Evening star., 1951-11-16
Johnston Sees
.Lu|I in Inf|ation;
Wi||QuitNov.3 80
Government Reports
Difficulty in Finding
New ESA Director


The country is entering a Pc
riod of relative calm" so far as
inf1ationary pressures are con-
cerned. that should last for two
or three months, Eric A. john
ston said today as he prepared to
step down as the Governments
economic Stabilizer.
Mr.. Johnston's resignation, ef-
fective November 80. from the
post he has held since last jan
uary, has been accepted with
real regret" and extreme re-
luctance" by President Truman in
Key West, Fla. Mr.. Johnston will
return as president of the Mo-
tion Picture Association.
The Government, meanwhile,
was hard put to find a successor
to Mr.. Johnston. He told a news
conference the job had been Of
fered a number of persons with
no takers so far. Among those
sought for the post, he said, was
Price Director Michael v. Disable,
who said he was not available.
Warns Against "PreSsures."
While predicting the country
would enjoy period of relative"
economic calm, Mr.. Johnston
warned that strong inflationary
pressures still exist and will be-
come an increasing threat to the
economy next year as the needs
of the huge defense program cut
deeper into civilian production.
He said the inf1ationary pres
sures are particularly great in
the fields of metals, paper, petro-
leum and other industries. II
price controls were dropped, Mr.,
Johnston added, sharp price in
creases would occur Immediately
IN those fields.
Mr.. Johnston said that early in
the fight to control imitation the
Government had placed to much,
emphasis on direct price and wageI
controls and too little on indirectt
controls such as credit restrictions.i
taxation and savings. I
Congress Action Deplored,
1t would be a national blunderl
Iof the first magnitude for us now
to put all of our reliance on directi
controls" he continued. He saidl
ne was alarmd by congressional
action in relaxing consumer credit
controls, adding I'VE will need all
OF the tools at our disposal" to,
control imitation and maintain a,
sound economy.
| But Mr.. Johnston said the Cow
ernment should look to the day
when 1t can drop direct price and
wage curbs, and that it could only
oe done through full use of in
direct economic controls.
Mr.. Johnston described as "ab-
Solutely incorrect" a report that
ne mad resigned because of differ
ences with President Truman over
a wage policy for the steel indus
Try. The C1O United Steelworkers
and the steel industry will start
negotiations for a new contract
IN two weeks and the union has
lnolcated it will demand more of
a pay increase than is permitted
under present wage control policy.
This office has had no differ
ence with Mr.. Truman over any
policy" Mr.. Johnston said. TT
mas been remarkable as far as
am concerned"
Lauds Truman, Wilson
Earlier he said he wished to
pay very high tribute to Presi-
Gent Truman and Mr.. Wilson de-
tense Mobilizer Charles E. WILSON,.
They have always been available
Tor consultation and support"
AS for the forthcoming wage de.
mands OF the steelWorkers, Mr..
Johnston said they are entering
a period of collective bargaining
with the steel industry and 1 do
not wish to prejudge the case"
Mr.. Johnston discussed the Cow
ernment's difficulty in getting top
quality men to serve in the de-
tense program.
"All business, labor and profess
slonal people should come to
Washington when asked" he said.
and employers should grant them
leaves of absence. 1t is Just as i'm
portant for a man to be drafted
from business as it is for our young
men to be drafted for military
service. These men should not put
personal Inconvenience ahead of
national service"
Small Report Denied.
After the Johnston RESIGNATION,
White House Press
Secretary Joseph Short scotched al
newspaper story speculating that
the job might go to John D. Small.
of the Munitions Board.
THE President needs Mr.. Small,
where he is" Mr.. Short told re-,
porters.
In Kansas City, Michael v. Di-
Sale. director of the Office Of
Price Sterilization, also discount
ed rumors that he might be in line
for the job.
Technically. the task of find
ing a man to head ESA is in the.
hands of Charles E. Wilson. di-
. W of the Office of Defense