Evening star., 1946-07-24
New OPA Bill Seen
AS Worse Than First
Democratic Party in Congress,
Not Truman, May Pay Penalty
By David Laurence

l.
By David Lavrence
The OPA bill now being considered by
Congress In final form is worse than
the one President Truman vetoed. 1t
is worse for industry, worse for con-
sumers and worse for the country as
a whole.
The President logically should veto
it. The reasons he gave before apply
even more so from his viewpoint to the
pending measure. A resolution to con-
tinue rent control is all that Is really
needed. The country would make far
better progress If the OPA legislation,
with the exception of rent control, were
killed altogether.
Under the new measure, many Of the
food products which enter into the cost
Of living are to come from under con-
trolls before the end of the year. This
means the workers will become restless
and demand wage increases to meet the
costs of living and strikes will ensue.
To Slow Production.
AS for industry, it will suffer because
the formula puts profit control into the
hands of the OPA with instructions
virtually to squeeze the increased costs
out Of current profits. This will mean
that some businesses will not be able
to see reasonable profits ahead and this
Will slow up production. General rules,
applying equally to high and low cost
producers, means generalization of par
ticular industries
Unless there is free market and an
incentive to produce goods, the United
States cannot have its postwar recovery.
Unless the cost of living is kept down
by the laws of supply and demand,
wages will remain 'nstabilized.
Politically of course, the Republicans
gain by the confusion. The administra-
ton naturally will wish the country to
believe that it achieved something bv
the veto and by the rewriting of the
legislation. The administration, how
ever, will ensnare itself by that strategy.
For If the OPA bill is hailed as better
than its predecessor, the Nation will
assume that the President won out and
hence the cost of living should be kept
down, whereas, under the measure. it
really cannot be-
Spiral Set Up.
Actually, the Nation has not been fully
informed on the many increases in
prices which the OPA had to sanction
on account of wage increases early this
year All this was camouf1aged in the
hope of getting a renewal of OPA su-
thority and to hide the effects of the
Presidents policy In encouraging an
l8-cent-an-ho increase in wages. The
pattern set by Mr. Truman was copied
widely In industry, irrespective of the
merit of the increase in individual
categor1es. AS consequence, the in
fationary spiral set in motion by the
President had to be met by granting
increases through the OPA.
The idea that wage costs can rise
but prices cannot is the doctrine of
those who want to sabotage the private
enterprise system and encourage state
socialism or communism. Many labor
union leaders who want to take over the
management of industry with councils
such as the Soviet Union uses are
hghtlng price increases and contending
the wage costs can go up just the same.
Inc OPA controversy has created
some fallacious impressions. Consumers
have been led to believe that Congress
Is anxious to send upward the cost
OF living. Actually, Congress had been
trying to get rid of controls that oper-
ate against increases in production and
balance of supply and demand.
Gives COP an Argument.
II VIII be noted that Senator Taft.
Republican leader, signed the conference
report. He has always insisted that some
price control was better than none, He
fought to get for industry a chance to
apply prices to cover costs, but he did
not succeed. The formula is such that
industry is bound to be injured.
But Senator Taft and the other Re-
publlcans can argue next autumn that
Mr.. Truman got his price control meas
ure and prices are still high and goods
are still short and black markets still
flourish. The political strategy of the
Republicans Is understandable. They
want Mr.. truman to shoulder the blame
for the Nations economy under an ex-
tended OPA. But Mr. Truman isn't up
for denomination until 1948 and mean
while the country will have to voice
its protest in other ways.
The chances are that the Democratic
party In Congress will be hurt most by
Mr.. Truman's failure to accept the ad-
vice of his own leaders a month ago
and sign the bill that he vetoed. The
economic loss Of the last month to the
Nation, as whole, is not offset by
any appreciable gains to be derived
from the new OPA bill. Mr.. Truman
would be we'll advised to veto the bill
and carry the issue to the country in
the coming campaign It's self-defense
politics for him.