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Copy of supplementary paragraphs,
supplied to a friend, >Jobn 6, Knox,
G o r m i t t i t Competition Branch o f
8*B«A* , now preparing a report cm
complaints regarding governmental
competition with business*
Lewis L. Baxter
Washington,D*G«
Hovember 15, 1934*
f o"'
There is no fundamental need for governmental Interference
with nor dictation to private business a c t i v i t i e s , with certain spec i f i c exceptions, nor f o r increased socialisation of productive a c t l vitles.
there i s mee4,of course, for public regulation of a l l busi-
ness that Is monopolistic i n nature, and production which, unrestrained,
night exhaust too rapidly such H a l t e d natural resources as petroleum
and coal*
fhe r e a l need, i n addition to s t r i c t l y governmental functions,
Is the socialisation of productive a b i l i t y otherwise wasted i n Idleness*
And such ever more important right and duty o f governs*ut Is beginning
t o receive the recognition i t merits*
Such function o f the agency which
represents society as a whole, and the {(eneral Interest, should not be
confused with governmmat, but rather regarded as necessary collectivism.
In addition to government*
B&rhaps some definite separation, such as
the creation of a non-political "National Board o f Public Works and Welfare", as free of short-range p o l i t i c a l control as the Supreme Court i t s e l f , would disabuse the p u b l i c mind o f the idea that the non-competitive
u t i l i s a t i o n of surplus labor i s synonoaous with governmental Interference
with private Industry*
Otherwise the costless *— may, more than costless, highly profitable
conversion of surplus lab*r into public services anl invest-
ments i s viewed en a parity with the, expense efgoversmentf
and as i n -
ceeaaing e f f i c i e n c y releases more aid more o f the labor-supply to produce i n the general interest» create ununited s p e c i f i c surpluses, o r
give us bread-lines and crime-waves, the awe-inspiring figures involved
i n financing the conversion of surplus productivity Into collectively*
acquired wealth create an erroneous impression o f mounting governmental
costs and extravagance*
•
\ i
/
Actually, the gain when surplus labor i s converted Into general
or ptibllo benefits i s three-fold*
F i r s t , there are the public works ant
services themselves — wealth In addition to a l l other currently-created
wealth, and income f o r the nation i n addition t o a l l other current income*
Second, there i s the additional production i n private industry to supply
the needs of the additional public employees}
whl& process returns the
t&JMfaxids t o t h e i r source, as such additional Industrial output is marketed*
And t h i r d , Is that even more important gpln that l a inevitable when the
deflationary effect of an unaasigned labor-surplus i s removed ttca the
national eoonosy#
While such fact i s just beginning to be unierstood, wo*
employment i s supply i n exoese o f demand on a general basis) and the eco~
p e t i t i o n o f too aany would-be workers f o r too few available jobs deflates
personal earning power throughout the nation thus a f f l i c t e d , just as def i n i t e l y as too much wheat or too Batch cotton impairs the t o t a l value o f
the entire attgpl? of such ( p a c i f i c cocs»&itlee.
£
economic securitx associates
Q
U&9 l a r k C i t y
P
Tt
October BO* 195&#
S* Beclee*
fre&sury Bep&rfca^t*
W^hington*
C*
Be&r Sr* Boolesi
Shis
flE ?
Hew lork Tt&es c&rries a iYoatHP&g* rsJLe&se headed
^tp^g^OQippp,,^, f H B » r Boyks,,
In one way t i d e I s gmtifyiag* I n anoth&r i t i s ^ust the reverse*
agr mlad I t i s not only a swious blunder t o thick of recovery speeding i n terms of totals* instead of rate, but a s t i l l more serious on* t o
uufteeess&rily alarm tho reactionaries with tho thought of snother huge
addition t o our present aleM&ng item of public debt*
Personally % m Qomlm&&§ and t believe you w i l l agree* that the
o r i g i n a l $S*SQG*QOO*OQ0 f o r public works would have proved adequate* had
the
factor been w d « the primary consideration* Instead* according
to a Bath Finney a r t i c l e i n yesterday*©
$i*QS6*4S6*6M
h&s been actually been gpent by p* W*
i n the sixteen aonths since the
appropriation m n voted* <Efa&t
the ©Epeaditor* o f the
$5*300*000*000 w m aperiod of approximtely £iv$ years*
Once ia«re t am goiag t o t r y t o emphasise the urgency o f this *e&les
campaign* — s e l l i n g Congress and the nation the iratih that i t might be
enommsly profitable* rather than costly* t o bay the labor surplus cori*
tinuously and i n i t s entirety
being conducted I n a o^refnUy^latmed
manner* Premature rgle&ses o f the above character do laore ham than
good* the f i r s t step should be to get tho heads of the various govern*
t&mt&l agencies together on the general principle* then each release
should be proiMsrly t i s e d end worded* so that the public w&s educated t o
understand* ste^ by at#p*
Que very general complaint regarding tho whole Sew Deal program i s
the f&ot th&t t o the unenlightened public there i s no understandable basic
plan t o i t * Xt seems only a hodge-podge o f opportunity u n r e l a t e d aoves
ill-coneeived and poorly executed* Sow* I f the r e a l need i s f i n a l l y beginning t o be understood* i t &mm a p i t y f o r the ohimoes of coarploto success
to be impaired by improper
psychology
or none a t a l l *
Uhis i s what has been back o f ay suggestions t o you* that X should
have a seat down there* so&awhere on the s i d e l i n e s * and a hand i n the
press-^gent work that I s so important end could be so valuable i f performed
i n an uuderetcmdiag wanner* Pieoe by piece t h i s thesis o f oostle&rly
baying the o t h e r w i s e ^ e t r i ^ n t a l labor surplus i n useful fera* * i t h extra
a n S B Oct* 80, *54#
current incoae* otherwise nev&r risceived* could bo fed out* u n t i l evwy
» ebop-keeper a M f&riaer would understand i t * X never have
the slightest trouble i n convincing m& after man of the soundness of the
b&sic concent* X believe I &&
well qualified m any one to ©all I t
to
for the
Of one fact X
oonvlmjed* Mr* Boos^mlt hl&**elf
not see the
po&aihlHty* So hisa the e&tra public s p r i n g l a a necessary cost) and
cre&tor of debt* 81a Bo&mfea speech indicates that cle&rly* Consequently
there I s that ton&sney to hedge and holdfc&ci:*t^ich Is p i l i n g up debt a t
oi&y a s l i g h t l y slower
and far & vastly longer time than I* necessary*
To date i t ba^ never occurred to hist tluit the e&tir* adequate tcge b i l l might
be p&tdf on a
basis* or &
^>prcesijaatioti of i t , with s&»
d i t i o n a l production that i e now w t taking place* the result
do real
increase i n income* and the fear that ts3dng a«jr larger percentage of i t as
current taxation would be tssgjossihle* Hence the s t r i n g need for borrowing
infinitely*
Ib&t i e
that o$mot conttm* mob longer* th* increase i n
pu&Iio debt frsm $10*000*000*000 to #£3*CK3O*£&O*OG0 already (partly* of course*
under Hoover) i s at the bottom of tr* Haoeovolt1^ waning po^or and p o l a r i t y *
Lat the Idea of & further l&aro&m to #40*000*000*000 get into circulation*
and a t i d a l wave of protest 10 l i k e l y to weep over the country and impair
hie power to a point tfimw his hands are tied*
BonH think X am depreciating em1 splendid President* Instead* X re*
gsrd him
a
Be Is hoaor I t s e l f * He i s absolutely altruistic*
Be has the courage to defy a l l pernicious iniluanc&s*
the time being
he h&s the powsr* But i f he m i t s too long* he may not have It* Y m and X
may not l i v e to see such another In the White House, ffia ppq^t ^ f&j^S
And i f he* and hie ntnaerauji advisers could only be brought together m
the one possible successful
hie
would go down i n history as our
greatest President*
Do you know Harry Hopkins pratty wall? Be Is h i t t i n g e l l strtnmd the
truth* but thin
plan11 shows he h&snH quite got i t yet* X wish
you could fix thing® so X could have an earnest t&lfc with him* Be i s i n a
marvelous position to be tho Sosee*
Very sincerely*
/V
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