Evening star., 1962-04-16

The extremely strong Ian
guage of the Presidents
statement on the recent steel
price increase is. in my opin-
ion, an unwarranted caStiga-
tion of the company man
agements involved. For one
who studies the economics
of the steel industry in a
factual manner it is plain
that an increase in profits
is necessary not only to con-
tinue a fair return to in
veStors but to. insure the
modernization of plant and
equipment which is so nee
essary to meet worldwide
and domestic competition.
The President himself has
apparently recognized this,
since he and his adminiStra-
ton have been so inSistent
on the investment incentive
tax credit which they ruth
leSsly pushed through a re-
luctant House. This wind
fall, which is unwanted by
labor and business alike,
would cost the United States
Treasury almost So billion
per year.
Just a few days ago the
UnderSecretary of the Treas
ury. speaking for the admin
istration, emphasized the
need to increase the rate of
profits Of American business
and industry.
If the President Is really
concerned about price in
creases let him pursue a
policy that would bring about
the mueh-needed tax reform.
This can be accomplished by
Governments taking less and
leaving more industry profits
with those who made them
so their plants can be mod
ernized and expanded and
more jobs created. And it is
well for the President and
others in Government to re-
member that of the profits
which any business or indus
try makes, the Government
takes the largest share-52
per cent.
After careful review and
study of the President
statement as well as his
answers to questions by re-
porters, I can only conclude
that he is reacting as many
common citizens might to a
situation which has caused
him to lose face. Even he
does not claim that the steel
industry promised anywhere
before or after their recent
contract settlement that
there would be no price in
crease. True, the public had
some right to expect differ
emily, and steel management
may well have been guilty in
allowing this opinion to form.
but I suspect that most of
this came about from the
desire of the administration
to make political hay from
what they so widely heralded
as a non-inflationary" steel
settlement.
The pressures on the Pres
ident are infinitely greater
than any lay citizen could
ever imagine, but this is a
fact that President Kennedy
knew long before he was
elected. His position does not
allow him to react to situa-
tions as an ordinary citizen,
and it is to be hoped that
future public statements on
national or international sit
uations will reflect more
sober prior thought than is
apparent in his statement on
the steel price increase.
Lyle r. Mercer.
Our petulant President is
showing his immaUurity
again.
Slow to anger at the likes
of Castro and Khrushchev,
Mr.. Kennedy has assumed
an air of towering rage
against those irresponsible"
ODD steel companies. One can
understand his annoyance.
Here Kennedy has the whole
country $40 billion in the
hole for one year and the
steel companies are out
blithely trying to balance
their books. It's unpatriotic.
The important thing is,
we've got to stop initiation.
Mr.. Kennedy doesn't like in
flation at all. If necessary,
he would spend $40 billion
dollars to fight it.
j. c. Davis.
y +
The ire of the President
about a threatened increase
in steel prices is understood
when one realizes that the
threat completely embar-
rassed him and his ad-
visers who had praised and
publicized the recent steel