Evening star., 1951-05-17
Mr.. Johnston on Initiation

In his series OF statements and talks around
town the other day, Eric Johnston, chief of the
Economic Sterilization Agency, had a lot
of blunt but timely things to say about the
need for a "get-tough" policy in dealing with the
problem of imitation. Despite the fact that many
prices have tended to level off in recent weeks,
the danger is still very much with u.s. and unless
it is dealt with vigorously and without delay,
along the lines suggested by Mr.. Johnston it is
going to cause the Nation great deal of grief.
AS outlined by Mr.. Johnston, there are at
least six major factors that make the inflation-
ary threat very real and pressing They are:
Cd The impending great increase in defense
spending, which will inject an additional 81
billion weekly into the Nations economy during
the months Immediately ahead; (2) demands for
"milk-it-dry" profits and wages; 90 rising food
prices; "a the danger of scare" buying and
boarding when consumer shortages begin to
appear as rearmament goes into high gear; 80
the possibility of serious new labor management
troubles; and (6) widespread failure to recognize
that this is a period of genuine emergency in
which emergency action must be taken on all
economic fronts to keep the dollar as sound as
possible.
The problem, of course, has to do with much
more than the individual pocketbook. It has
to do with the security of the entire Nation, the
simple fact being that initiation, If not firmly
checked, can gravely affect our defense effort
Thus, when prices soar-as after the outbreak
of aggression in Korea-planes, tanks guns, ETC..
cost more, and the more they cost, the less of
them we can get with our money. In short as
If by enemy action, they are knocked out by
the economics of the stuation-a fact that un-
derscores the common sense of these words by
Mr.. Johnston: "Just as mobilization is our best
insurance against war, so a sound dollar in
stabilized American economy, is the best insur-
ance we could have that our mobilization pro-
gram will succeed"
To get that insurance, Mr.. Johnston has
emphatically urged that the Defense Production
Act, which is scheduled to expire June 80, be ex-
tended with strengthening amendments At the
same time, he has made clear that he believes
1t to be imperative to do the following, among
other things: ID To crack down on spiraling
industrial profits; (2) to hold the line unyield-
ingly against above ceiling wage demands; 90
to keep rents from soaring; (4 to flatten down
food costs; (5) to enact heavy "pay-as-we-go"
taxation and strict credit controls in order to
siphon off excess purchasing power and discour-
age competitive bidding by businesses and indi-
vduals for diminishing supply of consumer
goods; and (6) to economize in way that will
eliminate non-esSential governmental spending
This "get-tough" policy considering the
times, it's not really so tough) obviously will not
win Mr.. Johnston any popularity awards in GER
tain circles. But he is not looking for such
awards. His only objective is to keep the United
States economically as strong and as steady as
1t must be If it is to cope effectively, and tri-
umphantly, with the deadly external threats
now confronting it. The program he advocates
to that end may not be perfect down to the last
detail but the substance of it is sound, and
something very much like it is undeniably needed
The American people should support him
accordingly.