The Waterbury Democrat., 1943-06-10

to keep prices down.
 Granting that something needs to be done about OPA's food pro- gram if there is to be effective price control, transfer of this job to War Food Administration isn't it. At first glance such a transfer might seem to tend towards simplification ant. centralization of control under single agency in the interests of greater efficiency. That would put food production, food distribution and food retail price control all under the same roof and the same boss who would thus become a real food administrator. But the War Food Administration is giving no support whatever to such reorgan- ization and the Office of Price Ad- miniStration planners go so far as to say officially that if food price control were given to WFA, it would mean the end of food price control and the sky would be the limit on imitation.
 DAVIS AND
 PRICE CONTROL
 Chester C. Davis, the war food administrator, isn't power grabber. His reputation, built up in various Washington jobs, is that of an ad- ministrator who works in whatever harness is put on him. That may ex- plain why he has not promoted the idea of putting food price control under his supervision, but 1t also follows that if Congress or the Pres ident were to assign him the job, he would take it and try to do some thing about it.
 The Davis idea on price control. as revealed in his actions during the less than three months he has been war food administrator, diff e r vastly from the current trend of thought at OPA. Davis has said that he is for whatever formula was ordered to hold prices-meaning that he would go down the line on policies adopted by Congress or the Office of Economic Stabilization.
 He has, however, expressed his opposition to controls which re- quire a lot of policing. He has been criticized by OPA for not putting ceilings on livestock. He is doubt ful about the advisability of putting ceiling prices on beef cattle at the farm level because of the many grades on the market and the fear that price ceilings would induce up- grading, which would simply be an- other form or inflation-loWer qual- ity for the same money. On live hogs, he was able to bring down the price by manipulating the storage prices on corn so that 1t would not be held by farmers in anticipation of higher prices, but would move to market. The corn being thus reduc- ed, the price of hogs came down in ratio. Th,t was price control without elaborate policing.
 BLACK MARKET
 STIMULATION
 Davis believes that subsidies in some cases are useful, but that any reliance on the widespread use of subsidies to stave off imitation is you subsidize scarce goods, lowering miSconception. He reasons that If their prices, all you do is increase the purchasing power, which stimu- lates black markets.
 He believes in keeping farm price levels which will support retail prices and induce production. He does not favor the incentive pay ment plan which the Department of Agriculture sponsored earlier in the year, to stimulate the growing of more oil crops like peanuts, soy beans and flax. Congress turned that plan down. Davis, instead, favors the support price plan Of the Commodity Credit Corporation, by which the farmer gets assurance Of better prices for his entire produc- ton from acreage devoted to war products like the oil-bearing crops than he would get from acreage de- voted to wheat, corn or cotton.
 The keystone of the entire Davis anti-inflationary philosophy is high CT taxation and greater war savings. It will be recalled that he has ben a Federal Reserve bank official. His idea is that if more of this $40 bil- lions of excess purchasing power - the wel-known inflationary gap-is drawn off in the form of higher taxes and more war bond purchases, the money simply won't be there to spend on the black market. And with excess p lrchasing power drain ed off in this way, prices will tend to keep themselves in control.