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February 28, I9I46. Dear Pauls The newspapers, f o r reasons that only they oan account f o r , misrepresented my testimony b e f o r e the House Banking and Currency Committee on l a s t Monday by t r y i n g t o make i t appear t h a t the observation I made i n answer t o a question by Wright Patman as t o the expected r i s e in the c o s t of l i v i n g made an issue as between mys e l f and OPA- So t h a t the matter may be d e a r , I wanted t o c a l l your a t t e n t i o n t o what was a c t u a l l y s a i d . Ity exact words as taksn down by the stenographer were: " W e l l , of course, t h e r e i s a good deal of argument as t o « h a t our i n f l a t i o n has been. Measured by the increase i n the c o s t o f l i v i n g , I think the O f f i c e of P r i c e Administration f i g u r e s that i t i s about 30 per cent i n f l a t e d . Which i s as good a j o b as any country has done. I think maybe Canada has done, i f anything, a l i t t l e b e t t e r j o b than we have. But with o t h e r c o u n t r i e s , there has been a g r e a t e r i n f l a t i o n than t h a t . I would expect that with increased wages and p r i o e s on your new wage-price p o l i c y , t h a t we w i l l g e t some f u r t h e r i n crease. I t i s estimated that t h e r e i s a p o s s i b i l i t y of i t reaching as high as a maximum of ¿4O per c e n t . I would think, i f the c o s t o f l i v i n g can be held t o I4D per cent above the prewar l e v e l , t h a t we w i l l have done a f a i r l y good job cons i d e r i n g the s i s e o f t h i s public f i n a n c i n g t h a t has been undertaken." Using the 53 P * r cent f i g u r e whioh seems t o be the most a u t h o r i t a t i v e measure o f the degree of i n f l a t i o n so f a r , there would be a r i s e o f 7 per cent i f the I4O per cent top whioh I rather t e n t a t i v e l y suggested i s i n f a c t reached. I think Chester Bowles estimated t h a t the r i s e might be 5 p e r cent as against my guess o f 7 p e r c e n t , so that the d i f f e r e n c e between us would be 2 per cent a t the most. And, o f course, I was not making any production but merely saying that t h e r e i s a p o s s i b i l i t y of i t s reaching a high o f LtO per c e n t , but t h a t i f i t did we would have done a p r e t t y good Job, a l l things oonsidered. The matter may not be o f g r e a t moment, but I d i d n ' t « a n t t o l e a v e any doubt in your mind as t o what the aotual f a c t s were. C e r t a i n l y there i s no issue except as the press t r i e s t o ooncoot one. With b e s t regards. S i n c e r e l y yours. The Honorable Paul A* P o r t e r , Admini s t r a t o r , O f f i c e o f P r i o e Administration, Washington 25» D. C.
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