libeling Sewell Avery
Rich, J.C.
libeling Sewell Avery To Save the Country From Inflation he Refuses to Pay 46? an Hour ! By J.C. Rich THIS may cost The New Leader a million bucks, for the Sowall ia vary Avery and rarely sues...
...Maybe the trouble with Mr...
...When the government repays debt the public finds itself with more money snd with less government bonds...
...Avery afford it ? • • * ThERE is no reason why The New Leader should oblige Mr...
...To prevent the inflation the government must take away enough money from the public in taxation to keep their spending down to the safe level, and it may be difficult to get the in-craase in taxation fast enough...
...We shall see that these questions are not quite as devastating at they sound...
...If the public should suddenly want to raise its rste of spending above the full employment level we would be threatened by inflation...
...And not by Mr...
...Avery's million-dollar suit against Butme»t Week...
...In this, as in many things, wt have to depend on a sufficient continuity in the behavior of large numbers of people so that they do not a|l suddenly wsnt to do the ssme thing at the same time...
...This saves them from inflation and also reduce* the temptstion to buy goods fWm Montgomery-Ward, or from anyone else for that Hatter...
...However we cannot see,th* foil meaning of this surprising result until we hsve answered two important questions: 1. What about the interest burden on the National Debt...
...By Abba P. Lerner (In this series of non-technical notes, I'rof...
...A. I...
...One reason is that cash is more readily available for spending than government bonds...
...Such thing* •met not he/ Possibly Mr...
...Sewel Avery hasn't thought about this *nd therefor* does not realise whet a benefactor he is ta his help...
...Bonds arc now being bought instead of goods as the result of patriotism supported by a system of rationing and by th* nonavailability of many of the goods people would like to buy...
...It should judge all its actions by their effects on the economy...
...Avery was trundled out from his Montgomery-Ward office by Mr...
...But as it is, some stockholders are grumbling even worse than the help...
...This means that it should borrow money only when the effects of borrowing are desirable...
...Avery loM and leaked like something the cat dragged in...
...I wonder whether Mr...
...And the way the Roosevelt Administration aids and abets this grsspiag greediness is downright sinful...
...But Mr...
...P. S.-He didn't get it...
...The merest clerk in his claims office could have told him that its a risky thing to sue for libel...
...For all that Bueinrte Week did was to report the facta in that celebrated Chicago fracas, and the facts were that Mr...
...Whether the public has another ten or twenty billion dollars in bonds instead of in cash will not make an appreciable difference to the danger of a tudden spending spree...
...However it is pretty generally agreed now that the effect of government borrowing on the rate of interest is not very great when the amount of idle cash is very large, and also that the effect of th* rate of interest on investment hat been much overrated...
...If this is not desired the government should not borrow even if its taxes do not bring in enough money to meet all its current expenses...
...They will form a useful primer of modern economics.] F UNCTIONAL FINANCE prescribes that the government should never borrow money just because it needs money to meet its expenses, any more than it should impose taxes for the same reason...
...There are two reasons why it may matter whether the public has more cash or more government bonds...
...Avery hasn't already been libeled a million dollars' worth...
...Weil, this is the sort *f thing that goes en right in wartime USA, where every worker is rolling m wealth but atffl is not satiated and demands ** ¦»¦*» aa Ms) aa hour...
...Avery got huffy just the same and demanded a million dollars, or something eaaally astronomical...
...What are the effects of government borrowing...
...And the latest run-in that Montgomery-Ward has had with the War Labor Board it all about a 46f wage...
...That is to ssy it will not mstler very much whether the national debt goes op or goat down...
...2. If government needs are not a sufficient reason for either taxing or borrowing (which is what Fund tonal Finance asserts) what will the government use for money...
...It would be fun to have a million dollars just to libel Mr...
...If only Montgomery-Ward sales stood up under all this trouble and turmoil, all would he well...
...Avery sued—a million dollars is what I think he depended—and far a while there waa danger that the sheriffs would walk in and take the mimeograph machine, stencila, ink pad and all away from the union to satisfy Mr...
...If these effects sre desired debt should be reps id, and if they sre not desired debt should not be repsid, quite independently of whether the government is short of cssh or whether it is very flush...
...Why, a hard-working industrialist in the 86 percent surplus profits bracket was heard to remark that the Avery is making a goddam nuisance of himself...
...As it is, a nice kalanre it maintained and 22 percent of the working population of th* United States earns no more than a mausand dollars a year...
...A munificent, a truly stupendous wage of 4t>< an hour it net what Montgomery-Ward is paying but what the anion is demanding and the War Labor Board has granted...
...At the present moment government borrowing would seem, to hsve an important and • immediate effect on the rate of spending, but that is because of specisl war conditions...
...Ill bet the Montgomery-Ward help is wearing silk shirts with those white collars, but how they manage to keep the collars white on their present pay is the real secret This is a curious commentary on wartime wages, labor profiteering, the Little Steel Formula and what have you, and will put the respectable editorial writers in a quandary or one hell of a fix...
...New, this suit against the gilt edged bible of business executives waa very much in character far the Sewell who is so Avery...
...Aveiy is that he hasn't consulted the right lawyers...
...It is for this resson that the courageous Mr...
...Bueineee Week didn't accuse the rat...
...But if the public has more of its claims to wealth in bonds, it will hesitate before cashing the bonds snd this will give the government more time to do something about anti-inflationary taxation...
...Bough-looking soldier boys come in snd *•»» him out on hit ear...
...in fart, it didn't even mention the cat...
...Avery was something less than nature's nobleman, and there was hell to pay...
...Avery working his fingers to the elbow trying to save a penny for his employees, and what •**» he gat...
...The same thing holds for repaying debt, although iti effects are, of course, exactly the opposite...
...Avery opposes the union snd the War Labor Hoard, and not because he wants lo skimp on the help and make a piece of change out of it for himself...
...But I do know what happened trith Mr...
...Thar* was that celebrated libel suit of his against a mimeographed little paper tewed in Chicago by the darks' union which dared to suggest that Mr...
...Avery—if that is possible...
...Yes, sir, 46< an hour...
...It was thrown out of court...
...you know how careless soldiers can be with papers and other trash...
...Every editorial writer on a serious-minded newspaper who is worth kb ten thousand a year knows that a change in the little Steel Formula would grease the inflation skids and tend us all to financial perdition...
...Rich THIS may cost The New Leader a million bucks, for the Sowall ia vary Avery and rarely sues for leas than a satBian...
...Now even the Union League Club wouldn't know him...
...There was a time when Sewell Avery was the fair-haired boy of every skinflint, money-grabber and union-buster...
...This is not of very great importance, not only because bonds can be cashed very readily, but because the amount of ready money is In any case very large compared to our weekly spending...
...A quick poll conducted by this correspondent discloses that the head of Montgomery-Ward is way down in the Cressley rating...
...jtsosevelt's soldiers...
...Avery with eye-opening information, hut at this season of good will let's give him this for free...
...The primary effect Is that the public finds itself with less cash but with more /overnment bonds...
...A hair shirt if ever I saw one...
...It's embarrassing to let flit world know the kind of wages still being paid the kelp these war boom days...
...Maybe the papers were lost when Mr...
...After the war this last influence will fade away and there will' remain only the other two rather weak guides to government borrowing...
...Save his help from, the clutches of union agents ? Save them the price •f dues...
...On the other hand if these effects are desired the government should borrow even if it does not need the money at all...
...the opposition might bring out the truth—and can Mr...
...Averya claim, and you know how hard it is to get a naw office machine these days...
...We suggest readers clip these short articles and save them...
...On the other hand, if the Montgomery-Ward AAa won their demands and obtained as much as 464 an hour, they would be tempted to splurge and create a shortage, an inflation ad, even an economic crisis in ** sanctum of a big-time editorial writer...
...I .enter of the Ne.w School of Social Research, is discussing basic economic issues of the day in terms that will be intelligible to the layman...
...The other effect of changing the proportion of government bonds to cash is that borrowing raises the rate of interest and discourages investment while repayment lowers the rate of interest and encourages investment...
...Here is the kind-bstrted Mr...
...Jobs and Dollars 5. When Should Gov't Borrow...
...Whatever happened to that suit I don't know...
...Can he explain that al| he wants to do ia save free enterprise...
...Roosevelt a soldiers...
...The trouble with the help is that they "'•ten to outside agitators like the grocer and the batcher, to whom 4oV ia just peanuts...
Vol. 27 • December 1944 • No. 52
