Evening star., 1947-12-26

pretty terrible Frank r. Kent.
indictment but it happens to be true.
Oh, everybody has plan" The
President has a plan; the Republi-
cans have a plan; the CIO has a
plan; Mr.. Stassen has a plan; Mr..
Eccles has a plan; Mr.. Wallace has
plan, and the Council of Economic
Advisers, highly favored by the ex-
tremely New Dealish Leon Key
serling, now recognized as the most
influential White House inner
circle" adviser, has plan. There
are plenty of plans. The trouble is
that they all have twelve toes or
three thumbs or otherwise are alb
normal, subnormal and piecemeal.
Not one of them clicks. Not one Of
them will work, and in a number
of cases their sponsors know they
will not work-and know why.
Fundamentals Avoided.
The reason is simple. Not one of
them deals with the fundamental
factors. On the contrary, these are
deliberately and almost completely
evaded and avoided. Indisputably,
too much money and too little goods
Is the basic cause for imitation.
Indisputably, the great cure for
this condition is to diminish the
quantity of money or credit and in
crease the quantity of goods. In the
last analysis, increased production
is the answer. A hundred times
Bernard M. Baruch has pointed this
out. No economist worthy of the
name disagrees. Yet, no political
leader dwells on that fact, because
to do so means to tackle the labor
problem.
And particularly IN an election
year, they all shy away from that.
Yet, nothing possibly could be
clearer than that unless something
is done effectively to halt the spiral
Of higher wages and higher prices,
imitation may be pushed beyond the
edge of control in the spring by the
third wave of wage demands, of
which notice already has been given.
Not only will the strikes with which
the demands will be followed halt
production, but when the inevitable
compromise is reached higher prices
are just as inevitable. It has all the
promise of a repetition of that first
wave of strikes which dealt so hard
a blow to production in 1916 and for
which President Truman, having
first supported the IS per cent rise
in wages, then sanctioned a IS in
crease in the price Of steel, was
largely responsible.
This was the pattern followed all
down the line. 1t was repeated
year later when the second general
wage demand came. Now, with
everybody talking about the neces-
sity of bringing prices down to check
imitation and the danger Of not
doing so too clear to miss, the third
wave is just around the corner. The
results Of another series of strikes,
leading to a further rise in prices,
concededly will be disastrous. The
increased cost Of living again will
be more money and less goods. In
brief, nothing could more effectively
feed the inf1ationary fires. i
Effect on Marshall Plan.
The most serious consequence, OF
course, will be the effect on the
Marshall plan. There is almost gen.
eral agreement that the economic
recovery of Europe is vital to our
own economic health and that, great
as the burden may be, 1t is sheer en-
lightened selfishness to go the limit
In extending material and financial
aid. The ultimate cost will be q
good many billions of dollars. No
one can do more than estimate. We
do know that even at the present
price level 1t viii impose Q very
heavy strain-considerably heavier