THE GOVERNMENT: Sabre-Rattling

Now & then it is Franklin Roosevelt’s pleasure in his press conferences to play Professor of Economics. In this role in April 1937, he lectured that certain commodity prices were too high, thereby precipitated a world-wide break in commodity prices, the first signal of Depression II. Last February Professor Roosevelt again delivered himself on commodities, this time documenting his remark with a dozen charts which he didactically explained with a long wooden pointer. Last week “a White House Spokesman” (see p. 13) had some thoughts to express not only on commodities but on the entire economic condition of the U. S. FromHyde Park the “spokesman” delivered himself to the following effect:

It is the general feeling of the Administration that the recent European crises have a definite U. S. analogy: that the parallel of sabre-rattling and mobilizing in Europe (artificial creation of a crisis) is to be found in the U. S. in extravagant misrepresentations of Government policies, in bogies set up before the eyes of industry and business. Among such bogies: that the Government plans little TVAs all over the U. S., that private utilities cannot raise money publicly for expansion, that the Federal tax burden is far higher than two, three or five years ago (see p. 13).

The lesson, continued the “spokesman,” is the same as in Europe: if people stopped calling names and rattling industrial swords, the result would be peace instead of war between Government and industry, between industry and labor.

As for the more concrete side of the current business picture, it appeared to the “spokesman” that the nation’s shelves of merchandise were far more empty than a year ago, that the consumer demand of the public had declined far less than might have been supposed from reading the tearing-down stories in the press, that the full effect of pump-priming was still to be felt, that employment was gaining more than seasonally. The “spokesman” warned that the Administration will continue to prevent prices from going through the roof.

This long discourse drew several replies from Business. The Business Advisory Council of the Department of Commerce expressed hearty accord. President Charles R. Hook of the National Association of Manufacturers declared: “There is to be no rattling of any industrial sabre so far as the nation’s manufacturers are concerned. . . . Political leaders can help along similar lines. . . .” From diehards came no such gentle reproof. Instead, many a businessman pushed the “spokesman’s” European analogy further, suggested that if Government and Industry sat down to peaceful conference, Business could expect Czechoslovakia’s fate.