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Show News Ik Behini By Paul E Jallon ! Released by Western Newspaper Union. J MARK-UP OF FOREIGN MONIES I COMPLICATES OUR PROBLEMS i WASHINGTON. The Swedes have made the krona more costly to us. It is worth 27 cents plus, now, instead of 23 cents plus. The Canadians Cana-dians did the same thing. Their dollar has been marked equal to ours, instead of 90 cents, as formerly. former-ly. To whatever extent the rest of the world follows suit, its money will go. up in value and ours will , go down. Theoretically it can buy j more goods here, but only theoret- j ically, because actually our prices have gone up more than the 10 per I cent increased value of the foreign currencies. An item from South Africa tells the inside tale. It says American goods were being bought there in quantities hitherto hith-erto unknown until the OPA price ceilings went off, but since then purchases have been limited. limit-ed. Do we want them to fill their shops with goods (as they report) when we are short? Well, we want to increase our world trade. But can we do this with shortages? Of such considerations is the character of our oonfusion. Really it is worse. Today we are proving we can have inflation with a- balanced budget. BIGGEST PEACETIME BUDGET The main business of this adjourning adjourn-ing congress has been its least widely reported aspect. It was charged with appropriating money for Mr. Truman's unprecedented peacetime budget of nearly $40,000,-000,000. $40,000,-000,000. The house trimmed sharply sharp-ly but the senate put most of the money back in the bills, as is the custom. In the end Mr. Truman will get appropriations for this peacetime peace-time fiscal year (which began July 1) that are roughly four times and more, greater than what Mr. Roosevelt Roose-velt ever spent. The highest Roosevelt Roose-velt expenditures in prewar was $9,665,000,000 in 1940, when he took in nearly $6,000,000,000. In his whole administration he roughly took in half of what he spent, which was thought to be inflationary, although al-though it never got prices up. The spending is largely for army and navy, along with increases in peacetime activities of government. However, Mr. Truman is ap-proaching ap-proaching a balanced budget at this spending level. Wartime taxes have not been reduced materially, for fear of the big debt, so he will take in this year around or upwards of $35,000,000,000. (Retiring Budget Director Smith calculated the figure at $39,500,000,000, which is $8,000,-000,000 $8,000,-000,000 more than the January budget bud-get estimated.) Agitation thus has begun here for a real tax reduction, but some authorities want to retire the debt instead. In the war we roughly took in half what was spent, or about $46,400,000,000 in 1945, while spending $100,400,000,000. INFLATION IS HERE In the face of this promised stability sta-bility for the first time in 16 years, we have inflation. It is a real inflation, in-flation, due to a shortage of goods in the presence of widespread buying buy-ing power. The administration has figured it would stop the inflation as soon as it obtained production, but we are not getting production, and business estimates it will be three to five years before it can take care of accumulated demand, not calculating the increase in consumer consum-er demand which has developed from the presence of widespread buying power, To add to the deterrents deter-rents of strikes, slowdowns, governmental govern-mental mismanagement, famine relief, re-lief, the absence of a foreign trade policy, cheapening money, sensationally sensa-tionally high prices and no real peace, along with pitifully insufficient insuf-ficient production the OPA was sharply modified ahead of time. Can we get out of it? Yes, but only by shrewd management. manage-ment. By this I mean constructive construc-tive management of overall policy, pol-icy, as well as detailed affairs. Obviously we are entering a period pe-riod in which there will be no "normal." "nor-mal." It is a previously uncharted period. We are In inflation. Instead of "fearing inflation," as officialdom verbally does (and then shoots wages up, then prices, and next wages again), it must recognize we are in it. If we get production, and prices start to decline, we will recognize rec-ognize that the era in which we now are was a period of unprecedented I inflation. In a word, the govern-i govern-i ment has started the toboggan. The I question now is: can it be stopped? j Can it be stabilized? It has reached I a new level. Can this be kept? i CLEAR-CUT PURPOSES ' Certainly no satisfactory foreign trade agreement can be made loose- ly on such development as congres- sional approval of the $4,000,000,000 ! British loan (which really cancels 1 nearly $25,000,000,000 of lend lease although this figure was never men-, men-, tioned in connection with that action). ac-tion). To make a foreign trade policy, you would have to create full management for it, management manage-ment over goods and prices, as well as currencies. Such controls would be intolerable intoler-able and unworkable in peacetime. |