INFLATION: Ceiling for Everything

The Administration was visibly getting up its courage last week for its most drastic wartime step to date. As the nation moved toward employment of everybody and shortages of everything, the time came close when a huge universal ceiling would have to be clamped over the zooming cost of living.

When the Office of Price Administration puts up the ceiling laths and covers them with plaster, something will follow that has never before happened in U.S. history. All upward price movements, retail and wholesale, will halt. Price tags on the nation’s shelves, of pillow slips and Paris green, of cosmetics and traveling cranes, will read no higher fort the duration.

Under Congress’ present price law, OPA cannot extend its ceiling over wages, most current farm prices or rents except in defense areas. But once all nonagricultural prices are roofed over, adding porch roofs will be easier. Then labor will lose a huge lever to pry up raises; desk farmers will lose a big excuse for boosting wheat and corn prices; landlords will have a hard time justifying higher rents.

President Roosevelt has already hinted that he is considering a ceiling on everything (TIME, March 23). Congress willing,* the ceiling will go on.

Without rationing of shortage items, no over-all price ceiling can help springing leaks; soon there will have to be rationing of dozens of scarce products, and the economic complications will be manifold.

Four months ago Canada adopted the over-all ceiling plan—devised by Elder Statesman Bernard M. Baruch out of his World War I experience—after piecemeal stopgaps had failed. Now the U.S. was in the same fix. Price Boss Leon Henderson, who had tried to control prices by tackling them one at a time, was like a man with a rotted garden hose; as soon as he repaired one leak, a new one popped.

Determined to avoid retail ceilings because of enforcement problems, Henderson had to proclaim the first one when Pearl Harbor started a buyer’s panic for flashlights. Since then curtailment of civilian goods has forced more & more ceilings: on autos, tires, refrigerators, radios, 44 household electrical appliances banned by the War Production Board last week.

Now Henderson, who has long been frightened of a universal ceiling, is not quite so worried. On a trip to Canada last October, he found that a nation’s price-sensitive housewives make as good a staff of investigators as a price boss could ask for.

* The people are already willing. A Gallup poll showed 66% in favor of an over-all ceiling, only 24% opposed. Farmers disowned the greedy Congressional farm bloc by approving 64%; labor disowned its Congressional friends by voting 63%.