A Vote for Phase III

During Richard Nixon's long and almost theological campaign against the idea of wage-price controls--which ended abruptly last Aug. 15 with the laying down of the New Economic Policy--he was widely thought to be reflecting the wishes of big businessmen. Nixon and his principal advisers still dislike controls, and they have promised to abolish them at the first possible moment. Quite a few business leaders, however, have become increasingly devoted converts to governmental guidelines. An especially telling sign of their approval came last week in a report by the Committee for Economic Development, an organization of top-ranking corporate chieftains--including executives of Jersey Standard, Caterpillar Tractor, IBM and Continental Can. The group called for a long-term Phase III that would involve a "continuing, direct Government role in wage and price policies even after compulsory controls are lifted."

The C.E.D. report recommended the appointment of a single presidential board to set such policies, in contrast to the separate wage and price groups that make Phase II decisions. The board would set "relatively broad norms" for allowing higher prices and wages, with "greater discretion" than is now allowed for both wage boosts and higher corporate profit margins. The Phase III guidelines would be essentially voluntary, but if either a corporation or a labor union failed to stay in line with them, the C.E.D. said, the new board should have the power to recommend that the Government place it under compulsory controls.

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