The Increased Cost of Living
An Analysis of Some of the Factors That Cause the Mysterious Jumps in Prices
By GUSTAVUS MEYERS
THIS, of all times, is the time when wage-earners should support any economic movement in their behalf which promises to conserve the power of their wages. Of this there is the most imperative need. The purchasing power of money is not only constantly falling, but a gigantic conspiracy is already successfully under way to impose upon the workers a fiat currency which has not even an artificial basis of value, as capitalists reckon value in relation to money.
Of the whole number of workers, few realize that the money that capitalists pay them in wages is a depreciated, swindling currency in more than one sense. A dollar to-day brings less than half in commodities of what it could purchase ten years ago. The enormous, exorbitant advances in the prices of every necessity have so reduced the buying power of a dollar, that it is equal in value to less than what half a dollar was a decade ago. In no case have wages been adequately increased to meet this increase in the cost of living. The strongest labor unions have not been able to get more than a fifteen per cent. increase in wages, and such an increase is exceptional, at that. What is a fifteen per cent. increase compared to an increase in the cost of living which approximates more than fifty per cent. of what it was ten years ago?
The worker, who has by great difficulties amassed a few hundred dollars in a savings bank as as a security for sickness or being out of work, has been robbed of more than one-half the amount of his deposit.
If, let us say, he has $200 to his credit in bank for the last few years, he really has not $200 but less than $100. If he drew the $200 out of bank, he would find out that it would buy considerably less than what $100 did a few years ago. The only value of money is its buying capacity ;a dollar may still nominally be a dollar; but if its purchasing power is cut in half, it actually is only a half dollar.
Thus billions of dollars are being indirectly robbed from the meager wages of the workers to pay dividends on enormous issues of watered stocks put out by every trust and other capitalist concern. But this is not all. Under a recent act passed by Congress at the bidding of the great financial interests, the national banks are allowed to turn out currency against these very watered stocks. Hotherto, the United States Government allowed currency—that is, bank bills—to be issued against deposits of United States bonds only. But the Aldrich-Vreeland bill, passed recently, contained this "little joker," "or any other securities."
The result has been that immense quantities of watered stocks have been deposited with the United States Treasury, and many millions of currency have been issued against them. It is announced that $500,000,000 more will be issued against these watered stocks. All of this currency is wild-cat currency, having nothing but a fiat value, which means no basis value, even as capitalist standards go. This is the spurious stuff that is now being paid out to the workers, while the banknotes or Treasury notes representing gold, silver, or United States bonds are being carefully gathered in by the great financial interests.
A smash-up is sure to come. The dice are loaded against the working class, and pending the time when the whole capitalist regime will be overthrown, the workers should realize that they must give their support to co-operative movements. Only by this means, with the present odds so fearfully against them, can they hope to conserve something of the buying power of their scant wages, now being largely paid in wild-cat currency. if, instead of depositing their money in banks where it is cut in half and used against them, the workers should become partners in co-operative concerns, they would have the benefit of their wages, which they do not have now.
The American Co-operative Movement
How Co-operation Can be Made Successful in the United States
By W. J. Ghent
Drawing by Alex. Popini
_(retouched).png)
PERHAPS the first question that comes to the student of co-operation is this: "Why has the co-operative movement in the United States so far generally failed?"
I myself have asked this question many times. Many replies, none of them wholly satisfactory, have been given. So I have asked it again—this time of Piet Vlag. This is his reply:
"Because the main spirit of the movement has almost invariably been to obtain at once one dollar's worth of goods for seventy-five cents, instead of uniting the working class against exploitation. The aim has been too narrow, the impatience too great. The earlier co-operators did not see the necessity of building up their own wholesale co-operatives. Eeven now we do not expect the assistance of the earlier co-operators until we have developed to a point where they will see that it is to their immediate economic advantage to be connected with us. With the Socialist co-operators the matter is different. They see further ahead than the others, and are willing, in order to build up a strong central body, to make some present sacrifices and suffer some present inconveniences."
Consumers' leagues and buying associations have often been urged as a substitute for co-operative stores. I asked Mr. Vlag about these, and he replied:
"The consumers' leagues offer an interesting problem. It is undoubtedly true that, under certain circumstances, more immediate economic benefits are derived from them than from co-operative stores. But the co-operation store gives accommodation in the matter of stock on hand to choose from, and of small purchases and relatively frequent deliveries, that cannot be given by the consumers' leagues. The main fault of the buying association, however, is its defective organization. In most cases people simply put their orders together and depend upon a volunteer to distribute the provisions. The volunteer soon gets tired of his task, and the association ceases to exist.
"If, however, small associations were organized on a membership basis, with, say, an investment of $10 by each member, they might be made more effective. Goods could then be bought in larger quantities and sold to the members at wholesale rates. A certain percentage could be charged for the cost of operation. The invested $10 of each member could be used for buying stock in small quantities to insure a greater profit, and as a security for the payment of the consumer's quota of the operating expenses. For example: A woman purchases $200 worth of goods during six months paying wholesale prices. After the operating expenses have been totalled, it is found that 4 per cent. on all purchases must be charged. This woman, in order to maintain her membership, must pay $8.
"In this manner a fairly well-organized movement might develop. The method is, however, against the principles of the European co-operatives. The fundamental principle of the European co-operatives is to sell at the established retail prices, deduct from the profits the cost of operation, and declare dividends according to the net profits.
