JULY 14, 1951
NEW YORK, Friday—In a vote in Congress the other day the Administration fortunately defeated a proposal made by Representative Jesse P. Wolcott, Republican of Michigan. This resolution said it was "the intention of Congress" to use direct controls only to the extent necessary to implement and supplement the anti-inflation powers of the Secretary of the Treasury and the Federal Reserve Board.
The House also turned down an amendment, which had been approved by the Banking Committee, to bar imports of goods made from raw materials under priority allocation in this country. The Administration feared, of course, that this would divert to other markets, including Communist-controlled nations, many scarce foreign-made products needed by this nation.
Those who wanted to pass this amendment said it would protect small industries, such as watchmaking, from unfair foreign competition. It is true, of course, that Swiss people seem to be exceptionally good at making watches, but we have managed to find ways of using their skills and still make profits even in small businesses.
The idea that little Switzerland and its watchmakers can really harm small business in the United States by unfair competition seems to me rather ludicrous. We survive and prosper because we know how to use to the best advantage what comes to us from other nations. Our workers have the best standard of living in the world, and our efforts should be to stimulate the other nations in the world to get better profits through better management and then to stimulate their workers to get a better share of those profits. In this way standards of living will go up in the other nations and we will have better markets for our goods.
Many things are made here that are neither as good nor as cheap as those made in other nations and I do not think we really need to worry about needing protection from Congress.
We do, however, need to impress Congress with the fact that the people of this country understand that inflation is dangerous and that we want every method used to stop inflation. Congress needs to recognize the fact that we understand their problems and are willing to submit ourselves to certain restrictions in order to keep our economic machinery sound.
We must continue to prevent the granting of credit on too wide a scale. That will make people save so that they will be able to make larger down payments.
We also should be saving now and putting our money in government bonds or savings accounts so that it will be there to use when production returns to a civilian basis and today's scarce goods become plentiful again.
We must also make Congress realize that we want price controls. If prices are not controlled, our dollars buy less and less, and we will not be saving for a future day if the extra money we earn is worth no more than what we had before.
If we do these things—insist on restriction of credit, on saving by all, and on price stabilization—we shall be grateful to Congress in the future and we will remain on a sound economic basis.