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6/ BDARD DF GOVERNORS * £ 2 £L ±. or THE FEDERAL RESERVE SYSTEM Office Correspondence To wrx fo\HPTTF^JPer Date—,^1,19/,/, Subject: Mr. Carpenter At the meeting of the Board yesterday at which you were present, unanimous approval was given to a motion that the Board approve the making of the study by the Board and the Reserve Banks on postwar economic policies with the understanding that the stucty- would be a project wholly within the Federal Reserve System in which a l l of the Federal Reserve Banks would participate, that no publicity would be given to the project or any of the results of the study until the Board had determined what i t s policy should be in that connection, and that a decision with respect to release or publication of a l l or any part of the study would be made only at a meeting at which a l l of the members of the Board were in attendance. S, R, C, C May 31, To: Board of Governors From: Mr. Goldenweiser Subject: Reports by System economists on postwar economic policies This is a progress report on steps taken to organize the preparation of reports on postwar economic policies by members of the research staffs of the Board and tho Federal Resorvo Banks. What we propose to do is to got the bost judgment of specialists in the employ of the Federal Reserve System on desirable policies to be adopted after tho war in the different fields with which they are familiar. I wish at this time to ask for Board approval of the general project so that I may have the assurance that the Board is in sympathy with the undertaking and will stand buck of me in connection with such problems as may arise particularly in connection with the assignments of subjects to research men at the Federal Reserve Banks* You may recall that the origin of this study of postwar policies was a request by Chairman Eccles, at a meeting of the Open Market Committee in March, that tho economists who on that occasion had outlined a number of probloms, proceed further and provide the System with solutions of these problems. At tho meeting of the Opon Market Committee on Hay I4. I presented a program of postwar economic policies covering every phase that I could think of, I had arranged the program under fifteen general heads. This was a very hasty statement and it gave quite definite answers to all the questions, with the understanding on my part that that was preliminary and c was thrown out only for purposes of discussion. Later, at Allan Sproul's request, I enumerated these points at the conference of Chairmen of the Federal Reserve Banks, and I also gave them in substance to the Federal Advisory Council. Later s t i l l these questions wore changed into topics without definite commitments. At the meeting we had in Minneapolis of the System Research Advisory Committee the subject was discussed and specific assignments with a time schedule were prepared, A copy of these assignments is attached. I t has become generally understood in tho System that monetary and crodit policy cannot bo conducted satisfactorily without an understanding of tho entire economic picture. Consequently, the System has on i t s payroll specialists in nearly overy economic field, Tfhat i t i s pro- posed to do now i s not to undertake any now research, but merely to ask tho specialists to make reports of thoir judgment on the basis of such study as they have given the subject in recent years, When a l l of these reports have been received and edited they will together constitute a postwar program which will be available to the Board and the Banks, Yflrat other use will be made of this document and whether i t will ever be considered for publication need not bo discussed at this time, I bolicve that the banks will be glad to cooperate* if they understand the basis on which i t i s boing done. I t i s my own judgment that the fact that wo hav© undertaken an ambitious and broad program has already helped the morale of tho research staffs and has elicited a good doal of enthusiasm. Nothing stimulates economic thinking as much as the feeling that practical recommendations aro wanted. It is my purpose to proceed with the preparation of these documents and to have thorn ready some time this autumn or early winter. If for any reason the Board is not in favor of the proposal, I should like to stop i t before proceeding further in making specific assignments. On the othor hand, if the Board approves I want to send out the assignments promptly and also write to the presidents of the Banks asking their support for the staff members in their bank who \vill bo giving tirw to this matter. $. Q. i o POSTWAR ECONOMIC PROBLEMS AND POLICIES Subject Proposed Author Proposed Completion Date 1. Introduction and summary General appraisal of problems and proposed policies E. A. Goldenweiser (Board) 2. Gross national output Volume required for full employment Everett Hagen (Board) August 31 3. Distribution of output with reference to markets and living standards Frank Garfield (Board) August 31 U» International trade, monetary and financial policies Walter Gardner (Board) Woodiief Thomas (Board) John Williams (New York) September 31 5. Price developments and price policies a. Price controls and rationing in the transition period b. Prices, costs, and the incidence of increasing productivity c. Regulation of monopoly, trade restrictions, and other rigidities Clarence Tow (Kansas City) July 31 Clayton Gehman (Board) August 31 Howard Ellis (Board) Augu st 31 6. Labor developments and labor policies Wages, hours, and working conditions; labor costs; demobilization and readaptation problems; collective bargaining Government policy toward maintenance of employment Kenneth Williams (Board) August 31 7. Agricultural developments and policies Committee on Agriculture Arthur Bunce (Board), Chairman Phil Eckert (Cleveland) Walter Garver (Chicago) Franklin Parsons (Minneapolis) Earle Rauber (Atlanta) August 31 o POSTWAR ECONOMIC PROBLEMS AND POLICIES (Continued) Subject Proposed Author Proposed Completion Date 0. Social security Minimum standards and cyclical significance To be assigned 9. Public services and public works Health, education, recreation, and similar services; urban rehabilitation, highways, con servation, and similar public works To be assigned 10. State and local fiscal problems Expenditures and taxation; inter-governmental relationships (Federal, state, and local) in these and in public services and public works Committee on State and Local Finance George Mitchell (Chicago), Chairman Lloyd Raisty (Atlanta) Oscar Litterer (Minneacolis) August 31 11, Federal budget and taxation Richard Musgr&ve (Board) George Mitchell (Chicago) Oscar Litterer (Minneapolis) August 15 12. Management of the public debt L. M. Piser (Bourd) D. 11, Kennedy (Board) II. V. Roelse (Hew York) August 15 13• Business finance a. Financing industrial reconversion b. Peacetime financing needs Committee on Financial Aspects of Reconversion Art hur Upg r en (Mizineapo 1 i s ), Cha irman Kenneth MacKenzie (Cleveland) Waiter Koadley (Chicago) James Dolley (Dallas) Susan S. Burr (Board) Frederick Dirks (Board) August 31 Ernest Hopkins (Atlanta) Susan S. Burr (Board) August 31 c % Lon^-tinie needs of small business POSTWAR ECONOMIC PROBLEMS AND POLICIES (Continued) Proposed Author Subject Proposed Completion Date 11+. Commercial banking after the war Committee on Banking and Credit Policy C. A.Sienkieivicz (Philadelphia), Chairman E. A. Kincaid (Richmond) Arthur Upgren (Minneapolis) Morgan Rice (Dallas) Henry Sdmi st on (St. Lou is) Woodlief Thomas (Board) D. ivl. Kennedy (Board) Roland Robinson (Board) September 30 15. Interest rates John Langum (Chicago) August $1 16. Selective credit controls Carl Parry (Board) C. 0. Hardy (Kansas City) August 31 17. Postwar role of central banking Karl 3opp (Philadelphia) Roland Robinson (Board) William Tongue (Chicago) October 15 June 6, o Q
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