Evening star., 1947-11-18

NSPy ~ IINffNi
families whose wages or fixed In
come has Jagged behind the increase
in prices. We have to do everything
we can to get prices down or in
crease their income. But We don't
need to surrender liberty to keep
this country on an even keel. What
emergency except a political emer-
gency iustifies making the President
an economic dictator with power to
run the lives of each businessman,
farmer, working man and housewife?
High Prices No Accident.
This high price condition Is no
accident. 1t has obviously resulted
from the policies of the administra-
ton which has controlled this Gov
ernment for the last Is years and
throughout the war. Prices are high
because demand is greater than the
supply. Although the supply is tre-
mendously increased over prewar,
the money available for spending
has increased still more. The war
was financed on imitation with a
deficit of $4,000, 100000 a year for
three or four years. The money
created then and saved by the peo-
pie is coming into the market to
buy goods.
Under lend-lease, we distributed
dollars around the world; and now
those dollars are coming back from
South America and elsewhere to buy
goods that are insufficient for our
own needs. Through the Breton
Woods fund and bank and the Brit
ish loan we have distributed more
dollars to be spent here At the
same time. we have kept Govern
ment expenses and taxes many times
higher than they were before the
war.
The administration has resisted
any attempt to .cut expenses, or cut
taxes Every cent the Government
spends puts more money into the
buyers side of the market.
The huge tax burden from this
expense amounting to about s40,-
000, 100000 a year-plus $4,000, ,000,-
600 of State and local taxes,-30 per
cent of the national income-ls a
burden on millions of taxpayers. A
lot of the taxes, however, are passed
on into the cost of manufactured
products. When you buy pair OF
shoes, you help pay the taxes of the
farmer who raises the cattle, the
livestock dealer, the packer, the
leather professor, the shoe manu-
facturer and the retailer. Probably
25 per cent of what you pay on most
articles is made up of taxes.
Export Buying Important.
Probably the most important
cause of high prices is the tre-
mendous volume of export buying.
True, we have an exceptional IN
come here at home in the United
States, but the income of our people
is practically balanced by our pro-
duction. When we impose on top of
this balance 10000, 100000 of for
eign purchases, we can hardly be
surprised that great increase in
demand outruns our supply and
forces prices up. This year we are
exporting at the rate of s20,00o,-
900, 900. and importing at the rate of
SO. 900 900 900. That means that
sl1 900 100000 of market demand
are coming from abroad with no
goods to balance them. About half
of it is balanced by taxes, but the
other half is pure imitation.
The President recommends that
we extend and strengthen. export
controls. Why. he has had power to
control exports right along. Only he
hasn't exercised it in any effective
way. He has permitted the world
TO come in with the dollars we gave
them. and bid up the price of our
goods.
Of course, we have to export to
Europe to prevent starvation and
chaos. Everybody agrees on that.
There isn't any substantial differ
ence about the necessity of doing
something at once to carry Italy
and France through the winter,
! through a short-range emergency
program. From the point Of view
Iof checking communism, this pro-
gram is essential. but 1t is more or
less useless unless we change our
policy in Germany and our policy
in China
Secretary Marshall is apparently
uninterested in saving China from
the Communists at very reasonable
cost, while advocating billions for
Western Europe His effort to re-
establish the economy of Western
Europe with American dollars is
; completely hopeless as long as he
, continues in Germany to destroy the
D.. industrial plants which alone can
: make Germany self-supporting. 1t
7 is most unfortunate that there is
not word of encouragement in this
message for those fighting against
communism in China without am
munition and with their backs to
: the wall.
5 Should Ration Others.
People seem to feel that We cam
not check exports without causing
hardship and starvation. but as a.
) matter of fact of some 10000, ,000, 900
of exports in 1947, only about 40 per
| cent 60 to Europe-$12, ,000. 900 900 go
to every other section of the world,
North America, South America, Asia
| and Africa. Surely we should ration
5 the rest of the world on steel, grain
; and oil before we even consider ra-
5 tioning our own people.
Today the Russian government
has an active commission here buy
, ing American goods and paying gold
5 for them which is better than credit,
I but just as inf1ationary. Much OF
. what Russia is buying is heavy ma
chinery, good for the manufacture
of munitions. Why does. the Presl-
dent grant export licenses for goods
of this kind, when steel and various
types of machinery are insufficient
for our own needs?
have pointed out that the tre-
mendous exports are one of the
main causes of high prices here
today. They can be cut down. In
; fact, If they continue at this pres
ent volume. they present threa:
> to the whole economy. because they
cannot possibly be maintained inde-