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About Medford mail tribune. (Medford, Or.) 1909-1989 | View Entire Issue (Aug. 27, 1956)
TEN MEC FORD (OHEGOrT) MAIL TBIBUTTT Monday. Augul 27. 1SJ8 Fears of Many Over Economic Policy of Eisenhower Administration Now Quelled By A. ROBERT SMITH Mail Tribuna Correspondent (Editor's note: This is the first In series of articles analyzing the record of the Eisenhower ad ministration. It is based largely on a detailed analysis made by the New York Times, an inde pendent newspaper.) Washington When Presi dent Eisenhower led the first Republican administration In 20 years into of fice in Janu a r y, 1953 many Ameri cans with long memories o f the Great De pression which began in the Hoover admin istration were A. Bobt. bmiui plain scared- about their bread and butter, Today, near the close of the Eisenhower a d m 1 n i stration's four year term, most are scared no longer and they have more bread and butter. That says a great deal and symbolizes the single greatest triumph of the Eisenhower eco nomic policy. But it by no means says that all the key aims of that policy were achieved. The Eisenhower economic policy con tained these three principle aims: 1. Get the government out of business leave economic decis ion-making to managers of pri vate business, reducing the con trols of the federal government. 2. Balance the federal budget and cut taxes achieve this by reducing government spending and adopting tax laws designed to encourage private investment. 3. Maintain full employment without inflation use govern ment power to curb both boom and bust tendencies in the eco nomic cycle. Whenthe new GOP adminis tration came into office, it promptly frightened many by adopting the tightest credit squeeze since the 1920s, driving interest rates to their highest level In three decades. The Sen ate soon rang with dire predic tions from Democrats that "hard money" was going to ruin the country once again under Re publican leadership. Changes Adopted When the country nosed to ward a recession late that year, the administration adopted changes in its monetary eco nomic policy which proved to many that the president's fiscal advisors were as different from the "Wall Street crowd" of the 1920s as, say. Eisenhower Is dif ferent from Warren G. Harding. The changes were to switch to an "easy money policy which loosened credit through the Fed eral Reserve system, and to fore go any plan to balance the fed eral budget the first year, there by using the government to in ject more money into the econ omy than was being taken out by taxation. The fact that a Republican administration was willing to use deficit spending (the deficit that year was $4.2 billion) one of the bogeymen which Old Guard Republicans in congress had long attacked during the past Democratic administrations as sound economic policy un der the circumstances, indicated a new GOP attitude. As a result, the recession last ed six months, leveled off for four more months, and then the economy galloped into the great est boom in the country's his tory. The administration ended price and wage controls, using credit controls to keep a rein on inflation. Prices now are at a record high, but only about one per cent above their level when the administration took of fice. Otherwise, not much gov ernment intervention has been changed from the past, but the administration ha sought to re sist any new incursions into the business field. National Debt Increased Because it used deficit spend ing to knock the 1953 recession in the head, the budget re mained out of balance until this 1956 fiscal year. Thus the na tional debt has been increased instead of being reduced during the Eisenhower administration. Taxes were cut in 1954 first through a Democratic-sponsored excise tax reduction bill; then by a GOP bill which granted relief to stockholders and to business for depreciation and by other devices. This latter measure represented the major Republican drive to implement its election pledge to reform taxes to stimulate the economy. While it was attacked as illus trating the "trickle down" theory of granting relief to busi ness and letting it trickle down to the consumer and wage earn er, enactment of this tax meas ure has been followed by un precedented investment in new industrial plants and equip ment. The pledge to reduce govern ment spending was aided by the end of the Korean war, which permitted a reduction in the defense budget. But the admin istration has been unable to meet its pre-election goal of a $60 billion budget. In the past fiscal year, spending topped S66 bil lion. Spending for civilian func tions of the government has reached its highest level in his tory under this administration, and with a big new federal high way program about to start, it can go nowhere but upward Foreign aid shows no sign of declining, and defense spending is on the rise once more. On the whole, despite some relief for individuals and busi ness, taxes have not been cut nearly so much as the Eisenhow er administration hoped and ex pected when it took office. The basic reason is that it found it could not cut federal 'spending as much as expected; for run ning the U. S. government in the 1950s is just plain expensive. Subsidies Extended While this administration has not launched a broad program of public works to stimulate the economy into its present boom, it has nevertheless continued and extended federal subsidies of many sorts on a broad scale. It has: Used the method of stock piling strategic materials to prop up the price of many domestical ly produced metals, such as lead and zinc. Continued price sup ports on as many farm commod ities, although at lower levels, as was the case in 1952 under the Truman administration. Com mitted government subsidies of the most generous sort to start a record shipbuilding program for peacetime. And added new programs of government partici pation, such as aid to economic ally distressed, areas and fed eral flood insurance. It, also, had proposed federal aid to edu cation, but legislation to enact it was defeated in Congress. The major soft spot in the economy today is down on the farm where prices for agricul tural commodities have declined a benefit to urban consumers, but detrimental to rural grow ers. This will be covered in a subsequent article. On the whole, the Eisenhower administration has taken a prag matic approach to define and guide the role of government in the national economy. The re sult is an economy prosperous beyond all previous measure, but otherwise not much differ ent from the structure that many Republicans once thought was a Frankenstein monster. Big government not only proved tough to cut down, but rather useful Reserpine Now in Radioactive Form Chicago flJ.R) Argonne Na tional Laboratory announced to day it has produced reserpine, the new tranquilizing drug, in radio-active form. Argonne said the "hot" drug will be used in research at Co lumbia university, where scien tists hope to trace the drug's chemical pathways throughout the body. "It is expected that these studies will contribute import ant medical information on the use of this drug," the laboratory said. Reserpine is a derivitative of the rauwolfia plant, a small shrub with smooth leaves and snake-like roots. In India, it has been used for centuries for medi cinal purposes. In recent years the derivita tive has been used in the treat ment of mental and emotional disorders. The radioactive form of the drug was produced by growing the rauwolfia plant In an atmos phere containing radioactive (NEXT Attitude Toward Labor) carbon dioxide. Suspect in Chicago Slayings Cleared Oakland, Calif. (U.R) Two days of lie detector tests have cleared Norvel DeGrove, 42-year-old ex-convict, of any im plication in the murder of three Chicago boys last October. Local law officers and three Chicago policemen sent here to question DeGrove said they "agreed unanimously" that De Grove was telling the truth when he denied killing John Schuess ler, 13, his brother, Anton Jr , 11, and Robert Peterson, 14. Connected With Offenses However, they were convinced the tests connected DeGrove with two Midwest sex offenses. DeGrove, a nurseryman in Chicago at the time of the slay ings, was arrested by the FBI here Friday for unlawful flight to avoid prosecution on charges of raping an 8-year-old girl in Elmwood Park, III., Jan. 24, and kidnaping and molesting another 8-year-old girl in Angola, Ind., Mav 11. The former convict may also face charges here. Alameda County Sheriff H. P. Gleason said DeGrove has been identified by a 9-year-old boy as the man who molested him recently. DeGrove has been working in nearby San Leandro as a nur seryman under the name of Carl Newman. He was arrested Fri day when he went to a used car lot to complain about a car he recently bought. His employment here and in Illinois as a garden worker made him a major suspect in the slay ing of the three young boys. Traces of an insecticide used in nurseries were found in the scalp of the Peterson boy. Another effort is being made to make New York state's Thru way even safer than it now is. When fog, rain or bad road con ditions are prevalent, red signs will cover sections of the bad stretch of road, informing mo torists that their speed limit must be reduced to 35 mph. The normal speed limit is 60 mph. Siassen Returns To Disarmament Post Washington (U.R) Harold E. Stassen returned to his post as presidential disarmament ad viser today and refused to talk about his abortive flyer into vice presidential politics. Stassen took a four-week leave of absence July 30 to work full time at dumping Vice President Richard M. Nixon from the GOP ticket. He failed, and ended up seconding the nomination of the man he had wanted to bounce. Asked if he would do it all over again, Stassen said with smile, "I never speak of things gone by." Peter Lawford's Wife Gives Birth To Daughter Santa Monica, Calif. (U.R) Actor Peter Lawford'a wife. Patricia, was reported "doing fine" today after the birth of a daughter at St. John's hospital. Mrs. Lawford, daughter of for mer Ambassador Joseph P. Ken nedy, gave birth to a six-pound, nine-ounce daughter Saturday night. The couple also has a ton. 3 BIG FREE PARKING LOTS xr tttn rrx xttt rmn i T-m tt ,n sixth and grape streets Ramon Magsaysay, Puerto Rican Win Freedom Awards New York (U.R) President Ramon Hagsaysay of the Philip pines and Gov. Luis Munoz Marin of Puerto Rico are the winners of the 1956 Freedom House Awards, it was announced today. The announcement of the awards was made by Whitney North Seymour, Freedom House chairman of the board, and Dr. Harry D. Gideonse, president. President Magsaysay will re ceive the freedom award for "teaching his people how to use their newly gained freedom to develop their greatest potentiali ties, and demonstrating the-advantages of the democratic way of life in an area of the world sorely beset by the forces of dic tatorship," according to the cita tion. j Gov. Munoz will be given a Freedom House 15th anniver- , sary plaque because "under his guidance the people of a free commonwealth have demon strated the effectiveness of de mocracy in an underdeveloped country." The Puerto Rican gov ernor was cited for his "dynamic leadership and the creative tech niques which are in a great measure responsible for the ' striking progress of the Puerto j Rican people toward a better life." The awards will be made at the 15th 'annual dinner of Free dom House on Oct. 7. President Magsaysay will be represented by U.N. Ambassador Carlos P. Romulo of the Philippines. CAMMED TIME TO BUY... w - If You're Not Trading At The Groceteria You're Paying Too Much "f ' - ij' ' New Pack Del Monte G PEACHES HALVES OR SLICED CLIN Kraft American Cheese Spread 25 ' S oz. Jar Stoop. can make a world of difference to y" when they're yow can celled checks. Each one is proof of payment . . . phis a handy record of yow expendi tures. Open yow checking ae ccwiDt at U. S. 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