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Jack Ranger

Tapping the Wall Street Wire

(30 December 1946)

From Labor Action, Vol. 10 No. 52, 30 December 1946, p. 2.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Much as I dislike intruding on the reader’s happiness during this joyous Christmas season, I feel I must burden you with a tale that will tear your bleeding heart right out of your breast. It will make ”tears as large as grapefruit course down your cheeks,” as Comrade Shachtman would say.

The story has to do with the sorry plight of “Mr. X,” and is based oh “the first of several interviews about the personal budgetary problems of families in all income classes.” It appeared in the December 18 Wall Street Journal. If you can read it without audible moans escaping from your grief-compressed lips, you are a case-hardened scoundrel. Here we go, for the story of how “Mr. X barely manages to make ends meet on $45,000 a year.”

Mr. X, it is related, ”derives about half his income from his salary as president and general manager of a West Coast firm employing over 250 men. The remainder comes from income on his investments. A man in his mid-forties, progressive and a hard worker (see bit about his club-life below), he typifies thousands of other corporation executives over the land.”

Mr. X lives with his wife and three young children “in a 14-room house on one acre of ground in an upper-class San Francisco suburb.” From this description, you can immediately see that he is ill-housed. Frank Lloyd Wright, the great architect, has recommended that each family have at least one acre for each member thereof.

Mrs. X, it appears, receives for household allowances the piddling sum of $1,250 monthly. ”Before the war,” Mr. X recalls nostalgically, ”it ran to about $700 a month.” Mrs. X has the devil’s own time getting the housework done. To help her she has a cook, a governess, a second maid and a gardener, whose wages come to $460 a month. ”Before the war we paid $75 a month for a cook,” says Mr. X. ”Now it’s $150. We paid $90 a month for a nurse then; now it’s $160. Second maid and gardener each draw $75 a month.”

But that isn’t all. “You’ve got to remember we have to feed these people three times a day,” continues Mr. X. “With food prices where they are that comes to a tidy sum each month.” Mr. X’s sums are always tidy.

So the cost of keeping Mr. X’s home in running condition adds up to $15,000 a year. He pays, he says, $20,000 a year in taxes, leaving only $10,000 to go on.

Mr. X, being R-I-C-H, is naturally burdened with club dues. He belongs to five clubs, three in the city ”because of his business connections, and two country clubs.” Dues amount to $1,100. In addition he has to figure on $160 a month for the four months in mid-year when family social life revolves in a degree around one of the two country clubs. His ”golfing club” costs, him another $60 a month, mostly for caddy fees which have jumped from $1.50 to $3 for 18 holes.

When Mr. X takes his family on a month’s vacation each summer, that costs $1,500, “even though Mr. X is a family man and doesn’t indulge excessively in Lake Tahoe’s expensive social life.”

These social and entertainment expenses cost Mr. X around $4,000 a year. It leaves him with $6,000, of which $4,000 goes to pay premiums on $100,000 of life insurance. “That $4,000 for insurance is all my savings now, if you want to call it that,” he says bitterly. All right, let us call it that, and get on with the sordid story.

To make ends meet as prices climb, “Mr. X is applying a business axiom to his living standards: ‘The only way to meet these costs is retrenchment,’ he says.”

“A lot of dining-out has gone by the board,” he relates. ”I just won’t go to these restaurants and pay those awful prices. On Thursday night out, the family eats at home.”

“I buy my suits four or five at a time.” He’s due for some suits now, at $200 per, but is going to put it off. He’s only got one car in the garage, a lousy Cadillac, and finds he can get along all right, “for the present at least.” When he takes those business trips to the east several times a year, at company expense, he no longer takes his wife along because “you know how it is when the women are let loose in those eastern cities.”

Mr. X is “filled with astonishment and wonder” at the free spenders he sees tossing dough around. “Sometimes I wonder if all those people you see throwing their money away are dodging taxes or what,” he muses. Mr. X, of course, does not dodge taxes. He pays them. It says so, RIGHT IN THE WALL STREET JOURNAL. He is strictly a square, from Delaware, with sharp corners.

Up to now, this story has been gloomy, macabre, almost like something from Dostoyevsky. But it has the old twist to if, after all, the Hollywood ending. By dint of saving here and there, Mr. X still lives within his income. He says he intends to continue cutting down expenses rather than biting into savings. ”I’ve never operated that way and I don’t intend to start now,” he said grimly.

One of the first places Mr. X is going to start cutting is in the wages he pays employees and servants, presumably. Our hero feels pretty strongly about “the labor problem.”

“In spite of higher costs,” he says, “the workingman has made a net gain in real income because of pay raises. But I don’t think an executive on a salary has any way of off-setting increased costs. The executive suffered a net loss in real income.”

Here, take my handkerchief.

Economic Notes

The Reynolds Tobacco Co. will have a 1946 income in excess of $27 million, compared with $19.2 million in 1945. Those extra pennies you pay for a pack of Camels today mount up, you see ... The Justice Department, which during the election year of 1940 instituted an anti-trust suit against the American Petroleum Institute and the oil trust, has now quietly dropped the suit, “without divulging the division’s reasons for recommending dismissal.” ... The U.S. Maritime Commission has been accused, by the House Merchant Marine Committee, of paying 2.5 million to the California Shipbuilding Corporation to take a free gift of $39 million worth of shipyard facilities and materials off its hands ... Steel prices have jumped sharply recently. Whereas the OPA ceiling was $19.25 a ton for No. 1 heavy melting, quotations now range from $30 a ton upward ...

Standard Oil of New Jersey and its fellow member of the trust, Socony-Vacuum Oil Co., are going to add approximately $13.4 million to their joint oil investment in Iraq. The two companies own 23% per cent of Iraq Petroleum Co., part of the world oil cartel. This latter company has concessions which now ”include almost the whole of Iraq, as well as certain areas in Syria, Palestine, the Sheikdom of Qatar and the Trucial Coast on the Persian Gulf. They cover some 370,000 square miles.” ...

Net income of Philadelphia & Reading Coal & Iron Co. for the first nine months was $3,432,221, about triple the earnings in 1945 ... In the middle of 1946, a government tabulation showed that 27 per cent of the auto industry’s working force was comprised of ex-service men and women, compared with the all-U.S. manufacturing industry average of 18 per cent ... The buyer of a $1,500 automobile in 1946 paid an average of $133.74 in special taxes in the purchase and first-year operation of the car ... Boris Shishkin, economist for the AFL, believes that the most dependable index pointing to an early recession is to be found in the expenditure for dental work. When such expenditures expand, the indication is that good times are ahead. When these expenditures contract, as they now are doing, he says, we are in for a recession.

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