Whistle

Duquesne is a little Pennsylvania steel town, twelve miles up the Monongahela River from Pittsburgh. For two years its 21,000 inhabitants watched the tires die in the blast furnaces one by one. Then for two more years the furnaces were cold. Duquesne called it Depression. One day last week, Duquesne whistles shrieked, Duquesne bells clanged. Followed by the city council and most of the leading businessmen. Mayor Crawford marched into the local works of Carnegie Steel Co., picked up a long iron blow pipe, thrust the red-hot tip through a hole in a furnace, igniting a mass of oil-soaked waste. Laborers did the same through eleven other holes and Furnace No. 4 was then blown in. That night Duquesne paraded in celebration. . . .

Volume. For three months the towns & cities of the U. S. have heard with rising pleasure the raucous music of the whistle. It is national recovery at an unprecedented pace, a strident prelude to National Recovery by Executive Command (see p. 12.). The percussions have been abundantly recorded in the cool abstractions that are indexes. Last week electric power production soared (for the sixth consecutive time), to 91.7% of normal. Steel production, most potent barometer of basic industrial activity, surged up another 3% to 47% of capacity, more than three times the rate last March. Bank clearings went to 6.3% above last year's volume. Carloadings in three months have risen from 20% below 1932 to 12 1/2% above. Automobile production in May was the largest in 22 months and precisely twice last year's figure. Six hundred and twenty-one thousand bales of cotton went on to the looms against 332,000 bales in May 1932. May consumption of rubber was 44% above the 30,000 tons used twelve months before. May building expenditures were 128% above April. The New York Times weekly index of general business activity has risen almost perpendicularly from 60 to 84.6. and the Annalist pointed out last fortnight that if the present pace is held (which no one expects) the U. S. would be back to normal by August.

Prices. No less amazing has been the rise in prices. Moody's index of sensitive commodity prices shot from 78.7 to 123.8 last week. Wheat has jumped from a 1933 low of 48 3/4-c- a bushel to 75 1/2-c-, cotton from 5.90-c- a pound to 9.45-c-. copper from 5-c- a pound to 8-c- hogs from $2.85 a cwt. to $4.60. Between $2,000,000.000 and $3,000,000,000 has been added to the value of U. S. crops. A booming New Deal market has swelled stock values $12,000,000,000 and bond values $2,000,000,000. Retail prices have risen much more slowly. Last week Fairchild Publications retail price index was only 1.4% above the low.

Employment. And last week though the stockmarket dipped and commodities turned soft, business continued to improve --long after the normal summer decline usually sets in. In San Francisco Amadeo Peter Giannini declared the Depression '"over." upped salaries in his Bank of America, restored dividends. In Akron the tire industry, rounding out its preparations for the National Industrial Recovery Act, topped two increases in tire prices with a 10% wage increase. In Washington the Federal Reserve announced that its index of department store sales stood only 2% under a year ago.

Secretary of Labor Perkins, who is as conservative in her interpretations as her predecessors were hysterically optimistic, announced that during May national recovery had lifted employment about 5% and payrolls 11 1/2%. Biggest employment gain was not in the beer-&-beverage industry (16%.) but in plumbers' supplies, up 25.2%. Woolens & worsteds and radio snowed a 20.9% rise, cigars-&-cigarets 15.6%. Although admitting that the increases were "far in excess of the normal trend at this season of the year." Secretary Perkins warned: "Purchasing power is still considerably below that needed to take care of the cumulative increase in production and therefore points to the essence of the problem which has characterized the whole course of the Depression."

No small part of the national recovery has been stimulated by the threat of inflation. Fear of rising prices has naturally sent prices skyrocketing, flooded factories with orders at old prices. But it is estimated that not more than 1,000,000 of some 13,000,000 unemployed have returned to work. At that gap between purchasing power and production is aimed National Recovery, new style.

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