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December 10, 1942

Hon. Marriner S. Eccles
Chairman, Board of Governors of the
Federal Reserve System
Washington, D. C.
My dear Mr. Eccles:
Here is a document which I have prepared as a possible
pamphlet in the Board's postwar series.

I should deeply

appreciate it if you would read it over and give me your
reactions, verbally or in writing as you may prefer. You
will see that it deals with a big problem.

Please treat

it as confidential.
Sinc/fely yours.

lph f, WaflSciri
Assistant Director

December 23, 19h2.

Mr. 2alph J. Watkins,
Assistant Director,
Rational Resources Planning Board,
Washington, D. C.
Dear Mr. Watkins:
As Mr. Booles is making a hurried trip to Utah to spend
Christmas with his family, he turned over to me your letter of December 10 together with the confidential draft of your proposed
pamphlet on "The Framework of an Economy of Plenty", After reading it, I passed it along to Dr. Goldenweiser and his staff. Tour
statement of the general picture seems to us to be a correct one.
Because of the heavy demands on the time of the economic staff these
days, it is difficult to undertake any minute reading or criticism,
but it seems to me that the document does not call for it.
My own feeling frankly is that what is needed to overcome
opposition and prejudice, to say nothing of ignorance, is a simple
explanation not merely of what can be accomplished in the way of
full production and employment by a capitalistic democracy which is
prepared to supplement private employment with public employment
where and when necessary, but how it can be accomplished. I have
had some correspondence, for instance, with Stuart Chase who has
ably presented the potentialities without giving the working meehanism* of it, the financing, etc. In other words, what you continually encounter is the question, "How can we afford it?*, or the
statement that it all involves a continued rise in the public debt
until the end is "bankruptcy". Seldom have I seen an understandable
explanation of how the Government, through proper tax and fiscal
policy, can contribute to the maintenance of full production and employment without constantly rising debt and, in fact, without oreating an inflationary volume of money.
However, this is a booklet by itself and pamphlets such as
yours help to lay the groundwork. I do feel strongly that the time
is overripe for laying some of the ghosts of so-called orthodoxy that
haunt this picture but can and should be banished.
Sincerely yours,


Elliott Thurston,
Special Assistant
to the Chairman.


FEB 27
Mr. Elliott Thurston
Special Assistant to the Chairman
Board of Governors of the Federal Reserve System
Washington, D. C.
Bear Mr. Thurston:
I hope you will pardon me for this long delay in
thanking you for your critical comments on that exhortatory document which I sent Mr. Secies last December. Because of a loan assignment at the War Department, which
had me on a night and day schedule for some weeks, and an
extensive trip out of town, I have simply had to neglect
my correspondence. Please be assured, however, of my high
appreciation of your comments. They will be helpful to me.
Since I plan to make drastic revisions in this document and therefore do not want to have any copies of the
present draft floating about, I shall appreciate it if you
will return to me the copy I sent Mr. Eccles.

Sincerely yours,



March 1, 19U3-

Mr. Balph J. Watkins,
Assistant Director,
National Resources Planning Board,
Washington, D. C
Bear Mr. Watkins s
In accordance with your l e t t e r of
February 27, I a® returning herewith the
copy of your draft on "The Framework of an
Economy of Plenty"•
If you find time with a l l your
added duties to revise i t , I should be
interested to see the finished product.
I appreciate your cosracients on ray l e t t e r to
you of l a s t December 23*
Sincerely yours,

Blliott Thurston,
Special Assistant
to the Chairman.