A Stick for a Club

Congress had only until Saturday midnight to act. By then the Defense Production Act would expire, and with it all the President's power to control a galloping war economy. Obviously Congress would not let that happen. Congressional leaders got set to jam through a temporary extension until a new bill was ready to take its place. That new bill is not apt to please Harry Truman at all.

For two months, the Banking and Currency committees of the two houses had debated the subject with an air of leisureliness, skepticism and downright hostility towards the White House. In separate bills reported out last week, they agreed to give the President almost none of the increased authority he sought. They also agreed--over the protests of Administration Democrats--to take away some of the power which Congress had given him last September. When a final bill does get to the White House, instead of having a club to fight the devils of inflation, Harry Truman will have only a stick.

The committees had rejected the President's plea for a two-year extension of present controls. One year, said the House committee; no, only eight.months, said the Senate. In response to the honks of auto dealers, Congressmen relaxed Regulation W, to let installment buying run 18 months instead of the present 15. The House bill would also ease the terms of installment buying of television and radio sets.

Both bills would cut into the heart of Price Stabilizer Michael Di Salle's most ambitious plans by prohibiting further rollbacks in meat prices. This was in response to the clamor of cattlemen. Di Salle protested that if Congress held to its position, U.S. consumers would have to pay $2.5 billion more a year for goods and food.

Despite the direct appeals of the President and his advisers, there had been no real clamor from consumers for more controls. The Administration warned that the U.S. hadn't seen anything yet, that defense spending was not yet really under way, but that shortly it would be going at high speed, at the rate of some $50 billion a year. But in the current calm, when some prices were even softening, the consumer either didn't believe that prices would suddenly shoot up, or simply had not bothered to write his Congressman. As for Congressmen, they were against giving Harry Truman sweeping authority until they saw danger, clear & present.

When it came to taxes, the Administration got help from Congress. The House, acting on the President's request, passed, 233 to 160, the biggest tax increase ($7.2 billion) in history and sent it on to the Senate. The bill would increase individual income taxes by 12 1/2%, beginning Sept. 1. It would increase corporation taxes by 5%. It would also hit the average man for a total of some $1.3 billion in pennies, nickels & dimes in excise taxes.

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