Ford Wins a Fight over Jobs

By every recent measure of public sentiment, the economy is far and away the dominant political issue of 1976. Though many more Americans worry about inflation than unemployment, concern over jobs ranks well ahead of any noneconomic issue, including crime and detente. Democrats assail President Ford for a lack of urgent action on jobs; Ford and most Republicans respond that the recovery is strong and no costly emergency program is needed.

Last week's statistics lent weight to the President's position. In the final quarter of 1975, the gross national product rose at a rate of 4.9%, its third consecutive quarterly increase; and inflation climbed at a 6.8% rate, down .3% from the preceding quarter. The New York Stock Exchange last week set a one-day trading record of 44,510,000 shares, and the Dow Jones industrial average surged 26.85 points in two days, to 987.80--its highest level in three years.

Ford, moreover, won a major legislative battle as the Senate failed by three votes to override his veto of an emergency $6.2 billion public works bill, which Democratic congressional leaders claimed would have created at least 600,000 new jobs within a year. But Ford, backed by many economists, considers the creation of public works projects an expensive approach to reducing unemployment. He places higher priority on stimulating the private economy to produce longer-lasting jobs.

The public works and urban aid bill would have: 1) given $2.5 billion to state and local governments for such projects as constructing and repairing schools, courthouses, hospitals and other public buildings; 2) provided added revenue-sharing funds to state and local governments whenever the national unemployment rate is 6% or more (it is now 7.8%) and only to those areas matching or exceeding the national rate; 3) spent more money for such existing programs as construction of water-purification plants, capital loans to businesses and the Job Opportunities Program.

Wrong Time. The House had passed the bill last month by a smashing margin of 321 to 80. The Senate in July had approved it, 65 to 28. But Ford used his 43rd veto to reject the bill, calling it "an election-year pork barrel." At his press conference last week, Ford attacked it as "a hoax." Most analysts agreed with him that it would have created far fewer than 600,000 jobs--although Ford's estimates that it would produce only some 100,000 jobs at a cost of more than $25,000 per job were exaggerations in the opposite direction. His telling argument was that the stimulus to the economy probably would come "at precisely the wrong time --when the recovery will already be far advanced." The result then might be a new surge of inflation.

Those arguments did not impress the House, which last week easily overrode Ford's veto, 319 to 98. The Senate's 63-to-35 margin to override, however, fell short of the needed two-thirds.

The Democrats may revive the rejected bill, but with less funding and without the revenue-sharing provision. Ford has indicated he will accept a bill by Senator Robert Griffin and Congressman Garry Brown, both Michigan Republicans. It would give federal funds for community development projects to local governments where unemployment is more than 8%. Brown estimates that his plan would provide about $800 million in the next fiscal year.

A sharper clash may come on a more comprehensive bill being pushed by two Democrats, Senator Hubert Humphrey and Congressman Augustus Hawkins of California. It would set "full employment" as a national goal to be met within perhaps three years; 3% would be the target unemployment rate. The President would have to submit plans to provide every American "able and willing to work" with a job, using a "standby job corps" to hire those unable to find employment. The independent Federal Reserve Board would be required to tailor its monetary policies to meet the employment target--a step toward a planned national economy.

Conservative economists consider the economy too complex to ensure jobs for all workers without rigid wage and price controls. Unless the economy nosedives unexpectedly, the Humphrey-Hawkins bill seems unlikely to be enacted--and the rising economic trend remains Gerald Ford's best argument as he seeks to retain the presidency.

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