Evening star., 1948-03-21

trolls over nearly 10000, 900 homes 81
portance because of It's possibly gr
and on the cost of renewed defense
preparations.
On its face, the disagreement be-
tween the two houses Of Congress
centers on whether there shall be
"home rule" or Federal rule over
rents.
Economic Shock Feared
But the real issue, presumably, Is
whether rents shall be allowed to
rise more sharply with minimum
supervision and control, under local
boards, or whether q consistent
Nationwide brake on inflationary
rises shall be maintained, as in the
past, by the greater power and ia
cilities Of the Federal Government.
The House last week voted, ISL
to 1872, to support the Republican
sponsored proposal for soft" con-
trolls. The vote, however, seems
to have little political significance,
for the majority of all House DEM
ocrats also supported the plan.
The Senate, on the other hand,
rejected the proposal that controls
be turned over to local boards. In
slsting, instead, by 1925 vote. that
centralized controls should continue.
This, then, is the important dis
agreement between the two houses
of Congress-in many respects
transcending party politics-which
the conference committee is now en-
deavoring to iron out.
In case a decision to turn over
the lob to local boards should mean
destruction Of effective national
rent controls-as is freely predicted
py some persons-the jolt to tenants,
in the opinion of many economists,
probably would be violent, and the
shock to the economy severe.
The Presidents Council of Eco
nomic Advisers is known to regard
any proposal to weaken national
controls with the deepest concern
In view of the inflationary impact
it most certainly would have on the
cost of living, wages and the gen.
eral economy.
New Home Rents Soar
Repeatedly, in its economic re-
norris to the President, the council
has stressed that it believed rent
controls must be maintained until
the supply of homes has further
caught up with demand. President
Truman, in messages to Congress-
has left no doubt that he considers
continuation of rent controls an
important economic question.
While no Government official has
vet gone so far as to suggest pup
liclv that weakened rent controls
might touch off a postwar recession
highly placed economists point ou'
In this connection that skyrocket1ne
rents were an important factor II
the economic recession which came
after World War I.
Significantly, it is recalled thai
In the three years after the eno o.
World War 1 rents rose by al
average of more than as per cent
whereas in the two and half year.
since the end of World War II rents
have risen by an average OF only
about per cent.
However, the story on new con-
struction is different, for many neV
homes have been removed entirely
from rent control. Such rents have
risen more sharply even than II
the period after World War l, &C
cording to Government reports.
Tighe E. Woods, Federal rent ad'
ministrator, told the House Bank
ing and Currency Committee las
month that average monthly rent
for new units is SO per cent higher
than the average for comparable
units under rent control.
In the Metropolitan Area, TO
example, rents on new apartment
are from 40 to 60 per cent higher
in most cases than for older apart
ments, This is largely true alst
in the case Of the District itself
though rent control here is ad
ministered under separate Law
which did not decontrol new con-
struction)
Referring to rent increases on nev
properties, Mr.. Woods told the Hous'
committee:
What has happened to thes'
uncontrolled rents indicates wha
would be likely to happen to al
rents in an uncontrolled market
Control Steadily Attacked
Since the end Of the war ren
control has been under steady at
tack, though only recently has ther
been a disposition in responsible
quarters to seek its complete aboli
ton.
Previously, Congress accepted 4
recommendation of the real estat
industry to permit Is per cent in
creases when tenants agreed to sue
increases in exchange for lease
extending through 194S. New con
struction also was decontrolled. L
addition. steps were taken to brin
about a less rigid" administratio
of Federal controls.