PLANNED ECONOMY ADVOCATED AS DEPRESSION CURE

Evening Star, Issue 26138, 27 June 1947, Page 5

PLANNED ECONOMY ADVOCATED AS DEPRESSION CURE

(ißeo. 9.30 a.m.) WASHINGTON, June 25. The real income of most people could be doubled within 25 years and the age-old dream of abolishing poverty could be realised if wise action were taken to operate the national economy more effectively, declared Mr Paul Hoffman, chairman of the National Committee for Economic Development, which has been considering ways and means . of preventing depressions. Mr Hoffman’s statement, published today, was prepared for the Joint Congressional Committee on the economic situation. Mr Hoffman recommended the encouragement of free competition and the removal of barriers against risktaking in the tax structure. He urged full support for the State Department’s battle to reduce international tariff barriers. He said that full assistance should be given to world reconstruction and world rehabilitation, otherwise the world would fall to pieces and Russia would pick up the nieces. He recommended a substantial tax reduction in the near future, with further cuts later, progressively as a stable price level developed. He urjjed more stable credit policies under which loans would not be called in during depressions if they were still good risks. He also recommended Government development of a long-term agricultural policy and promotion ol industrial peace. He said that business should be encouraged to operate profitably and efficiently, avoiding unnecessary expansion of inventories, but markets should ‘be expanded by forgoing additional immediate profits, and there should be restraint on everyone’s part in raising prices, wages, and salaries in recognition of the common interests. Mr Hoffman said the keystone, of the goal in avoiding severe depressions was the maintenance of dynamic stability, which would utterly reject the nhtion that, violent booms or “ busts ” were inevitable. DOLLAR CRISIS IS PREDICTED BEFORE END OF 1947 (Ree 10 a.m.) WASHINGTON, June 25. A dollar crisis will occur before the end of 1947, according to a Department. of Commerce forecast today, because foreign countries have been using up their dollar exchange sn rapidly. Hitherto, official and expert predictions have been that an acute shortage of money needed to purchase American food and supplies would not develop until some time in 1948. The department warned American exporters that a dollar shortage would inevitably 'mean a decrease in their business. It was explained that in terms of dollar exports the first half of this year was equalled only by the flood of goods America sent to'Europe and the Pacific immediately after tne Normandy invasion in 1944, but prices now were at least 30 per cent, higher, and therefore the actual flow of goods was considerably less.. The department pointed out that if the dollar problem and price situation remained uncorreeted, foreign countries could save themselves only by relying increasingly on exchange controls or barter, or by restrictive import measures.