Evening star., 1951-04-09
By creston B. Mullins

u gradually are coming to grips with
the most perplexing problem involved in
their rearmament against Soviet ag-
greSSion.
The problem is raw materials-how to
let all Of the arms-producing nations
share in them in an orderly fashion. in
spite of the lack of full wartime controls.
The job includes preventing imitation
and still providing minimum Of peace
time civilian production.
That's big order. chiefly because
since we still are formally in q state Of
peace, we do not have either the In
ternaI or external means Of control
which are possible in wartime.
IF truly peaceful conditions prevailed
the supply of practically all materials
tin. copper. rubber, wool, manganese, etc
would be adequate for civilian needs
But now that war preparation creates
new demand, the pressure on the sup
ply has become Overwhelming. Markets
still uncontrolled have gone wild, Great
ing an inf1ationary stimulus to the al
ready inflated domestic economies Of all
countries.
The United States, spearheading the
money and weapons for major portion
of the defense efforts Of the Atlantic
Pact nations, has been forced to gather
in from all corners Of the world the stra-
tegic materials necessary for the arms,
equipment and clothing which millions
of men Of all the Atlantic nations will
need as Western defense preparations
progress.
These materials have been acquired in
some cases at fantastic prices. As eyi-
dence. consider the rise in the price Of
tin from 78 cents pound in June, 1850,
to $1.83 at the end of January-and the
increase in the price of rubber from 80
cents pound in May to 70 cents in
January
The price of tin recently has dropped
somewhat with the American Govern
ment baking at being MIXED by pro-
ducers who, through fear of price sta
bilization, have refused to expand pro-
duction to meet the new defense de-
mandS. ,.
But our Government has found itself
in the strange position of bidding for
wool in Australia against its Allies. much
OF whose defense money comes from us
We have, in sense, been bidding against
ourselves.
France also has found itself caught in
squeeze-one which threatens not only
to cripple its rearmament effort but to
create fresh political chaos on which
communism feeds. France is producing
substantial quantities of arms for the
common effort. She imports large guam
titles OF foreign materials which 20 into
them. To get these materials, she has
had to bid against the other Western ma
tions. This process in turn has forced
up the domestic price of French civilian
goods. The result has been q demand
for pay increases. with all the danger of
strikes and economic dislocation implied
in that demand
Everywhere the story has been the
same: Rising prices in world raw mate
rial markets. skyrocketing prices at
home. rising demands for more pay,
more and more government spending,
heavier and heavier taxes. and lowering
standards OF living in every country.
The problem exists on two fronts
the domestic front in each country par
ticipating in the Atlantic defense pro-
gram. and the international front, where
the participating countries come into
contact as buyer and seller.
The attack on imitation, which saps
the life out of the rearmament effort. is
being carried out on the domestic front
by various kinds of price and wage con-
trolls. There is, of course, wide criticism
that the controls, not only In this coun-
try but in others as well, have not been
drastic enough. to meet the situation.
While there has been a certain effort
toward control on the domestic front.
there has been virtually none on the In
ternational front. The chief reason for
this is in the inability Of the govern
ments to harness themselves to stabili-
zation program during "peacetime." In
war; it is different. Then, since the chief
Western Allies control the seas and all
seaborne trade. it is absolutely necessary
for the raw-material- l-producing nations
to meet our demands for price stabiliza-
tion, under the threat of being cut off
entirely from world trade.
During World War II absolute con-
trolls over world trade existed. The raw
material producing nations accepted
price stabilization. They complained.
AoWSFSAs kAAets bA1Gy Wei 41Ub dU1C 10 guy
manufactured goods in return. The
present debate over tight regulation Of
raw materials prices revolves around
this complaint and the. need for expan-
sion Of production These producing
nations want long-term guarantees Of
markets. in exchange for price control
and expansion Of their production facil-
tiles. They also want guaranteed reason
able prices for the manufactured goods
they have to buy.
The closest approach yet made to end
ing the chaos in international markets
has been in the creation of commodity
committees under the International Ma
terials Conference. which has a central
group with permanent status in Wash
ington. This central group is composed
of the United States, Britain, France.
Australia. Canada. India. Brazil and
Italy.
Edwin T. Gibson. defense production