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Show MERRY-GO-ROUND OPA Downfall Disastrous To Economy By DREW PEARSON WASHINGTON As the year closes,-It may be wise to look back at what some experts predict pre-dict will prove to be the most disastrous economic development develop-ment of 1946. The general public has forgotten for-gotten the details of the terrific battle to "hold the line;- which began exactly one year ago and which today is already causing talk of a recession. So, just to keep the record straight let's dig under the campaign cam-paign oratory to see what actually ac-tually did happen and what may further happen In regard to the most Important economic Issue before the nation inflation infla-tion and the high cost of living. First let's take a look at what's happening in one key Industry In-dustry women's wear. During the battle of the OPA laat spring, the women's wear Industry Indus-try waa one of the leading foea of price control. In the end It got what it wanted. And perhaps per-haps as a result the entire Industry In-dustry today ia on. the spot Salesrooms Almost Deserted Stores throughout the country are loaded down with surplus stocks of women's wear. The salesrooms on Seventh avenue, New York, center of the women's wear trade, are almost without buyers. Skilled needlecraftsmen, who were able to work as many houra a day as they wanted, are either jobless or working only 10 to 12 hours a week. What happened was that prices went out of sight After the industry won Its O P A bat-, bat-, tie, it shot prices up so high that women started a virtual buyers' strike. Sales of women's wear . dropped off 20 per cent this December De-cember compared with last A federal reserve survey shows that the ratio of stock on hand, compared with sales, is now the highest in federal reserve history. his-tory. Outside the women's wear Industry, In-dustry, another tragedy la that thousands of small businessmen cannot plan for the future. They don't know what materials will cost or how much wages will be. That is a situation which doesn't help postwar conversion. It only helps depression. Placing the Responsibility So, clearing away the political debris, de-bris, let's look back and see who waa responsible for getting us Into all this. Chapter 1 The War: Whether we liked price control or not It worked unexpectedly well during dur-ing the war, and, Incidentally, la still working well In Canada and England. The men responsible respon-sible for making it work were Leon Henderson and Chester Bowles, who refused to play politics or yield to pressure groups. Result: The OPA served the public interest but won powerful enemies. Chapter 2 The Battle of Steel: One year ago came the first .big attack on the O P A the demand for Increased steel wagea, and simultaneously a trive for an Increase In the price of ateel. Although Bowles held out for two months against an Increase In ateel prices, John Snyder finally fi-nally persuaded ' Truman that thla waa the easy way out Bowles argued that ateel profits were so lush during the war that industry could afford a reasonable pay increase without any appreciable increase In the price of steel. In the end he waa overruled. Bowles, however, was right Today the U. S. Steel corporation corpora-tion has chalked up an increased profit In the first nine months of 1946, 196 per cent higher than during the first nine months of 1945 after taxes. Republic Steel has increased Its profits 211 per cent this year over last again, after taxes. Youngs-town Youngs-town Sheet and Tube has shot up 199 per cent during the same nine months of this year, while A Uegheny-L u d I u m, National Steel and Inland Steel have increased in-creased profits from 37 to 82 per cent all after taxes and after paying Increased wages. Chapter 3 King Cotton Tips .the Scale: The defeat on steel waa described as a "bulge." Actually, it sent a wave of price and wage increases through the nation's economy. Bowles tried to recover lost ground by moving mov-ing tn February for a quick decision de-cision by congress to renew the economic stabilization act and continue price controls for another an-other year. His appeal started one of the greatest lobbying drives ever seen In the nation's capital. In the end. It waa the cotton bloc that defeated price control con-trol Hitherto, the cotton congressmen con-gressmen had supported price stabilization, but at the decisive moment in the battle, they switched 33 key votes to the Republican aide and the bill was emasculated. The rest of the story Is too recent to need much retelling. Withholding became general from white shirts to radios and meat Demoralization spread throughout the country. The vetoing of the original OPA bill and the subsequent signing of a substitute which' waa Just as bad, probably contributed to Democratic defeat In November. The public recognized that this off-agaln, on-again policy not only was a victory for pressure pres-sure politics, but showed how weak the Truman administration really was. I Copyright, 1946, Bell Syndicate I |
