Evening star., 1951-06-24

ting the Defense Production Act
into effective operation In the first
place.
"The committee is convinced
that the real inflationary danger
lis ahead, not behind" the report
said. Although opinions differed
on the need for direct controls,
there was no disagreement on the
necessity for bulwarking our &C.
onomic defenses against q surge
Iof inflationary pressures."
No Profit Controls.
The report took issue with fears
that the economic controls pro-
gram would lead to system OF
profit control.
"The committee wishes to en-
Iphasize as emphatically as it
knows how that this act author
ICES no such program. The De-
fense Production Act as its very
name implies is designed to in
crease production. II. Congress
sees fit to control profits 1t will
do so through tax legislation"
The report called for constant
vigilance" to prevent undue con-
centration of industry" and to
safeguard the legitimate interests
of small business. 1t added that
the committee does not consider
that enough is being done or that
many officials in the agencies.are
aware of the importance Of CIV
ing full and fair consideration to
small business.
Effort to Break Vicious Circle.
AS for limitation, Of price roll
backs, the majority report ex-
planned that the provision would
not cancel rollbacks already in
effect. The provision, it noted.
permits rollbacks which do not
reduce prices below the last jan
uary-February level.
ANY method or any base which
may be chosen will result in a
certain amount of arbitrariness
and relative inequity." the report
said, Industry will possess the
certain knowledge that it will not
suffer any further rollbacks be-
yond aJnuary 25-February "a and
since there will be considerably
less wasted effort and irritation,
production will be that much
greater.
This will once and for all stop
any further price increase based
on other price increases that
were in turn based on some other
price increase. The vicious circle
of price increases must be broken
sometime by someone
Lists General Principles.
The advisory boards report,
submitted to the President by
Mobilization Director Charles +.
Wilson, noted that one member,
CIO President Philip Murray. be-
lieved the report "does not go far
enough in making specific recon-
mendations with reference to the
implementation OF the mobiliza-
tion program"
The board described direct con-
trolls of wages and prices as lat
best supplementary methods for
helping to prevent the initiation
ary gap from becoming larger
until it can be closed by the more
fundamental remedies which re-
duce excess purchasing power and
increase production"
1t listed these general princi-
plies" to be kept in mind as long
as such controls remain in use:
"The price and wage controls
are not substitute for a sound
tax policy to put the defense ef-
fort on a pay-as-you-go basis, or
a substitute for the other indirect
measures which involve less in
reference with the myraid details
of economic activity.
Second. these operating price
and wage controls need wide
spread cooperation based upon
full understanding and general
support. The main requirement
for this public understanding and
support is price and wage poll
icy which exhibits firmness and
relative simplicity"
hTere was no assurance that
the Senate and House will COM