Evening star., 1943-11-17
Flour Subsidy
Ito Curb Bread
Price Reported
Move Expected Soon
Despite House Fight
To Bar Program
By JAMES Y. NEWTON.


authoritatively today as prepared
to announce a subsidy program
on flour to hold down the con.
sumer price of bread in the face
of congressional opposition 50
strong as to cause some admin
istration leaders to concede
privately that the food subsidy
program was beaten in the
House.
Designed to relieve bakers who
are squeezed between comparatively
high wheat prices and ceilings
placed on bread by the Office of
Price Administration. the new SUBJ
sidy actually will be placed on wheat
at the mill level
Cost to the Government of the
new program was estimated at ap-
pToXimately S9,00O,000 a month, or
more than $780, 100000 a year Price
control officials declared the only
alternative is to allow an increase
in the consumer price of bread Of
Ill2 to cents a loaf.
The program is expected to bs
announced shortly by Sterilization
Director Vinson. The plan has been
worked out by Mr.. Vinson, the OPA
and the War Food Administration.
1t was said that only few details
remain to be settled by the Recon-
structlon Finance Corp, which will
finance the program.
Debate Starts Tomorrow,
An already bitter congressional
fight over the price rollback method
| Of combating imitation will boil to
an even higher pitch when the
House begins two days of general
debate tomorrow on a bill to extend
the life of the Commodity Credit
| Corp. and to outlaw consumer subsi-
! dies.
| While admitting that opposition
in the House probably is strong
enough to defeat the food subsidy
| program, administration leaders be.
| lleve sufficient votes can be mus
tered to sustain an expected veto
Of the bill.
In the new flour program, sub.
sloles will be paid only on wheat
used in making bread. a major por-
ton of annual production Mills will
be paid the difference between the
parity cost of wheat and the price
for which bread can be sold under
/ current ceilings. In the case of soft
or spring wheat, already under price
control, officials estimate there is a
scent price differential between the
cost OF wheat and the price allowed
for products made from it.
Price Control Expected.
. Shortly after announcement of the
new program, OPA is expected to
place hard or winter wheat, the bulk
OF the crop used for bread. under
price control, which will be the par.
ity price.
Wheat is fast approaching the
party level. On the Chicago mar
ket yesterday it sold only a few
cents under parity. Announcement
OF the subsidy is expected to push
the price to the parity level almost
Immediately. officials pointed out
that unless the commodity was
placed under control. the price
would 60 higher and the effect of
the subsidy would be offset.
opposed to the subsidy program
IN the House and determined to per-
nit prices Of agriculture products
to rise to what they term their
natural level at the market place.
were nearly all of the Republicans
plus a substantial bloc of Demo-
Gratis from farm States.
BowIes Outlines Problem.
On the other side were admins.
tration leaders and legislators from
districts in industrial and urban
areas. They contend that increased
food prices will force higher wages
and shatter the "hold-the line"
program
This was the theme broadcast over
the radio last night by Price Admin
istrator Chester Bowles, who pre-
dicted that abolition of subsidies
would lead to rise in all food costs,
with the result that the War Labor
Board would De unable to resist
pressure for higher wages.
Specifically he predicted milk
would go up l cent quart. butter
AZ cents a pound, cheese 3 cents
and meats 2 to cents pound.
The administrator declared ST.
5OO,0OO,0O0 year should be spent on
subsidies. Calling the present $780,
00o,OoO outlay for this purpose "a
business mans bargain" he esti-
mated subsidies had saved the people
and the Government SIS 5,000, 900. 900
which would have been added to
their bills in higher costs.
Lineup Remains Same.
There appeared but little change
IN the lineup for the stand taken
by Congress last June. Then, the
House and Senate passed a similar
Il (See SUBSIDIES. Page A-Ia0