A PHONY FORMULA
Coleman, Mcalister
A Phony Formula By McALISTER COLEMAN Cuttingsville, Vt. GO on back to work, boys and girls, and take your cuts, and like 'em. Comes Professor Willford I. King of New York University to tell the...
...The Professor knows what is best for you...
...Net new spending power is the amount of the national realized income plus or minus the change in volume of spending power...
...I will admit that this formula has never yet been tried, but then Einstein wrote down a lot of formulae right out of his head that had to wait years before the stars and the atomic bomb proved how right he was...
...Just a minute^ professor, what do you deduct this figure from...
...How did you ever find that out, Professor...
...Deduct this figure and the balance is the variable spending power for any year...
...The workers' wages or what...
...On his home grounds Will-ford I. King could call a press conference until he was blue in the face and be lucky if the youngest obituary grabber on the staff of the New York Herald Tribune showed up...
...I boil down the relationship between spending power and wages to a common fraction which I call the key ratio...
...Now do you get it ? It seems the professor has been thinking and figuring, thinking and figuring, and has reached the world-shaking conclusion that in good times and bad the public spends approximately the same proportion of income for food, shelter, and clothing...
...Now go on from there and you discover that the professor has reached what he calls "an amazingly simple formula...
...You and all the other strikers are just least common denominators and you shouldn't try to mingle with the numerals on the other side of the tracks...
...I call it The Coleman Formula For Producing Honest Economists and it is copyrighted ' in every country except the Scandinavian...
...If you try to increase the denominator, which the CIO is attempting, without having an increase in the numerator, you are heading for trouble...
...M\YBE I'm being a little hard on Professor Willford I. King of N. Y. U. I don't think so...
...Surprise...
...When you fool around with it, it's bound to get us all into a heap of trouble...
...If anyone came up to him and told him that he wasn't doing right by the key ratio, his.answer ^could not be published in this eminently respectable fiamily paper of ours...
...Deduce from a college professor of economy's annual income the fees, honorariums, expense accounts and such, which he receives from running around the country making speeches against unions to Rotarians, Chambers of Commerce, and bull sessions of the NAM, add two to three years of the professor's labor on a high-pressure assembly belt in an automobile factory, divide the professor into several parts through the tender handling of Harry Bennett's "servicemen," subtract 0.194500 from the remainder and you will get at the end;an Honest Economist, the noblest and rarest of God's creatures...
...You see, CIO Joe, how wrong you are...
...He told the Chicago newspapermen at a special conference after the Rotary lunch at which he sounded off, all about his formula...
...I always felt that Chicago newspapermen were a bit corny and now that they are attending press conferences held by visiting N. Y. U. professors I'm...
...The only difficulty I can see with the Coleman formula is that if it were followed, in nine cases out of ten the economist would stop being one...
...BUT listen to the Doctor's latest thesis...
...That's what you say, professor, but where did that 0.1933 come from...
...Now multiply this balance by 0.1933 and the result is the total factory wage bill for the year...
...Ford's famous ramp he would be known to his fellow workers as Willford The Red...
...You boys should leave that denominator alone...
...confirmed in my opinion of the low state of the Fourth Estate in the Windy City...
...We crave to know, but let's go on...
...So you run along now, and stay away from that naughty picket line and do the home work that Professor Willford I. King of New York University assigns to you...
...Now get out your pencils and furrow up your brows, for here comes the big King payoff: "Since 1919," (the professor is speaking) "the American people have spent about $20 billion ayear for fixed charges...
...About the time he got bumped around Mr...
...I wouldn't know...
...Certainly he has a right to make a living...
...Of course, he may be doing this for the wife and the kinglets...
...Furthermore, the professor has worked out a formula to prove it...
...Dividing the wage bill by the average rate of pay for the year yields the number of hours of factory employment, and this, too, has worked out over the year...
...Surprise...
...King is on his way to be as popular as Hayek with the Rotarians...
...Comes Professor Willford I. King of New York University to tell the Rotarians of Chicago that to ask for high wages is to send us all to hell in a hanging basket...
...PROFESSOR KING has inspired me to work out a formula of my own...
...The Scandinavians seem to do all right when let alone...
...Because buying power is "the only factor that can be changed to affect wages...
...It may be because they haven't a lot of Hayeks and Kings telling them what not to do...
...The figure for spending power is the numerator and the average wage is the denominator...
...This has worked out every year since 1919 within ' six per cent...
...It's just too bad that he should make it at the expense of a lot of decent American workers who are out there fighting for their own livings, and better livings for all of us, for that matter...
...Get this one...
...This apologist for the Fat Boys and his confreres on the boot-licking faculty at N. Y. U. have succeeded in making that bizarre institution a laughing stock among honest economists the country over...
...I have worked hard and long over this formula since 1911 when I first joined the Socialist Party, and I can guarantee its infallibility—within six per cent, that is...
...Well, thank goodness we have been consistent, at any rate within six per cent...
...It seems to me that when a man is entrusted with the education of our youth in such a fundamental subject as economics, and when that man stands up in public before a lot of Rotarians and Chicago reporters and makes such statements as Prof...
...You aren't throwing in the date are you...
...The CIO campaign for a 30 per cent wage increase is an "immediate menace to the nation's economic stability," he pontificates...
...Further, there have been Honest Economists who came into being without following this formula—Thorstein Veblen, our own Stuart Chase, etc...
...King has made, the man has betrayed his science and his fellow scientists...
...Clever lads, these N. Y. U. economists...
...In Chicago, where they don't know what a phony Willford I. King is, they take him seriously...
Vol. 9 • October 1945 • No. 41
