Evening star. [volume] (Washington, D.C.) 1854-1972, 1962-07-26

PuUllC NOlko JILL OCS4SlACQ " Z
unemployment.
Both sessions were scheduled
in the context of growing fears
that the economy is heading
into a recession. These fears
have built up pressure for tax
cuts and increased Fedora
spending to stimulate the
economy.
President Kennedy has
planned to propose tax reduc-
tons effective next January l.,
but the economy's sluggish per-
formance has led him to con-
slider an emergency tax cut this
year.
Depends on Committee
His decision on timing prob
ably will depend largely on
prospects for pushing tax cuts
through the Ways and Means
Committee without a big fight.
Committee Chairman Mills,
Democrat of Arkansas. has not
committed himself, but it is
understood that he is dubious.
Most other members of the
tax-writing committee also are
skeptical about the urgency of
tax cuts. They approved Mr..
Mills plan for the hearings to
help the decide whether the
economy really faces the threat
of a recession, and whether tax
cuts would help substantially
to avert a slump.
Tax cuts will have a rea-
sonable chance for enactment
this year only If the committee
is persuaded that the answer
to both questions is yes" The
President probably would not
even propose 1862 tax cuts if
the Ways and Means Commit
tee we're hostile to the idea.
Experts Favor Action
The panel Of four experts
testifying in today's closed ses-
sion is weighted in favor Of
quick tax cuts, judging by their
past statements.
One witness was Ladd Plumb
ley, president of the United
States Chamber Of Commerce
tors last month proposed i'm
mediate tax cuts - estimated
billion-for individual and cor
The chambers board Of direc-
variously at SIS billion to $40
poration income.
Mr.. Plumley has defended the
proposal against charges that
it would be fiscally irrespon-
sible to increase budget deficits
with tax reductions.
Another witness scheduled
for today is Frazar B. Wilde,
who was chairman Of the In
fluential Commission on Money
and Credit. The CMC issued
a report last year calling fol
quick tax cuts whenever the
economy appears to be head
ing into a slump.
The CMC recommended re-
duction of tax rates in the
bottom bracket of individual
income when recessions threat
en-. 1t specifically opposed eff
forts to stop a slump through
reductions in higher income
brackets or for corporations.
BY contrast, the Chamber Of
Commerce proposed reduction
of corporation rates from So
per cent to Al per cent, and
larger tax cuts for middle-in-
come and high-income indi-
viduals than for the bottom
bracket.
Undecided on Recession
Also scheduled to testify to-
day was DR.. Gerhard Colin
chief economist of the Ma
tional Planning Association. DR.
COIN is not sure that a recess
sion will hit the economy soon
but he is disturbed because the
recovery from the 1960-61 SLUMP
has slowed so soon.
Whether or not a recession
occurs soon, DR.. Colin favori
1862 tax cuts and a broa(
range of other Government &C
tons to stimulate the economy
The fourth scheduled witnes
is Henry Alexander, boart
chairman Of the Influential
Morgan Guaranty Trust Co
New York.
In its July survey of tn
economy, Morgan Guarant,
said business has little luster
and shows signs of fatigue.
While there is insufficient
evidence to support a predic
ton that recession is com
ing, the survey said, "negativ
psychology seems to charac
terize the general mood, and
peaking-out of business befor