More interesting was opinion on middlemen and prices. Taken as a whole, opinion was hostile to the middleman. His function, and his hard work in bringing buyer and seller together, were ignored; profits were not regarded as a reward for labour, but as the result of sharp practices. Despite the fact that his very existence was proof to the contrary, the middleman was held to be redundant in view of the existence of an official Shop and the Exchange and Mart. Appreciation only came his way when he was willing to advance the price of a sugar ration, or to buy goods spot and carry them against a future sale. In these cases the element of risk was obvious to all, and the convenience of the service was felt to merit some reward. Particularly unpopular was the middleman with an element of monopoly, the man who contacted the ration waggon driver, or the man who utilised his knowledge of Urdu. And middlemen as a group were blamed for reducing prices. Opinion notwithstanding, most people dealt with a middleman, whether consciously or unconsciously, at some time or another.
There was a strong feeling that everything had its "just price" in cigarettes. While the assessment of the just price, which incidentally varied between camps, was impossible of explanation, this price was nevertheless pretty closely known. It can best be defined as the price usually fetched by an article in good times when cigarettes were plentiful. The "just price" changed slowly; it was unaffected by short-term variations in supply, and while opinion might be resigned to departures from the "just price," a strong feeling of resentment persisted. A more satisfactory definition of the "just price" is impossible. Everyone knew what it was, though no one could explain why it should be so.
As soon as prices began to fall with a cigarette shortage, a clamour arose, particularly against those who held reserves and who bought at reduced prices. Sellers at cut prices were criticised and their activities referred to as the black market. In every period of dearth the explosive question of "should non-smokers receive a cigarette ration?" was discussed to profitless length. Unfortunately, it was the non-smoker, or the light smoker with his reserves, along with the hated middleman, who weathered the storm most easily.
The popularity of the price-fixing scheme, and such success as it enjoyed, were undoubtedly the result of this body of opinion. On several occasions the fall of prices was delayed by the general support given to the recommended scale. The onset of deflation was marked by a period of
sluggish trade; prices stayed up but no one bought. Then prices fell on the black market, and the volume of trade revived in that quarter. Even when the recommended scale was revised, the volume of trade in the Shop would remain low. Opinion was always overruled by the hard facts of the market.
Curious arguments were advanced to justify price fixing. The recommended prices were in some way related to the calorific values of the foods offered: hence some were overvalued and never sold at these prices. One argument ran as follows:—not everyone has private cigarette parcels: thus, when prices were high and trade good in the summer of 1944, only the lucky rich could buy. This was unfair to the man with few cigarettes.
When prices fell in the following winter, prices should be pegged high so that the rich, who had enjoyed life in the summer, should put many cigarettes into circulation. The fact that those who sold to the rich in the summer had also enjoyed life then, and the fact that in the winter there was always someone willing to sell at low prices were ignored. Such arguments were hotly debated each night after the approach of Allied aircraft extinguished all lights at 8 P.M. But prices moved with the supply of cigarettes, and refused to stay fixed in accordance with a theory of ethics.
Conclusion The economic organisation described was both elaborate and smoothworking in the summer of 1944. Then came the August cuts and deflation.
Prices fell, rallied with deliveries of cigarette parcels in September and December, and fell again. In January, 1945, supplies of Red Cross cigarettes ran out: and prices slumped still further: in February the supplies of food parcels were exhausted and the depression became a blizzard. Food, itself scarce, was almost given away in order to meet the non-monetary demand for cigarettes. Laundries ceased to operate, or worked for Js or RMk.s: food and cigarettes sold for fancy prices in Ls, hitherto unheard of. The Restaurant was a memory and the BMk. a joke. The Shop was empty and the Exchange and Mart notices were full of unaccepted offers for cigarettes. Barter increased in volume, becoming a larger proportion of a smaller volume of trade. This, the first serious and prolonged food shortage in the writer's experience, caused the price structure to change again, partly because German rations were not easily divisible. A margarine ration gradually sank in value until it exchanged directly for a treacle ration. Sugar slumped sadly. Only bread retained its value. Several thousand cigarettes, the capital of the Shop, were distributed without any noticeable effect. A few fractional parcel and cigarette issues, such as onesixth of a parcel and twelve cigarettes each, led to monetary price recoveries and feverish trade, especially when they coincided with good news from the Western Front, but the general position remained unaltered.
By April, 1945, chaos had replaced order in the economic sphere: sales were difficult, prices lacked stability. Economics has been defined as the science of distributing limited means among unlimited and competing ends. On 12th April, with the arrival of elements of the 30th U.S. Infantry Division, the ushering in of an age of plenty demonstrated the hypothesis that with infinite means economic organisation and activity would be redundant, as every want could be satisfied without effort.