"Inflation by Publication"

At a retailers' convention in Manhattan last week, Botany Mills' President Charles F. H. Johnson stood up and asked: "How can anyone gauge or predict market trends without knowing what bewildering statements will be issued?" On four different occasions, said Johnson, Government spokesmen, by sounding off on Government buying plans which failed to develop, had sent wool prices soaring. Cried Johnson: "Here is a perfect example of inflation by publication."

Off Again, On Again. Washington abounded in inflation by publication last week. Roly-poly Price Administrator Mike DiSalle dropped his plan for a 30-day price freeze after his boss, Stabilization Director Alan Valentine, vetoed it for lack of an enforcement staff.

"We have come to the definite conclusion," said Valentine at a press conference, "that we do not plan on price action across the board, a general freeze, ceiling, or stabilization of prices."

Two hours later, with Valentine not around, DiSalle began popping off on new plans. With his 30-day order dead, DiSalle was fighting for full mandatory controls in 60 days. He intended to take his fight for a freeze right up to the President.

Then Harry Truman compounded the confusion. Only a week before, the President had complained that food prices could not be controlled under the present law if they were below parity. Now Harry Truman snapped that parity had nothing to do with it, and added that wholesale prices of farm products had risen very little since June. The fact: they had risen 13%, about three times as much as industrial prices. Harry Truman added: controls on both prices & wages are coming as quickly as possible.

Gone Again. Cyrus S. Ching's nine-man Wage Stabilization Board, which is also under Valentine, was making no more progress toward stabilization than DiSalle. The C.I.O.'s Philip Murray and A.F.L. leaders warned Ching that they would not deal with his board until it was free of control by Valentine and until Ching had power to act on his own. Furthermore, they were willing to talk wage controls only after prices had been fully stabilized.

Then John L. Lewis appeared before the board. "Why do we need to freeze prices now, and why freeze wages now?" he demanded. The U.S., said Lewis, could devote 25% of its capacity to rearmament and "do that job in its stride. Our capacity is 50% greater than in 1939 and we haven't used it at all, even now . . . Why can't our country go forward and produce this 25% without the necessity of putting our economy in irons? What do we want? More steel? We're getting it. More coal? We can have it . . . hundreds of mines are working only four days a week now . . . Why not let a free economy function?"

Before the stepped-up stockpiling program, before inflation by publication, and other price-hiking influences, John Lewis' free-enterprising words might have made sound economic sense. As events turned out, they were probably spoken too late.

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