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This is copy of a program submitted to the
President by Carrie, Henderson and Lubin in
conference with the President on November 8th,
1967.
Koveaber 8, 1937,
CAUSES OF THK
1.
Ifcs rsceBslon, in our opinion, i s directly traceable to an
in costs aad prices, which led to (a) » f l l l l w inventory*
j p g and
AMMHNI
Hwflwrtug sad (b) intwwdi <>*• • pnaAaiag 3*
al l a building* (See charts.
Hate p t r t i e a i a v l j «!*• w
t r i c e s disparity after «Tuiy, 1956.)
Purchasing
JK>W©T
in the l u l l of oonmrn^ra failod to
sufficiently to i i l O i l the a n l«V«l.l o^ v:uf?ia©sr ^ctiTity,
1)®-
JMnHtaNMH store <!oll&-r MklM MMffNrf no tMSnMMM tf%MP laffMOFy^ 1937,
despite monthly tnar>—!•• in retnil p r t w «
iHEtalsimst
MNMMII MMI
111 i t not been for
Toltase of r e t a i l trede wo^iltf karvt bi*Qn MtiJLM
tbere wae ao tftttNMMI utter
Hity in th« Monthly tttliai of nations!
incoiaa.
AWOB**
th© factors accounting for t h i s failure of national i a -
-eoiso to taMNMMM ^OTQ
1*
Ueolino i« butIding
in the fOVHnMIPMi^i Ef?t contribution* (B&e
chart.) for too f i r s t tine sine© 1930, the govanmont
i s now doNSttotin^ from buyto? pow&T M iroch M i t i«
4«
%ere i s ao 0QftYi&Gix\r ©vldonco thet the uudistr! uted
tax, t!i@ capital gains tax, or the Tarlous re^jlntory
of gov#ra^ent played any significant part in brisking about the decline*
In teportftRt gagaants of Industry, capital earp—tfitWX l s s t
was limited only by physical capacity of capital goods
coesp^nlss-*
^or the f i r s t nine HK5nths of 1937, aaw plant and
t; expend! iurea of minims and mmifeeturisg companies approxira&tad the* ioval of 19£8,
ID addition to the $4 billion Mi astda
annually fa* depreciation, •ftn-flJBKftelitl corpora tio;,s can retain 40$
of t h e i r MOMMvp *9f psflsjpfct or on tw&mgtQ un^is'ijibu'-.o nni'jji mti t t t
There la liii>l«future*
VHUMHI
|o expect a n3i^.turalw wtfmrn i n the
Th^ reetssfciaii caulo be Mrv«r« ttM |9MAm§Ml i f ftVanMM
does sot interfB»e.
Halthax «f tha t^;o forces corns.o.Mli it«t*4 as
factors, ?is, oorrMtloa of the inventory sitaatiax*. or
riMVtiflta or ter&bl« goo<3a MM INI AtpoMttfl upon for r a sumpx.ion of xecovery.
Bui doeli&c l l 35a?? (ptlwifm sK>ta@Bu^mf ana the
longer raaedial &c-iioa la illiTtt!, the LMM offseti^a Kill to xaoaaoires
of intervention*
K i r t W H^MVMMioai th«:.t follow m
iitttfifil f i r s t to
ate th« dealifta i n oonaiumr ^uylag a»3 lAtav h.2ip to brl&u
stibstantial iBcr««ss in ywlwnrtttg pow-^r,
jL» Crpy rrsaentRl puicuuaob.
I t l i W g g » i f 4 that tfeid i ^ t a
meixt plsee orders a t the e a r l i e s t possible 4*%m for *aoh m a t e r i a l s a
sapplies tts w i l l b© r*qs&x*d for the op«»r»tlo& of the
and ageacit»t» for the ratH-.iuder of the f i s c a l
-5-
£•
Aat^elpatlon of ®om® items of expenditurea.
The p o s s i b i l i t i e s
oliould be explored of transferring oortuia expenditures froa the
1939 budget to 1938.
Uote:
Keitfc**r (1) nor (i,) above would incre&se t o t a l gove-rft-
jaent eaeeerf&twes » f l the two yeet period.
I t 'ni r ht M H r e -
s u l t in savings.
izusressee i s req.u.ir«ao&td MT W.P.ii. t h i s
Winter should o ^ p y
«
Tor P.«.A. piojeotfl -hich Ma
v
wti isnddlately should be
J^» Priviate hQUiai.ja^«
She on*:; field on wljt^h rellajtte can be plea
for a syffioiesiu voltuao of sjq»eadllttree to Iwra the t!4e 4 i
stlimilatiori i s -'iTea, i s r e s i d e n t i a l b u i l d i n g
I t hM b««?n <3es»on-
stratod lOuDiy ti.ied 9 p a r t i culerly in the recession years 1921 and 1924,
ta*it buildinK construction can MPMi Vpmrd in tfeeftMM»of a (lovH?«or4
trend i n business e c t i T l t y . (Bee c h ^ r t . )
A bulldinr, prograti iau*t ee d^-yls^d, wliich, ftbeve e^afy otbor
©oralderation, provides houses Hud upertments on terms «bich art* taore
n thao. those pr^vsilis;;: on vsMeasures to Rwduce Bulliijiv^ Costa
One oi* ta© fundaiaontale for securing lov builuiHg costs i s attract*
ing large aeaie builders i n t o Ike f i e l d of housing.
possible lo^or builaing
fiaterial,
This would make
equipn&nt sal lsbor
JL« foilfligg gnterial cogta«
lap ri«SM indiestas that soltipl©
^ifc- romilts in Kltaga M M£h M 20$. This arises from sharing
of r e t a i l mar&ius i.M savings In ths feulfe iMttttittg o:' mi>.terinlB n l
Mnltlpla
tioa pf fcaU£lttg lalMNP awploymoB.t, UM) gXMlMHr aaBytsl laeojao.
In re-
turn ftar • -.sU3raiiv.;e<: tWHli laoonw, c('i",ne89iji;ji5 i n W^a ra*eo tire
£•
Fiaanco^ cliurr^-n.
Financial d
iv» as bttildiOf; oquijBildnt, matorlal and lut>or •©••••
0a October 1,
19r*6, HI inn I nil 1 bcudu in tight**! ^totc • Here obtaining 3?« Bad oTa
ox. t k s bulk o; ihoir iadivldnel reel e s t a t e loans.,
Thu Bs
tv© 3*®t** charged bj- l^ciarsl SnlXdiiig r-nf bMa i m i o t u t t o m
?^S i n 21 vtftttfl in Mijrch, I9M*
IWMI
•s.)rti:&ge3 m i l y PHMHlMi by
th© goTeriaaMit, ere y l ^ l d l ^ i l i t o x over 5 | $ •»<> wr# *betl«i borrowers
&£$+ [The bulk of BtgHtil s-i-nicleiiticl fca1Hl«g h i s been fam on
ncing OOftti con ba reduced by*
to J56.
B of |3l adtzTico charge OB Insured nortij of dpMl p^yiaeiit to 10$ on houses i n the
Adoption of tiie abo-ve proposals would have the srsiae offset «ie r e ducing construction costs by H &
I f the a e t r a t e t o borrowers
-5-
fcn-s tm% to 4&£t th« itrrfagi MfitM b© equivalent tt a deeiijae of
15#3$ in • — t t m i t l f costa.
If, in acidities.* actual
c a s t s wmld be Stt1 by 9V*B M HttX* ftfl 5^» tfci t o t a l KNril Of
quiring a n&it ha-,^ WO8X4 b^^ M#SMMril b;/ fyyiliMrtOily 8 0 ^
of tin r>erieKi of w^ort-lKation nssli also result in
SIM •>—Iiiit1tr>n of spttrtMntff oxk! f l a t i c^n be ttaricm
^-C
lij i t till oertein
Housing A#t«
Q3UU^MI4
t l y a d ; i>ra0«rite<!, in ^iJ.@ I
Eliffiinatio-. of the 1 l « r wtM puiiwlsw w&uld cut f
iBr? eosta bx D:J sriaujst oqut.l t o 6,1^S o:" the oo&etruetlMI co
In Ikia f i e l d , a ehi&f pronletc i s DM a i t r ; ctlfsu O
q
C«rt*ia aiaeofiRentR to the Federal HWMItim AH WW provide t h i s
i *.».
fi> I t
HAC
^|
9tti<9U.et« Ule pux-chasa of
s.
r M
txamptior Of %11 MTmifigtf up to #15,000, (Tbi? w o l i
of a l l •*ff9**tlO*Ui aafl would apply t o i s s s than 10^ of tiie
g of a l l eorporfttioj..©#)
b#
ifxeitptios ©f aftfilmgA is.
QJ;C©«>«
of #15tCKK> shall be applicable
to «uek MiHMti Mi ONi actually <axp&isd<*a> ffijr MBf 9OS«tratttOS of
pl.-s.nt and nqulpMSitt.
This sannption should w>t axooad 30^ of t o t a l
-6-
eanainga ana be applicable to actual expaaAitoum tfl exeesa of
to curruBi- BBBHd depreciation charges.
Further, this
be absolutely e-:>-.:dit-ioiisd upon iffiponlt.ior; of • penelty ifct* of
not usud Ito these st.-^tod pnrrjoses, sdiiek will in^ura their
Capj-tal ^alas t^3t» So^:it-s >l 1—1 iliiini to azpansiosii of
,£.•
aay IM provided by applying Iff* flat awrt— to capital f«lM up to
•50,000.
^.» few tazeo,
CDLEidsratlo^ of rev. taxes jsi^ht be 3«I&y<*d uutil next
«? when a olearor vlt^vr of fc)M IfliiflOi *inc FMPSBM |VMpMNtf will be
a.
Baj>itRC©d budget. The objective of a bol«nc#d Imigvt for 1959
should be retained.
Lsuchlla Curris
Leon Hen^ereos
Isedor Lubin
@FedFRASER