Experiments in Price Control

Report Outline
Administration's Concern Over Rising Prices
Price Changes in Depression and Recovery
Experiments in Direct Control of Prices
Curbing of High Prices by Indirect Means
Special Focus

Administration's Concern Over Rising Prices

Administration fears that sound recovery was being threatened by rapidly rising prices were given forcible expression April 2, when President Roosevelt declared that prices of steel, copper, and other basic commodities had gone too high, and that the government would seek to check the movement by curtailing its purchases of durable goods. Similar warnings against inflationary price increases in general had been uttered a fortnight earlier by three other prominent administration members. Marriner S. Eccles, chairman of the Federal Reserve Board of Governors, in a statement March 15 urged “vigorous government intervention with all the powers at its command to deal directly with the causes that might endanger the progress of a stable and enduring recovery.” On March 17 Secretary of Agriculture Wallace conceded that “all of us are afraid of a repetition of the 1929 boom.” He implied that the administration might seek new powers to avert such a development. Secretary of Commerce Roper on the same day spoke of “danger signals,” including unjustified price increases, and cautioned against “unguarded business booms.”

On April 26 the President supplemented his price statement with a warning to government employees to refrain from speculation in stocks, bonds, or commodities. The next day, in a letter to Vice President Garner, he asked that Congress postpone action on the Tydings-Miller resale price-maintenance bill, saying:

The present hazard of undue advances in prices, with a resultant rise in the cost of living, makes it most untimely to legalize any competitive or marketing practice calculated to facilitate increases in the cost of numerous and important articles which American householders, and consumers generally, buy.