Shadow of Inflation

Hell broke loose again last week on the inflation front. The farm and labor blocs, warily watching each other to grab any tactical advantage, got set for an organized assault on the whole anti-inflation program.

Farm Strategy. Three times in the 77th Congress the farm bloc had been whipped in its effort to write the cost of farm labor into the farm parity formula. Last week the House Agricultural Committee quietly approved a bill which would do it all over again. Although the bill would add another $3 1/2 billions to the nation's food costs, the committee did not bother to ask the opinion of OPA Boss Prentiss Brown--who had fought the issue as a Senator last year--or of Economic Stabilizer James F. Byrnes. Said the bill's sponsor, Georgia's swarthy Stephen M. Pace: "No hearings were needed."

Labor's Strategy. Organized labor would have needed no more excuse than this farm bloc maneuver to open demands for wage increases. But it marshaled still another argument on its side. When he took office fortnight ago, Prentiss Brown had admitted that the cost of living might continue to rise one-half of 1% a month. Labor seized on this admission, coupled it with the fact that living costs have risen about 4% since May 1942--the date when the War Labor Board's Little Steel formula, allowing for 15% wage increases, was put into effect. From half a dozen points came clamor for wage boosts: > Before WLB are demands by 200,000 West Coast aircraft workers and 64,000 meat packers for wage increases. > Railroad employes, numbering more than 1,000,000, are seeking increases up to 30% an hour.

> In Manhattan, 32,000 A.F. of L. dressmakers struck for two days, returned to work when WLB agreed to hear the demand of 85,000 garment workers for an increase.

> Getting set for a meeting this week of the C.I.O. executive board, at which pay boosts will be asked, United Auto Workers President R. J. Thomas cried: "The Little Steel formula has never been a fair means of deciding what are proper wage increases." He demanded a 30% raise. > Growled John L. Lewis: "In March the coal industry wage negotiations will begin. . . . The men who mine the nation's coal will ask for bread. They will hope that a government bureaucrat will not hand them a stone." Mr. Lewis' bread: $2 a day increase for 450,000 bituminous miners.

Administration Strategy? The plain facts are that weekly and even hourly factory wages have risen faster than the cost of living. But such are the twin pressures on the Administration--which failed to face the inflation problem squarely in the early days of the war--that reasonable arguments have lost much of their force. The arguments now boil down to a simple demand: if "they" get something, "we" want something.

Said one high Administration spokesman: "If we let one group of prices go up, and the farm bloc wants them all to go up, we've got to let all of them go. You can't hold them. When we do that, there isn't a way in God's world that we can keep John Lewis and Phil Murray from coming in for more wages and getting them. It will kick right back on the farmer in the shape of more costs for labor and machinery. He won't have a thing more when it's all over. But we'll all have been on a hell of a merry-go-round."

Administration strategy boiled down to three points: 1) attempt to appease the farmers with incentive payments, or subsidies, for greater production--a plan which the farm bloc has already turned down; 2) veto any bill to include farm labor costs in the parity formula; 3) hold tight to the Little Steel formula.

It will be a terrible and sweating job, and the major portion of it will fall in the lap of James Francis Byrnes. In the coming months he will need all his powers of persuasion, negotiation and compromise.

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