Evening star., 1949-12-30
Another Depression
Could Wreck j. s.,
Report 10 Truman Says
By Joseph A. Fox

S~SSF" '" w
Another depression. similar to
that of the sos could wreck this
Government. in the opinion Of
President Truman's top economic
advisers.
In report to the President last
night, which argued for greater
stability in Federal economic
policies, the council of Economic
Advisers, which charts employ
ment and production tren d,s
stressed the inherent stability OF
the American economic system
pointed out that it rode through
the stresses of the great depres-
sion," and added that nothing
less than another depression even
more devastating" could work a
radical change.
"And any such economic con-
vulsion could unleash forces OF
social tension, domestic friction
and pure political adventure.
something which might leave us
for a time without the essence of
free government" the council said.
Two Members Sign.
With the council chairmanship
vacant because of the resignation
of DR.. Edwin G. Nourse, the report
was signed by two members-Act-
ing Chairman Leon Keyserling and
John D. Clark.
The report, which deals at length
with Government-business rela-
tions, is distinct from the report
the President will send to Con-
gress next week, sketching the
needs of the American economy
for reaching maximum employ
ment and production.
In citing the need for more
stability" in Government policies
affecting the Nations well-being,
the council stressed the impor-
ltance of this factor in fixing tax
rates.
The group expressed no opinion
whether taxes should be higher or
lower, but hinted some change
may be advisable. President Tru-
man is due to make recommen-
dations in this field next week.
Great Shifts Cited.
"While we should aim in the
long run for reasonable stability
in tax policy the council said,
"the great changes in the tax
structure over the most recent
years and the double reversal of
economic trends in 1949, may
make it necessary to alter the tax
structure somewhat before basis
of stability in future years will
have been laid"
In adding that the whole eco
nomic policy should have more
stability. the. council said:
"The prudent American family
makes some arrangements lasting
20 or 80 years: q moderately large
business may look so years ahead.
and a local government some
times looks a century ahead. The
biggest venture of all. our Federal
Government, should strive gradu-
ally to modify its habitual prac-
tice of carrying almost all of its
major policies and programs on
a year or year-and-a-half basis.
The credit and spending and reg
ulatory and tax politics of the
Government are so highly condi-
tioning to the whole economy that
the degree Of stability of these
policies affects the degree of
stability throughout the whole
business world"
Amity Sought.
The report also emphasized that
business and government are
not enemies but friends" and
added: I'm the struggle to pre-
serve freedom, the businessman
needs government and the gov
ernment needs the help of busi-
nessmen in the development of
practical programs. These are
no times for pickering or pre-
judice."
Prime needs for the Nation as
seen by the council include:
/. Lifting of low-income fam
lilies to q "far nigner standard
of living"
2. more efforts" toward solving
the problems of small business.
3. Government encouragement
to steady business expansion to-
ward President Truman's goal OF
e "S eOe>OO