Evening Star Newspaper, June 18, 1922, Page 41

EDITORI NATIONAL PROBLEMS SPECIAL ARTICLES - AL PAGE Part 2—12 Pages EDITORIAL SECTION WASHINGTON, D. C, Sale of Liquor on American Vessels May Give Subsidy Bill Hard Sledding OVER C BY 6. GOULD LINCOLN. the Constitution follow the ? This is not a new ques: tion, but it is a question that has been newly raised—its ap- plication being to the sale of liquor on American vessels, flying the American fug, vessels owned by the the American government and operated under the Unite shipping Board, when re on the nigh seas? involved in the controversy which has been precipitated by Adolphus Busch, 3d, in his letter to the President rezarding the practice of selling liquor on Shipping Board ves outside the three-mtile limit, another guestion. Do the national prohibition uct—the Vol- stead act—apply to all vessels flying the American flag on tae high seas? The second is the guestion which must be ctermined, in ail probability, to lay the CONLTOVersy now waging No Punishment P ded In the Constitution It is pointed out. for exampie, by a Mited States senator learned in con tutional law that the prohibition | tendment to the Constitution “pro WS the sale, manufactur of i trroxicating beve Of its the «oastitn 1l amendment does not pun- 1<h violations of this prohibition. Con- sress was compelled to enact the Vol- ad b andme make the constitutional tically eftective. = Dioes the Volstead act apply to ves sels fiyi e American flag on the high seas? On its face it does not. There is no mention of 1s on the high seas in the statute, it is pointed out. Further- some doubt as to whether laws of the United States apply s an the high s flving ta instance, special enacted by Congress of murd on an American vessel on the high seas, which would imply, it is said, that the general Jaws of the country relating to murder do mot apply on an American vessel cutside the three-mile limit. Conxt Does Not Always Fo w Flag. Incidentally, it will be recalled that the Supreme Court ruled taat the Con- stitution does not always follow the flag in the case of the Filipinos—that mere- ause the American fag raised over the islands, the Filipinos—did not become Ame an citizen: But, generally speaking, it has been | held that an American vessel, where- | ever it may Be, fiying the American fax s art of American territory, wnd American rule prevails on such is doubt but what the publication of the letter of Mr. Busch to the President and his charges that !liquor is being sold on the Shipping Board vessels came as a painful sur- prise to many “dry" members of Congress. Probably not more than [five or six members of the Senate [ knew that the Shipping Board ves- sels were selling liquor beyond the !three-mile limit. This is the guess of one senator—who is a “liberal” in egard to the liquor quesgon. Since the present administration came into the Congress has been Kkept continuously on the job in | Washington. ~ Senators and repre- ntatives have had little time to trave] to Europe, and those who went power almost 1did not alw patronize American | vessels. | | Bars Likely to Close Regardlexs of Law. The opinion of members of Con- | Eress generally is that the publicity lgiven to the matter will force the | closing of the bars on ships operated by the Shipping Board, | no matter what the law in the case be. may But if the prohibition act lis to be enforced on vessels fiying | the other than the Shipping sels, then. in all probability, the law will have to be| amended. Congress found it neces- ry to amend the national prohibi- Ition act when the beer question i iraised its head and the then Attor- {ney General ruled that beer could be | prescribed as a medicine by physi- It put through the anti-beer an overwhelming vote, showing that the prohibition forces ihad not lost their hold in the na- tional legislature by any means. Chairman Lasker of the Shipping | Board has charged that Mr. Busch was actuated. in raising the question of the sale of liquor on board Ship- { ping Board vessels, not by any desir. ! to support the Constitution, but b: a desire to hurt the American mer- chant marine, hoping to drive fast American pas: seas, so that those of Germar take their place. Not unnaturall Busch is denying this. But whatev detare mendment b v might Mr. the motive behind Mr. Buschs ae- tion, the explosion came at a time iwhen Congress, with the President insisting upon favorable action, was about to take up for consideration the merchant marine bill, designed to aid American shipping through gov- | ernmental subsidies. Drys Are Aroused Against a Subsidy. And whether Mr. Busch intended or Economies in the Government Popular Chiefly as Theories Tnfection of @conomies into the operation of the zovernment by put- ting in mo! busines: nd conduct- fng it more along the efficiency lines of a successful commercial corpora- tion T < general approval when- it is proposed. It always gets ever 8 great encore from government offi- « proposition, and. cials a gene of course, from the people of the country. because they see in it a possibility of a reduction of taxes However, whi nproving it and piving their support to the general proposition, it has been found by ex- perience here that the efforts go :long all right as long as there is no itempt to take away some of the uthority of a particular department «r to take away some of the money or nroperty it controls, even though eentralization m ult in better bustness mana and great economies in the general operation of the government. Transport Burenu Proposed. One of the latest proposals, which, 1t 1s asserted. would have brought about biz economies, but which drew fire from all of th government de- purtments hecause it affected nearly every oite, was the proposal to cen- t-alize the motor transportation of the government used here under a geparate bureau in direct charge of the President. While the proposal ap- plied to Washington, it was consid- ered a forerunner of similar arrange- ments, with government transporta- n in various parts of the country. As a zeneral proposition it was ap- proved .but when it came down to the specific point each department had jts peculiar needs, accordiug to the officials, and they could not see how they could function with motor trucks and passenger vehicles sup- plied by a central garas Then, again, many of the officials are fur- nished cars to go about in, and they wanted to keep them. and not have to call up a central station Whenever they wanted to go somewhere. During the investigation to deter- mine the number and kinds of ve- hicles operated by each department in Washington it was found that it was a very heavy financial drain and un- economlcal for the reason that many of the vehicles, with their chauffeurs, were idle for a large part of the time they were available. Advised Centrnl Garage. Brig. Gen. Charles G. Dawes. di- sector of the bureau of the budget, who was brought to Washington by the President to put more business in government, found that among the wastes was the operation of motor cars, and therefore appointed an Army engineer officer, Col. C. O. Sherrill, to co-ordinate the motor transport. That officer, after a thorough investigation, zame to the conclusion that the only efficient way of operating these vehi- cles was to centralize them in one garage and do all of, the overhauling n a central station. A bill was i‘r“ud for Congress providing for his, and carrying an appropriation £ $900,000, $400,000 of which would be_a working fund for operatiom, which would be repaid by each de- partment from its appropriations in proportion to the amount of transpor- tation it actually used. The remain- der was to be used for the construc- tion of a gigantic central garage to house nearly a thousand passenger automobiles and trucks used by the government in the transaction of its business in Washington. Service, either frelght or passenger, was, under the proposed plan, to be | furnished on call, which would alow the retiring of a number of automo- biles now operated by many of the departments only part of the time. It is believed that by a centralization of the government motor transport in Washington alone enough economles could be effected to pay for the con- struction of the garage. 800 in Daily Operation. There are in Washington alone 916 motor vehicles of all kinds under government supervision, of which 800 are in daily operation. Many are trucks used for hauling government freight, while the others are passen- ger vehicles for the use of officials and others in the government. The rentals for garages alone total $30.- 000. There are sixty-one makes of cars housed in twenty-three garages with a capacity of from ten to 125 cars, and forty-six makes housed in forty garages of from one to eight cars each. Most of these small ga- rages are rented. The average cost of operating a car with chauffeur is $175 a month or/$2,100 a year. Many of these drivers are idle a great part of the time, and many of the trucks carry large labor forces which also are idle. One of the expected econo- mies would come from maintaining a mobile labor force at the central ga- rage which could be used to handle the freight on the trucks when need- ed and do work around the garage at other times. It would cut materially the annual labor cost of the govern- ment. It was found that 100 of these cars cost a total of $200.000 a year. to operate under the present inefficient system. It was proposed to eliminate the special cars assigned exclusively to government officials and to furnish this service from thé central garage, much after the fashion of the com-| mercial taxicab service, and charge the particular department for the mileage used. This is one of the pro- posals that brought a great cry of protest, particularly from the officials who are fortunate enough to have cars assigned to them. Many of the officials approved the central garage idea so far as it re- lated to repair and overhaul of cars, in the belief that by volume work it could be done cheaper, but as for calling for cars and trucks for their own use, they objected. From the figures that have been compiled, there is no doubt but that pconomies could be brought out, be- cause fewer cars would be needed, and the ctauffeurs could be required to work the full time for which they are pald, instéad of laying idle about 25 per cent of the time, as under the present system. 7 % American enger vessels from’the | upon ob not to embarrass the administration leaders of the Senate and House ln their conduct of the ship subsidy bill by injecting the prohibition question, he has succeeded. “Drys” in both wings of the Capitol are declaring that there shall never be a govern- ment subsidy for any American ves- sel which sels liquor at any time or place. The administration leaders realized that they had a real fight on their hands to get the ship subsidy bill through at all, notwithstanfting {the demand of the President for action and his suggestion that |f the bill were not put through he would immediately call the Congress in special session to take the matter up again. But with the prohibition is- sue, and the bitter feeling onsboth sides of the question, raised in con- jnection with the shipping bill, it has become a far .more difficult task. Some of the leaders are urging that the subsidy bill be considered on its merits alone, and that the prohibi- tion question so far as American ships o nthe high seas is concerned be handled in an amendment to the Volstead act. The Shipping Board, it may be said, maintained “diplomatic silence” in re- gard to the sale of liquor on its ves- sels at the Capitol. In fact, on some occasions it failed to answer ques- tons propounded by “dry" senators as to the practice. But Mr. Busch has brought the matter to a head. Might Bar Foreign Vensels With Liquor. | The contention of the chairman of the Shipping Board is that if the American passenger vessels salling overseas are to be able to compete with foreign vessels they must be allowed to sell liquor, otherwise the i foreign vessels will get the passen- gers and the American vessels will not. The Supreme Court of the United States in a recent decision held that jforsign vessels cculd not bring liquor to this country for shipment across {the United States to some other for- {eign port. The drys are intent now i ning 2 decision, if possi- [ble, to the efract that foreign ves- |sels with liquor aboard may not en- ter American ports. With such a {ruling, they say, then the American and fereign vessels will be on the same fcoting when it comes to carry- ing passengers to and from the United States. But there is some question as to whether the United States will seek !to dictate to other nations as to the |conduct of their vessels on the high scas. The United States has been |sealous of its own rights in regard to ]Amerlcan shipping at sea. and to deny entry to the vessels of other nations might result in retaliation by those nations, it is pointed out. The Sunday Shar. SUNDAY MORNING, JUNE 18, G. O. P. LEADERS UNEASY BY N. ONGRESS INACTION . MESSENGER. NE of the first questions which visiting republicans from “back home” ask their senators and representatives and high-up men in the administration, is, “With such a strong majority in the Senate and House, why cannot you people get together with President Harding, frame up a program of legis- ~lation and put it through?” The patience of the country over the bills, deferred action on others question voices, it is said, the im- prolonged consideration of some and the differences between the executive and the Congress on still others. It is said to be a very embarrassing inquiry, met usually with a puzzled look, wrinkling of the consarn it all, follows something like the appeal of olden da; “Don’t shoot at he ca * % But it is no jesting affair. brow, and the response: “Well, n't that just what we are trying to do?” And then posted in the border concert halls the pianist; he is doing the best * k The fact is, the administration and the Congress, as well as the leaders of the party at national po- litical headquarters here, are thoroughly cognizant of the state of thin, and are at this hour seeking as best they may to overcome the difficulties which infest the present situation. Here comes Sen- ator Lodge back from a visit to Massachusetts, in the course of which, no doubt, he heard echoes the Presiderit. of the question and probably told A few days ago there was a gathering of some twenty-odd prominent republicans from cities between coast and coast, to discuss'raising campaign funds, and at a dinner at the Metropolitan Club they unbosomed themselves, it is said, of the same plaint. And everybody concerned admits the existence of the situation, and is' disturbed thereby. * % * % Republican observers in Congress say that it seems as if the party in the Senate and House is breaking up into factions, edch group disposed to take the bit in the teeth and break away from party solidarity and teamwork with the executive and the national organization. There is said to be a growing disposi on to proceed on the maxim of “Every man for himself and the de'il take the hindmost.” Those observers who are more pessimistic and bitter in their comments declare that there-is a tendenc: in the face of the im- pending elections, to sacrifice broad party interests and welfare to personal considerations This criticism does not come from the executive and the legislative- branch, but is heard in the body to which it is applied—the Congress. * ok Many thoughtful commentat * X ors in Congress say that in point of fact this administration is freer from attempted executive pres- sure than many preceding administration, democratic and repub- lican. for a little more executive press Some of the old hard-boiled partisans. indeed, at times sigh ure, and think that an occasional twist of an iron hand might be beneficial. but in the end admit that in the present state of ferment ar haps the course being followed is * % An incident is cited showing 1d disagreement over policies, per-’ the wisest, after all. * % the highly sensitive state of mind in the congressional ranks. Speaker Gillett gave a dinner at one of the clubs last week, to which he invited some forty-odd republicans of the House, including the steering committee and other leaders. Chairman Lasker of the Shipping Board was one of the guests, and made an earnest plea for the merchant marine bill, so firmly urged by the President. It is said tha t several of the members present chose to take umbrage at this and regard it as an attempt to win them over to a measure of which they are dubious. “What are to do_in a ¢ tinued on Third Page.) case of that kind?" asked a 1922, Delicate Chile-Peruvian Negotiations Being Handled With Skill and Taet BY BEN McKELWAY. AVING successfully navigated the rough seas of -discord and the jagged rocks of failure which huve wrecked past voy- ages of its kind, Chilean and Peru- vian delegates have handed thelr pa- pers to a pilot who must now take the frail craft which has carried them thus far and bring it safely to the port of amicable agreement. | To all intents and purposes the Chilean-Peruvian conference over the unfulfilled provisions of the Ancon treaty has ended. The matter rests now in the hands of Secretary of State Hughes, a man who possesses !the clear, understanding vision and the diplomatic skill necessary to iron out the few remaining obstacles which stand in the way of achieving the end toward which the conference was launched. That he will be suc- cessful is taken for granted to the extent of prophecies by those who {have followed the proceedings that the delegates will be ready to pack up and go home before the end of the coming week. Secretary Hughes has before him both sides of the con- troversy which has brought the con- ference to the end of its course. Ob- servers outline ghe existing dead- lock as a question of interpreting the plebiscite clause of the Ancon treaty, Chile maintaining the trouble lies in how the plebiscite should be held, Peru contending the time has elapsed for a pleblscite to determine the na- tionality of Tacna and Arica and a new msethod for settlement should be found. Secretary of State Hughes is expected to weld the opposing views '|nto a formula for agreement, which, in turn, may be submitted to formal | arbitration. Secretary Hughes Te Act Informally. In asking the informal services of Secretary Hughes the Chilean and Peruvian delegates have shown the tact and skill which has character- 1zed their negotiatipns throughout the various stages of the conference. There is nothing which binds them to accept his interpsetation of the suitable solution. whereas if the mat- ter as it now stands had been for- mally placed in the hands of United States for settlement it is com- monly agreed that both parties would in a manner be forced to accept what- ever verdict was reached. Thus an embarrassing situation which might have arisen has been averted. trouble all along between Chile and Peru has been the failure to agree on | a specific point of difference between | them. Both countries have steadfast- Iy refused to budge from their own interpretations, and this fact has kept them apart rather than any unwill- ingness on either side to agree to a definite proposal, once that proposal Mental Tests for Public School Children Based on Systems Developed During War CIENTIFIC tests which are being conducted on a limited scale in the District public schools under the direction of Robert L. Hay- cock. supervising principal of the third division, are destined to play an; | important part in the future in meas- uring the intelligence of the Wash- ington school children. Production of the scientific tests and educational measuring scales during the last five years, according to Mr. Haycock, has been prodigious. The increased demand for standardized tests for measuring the intelligence of pupils and for judging the com- parative value of instruction, he sald, has been an outgrowth algo of the many surveys of the city .and state I school systems conducted here and throughout the country. Development of the War. As an aftermath of the world war two important movements have been affecting in a marked degree the progress of education in America, Mr. Haycock pointed out. Revealing as it did the physical unpreparedness of our young men for the rigors of war, great emphasis is now being placed upon health education and physical training in the public schools. The other movement is the extension of testing and measuring into every fleld of education. This movement was glven a wonderful impetus as a direct | outgrowth of the work of a group of ! expert psychologists who tested dur- ing the war more than a million men in order that they might be properly assigned in the Army. The art of measuring intelligence had its earliest development in 1905 at the hands of Alfred Binet, an eminent French psychologist, who, with the assistance of a physician of Paris, devised a series of tests to be used for the allocation of atypical children. Their tests were revised jagain and again until 1911. They then were translated and made avail- able for use in America by Dr. God- dard of Vineland. In 1915 Dr. Terman of California published the Stanford revision of the Binet tests. The Ter- man revision is now more commonly used than any other scale for atypical children. Applied to Drafted Men. Psychological measurement did not begin with Binet. Prof. Cattell ‘of Pennsylvania and Galton in England had already blazed the way, but their measurements were more or less psychological and did not have much value in education, according to Mr. Haycock. In fact, he said, the work of Binet and Terman did not have its broadest influence until the war came on. The influence of Cattell was felt more through his pupils, the most dis- tinguished of whom was Dr. Edward L. Thorndike of Columbia University, recognized ax one of the leaders in the field of educational research and measurement. ‘While thousands of men were being drafted. the American Psychological Association offered the services of its members to the This resulted in the development of the well known Army tests, devised rot for the purpose of finding out how much schooling the men had, but to determine the mental caliber of the Army recruits in order that they might be assigned in the service ac- cording to their intelligence ratinzs. System Has Been Standardized. Among the sources drawn upon in the preparation of the Army tests was a manuscript of a complete group test prepared by Arthur S. Otis, one of Dr. Terman's pupils. The distinct serfes were finally standardized, the so-called Alpha series made up of subject matter entirely verbal, and the Beta tests, which were non- verbal, being made up of symbols and pictures for measuring the intel- ligence of flliterates and men who could not speak English. After examining 1,726,000 soldiers the psychologists had established forms and standards that can hardly be questioned as to valldity, Mr. Hay- cock sald. Before the war had closed the Na- tional Research Council, nder the leadership of M. E. Haggerty, L. M. Terman, E. L. Thorndike, G. M. Whip- ple and R. M. Yerkes, began experi- menting with the Army tests with a view to adapting them to use in the schools. The general education hoard appropriated $25.000 for this work. Thousands of children in the public schools of Washington were examined and finally standards were establish- ed and the so-called national intelli- gence tests were published. Children Like Soldiers. The subject matter found in the Army tests, which had been so care- fully developed and standardized, has influenced in a remarkable way the content of the many tests that have since been published. The first test of tle Army Alpha examination is # test in folloWwing directions. 1In all intelligence tests the ability of the child to follow; diections is an indlcation of mental capacity, it _was emphasized by Mr. Haycock. This, he said, Is particular- Iy true In tests that have been de- vised for very young children. The second part of the Army ex- amination is a test in computation. In most intelligence tests the prob- lems in arithmelic are given instead of examples in the " fundamental operations. Ability to reason is a basic factor in the measurement of intelligence. The third test in the Alphs pam- phlet is a measure of common sense. Tt is sometimes called the best choice lyoung children. Dr. Henmon of the | ments o " i War Department. test and is really a test in the ex- ercise of good judgment. s The ability of the person examined to interpret thought is measured by practically all of the inteclligence tests that are in use. Test No. 4 deals with synonyms jand antonyms. The idea of con- trast and conyarison is involved {here. These also are important fac- tors in intelligence testing. The ex- tent of one’s vocabulary is revealed Imore or less by this test. Language Text Important. In the fifth test a number of dis- arranged sentences must be rear- ranged so that the words in each case will produce a complete thought. In nearly all intelligence tests are found exercises in language con- struction or completion. Binet used this means of testing. Dr. Trabue of Columbia University has produced a series of language completion tests that are recognized as reliable meas- urements of mental ability. In the sixth of the Alpha tests the soldier was directed to arrange a number of digits according to a sug- sested sequence. The task becomes more and more difficult as he proceeds. In the seventh test of the collec- tion the soldier was asked to show how he could work out analogies. Reasoning, comparison, and the as- sociation of ideas are all brought to- gether In this form of test. The use of analogies as a means of testing mentality was originated a number of years ago by Burt, an Englishman, The eighth Alpha test is designed to jdetermine the range of Information. Here the psychologist seeks to know something of the experience of the individual. It is recognized that gen- eral intelligence is not only a matter of native ability, but is made up of a total of capacities growing out of environmental influences, experience and training. Influenced by Army Tests. Virtually all of the Intelligence \tests that have been produced since the war have been influenced in their content and in their administration by the Army tests, Mr. Haycock points out. The adaption of these tests for the measurement ‘of puplls In the primary grades, he said, has been an interésting development. Be- Veause of the meager language train- ing and the limited vocabulary of the very youngest puplls, he said, the tests that have been devised for them are mainly non-verbal. The chlld is asked to do while he thinks, and is expected to interpret and classify pic- tures and symbols. Now that many such tests are In use, educators are seriously engaged in proving their validity or relability. in measuring the mental capacity of A s University of Wisconsin has made a comparative study of Pressey's i primer scale, Myer's mental measure, Dearborn’s group test and Haggerty's Delta 1. He tried these tests with first and second grade children. In some respects the Dearborn and Hag- gerty. tests are most satisfactory. he thinks, although the Dearborn took long in ‘its administration, thus caus- ing too much fatigue for the smaller children. He found that the use of two tests produced more reliable re- sults than one test, and that three gave better results than two. A Comparison of Testn. In Jackson, Mich., a study has been made of comparative reliability of five primary intelligence tests under the direction of Miss Helen Davis. Here the Kingsbury, Otis, Dearborn, Haggerty and the Detroit first-grade tests were compared and were ranked as in the order given. Psychologists have found it more difficult to estab- lish criteria for the comparison of primary tests than in the case of tests for older pupils. For the young- er pupils those tests are ranked highest that have the most satisfac- tory correlation with the teachers’ estimates of the intelligence of the pupils. It 1s agreed among experts in edu- { cational research that the teacher | should use achievement tests to sup- plement intelligence tests if she would obtain the most reliable infor- mation concerning the mental ability of her pupils. The Illinois tests are combination tests which are designed to measure both intelligence and classroom tralning simultaneously. Not Absolute Forec: The teacher, Mr. Haycock said, also is warned not to accept the intelli- gence rating revealed by the standard test as an absolute forecast of the child’s progress in school or success in life. Success, Mr. Haycock de- clareq, is conditioned upon a number of factors besides native mental ca- pacity. Health, character, will\power, ambition, social relations and other environmental influences all affect the child’s life, according to Mr. Haycock. The great war has left its impress upon the schools by the interest that has been aroused in the child’s health and his physical welfare. It also has given rise to an intensive scientific study of the child’s mental nature and development. These two move- ments have been far-reacfling in their effect upon administrative procedure throughout the country. It is thought by many educators that the next field of investigation will be the moral nature of the child in its relation to education. This is a comparatively unexplored fleld, and it is not at all fanciful for the educators to predict ‘that scientific research in this new field may pro@wce unexpected develop- = The | i i | | | { | recognized to some degree both in- terpretations. Existing Deadlock Not Unbreakable. It is very easy to understand the inability of the delegates themselves to agree on a question for arbitra- tion Two men who have inherited | opposing views on a subject, who grow up believing their side is the only right side and who are familiar from birth with the pros and cons of the question at issue, luck the per- spective held by a third person who views the difficulty calmly and un- emotionally, free from the hother- some side Issues which serve only to complicate the problem. This is true| of Chile and Peru, whose delegates represent their thought and senti- ment. It is doubtful that if during the course of the whole conference here either side has advanced argu- ments which differ materially from those put forward during the last thirty-eight years, since the trouble | over Tacna and Arica and other pro- | visions of the Ancon treaty started. But by dint of sacrifices on both sides and a determination to succeed the disagreements over what can be submitted to arbitration have narrowed | themselves down to a point where their ultimate merger can be brought about by a third person. This has been recognized by the delegates in selecting Secretary Hughes to cut the Gordian knot which holds them in deadlock. Statesmen Cater To Public Sentiment. At times during the last five weeks of conference the proceedings have been enveloped in such a cloud of pessimism and doubt that predictions were freely made that the failures of thirty-eight vears would be repeated in Washington. These conjectures were born many times of dispatches from either Peru or Chile quoting some official of the home government, reiteratiug his country’s position and unwillingness to depart from a stand diametrically opposed to what the conference must eventually do to suc- ceed. But it should be remembered that statements of this kind have been mainly for “home consump- tios Chilean and Peruvian states- men like to reassure their people that nothing is to be surrendered, nothing to be given up. And in this manner | they have kept alive the public senti- ment which is necessary to make the final agreement popular. It can be safely said, however, that at no time during the conference has there been seri; anger of its fai {and ure. Much has been said of the pres- tige of the United States, and how it would rise or fall in the success or failure of the Tacna:Arica conference True, the prestige of the United States in South America is in a manner con- cerned with the settlement of this old quarrel. Their Preatige Also Concerned. But what of that of Chile. or I'eru? Hoth ore sovereign powers whost rich futures are to be closely identi- fied with the future of all Latin America. The prestige of both, not only in Latin America, but in the world, is largely wrapped up in the outcome of the present conference Neither country can afford to admit. after such efforts as have marked the present conference, that they are unable to agree over an issue which when compared with other interna- tional issues settled peacefully in the past, is of minor importance. Chile Peru in this instance have heen put to a test in which all of Latin America is vitally concerned for itx bearings on future controversy be- tween Latin American republics. To fail now would mean a grave stignm on the international records of both On the other hand, the conference will the success ot mean much to both countries. Their neighbors in Latin America are willing to credit them, first, with their agreement to come to Washington and lay their differences openly on the conference !table between them. They realize the course was dangerous and the stakes were high. And when they have settled for all time the trouble which lies betwecn them they will receive the honor and prestige whicl will be theirs for having successfully undertaken a difficult task. For economic reasons, also, both countries realize the utmost impor- tance of a successful outcome to the conference. For should it fail the bitterness and ill feeling which now exist between the two republics would be increased, with the grave danger that at some future time, perhaps not far distant, the old quarrel would b settled by force of arms. Such an outlook would not be inviting for the investment of capital or foreig: loans to assist the development of natural resources. It would be u handicap not easily disposed of, bul a handicap which will be definitely removed in the success of the cun ferenc Average Retailer No Profiteer, Inquiry by Congress Discloses broadly ! been con- | The American retailer. speaking, for some time has pictured as a profiteer, but a gressional commission has made an | investigation which does not bear this out and, in fact, is prepared to give him a rather clean bill of health. The joint commission of agricul- tural inquiry which is soon to make a | report to Congress puts this stamp of approval on the American retailer. A study of the charts and figures containing the information brought out by the commission's inquiry in- dicates that during the period of rising prices, which it has had under consideration—that is, 1913 to 1921, inclusive—the percentage of margin for operating expense and profit, which the retailer took from the dol- lar paid by the consumer, did not in- crease. In other words, if the pro- portion of the consumer’s dollar the retailer paid for merchandise in 1913 was 70 cents and operating expense and profit 30 cents. the same ratio was retained during the period of 1913 to 1921. In some instances the percentage of margin and profit changed considerably during the period. . As operating expenses ad- vanced, profits reduced. Profita Near Vanishing Point. For 1913 the gross margin taken by the retailer out of the dollar re- celved from the consumer was 29.16 cents, of which 6.8 cents was profit, while for 1921 the gross margin was 26.16 cents, of which 1.13 cents was profit, a composite chart of the dis- tribution of the consumer’s dollar by retail dry goods, grocery, shoe, clothing and hardware dealers shows. In 1913 expense, exclusive of profit, was 22.36 cents and in 1921 it was 25.03 cents, showing an average in- crease in operating cost of cents and a reduction of profit of 5.67 cents. Out of the profit indicated by these figures must be deducted such items as shrinkage in inventory value of merchandise, federai taxes and stock moving reductions in _response . to price declines or movement of stock accumulation. The report to Congress will show that clothing retailers took their largest profit from the consumer's dollar in 1915. From %916 through 1921 the margin steadily decreased, except in 1919, when heavy sales temporarily reduced the ratio of ex- pense to.sales, resulting in a lower cost of operation for each dollar’s worth of merchandise sold and a con- sequent increase In profit. In 1921 the industry showed a_ trade profit of 1.3 cents per dollar of sales. The report will show that the average profit of clothing retailers during the entire period, 1913 to 1921, was 6.10 cents per dollar of sales. The hardware profits for the same period, the report will show, aver- aged 5.35, with 8.3 cents per dollar of sale the peak in 1916. In the retail shoe trade, average profits for the entire period 1913-1921 were 6.17 cents per consumer’s dollar, the report indicates. The high profit mark was reached in 1919, wken the average profit was 9.36 cents. | Profits averaged 5.3 cents over the gill pass the m! | operating expenses of same period in retail dry goods and were highest in 1916, when they aver- aged 7.3 cents per dollar. Tables of distribution show that one of the outstanding defects is the retailer’s failure to purchase stock in a manner that will provide a steady. even flow of merchandise to the con- sumer, without credit, and adds to bis cost of operation. One of the factors of waete in distribution is in idle merchandise of the wholesalers, it is pointed out. When this burden is permitted to develop. it must passed along to the consumer if the retailer remains in business. Overstocking by retailers repre- sents overstimulation and oversell- ing by manufacturers and wholesal- ers. the report shows. It also repre- sents, in part. the dealer’s desire to secure quantity discount the be- llef that he can more successfully meet competition by underselling competitors. In order to do this, how- ever, the report states, he must dis- pose of his merctandise in reasona- ble time or lose the earning value his capital would have if it were rapidly turned. “Free Denl” Disappearing. The “free deal,” which the mer- chandise discount is sometimes term- ed, is disappearing. the inquiry shows. The “free deal” is declared to be dis honest, as it purports to be a gift of merchandise, while as a matter of fact the price the retailer pays in- cludes a profit for the manufacturer on the entire amount of goods de livered, including that which pur- ports to be free. Recommendation is to be made in the forthcoming report to Congress that retailers co-operate more closely with community organizations wh purpose it is to imorove social, civic. commercial and industrial conditions. The report will emphasize the com- mission’s belief that the more con- sumers concentrate purchases in their community the lower will be ti local dealer: and that the consumers will be bene fited thereby through the lower prices made possible by lower selling ex-- pense. be School Savings Bank Census of Depo ors The census on school children and their savings, taken each year by the savings bank division of the American Bankers’ Assoclation, has just been started. It will cover all corners of the country and constitutes the nation’s annual authoritative test as to the progress of habits of thrift among the youngsters, the da‘'a for last year having been incorporated by the controiler of the currency of the United States in his annual report. The rapld growth of previous years, both in the number of children open- ing accounts through school savings banking systems and in their total deposits, have led to the annual re- urns being looked for with keen in- terest among the many hundréds of thousands of ckfldren participating in the movement. It i5 &xpected the numi of you lepositors this year ion mark. - -