Full Speed Ahead

For the first time in more than two years, the U.S. economy is entirely free of wage and price controls. As President Eisenhower last week struck off the last controls--on machine tools, steel, chemicals and other basic commodities freedom brought only a few price boosts. There was a $4-a-ton hike in sulphur and a 4-c--a-lb. hike in coffee.* But, in general, businessmen showed no desire to gouge each other or the consumer for that matter. Actually, with production so high in most raw materials, there was little opportunity.

Even where metals were in short supply e.g., aluminum, producers made no attempt to raise prices. Their great (127%) expansion, launched since Korea, made them fearful of a glut if their prices got out of line. Though U.S. Steel and other big producers said there would be no general increase, some steel prices, such as stainless steel, went up. Mindful, however, of the public outcry stirred up by their unannounced price rise of five years ago (TIME, March 15, 1948), the steelmakers showed no signs of raising the basic price of steel ingots, a bellwether for the whole price level. Steel production soared to a record rate of 119 million tons a year, which would help hold prices down.

As for business itself, it was not only booming, but promised to stay that way. Many a prophet who had predicted that business would slip after midyear changed his mind, now saw a good second half. A touch of spring in the air gave retail sales a push to an estimated 3% to 7% higher than a year ago. The SEC estimated that, on the basis of a new survey, business expansion in 1953 would exceed the record $26.5 billion spent last year. And the Federal Reserve Board's latest survey of consumers' spending plans indicated that U.S. customers this year plan to outspend 1952 on autos, electrical appliances and houses. Thus encouraged, and with plenty of steel, automakers boosted their week's production to 168,288 cars, the highest in two years. As far as anyone could see, the watchword for the free economy was full speed ahead.

* Quick to capitalize on higher-priced coffee were U.S. tea importers, who announced: "A cup of tea made in homes costs an average of one-third as much as a cup of coffee."

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