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Susan Green

Truman-Congress-NAM Won’t Do It

Price Control Up to Labor!

(13 May 1946)

From Labor Action, Vol. 10 No. 19, 13 May 1946, pp. 1 & 4.
Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

The issue of price control before the workers and consumers is a broader one than saving the remnants of OPA. It is the problem of how the people can take price control into their own hands.

Inflation prices are no joke. They reduce the standard of living of all of us who live on wages and salaries, and for the lowest paid groups skyrocketing prices bring dangerous deprivation. The solution is not, of course, that of the profit-seeking National Association of Manufacturers and their like who want all price controls removed. But it is also not in the OPA nor any other agency of the capitalist government, which finagles prices in the interest of private profit- making a mockery of price control.

While this faking and finagling have been going on in every industry, nowhere are they more apparent than in the price increases granted the giant General Motors Corporation.

More Gravy for GM

On April 30, OPA gave General Motors boosts on its various cars from $16 to $60 above existing retail prices. The report from Washington bringing the glad tidings said: “The increases reflect the recent wage increase granted to General Motors workers.”

However, the price increases do NOT reflect wage increases. This is dust in the eyes. And here is the proof:

The findings of the Office of War Mobilization and Reconversion, dated October 1945, showed that manufacturing industries could increase wages 24 per cent without reducing profits and without advancing prices. The Department of Commerce on November 1, 1945, released a report to the effect that hourly wages could be raised 25 per cent without denting profits and without upping prices. The United Auto Workers, before the General Motors strike, submitted a brief to the Corporation proving that wages could be raised 30 per cent with an INCREASE in profits and a REDUCTION in prices, and the union challenged the company to open its books and show if the union is wrong. By refusing the challenge, the company admitted the union was right.

The wage increase granted the auto workers was not 30 per cent. It was not 25 per cent. Neither was it 24 per cent. The modest 18½ cents hourly raise was a meager 16.8 per cent advance – well below what industry, by the government’s own figures, can “afford” to pay. Yet OPA grants this powerful industrial monopoly price boosts of $16 to $60 on a car. This imposition on the consumer obviously does not reflect wage increases. It does reflect the assumption on the part of the capitalist government and capitalist industry that the masses are short on memory and long on gullibility

This latest shameful capitulation to the demands of private profiteers results in a “second round” of increases in the price of automobiles. Walter P. Reuther, UAW president, points out that OPA had already applied its “reconversion formula” and had already allowed prices which averaged $150 to $250 more than for 1941 models and $40 to $140 more than for 1942 models.

A New Swindle

These first substantial price advances were supposed to reflect “engineering changes and improvements.” About this swindle, UAW President Reuther says:

“Since the nature of the alleged changes and improvements claimed by manufacturers in their applications to OPA is not made public, it appears that they have found a loophole for turning a normal peacetime practice into a profitable racket under government price control. Auto manufacturers always made minor changes in their cars from year to year and frequently made important changes and improvements. Yet it was not their peacetime practice to reflect these developments in higher prices. It was the boast of the industry that competition regularly forced the delivery of a better product to the consumer without compensating increases in prices.”

This article highlights the increases in auto prices. But these boosts are symptomatic of a general epidemic. The cost of milk and all food, of wet wash and other services, of clothes and furniture, of electrical appliances and kitchenware, has been boosted by OPA. No wonder the National Association of Manufacturers can make such effective propaganda against OPA!

The General Motors workers who raised the demand for wage increases to maintain take-home pay WITHOUT price increases, also pointed the way to price fixing and price control by the workers and consumers themselves.

The General Motors workers pointed the way with their demand: “Open the Books!” How else can wages and prices be determined except by full knowledge of the estimated costs, sales, improved processes, increase in labor productivity for the coming year or other fiscal period?

But what sense is there in opening the books to the capitalist government that by its very nature evaluates profits as most important? The books of the corporations must be opened to committees of workers who understand the ins and outs of production, and to committees of consumers and housewives at the distribution and consumption end. These are the people’s agencies that could fix prices in the interest of the many and enforce those prices against the profiteers and black marketeers.

Afraid to call the people into action in their own behalf, the officialdom of the labor movement still hitches labor’s wagon exclusively to the dry, rattling bones of the OPA, which was never really an adequate agency for price control.

Labor must end this nonsense. Inflation is no joke. It has to do with whether we eat much or little, are clothed well or poorly, are healthy or sick. As workers and consumers, the people themselves can prevent inflated prices. The demand to open the books of the corporations to committees of workers, coupled with the demand that committees of workers and housewives be organized to fix and control prices, must be made by organized labor, by unorganized workers, by housewives, by salaried workers, by all whose standard of living is threatened by the looming price boom.

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Last updated: 22 January 2019