Evening star. [volume] (Washington, D.C.) 1854-1972, 1949-01-07
This is a partial tert OF Presi-
to Congress submitted today:

y
bountiful prosperity. This has en-
abled us further to strengthen oul
economy at home, and further t.
supplement the recovery of freedom.
owing peoples elsewhere who seek
lasting peace.
The resourcefulness of American
business. the skill of our labol
force, and the productivity of oul
agriculture have lifted our stand.
ards of living beyond any prewal
Expectation. We have achieved
these blessings through the happy
combination of our free institutions
our system of private enterprise
upon which we primarily rely fol
economic results. our vigorous Gov.
eminent, and the mutual respect
and trust that we all hold for one
another. My pledge to all elements
in our economic system is that their
Government will continue to steer
a course guided by full recognition
Of these values. Toward this end,
ask of all the cooperation and
confidence upon which our way Of
life depends.
Let us all remember that our
unparalleled prosperity has not been
maintained by chance, and that we
can lose it if we leave the future
to chance.
AS we work together in 1s49 to
combat the remaining dangers of
postwar imitation, we should bear
always in mind that our purpose is
at the same time to build strong
oulWarks against dehation and de-
preston, and thus to consolidate
our past gains and move forward
to new levels of sustained prosper
ity for all. " y
Economic Strength Tested.
The year just ended has tested
the strength of our economy and
/ challenged our ability and willing
ness to act to protect our prosper
lty. When 1948 opened, the in
f1atlon which had attained threat
ening proportions in the preceding
months was continuing unchecked
Prices were rising everywhere.
Early in 1913 a sharp break in
grain prices spread concern through
out the economy. Commodity spec
ulation, fed by world demand of
unprecedented magnitude and in
tenslfled by our own short corn
crop, had carried the prices of wheat
and corn to levels which could moi
be sustained. The market struc-
ture collapsed of its own weight
On February 10 the price of cash
wheat was Is per cent or IA cents
a bushel lower than it had been
month earlier.
But this break did not set off a
tram of consequences similar to
those which, following World War I,
had turned the boom into a def1a-
ton OF unusual depth and rapidity
in 1902. -
Imitation Dangers Seen.
Our escape from the danger of
a general recession in the spring of
1913 does not mean that no further
dangers will appear, or that we can
walt until they descend upon us in
full force before taking wise pre-
VentlVe measures. We have been
granted a breathing spell, but we
haev not been granted lasting pros
perlty without further effort and
vigilance.
The recent appearance of wider
areas In the economy where supply
conditions have improved, where the
pressure OF demand has been re-
duced, and where price imitation has
been halted or reversed, should be
looked upon as desirable develop
ment to be welcomed rather than
feared. 1t marks the beginning of
the process by which a more stable
condition can be reached after a
long period Of rising prices. But
these adjustments have not pro-
ceeded far enough to justify a cessa-
ton of concern about imitation. 80
l believe that prosperity can be
continued and that, with proper &C.
ton, the prospective volume of BUSH
ness investment, consumer spend
ing, and governmental transactions
should promote ample employment
opportunities for the coming
year.
These favorable prospects will not
be realized automatically. The
strength OF our economy, the
strength of our great Nation, de-
pends upon our capacity and will
ingness to adopt the salutary policies
which are required by changing cir
cumstances and to put them into
effect.
Employment Gains.
In this economic report, =. I
shall first cover the high points in
the current and prospective eco
nomic situation, and then propose
both policy guides and a program
to deal with the situation as I
evaluate it.
Employment in 1948 ranged from
81 to nearly 81 million civilian
workers and averaged more than
SO million. This included over a
million workers who were added to
the labor force. Unemployment re-
manned at the low level of around
2 million.
Production for the economy as
whole was between and per cent
higher than in 1947. With bumper
crops, agricultural output increased
about 9 per cent. Industrial output
increased per cent, while employ
ment in the service businesses rose
8 per cent and in Government
per cent
Prices ceased the broad upward
movement which had persisted with
few Interruptions ever since the re-
moval of price controls. The trends
of prices became more irregular and
more selective
| This halt in the upward march
of prices has been welcome sign
in the battle against imitation. I
hope that it proves more enduring
than similar pauses during the past
! two years.
Wages, Profits Up.
Wages went up during 1913, but
there was considerable disparity in
the increases obtained by workers
in different lines. While some
groups managed to keep ahead OF
rising living costs, others fell be-
| hind.