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February 12, 1951. Mr. Richard L. Strout, Christian Science Monitor, 1293 National Press Building, Washington, D. C. Dear Dick: Because, as Senator Robertson said when he put your article in the Congressional Record of February 8, you are one of the clearest aid most accurate reporters on fiscal affairs I wanted to straighten out a few misconceptions which appeared in your essay* f i r s t point is well brought out in the enclosed editorial from the Evening Star of February 7. The tremendous seriousness of this issue becomes obscured i f i t is dealt with in terms of a personal feud. Your article makes i t appear that I am ungratefully staying on the Board i n a vindictive spirit. I was not "politely reappointed" by Mr. Truman when my term expired. ^ tens, did not expire and will not expire until February 1, 1£?8 . tfy tens as Chairman expired and the President did not rename me Chairman which was, of course, entirely his privilege. I have always taken the position that the President should be perfectly free to have his own man as the Chairman. The reasons I stayed on have l i t t l e or nothing to do with what you term a "personal feud", or with interest rates, as such. As I have sought to make plain many times 1 don11 care what the interest rate is i f i t w i l l induce true investors to buy and hold Government securities. I f zero rate would cause them to do that then I would be for such a rate. The whole trouble today and virtually a l l of the inflation we have had this past year is not due to Goveraaent spending because the Government has taken i n more i n cash than i t has paid out. The inflation i s die to private deficit financing through the banking systflE, the creation of billions upon billions of new purchasing power superimposed upon record peacetime incoses, reinforced by a tremendous backlog of liquid assets. I have no bitterness whatsoever toward the President, contrary to the impression l e f t by your article. I think he has been badly misled by sosae of his close advisers. Mr. Richard L« Strout -2- That vote which you quote is also wrong. I m not at liberty to divulge a vote which took place i n an executive session but I aa free to say to you, for your om information, that there was no vote on any such issue as your article states and the only vote which was taken, which was on an entirely different issue, was not i n accord with the story as you printed i t * I strongly suspect that a certain individual with mischievous intentions circulated this false report. Having gotten this off my chest, l e t ae say that i t wouldn't have bothered me except for my long acquaintance with you and the quality of your mind and your works, year after year. Aside from the flaws above alluded to i t i s , as Senator Robertson points out, a good appraisal of the pros and cons i n general terms. I don't know whether you saw my recent statement before the Joint Committee on the Economic Report but anyway I am venturing to enclose a copy. Sincerely yours, M. S. Secies. Enclosures 2 P.S. You may also be interested in the enclosed editorial which appeared in the February 10, 1951, isrue of M.S.E.
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