PRICE CONTROL

Wairarapa Times-Age, 29 November 1941, Page 3

PRICE CONTROL

THE BATTLE AGAINST INFLATION OPENED IN CANADA, ADOPTION OF “CEILING” POLICY. Canada has opened the battle against inflation. Mr Donald Gordon, recently appointed chairman of the War Time Prices Board, when addressing administrators and key men of the Price Ceiling Scheme likened the gathering to members of the general staff commanding an Army consisting of every citizen of Canada. “About to go into action against the disaster of inflation which is imminently threatening this country,” Mr Gordon submitted a proposed plan of action. The objective, he said, “has been very clearly defined. It is this, that no further increase in prices can be permitted, and from December 1 forward the price level must be returned to and maintained at the level ruling between September 15 and October 11. There is no equivocation in that statement. At no time has the Government even suggested that some increase may be permitted or some later date selected for the basic period. Those of us who have given careful study to this problem are absolutely convinced that no other method of approach is even worth trying. We are convinced that the battle lines are drawn and that every foot of ground given away is lost beyond recovery Every effort to control runaway inflation in past wars or in other countries has failed because this fundamental fact has not been accepted.” Four reasons why a general price ceiling was adopted were outlined in a preliminary statement of policy distributed at the gathering. The Government decided, the statement says, against bringing prices under control one by one or group by group, and in favour of imposing restriction over all simultaneously. It was a decision in favour of action so comprehensive as to bring under control retail as well as wholesale prices; prices of finished goods as well as prices of raw materials, including farm products; prices charged for the more important services aS well as the price of goods; and with due safeguards of rates of remun- 1 eration by way of salaries or wages. (1) Such a price ceiling was the quickest measure to apply and speed was imperative. (2) The action on all prices at once was more just, for one man’s selling price was another man’s costs. (3) Though administrative problems of the price ceiling are great they are, on closer inspection, fewer and less difficult than those of dealing with separate prices in turn. (4) The price ceiling starts from an actual relationship of prices as. of a certain period and is more realistic and close to facts than an attempt to build up an arbitrary scale of minimum prices.