Evening star. [volume] (Washington, D.C.) 1854-1972, 1963-10-24
u. ). in Period
Of Economic
Pump-Priming
BY LYLE DENNISTON
Star Business Writer

Int SONCA AAAAASllb Will UC uOlIlE
some economic pump printing
for the rest of this year, even
though both the President and
Congress now frown on extra
spending.
After doing less than usual to
help the economy expand in the
late summer and early fall, the
Government will be a consider
ably better economic partner
in the last three months of the
year.
Spending and tax data now
being studied by Federal econo-
mists show that, between now
and New Years Day, the Gov.
eminent will be putting back
into the economy considerably
more than it takes out.
And that will be true even
though Congress, by taking
weeks longer than it usually
does to approve agency spend
ing plans, and President Ken
nedy, by ordering agencies to
save where they can, have done
quite a lot to keep new outlays
in check.
Since the Kennedy Admins
tration came into office almost
three years ago. the Govern
ment has been regularly adding
to the upward pull on the econ
omy. That, at least, is true by
a measure that White House
economists think is the most
sensitive indication Of the eco
nomic impact Of the Govern
ment's budget.
Ease-Up in Excess Outlay
BY this measure, Uncle Sam
paid out S4.5 billion more than
he collected in Mr.. Kennedy's
first year as President. and S4.3
billion more in his second year.
But this year, that excess of
outgo over income has shown q
steady decline.
If the Government had kept
all year to the pace it set in
January. February and March,
the pump printing effect would
have been as strong as in 1861.
But, in the second quarter.
spending increases slackened at
the same time that tax collec-
tons were picking up. The re-
suit: Uncle Sam was down to
an annual rate of SO billion in
NEUTRALITY-SUSPICIOUS..
Then, in July, August. and
September, the same thing
happened again-just a little
extra spending, but a lot more
taxing. For that quarter, the
Government only put back
about SIS billion more-at
annual rates-than it took out
of the economy. Federal econo-
mists now calculate.
Now. it appears, the Govern
ment is going to turn the trend
for this year around. In the
three months up to December
81, economists guess, it will
add SO billion or more extra, at
annual rates, to the economy.
And, Interestingly, it will be
people who work for the Gov
eminent who will be largely
responsible for this pump
printing effect of the budget.
Military men will be getting a
pay raise, and civilian workers
will be getting another install
ment in their salary increase.
This will account for much of
the extra Federal money that's
going into the marketplace.
TwO-Year Trend
These changes in the stimu-
lating effect of the budget are
particularly significant, econo-
mists now in Government feel,
because more of the Federal
dollar goes for the things that
make sales for business, and
less goes into handouts or sub
sides to those getting Govern
ment aid or relief checks.
This trend of buying more
goods and services and paying
comparatively less in aid has
been going on for most Of the
last two years. That's partly
due to the fact that times are
better, and so not so much of
the Federal budget has to go to
bail out the needy. And it's
partly due to the fact that this
administration is more willing
to take on new spending prof.
ects.