The times-news. [volume] (Hendersonville, N.C.) 1927-current, 1937-01-12
BRoOKINGS INSTITUTION ON
ECONOMIC CONDITIONS

ing to the Washington correspondent OF
The Greensboro News, periodically has
made a contribution of great value to the
discussion of the economic and social al
fairs of the nation" has issued statement
on nationwide conditions. The Institution
has not receded from its formerly public
lied view that the safety of the country lies
in production of generous proportions IN
every line and that the economy OF scare
ity, preached by some economists and poll
ticians, is dangerous and if carried to logl-
cal ends would badly cripple or wreck the
country.
The Institution presents some conclusions
as to general conditions and sums up the
essential requirements for consistent
program of further recovery in the fol-
lowing paragraphs, which merit the close
attention and study of all who desire to be
equipped with some understanding OF the
position and problems of the country to-
day:
Listed among the unfavorable factors in the
present situation are the absence Of fiscal stability
the social economic and political pressures for more
government spending, together with some evidences
of an inflationary movement Emerging labor poll
vies the institution also fears have the effect
of retarding the recovery process, one such poicy
being the demand for reduction Of working hours
on the mistaken theory that we can thus raise
standards of living"
There is the added warning: "The sharp rise in
costs unrelated to efficiency, would be certain to
result either in rapid rises in industrial prices, with
profoundly disturbing effects upon the operation
of the economic system as a whole, the imme-
date hating of business activity with consequent
increase in unemployment. The struggle now 60
ing on within the ranks of labor over conficting
theories of labor organization and the intensive ell
forts being made to strengthen the power of labor
over industry constitute serious menace to the
continuance of business prosperity.
'll-conceived industrial legislation would also
serve to check the recovery movement. Current
discussions and preliminary drafts of Legislative
measures indicate at and the same time a laud-
able desire to safeguard public welfare through
legislative provisions with respect to Industrial
practices price policies wages hours of work, out
put capital expansion, etc, and endless confusion
and conflicts of opinion as to the regulatory poll
cies that would bring about the desired results
Premature legislation along these lines would give
FINALLY, mention must be made of highly unsta-
bic elements in the international situation. In
many countries the expansion of business activity
has not been built on sound foundations. In nu
merous instances it is largely attributable to mill
tary programs which, while they generate temper
ary business prosperity, do not directly raise stand
ards of living or increase wealth producing capae
itv. They involve at the same time vast expendi
lures of public funds which simultaneously increase
the burdens of taxation and threaten financial sta
bility The condition of public finance In the worlt
nj large constitutes q fundamental factor OF IN
stability everywhere. A new series OF fiscal an'
currency breakdowns with adverse effects upoi
American trade and finance is quite within th'
bounds of possibility. The threat of new wars no
only forecasts the possibility of renewed wealth
destruction, but also constitutes barrier to tn
reestablishment of constructive international eco
nomc policies. The present recovery movement
unique in this regard.
an brief. the essential requirements for a con
sistent program of further recovery may be sum
married. as follows:
"The re-establshment of balanced fedora
budget as a foundation on which to build enduring
progress.
.sThe continuance of the present policy of main
tanning fixed price of gold and the establishment
through international cooperation OF system 0
stable foreign exchanges
'sThe extension Of the program Of reciproca
trade agreements as the most practical means o
reducing artificial barriers to commerce and re
opening the channels of international trade.
'sThe preservation of the generally favorabh
ratio of prices and wage rates, in the interest
progressively expanding the real purchasing powe
of workers and creating demand for added p'