Evening star., 1961-01-16
INTERPRETIVE REPORT


health Of the economy, pro-
posed no new programs to cut
the number Of jobless or spur
economic growth.
Administration officials
warned President-elect Ken
nedy to avoid spending pro-
posals that would upset the
fragile balance between Fed
eral receipts and spending.
Their advice flatly contra
dicted the suggestions which
Mr.. Kennedy has received from
his own economic advisers, who
see the need for specific anti
recession measures.
The stage was thus set for
an all-out battle between con-
servative and liberal blocs in
Congress over emergency un.
employment compensation and
other pump-priming bills the
new President Is likely to seek.
STAINS Cites Adjustment"
Outgoing Budget Director
Maurice H. Stans sounded the
old regimes theme when he
proclaimed that the economy
is through its period of lad
justment" and is ready to "re-
sums its upward growth"
"Thsre are no deliberate
anti-reCsssion features in our
budget" Mr.. Stans said, "be-
cause we do not assume we
are in that position"
"A few statements Of conf
dence by the new administra-
tion win do more than billions
Of dollars Of fast spending, i"
Mr.. STAINS declared.
His remark was aimed at the
recommendation advanced by q
Kennedy economic task force
last week that the Government
should boost spending 1856
billion next year to speed the
end Of what it called the
recession"
Expenditures could be in
creased 500 or 81 million and
maintain q sound fiscal policy" I"
Mr.. STAINS said, "but they could
not be increased 1856 billion"
Predict 1851 Upturn
Mr.. stans and Secretary of
Treasury Anderson both
stressed their belief that built.
in stabilizers" set in motion by
the downturn in business ac-
tivity in 1860 already have been
effective in stemming the de.
cline. They predicted an up
turn in the first or second
quarter Of 1861.
Rather than engage in pump
printing Federal spending. Mr..
STAINS said. the Kennedy ad-
ministration should set to re.
establish confidence in the
health Of the economy.
II don't want to be In the
position Of criticizing the
President-elect or his advisers,
Mr.. STAINS said. "but UP until
now, there has been more Of a
tendency to cry pessimism than
to assert optimism. I think Q
shift is due"
. The Eisenhower administra-
ton counts heavily on q re-
bounding economy in predict
ing balanced budgets for the
current fiscal year and the one
beginning July !.
Budget Receipts Up
Secretary Anderson said
budget receipts for fiscal 1861,
which ends June 80, are esti-
mated at $79 billion, UP $1.3
billion from the previous year.
In fiscal 1862, they are expect
ed to rise another $3.3 billion to
$82.3 billion.
These estimates are based on
an $l1 billion increase In per-
sonal income, to $415 billion in
calendar 1861, accompanied by
O 81 billion increase in corpo-
rate profits. from $45 to $46
billion.
The administration estimates
calendar 1961's gross national
product-the total value Of
goods and services-will be
close to $515 billion, compared
to an estimated $503 billion
in 1860.
These estimates jibe closely
with the more optimistic Of two
predictions on the economy
given to President-elect Ken
nedy last week by q group of
advisers headed by Dr.. Paul A.
Samuelson Of the Massachu-
sets Institute Of Technology.
Unemployment Situation
The crucial difference is this:
The Samuelson report argued
that even If the economy
reached the optimistic" level
in 1861, unemployment would
not shrink much below the
level Of 6 per cent.
So it recommended that the
Government boost planned
spending on foreign aid, de-
fense. education, urban re-
pewal, highways, resource
development and welfare meas
ures So to IS billion next year
in an effort to put more people
back to work.
Mr.. STAINS, the present
Budget Director, declined to
predict how many persons
would be .jobless in 1861, but he
pointed out the Eisenhower
proposals call for no emergency
unemployment funds similar
DO those the administration rec
commended in the 1858 recess
sion, when unemployment
topped 5 million.