CHAPTER VI

ABANDONMENT OF THE COST-OF-LIVING AND
SUPPLY-AND-DEMAND THEORIES

The theories of adjusting wages according to changes in
living costs or according to variations in the supply of
labor had no place in the new order of thinking. They
were soon, therefore, disregarded both in theory and in
practise, and, finally, definitely abandoned by all enlightened
 industrial interests and by all judicially-minded arbitration
 and wage-adjustment boards.

THE GENERAL CHANGE IN ATTITUDE

The representatives of labor, as already pointed out, had
always undeviatingly claimed that the idea of adjusting
wages periodically in accordance with an index of living
costs was first introduced during the war solely as a war
measure, and that it was then assented to by organized
labor only as a patriotic arrangement during a national
emergency. Under normal conditions, they had further
asserted, the only utility of a cost-of-living index was to
assure that there would be no backward step in economic
progress. During a period of rising prices, there should
be, it was declared, at least a corresponding increase in
wage rates in order that the preexisting purchasing power
of industrial workers and their families might be maintained.
 This attitude was forcibly expressed by the Executive
 Council of the American Federation of Labor in its
report for 1921, as follows :!
"1 Egeniive Council Report, A. F. of L. Proceedings, 1921, pp. 68-69.
Frog, Reding in Trade Unionism,” by David J. Saposs; New York, 1927,

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