Ceiling Trouble

One of the biggest obstacles to all-out production by the U.S. war economy is--as the Office of Price Administration is discovering--OPA's own price ceilings. Rigid prices clamped on top of rising costs are hampering the production of necessities in case after case. Last week new examples cropped up:

>In Gonzales County, Tex., one of the largest chicken-raising areas in the U.S., many chicken raisers were boarding up coops and taking jobs in shipyards. Reason: a 27.1-c--a-lb. ceiling on broilers made it impossible to cover higher feed and labor costs.

>Potato farmers in Bexar County, Tex. warned OPA that they will not plant a fall crop unless the ceiling is lifted, while around Houston they vowed to let their potatoes rot rather than market them under a ceiling of $2.50 per hundred pounds.

>Chicago meat packers complained of losing $2.30 per hog slaughtered.

>New Jersey fishermen were releasing hundreds of thousands of whiting from their sea traps. The fish would normally be frozen, but the ceiling on frozen whiting is 4-c- per pound, the cost of freezing and storing is now 5-c-.

>Following the rejection by OPA of a plea for a 35-c- rise per barrel in the price of crude oil, big South Penn Oil Co. announced a 15% cut in deliveries as of June 1.

These were only a few examples of the effects of Administrator Brown's price ceilings. Already his price ceilings had reduced the supply of meat available below the amount allowed in theory in ration books and available if prices were high enough. And his ceilings still made it impossible for many industries to go on a 48-hour week (with time and a half for the sixth day).

Only solution that OPA has yet thought of is to subsidize some essential goods, so that in spite of high cost they can be sold at low price (TIME, May 17). But last week Price Administrator Brown and Economic Stabilizer Byrnes were still far from persuading the Farm Bloc to accept subsidies. Moreover, OPA is still religiously trying to police every price in sight. One example: in the midst of all its other troubles, OPA found time last week to try to hold liquor prices under widely violated ceilings--and liquor is one of the luxuries that might well go up. OPA had yet to wake up to the fact that, where effective public buying power exceeds the supply of goods available, some prices have got to give.

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