Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: v. 34, no. 855: August 2, 1884

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August 3, 1884" The Record and Guide 809 THE RECORD AND GUIDE. Published every Saturday, .191 Broadway, N. Y. TERMS: ONE YEAR, iu advance, SIX DOLLARS. Commimications should be addressed to C. W. SWEET, 191 Broadway. J. T. LINDSEY, Business Manager. AUGUST 3, 1884. The Cause of the Trouble. Nine of the seventeen rail works in this country have gone out of buaineas, and the remaining firms are selling steel rails at $28 per ton, about $1 below the cost of the cheapest method of production. One-half the cotton mills of New England are to close for thirty days during the months of August and September, and all our large manufactories are known to be in trouble from lack of orders and low prices. But thia is not all—the writer of "Mid-week Echoed " in the Sun prints the following: Tbe general complaint of the depression in all branches of business iu this country would not have been so loud if the majority of people had been better posted upon tbe condition of affairs iu other countries. Tbe depression is universal, and ita causes are everywhere the same—over-pro¬ duction and want of confidence. We had only the additional factor of stealing and fraudulent bank aud railroad directors, hat in all other re¬ spects Europe is not a bit better oS than we are. The reduction of tbe bank rate iu London to a per cent, makea loanable capital as cheap as it is here, and shows that an immense aurplus of it is imemployed. Even in Calcutta and Bombay, where 15 per cent, par annum waa till recently con¬ sidered a natural rate, money has fallen down to 5 per cent. The Herald thinks that the difficulty is with the tariff and that there has been over-production, but thia will not account for the depression of trade in Great Britain, where there is no tariff. The Sun writer thinks the difficulty is want of confidence, due to the dishonesty of the financial classes, but this will not account for the bad timea in Europe where, the Sun writer admits, cheating bank¬ ers are sternly punished, Tbe depression cannot be attributed to war or famine, for we have bad no great international conflict for several yeara and the har- vea'a have been abundant the world over. The earth haa yielded not only largely but in many nations prodigiously, yet the trade of the world labors apparently under a distressing burden. There is no profit in business aod the prices of all commodities are being constantly marked lower and lower, "What, then, is the matter ? The cause is evidently one which affects the commerce of the whole world, for the aame phenomenon is observable in every quarter of the globe, especially in the active commercial nations. The solution of the problem is to be found in the attempt of the financial world to substitute the gold unit of value for the bi-metallic basis, which was the measure of prices for fifty years and up to the spring of 1873, when G-ermany and the United States demonetized silver. It is known to the merest tyro in finance that every discovery of gold or silver in large quantities has stimulated healthfully the trade of the world. The splendors of the courts of Charles the Fifth of Spain and of Elizabeth of England and the vast development of commerce at that time was due to the hundreds of millions of gilver which came from the Spanish American mines. The greater part of the marvelous activity of trade in these latter days is traceable lo the gold diacoveriea in California, Australia and New Zealand. But the production of gold and silver has since fallen off, while their consumption in the arts and for coinage has largely increased within the last fifteen years. Legislation has been conspiring with nature to reduce the atoak of precious metals available for com¬ merce by rejecting silver and making gold the aole unit of value, in face of the fact that silver is the most useful metal of the two, and is the money which the mass of mankind use in their daily transactions. There is no hope of a great revival of trade unless the nations readopt bi-metallism, unless, indeed, nature or accident should come to our aid and furnish another gold field as productive as those that changed the face of the business world in 1849 and the years immediately following. They who ought to know say that "Jake" Sharpe and his friends will secure the franchise for the horse-car road on Broadway. The cable company people have plenty of money and have the most comprehensive plan, but Sharpe and his friends understand the busineas of manipulating legislative bodies, and they will come out ahead. The cable people are veiy weak in dealing either with the public or with the business features of their enterprise. The com¬ pany that will probably be successful in securing the franchise will use horses, which will prove a real misfortune, for in addition to getting rid of the omnibuses, it would he desirable to have fewer draught animals on our main thoroughfare. A power which, like the cable, would draw three or more cars would he a great relief to Broadway travel. Perhaps, however, there is something still better in store for us. The electric motor in Cleveland propelled fifteen street cars, and had an advantage over the cable system that the cars could be pushed back as well as shoved forward. There is an electric road at Brighton, Englaud, running along the seashore, which is said to be highly profitable. But the question of the cost of electric motors is not yet determined. So far elec¬ tricity, either for lighting or other purposes, haa not proved a cheap power to use. ---------«--------- The Problem of Wages. Editor Kecord anu Goidk. In your comoients upon the building strike you seem to take the view that a demand for higher wages in dull times has the effect of checking what little remaining activity tbere may be, and rendering the dullness even greater. This is tbe usual view, and I grant that tbe reasoning is upon the face of it quite sound. A little reflection, however, will show that an opposite opinion is not so absurd aa would appear at flrst glance. Suppose for a moment that every member of the community, by tbe exercise of much lauded frugality and self-denial, living on oatmeal, lodging ou boards and the rest of it, were to reduce their income to a dollar a day alike for each and all. would the community then be in a flourish¬ ing condition 3 Evidently not. But if each one received ten dollars a day and enjoyed the health, tbe books, the relaxations, the sermons, that are ■obtainable only by wealth, the whole community would be, I think you will admit, in a very flourishing condition, a state of civilization far surpassing anything we have so far attained. Tbe proposition that we started with, that to lower wages is to increase general prosperity, thus tested, does not seem to be as self-evident as it did before. We must look for the explanation in the fact that all producers are consumers as well. The men that build houses are the men that live in them, not individually, of course; but taking the whole community as a great co-operative society, each works, not for others, but for himself. You yourself in speaking of land-holders frequently allude to tbe stiffuesa with which they adhere to their already prohibitory prices or even advance them in the face of general depression as an evidence of an under¬ current of strength in the nation's industry. By the same reasoning the success of the striking bricklayers should be considered by fair-minded persons as a success of workers in general, including employers as well as workmen, including indeed everybody in the community who gives in return for what he receives. The condemnation that is lavished by the well-to-do upon " the working classes" is based upon a misapprehension of their own truest interests. The prosperity of one cannot be separated from the prosperity of all. Least of all can tbat nation be eensidered prosperous where robbery is held to be property, where our brothers are gradually being reduced, aod reduced, aud reduced, to tenement dwellers, to paupers, to tramps, to forgers and thieves; while bank presidents steal millions unpunished, and bribing corporations gobble the rest. Rienzi. Remaees,—The above communication from an architect merits a candid reply. We quite agree with "Eienzi" that employers who advocate "Chinese cheap labor," or any cheap labor, are extremely ahortsighted. The highest civilization and the greatest prosperity is in those quarters of the globe where the working classes are beat remunerated. India, China, Egypt, agricultural Russia, and all half-civilized nations have an abundance of the very cheapest labor; but every interest of the State suffers because of the poor pay of their working clasaea. It is very evi¬ dent that were all the toilers of this country to receive from $30 to $50 per week, all our industries would be vastly benefited. There would be a demand for books, pictures and newspapers, all the comforts of life and many of the luxuries, to an extent that we can now scarcely comprehend. Builders and real estate owners would be benefited by the demand for better and finer houses and supe¬ rior accommodations. So much is obvious. But the strike of the bricklayers and laborers for a reduction in the hours of work ia not a movement to elevate the whole working clasa. Their success would be a real detriment to other working people, for were they to succeed in getting the same money for less work than they now perform it would increase the cost of houses and raise rentals, and thus become burdensome to their fellow workmen in other employ¬ ments. Nor would we oppose the strike very earnestly if we thought it could be permanently obtained, for it really makes little difference to buildera in the long run. They could charge the additional cost to their customers, and there would be an end to the matter. But it ia clear as the daylight that one class of workmen cannot permanently get the advantage of every other class. Liquidation is the order of the day. There has been an immense shrinkage in prices, in stocks, grains, cotton, wool and all manufactured articles. It has not yet reached laud or labor, because these were the last to feel the speculative afflatus of the boom started by the passing of the silver bill in 1873 and the resumption of specie payments in 1879.