The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1934-03-13

a project of Iong-term recognition.
4 FAILURE to grasp that truth,
L n an attempt to use NRA as a
major instrument in producing re-
covery from unemployment, is al
most certain to retard recovery and
endanger the public support of the
far-reaching possibilities of NRA
itself. I know that General john
son has figures which he thinks
prove that the attempt last August
and September to use MIRA to pro-
mote employment by wholesale
method was a success. But this view
is rot shared by many competent
men in Washington and elsewhere,
who are fully as liberal as Cen
eral johnson and just as indis-
putably devoted to the new deal,
both in its immediate and its longer
detectives.
1t may be a coincidence, but the
coincidence happened, that as a
hostile critic has put it: Last
years business revival took place
before the codes went into effect;
the summer reaction occurred dur
ing the peak Of NRA power and
prestige; the current revival in bust
ness began when the NRA was COM
paratively quiescent." There is no
reason to think that the MIRA was
the main cause of the slump of
August to october, but the evidence
at the time seemed to point to the
conclusion that while agricultural
prices were falling, owing to the alb
sence of monetary control, manu-
featuring prices were raised under
the pressure of NRA; that this ag-
gravated the farm problem, caused
something like a buyers strike, and
that this in its turn caused unem-
plCyment to increase and production
to be retarded.
1t is fact that the first three
weeks of october we're the most
critical which have confronted the
administration since it surmounted
the bank crisis of March. l should
suppose that the administration
would be very hesitant indeed to
open wide again the thrOttles of
NRA and repeat last summers eX-
pertinent with the blue eagle cam
paign.
1t ought to have better evidence,
more careful and complete and con-
elusive figures than are now avail
able, to show that its previous at
tempt at artificial wholesale re-em-
ployment did not, in fact, promote
unemployment in industry and a
greater disparity for agriculture.
y Il
THE past years experience seems
i to me to have shown with con-
siderable deiniteness that monetary
management, in the broadeSt sense,
has induced recovery and that pub
lie control, through agricultural adj
juStment administration and NRA.
has contributed little to recovery.
though il may, and probably will.
contribute greatly to economic re-
construction.
Monetary management has COM
priSed the external reValuatlOn Of
the dollar and the pumping out Of
inflationary expenditure to farmers
and the unemployed, to bank de-
poSitors and to debtors on mort
gage. These measures have tended
to correct the distortion of the
price structure, raising prices that
most needed to be raised, putting
money in the hands of those who
would spend it most quickly, exert
ing pressure upon hoarders and
upon those seeking to keep their
fund liquid and out of use.
There can be little doubt that
these measures as a whole, aiken
at time when the natural forces
for recovery were favorable, have
had powerful effect. They raise
problems for the future. There are
dangers in these measures. But
their immediate influence has been
unmistakable. The first period of
recovery in the spring followed
speculative anticipation Of an infla-
tionary policy. The slump of the
late summer came with the col
lapse of the speculation and an ap-
parent abandonment of inflationary
measures. The revival of the late
autumn and winter came with the
revaluation of the dollar and the
quick expenditure of government
funds.
On the other hand it is very
difficult to find clear evidence that
agricultural adjustment admins
tration, apart from the FUNDS it has
pumped out to the farmers, or
NRA, apart from the modest
amount of unemployment relief
which it succeeded in compelling
employers to provide, have made
any immediate and decisive contri-
button to the restoration Of an eco
nOmic balance in the country as a
whole.
THEY have IN die d some
i abuses. They have stabilized
some industries. But in so far as
they have worked through restric-
ton of output and semi-mono-
polistic methods of price fixing,
they have, believe, interfered with
the readjustment Of the price struc-
ture which the monetary policies
were bringing about.
If that is the lesson of our ex-
perience in the past year, then the
prudent and wise policy is to be
frank in treating NRA and agri-
cultural adjustment administration
as long term projects Of reconstruct
ton and not as instruments of i'm
mediate recovery. General Johnson
might well consider the example
being set by Secretary Wallace,
who with the agricultural adjust
ment administration operating in
his department, seems to have no
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