Evening star., 1941-07-06

and to some extent price-f1xing policy.
1t is almost certain that Congress
would not enact legislation establishing
the price ceiling advocated by Mr..
Baruch. The farm and labor blocs in
both houses would combine to defeat it.
Even Mr. Hendersons voluntary plan
of selective control has aroused an
organized farm bloc headed by Senator
Smith of South Carolina and Senator
Thomas of Oklahoma.
The tremendous expenditures of the
defense program require heavy taxa
ton. The success of this tax program
depends on large corporation profits,
high individual incomes and extensive
production of consumer goods on which
excises can be levied.
High Taxes Aid Labor Claims.
The high corporation taxes on in
creased profits, however, occasionally
play indirectly into the hands of labor
leaders who can show that If a particu-
lar employer does not increase wage
rates. he will have to give most of his
profits to the Government. The Brook
ings idea is that the price of products
should be lowered when profits are rising,
thereby increasing real wages. This
policy would also permit the Govern
ment to buy what it needs at lower
price and thereby decrease expenditures.
1t would, however, cut down the Gov
ernment cash receipts. Apparently the
solution here is to find the point at
which the Government can make pur-
chases at a reasonable price and at the
same time get revenue.
Mr.. Henderson and Donald M. Nelson,
o. P. NJ. director of purchases, who have
a more direct power over prices than
any other Washington officials, concede
that no national policy has yet emerged
and that most of what may ultimately
become policies are still at stage where
they more properly can be described as
issues"
Price Control Aims Defined
For their own organizations, they say
they seek the following:
/. To increase production as rapidly as
possible.
IL ilolu 0OWi lliC SOoS Va tAlO AS-
armament program for future genera
tions.
g. To prevent price spiraling leading
to imitation.
4. To preserve public morale by pre-
venting the spectacle of profiteering on
the part of a few.
Policies thus far adopted sufficiently
clearly to be stated, they say, are these:
/. Wherever possible, the voluntary
cooperation of businessmen shall be
enlisted in the task'o preventing price
advances.
2. No price advance shall be prevented
when it is contributing to our prime OBJ
jective of increasing production and is
not, at the same time, working against
our other objectives in any significant
fashion.
8. A full and complete explanation of
our reason for every step in price adj
ministration shall be given both to those
concerned directly and to the general
public.
4. Whenever our attention is called to
a particular commodity, we shall bring
the fact that we are concerned about it
to the attention of the industry.
5. We shall always provide freely for
a modification of decisions if new facts
are brought to our attention or if con-
ditions change.
6. Once decisions have been made.
we shall utilize every means within our
power to see that they are carried out.
Labor Participation Seen.
What will be the eventual national
policy on the control of production and
prices? Mr. Henderson, in the July
issue of Fortune magazine, under the
title of 1--WE Have Only Months" pre-
diets major reorganization in the
American economy with an end of
business as usual" He foresees strong
industrial committees advising with de-
fense commodity groups to carry out
ALLEGATIONS and to achieve many goals
that necessitate industrial cooperation.
When requirements are known" he
writes, both for time and amount,
labor supply will be scheduled. I FORE
see labor's active cooperation in the
standardization of wage rates and the
extension of mediation machinery, per-
haps some arbitration. But above ALL
I expect to see, when the load and goal
are known, clear, unreserved accept
ance of responsibility for production by
labor, with added participation in
planning"