The potters herald. [volume] (East Liverpool, Ohio) 1899-1982, 1949-09-08
BY NATHAN ROBERTSON

levidence is not conclusive, America
seems to be escaping-for the pre-
sent--the depression that some
economists feared a few month:
Iago. Unemployment is still fal
higher than it should be in a full
employment economy, but business
activity apparently is turning up
ward again, although many basic
economic maladjustments remair
uncorrected.
| If we escape a deep depression
as now seems likely barring 9
world economic crisis, it will be q
tremendous triumph for the swell
fare state" that was launched
under President Franklin ID. Roose-
velt's New Deal and carried on
under President Harry Truman's
Fair Deal. 1t will be proof of our
successful conversion from "free
enterprise" system.
For if we escape a depression
now, it will be largely due to the
action of government, rather than
business. 1t will be because gov
ernment spending and government
supports of economic system pre-
vented the development of a vic
ious downward spiral last spring
when business became panicky
and began contracting in typical
depression manner
Unquestionably we faced the
danger of a serious depression at
that time. There were unmistak-
able beginnings of Il downward
economic spiral-of the kind that
has created such havoc in other
years. Business was frightened, and
was cutting down inventories,
which slowed down production, and
resulted in unemployment. In times
past, this kind of action would have
spread quickly into a general de-
preston.
Even this time it might have de-
veloped that way, if the economy
bloc had had its way in Congress.
A sharp curtailment of government
spending, on top of the business
panic, would almost surely have
sent us into a tail spin. But Pres
ident Truman, and his economic
advisors, fought off the short
sighted economizers who were try
ing to practice Hoover economics.
Government spending continued at
a high level-and even the most
reactionary businessmen seeing the
demand for goods almost certain
to continue began to buy again.
Many labor and liberal econ
omists believed all the time that
the depression could be everted by
continued government spending, in
view of the basic supports for the
economic system erected under the
Roosevelt administration. They
felt that this system of supports
had built Il foundation for a new
kind of economic system in Am
erica, where booms and busts could
be avoided.
This viewpoint was described in
an article wrote for Harper's
Magazine last November, pointing
out that we no longer had a sys-
TEN of "free enterprise" but a new
kind of system that might be call
ed "safe enterprise" system
under which the government was
farm prices, wages,
bank accounts, mortgages, and the
purchasing power even of unem-
ployed workers, and also offering
outright government subsidies to
many industries, such as shipping
and air transport.
"What this all amounts to-" the
article said "is not free e-enterprise
system, but comparatively safe
system under which our
economic health is founded on gov
ernment credit and government
credit is used not only to battle
but to avoid it,"
At that time | did not flatly
forecast that we had rid ourselves
of booms and busts, but did say
that "many economists believe we
will never again have anything
like the crash of 1929" If we have
succeeded this year in avoiding
depression, as now appears likely,
there will be many more such econ