The Avalanche Rumbles

Like a reluctant avalanche Franklin Roosevelt's Administration began to move. The public had shouted for action but its shouts had had no more effect than firecrackers in moving a mountainside. The President's popularity, measured by the Gallup poll, had sunk from 84% after Pearl Harbor, to 78% a month ago, to 70% last week.

But none of these things started the avalanche. It formed slowly, as avalanches usually do when the sun after shining for some time produces a critical thaw releasing the forces of nature. So many necessities of war and economics had finally begun to show that the Administration had to move and the rumbles of its movement came on a dozen fronts.

The Administration came to the point of putting the nation on meat rations. It made clear its intention of drafting an army so huge that most of the able-bodied men in the nation will be in uniform within a few months. Its final decision on the rubber problem was being rapidly drafted by the hands of Bernard Baruch. Its own internal pressures were slowly bringing nearer a reorganization of the War Production Board.

And on one of the most pressing, immediate problems of all--inflation--President Roosevelt himself put out his hands and groped for a hold on it.

Franklin Roosevelt finally admitted that the Price Control Act had proved a flop, because the Administration was afraid to crack down on wage inflation and Congress was afraid to stop farm inflation. He had a feeling, he told his press conference, that the nation was being whipsawed between labor and farm groups. Without prompt action, food prices might rise another 30%, the cost of living would get out of hand. So he was ready to stabilize both wages and farm prices. The best guarantee that he meant what he said was that he arranged to break the news of his plan--in a message to Congress and fireside chat to the people--on Labor Day.

But first the President had to devise his plan and if possible win labor's consent. So last week the two top men of U.S. labor --A.F. of L.'s William Green and C.I.O.'s Philip Murray--trotted into the White House. When they emerged, it was clear that they were still opposed to wage control at any price. But Franklin Roosevelt went ahead with his plans.

Rather than throw the whole problem into Congress' lap and wait for a long debate and another unsatisfactory compromise, he planned to act without Congress --to attack inflation under an executive order based on his wartime powers.

The shape of the order was nearly determined at week's end. The President planned to establish a new Economic Stabilization Board: Price Boss Leon Henderson, Secretary of Agriculture Claude Wickard, War Labor Board Chairman William H. Davis, Secretary of the Treasury Henry Morgenthau Jr., Federal Reserve Chairman Marriner S. Eccles, Budget Director Harold Smith and probably an outside chairman as yet unnamed. The board would administer price control, formulate wage policy, make tax recommendations.

Henceforth all wage increases, even voluntary ones, would be approved by WLB, which in turn would take orders from the new board. So would OPA which controls prices. (On farm prices, the course was less clear. Franklin Roosevelt did not yet know whether his wartime powers were sufficient to overrule Congress, or whether his new board would have to be governed by the law that prohibits agricultural price control below 110% of parity.)

Economic High Command? What were the chances of the President's scheme really controlling inflation? Judging by the record of other Presidential creations, not much. But a great deal depended on the chairman and the power that Franklin Roosevelt gave him. If the board really does the job it is set up to do, it would in the nature of things become, in fact if not in name, an economic high command.

The new board did not sound like a high command. On it were the same men who had long bickered over wage and farm policy, over fiscal and tax theory. Already some had protested strongly, had tried to change the pattern to preserve their own authority. Except on theory that fighting produces better results when all the protagonists are in the same room, the Economic Stabilization Board looked as if it might take a little stabilizing itself. Only a real economic high commander at the top could keep such a board moving in a straight line.

Until it was finally blueprinted, finally given its orders and its powers, there was still hope for the new board. But there would be no assurance of its success until it had been proved that neither the farm bloc nor Messrs. Green and Murray could buck it as they have successfully bucked its individual members heretofore. They would give the board its real test.

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