money, entitled "Things that Matter," quoting his remarks on the defectiveness of our educational system. There are other things that matter which Mr. Money deals with. Not the least important are those relating to wages and industry. He believes in high wages and advances the proposition as a challenge ' to the intelligence of every thinking man, that the workman who obtains an advance in wages is a benefactor of his country and liis kind. He says: "That this proposition lias not yet been borne in upon the majority of those who write matter for public consumption is only too clear from a perusal of current comments (1911-1912) upon 'Unrest in the Labor .Market.' The most noticeable thing about these articles is that the chief desire of their authors appears to be that things should be 'settled.' How often one reads sentences like this: 'We are sorry to-say that things are no nearer a settlement this morning.' 'We are glad to say that the prospect of a settlement is a little brighter this morning.' 'We earnestly hope that a settlement will soon be arrived at.' 'We hope that nothing will be done by either side to postpone a settlement.' The request or the demand of workmen for a higher wage is rarely or never treated on its merits as a matter in which right and wrong is involved, and with which is bound up the progress of the nation as a Whole, but as an exceedingly uncomfortable thing which needs to be 'settled,' it matters not how settled, as long as settled. Yet, If the great mass of working people—almost the entire nation that is—do not continuously secure higher wages, the nation must cease to advance both actually and; relatively to other nations." Dealing with the argument of the extra cost to the consumer, the author says: "Even if the whole of an increase in wages were immediately added bv the employer' to the aggregate price of his output, the price of his commodities would not rise in the same proportion as the wages. Wages form only one factor in price, and many of the other factors would not vary. For example, the greater part of the management and standing costs would remain exactly the same, and the profits, which are included in ultimate price, would, if calculated to remain the same, not add proportionately to the price of the entire output. Many materials would not rise at all, and many would not rise in proportion. Therefore, as a mere arithmetical fact, it is not true that if wages were raised, say, 10 per cent., and the whole of the increase added to the price of the output produced by the labor concerned, prices would rise 10 per cent. Although wages are, of course, an element in price, it does not follow that, as wages rise, wages form an increasing element in price. On the contrary, modern economists have discovered that the royal road to efficiency of output, which is the same tiling as cheapness of output, is to employ highly paid labor upon the most expensive machinery and plant, erected in costly and hygienic factories. High wages produce efficient workmen, and efficient workmen produce more for high wages than inefficient workmen produce for low wages. Let me give an extreme case. Lancashire cotton wages are enormously higher than Japanese cotton wages. Yet the high cotton wages of Lancashire are cheaper than the low cotton wages of Japan, because the Lancashire operative produces 60 much more than the Japanese opera-

tive per unit of wages. 111-paid labors is dear labor; well-paid labor is cheap] labor." Mr. Money goes still He says: "The payment of 'high wages leads the manufacturer to carry on his business efficiently, and therefore to produce cheaply. Low wages are a curse to the employer and a curse to the industry in which they are paid. While men or women can be bought cheaply the employer does not worry about efficiency. There is no doubt whatever that the success of Trade Unionism in Lancashire, the consequent raising of wages, and the consequent equal wages for men and women which is the rule of the trade, have done more than anything else to make the Lancashire trade as efficient as it is." Dealing with this matter of high wages from the national point of view, the author suggests the following ' queries: "Question: Which European nation, next to the United Kingdom, has the largest export trade? Answer: Germany, the wages paid in which are, next to those of the United Kingdom, the 'highest paid in Europe. Let us take this a little further. Which three great nations in the world have the highest rates of wages ? The answer is: The United States, the United Kingdom and Germany. These three nations, which pay the highest wages, have also by far the largest export trades in the world. If the payment of low wages really means the gain of competitive power, then it would be the low-wage countries and not the high-wage countries which would 'be at the head of commercial affairs. But it is unnecessary to go abroad for proof of the strengthening of export trade by higher wages. The industries in which Britain chiefly shines, and the trades in which she exercises the greatest power in exporting, are precisely those in which rates of wages are highest."