Price-Wage Slash

Signor Benito Mussolini was hastening by an imperious decree last week a process as inevitable as sunrise or moonset. He knew that the lira had risen* and that therefore wages and prices must fall. He gave them a push, and something like a kick.

When the paper money of a nation rises on international exchange, it is as though the paper had been dipped in clinging gold dust, making it more prized in gold-greedy eyes. Soon men will work longer, or will give more in exchange for a bit of this enriched paper. Unfortunately the process is slow, unequal at first in the case of different places or commodities, and therefore highly painful. II Duce, courageous, sought last week to get the inevitable over as quickly as possible by jamming down prices and wages with one fell thrust.

Orders sped, and soon the highly organized committees of Capitalists and Laborers which represent these classes at the bar of the State (TIME, May 2) were told what they must do. Capital must cut prices; but would be allowed also to cut wages. Labor must accept lower wages; but would find the purchasing power of these wages increased by the cutting of prices. Theoretically this procedure was simple, sound. It was as simple and as sound as "daylight saving." But some skulls will not comprehend that a day is the same, no matter what the hours are called. Similarly some Italians could not understand last week that it makes no difference what a man's wage or profit is, so long as he can buy the same amount of goods or labor for it. Quite naturally there was discontent because this thing was hard to understand, and there was trouble because it was hard to apply.

Cuts. The Cabinet of Signor Mussolini cut freight rates by reductions varying between 12% and 25%. Postal rates were cut slightly and telephone rates by as much as 20% on certain classes of service. The carriers affected were all state owned, so a pen scratch sufficed to slash prices.

Secondly the Cabinet cut wages, lopped off from 30% to 100% of the "high cost of living bonuses" which were extended to State employes a year ago. No Government ever took a step more daring, more dangerous. No U. S. statesman would dare cut so much as the salaries of all letter carriers. Yet there was no loud, visible upheaval In Italy last week.

At Turin, capitalists cut prices generally by 10% to 50%. Restaurant prices dropped 10% in Milan, and other prices in varying proportions. In these cities and in the rest of Northern Italy, where Fascismo is strongest, Capital and Labor dared not resist.

In Sicily and below Naples, where the power of Fascismo is more a distant threat than a present force, prices and wages scarcely wavered. In central Italy there was obedience at Rome and in Fascist centres generally, but much resistance elsewhere.

Trouble. Fascist censors and the enforced caution of correspondents in Italy, kept news of disorders at a minimum. John Lucas, New York World newsgatherer, inclined to alarums, cabled:

"In remote places, where Fascists are in a minority, peasants are rebelling openly. At Inveruno, near Milan, an armed revolt was led by Don Galbiati, parish priest. Several Fascists were wounded but carabineers saved their lives. The priest's superiors forced him to surrender to the police, who sent him to prison at Milan, where he awaits trial on a charge of inciting rebellion and insulting the Duce. . . . Encouraged by general discontent, Communists are issuing from secret sources several propaganda sheets with a total circulation of 500,000. These broadsides are filled with violent anti-Fascist tirades and insults to the Duce."

*Since 1923 from 3.95c to 5.65c. The par value is 19.3c.