Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-02-27
Economic Committee
Says Flexible Props
May Be Dangerous
BY james Y. Newton

by james ]. newton
An important congressional
committee was on record today
in opposition to President Eli
Senhower'S flexible" farm sup
port program at this time and
in favor of a more far-reaching
program for dealing with the
economic downturn than the
President has recommended so
far.
The Senate House Economic
Committee, in an 111-page eco
nomic report. also established a
special subcommittee to follow
developments closely and to see
whether more tax relief is
needed ION a day-to-day basis"
The committee, headed by
Representative Wolcott, Repub-
lican. of Michigan recently con-
cluded three weeks of hearings
on the general economic Situa-
ton and on Gen. EiSenhower'S
economic report to Congress. It's
report will serve as a guide to
the various legislative commit
tees in working out measures to
combat the business downturn.
AS for the Presidents pro-
grain for flexible" farm price
supports. as opposed to the pres
ent rigid" standards, the COM
mittee said the proposal may
actually place the farm family
in a worse position in the short
run.
Called Questionable.
Whatever the merits of flex-
ible supports and modern parity
may or may not be as a long run |
program, it is questionable |
whether their contribution at |
this time will act to sustain farm |
income in the months immedi- |
ately ahead when the threat to
our economic stability is so gen.
orally recognized"
Without saying so in so many |
words. the committee also ex-
pressed the belief that the econ I!
omy- bolstering measures sug-
gested by the President may be |
inadequate to fill the gap and !
maintain the high purchasing
power and employment neces-
sary to economic health.
The report also stated. in eff |
feet. that, while curtailment of /
expenditures and a balanced .
budget are highly desirable OBJ /
jectives,' economic stability is of !
more Importance at this time.
While not recommending more
spending for defense than the
administration plans. the report
said 1.-The economy is capable of
meeting safely additional mill
tary expenditures if such ex-
penditures are necessary for our
military security"
LOng-Term Outlook Good.
All in all. the committee ex-
pressed confidence that ANY Sc
rious. further recession can be |
avoided" if consumer spending
and business investment are
stimulated by timely and cou-
rageous" actions. /
The long term outlook for the |
economy was held to be good. |
But there are elements of I'M
certainty in the current situa-
ton" which, the report said. !
cannot be ignored:
l. The extent of involuntary
unemployment" may be greater
than reflected in current Gov
eminent statistics. The report
said present statistics on that
subject are inadequate, and it
urged the appropriation Of funds
to make possible more accurate
surveys.
- AAAC PLCoCIlI CCOIlOIIllC U6-
cline may be more serious than
that which brought l:nemploy-
ment close to the 5-million mark
in 1949. /
3. Even though the present
situation may be no more than
a minor economic readjustment,
1t takes place at a time when the
Government is sharply curtail-
ing its spending.
The committee heartily in
dorsed the administrations re-
quest for an increase in the pres
ent $275 billion Federal debt
limit. Congress denied a similar
request last session and the debt
since has been knocking against
the ceiling.
The committee Endorsed much
of Gen. EiSenl1ower's economic
program, including proposals for