This is equal to an annual first charge of 5% on $4,000,000,000! Imagine the hue and cry from the press, the immediate injunctions from Washington, the despondent wail from Wall Street, if the railways proposed to pour that much "water" into their own cost of living without getting a mile of track, a single engine, car, or coach, a cubic yard of ballast, one untreated tie or any semblance of improvement or new facility to show for the vast expenditure!
And yet the railways have their increased cost of living to meet just as the rest of us. Nothing they need and must have can be purchased at the prices of a few years back. When you mention steel rails you have named about the only railway necessity that has not advanced its cost of living in recent years, and the railways have to buy 100-pound rails where five years ago 80-pound rails sufficed, and ten years ago 70 pounds was heavy enough for the lighter cars and engines of the time.
But at the first suggestion of advancing rates to meet advancing prices of commodities the Commissions were overwhelmed with protests from shippers and the paring of freight rates down went on as the prices of the goods they carried went up.
In ten years the price of lumber advanced nearly 50%. As a cheap bulky commodity it had enjoyed a low rate in order to move it and it was moved at the expense of other commodities. When it was able to pay a little more toward the cost of getting it to market the proposal of an advance was met with indignant protests from lumber shippers and dealers and reversed thumbs by the sympathetic commissions.
The railways pay more for their lumber and other material today than they did ten years ago but they will have to fight for any advance in rates to meet this part of their cost of living. It is said to be a poor rule that will not work both ways—but the cost of living seems to have only one way of working so far as railway economics are concerned.
Just as a straw to indicate that high prices of food are the result and not the basis of high wages the following table of comparative prices in London and New York from the New York Times of March 27, 1910, is instructive:
| Comparative Retail Prices of Articles of Food in London and New York in March, 1910. | ||
| London. | New York. | |
| Cents. | Cents. | |
| Apples, 1 lb | 4 to 6 | 10 |
| Bread, 1 lb | 4 | 5 |
| Butter, 1 lb | 24 to 32 | 30 to 35 |
| Cheese, 1 lb | 14 to 16 | 18 to 22 |
| Cocoa, 1 lb | 16 to 36 | 25 to 50 |
| Coffee, 1 lb | 16 to 30 | 20 to 50 |
| Currants, 1 lb | 4 to 8 | 8 to 12 |
| Eggs, 12 to 16 | 25 | 6 to 12—25 |
| Codfish, 1 lb | 8 to 12 | 15 to 29 |
| Fish (general), 1 lb | 4 to 12 | 10 to 25 |
| Flour, 3 lbs | 9 to 10 | 12 |
| Meats: | ||
| Bacon, 1 lb | 16 to 24 | 25 to 30 |
| Beef, 1 lb | 16 to 20 | 22 to 30 |
| Pork, 1 lb | 12 to 16 | 20 to 24 |
| Milk, 1 pint | 4 | 4 to 5 |
| Oatmeal, 1 lb | 4 to 6 | 5 to 10 |
| Onions, 1 lb | 2 | 4 |
| Oranges, 1 doz | 10 to 12 | 18 to 50 |
| Potatoes, 1 lb | 1 to 2 | 3 to 4 |
| Prunes, 1 lb | 8 to 12 | 10 to 18 |
| Raisins, 1 lb | 6 to 10 | 10 to 16 |
| Rice, 1 lb | 4 | 6 |
| Syrup, 1 lb | 6 | 10 |
| Sugar white, 1 lb | 6 | 6 |
| Sugar, yellow, 1 lb | 4 | 5 |
| Tapioca, 1 lb | 8 | 10 |
| Tea, 1 lb | 20 to 60 | 30 to 1.50 |
| Tomatoes, 1 lb | 8 | 12 |
The amazing feature of this statement is that the United States produces and exports to the United Kingdom enormous quantities of breadstuffs, meat and provisions, which constitute the chief articles of food in London and which are sold there at prices from 20% to 25% lower than in New York. Clearly it is the high scale of wages that fosters the high cost of living in the United States and there can be little question but it breeds the high wages it feeds on.
It is humanly certain, though economically unsound, that wages will continue to advance with the cost of living and will not recede proportionately as prices of food fall. But both will decline together when for any considerable period there is a surplus of efficient labor for the requirements of American industry. Even railway labor in the most stable of all employments yielded to this influence in 1893 and 1894; and the prices of food receded to the low mark in the following years 1895, 1896 and 1897. Not until wages took their upward turn in 1898 did the cost of food begin to show above the index average of 1890-1899.