Evening star., 1961-01-18
THE KENNEDY CABINET
Dillon Looks to the Middle Road

countries-as much for moral
as for political and military
reasons.
Foreign aid never has been
overwhelmingly popular with
Congress, but Mr.. Dillon is held
in high esteem on Capitol Hill.
"They like him because he's
sincere, to the point, and
knows what he's talking
about" an admirer comments.
Sees Link Between Jobs
Although Mr.. Dillon faces
new problems at Treasury. he
foresees continuity between his
old and new jobs. To him. for
eign affairs are a blend of
politics and economics - with
economics rapidly growing in
Importance. He believes eco
nomic strength is fundamental
to the Vests defense against
communism.
The deficit in the United
States balance of payments.
with the consequent loss of
gold from Government stocks,
is one of the immediate chal-
lenges awaiting Mr.. Dillon. He
indorses remedial actions taken
so far by the Eisenhower ad-
ministration, and has some new
ideas to try during the next
few months. Without mini
mizing the seriousness of the
payments deficit, he is conf
dent of achieving near-balance
within two years.
Mr.. Dillon recognizes that
his viewpoint will have to
change when he shifts from
State to Treasury. Those de-
lpartments traditionally clash
over methods and objectives,
but Mr.. Dillon thinks his back
ground in foreign affairs will
help promote cooperation.
THE Treasury bureaucracy
will have a hard time captur-
ing him." a State Department
associate predicts.
On what is perhaps the key
Question Of domestic economic
policy, economic growth, Mr..
Dillon has a viewpoint that is
entirely acceptable to Demo-
crats-at least in broad outline.
He urges a faster rate of
growth than the United States
has registered in recent years,
and maintains this can be
achieved without initiation and
within the bounds Of financial
integrity.
Favors incentives
He processes to see little dif-
ference between the Demo-
cratic and Republican plat
forms on the growth issue.
Mr.. Dillon has not publicly
discussed his ideas on growth
in any detail. but he has indi-
Gated he favors tax incentives
for investors as a major device
to stimulate business activity.
He also has called for TAX re-
FORM" involving action to close
tax 'loopholes" and to reduce
tax rates-especially in high
income brackets.
He has avoided taking a
stand on big increases in Fed
eral spending to stimulate the
economy, but he has said it is
not harmful to run budget defi-
cits in periods Of economic re.
cession. Budgets should be bal
anced over the business cycle
he asserts.
On the question Of interest
rates and tight money" Mr..
Dillon's position is a mystery.
One informed source predicts
Mr.. Dillon's relationship with
the conservative Federal Re-
serve Board will be stand
offish." But another qualified
observer sees him as an ally of
William McChesney Martin, jr.,
chairman Of the Federal Re-
serve.
When the Kennedy admins
tration gets down to arguing
about New Dealish programs, q
member Of the President
elects team forecasts. Dillon
probably will want to go slow
but not very, very slow"
Mr.. Dillon. confident of his
persuasive powers. asks only
for an opportunity to express
his views in Democratic coun-
ellis. He does not expect to be
a minority of one.