American Inflation
• It is generally recognised that British policies of full employment and trade expansion can be upset by economic disturbances originat- ing in America. The danger is not so much of an immediate slump in the United States- as of an inflationary boom there, leading to a crash in a few years' time. What is not sufficiently realised here is that rising prices in the United States would not at the present juncture be an unmitigated curse to the British economy. It is true that it would reduce the amount of goods which the loan will buy. But at the same time British exporters might dc very well by selling at good prices in the American market. Just which way the balance of advantage and disadvantage would tip in the newt two or three years is doubtful, but it could well be in favour of this country. After that disaster might come at any time. The savaging which the Price Control Act has received in the American Congress before being grudgingly renewed for one year increases the chances of a runaway rise in prices and an ultimate slump. The incredible irresponsibility with which the House of Representatives and the Senate vied with each other in limiting the powers of the Office of Price Administration bodes no good for the United States or for the world. The function of fixing maximum prices for foods and other agricultural prOducts has been transferred to the Secretary of Agriculture ; the O.P.A. is deprived of the power to control prices unless they exceed those of October, 1941, plus the average increase since that date ; and wide rights of appeal against O.P.A. rulings have been granted to industry. was only with difficulty that,' a proposal was scotched which would have lifted price controls from meat, poultry, eggs and dairy produce, thus allowing American farmers to bid for wheat for animal feeding which other countries need for human beings. Mr. Truman made an ineffective attempt to intervene but he will probably have to accept the new Bill or abandon price control altogether. It is almost a matter of indiffer- ence which he does.
