204 INDUSTRIAL REVOLUTION AND WAGES
Secretary Davis has further advocated the raising of the
wages of unskilled workers as well as all other classes of
wage-earners as a means of increasing purchasing power
and prosperity. In his Annual Report for the fiscal year
1927, he said :*
As I have repeatedly pointed out, our home market means
the purchasing power of the workingman, and his purchasing
power means the relation of his wages to production and
price. Our relatively small exports, when measured in percentage
of the whole of production, must emphasize to any
thinking man the fact that in home market, not in exports,
lies the safety of American industry and American business.
The way to enlarge the home market is to enlarge the purchasing
power of the vast majority of persons who constitute
that market; that is to say, the workers.
I have pointed to the fact that so long as the worker is paid
in proportion to his greater productiveness, no fear need be
felt for the high-speed automatic machinery that is constantly
being introduced into industry. It is everlastingly to the
credit of the American worker that he has made the most
willing use of this machinery, in full confidence that he will
receive, in wages, his due share of this greater machine production.
I must also credit the American employer, who, in
general, has seen good business in paying good wages, and
has willingly paid them, in full confidence that he can count
on maximum output from his employees. It is this mutual
willingness of the worker to produce and of the employer to
pay for production that accounts in large measure for our
present prosperity. It has crowded our home market with
millions of ready consumers and buyers; it has stocked that
market with infinite variety of good for improving their
standard of living. . . .
The low-wage fallacy is the worst of all. A dullard must
see the folly of killing the purchasing power of the greatest
1 Annual Report of the Secretary of Labor, 1927, Part II—Comments and
Recommendations; The Worker's Estate, pp. 137-144.
