Evening star. [volume], March 15, 1963, Page A-9, Image 9

About Evening star. [volume] (Washington, D.C.) 1854-1972

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DAVID LAWRENCE
Factors for Economic Growth
Other Incentives Besides Tax Cut
Offered as Anti-Depression Moves
The American people are
being told repeatedly that a
tax cut will bring prosperity.
Yet it's just one of five or
more major factors that are
essential to the economic
growth of the United States.
If the other incentives are ig
nored—as is the case today—
a depression of the severest
kind can conceivably confront
thia country in the next few
years.
One trouble is that figures
are being given out current
ly to generate optimism, but
they are not being explained
to the public in true perspec
tive.
Thus, an announcment this
week from the United Stales
Department of Commerce
forecasts business expendi
tures for new plant and
equipment this year at a
"record 139.1 billion.”
But of what good are gen
eralities about "record spend
ing” when it turns out that
the increase in projects for
plant and equipment in 1963
will be the second smallest
in 17 years? There have been
Increases in 13 out of the
last 17 years. It is the rate
of Increase, rather than the
total figure, that counts.
Take also the item of
profits of corporations. Econ
omists estimate that profits
will total |27.5 billion in the
fourth quarter of 1963. This
could be emphasized by the
over-optimistic as equaling
the highest record in history.
But what kind of record is
it for corporate profits to
reach $27.5 billion this year,
when they were the same ex
actly 13 years ago in the last
quarter of 1950? This hardly
indicates progress.
Furthermore, in 1950 these
profits were 9 per cent of the
gross national product, but in
1962 they were only 4.7 per
cent. If the rate of profit In
terms of the gross national
product keeps going down and
the total profits make no in
crease over what they were
12 years ago, the word to use
is not “progress" but "stag
nation.”
President Kennedy is put
ting all his eggs in one baa-
DORIS FLEESON
Kennedy's Trip for the Alliance
President Will Bolster Hemisphere Plan
In Visit to Costa Rica Next Week
President Kennedy will
take personal command of
the effort to shore up the
shaky Alliance for Progress
program for Latin America
In a visit to Costa Rica next
week.
This week Senator George
McGovern, South Dakota
Democrat and former direc
tor of the Food for Peace
program, undertook to plow
some ground for him. It was
Mr. McGovern's maiden
speech and combined an at
tack on what he termed "our
Castro fixation” with an ap
peal to Congress to push on
with the "tough and painful”
task of making the Alliance
work.
The Alliance, as with all
foreign aid, is regarded with
unusual sourness by a Con
gress asked to accept some
unorthodox economics, in
cluding a tax cut and a heav
ily unbalanced budget. Its
especial weakness is the fail
ure of Latin American coun
tries to seek their own salva
tion in reform of the systems
which have impoverished
their people.
JOSEPH KRAFT
For Malaise, a Dose of Reality
Statement of U. S. Role by President
In Europe Expected to Be Helpful
At his last news confer
ence the President observed
that governments, like peo
ple, have their ups and
downs. But people tend to
make their own breaks, and
If the Government Is to get
a lift, the President will have
to lend a hand. One Impor
tant opportunity is his com
ing tour of Western Europe.
Properly handled, the trip
could administer to the na
tional malaise the exact spe
cific it needs—which is a
dose of reality.
For what has gone wrong
in the past few months is
not truly expressed by the
pinpricks at untoward events.
The main trouble is not that
unemployment has passed the
6 per cent mark; or that the
"club” still dominates the
Senate; or that the Presi
dent has had a hard time
rounding up a public commit
tee for his tax program; or
that Soviet troops are in
Cuba; or that the North At
lantic alliance seems to be
floundering. The real dif
ficulty is that the national
thinking process has been di
verted into an abstract, logic
chopping debate that is
about as fruitful as discus
sion of whether or not life
is really a fountain. In con
sequence, there has grown up
between the problems we face
and the Issues we argue a re
lationship of systematic ir
relevance.
Serious address to domestic
economic problems Is hung up
on a question mediaeval
schoolmen would have been
proud to Invent; whether the
rule of the family budget
should apply to the national
ket. He is depending on a tax
cut alone. The emphasis
seems to be on stimulating
"spending" by means of a tax
cut of $lO billion spread over
the next three years. "Pump
priming” of this kind, how
ever, has failed again and
again to bring sound business
conditions and has resulted
instead in a series of setbacks
every few years. The main
reason is that other factors
have been neglected. Lasting
improvements rather than
temporary palliatives are
needed.
What seems most unfor
tunate Is the complete indif
ference exhibited here in
Washington to the factors
that could produce a well
balanced and sound economy
in the decade ahead. Among
them are the following:
1. Removal of Government
barriers to marketing opera
tions that could increase the
total volume of sales.
2. An increase in the rate
of profit per dollar of sales.
This would Involve encour
agement of automation and a
general reduction of costs, but
it also would mean more vol
ume of business. The big
telephone companies, for in
stance, employ more people
since they introduced auto
matic phones than before.
Employment is reallocated
due to automation, but the
sum total of jobs is increased.
3. Legislative action to per
mit a system of fair competi
tion In which interferences
with marketing are elimi
nated, and no monopolies by
any company or labor organi
zation are tolerated.
4. A prohibition against in
dustry-wide "bargaining" for
labor agreements, because
they tend to produce monop
olies by forcing marginal
companies out of business
through high labor costs and
by bringing about mergers
that reduce or eliminate com
petition within an Industry.
5. An encouragement of
trade with the rest of .the
world by a comprehensive
plan which would Include not
merely a system of reciprocal
tariffs and trade arrange-
They have come to believe
at last that Congress may be
balking, judging by various
impassioned public relations
efforts they are making. Cer
tainly. they are necessarily
impressed when a veteran
New Dealer, Senator Ernest
Gruening of Alaska, spreads
a terse, forceful warning on
the Congressional Record as
he did last week.
Senator McGovern’s inter
est in the historic American
role of relieving human mis
ery, as reflected in his exec
utive job, permeated his long
review of Latin American
sufferings at the hands of its
own rulers. This was to be
expected: he knows the story
well at first hand.
His blunt comments on
"Castro fixation" are pos
sibly even more welcome in
the White House, which
shares his view but hesitates
to call Congress to account
on the wisdom of its course.
As Mr. McGovern sees it,
Nikita Khrushchev has, by
embracing Fidel Castro,
reduced Mr. Castro’s appeal
in this hemisphere. But,
argued the Senator, the
budget. The Defense Depart
ment has been dragged into
a hunt for a definition of
something sensible men have
long known to be Indefinable
—the right relationship be
tween civilian management,
on the one hand, and the
generals, the Congress and
the press on the other. The
Supreme Court, which has
Important business to trans
act in matters of civil rights
and legislative reapportion
ment, has to stake its full
majesty on the issue of
whether it is constitutional
for 8-year-olds to read
prayers in school. The Sen
ate Foreign Relations Com
mittee—which might be mak
ing a contribution to Euro
pean issues—is Instead beat
ing the old, if not dead, horse
of improper influence by rep
resentatives of foreign gov
ernments.
The usual recipe for this
state of affairs is to cry
havoc. But no one really ex
pects a major war. The
Pentagon has not only closed
the missile gap; it is now
coming clean with the evi
dence that even in Europe,
Western forces can put up
quite a respectable fight. Nei
ther does anyone seriously
believe that a depression is
around the comer. The most
pessimistic forecasts seem to
rest on the argument that
whereas the last three recov
eries lasted 45. 35, and 25
months respectively, the pres
ent upswing is entering its
25‘h month —a demonstra
tion about as Euclidian as
eating soup with a knife.
It is in these circumstances
that the coming European
trip and notably its West
ments with large areas or
regions embracing several
countries, but also a wider
Investment of American cap
ital abroad.
6. A re-examination of the
whole range of foreign in
vestment so that individual
American companies will be
protected against confisca
tion or harassment at the
whim of changing regimes,
especially in Latin America.
A formula by which the
United States Government
guarantees a certain portion
of the investment would
probably achieve this pur
pose. especially since in times
of default or domestic tur
bulence the protests of one
or more private businesses
are futile, whereas the power
and Influence of the Ameri
can Government is bound to
insure a large measure of
protection for the investors.
While the growth in
American exports in the last
decade has been consider
able. and Imports have in
creased, too. the surface has
hardly been scratched on
what can be done to enlarge
American sales opportunities
abroad. Not enough time has
been given by Congress to
the study of how America's
domestic economy can be
enlarged by production of
materials and finished goods
needed in other countries to
raise standards of living for
the people.
These projects could be
financed by foreign govern
ments in co-operation with
American companies that do
business abroad. To blend
the private and public sectors
in foreign-trade projects has
been an objective often ex
pressed, and some progress
has been made along this
line through various inter
national financial institu
tions. But the amounts forth
coming are still negligible,
and -the Impact on world
trade is infinitesimal com
pared to what it could be.
Permanent measures that
will take the brakes off the
national economy and rid it
of impediments to progress
are the crying need of the
times.
<Csi>rrlsht. ISSSi
Russian investment has
been worthwhile to him as
a “gadfly to divert the at
tention of the United States
from the real dangers and
challenges of Latin Amer
ica."
This position would once
have provoked some lively
debate, pro and con. But
such is out of fashion. Mem
bers of the Senate and
House today prefer in the
television. age to spread
their views on the screen,
rather than slug on the
floor.
It took. Indeed, some
courage for the freshman
Democrat to lead an argu
ment in these terms, as his
Republican colleague. Sen
ator Karl Mundt, is among
those who make anti-Com
munism an end in itself.
Mr. McGovern suggests that
the American mission is "to
point the way to a better
life.”
Gov. Rockefeller, the
President’s probable rival
next year, has demonstrated
his belief that the faltering
Alliance is a good political
issue against the admin
istration. If for no other
reason, the President will
not give ground on it wil
lingly.
German phase presents
itself. For with the right
routes and the right sup
porting cast, the President
can assert anew a string of
home truths: That the United
States is a great power with
world responsibilities; thet by
steady effort over many years
this country has made pos
sible the survival and pros
perity of the Western world;
that it still maintains the
outposts of freedom, and that
millions of free men are glad
of It. Set against that kind
of reality, the national prob
lems take on their proper
perspective. They emerge, not
as pseudo-philosophic puz
zles. but as aspects of world
leadership practical chal
lenges requiring concrete
answers.
To be sure, there are evi
dent risks in building up
the European tour. One is
the danger of taking on, or
seeming to take on, new com
mitments that might further
unsettle relations with the
Soviet Union. But nothing in
the Constitution decrees
what the President has to
say abroad. West Berlin, in
particular, might be an ideal
forum for a restatement of
the Atlantic partnership
ideal which encompasses this
country's German policy.
Another riak is Gen. de
Gaulle. The recent Franco-
German friendship treaty is
up for ratification by the
Bundestag sometime in late
spring. The general and
Chancellor Adenauer will
want to celebrate the union
in some Carolingian rit
ual, no doubt. But li Gen.
de Gaulle elects to use the
occasion for an Invidious
popularity contest, that will
be his choice, not that of
the President.
BILL MAULDIN'S CARTOON
•i
*THANK ALLAH WE'RE AIR-CONWTIOH&i ♦.
• * •
POTOMAC FEVER
By FLETCHER KNEBEL
TFX bulletin: Military men are grousing about Defense
Secretary McNamara's iron rule of the Pentagon. They say
the only officer promoted recently was General Dynamics.
*• • •
Britain censors a satirical stage skit about Queen Eliza
beth. Jackie Kennedy's reported thought: "Oh, to be queen
for a day.”
•* * *
The final indignity of politics: The isolationist who
came down with Asian flu.
.* * * •
Pentagon Spokesman Sylvester says he never lies to
Amercans, only tries to mislead the enemy. Next time you
hear him making an announcement in Russian, don't believe
a word of it.
•« * *
They've come out with a new inoculation for poison ivy.
Slogan: An itch in time saves nine.
•« « •
Red China invites Russia to a summit conference. It's
a real Communist cliff-hanger. Will Mao Tse-tung rescue
Khrushchev from the brink of peace?
Two Bridge Contests
Slated Next Week
Two Washington area con
tests will be held next week In
conjunction with the American
Contract Bridge League’s Na
tion-wide Spring National
Championships for charity.
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Cell for Information 24 HOURS A DAT, 7 DAYS
JA. 4-3235 A WIIK
LIMITIO WINTER Os FIR D. C.—MD. —VA.
The Washington Bridge
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WILLIAM S. WHITE
Dangerous Labels Poised to Roost
Democrats Have 'Softness' to Fear
On Cuba, G. O. P. Dodges 'War Party'
Republicans and Demo
crats alike are walking over
political minefields now over
Castro Cuba, and of this their
wisest leaders are poignantly
aware.
The ultimate fear of the
ablest Democrats is that their
party may wind up convicted
of undue "softness” toward
Communist Cuba. The ulti
mate fear of the ablest Re
publicans is that theirs may
wind up tagged as the "War
Party.” There is every rea
son for both concerns.
Rarely in the endlessly
marching world crises of three
decades have both American
parties confronted such subtle
crises of their own in the
matter of how to deal with a
foreign danger with strength
and yet with prudence, with
care for national safety and
with care also for party
safety.
In both, the most profound
inner struggles are now going
on. Within the G. O. P. one
set of antagonists is made up
of the top G. O. P. Congres
sional leaders, notably Sena
tor Dirksen of Illinois and
Representative Halleck of In
diana. This set wishes to press
the Kennedy administration
for more action—but not
enough action to accept the
imminent threat of major
war.
The other set, typified by
Republican National Chair
man William E. Miller, de
mands far more risky moves
against Castro—for example,
an unrestricted blockade
which in itself would be an
act of war.
Within the Democratic
Party one set of antagonists
is made up primarily of
second-rank but articulate
bureaucrats from the admin
istration. It wishes to halt
substantially all criticism of
the President. These people,
men like Undersecretary of
State George Ball, really are
demanding, consciously or
not, that the country simply
take all administration deci
sions on Cuba on faith, and
cease making trouble.
The other Democratic fac
tion is exemplified by Sena
tors like Symington of Mis-
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THE EVENING STAR
Woikrngton, 0, C, hUay, March 15, 1943
sourl, a 1960 presidential as
pirant, and Russell of Geor
gia, perhaps the most influ
ential single member in ei
ther house of Congress. This
faction, while not fairly open
to the epithet "warhawk,” is
not at all satisfied the ad
ministration has gone far
enough in coping with Castro.
Like the Dirksen-Halleck
wing of the G. O. P. the
Symingtons and Russells
would run more risk than the
President is chancing, but
would stop short of the ex
treme line of which Chairman
Miner and, say, Senator Barry
Goldwater, are exemplars.
Now. one other point should
be totally understood. Nobody
in these four sets of earn
estly contending men differs
with anybody else as to the
objective. All most truly want
to see an end of communism
in this hemisphere. It is not
differing motives which are
involved here; it is differing
Judgments.
To this columnist, among
the Republicans the Dirksens
and Hallecks are right, and
among the Democrats the
Russells and Symingtons are
right.
For, finally to adopt the
Miller line the G. O. P. will
attach the "War Party” label
to itself, with grave probable
political consequences for
1964, quite apart from the
grave error in substantive
policy that line would in
volve. And if the Ball-Admin
istration people prevail
among the Democrats, the
Democratic Party will enter
1964 under heavy charge that
it did not fully face up to
communism.
What is needed is a work
ing concert among the Presi
dent, the Dirksens, Hallecks,
Symingtons and Russells, ex
cluding alike the Millers and
Goldwaters and those admin
istration people who cling to
the claim that all is well as it
stands.
This concert should en
courage the President, as the
final authority, to set upon a
policy more affirmative than
at present but yet treating
war as the very last resort.
Surely such a policy, for one
thing, should contemplate a
far harder and more open
pressure than is now being
exerted upon our Latin Amer
ican neighbors to see Cuba
as a hemisphere cancer and -
to join with us to cut it oqt,
one way or another.
<Cop>rl|t>t. 1863)
Bench Experience
Ratio Urged for. ,
Court Appointees,
Half of all future appolnUa»-
| to the Supreme Court would be
required to have at least 10
years' experience on the bench
If a resolution Introduced yes
terday by Senator Stennis,
Democrat of Mississippi, passes.
The Senator said that only
three ot the nine present jus
tices had prior Judicial experi
ence, and added, "this is notn
[healthy trend.”
Senator Stennis aaid that be--
fore 1932 a majority of Su
preme Court justices had print
Judlclal experience. But from
1932 until now a majority of the
appointees did not.
Senator Stennis is proposing,
that every other appointntaat*
be made from persons with
prior judicial experience. Thp
Senator mentioned Chief Jtls
tlce John Marshall, Chief Jus
tlce Charles Evans Hughes and
Justice Louis Brandeia as three
examples of "outstanding”,
justices who had no prior ex
perience. and he pointed out
his resolution would still per
mit the appointment of Mini'
outstanding lawyers who had
not been judges. .
Fair Skies Expecte4 n
For Irish Parade .a..«?
NEW YORK. Mar. 15 (APfJ'
—The Weather Bureau hka.i
forecast fair skies and milder
temperatures for New York's,:
celebration tomorrow of St.
Patrick's Day with its tradl-''
tlonal Fifth avenue parade; '
The event was scheduled for '
Saturday because the great day .'
for the Irish falls on Sunday
this year.
Some 125.000 persons. In
cluding 200 or more bands, are
expected to march before
million spectators.
A-9