Cow Kicker

"I don't think there is a single sacred cow you haven't kicked," said Illinois' Democratic Senator Paul Douglas to Harvard Professor Sumner H. Slichter last week. Belligerent, grey-haired Economist Slichter's cow-kicking had thoroughly be-dazed Douglas' Joint Congressional Economic Committee at the start of its large-scale inquiry into how to achieve economic growth without inflation.

Committee Democrats squirmed at Slichter's blunt insistence that the main cause of present-day creeping inflation is labor-union pressure for wage increases. Republicans winced at his equally blunt plea for a $3 billion deficit in the fiscal year ahead to stimulate the economy and shrink unemployment. Trying to be helpful, Wisconsin's Democratic Congressman Henry S. Reuss said he was sure that Slichter did not really favor a deficit "as such." Retorted Slichter, touching off a burst of laughter: "I think I do."

Witness Slichter, 67, seemed almost affectionate toward price upcreep. "A slow rise in the price level is an inescapable cost of the maximum rate of growth," he said. The effects of slow inflation "are by no means as disastrous as they are frequently described." Like most other economists of the a-little-inflation-never-hurt-anybody school, he failed to make the distinction between the short-term direct effects of price upcreep and the much more serious longer-term psychological effects of accepting price upcreep as inevitable and tolerable (TIME, March 16).

What gave committee members the roughest jolt was Slichter's suggestion that the U.S. gradually abolish all tariffs and import quotas over the next ten years. Getting rid of protective tariffs, he said, would expose U.S. businesses to brisker competition, force them to become more efficient, more imaginative, more resistant to excessive wage demands. "No single step that the Government could take," said he, "would make such an important contribution toward strengthening the American economy."

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