From Lag to Sag

As Democratic chieftains in the Senate saw it last week, their party's Big Issue for this fall's congressional elections will no longer be the missile lag but the economic sag. The shift from lag to sag was evident both in dark grey oratory on the Senate floor and in busy bill-drafting off the floor.

"The people of this country are in serious economic trouble," cried Michigan's Pat McNamara. With Massachusetts' John Kennedy, McNamara co-sponsored a bill to fatten state unemployment benefits and make them run for 39 weeks instead of the now-usual 26. Tennessee's Albert Gore introduced a bill to boost federal aid to state and local governments for public-works projects. In keeping with a grand design sketched out by Majority Leader Lyndon Johnson--who was working on the economy when not busy with space--Senate Democrats were drafting six other recession-inspired bills, calling for increased federal spending for: roads (Gore), housing (Alabama's John Spark-man), hospitals (Alabama's Lister Hill), reclamation (New Mexico's Clinton Anderson), flood control (Oklahoma's Robert Kerr), aid to small business (Arkansas' William Fulbright).

At the other end of Pennsylvania Avenue, President Eisenhower told his press conference that, in the opinion of his economic advisers, "it is reasonable to assume some upturn sometime toward the middle or just after the middle of the year." To a newsman who asked whether the Administration might push for a tax cut if the economy failed to perk up at midyear, Ike replied yes, added that there is such a thing as "going too far with trying to fool with our economy."

Backing up the President, Treasury Secretary Robert B. Anderson and Federal Reserve Board Chairman William McChesney Martin agreed in testimony before Capitol Hill's Joint Economic Committee that 1) the U.S. economy is basically healthy and can be expected to recover its zip without drastic Government medication, and 2) strong hypodermics, such as a deficit-producing tax cut, might do harm by stimulating inflation fever. Inflation, warned Chairman Martin, will be "one of the most crucial problems we have to face over the next couple of years." Said Anderson: "I can conceive of situations where tax reductions might appropriately be brought into play, [but] the present condition of the economy does not warrant such action now." He added a firm promise: "Neither inflation nor deflation will be allowed to run a ruinous course."

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