HIGH COST OF LIVING IN THE DISTRICT HEARING BEFORE A F SUBCOMMITTEE OF THE COMMITTEE ON THE DISTRICT OF COLUMBIA UNITED STATES SENATE SIXTY-SIXTH CONGRESS FIRST SESSION PURSUANT TO S. RES. 150 DIRECTING THE COMMITTEE ON THE DISTRICT OF COLUMBIA Printed for the use of the Committee on the District of Columbia WASHINGTON LIV: HIGH COST OF LIVING IN THE DISTRICT OF COLUMBIA. MONDAY, JULY 21, 1919. UNITED STATES SENATE, SUBCOMMITTEE ON THE DISTRICT OF COLUMBIA, Washington, D. C. The subcommittee met, pursuant to call, at 2 o'clock p. m., in the committee room, Capitol Building, Senator L. Heisler Ball presiding. Present: Senators Ball (chairman), Capper, Elkins, and Dial, of the subcommittee; also present Senator Sherman, chairman of the Committee on the District of Columbia. Present, also, Dr. W. E. Mosher; Mr. Herbert C. Marshall and Mr. Wells A. Sherman, representing the Bureau of Markets, and others. Chairman BALL. Ladies and gentlemen, the chairman of the Committee on the District of Columbia has received from various sources the complaint that charges have been made for food articles, articles of wearing apparel and for rentals in the District of Columbia that were considered unreasonable. In other words, the charges have been made that profiteering has been going on in the necessaries of life throughout the District of Columbia. In order that those charges might be investigated he has appointed a subcommittee. In this investigation it is not the desire of the committee to in any way distress any of the merchants of the District of Columbia who are doing a proper and legitimate business, charging only a reasonable per cent of advance for their products or for their work, and if in this investigation we find that to be true this committee will exonerate all these merchants. But, on the other hand, if these charges are well founded, this committee will endeavor to fix the responsibility and, if possible, will recommend some methods of correcting this evil. We appreciate that the cost of living has increased very greatly throughout the world, for reasons. We also appreciate that the population of the District has very rapidly increased in these last two or three years; that this increase has been entirely a population of consumers and not of producers, so far as food products and living expenses are concerned; that this increased population necessarily requires a great number of additional homes. This makes the District of Columbia, or Washington, to the minds of this committee, a very fertile place for profiteering. That this investigation might be made as thoroughly and as rapidly as possible, at this, our first meeting, we have invited Dr. Mosher, of New York, who is an expert on such investigations as we have before us, as well as some representatives of the Bureau of Markets of the Agricultural Department, thinking that probably they would be able to inform us as to the best methods of acquiring information. Before calling on Dr. Mosher I would like Senator Sherman, who is chairman of the District of Columbia Committee and who has named this subcommittee, to outline what, in his mind, is the best method of procedure. Senator SHERMAN. I do not want to make any suggestions as to the plan or course to pursue. All I have to offer will be more by way of suggestion than anything else. Chairman BALL. Later on? Senator SHERMAN. Yes. The subcommittee must determine for itself the number and kind of help it will call to this investigation. That, it is evident, can not be done by the ordinary help that belongs to the subcommittee's office or the individual Senators. What I think the subcommittee wishes to do is to find whether there is any undue margin between the retail sale of merchandise, taking the staple goods, and the cost to the retailer, the jobbing price. If there is any difference in that margin of profit beyond what is reasonable as compared, say, with Baltimore, find out if any reason exists for that charge or that margin of profit being larger in Washington, if it exists. I do not know whether it does or not. The charge is made that it is so, that the margin of profit here or the retail price is greater in Washington than it is outside in other cities where practically the market conditions are about the same. If there is a reason for that margin being larger in Washington, ascertain what it is. It is possible that wages are higher here, rents are higher, the costs of transaction of business may be higher here. If it is, find it out, and if there is a greater margin here than in other cities for a like kind of merchandise, if that fact should be ascertained, find whether there is any valid reason for it. If not, ascertain then what would be a reasonable margin. The charge is made both in newspaper reports and by a good deal of correspondence that has come to me and, I know, to members of the subcommittee, that prices are higher in Washington than they are elsewhere. I have some specific statements in letters to me. I do not know what has been ascertained by the investigations already had in that particular; but I know in specific instances that have come to me within the last 60 days, say, or since the 1st of April, that the price, for instance, of foot gear is higher in Washington than it is outside, or it is so alleged. The price of clothing is higher; specific articles, specific garments, haberdashery, clothing, footwear, particularly boots and shoes, are reported to me to be less in price in other cities than here. Find out whether that is so in specific cases in the last 30 days, bringing it as near to date as possible. Ascertain whether or not there is any general comparison that can be made with investigations already had. I am informed that it can be done; that the Labor Department has conducted an investigation. It has compared retail prices as well as jobbing prices in various cities of the United States. That will furnish a starting point for comparative purposes. Especially what I had in mind is to ascertain the prices in the last 30 to 90 days, the actual prices in the markets in Washington. I suppose all of us here have had some experience in our homes in particular cases, and that may be general or it may be just sporadic instances of overcharge. Those cases have been reported to me from time to time by letters and some by word of mouth. But my idea would be to get these prices as they are current to-day, or as near the time when this report will be made as based upon such evidence as may be obtained with a finding as to the local condition in the District of Columbia. Primarily my idea was, and I believe it is the idea of the subcommittee, to make this an investigation for the District of Columbia. In all probability there will be also a joint resolution by the two Houses of Congress, either a joint committee or possibly a central committee to investigate generally throughout the United States. I think that would be another matter altogether. I think our particular duty here confines itself to local conditions in the District of Columbia, and I trust the committee will take up that service with an eve single to that duty. Chairman BALL. The idea is that the committee, being the Committee on the District of Columbia, has jurisdiction only in the District of Columbia? Senator SHERMAN. Yes. Our problem relates to the District of Columbia or the city of Washington, and with such help as you call to your assistance you will go along that line, furnishing whatever service you can in solving the question. It would include, I might say, probably an investigation of rents. I do not think that would be beyond the province of the committee at all. That would remotely at least connect itself with the investigation held last winter on the rent question by this same committee. It resulted in no legislation, but in the framing of a bill. One bill passed the House and came over to the Senate. One was reported out by the Senate, but no legislation resulted. I think the committee could profitably take up that question and find whether the rents are justified or not by existing conditions. Chairman BALL. The committee would like to hear from Dr. Mosher. STATEMENT OF DR. W. E. MOSHER. Dr. MOSHER. Gentlemen of the committee, ladies and gentlemen, by way of introduction I will say that I am in charge of the economic and employment research work of the Joint Commission on Reclassification of Salaries. In connection with the study that we propose to carry on in the determination of the standard scale of salaries for Federal employees it is of course of prime importance that we take up the question of the cost of living in Washington. I think Senators Jones and Spencer of our commission got in touch with Senator Sherman and Senator Ball a few days ago, suggesting that this committee of the Senate and the Commission on Reclassification of Salaries might very well cooperate because of our common interest in the cost of living. On account of this common interest I had a talk with Senators Ball and Capper last week, and they suggested that I come down and outline some of the plans which we had in mind as a part of their preliminary survey of the possibilities of making this study. With regard to the high cost of living and profiteering, I feel that the first requirement on the part of the investigating agency is openmindedness. So far as my acquaintance goes, most of the studies of the cost of living or the high cost of rents that have taken place in this country and Canada, as well as in Europe, have proven that pre |