Toledo union journal. [volume] (Toledo, Ohio) 1942-current, 1949-05-06

says, the CIO warned that
there is no comfort in the
pious promise of business
leaders that initiation will end
with a general softening of de-
mand which will reduce prices.
When this happens, there will
also be a softening of production
and the employment it sustains.
We. cannot wait for the cure that
kills the patient. After eight un-
interrupted years of wartime
boom, uncertainty now besetS
the economy. While still bring
ing to their readers the latest
spectacular summaries of 1948
profits, our business journals are
telling of tagging retail sales, de-
clining residential hou in g
starts, and falling business loans
in 1949."
The policy of letting nature
take its course is leading US
down the road to reduced pro-
duction and employment, says
the Outlook, and if economic de-
cline is to be reversed and pre-
vented from turning into large
scale recession or depression,
"every effort must be made to
increase the dollars available for
consumption on the one hand
while a reduction in inflated
price levels is brought about.
Only in this way can the gap
between purchasing power and
maximum output be closed. "
At the wars end in 1945 pros
poets for a great American pros
perity were high indeed, the
Outlook says. AS a result of the
economic progress made by the
lower income group in the war
years, the American people
found that never had they been
more solvent and never had the
economy been so primed to pro-
duce abundance. The problem
was to keep the economy pro-
ducing and d distri b ut / n 6 its
potential output TO meet the
needs of America"
But in postwar situation call
ing for restraint, with great pur-
chasing pressure still pent up as
a result of wartime savings and
shortages of goods, "all the ele-
ments for an explosion were
present and Big Business struck
the match. The scuttling of
price controls in 1946 set the
stage for the grestest profit
taking in history.
"And the chief victim of the
spiraling prices of unchecked in
flation was the average Ameri-
can family"
The Outlook further sta tie S
that
Between 1945 and 1948, real
weekly wages fell in the path
of skyrocketing prices. The share
of wage and salary workers in
the total national income which
had risen from 81 per cent in
194l to SO per cent in 1945 and
given hope for sstained full en-
ployment in the future, fell
back to 81 per cent by l948,
During this period the Ameri-
can people managed to sustain
a good part of their consumption
by saving less and by liquidating
past savings. Purchases of +
bonds, the so-called peoples S
bonds, totaled $l5.5 billion in
the 1945 fiscal year, but fell off
to about S4 billion in l948." But
in l945 about 70 per cent of the
total value Of the bonds sold
were in $25, $50, and 500 de-
nominations; by 1948 the share
of these denominations fell to
only Al per cent, BY l948, five to
six million American families
had liquidated their last bonds
and 25 million American fami-
lies, more than one-half of the
total, owend no bonds at all.
During the same period, many
Americans sustained their living
standards by going into debt and
consumer debts rose from SIS II
billion on vi Day to SIC billion
by the end of 1948.
Even with increased savings
and consumer debt. expenditures
absorbed only 20 per cent of the
total national output of goods in
l948 as compared with rs per
cent in 1929 and rs per cent in
1899.