Old Quarrel

A familiar New Deal attack on Business last week precipitated a quarrel over a familiar New Deal paradox. The attack: FTC told the Monopoly Committee that the basing-point price system makes the steel industry "a focal centre of monopolistic infection which, if not eradicated, miy well cause the death of free capitalistic industry in the U. S." The paradox: The Administration's dual attitude toward Business--olive branch in one hand, big stick in the other.

That paradox began with NRA, which was almost a perfect expression of monopolistic economics. When it was abolished, the New Deal reversed its field, has since been on an anti-trust rampage. But a large group of New Dealers (such as Economist Leon Henderson) have continued to favor the NRA approach. With creation of the "business appeasement" policy, they have begun to emerge from the New Deal doghouse, to the alarm of more left-wing New Dealers (such as Lawyers Tommy Corcoran and Ben Cohen, Economist David Cushman Coyle). Last week's blast against steel was meant to chase the NRA advocates back into the doghouse for good. Instead it caused considerable barking.

Leon Henderson, a former NRA official, made a hurt defense of it. SECommissioner Jerome Frank explored "the question whether competition does not also at times lead to great economic and social waste," then suggested: "that the category of those industries which today we call public utilities, the category of industries where monopoly may be more desirable than competition, is not necessarily a closed one."

This file is automatically generated by a robot program, so reader's discretion is required.