“Says Profits, Not Wages, Have Raised the Cost of Living”

Headline: “Says Profits, Not Wages, Have Raised the Cost of Living”

MINNEAPOLIS — In a Labor Day speech here Senator Shipstead disproved by Government statistics that the high cost of living is due to high wages paid organized labor.

“The wage earner has found that his share of the wealth he produced has dropped 30 per cent in six years, the income of the farmer has decreased 42 per cent and the income of large corporations increased 70 per cent,” said Senator Shipstead. “These profits are not taken out of the air,” he said.

“Increased productivity is largely due to labor-saving machinery. There is no longer controversy as to what class produces wealth. But there is a controversy as to distribution.

“Statistics of the Department of Labor show that employment dropped 18 per cent during the period from 1920 to 1926. During the same period, the average monthly pay roll dropped 30 1-10 per cent. The average working man is producing 34 per cent more finished product than seven years ago. He is producing one-third more because of labor-saving machinery.

“At the same time, according to Secretary Hoover, the earnings of 25 per cent of the largest corporations increased to 70 per cent. In August, Roger Babson, the business statistician, declared that in six years the average price of the stock of 20 of the largest corporations increased from $64 to $177.

“On the iron range, north of Duluth, more ore was shipped last year than ever before, with 6,000 less men employed than previously.

“From 1920 to 1925 there was a greater shortage of food all over the world than ever before. Three times as much agricultural products were exported from this country than ever before. But in those six years the income of the farmers dropped 42 per cent.”