Why Inflation?
Telecast Date: February 20, 1979
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   Now, what about you? How do you come to believe? What you believe? People have their ideas, their conceptions, and they'll stand up and fight for it. They bristle up if anyone disagrees with them. But how did they come to believe that? How do they know that what they believe is true?

   The World Tomorrow, the Worldwide Church of God, presents the World Tomorrow with Herbert W Armstrong. Ladies and gentlemen, Herbert W Armstrong.

   Do you ever stop to think how you came to believe what you believe? How did it get into your mind. You've got absolute beliefs; you've got convictions, and you're sure of it, but someone else is just as sure of the opposite of something entirely different.

   Now, how did you come to be so sure? And are you so sure after all or do you just think you are? Well, let me answer that question. Most people believe what they have been brought up to believe, especially in religion. They believe the religion that those people around them believe and what they were taught to believe and what their neighbors and, and everybody they know believes, what their peers believe and those around them.

   Now, there's another reason why people believe what they do and about other things than religion; they believe what they have repeatedly read or what they have repeatedly heard until we just accept it. As I say, I knew about that slogan, truth in advertising, which really is not the truth. And but advertising men know that people believe what they hear or see or read repeatedly.

   Now, in advertising, we have to consider broadly two different categories of the things that we advertise that are for sale. Of course, there are services and the merchandise. But your problem and your merchandizing problem is either one of education or it's one of just repeating a name until they'll buy that name.

   For instance, the cigarettes, most cigarette companies will advertise their particular brand. Now, a lot of them are using advertising to try to show you that you ought to smoke because the government makes them print something that cigarette smoking is dangerous. So now they're trying to counter that so they can stay in business, and they're gonna tell you whatever they think they can get you to believe. And they know that if they repeat it often enough, you're gonna believe it. You believe what you read.

   You see, we learn that in our educational system, people start in school, they learn to read, beginning the first grade in school, at age six, they began to get a little arithmetic and things like that at about age seven in the second grade. Pretty soon they're able to read and so, education from that time on comes largely from books and textbooks and you're expected to believe exactly what that textbook says. And if you don't, you're going to maybe be flunked or you get a, a wrong mark on that particular question makes me think of a grandson of mine when he was, I don't know whether it was the 4th, 5th, 6th grade along in there. And anyway, he was asked in class one time Larry, the teacher said who discovered America?

   Larry said, the Indians, Larry. She said, you know better than that. No, ma'am. I don't. She said, why, you know that Columbus discovered America? Well, but ma'am, weren't the Indians already here to welcome that Columbus when he got here, and the teacher flunked him. Now, that's the way our schools operate. You don't realize it.

   We're taught in our educational system. It's a system of memory training. You believe what the book says? You believe what's in print? Advertising, men know that I knew that, and I knew how to double a client's business for him in advertising. And I did it repeatedly. How long will we have this kind of thing with us? I can understand why Christ said some of the things he did.

   Well, most people believe then what they're raised up to believe or they believe what they have read what they have heard. And again, most people believe what they want to believe, and they believe what their peer group believes. Kids, for instance, believe what other kids their own age believe that they they're associated play around with much more than they believe what the parents say and your parents ought to realize that. Do your child, even up into the teenagers, the other kids, their own age have a lot more authority than you do. Unless you're very careful.

   Now, maybe you're gonna be clever enough to convince them that, you know, more than the other kids do, and I hope you succeed in that. But otherwise just be careful.

   Now, there's another thing, a lot of people believe what they want to believe, even though they might know it's not the truth, they believe it anyway. And a lot of people believe and refuse to believe what they don't want to believe. And even if you prove it to them, they won't accept it. And there's an old saying that a man convinced against his will is of the same opinion still, and he certainly is, a man convinced against his will.

   Herbert W Armstrong will return right after this message.

   Plain truth, clears up the issues. Plain truth, brightens your understanding. Plain truth, sharpens your outlook. In today's world you need the Plain Truth magazine for your free subscription to Plain truth call this toll-free number, 800-423-4444. That's 800-423-4444. See, for yourself. Plain Truth magazine.

   When there's a political election, those that are running for office, they're going to give you what you want. They want you to know that they're working for you and they're concerned about you. Yeah, they say we, I care about you. Of course, that's a, that's a good argument to talk about. If you believe it, they pose as the benefactors of the people and they're supposed to give us all of the good things.

   But the main thing that government gives us is high taxes and some more things, I guess we forget that on welfare and all that sort of thing that all of the money that the government pays out, they have to take from the taxpayers in the first place. You are bothered, not only with taxes, you're more worried about something else right now and that's inflation.

   I can tell you the reason for inflation, but the government is not going to tell you, the politicians are not going to tell you, the educators or the scientists are not going to tell you. Now that I've started, I might as well tell you, I don't know, they never believe it, but this is the truth and you can't refute it. Back in the year of 1914, early January 1914. Now that's before most of you were born.

   But I was then a correspondent of a national magazine in its editorial department. I was over traveling in Eastward New York. I had reached, I believe it was Utica, New York. I received a telegram from my publishers of the largest magazine of its type in the United States asking me to catch the next train. We didn't have airplanes, you know, at that time. Not yet, but to catch the next train back to Detroit and to interview Henry Ford that he had just instituted the sensational new $5 a day wage plan.

   And it was gigantic news, and they wanted a personal story and they wanted their own correspondent to cover it and to receive it. So I went to Detroit, I saw Henry Ford that was in 1914. Of course, he's not here any longer. But I don't know whether Edel still is or not. Tell you the truth. But at that time I found that Mr. Ford didn't know much about his $5 a day wage plan, which was a real front-page sensation in all the newspapers of the United States. At the time, you see the average union wage scale in the automobile industry was $3.75 a day.

   Now, you can see how prices have gone up since then. What you get for day to day isn't buying very much more than their $3.75 bought then. I can remember where my father, when I was a boy had been taken by a man who perhaps a little better off financially than my father was and took him to the leading hotel in our city and bought him a 50-cent lunch. And that was quite an event. Well, how much of a lunch can you get today for 50 cents? You see what's happened to money.

   That's money is escalating like a lot of other things. Well, anyway, I found that Henry Ford himself didn't know too much about it. And that a man who was the head of his sociological department. His name was John R. Lee was the man who had thought out and invented the idea, had presented it to Mr. Ford and others on the board of directors and they had approved it, Mr. Ford had approved it. So, they told Mr. Lee to go ahead and to administer it.

   So, I went to John R. Lee. I said, Mr. Lee, I've been sent here to get a story on this sensational thing that you are now paying the highest wages in the automobile industry. He says, beg pardon Mr. Armstrong, wrong. We're paying the lowest. What, why I said, isn't the union scale $3.75 a day for a 10-hour day? Yes. Yes, indeed. He said, well, haven't you now raised it to $5 a day for only a nine-hour day. Well, that's very true, Mr. Armstrong.

   Well, now, isn't that more? No, he said it isn't. He said we don't figure in proportion to just how much money we pay, we figure what we get for what we pay.

   Now we have enough volume of business and a large enough market that we are manufacturing so many more automobiles than any of the others. And we have now been able to institute the conveyor belt machine production. The car starts at one end, and as it goes along, every man has to do his part before it gets past him. We set the pace of how fast and how hard our men work, and we get twice the work out of every man for our $5 that they do for $3.75 and, and even in the nine hours, and they do a $3.75 at 10 hours, you figure who is getting the most for the smallest amount.

   We are, now that started the ball rolling. It wasn't very long until others in the automobile industry had mass machine production because the United States offered a mass market. No other nation on earth had a mass market like that at that time. No nation in Europe, they weren't as large or as populous as we were. We were then around 200 million, quite a little over that now. But we were very close to it then. Russia may have had more people than we. But they didn't, they were not a market because they, let's say per capita income over there was insignificant compared to the United States. So, they didn't offer them any market, nor China nor other nation.

   Japan is about half as large as the United States. But they didn't have that kind of a market then. Not pretty soon. All other companies in the various industries in the United States were going to mass machine production, whether it was typewriters, adding machines, refrigerators or whatever they manufactured. Now, a machine can produce so much more than a man by hand that by machines you produce. I would say more than 10 times what you can do by just a human hand. Machine production speeds it up.

   Well, I don't doubt for a minute that capital and management would have taken all the profit because it's human and they are human but labor union leaders began to see a big chance for them. Now, this world, as I've said, time after time is based on the philosophy of get. I love me. I'm wild about myself. I you remember the song back in 1924? 'Oh, I love me. I put my arms around myself and give myself a squeeze. I love me.' But I don't care anything about you.

   Now, that's why a common advertising slogan today is that we care about you. Well, you better check up and find out if that's true. It's a good advertising slogan. Well, labor unions started a series of strikes and the labor union movement got going, of course, there was much violence and maybe you remember things like the bombing of the Los Angeles Times, the Heron massacre in Illinois and some of the outrageous things that were going on. But labor got their share out of this increased profits that were coming out of the machine was producing things for us and we didn't pay the machine, you see. You just pay to get it and now it's yours. It's your slave, but you don't have to pay it wages. And the result is it was just a matter of time until labor in the United States was on a scale that was 2, 3, 4 times that of other nations.

   Herbert W Armstrong will return right after this message.

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   Now, I remember when we were starting the college over in England in the year of 1960 and I spent quite a little time over there on that year in 1960 and we had to have work done and I found that men would come to do a job for you and actually they didn't come to work, they came to coffee and took a work break once in a while. They just sort of reversed the thing. Now, I'm not kidding. They really did. And, but the average wage in England then in 1960 I found to be one third of the average wage in the United States.

   Now, Britain had already come to mass machine production, however, and the nations in Europe to the common market, and New England finally worked their way into that, have created a mass market so that they began to have a mass market and who get in the mass machine production assembly line conveyor belt type of manufacturing where the machine was doing the work. But they still had low-cost labor.

   Now, the labor unions weren't exactly asleep over there, but they weren't making the progress that they had made in the United States. And consequently, the labor, it was a low-cost labor market. In other words, the wage average was so much lower, about one-third of the United States. Now, it was about the same in France. It was even lower than that at that time in Germany. But it speeded up in Germany because they began coming back fast.

   And remember that 1960 was not too far out of World War II and Germany was pretty well down at the end of World War II, but they came back faster than any of the other nations. Well Japan began to come up very, very, very rapidly. But the last time that I saw the former Prime Minister Sato of Japan, who had become a good friend of mine, I visited him a good many times and after he was out of office once in a downtown office and once and twice out in his home, his residence. And he said to me it must have been about 5, 4 or 5 years ago, now, he said, well, he said thanks to the United States, Japan has come forward with remarkable success industrially and economically.

   But he said unfortunately, all this prosperity that has come to Japan has not yet filtered down to our laboring element and to the masses of the people. They're not getting so much yet. Now, I know it has been filtering down since that time, very, very rapidly. And Prime Minister Sato, by the way, just shortly before he died, was awarded the Nobel Peace Prize and which I know he was very happy to have.

   Well, now, now what has happened, Japan came to a mass market because Japan is exporting things to the United States. And the reason Japan has been able to have such great prosperity is because they have not had to maintain a military establishment. They have no army or navy anymore. They are relying on the United States to protect them and where our taxpayers are paying for the great military installation that is protecting all of Europe against Russia and protecting Japan against China or anyone else.

   And we don't realize it, sometimes I think that instead of Uncle Sam, we should be called Uncle Sap. Well, we're stupid. We really are. We just don't see those things. And now what are we doing? American industry has mass machine production. That's true. But with still the, the biggest cost is labor even with a machine. And we have high-priced labor. Europe and Japan. Japan was on their, their, their labor was only 1/4 out of the United States in 1960. I don't know what it is now. Maybe it's up to one-half because I know it's been scaling up. But I don't know, just to what extent but they still are a long ways from having our standard of the income or wage for labor.

   And so here we are trying to produce with high-cost labor and meet the competition of other nations that have mass machine production with low-cost labor. That is why we have inflation. Now gradually, as I say, in England, the average worker today is getting perhaps 55, 60% of the wage scale of the average American. And the result is what happens, our prices go up so your dollar doesn't buy as much as it did. We've got to get the wage scale down even with other nations one way or the other. It isn't because anyone wants to, it's just a matter of supply and demand and there's no way around it.

   And anyone that you elect as President or as your Congressman or anything else in the government, there's nothing you can do about it. It's just a fact of the way of things. We're competing with low-cost labor and we can't have the kind of thing we have and the luxuries we have in the United States and the higher living standard. While other nations have a low living standard, we nations are interdependent today, one upon another and we have exchange and we have a medium of exchange.

   The, Our medium is the dollar and Japan is the yen in Germany it's the mark, it's the pound in England. And so it goes, and the value of the dollar is going down, the value of the yen and the mark and the pound and the franc is going up. And that's the way they're gradually doing this thing. If I go to Japan now, my hotel room, the food that I eat, anything I buy is going to cost me twice what it did three years ago, simply because my American dollar will only buy about one-half as many yen as I did then. And of course, I have to transfer dollars into yen and pay in yen over there. Now, that's what we're up against.

   And I want to tell you, your Bible says that we are in for a terrible time. Right now, the government officials, our economic brains, so to speak, at least they think they are, are wrestling around with the question. Are we headed for a recession, or are we headed for a depression. A real depression or not. No one seems to think that things are going to get better now in the next year. But many think that there will be at least a recession. Let us hope it won't be worse than the last two or three, which I think we didn't feel too much.

   But I can tell you that a great one is coming because this book right here says so, and what it says is going to happen if it says it'll happen. And anyway, that through the value of the dollar and the exchange of goods and one thing and another, it's forcing the prices up in the United States. Now, wages labor unions go on strike. All they do is force the price up. They have a long strike, they lose a lot of money. They're not going to make it up, and the increased money that they got from the strike does not make it up.

   And in the meantime, up goes the price because the manufacturer has to raise its price or else go out of business one or the other because his costs go up and he has to get it and pass that on to the consumer. And if he passes it on maybe to the jobber or the wholesale market, and they pass it on to the retailer, and the retailer passes it on to you. Here, we are in a hodgepodge of confusion and we're in financial troubles and we do have high taxes, and we do have inflation, and it is not going to stop until we get an even balance with other nations, and take it from me. And incidentally, you'll find that I know what I'm talking about.

   For the free literature offered on this program, write Herbert W Armstrong Pasadena, California 91123 in Canada Box 44 Vancouver BC or in the continental United States, you may call this toll-free number 800-423-4444. That's 800-423-4444 in California dial direct 213-577-5225. The preceding program and all literature were produced by the Worldwide Church of God.

Please Note: The FREE literature offered on this program are no longer available through the Address and Phone Number given, please visit www.hwalibrary.com for all FREE literature offered on this program.

Telecast Date: February 20, 1979
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