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Show m V. i J 1 . -. ... - r- ' AHO WERE OPPOSED TO g)lL'EM 091'! ' We are about to enter the second year of President Carter's wageprice guidelines program. It's obvious that the first year was not a success as inflation has climbed to a 13 percent annual rate. The administration claims that were it not for energy, food, housing and hospital costs, inflation would be right around 7 per cent. But if you remove those four areas from the economy, what's left to inflate? As for the guidelines themselves, it is illusory to promise Americans Ameri-cans that by holding down wages and prices we can slow inflation. Wages and prices are symptoms of inflation, not causes. The cause of inflation is placing too many dollars into too many pockets while at the same time restraining an adequate amount of goods from entering the market to absorb those dollars. The result is skyrocketing prices and the devaluation of the dollar. Another problem we have with the guidelines is that they are called voluntary. But how can they be voluntary when they carry penalties for noncompliance? Wageprice controls whether in the form of guidelines, Stan- ' dards or freezes are temporary restraints that only lead to scarcities, scarci-ties, black markets and even higher rates of inflation. They can be likened to a cork that is plugged into a volcano to keep it from erupting. Although at first the volcano is stopped up, it continues to churn inside until it blows off the cork. Guidelines, tco, appear to slow inflation, but soon violations occur, the program crumbles and inflation runs wilder than before. Ileane Rosenthal of the National Association of Manufactures summed up the situation nicely when she said: "President Carter is attacking the wrong thing. All the guidelines do is: (a) blame business busi-ness and labor for inflation when it is really government's creation, (b) transform the word 'voluntary' into 'mandatory' and (c) address the symptom of the disease wages and prices while failing to look at the actual cause government." Our advice to the administration is, "Physician, heal thyself." |