Unkickable Habit

Once having savored the heady pleasures of advising the White House on how to manage the country's economy, can an economist ever kick the habit? The answer, as supplied by Henry C. Wallich, 47, who served two years on President Eisenhower's Council of Economic Advisers, seems to be no--at any rate, not so long as the nation's press gives him a sounding board.

Although he is back on his job as professor of economics at Yale, the loss of portfolio has rendered Retired Presidential Adviser Wallich anything but mute. He regularly writes editorials on economics for the Washington Post, has articles in three current highbrow magazines: Harper's, the American Scholar, and the Yale Review. In all three, Economist Wallich hopefully beams his message at a particular reader--President John F. Kennedy. Items:

sb In Harpers, Wallich locks horns with one of Kennedy's top economists, John Kenneth (The Affluent Society) Galbraith. Along with the rest of the Kennedy "Brain Trust," says Wallich, Galbraith "rejects our ancient American folklore that politicians spend too much. In its place he puts the intriguing notion that they spend too little. Public needs are underfinanced, while private tastes are overindulged." Wallich does not agree that the public addiction to chrome, tail fins, and other ostentatious foolishness means that it cannot be trusted to fill its own needs: "It is something of a non-sequitur to conclude that the only alternative to foolish private spending is public spending. Better private spending is just as much of a possibility." Wallich's article is not only loaded: it is often squarely on target, e.g., "Old federal programs never die, they don't even fade away--they just go on."

sb In the Yale Review, writing for its 50th anniversary issue (TIME, Oct. 13), Wallich compares the "innocence" of the national economy 50 years ago with its current complexities, decides that the marketplace, for all its flaws, is still impressively viable. The U.S. economy, says Wallich, has stayed healthy not so much because of Government intervention but in spite of it: "The gamut of possible government action has been widened, the box of tools greatly enlarged, and there are many who would like to use the lot. Such drastic departures are not a normal part of the American scene. It would take a major disaster to precipitate action on that scale."

sb In the American Scholar, Economist Wallich considers a major disaster: the cold war. Russia's forced-draft economy, says Wallich, is clearly a better production design for war of any temperature--a fact tacitly admitted by the U.S. during World War II, when the free national economy was pressed into Government service, with remarkable success. But Wallich sees no need for such a remedy now: "The United States has been the land both of freedom and of money. Today we are being successfully challenged in the second department. We no longer possess an exclusively successful system for the creation of wealth. Our best course is to remind ourselves of the original primacy of the first, of freedom. If we can re-establish the United States, in our own mind and that of others, as the land of freedom, we shall have assumed a posture that the other side cannot copy. It gave the United States an overwhelming attraction once. Perhaps it can do it again."

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