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WAR ECONOMY

PROGRAMME FOR UNITED STATES OUTLINED BY PRESIDENT ROOSEVELT. STABILISATION & SAVING. I By Telegraph—Press Association—Copyright) (Received This Day, 10.30 a.m.) WASHINGTON, April 27. “After Pearl Harbour, the American people adopted a national programme of war product ion which would have been called fantastic two years before,” said President Roosevelt, in outlining today an economic policy tiesigned to put the United States on a sound war footing. “11 has required shifting of a major part of American industry from products of peace to weapons of war.

“Inevitably, but with the nation’s full approval,” the President continued, “this enormous programme is dislocating industry, labour, agriculture and finance. It is disrupting the normal manner of life of every American family. In this we repeat the pattern of the first world war, although on a vastly greater scale. During the earlier war there were certain economic factors which produced unnecessary hardships, which continued long after the Armistice. It is my belief that a great deal of the suffering caused then can be avoided now. CHECK ON LIVING COSTS. “These economic factors relate primarily to an easily-understood phrase which affects the lives of all of us —the cost of living. Because rises in the cost of living in the last Avar were not checked at the beginning, the people of this country paid more than twice as much for the same things in 1920 as in 1914. The rise in the cost of living in this war has begun to parallel the last. The time has definitely come to halt the spiral and we can face the fact that there must be a drastic reduction in our standard of living. While the cost of living, based on the average prices of necessaries, has risen about fifteen per cent since the autumn of 1939, we must now act to keep it from soaring another eighty or ninety per cent in the next year or two and to hold it near its present level. We must therefore, adopt as one of our principal domestic objectives the stabilisation of the cost of living, for this is essential to the fortification of our whole economic structure.

SEVEN-POINT PLAN. “Relying on past and present experience,” said the President, “I list for Congress the following points which, taken together, may well be called our present national economic policy. In order, to keep the cost of living from spiralling upwards, we must:—“(1) Tax heavily, and in the process keep personal and corporate profits at a reasonable rate —the word reasonable being defined as a low level. “(2) Fix ceiling prices which consumers, retailers, wholesalers and manufacturers pay for the things they buy and also ceiling rents for dwellings in areas affected through war industries. “(3) Stabilise the remuneration received by individuals for their work. “(4) Stabilise the prices received by growers for the products of their lands. “(5) Encourage all citizens to contribute towards the cost of winning the war by purchasing war bonds with earnings, instead of using earnings to buy non-essential articles. “(6) Ration all essential commodities of which there is a scarcity, so that they may be distributed fairly among consumers, and not merely in accordance with financial ability to pay high prices for them. “(7) Discourage credit and instalment buying and encourage the paying off of debts, mortgages and) other obligations, for this promotes savings, retards excessive buying and adds to the amount available towards credit for the purchase of war bonds. “In the first item, legislation will be necessary and the subject is nowninder consideration in the House of Representatives, its purpose being to keep excess profits down and at the same time raise large sums for the financing of the war. This means that a sum equal to over half the entire national income will be spent for the war effort. Profits must be taxed to the utmost limit consistent with continued production—this means all business profits, not only from making munitions but from making or selling anything else. We seek to take by taxation all excess profits. At the same time, discrepancies between low personal incomes and high personal incomes should be lessened. I therefore believe that in this grave national danger, when all excess income should go to win the war, no citizen ought to have a net income of more than 25,000 dollars a year. “The second item is adequately covered by the existing law. The third item will not require legislation under present circumstances. I believe that the'stabilising of the cost of living will mean that wages generally can and should be kept at their existing scales.

PARITY FOR FARMERS. “Regarding item 4, for nearly nine years it has been the policy of the Government to seek the objective known as parity —in other words farm prices that give the farmer an assurance of equality of individual puichasing power with his fellow-Americans in industry. Some farm products have not yet reached parity; others have exceeded parity. Under the existing legislation, a ceiling cannot be placed on certain products until they reach a level somewhat above parity. This calls for legislative action restoring the original excellent objective of obtaining parity for farmers.” Concerning item 5, Mr Roosevelt said “In order to raise the billions needed to pay for the war and at the sanr time prevent a disastrous rise in th' cost of living, we must more than double the scale of our savings. Ever? dime and every dollar not vitally needed for absolute necessities should go into war bonds and stamps, to a< to the striking power of the armed forces. I have been urged to recommend the adoption of a compulsory plan of savings by deducting a certain percentage from everyone’s income. 1 prefer, however, to keep the voluntary plan in effect as long as possible. LIMITS ON RATIONING. “Regarding item 6, I am confident that for the basic necessities of Iff' rationing will not be necessary, because we will strive to the utmost to

have an adequate supply, but’ where an important article becomes scarce, rationing is a democratic and equitable solution. Item 7 should be made effective as soon as possible now that money is becoming more plentiful. When the war is over, the elimination of private debts and the accumulation of savings will provide a form of insurance against post-war depression. “The result will mean that everyone will have to give up many things to which they are accustomed,” Mr Roosevelt concluded. We will have less creature comforts than in peace time. Our standard of living will have to come down.”

Permanent link to this item
Hononga pūmau ki tēnei tūemi

https://paperspast.natlib.govt.nz/newspapers/WAITA19420428.2.32

Bibliographic details
Ngā taipitopito pukapuka

Wairarapa Times-Age, 28 April 1942, Page 3

Word count
Tapeke kupu
1,094

WAR ECONOMY Wairarapa Times-Age, 28 April 1942, Page 3

WAR ECONOMY Wairarapa Times-Age, 28 April 1942, Page 3

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