Evening star., 1950-06-19
1ruman's S Abrupt Veto
on Basing-Point Bill
Aids Local Monopoly
Distribution Practices
Upset by Reoetionory
Advisers to President
By David Laurence

By David Lascrence
President Truman's veto of tn
so-called "basing point" bill is
typical example of how Govern
ment is run nowadays.
For more than a year now, .
bill which was passed by both tn
House and the Senate has beel
the subject of a prolonged attacl
by a small group who have hell
up action on the Conferenc
Committee report. Finally, tw'
weeks ago. it went to the Whit
House.
The measure itself had the en-
dorsement of the Attorney Gen
eral and the Secretary of Com
merce and the two leading Dem
ocratic antitrust legislators IL
the House and the Senate-Repre
sentative Celler of New York ant
Senator O'Mahoney of Wyoming
both of them chairmen of i'm
portant committees dealing will
monopoly in business.
Not a word had come from tn,
Administration that it disliked tn,
measure. Then, just as the bill
would have become law in The
absence Of any action by tht
President, a veto message wa!
sent. There are not enough votes
to enact the bill over the veto
1t is a safe assumption that the
President never wrote the veto
message, and it may be doubted
whether he understands the COM
plex economic controversy that
has developed about the legis-
lation.
Authors Not Revealed.
Somehow a veto message was
written for him backed by pres
sure groups and advisers whose
identity isn't revealed to the
public. The result is that a con-
fusing Supreme Court decision
seeking to correct antiquities, is
now the law of the land. It upset
the distribution practices of the
past by concurring with a Fed
eral Trade Commission attack or
methods of pricing which include
freight costs. The effort of Con-
gress to clarity this point has
failed because a politically-mindec
President accepts the recon-
mendations of a reactionary clique
The proponents of the veto are
claiming that monopoly has beer
defeated. Quite the reverse is the
truth. Local monopolies have beer
encouraged and the total price tt
the consumer will rise.
The Presidents veto message
represents a milestone in the eco
nomic life of America. It fixes the
theory of the protective tariff ano
the theory of monopoly price as
permanent part Of the Democratic
Party platform and makes mock
cry of the idea that the leadership
of the party is today liberal" 1t
has turned the clock back to the
reactionary days of the 1920s and
has encouraged monopoly and
price gouging instead OF COM
petition from which the consumer
would benefit.
Some of the Democrats and Re
publicans who voted for the bill
did so on the mistaken expecta-
ton that branch plants would be
built in their areas and that the
large companies would be forced
to do this in order to retain the
volume of business previously en-
joyed. Since they could not ship
into these areas and set their
price to cover the freight, it has
been argued that they would have
to establish a string OF plants.
This made local politicians look
eagerly for new industries. The
opposite will happen.
Can't Afford New Plants.
The larger companies cannot
afford at present-day costs to
build branch mills or plants, so
they will leave the local areas to
the local monopolies. Likewise,
the latter will not give the con-
sumer the benefit of nearness to
mill. They will set their prices
as close to the freight barrier as
they can. It's the vice of the old
protective tariff over again.
Some of the Democrats are
saying that perhaps the Presi.
dents message will put a restrain.
ing hand on the Federal Trade
Commission and that the lattel
will not prosecute those firms
which attempt to compete by alb.
sorbing a part of the freight rate
This merely emphasizes the trent
in the administration, which Is tt
grab more and more power ane
decide each case as 1t suits th'
politics of the region. The law
yers who lobby before Govern
ment agencies will have more anc
more cases. The business men o.
America will not know from ont
day to another just what the!
can or cannot do about absorbing
freight rates.
All this will add to the infla
tionary spiral and make remote
an American distribution system
at lower prices-the most neces
sary factor if the purchasin!
power of the dollar is to be in
creased and real wages are to b.
raised. It's certainly an odd thin
to find so-called liberal" ad
ministration lining up on the reac
tionary side of American economi
policy-to protect monopoly ant
penalize the consumer.
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