Evening star. [volume] (Washington, D.C.) 1854-1972, 1949-01-07
It of President 7rumons Economic Report to Conqres

smum prOduCC1On IN an expanding
economy and to limit programs re.
lated to national security.
I recommend immediate legisla
ton to deal with this problem O.
capacity and supply 1t should i'm.
pose upon the Government the spe.
cif1c responsibility and provide the
funds to make careful surveys Of
future supply needs and productive
capacity. 1t should further require
hat these specific, studies be CORE.
lated with the general requirement.
Of an economy operating at maxi
mum employment production anc
purchasing power. To the extent
that facts reveal the need, it should
provide additional authority to dea
more effectively with inadequacy OF
capacity and supply.
ALLEGATION poWers-In my eco
nomic report of last year, stressed
the need for the experimentation Of
voluntary action with mandatory
controls over key materials in short
supply. The need for mandatory
controls still exists. I propose the
! temporary extension of the law
under which voluntary agreements
are now permitted. However, there
is grave danger that the problems
OF acute shortage cannot be ade-
quately met by voluntary agree
ments. I therefore recommend that
the use of mandatory ALLEGATION
powers be authorized so that they
may be employed on a selective basis
without delay where they prove to
be needed.
l also recommend that the Con-
gress continue the priorities and
ALLEGATION authority in the field of
railroad transportation.
| Price, Wage Controls.
Selective price and related wage
controls-I recommend that selective
price control authority should
promptly be made available to the
Government. My reasons for this
have repeatedly been set before the
Congress and the country. 1 have
not earlier and do not now propose
general or overall price control of
the wartime variety. g
| Legislation to authorize selective
price control should encourage vol.
untary adjustments without thu
actual imposition of price control
IL is IN this spirit that would adj
minister the authority. Il
should be supplemented with a pro.
vision permitting the Government
to order the Withholding of price
advances for a reasonable perioc
while public inquiry into their justi-
ncatlon is being made.
In my message to the special ses-
sion OF the Congress in July, 1948.
said: Where the Government i'm.
poses a price ceiling, wage adjust.
ments which can be absorbed within
the price ceiling should not be in.
terfered with by the Government
The Government. should have the
authority. however, to limit wage
adjustments which would force {
break in a price ceiling, except
where wage adjustments are essen
tial TO remedy hardship. to correc,
IlnequitieS, or to prevent an actua
lowering of living Standards
then stated my belief, which l still
firmly hold, that wage increase:
based upon productivity and &c.
signed to provide rising standard
of living embody the American way
The facts show some current sit
uations where non-i nflationary wage
increases can be granted by en-
ployers without price increases.
firmly believe that the norma
processes of collective bargaining
will result in sound wage adjust
ments without the actual applica-
ton of any governmental authority
related to wages if business and
Government make genuine efforts tc
ho.a down excessive prices anc
profits ana to reduce the cost oil
living
Two-Year Rent Control.
Rent control-The present hous-
ing shortage makes it necessary to
continue rent control for at least
two years, and to strengthen its en-.
forcement. I recommend that this
be done.
Even if the most optimistic inter-
probation is placed upon the slight
reduction in the cost of living in re-
cent months, it would be unwise tc
lift living costs again by rent in
creases even larger than the mod
crate ones taking place under the
present system of control Such a
course would inflict further hard
ship upon the families who have
already been the prime victims of
imitation, and would make it harder
to exercise moderation in wage de-
mandS
Export controls-In view OF the
large volume of exports required to
carry out our program of aiding eco
nomic reconstruction abroad, it is
essential that those exports be con-
trolied, both to minimize their da-
verse impact on the domestic econ
omy and to make them most fully
comfortable to our foreign policies.
therefore recommend that the eX-
istlng powers of control over exports
be extended, and that the machinery
for enforcement be strengthened.
Commodity exchanges - Excessive
speculation in grains, cotton and
other agricultural commodities re-
suits in wide and harmful fuctua-
items in prices The experience in
the fall of l947, and in the winter
and spring of 1913, demonstrated the
need for more effective govern
mental supervision over speculative
trading on the commodity ex-
changes. I recommend that the
Congress grant more specific and
more adequate authority to prevent
excessive speculation or the manipu-
lation of prices.
Higher Minimum Wage.
While we are fighting further in
flation, we should recognize that Sc
we're hardship has already been i'm
posed on those whose incomes have
Jagged far behind the increase in
the cost of living Whatever is
feasible to alleviate this hardship
should be accomplished without de-
lay. I recommend specifically:
That the benefits under the
old-age and survivors insurance
be substantially increased in or
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