Milford chronicle., 1953-01-02
Good Business Seen
Until 1856
By Associated Press

Secretary Of Commerce Sawyer
and a team of government and pri-
vate economists predict good busi- +
ness in the new year, a possible I
downturn in 1854 and sharp &C.
onomic test in 1855.
The economy has strong built-in
safeguards against a depression in
the coming years, Sawyer said, ex- !
pressing the view that the chief
peril, as defense spending slacks
off, is fear and uncertainty, not
economic weakness.
"The situation is sound" Sawyer
said in a preface to the 80O0O-word
report on Markets After the De-
tense Expansion"
The report, made public this
week was prepared as a guide to
business conditions in the final
stages of the defense buildup and
after spending for military purpos-
es turns down. The crucial year
will be 1855, it said.
It predicted defense spending
will reach a peah Of IS TO go billion
dollars late in 1853, will run at
lpeak levels through 1854, and will
fall off in 1866 to so to 55 billions.
! Defense expenditures would then
60 on down toward more or less
4 permanent level somewhere be-
tween 20 and so billion dollars a
year, it said.
Meanwhile, it said, spendable in
come may go up per cent.
The report was written by the
Commerce Departments Office of
business economics after a six
month study in which other gov
ernment agencies and the Commit
tee for Economic Development CO.
operated
Ike Aides Participate
Marion Folsom, who is to be un-
1 dersecretary of the treasury under
: President-elect Els hover, is
/ chairman Of the CED. George M.
Humphrey, Secretary Of the Treas
: ury-Designate, is a CED member,
as are several other high Eisen-
hover aides.
$ The report said businessmen
: plan expenditures in 1853, 1854 and
: 1865 for new plant and equipment
T close to this years record level OF
S nearly q billion dollars.
: The report cited this-pius con-
. tinued population growth, untitled
y needs for schools, hospitals, and
+ highway building, modernizatiOn
q and replacement. possible tax re.
ductions, sizable individual savings
n and social security benefits - as
s major offsetting factors to slacken.
e ed defense spending and any tend
e ency toward recession.
e Depression Weapons
l. But the report came up with thu
d conclusion that bigger production
and purchasing power are the key!
e to locking out depression.
y The survey assumed information
D al conditions and U. S. militar,
d goals in the next three years woult
II not appreciably change.
is Because the economy is nov
IS more or less keeping pace witt
t. civilian and military requirements
2 the report said, there will be nei
ther a backlog o fdemand nor
n letdOwn in 1855.
,d In the present national securit
e. program, military spending is eX
" pected to reach a peak at abOU
n IS to II per cent of the gross ma
c. tional product and to drop to
s. maintenance level of about IL pc
I'D cent.
Salient Forecasts
en The report wound up with an ii
n dustry-by-industry survey of bus
IN ness prospects in 1855. Leading u
er to the survey, it made these prime
re pal points:
an 1, "The strong prObabilit,
ID. through of course no certainty,
re another year of good business
1858"
IL 2. "a downturn in 1854 is a rel
CIV possibility"
of 8. ''The projected decline in d
Dl- tense spending in 1866 would pr
We vide a serious test of the ecol
ne omy....Thus, 1855 appears to be
Ill year in which it will be of mai,
Importance sizeably to expand pr
73- vate markets."
W. 4. Business expansion and r
en- equipment will continue in 10
ity only about half a billion dolla
ier under this years record Of near
ort q billion dollars.
Ter Bigger Markets
ent 5. Historic productivity increas
A in U. S. industry and project
is population increases indicate
al potential total market (gross n
nts tional product) OF about 365 billi
dollars (at 1851 prices) in 19E
his compared with 337 billions Cal
lee measured in 1851 dOllars) in 19I
a." 6. Personal income after taxes
civ 1855 may be 24O billion dollars,
hy- increase of z per cent over 1851
her Z. No major price raises are
for licated in the near future.
obs 8. A timely year for tax CT
.ea. would be 1855, when both COVER
IDS ment and private spending may
and stacking off.
tor 8. Farm price supports wol
/" cushion any economic slip, helpi
to keep up farm purchasing pow
The industry-by-industry surN
nty showed:
.rry The auto industry producing
Iers per cent more than at presel
)Wli furniture industry, per c,
me more. radiO-TV 9rOductiOn. IN