The Law & The Prophets

Can wise words save a nation? Could one man resolve the quarrel between free-enterprisers and the advocates of a planned economy? This week an elder statesman tried. Said 75-year-old Bernard Baruch, before the House Banking & Currency Committee:

"Pressure groups are on the march.. . . The gold dust thrown in all our eyes, by political abracadabra, only confuses, with gain to no one except temporary power to the economic magicians. We must mix brains with our brawn if we would keep our world leadership. We must steady ourselves in these emotional sweeps and keep our heads or the ship of democracy will wallow in this sea of confusion, spring a leak and disintegrate. . . . The whole world is watching us, amazed at the exhibition of a giant who cannot pull himself together even to take care of his own needs."

The Imperatives. What would Baruch suggest? In his credo there was little new, but he stated it with a categorical force and sincerity which few men in the U.S. could muster:

"Increase production. This is the Law and the Prophets--without it the rest of my suggestions are meaningless.

"Stop increasing money supply.

"Stop decreasing taxes until budget is balanced.

"Stop bunking the public by saying wage increases can be granted without increase in price levels.

"Increase prices or wages where necessary to get and stimulate production.

"Continue price controls, subject to indicated modifications for a year. Allow profit but no profiteering.

"Avoid favoritism to any particular group.

"Take care of those between the millstones--clerks, government employes, pensioners, et al.

"Make surpluses of goods in military hands available to compensate for shortages.

"Stimulate founding and financing Small Business.

"Take stock before blindly lending. . . .

"Cut government costs, including Federal, State, County and City. . . .

"Eliminate all strikes or lockouts for a year. . . .

"Set up a High Court of Commerce . . . which can decide questions involved in the above points and related subjects.

"Remember that a rotten spot anywhere in our system spreads and causes an illness everywhere.

"Avoid an economic dictatorship. . . .

"Up to Labor." His credo stated, Baruch elaborated:

"What becomes of all of the people when we expect government to pay out more if taxable profits are squeezed? Who gets any advantage if goods are not produced faster than wages are advanced and money printed? We cannot call this holding the line or just a bulge. To make the take-home worth while, more things at lower prices must be produced. That is up to labor more than management. Unless each man produces more than he receives, increases his output, there will be less for him and all the others. Each one will receive more money but have fewer things. . . .

"If a closefisted policy squeezes every bit of profit out of industry in order that some segment of society may apparently be advantaged; the government being the sole judge of this, we will arrive at an economy with our industries nearly all nationalized without a vote of the people--an economic and social revolution of greater proportions than we now realize--one that American labor will rue as much as others. . .

"The price structure is out of gear. I never favored subsidies but they have become a part of this tottering price edifice. I would continue those now in effect. I would give no more.

"For one year I would extend the present war powers, price fixing, and include wages, with the provision that no raise in prices be made without the approval of OPA, and no increase in wage scales without approval of the Office of Economic Stabilization."

No Strikes. "I am not opposed to helping foreign nations. But until production warrants it, I am opposed to lending them money or assisting them except for direct needs to make purchases when we know they cannot be made here or elsewhere. At this time that would be to increase demand. It would be cruel to hold out hopes that will not be realized.

"There should not be any strikes or lockouts for a period of at least one year by agreement preferably--otherwise by law. Mr. Bowles's new office can carry this out, taking care that no hardships are involved to the workers--or the employers."

Administration spokesmen could argue that many of the measures were indeed being carried out. Baruch's implied answer was that they were not being carried out competently. How would Baruch prohibit strikes and still keep what Americans understood to be their rights?

"I give you this thought," said Baruch. "There should be a high court of commerce set up to which [all economic] disputes can be taken for adjudication in order that we may work out a program on the basis of the principles which made this country great. If this is not done, we shall soon find ourselves in the morass of confusion that will bring us either to Fascism or Communism. . . ."

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