For the Common Good

To any wary U.S. businessman who knows his friends and thinks he knows his enemies, Economist Leon Keyserling is one of the most fearsome curly wolves of the Fair Deal.

Businessmen recently had been receiving reassuring clucks from Commerce Secretary Charles Sawyer, but that might be expected of a man with Sawyer's business background. Last week none other than Leon Keyserling, for 17 years an avid New Dealer and Fair Dealer, looked up from a new study of business and announced a new "trend of thinking." The Government, said Keyserling, approves of businessmen; it loves them just as much, say, as it loves the farmers and organized labor.

Did the Administration really mean it? It was only a little more than a year ago that Harry Truman was demanding the scalps of "the Wall Street reactionaries . . . the gluttons of privilege." Since then, his Justice Department had hounded big corporations (see BUSINESS) ; he had threatened the steel industry with Government building if it refused to expand fast enough; and he had proven himself organized labor's man.

The new "trend of thinking" was set forth in a 38-page report to the President from his Council of Economic Advisers, signed by Keyserling as acting chairman, and by John D. Clark, the council's only other member since the resignation of conscientious, scholarly Dr. Edwin G. Nourse (TIME, Oct. 31). Translated from Keyserling's turgid prose and technical jargon, this is what it said the Truman Administration now believes:

P:U.S. business is not stagnant at all. It can carry the country to a national income level of $300 billion annually "within a very few years."

P:Higher production and higher national income are more important than trying to "redistribute" the wealth. (Traditional ways of redistributing the wealth were by heavily taxing some people, subsidizing others.) It is economic growth, better than anything else, which can create "a truly good standard of living for all."

P:No one, not even Washington, can determine exactly how the nation's wealth should be divided up. Capital must have incentive; profit is quite all right as long as it is a "reasonable" one and is used to increase production and employment. CJ The "longrun common good" is of primary importance--not just the "good of a particular economic class.

P:Cartels are bad, but there is a place in the U.S. for "well-conducted big business." The chief threat to little business is not so much big business as "big instabilities in the economy."

P:The Government is not primarily a cop. Its first job is to use its authority over fiscal, credit and monetary matters to help business, not smother it.

P:Controls are not the answer to basic economic problems. The answer lies in Government and business learning to understand one another. "Prices and wages and profits . . . should be left to the actions of managers and workers within our business system itself."

P:It is not true now and never was (no matter what some people thought in the '30's) that only Government action can pull the country out of a depression or rescue it from inflation. Taxation and public spending are only "useful weapons . . . Complete recovery from a substantial downswing depends primarily upon the revival of private investment."

The fact that the council's report also soared off into some sweeping theories about social security and deficit spending did not altogether spoil its conciliatory tone, or diminish its surprise factors. Most of Keyserling's words were sound and sane doctrine that many a businessman had long subscribed to. The wonder was its source.

What Keyserling wrote had to be put against what the President had to say in his messages to Congress this week. But at the very least it looked as if the Administration, however tardily, however motivated, had come to acknowledge one of the chief sources of the prosperity it was basking in.

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