Evening star., 1941-08-17

tion, OF course, Is TO divert potential
spending. power from the purchase OF
goods into the Treasury by taxes and
purchase Of Government securities.
This is being done, and the pending tax
bill is just foretaste OF what is expected
next year and the year after. The de-
Tense bond drive is another phase of this
solution.
The pending tax bill contains several
provisions designed to reduce consump-
ton and next years bill will contain
more. The excise taxes are in effect
sales taxes, and the proposed per cent
levy on automobiles, which may be
raised in the Senate, will make the con-
sumner pay more for a motorcar Con-
sumption may be cut down and the
Treasury will get the money that would
have gone to the manufacturer had he
been allowed to raise the price to meet
demand.
There is also the proposed tax on radio
advertising One theory behind this is
that if advertising increases consump-
tion, lack of 1t will decrease consumer
buying
The Presidents recommendation t.
curb installment buying as means of
cutting down consumption has already
reused tie opposition Of the National
Chamber of Commerce which insists
that governmental control is unneces-
sary.
Time Payments Defended.
Apparently" says the chamber, con-
sumers are currently spending approxi-
mately $1,000 900 900 annually for goods
purchased on the installment plan
Such goods are principally durable in
character. such as automobiles, furni-
ture. household appliances and radios.
In view of the recognized utility of
installment credit to persons of low in
come, in view of the relatively small
volume of installment sales in relation
to all retail sales. and in view of the
availability of other forms of consumer
credits, it is diffieult to understand why
there has been discussion of proposals
to place limitation on installment selling
through regulatory measures admins
tered by governmental agencies
II serious attempt is made to curb
installment buying, including or not in
cluding housing. it will meet with con-
gressional opposition. The theory be-
hind such restriction is that. in addition
to reducing purchases and hence keeping
down prices, backlog of demand will be
created for the postwar period when
industry goes back to peacetime basis.
In practice. however, the restriction
would hit hardest the low income groups,
now ardently represented in Congress,
and would not materially affect the pur-
chases of the rich and moderately well
to do who have savings or adequate bank
credit.
Other Purchase Curbs.
More universal curbs on purchases
are direct governmental restrictions on
output either by fiat, as Mr., Henderson
is doing with automobiles, or by priori-
ties, as administered by Edward r.
Stettinius, jr.
Another method, which would apply
to all, is enforced use of substitutes. as
plastics for aluminium, cotton for silk,
sports for pleasure driving, band con-
certs and dancing instead of radio
listening.
The forthcoming debate on the price
control bill undoubtedly will bring out
most of the disadvantages of govern
mental regulation of spending. But
prosperity, with its increased employ
ment and greater national income, has
its problems. 1t would be interesting if
each opponent of control would give the
whole of the picture by relating what
consequences his proposal or substitute
would have on the subject vital to every
wage and salaries worker, the rising cost
of living.
If there is a better way than govern
mental control, it has not yet been
given to the country.