Show I II i I L IORo FARMERS RS r r r ri rr Ceilings A s on Pay mf I Prices Gain Business Okeh V WASHINGTON ASHINGTON Jan 27 The lP-The The governments government's wage price-wage freeze Saturday set off protests from labor and farm groups kwon j won qualified acceptance from a number of businessmen and led to the temporary shutdown of several commodity markets J Trading in cotton on the New York New Orleans and Chicago Chicago Chicago Chi- Chi cago cago exchanges was suspended by officials who said they are ara uncertain about details of of the I freeze order Trading in cotton cottonseed cottonI cottonseed I seed and soybean oil futures likewise likewise like like- wise was halted at the New York produce exchange Prices on the New York stock exchange meanwhile went up One broker explained What more could you ask With prices frozen at their highest point that means means' means means' more profit for everyone I The freeze announced Friday I I night Inight ordered wages held to their their levels of last Thursday while the 1 l wage stabilization board works out a flexible formula Prices Prices- with the important exception of I I many food items were items were ord ordered red to togo togo togo go no higher than the top level of Dec 19 25 Freeze Just Temporary In most cases that means the prices that were charged Thurs Thurs- day The price freeze too is temporary temporary tem tem- pending the development of separate orders for the various kinds of goods Stabilization officials disclosed Saturday th that t they are already working to relax the wage freeze to some extent They said the first amendments may come Monday or more probably Tuesday It was indicated the first amendments amendments amendments amend amend- ments will concern recently negotiated negotiated negotiated contracts and arbitration awards arranged to become effective effective effective tive after the Jan 25 freeze date This problem was tagged for first consideration by the wage stabilization board because officials officials oHi- oHi said of the possibility of strikes or other labor unrest Such an amendment could take care of the recently negotiated pay boost in the coal industry Wage aso Hike Formula Another problem slated for carl early r consideration by the wage board is a formula to allow unions and employers to negotiate wage increases in increases in- in creases within a specified percentage percentage percentage per per- limit provided ha have ve not obtained a wage increase within a specified time There was wasI talk of permitting wage boosts of I up to 10 Placed near the end of the wage I boards board's priority list of policy decisions decisions deci deci- i was the problem of escalator escalator escalator escala tor clauses These provide for automatic pay increases according to rises in the government living cost index This problem is re regarded regarded regarded re- re as not so urgent because escalator adjustment periods See Page 2 i Column 2 Labor Farm Groups Rap Freeze on Prices Pay Ray Continued from Page On generally do not come up for a e month or two The automobile industry goner gener ally has such escalator clauses clause s in Its labor contracts Government officials issued th the c freeze as admittedly a stop gap P action against inflation and said sait d adjustments and clarifications wilbe vil wil 1 be along later Price stabilizer Michael V V. DiSalle indicated strongly in a statement of ot considerations considerations' Issued Saturday th that t one of hi his agency's big tasks now will be to determine the extent if any that prices of certain products or commodities commodities commodities com com- need to be reduced or rolled back out that the dire need of th the the moment is to stop the onrushing onrushing onrushing on on- rushing price advance in its tracks DiSalle said that the fact that prices are now no frozen at current levels does docs not mean that there will be no downward adjustments adjustments adjustments adjust adjust- ments in the future Unresolved Question On the contrary he said the unresolved question is whether and to what extent the purposes and provisions of the stabilization act require at least for some com com- modies a lower level or prices The f further u r t the h e r consideration I which the agency will proceed toe tog to g give e to the prices of commodities will determine the extent if any to which ceiling prices may need tobe tobe to tobe be reduced in order to effectuate the purposes of this act The statement continued The inflationary forces already at work in the economy are al already already already al- al i ready a foretaste of those that willbe will willbe willbe be created as our out defense program expands This situation calls for vigorous counteraction Over a period of time it may well be hoped that we can increase our total level of industrial industrial in industrial in- in production to the point where we can support our security programs and meet civilian demand demand demand de de- mand in full Immediate Danger which But thi is a slow process may take several years ears to accomplish accomplish Meanwhile the danger confronting confronting confronting con con- fronting us is immediate E ESA S A said that for every 2 Increase in the price level defense costs go up one billion dollars a year for year for every 1 rise in the cost of living consumers must spend an additional two billion dollars a year for the same goods and services cervices Prices spurted so high in the past few weeks E ESA S A said that if the rate continued we would see price increases of 30 or 40 or even 50 a year year this this path leads only to disaster and collapse Sen Bridges R. R N. N H H. in a statement put his finger on the fact that the freeze does not apply to many food items and added I cannot understand how such an order will be very useful to the average consumer in my state Bridges' Bridges statement took no note of a provision of a law in which congress stipulated that farm products cannot be brought under price control unless they are bringing more than parity parity parity-a a formula price level d designed to maintain the farmers farmer's purchasing power Many Items Exempted Many food items were exempted from the price freeze because of that provision stabilization officials officials officials said George Hansen president of the National Dry Goods said that organization of more than storekeepers will do all it can to help the controls work He saw the job ahead as twofold to halt disastrous inflation and to bolster the defense effort William Green president of th the e American Federation of Labor protested Prices have been steadily rising while wages have haye been pretty much standing still Unless we are ar e accorded the opportunity to wor work workout workout k out inequities the freeze is unjust t to o labor A C I q 0 vice ice president Michael Quill of New York called th the e I freeze a shocking blow to American American American Ameri Ameri- can wage earners and consumers William H. H Ruffin president of o othe f the National Association of Manufacturers Manufacturers Manufacturers Manu Manu- commented that price pric e and wage wa controls reach only th the e symptoms of inflation and not the th e cause The solution he said is greater production you pay-as-you-go taxation credit curbs and econom economy in spending General Reaction Tho The general reaction of businessmen businessmen businessmen busi busi- who commented was to offer support to the price control contro program m even oven though a number withheld approval and forecast hardships in their various fields Lingan A A. Warren president of oft t the e big Safeway grocery chain forecast immediate scarcities 01 of some items Hems such as meat Allan Alan B. B Kline president of the Farm Fann Bureau federation predicted that under controls America will wil lose Jose 10 to 15 of its potential production Jn ln five years He said The only way to stop inflation isto is isto to balance the national budget anc and reinstate the confidence of the people The American meri an Meat institute said Past experience has demonstrated demon demon- the crystal clarity that controls on any meat bring on black markets black market e prices and the disappearance of I those meats from legitimate chan than channels L eels nels of trade Had to Come Con Congressmen who commented generally agreed that controls conti had to come unwelcome as they areto are areto areto to many people Some said they think they should have been I slapped on months ago In view of ot the constant rise in the cost of l living Chairman Spence D. D Ky of the house banking committee noted that not only the purchasing power of the wage dollar but the savings saving of the people and the defense defense defense de de- costs of the government were pyramiding Sen Douglas D D. Ill Iii called the freeze probably necessary but urged added taxes to balance the budget Just six months late was the comment of Sen Capehart R R. Ind Better la late e than never said Sen Sparkman D. D Ala Sen R R. R In la Ia forecast black markets in meats with steak at 3 a pound Price stabilizer Michael V. V DiSalle said rationing Is not planned in the near future and may not come at all DiSalle was a key man in the formulation of the freeze order S SOS O 0 S to the 1 F FBI B I Officials turned Saturday to the mountainous task of making it work The office of ot price stabilization headed leaded by DiSalle sent an S 0 O Sto S So Sto to o the F FBI B I and other bureaus for help in enforcement President Truman ordered all federal agencies to pitch in as needed One official said the 0 O P S plans a ruthless enforcement effort at atthe atthe atthe the outset Oddly at the same time the theo o 0 OPS P S enforcement chief suddenly resigned He is Rear Admiral John I. I H. H Hoover retired naval officer His reason for quitting was not I clear an and repeated phone calls I Ito to his home got no answer Another Another Another An An- other official somewhat hesitantly quoted Hoover as saying he had completed his job of setting up the enforcement organization The wage stabilization boardW board W V S B which didn't order the wage vage freeze and took no responsibility responsibility responsibility for it renewed its work Saturday on a flexible formula to replace the freeze In a dramatic and turbulent setting setting set- set I ting ing nearly exhausted officials gave out the news of the freezes piecemeal piecemeal The process lasted from rom 6 pm p.m. until nearly 1 o'clock Saturday morning Ian l Many Not Frozen The price does not apply to o all prices A Along long Jong list of items including many foods still will have lave leeway to rise But most prices were frozen at athe atthe he the the highest level of the period from rom Dec 19 through Jan 25 25 day lay before yesterday Since very f few ew things have dropped in price during that period the general effect is to freeze Jan 25 prices Wages and salaries simply were frozen as of Jan 25 and no exemptions exemptions exemptions ex ex- were listed in the rife order Thus the wage board was under frightful pressure for speed Officials believe that the faster the board completes s i its s gene general al wage policy the better chance of I keeping management labor-management peace Board Chairman Cyrus S. S Ching told old reporters Now Note well we'll be forced to act as quickly as pos pos- sible Dont Blame Me Ching announced the wage freeze to the press but he was careful to point out that it was signed by Economic Stabilizer Eric Johnston who handed him the order just 10 minutes before the thc announcement was made DiSalle's and Ching's dung's agencies are technically technically cally branches of Johnstons Johnston's economic economic economic eco eco- stabilization on agency E S A and they are subject to his policy decisions The price freeze is only a stopgap stopgap stop stop- gap too and will vill melt gradually away as soon as separate orders can be prepared for various kinds of goods The only separate orders now in existence are on automobiles and hides But plenty more orders are coming Edward Phelps assistant assistant as as- price director said that within 30 days most retailers and some wholesalers w will be under new orders controlling their sales margins |