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MONTHLY
REVIEW
F E D E R A L R E S E R V E B A N K OF A T LA N T A
APRIL 1970
R evenue S h a rin g : W h a t It M ig h t M e an
C on gress
is
now
s tu d y in g
an
A d m in is tr a tio n -
r e s u ltin g in a fis c a l m is m a tc h . S in c e m o s t F e d e r a l
s p o n s o r e d p r o p o s a l fo r s h a r in g F e d e r a l r e v e n u e s
revenues
w ith s t a t e a n d lo c a l g o v e r n m e n ts . T h is , h o w e v e r ,
su ch
is o n ly t h e m o s t r e c e n t o f s e v e r a l p r o p o s a ls fo r
te n d e n c y
s h a r in g F e d e r a l ta x r e v e n u e w ith s t a t e a n d lo c a l
fa ste r
g o v e r n m e n ts.
1 0 - p e r c e n t i n c r e a s e i n t h e n a t i o n ’s g r o s s n a t i o n a l
The
id e a
o r ig in a lly
cam e
to
th e
fo r e fr o n t in th e m id - s ix t ie s .1
T h is
a r tic le
p o in ts
d is c u s s e s
o u t, in
p r e se n ts
a
p r o p o s a ls
have
le d
te n ta tiv e
s h a r in g , if e n a c t e d
co n c e p ts
to th e m . In
a n a ly s is
in to
of
d e r iv e d
fr o m
p erson al
fo r F e d e r a l
ra te
th a n
th e r e
is
a
to
grow
at
a
e x a m p le ,
a
econ om y.
an
ta x es,
ta x ,
revenues
th e
g en era tes
p r o g r e s s iv e
in c o m e
For
e s tim a te d
1 5 -p e rcen t
in
and
c r e a s e in F e d e r a l p e r s o n a l in c o m e ta x c o lle c t io n s .
and
D e s p it e a n a v e r a g e c u t o f a b o u t
a d d itio n ,
how
are
th e
produ ct
th e se
g en era l term s, th e
tr e n d s w h ic h
as
it
revenue
la w , m ig h t a f f e c t s t a t e
a n d lo c a l g o v e r n m e n ts in s ix S o u th e a s te r n s ta te s .
15
p e r c e n t in
F e d e r a l ta x r a te s s in c e 1 9 6 1 , F e d e r a l t a x r e c e ip t s
g r e w f r o m 1 8 .4 p e r c e n t o f G N P
in
1 9 5 7 t o 1 8 .8
p e r c e n t i n 1 9 6 1 t o 1 9 .0 p e r c e n t i n 1 9 6 7 .
F e d e r a l e x p e n d itu r e s , o n t h e o th e r h a n d , h a v e
g row n a t a b o u t th e sa m e r a te a s th e ec o n o m y .
C o n c e p ts
F ederal
e x p e n d itu r e s ,
as
a
percent
of
GNP,
r e a c h e d a p o s t w a r h i g h o f 2 1 .1 p e r c e n t i n 1 9 5 3 ;
W h a t is r e v e n u e sh a r in g ? I s it a n e x t e n s io n o f
e x is tin g F e d e r a l a id p r o g r a m s, o r is it s o m e th in g
r e a lly
n ew ?
R evenue
s h a r in g
program s
in v o lv e
tw o e s s e n t ia l c h a r a c t e r is t ic s . F ir s t , a p o r t io n o f
F e d e r a l r e v e n u e s w o u ld b e tu r n e d
o v er to su b
n a tio n a l g o v e r n m e n ts fo r th e ir u s e . S e c o n d , th e r e
w o u ld b e n o r e s t r ic tio n o n t h e f in a l u s e o f t h e
fu n d s b y th e g o v e r n m e n ts. T h e
u s e d in
fu n d s c o u ld
be
a n y m a n n e r th e s e g o v e r n m e n ts c h o o se .
O b v io u s ly ,
th is
concept
d iffe r s
g r e a tly
fro m
t h e fa m ilia r e a r m a r k e d F e d e r a l g r a n t w h ic h m u s t
be
s p e n t fo r
m odern
a
tim e s ,
d is tr ib u te d
to
s p e c ific
F ederal
p ro ject
fu n d s
s u b n a tio n a l
or
p u rp o se.
have
n ever
g o v e r n m e n ts
In
been
fo r u n
r e s tr ic te d u s e . T h u s , r e v e n u e s h a r in g r e p r e s e n ts
a r e m a r k a b le c h a n g e in in te r g o v e r n m e n ta l f is c a l
i n 1 9 6 7 , t h e y s t o o d a t 2 0 .7 p e r c e n t . T h u s , u n l e s s
ta x e s a re c u t or e x p e n d itu r e s in c r e a s e d a t a m o r e
r a p id
r a te
ten d e n c y
r a p id ly
w ord s,
th a n
fo r
th a n
a
in
th e
F ederal
F ederal
F ederal
p a st,
th e re
r e c e ip t s
to
w ill
e x p e n d itu r e s .
“ fis c a l
be
grow
d iv id e n d ”
In
or
a
m ore
o th e r
s u r p lu s
te n d s to d e v e lo p .
S u b n a tio n a l g o v e r n m e n ts f a c e a d iffe r e n t s it u a
tio n . T h e n e e d
s e r v ic e s
and
fo r s t a t e
and
c o n s e q u e n tly
h a v e g ro w n m o r e r a p id ly
lo c a l
th e ir
th a n th e eco n o m y . In
1 9 5 0 , th e s e e x p e n d itu r e s a c c o u n te d
cen t of G N P . B y
governm ent
e x p e n d itu r e s
1967, th e y
had
fo r 9 .8 p e r
r is e n
to
1 3 .5
p e r c e n t a n d m ig h t h a v e b e e n h ig h e r if t h e y h a d
been
fin a n c e d .
O n th e o th e r h a n d , m o s t s t a t e a n d lo c a l g o v e r n -
r e la tio n s h ip s .
W hat
has
R e c e n tly ,
th e
p ro m p ted
d iffe r e n c e
t h is
p ro p o sed
b etw een
chan ge?
revenues
and
e x p e n d itu r e s a t v a r io u s le v e ls o f g o v e r n m e n t h a s
b e c o m e a c u te . A d is t in c t p a tte r n h a s d e v e lo p e d ,
M o n th ly R eview , Vol. L V , No. 4. Free subscription
and additional copies available upon request to the
Research Departm ent, Federal Reserve B a n k of
Atlanta, Atlanta, G eorgia 30303.
’ T h e A d m in is t r a t io n p la n in t r o d u c e d b y S e n a to r H o w a r d
B a k e r is e m b o d ie d in S .2 9 4 8 . I n t h e p a s t , o t h e r p r o g r a m s
h a v e b e e n p r o p o s e d w h ic h w o u ld h a v e s e r v e d th e s a m e p u r
p o s e a s re v e n u e s h a r in g . T a x c r e d it s c h e m e s w e re a m o n g th e
m o s t p r o m in e n t . F o r v a r io u s r e a s o n s , s u p p o r t f o r t h e m
h a s d im in is h e d w h ile s u p p o r t f o r r e v e n u e
s h a r in g
has
in c r e a s e d .
A s e c o n d p la n , g e n e r a lly a t t r ib u t e d to th e A d v is o r y C o m
m is s io n o n I n t e r g o v e r n m e n t a l R e la t io n s , is e m b o d ie d in
th e p r o p o s e d “ I n te rg o v e rn m e n ta l R e v e n u e A c t o f 1 9 6 9 ”
( S .2 4 8 3 ).
M O N TH LY
50
R E V IE W
m e n t r e v e n u e s a r e d e r iv e d
fr o m
s o u r c e s w h ic h
good
r e a s o n s fo r m a in ta in in g a s tr o n g
program
in c r e a s e a t a b o u t th e s a m e r a te a s th e e c o n o m y .
of
O v e r 7 5 p e r c e n t o f th e ir ta x r e v e n u e is d e r iv e d
a r e m o s t e f fe c tiv e ly a d m in is te r e d o n lo c a l le v e ls ,
fr o m
even
s a le s ,
gross
r e c e ip ts ,
and
p ro p erty
ta x es.
su ch
fu n c tio n a l
th o u g h
T h u s , t h e tr e n d a t th e s u b n a tio n a l le v e l h a s b e e n
r e s tr ic te d
fo r e x p e n d itu r e s to o u tp a c e r e v e n u e s — w ith
g o v e r n m e n t.
th e
g r a n ts.
S o m e p u b lic
th e b e n e f its fro m
to
th e
j u r is d ic t io n
The
b e n e fits
th e m
of
can n ot be
th e
fr o m
goods
p r o v id in g
th ese
p u b lic
r e s u lt t h a t m a n y o f th e s e g o v e r n m e n ts h a v e b e e n
g o o d s “ s p ill o v e r ” to o th e r a r e a s. F o r e x a m p le ,
fa c in g w h a t m ig h t b e c a lle d a “ f is c a l d e f ic it .”
a
S ta te
and
lo c a l
g o v e r n m e n ts h a v e
resp on d ed
c i t y ’s
s a n ita tio n
fa c ilit ie s
and
p u b lic
h e a lth
p ro g ra m s c e r ta in ly b e n e fit c itiz e n s o f c o n tig u o u s
to t h is n e e d fo r in c r e a s e d r e v e n u e b y in c r e a s in g
s u b u r b a n a r e a s b y p r e v e n tin g th e s p r e a d o f c o n
t h e i r t a x e s . T h e i r t a x r e c e i p t s r o s e f r o m 6 .1 p e r
ta g io u s
c e n t o f G N P i n 1 9 5 0 t o 8 .8 p e r c e n t i n 1 9 6 7 . B u t
c it y ta x e s to su p p o r t th e s e p ro g ra m s. I n s im p le
t h is m o d e r a te in c r e a s e w a s n o t e a s ily
a c h ie v e d ;
d is e a s e .
Y et
th e
s u b u r b a n ite s
pay
no
te r m s, t h e c i t y w o u ld n o t b e p a id fo r a ll o f t h e
it c a r r ie d a h ig h p r ic e . P r o b le m s o f a d m in is t r a
s e r v ic e s it p r o v id e s .
tio n
to p r o v id e fe w e r o f t h e s e s e r v ic e s th a n it w o u ld
and
c o lle c tio n ,
in te r s ta te
c o m p e titio n ,
and
C o n s e q u e n tly ,
it w ill te n d
h e a v y F e d e r a l u sa g e h a v e h a m p e r e d th e a b ility
if it w e r e c o m p e n s a te d b y a ll w h o s h a r e in th e
o f t h e s e g o v e r n m e n ts to e m p lo y m o r e e q u ita b le ,
b e n e fits .
n o n r e g r e s s iv e r e v e n u e s o u r c e s. A s a r e s u lt, t h e y
s t a t e o r F e d e r a l G o v e r n m e n t c o u ld
O n ly
an
earm arked
h a v e r e s o r te d to n e w o r h ig h e r r e g r e s s iv e ta x e s .
th e
E ven
th e ta x
en su re th a t fu n d s are u sed
have
a ls o
in c r e a s e s w e r e n o t e n o u g h . T h e y
g r e a tly
in c r e a s e d
th e ir
d e b t.
G ross
d e b t o f s u b n a t io n a l g o v e r n m e n ts r o s e fro m
c ity
fo r
th e
s u b n a tio n a l
w a y s m u st b e fo u n d
g o v e r n m e n ts
b e n e fits
and
a ls o
to p r o v id e a d e q u a te
s a n it a tio n f a c ilit ie s a n d p u b lic h e a lt h
p rogram s.
The
P r o p o s a ls
to h e lp
gap
T h e A d m in is tr a t io n r e v e n u e s h a r in g p la n , if e n
a c t e d , w o u ld p r o v id e fo r t h e a n n u a l d is t r ib u tio n
n u e s h a r in g
of
p o se,
is a
p la n
d e fic it b y
u n earm ark ed
to
th e
th e
b e tw e e n th e ir e x p e n d itu r e s a n d r e v e n u e s . R e v e
lo c a l f is c a l
fill
of
fr o m
co m p en sa te
$24
b illio n in 1 9 5 0 to o v e r $ 1 1 4 b illio n in 1 9 6 7 .
O b v io u s ly , n e w
sp illo v e r
grant
g r o w in g
r e lie v e
th e
d is tr ib u tin g
g ra n ts
sta te an d
gen eral
fro m
th e
pur
F ederal
G o v e r n m e n t to th e s e g o v e r n m e n ts. A t th e sa m e
tim e
th a t
th e
s u b n a tio n a l
d e f ic it is r e lie v e d , th e
g o v e r n m e n ts’
g r a n ts w o u ld
fis c a l
d is p o s e
of
s o m e o f th e fu tu r e F e d e r a l fis c a l d iv id e n d s .
S u b n a tio n a l
g o v e r n m e n ts
o f p u b lic
r e s o r t in g t o n e w
c o u ld
goods and
im p r o v e
s e r v ic e s
u te d
a n n u a lly
o r h ig h e r r e g r e s s iv e ta x e s . I n
( th e
annual
tio n w o u ld b e o n e - s ix t h
fis c a l
th e
sta te s
and
th e
fu n d )
w o u ld
equal
year
in
b e g in n in g
gradual
o f o n e p e r c e n t fo r th e
J u ly
1,
1970,
in c r e m e n ts
to
b u t w o u ld
one
percent
fo r th e fis c a l y e a r 1 9 7 6 a n d th e r e a fte r .
th e ir
w ith o u t
am ong
a p r o p o r tio n o f t o ta l ta x a b le in c o m e . T h e p r o p o r
in c r e a s e
T h e r e a r e m a n y a d v a n ta g e s to r e v e n u e s h a r in g .
p r o v is io n
F ederal revenues
D is t r ic t o f C o lu m b ia . T h e t o ta l a m o u n t d is t r ib
T h e p e r c e n t a g e o f th e a n n u a l fu n d w h ic h g o e s
t o a p a r t i c u la r s t a t e g o v e r n m e n t
d e t e r m in e d
p r im a r ily b y
(its sh a re)
is
t h e s t a t e ’s p o p u l a t i o n .
s t e a d , F e d e r a l t a x r e v e n u e w o u ld b e s h a r e d w ith
I t is a d ju s te d , h o w e v e r , fo r t h e r e v e n u e e ffo r ts
th e m .
of
S in c e th e c h o ic e o f p r o je c ts a n d
over
th e
e x p e n d itu r e s
le v e l,
s u b n a tio n a l
m ore
r e s p o n s iv e
u e n ts.
F ederal
w o u ld
be
g o v e r n m e n ts
to
th e
needs
a s s is ta n c e
on
th e
s h o u ld
of
th e ir
w o u ld
c o n tr o l
lo c a l
becom e
c o n s tit
b ecom e
le s s
a ll
c ity ,
its
s p e c ia l
to
u n its
of
in d e p e n d e n t
d is tr ic ts .
fin a n c e
th e ir
g o v ern m e n t— sta te ,
sch o o l
S ta te s
d is tr ic ts ,
m a k in g
e x p e n d itu r e s
str o n g
fro m
c o u n ty ,
and
o th e r
e ffo r ts
th e ir
ow n
s o u r c e s w o u ld r e c e iv e m o r e th a n s t a t e s m a k in g
payment
e n c u m b e r e d a n d m o r e e f fic ie n t a s r e c ip ie n t d e
o n ly w e a k e ffo r ts . T h e to ta l a n n u a l
te r m in a tio n
b e c o m e s a u to m a tic a n d
a p a r t i c u la r s t a t e g o v e r n m e n t e q u a l s t h e p r o d u c t
tio n
s h ifts
to
p la n
sh o u ld
lo c a l
reduce
g o v e r n m e n ts.
th e
a d m in is tr a
F in a lly ,
a d m in is tr a tiv e
th e
c o sts o f
c o lle c tin g ta x e s. I n s te a d o f a m u ltitu d e o f c o m
p e tin g
ta x
c o lle c to r s ,
G o v e r n m e n t— w o u ld
o n ly
p erfo rm
o n e— th e
a
la r g e r
part
ta x p a y e r,
is
not
a
c u r e -a ll.
It
sh o u ld
a u g fn e n t, r a th e r th a n r e p la c e , e a r m a r k e d F e d e r a l
g r a n ts to s t a t e a n d lo c a l g o v e r n m e n ts . T h e r e a r e
A P R IL 1970
a n d th e to ta l a n n u a l fu n d . P a y m e n t s
E ach
s t a t e g o v e r n m e n t m u s t, in tu r n , d is t r ib
of
B u t r e v e n u e s h a r in g , a lt h o u g h it w o u ld b e n e
th e
share
to s t a t e s w o u ld b e m a d e a t le a s t q u a r te r ly .2
F ederal
th e ch ore.
fit
o f its
to
2 T h e s h a r e o f a s t a t e is d e f in e d t o b e t h e p r o d u c t o f it s
p o p u l a t i o n a n d it s r e v e n u e e f f o r t d i v id e d b y t h e s u m o f
a ll s u c h p r o d u c t s f o r a ll f if t y - o n e r e c ip ie n ts . T h e r e v e n u e
e f f o r t o f a s t a t e is d e t e r m in e d b y d i v id in g ( 1 ) t h e t o t a l
g e n e r a l r e v e n u e ( f r o m t h e ir o w n s o u r c e s ) r a is e d b y th e
s t a t e g o v e r n m e n t a n d a ll it s u n it s o f l o c a l g o v e r n m e n t b y
( 2 ) th e to ta l p e r s o n a l in c o m e o f th a t sta te .
51
u te to s o m e o f it s lo c a l g o v e r n m e n ta l u n its a p a r t
w o u ld
th e
o f t h e r e v e n u e w h ic h i t r e c e iv e s u n d e r t h e p la n .
n eed s?
In
O n ly
b e g r e a t. I n d e e d , th e a m o u n ts sh a r e d w o u ld b e
g e n e r a l p u r p o s e lo c a l g o v e r n m e n ts — c o u n
program
a b s o lu te
go
t ie s , c it ie s , t o w n s h ip s — w o u ld sh a r e . I n d e p e n d e n t
s m a ll c o m p a r e d w ith
sch ool
m e n ts
d is tr ic ts
th o u g h
w o u ld
th e y
and
o th e r
c o n tr ib u te
s p e c ia l
to
n o t a u to m a tic a lly
th e
d is tr ic ts ,
a l
revenue
e ffo r t,
fu n d s.
T hey
r e c e iv e
r a is e
fr o m
to w a rd
te r m s
th e
th e rev en u e th e se
th e ir
ow n
era l p u r p o se g o v e r n m e n ts.
c o n tr ib u te to th e ir s o lu tio n .
a m ou n t p a ssed
th e
sta te
im p o r ta n c e
on
to
lo c a l
governm ent
of
th e se
g o v e r n m e n ts
dep en d s
u n its
in
th e
on
s t a t e ’s
th e
to ta l
sou rces.
not
govern
H ow ever,
fu n d s . C o n s e q u e n tly , a lth o u g h s h a r in g w o u ld n o t
so lv e
The
th e ir
it w o u ld b e a g r o w in g a n d n e w s o u r c e o f n e e d e d
m u s t r e ly , in s te a d , o n t h e g e n e r o s ity o f th e g e n
by
m e e t in g
e f fe c t w o u ld
a ll
of
th e ir
fin a n c ia l
p r o b le m s ,
it
w o u ld
F l o r id a , t h e m o s t p o p u l o u s S o u t h e a s t e r n s t a t e ,
h a s t h e la r g e s t c o m b in e d
(T a b le
1 ).
It
sta te
w o u ld
and
r e c e iv e
lo c a l s h a r e
3 .1 7
percent
g o v e r n m e n ta l a c t iv it y . T h e p r o p o r tio n o f s h a r e d
o f th e to ta l fu n d . M is s is s ip p i, w ith th e s m a lle s t
reven u es
p o p u la tio n ,
t h a t lo c a l
g o v e r n m e n ts r e c e iv e
b e th e s a m e a s t h e p r o p o r tio n
revenue
r a is e 3 0
th e y
r a is e .
T h u s,
p e r c e n t o f a ll
w o u ld
o f to ta l g e n era l
if lo c a l
reven u e
g o v e r n m e n ts
r a is e d
by
su b
1 .3 4
w o u ld
p ercen t.
s h a r e , is f o llo w e d b y
A la b a m a
in
n a t i o n a l g o v e r n m e n t s i n a p a r t i c u la r s t a t e , t h e n
tio n ,
r a n k in g
th e y
w o u ld
r e c e iv e
30
percent
of
S e n a te
v e r s io n
of
revenue
th e
th a t
th e
w ith
s m a lle s t
th e
sh a re—
se co n d
la r g e s t
L o u is ia n a , T e n n e s s e e , a n d
order.
W ith
o f sh a res
o n ly
one
excep
co rresp on d s
to
th e
th e
sh ared
r a n k in g o f t h e s e s t a t e s b y p o p u la t io n . T e n n e s s e e ,
w h ic h
has a
s h a r in g
d iffe r s
w o u ld
r e c e iv e
r e v e n u e g o in g to t h a t s ta te . ’
A
r e c e iv e
G e o r g ia ,
la r g e r p o p u la t io n
a
s m a lle r
sh are
th a n
L o u is ia n a ,
th a n
L o u is ia n a .
f r o m t h e A d m i n i s t r a t i o n ’s p la n . P e r h a p s t h e m o s t
T h e r e a s o n fo r t h is is s im p le . W h e n t h e s t a t e s ’
im p o r ta n t d iffe r e n c e
p o p u la t io n s a r e a d j u s t e d fo r t h e ir r e v e n u e e ffo r ts ,
is
th a t
it
w o u ld
cost
th e
F e d e r a l G o v e r n m e n t m o r e . T h e r e v e n u e s h a r in g
L o u is ia n a m o v e s a h e a d o f T e n n e s s e e . O f t h e s ix
fu n d
ta x a b le
in c o m e
sta tes
p erson al
in c o m e
r e v e n u e e ffo r t— t h a t is , t h e g e n e r a l r e v e n u e s o f
ta x c o lle c t io n s in th e p r e v io u s y e a r . T h is fo r m u la
a ll it s u n its o f g o v e r n m e n t a r e a h ig h e r p r o p o r
p lu s
w o u ld
25
be
one
percent of
p e r c e n t o f to ta l
sta te
c o n s id e r e d ,
L o u is ia n a
has
th e
h ig h e s t
w o u ld r e s u lt in t h e F e d e r a l G o v e r n m e n t s h a r in g
t i o n o f L o u i s i a n a ’s p e r s o n a l i n c o m e t h a n i n a n y
a b o u t $ 7 b illio n o f it s r e v e n u e in f is c a l 1 9 7 1 a n d
o th e r
a b o u t $ 1 0 b illio n t h e n e x t y e a r . T h e A d m in is tr a
g r e a te r ta x e ffo r t r e s u lts fr o m
tio n p r o p o sa l p r o v id e s fo r a fu n d o f a b o u t $ 2 7 5
la r g e -s c a le o il p r o d u c tio n .
m illio n in f is c a l 1 9 7 1 . T h is w o u ld g r o w to a b o u t
$ 4 b illio n b y fis c a l 1 9 7 6 .
In a d d itio n , th e r e is a m a jo r d iff e r e n c e in th e
The
sta te
(T a b le
r a n k in g
th e m s e lv e s
c lo u d y .
ta k in g
A fte r
to
S e n a te v e r s io n , s t a t e g o v e r n m e n ts w o u ld
govern m en t of
q u ir e d to p a s s th r o u g h fu n d s to o n ly th o s e lo c a l
o f sh a res
g o v e r n m e n ts
w a y s a s t a t e c o u ld u s e it s sh a r e d fu n d s. I n th e
be re
2 ).
lo c a l
th e
g o v e r n m e n ts
F lo r id a
M uch
of
a c c r u in g
is
to
to ta x
th e
sta te
so m ew h a t
r e q u ir e d
in to
L o u i s i a n a ’s
its a b ility
d is tr ib u tio n s
a c c o u n t,
w o u ld
m ore
r e c e iv e
th e
sta te
2 .2 4
p er
c e n t o f th e to ta l fu n d a n d w o u ld r a n k f ir s t a m o n g
g o v e r n m e n t s w i t h p o p u l a t i o n s o f 5 0 ,0 0 0 o r m o r e .
S m a lle r lo c a l g o v e r n m e n ts w o u ld
c a lly
sh a re.
A ls o ,
so m e
of
th e
n o t a u to m a ti
fu n d
w o u ld
be
T a b le
r e se r v e d fo r e d u c a tio n a l p u r p o se s.
H o w W ill
P e r c e n t o f T o ta l F u n d T o B e R e c e iv e d
b y D is t r ic t S t a t e a n d L o c a l G o v e r n m e n t s
R e v e n u e S h a r in g
A ff e c t th e S o u t h e a s t ?
W h a t w o u l d t h e A d m i n i s t r a t i o n ’s p l a n m e a n f o r
g o v e r n m e n ts
in
th e
S o u th e a st?
J u st
1
how
fa r
^ T h e s h a re o f a ll g e n e ra l p u r p o s e lo c a l g o v e rn m e n ts in a
s t a t e w o u ld e q u a l a f r a c t io n w h o s e n u m e r a t o r is t o t a l
g e n e ra l re v e n u e o f a ll g e n e ra l p u r p o s e lo c a l g o v e rn m e n ts
in t h e s t a t e a n d w h o s e d e n o m in a t o r is t o t a l g e n e r a l r e v e n u e
o f a ll u n it s o f g o v e r n m e n t in t h e s ta te . T h e p r o p o r t io n
g o in g t o a n i n d i v i d u a l u n i t o r g o v e r n m e n t is d e t e r m in e d in
th e s a m e m a n n e r e x c e p t th a t th e n u m e r a t o r o f th e f r a c t io n
is t h e g e n e r a l r e v e n u e o f t h e i n d iv id u a l g o v e r n m e n t in
q u e s t io n .
State
State
P lu s
Local
Local
State
A lab am a
1.80
0.45
1.35
F lorida
3.17
0.92
2.24
Georgia
2.23
0.49
1.73
2.22
0.39
1.83
L o u isian a
M ississip p i
1.34
0.32
1.03
Tennessee
1.85
0.80
1.04
Source: Special A n alyse s of the Bu d ge t
U nited States, Fiscal Y e a r 1971
of
the
MONTHLY REVIEW
52
T a b le
2
T a b le
R a n k in g s of D is t r ic t S t a t e s by P o p u la t io n a n d
R e v e n u e E ffo rts of A ll U n it s of G o v e r n m e n t
Size of F u n d to be D istributed
Population
1967 and 1968
1967
1968
A lab am a
5
4
3-4
F lo rid a
1
3
3-4
G eorgia
2
5
5
Lo u isian a
4
1
1
M ississip p i
6
2
2
Tennessee
3
6
6
Federal Reserve B a n k of A tla n ta
S o u th e a ste r n
sta te
s e c o n d , f o llo w e d
g o v e r n m e n ts.
by
R e c e ip t s fro m R e v e n u e S h a r in g by T y p e of
G o v e r n m e n t 1 ($ m illio n s )
Revenue E ffo rt
State
Source:
L o u is ia n a
3
is
G e o r g ia , A l a b a m a , T e n n e s
s e e , a n d M is s is s ip p i in th a t o rd er.
Government
$275
$4,000
Alabam a
State
Local
4.9
3.7
1.2
72.0
54.0
18.0
Florida
State
Local
8.7
6.2
2.5
126.8
90.0
36.8
G eorgia
State
Local
6.1
4.8
1.3
89.2
69.6
19.6
Lo uisian a
State
Local
6.1
5.0
1.1
88.8
73.2
15.6
M ississip p i
State
Local
3.7
2.8
.9
53.6
40.8
12.8
Tennessee
State
Local
5.1
2.9
2.2
74.0
42.0
32.0
T h e r a n k in g d o e s n o t n e c e s s a r ily in d ic a t e t h e
r e la t iv e im p o r ta n c e o f th e s t a t e g o v e r n m e n t. F o r
e x a m p le ,
th e
sta te
governm ent
of
fir st-r a n k e d
F lo r id a c o lle c t e d o n ly 4 5 p e r c e n t o f a ll g e n e r a l
revenues
c o lle c te d
F lo r id a in
by
g o v e r n m e n ta l
u n its
in
1 9 6 7 , w h e r e a s th a t o f b o tto m -r a n k e d
M is s is s ip p i c o lle c te d a b o u t 5 9 p e r c e n t. T h e d if
feren ce
is
p o rta n t
in
th a t
sp e c ia l
F lo r i d a ,
d is tr ic ts
are
th e ir
e ffo r ts
and
m ore
im
ten d
to
1D u e
to r o u n d in g , th e s u m
o f sta te
n o t c o r r e s p o n d e x a c t ly t o t h e s t a t e 's t o t a l.
and
lo c a l
m ay
r a i s e t h e s t a t e g o v e r n m e n t ’s s h a r e .
T h e sa m e e x p la n a tio n
a p p lie s w h e n o n e c o n
s i d e r s t h e r e l a t i v e l y h i g h p o r t i o n o f T e n n e s s e e ’s
n ot ch an ge,
to ta l s h a r e w h ic h g o e s to t h e lo c a l g o v e r n m e n ts .
F l o r id a ( a b o u t $ 9 0 m i l l i o n t o t h e s t a t e a n d $ 3 6 .8
S p e c ia l
d is tr ic ts
are
r e la tiv e ly
u n im p o r ta n t
in
p r o v id e
m illio n to lo c a l g o v e r n m e n ts )
th e g o v e r n m e n ta l stru ctu re o f T e n n e s se e . M a n y
in M is s is s ip p i
o f th e ir
a n d $ 1 2 .8 m i l l i o n
general
tr a d itio n a l
p u rp o se
fu n c tio n s a r e c o n d u c te d
c ity
and
c o u n ty
by
b etw een
H ow
g o v e r n m e n ts,
(n e a r ly
$41
$ 1 2 6 .8
m illio n
in
a n d $ 5 3 .6 m i l l i o n
m illio n
to
th e sta te
to lo c a l g o v e r n m e n t s ) .
d o e s th e D is t r ic t c o m p a r e w ith
th e rest
a n d c o n s e q u e n tly th e s h a r e d u e to t h e s e a c t iv itie s
o f th e c o u n tr y ? T h e r e v e n u e s h a r in g fu n d m u s t
goes
b e r a is e d th r o u g h
to
lo c a l
g o v e r n m e n ts
r a th e r
th a n
to
th e
s t a t e . S o m e o f t h e lo c a l g o v e r n m e n ts ’ im p o r ta n c e
la r in
a ls o
m e n ts,
r e s u lts fro m
th e
r e la tiv e ly
le s s a c t iv e r o le
o f th e s t a t e g o v e r n m e n t in T e n n e s s e e . I n
1967,
F e d e r a l ta x e s. F o r e v e r y d o l
rev en u e sh a red
a
d o lla r
in
w ith
s u b n a tio n a l g o v e r n
F ederal
ta x es
m u st be
c o l
le c te d . A s t a t e is b e tte r o f f o n ly i f m o r e r e v e n u e
o n l y F l o r i d a ’s s t a t e g o v e r n m e n t r a i s e d a s m a l l e r
is
p ercen ta g e
r e v e n u e s h a r i n g i s e n a c t e d i n t o la w , e a c h D i s t r i c t
o f to ta l g en era l
revenue
(r a is e d
a l l l e v e l s o f g o v e r n m e n t in t h e s t a t e )
th a n
by
d id
w ith
it
th a n
is
c o lle c te d
fro m
it.
If
s t a t e w o u ld g a in fr o m s h a r in g b e c a u s e t h e p e r
c e n t a g e o f s h a r e d r e v e n u e w h ic h e a c h s t a t e w o u ld
T e n n e s s e e ’s .
T h e s h a r e s a r e c o n v e r te d in to d o lla r a m o u n ts
in T a b le 3 . I f $ 2 7 5 m illio n w e r e s h a r e d , p a y m e n t s
r e c e iv e
fo r M is s is s ip p i. P a s s th r o u g h
pay
is
g re a te r
th a n
th e
p er c e n ta g e
of
th e
F e d e r a l ta x b ill w h ic h it p a y s ( T a b le 4 ) .
w o u l d v a r y b e t w e e n $ 8 .7 m i l l i o n fo r F l o r id a a n d
$ 3 .7 m i l l i o n
sh ared
E s s e n tia lly
th e
o f in c o m e fro m
p la n
in v o lv e s
s t a t e s w ith
lo w
a
tr a n sfe r
r e v e n u e e ffo r ts
m e n ts to lo c a l g o v e r n m e n ts w o u ld r a n g e b e tw e e n
to
$ 2 .5 m i l l i o n i n F l o r i d a a n d $ .9 m i l l i o n i n M i s s i s
lo w -in c o m e
sip p i. S ta t e g o v e r n m e n ts w o u ld b e le f t w ith b e
e ffo r ts,
tw een
lo w e r r e v e n u e e f fo r ts . S in c e S o u th e a s te r n s t a t e s
$ 6 .2
m illio n
(F lo r id a )
and
$ 2 .8
m illio n
w ith
1 9 7 6 w o u ld , if s h a r e s d o
A P R IL 1970
fo r t)
h ig h
sta tes
and
a r e g e n e r a lly
( M is s is s ip p i).
A $ 4 -b illio n fu n d in
sta te s
reven u e
ten d
to
h ig h -in c o m e
lo w -in c o m e
e ffo r ts .
T y p ic a lly ,
h a v e h ig h e r r e v e n u e
sta te s
ten d
to
have
(a n d h ig h -r e v e n u e e f
s t a t e s , t h e y w o u ld g a in fr o m sh a r in g . I n a
53
T a b le
4
m ore
g o v e r n m e n ta l
s e r v ic e s .
S econd
to
M is s is
s ip p i in th e S o u th e a s t w o u ld b e L o u is ia n a w it h a
C o m p a r is o n o f F e d e ra l T a x B ill
a n d R e v e n u e S h a r e s fo r
D is t r ic t S t a t e s
g a i n o f $ .6 7 p e r c i t i z e n . F l o r i d a i s l a s t w i t h $ .2 1
p e r p e r s o n . I f $ 4 b illio n w e r e s h a r e d , t h e g a in s
w o u l d b e p r o p o r t i o n a t e l y la r g e r . A s s u m i n g t h a t
Percent
Federal T a x
B ill
1968
State
ta x b u r d e n s a n d s h a r e s d o n o t c h a n g e , th e g a in
Percent of
Revenue
Shared
A lab am a
1.12
1.80
3.17
w o u ld b e a b o u t $ 1 2 .6 0 p e r p e r s o n in M is s is s ip p i.
L o u is ia n a
F lo r id a
w o u ld
w o u ld
be
seco n d
g a in
th e
w ith
about
$ 9 .7 5 .
le a s t — a b o u t $ 3 .1 0
per
p erson .
Florida
2.70
Georgia
1.68
2.23
Louisian a
1.32
2.22
M ississip p i
.59
1.34
T h is
Tennessee
1.40
1.85
p o s s ib le e f f e c t s o f F e d e r a l r e v e n u e sh a r in g . F o r
O b s e r v a t io n s
Sources: T a x Foundation, Inc., and Special A n a ly
ses, Budget of the U nited States, Fiscal
Y e a r 1971
d is c u s s io n
e x a m p le ,
in
an
and
does
not
e ffo r t
to
C o n c lu s i o n s
a tte m p t
to
in c r e a s e
cover
th e ir
a ll
sh ared
r e v e n u e s , in d iv id u a l s t a t e a n d lo c a l g o v e r n m e n ts
m a y te n d to r e ly m u c h m o r e h e a v ily o n t a x a tio n
in th e fu tu r e , r a th e r th a n b o n d fin a n c in g . W h ile
th e s h o r t-r u n p o s s ib ilit ie s o f g a in s fr o m
l i m i t e d s e n s e , t h i s w o u l d r e s u l t in h i g h e r i n c o m e
s w it c h
fo r S o u th e a s te r n s t a t e s .
n a tio n a l
U n le s s
th e
r e c e iv in g
g o v e r n m e n ts
cut
th e ir
g a in s
m ay
g o v e r n m e n t,
are
ta x e s , th e g a in s w o u ld n o t a c c r u e to c it iz e n s o f
m a tic a lly
a
th e
s t a t e in
th e
fo r m
o f h ig h e r
m oney
in c o m e s .
lo o k a ttr a c tiv e
s lim .
th e
A ls o ,
su ch
a
to a p a r t ic u la r s u b
chances
a u to
p la n ,
T h e y w o u ld b e in t h e fo r m o f m o r e g o v e r n m e n t
m ay
d e p e n d la r g e ly u p o n th e m a n n e r in w h ic h s t a t e
th e
a s s u m p tio n
th a t
th e
p er
w ith
tim e .
g o v e r n m e n ta l u n its
se r v ic e s .
U nder
ch an ge
do
lo n g -r u n
s h a r e u n d e r t h e A d m in is tr a t io n
p u rp ose
th e y
of
not
r o le o f s p e c ia l
s in c e
T h e ir
fu tu r e
r o le
m ay
c e n t a g e d is t r ib u tio n o f t h e F e d e r a l t a x b ill h a s
g o v e r n m e n ts c h o o s e to
n o t c h a n g e d s in c e 1 9 6 8 , T a b le 5 sh o w s th e e s t i
g o v e r n m e n t p a s s e s o n to th e m th e sh a r e d r e v e n u e
m a te d
p e r c a p ita
g a in s
w h ic h
w o u ld
accrue
each
s t a t e a s a r e s u lt o f sh a r in g . I f a
$275
m illio n
w ere
sh a red , th e
to
to ta l o f
g o v e r n m e n ts
of
M i s s i s s i p p i w o u l d r e c e i v e $ .8 6 p e r p e r s o n m o r e
w h ic h
a c c r u e s to
tr e a t th e m . If th e sta te
it a s a r e s u lt o f th e
t a x a tio n
e ffo r t o f th e s e s p e c ia l p u r p o se g o v e r n m e n ts , th e n
su c h g o v e r n m e n ts a r e lik e ly to c o n tin u e to h a v e
an
i m p o r t a n t r o le i n o u r g o v e r n m e n t s t r u c t u r e .
th a n M is s is s ip p ia n s w o u ld h a v e p a id in F e d e r a l
D o u b tle s s , th e r e m ig h t b e n u m e r o u s o th e r s id e
t a x e s to f in a n c e t h e r e v e n u e s h a r in g . T h e g a in to
e f fe c ts o f r e v e n u e sh a r in g . B u t to b e c o m e o v e r ly
M i s s i s s i p p i a n s i s $ .8 6 p e r p e r s o n in t h e f o r m o f
concerned
w ith
th e se
w o u ld
o v e r lo o k
th e
ad
v a n ta g e s o f s h a r in g a n d n e e d s o f s t a t e a n d lo c a l
g o v e r n m e n ts . I f s u b n a t io n a l g o v e r n m e n ts a r e to
p r o v id e fo r t h e n e e d s o f t h e ir c o n s t it u e n t s in t h e
T a b le
fu tu r e ,
5
th e y
p r o v id in g
P e r C a p it a G a in s fro m
R e v e n u e S h a r in g
g iv e n
n eed s.
so m e
a s s is ta n c e
R evenue
s h a r in g
in
is
p r o b a b ly a s e f f ic ie n t a s a n y o th e r m e th o d w h ic h
h as b een
Size of F u n d to be D istributed
State
m u st b e
th o se
$275 M illio n
$4,000 M illio n
su g g ested .
It
is
s im p le ,
d e fin ite ,
and
e q u ita b le . T h e s a m e fo r m u la a p p lie s to a ll, a n d
th u s, th e r e a p p e a r s to b e lit t le j u s t if ic a t io n
fo r
c o m p la in t s o f d is c r im in a to r y tr e a tm e n t, w it h t h e
$ .52
$ 7.60
F lorid a
.21
3.11
m e n ts . I n d e e d , it w o u ld b e a s ig n if ic a n t p a r t o f
Georgia
.33
4.83
th e a n sw e r to th e f is c a l d e f ic it, w h ic h
lo o k in g lo c a l o f fic ia ls fa c e . I t is n o t a p a n a c e a ,
A labam a
Lou isian a
.67
9.74
M ississip p i
.86
12.64
Tennessee
.32
4.59
Source:
Federal Reserve B a n k of A tlan ta
54
p o s s ib le
b u t it
is
e x c e p tio n
of
s p e c ia l
p u rp ose
govern
fo rw a rd -
a p o t e n t ia lly la r g e a sp ir in .
R
obert
H. F
M O N TH LY
loyd
R E V IE W
G e o rg ia 's E co n o m y J o g s A long
The
term
jo g g in g
h as been
in
w id e s p r e a d
r e c e n tly , a n d to m o s t p e o p le th e te r m
s lo w -m o v in g
fo rw a rd
pace— an
u se
G e o rg ia 's member banks outpaced the
nation in the grow th of total loans,
m eans a
e x p r e s s io n
th a t
dep osits, and time deposits until late
sum m er 1969.
i s u s e d fr e q u e n tly b y t h o s e w h o d e s ir e to r e m a in
in
good
d u r in g
p h y s ic a l
1969
c o n d itio n .
c o u ld
be
G e o r g i a ’s
d e s c r ib e d
econom y
a c c u r a te ly
by
Year-Ago % Chg.
t h is te r m , fo r t h e te m p o o f h e r e c o n o m y d id , in
d e e d , s lo w
dow n
fr o m
a r u n n in g
p a c e in
1968
to a jo g in 19 6 9 .
Banks and savings and
the impact of shifting
which in turn restricted
funds to borrowers. The
was adversely affected.
loan institutions felt
monetary conditions,
the flow of available
construction industry
T IM E
T im e d e p o s its sta r te d
1969.
o n a d o w n h ill n o t e in
T h e tr e n d c o n tin u e d th r o u g h o u t t h e y e a r ,
a lth o u g h
t h e r a te o f d e c lin e s lo w e d in
q u a r te r .
L a ter,
very
D E P O S IT S
r e c e n tly
tim e
d e p o s its
have
sh ow n
th e la s t
le v e lle d
s ig n s
of
o ff
and
recovery.
W h e n c o m p a r e d w ith U . S . m e m b e r b a n k s, t im e
d e p o s its
in
G e o r g ia
h e ld
up
b e tte r
d u r in g
th e
fir s t n in e m o n th s o f 1 9 6 9 .
A
m ore
s ig n ific a n t
b a r o m e te r
of
s la c k e n in g
e c o n o m ic a c t iv it y w a s t o ta l d e p o s it s . I n t h e fir s t
e ig h t m o n th s o f 1 9 6 9 , to ta l d e p o s its h e ld u p b e tte r
th a n n a tio n a lly , b u t a s th e y e a r d r e w to a c lo s e ,
p e r ie n c e
t h e y c o m p a r e d le s s fa v o r a b ly . T h e tr e n d h a s c o n
m a in e d
tin u e d in to 1970.
m ir r o r t h i s f a c t . A l l m o n t h l y l o a n f i g u r e s i n 1 9 6 9
Though
upw ard
th e
w hen
cost of
le n d in g
A P R IL 1970
b o r r o w in g
in s titu tio n s
fu n d s
began
p u sh ed
to e x
w ere
in
a
liq u id it y
stro n g
above
1968,
but
in
th e
sq u eeze,
G e o r g ia .
c o r r e s p o n d in g
lo a n
g ro w th
lo a n
T o ta l
dem and
lo a n
m o n th ly
s lo w e d
as
re
fig u r e s
fig u r e s
th e
year
55
G eorgia em ploym ent indicators began to taper o ff after m id*1969.
Seas. Adj.. 1957-59=100
1968
1969
1968
1970
1969
1970
*Seas. adj. figure; not an index
p ro g ressed .
The
sa m e
s itu a tio n
w as
g e n e r a lly
tru e o f th e rest o f th e U . S.
B anks
G e o r g ia
and
d u r in g
fu n d s s h r in k
flo w s.
s a v in g s
and
1969
lo a n
w a tch ed
in s t itu t io n s
th e ir
a s a r e s u lt o f r e d u c e d
N e v e r th e le s s ,
a lth o u g h s tr a p p e d
th e
th e s e ttle m e n t o f a n a u to d is p u te c a u s e d a s ig n ifi
can t
in
lo a n a b le
s a v in g s in
c o n s tr u c tio n
in c r e a s e
in
m a n u fa c tu r in g
e m p lo y m e n t.
B e g in n in g in e a r ly s u m m e r a n d s e r v in g a s a v iv id
r e m in d e r
of
th e
s lo w d o w n
w a s a ta p e r in g -o ff in
in
b u ild in g
c o n s tr u c tio n
a c tiv ity
e m p lo y m e n t.
in d u s tr y ,
I n e a r ly 1 9 7 0 , o v e r a ll e m p lo y m e n t d e c lin e d s lig h t
fo r f u n d s , m a d e a fa ir s h o w
ly , a lth o u g h th e r a te o f u n e m p lo y m e n t r e m a in e d
in g fo r t h e y e a r d e s p it e it s tr o u b le s. R e s id e n t ia l
b e lo w th a t o f t h e D is t r ic t a n d t h e n a tio n .
c o n s tr u c tio n c o n tr a c t a w a r d s m o d e r a te d u n til th e
y e a r ’s f i n a l q u a r t e r , a l t h o u g h
m e n t w a s n o te d
in
e a r ly
a
1970.
s lig h t im p r o v e
A w ards
fo r a ll
o th e r t y p e s o f c o n s tr u c tio n fa r e d s o m e w h a t b e t
te r fo r t h e y e a r a s a w h o le . B o o s tin g
th e to ta l
Georgia's growth of personal income in 1969
continued to outpace the nation's.
o f o th e r c o n tr a c ts a w a rd e d w a s a D e c e m b e r a n
n o u n c e m e n t o f a m a m m o th e le c tr ic p o w er s y s te m
to b e c o n s tr u c te d in B a r to w C o u n ty .
Alth ough the g ro w th of U .S. personal
incom e slo w e d in 1969, the Peach
Georgia employment continued to expand in
the last year of the Sixties, but conditions be
came more unsettled as 7 9 6 9 came to a close
and 1970 began.
S ta te 's rate of in cre ase did not.
Seas. Adj., Qtrly. % Chg.
G e o rgia
N o n fa r m
e m p lo y m e n t
la st
year
d id
not
in
c r e a s e a s s t e a d ily a s it d id in 1 9 6 8 . P a r tic u la r ly
str ik in g w a s t h e ta p e r in g -o ff in jo b g r o w th a t t h e
e n d o f 1 9 6 9 . M a n u fa c tu r in g a n d n o n m a n u fa c tu r
in g
e m p lo y m e n t,
m a n u fa c tu r in g
p a y r o lls ,
and
a v e r a g e w e e k ly h o u r s fo r m a n u fa c tu r in g s h o w e d
s lig h tly
m o r e f lu c tu a t io n in
T h is w a s e s p e c ia lly
tr u e in
1 9 6 9 th a n in
1968.
la te su m m er
w hen
a n in f lu x o f w o r k e r s fo r to b a c c o p r o c e s s in g a n d
56
Source:
Department of Commerce
M O N T H L Y R E V IE W
T h is w a s in k e e p in g w ith t h e tr e n d o f p r e v io u s
years.
W ages
and
s a l a r ie s ,
w h ic h
account
The
to b a cco
h arvest
w as
up
fr o m
1968,
a l
fo r
th o u g h y ie ld p er a c r e a n d p r o d u c tio n w e r e d o w n
in c o m e ,
fro m t h e p r e v io u s tw o y e a r s . C o tto n a n d s o y b e a n
in c r e a s e d m o r e r a p id ly th a n in th e n a tio n a s a
p r o d u c tio n a n d y ie ld p e r a c r e a ls o c lim b e d d u r
w h o le . D u r in g t h e fo u r th q u a r te r o f 1 9 6 9 , G e o r
in g 1 9 6 9 .
over
h a lf
of
G e o r g i a ’s
to ta l
p ersonal
g i a ’s p e r s o n a l i n c o m e g r o w t h s p u r t e d p a s t m o s t
o th e r S o u th e a ste r n
e x p a n s io n
in
th e
sta tes a n d
n a t i o n ’s
th e
U.
p erson al
S . W h ile
in c o m e
has
c o n t i n u e d t o t a p e r o f f i n 1 9 7 0 , G e o r g i a ’s p e r s o n a l
in c o m e g ro w th s h o u ld , b a se d o n p a s t e x p e r ie n c e ,
o u tp a c e th e U . S.
The agricultural sector of the state's economy
gained as cash receipts from farm marketings
climbed above a year ago. M ost crops regis
tered increased production.
The new year began in much the same way
that 7969 ended, although as 1970 has pro
gressed, it is evident that Georgia is under
going an economic adjustm ent similar to that
of the nation's. If, as many believe, these
adjustments do not intensify by the second
half of the year, Georgia should share in any
pickup of national economic activity.
G e o r g i a ’s
G e n e r a lly ,
stro n g
p r ic e s
fo r
c a ttle , a n d p e a n u ts e n a b le d
eggs,
h o g s,
G e o r g ia
beef
in
a
e c o n o m ic
la c k lu s te r
in d ic a to r s
m anner
d u r in g
have
th e
beh aved
fir s t
fe w
fa rm e rs to
m o n th s o f 1 9 7 0 . T h e p r o c e s s o f e c o n o m ic a d ju s t
e n d t h e y e a r o n a b r i g h t n o t e . G e o r g ia , t h e l a r g e s t
m e n t h a s b e e n v iv id ly p o r tr a y e d in m a n u fa c tu r
U . S . p ro d u cer o f p e c a n s, h a r v e ste d a p e c a n cro p
in g , s i n c e a u t o a s s e m b l y p l a n t s w e r e s h u t d o w n
in 1 9 6 9 t h a t w a s g r e a te r t h a n in 1 9 6 7 a n d p r a c t i
in
c a lly t w ic e a s la r g e a s th a t o f 1 9 6 8 . H o w e v e r , th is
its w o rk fo rce. A t a b o u t th e s a m e tim e , t h e F e d
w as
eral
tr u e in
m o st
g ro w ers.
F a v o r a b le
u te d
an
to
cases
fo r
S o u th e r n
N ovem ber
e x c e p t io n a lly
good
pecan
e a r ly
1970
and
govern m en t an n ou n ced
ex
pecan
h a r v e st,
s e c o n d o f t w o c o s t - c u t t in g m o v e s w h ic h b e g a n in
1 9 6 9 th a n in
th e w in te r o f 1 9 6 9 .
In su m m a ry , e v e n
G e o r g i a ’s e c o n o m y
G e o r g i a ’s
it w ill s o o n jo g a lo n g a t a q u ic k e n e d p a c e — o n e
th a t, b a se d o n p a s t e x p e r ie n c e , w ill c o n t in u e to
tio n
b e f a s t e r t h a n t h e n a t i o n ’s.
c o n s id e r a b ly
A lth o u g h
th o u g h
is c u r r e n tly u n d e r g o in g a n a d ju s tm e n t, h o p e fu lly
o u tp u t in 1 9 6 9 e x c e e d e d o u tp u t in 1 9 6 7 , p r o d u c
r e m a in e d
1969.
of
p e n d itu r e s a t G e o r g ia m ilit a r y in s t a lla tio n s , t h e
R e d u c e d p e a c h h a r v e s t fo r th e C a r o lin a s a n d
in
r e d u c tio n
c o n tr ib
1968.
occurred
a
tr im m e d
w ea th er
o n e t h a t w a s 2 2 p e r c e n t la r g e r in
G e o r g ia
L o c k h e e d -G e o r g ia
b e lo w
th e
h ig h
of
1 9 6 8 . A m id -M a r c h c o ld sn a p , h o w e v e r , m a y p u t
E
a d a m p e r o n t h e 1 9 7 0 p e a c h o u tlo o k .
m erso n
A t k in s o n
B a n k A n n o u n ce m e n ts
On March 2, The B a n k of Collinw ood, Col Iinwood,
Tennessee; The B a n k of W aynesboro, Waynesboro,
Tennessee; M is s is s ip p i Southern Ban k, Port Gib
son, M ississippi; Peo p les B a n k of Clifton, Clifton,
Tennessee; and W ayne County Bank, Waynesboro,
Tennessee— all nonmember banks— began to re
mit at par for checks drawn on them when re
ceived from the Federal Reserve Bank.
Also on March 2, S e c o n d N atio n al B a n k of Delray
B each, Delray Beach, Florida, opened for business
as a newly organized member bank. Officers are
Marshall M. DeWitt, chairm an; Frederick J.
Teschke, president; Jesse M. Mikell, senior vice
president; Richard B. Alsaker, vice president and
cashier; and Helen M. Lee, assistant cashier.
A P R IL 1970
Capital is $300,0 00; surplus and other capital
funds, $450,000.
C itizen s B a n k of C larkston, Clarkston, Georgia, a
newly organized nonmember bank, opened for
business on March 6. Officers are Ted A. Murphy,
president; Hugh A. Horton, vice president; and
P. Wayne Kidd, cashier. Capital is $ 2 0 0,0 00;
surplus and other capital funds, $301,7 01.
On March 17, The T a lla h a sse e B a n k North,
Tallahassee, Florida, opened for business as a
newly organized nonmember bank. Officers are
T. N. Humphress, president; Gary C. Usina, execu
tive vice president; and John Harlee, assistant
cashier. Capital is $300,0 00; surplus and other
capital funds, $250,0 00.
57
S ix t h D is t r ic t S t a t is t ic s
S e a s o n a l l y A d ju s t e d
(A ll d a ta a re in d e x e s , 1 9 5 7 - 5 9 =
Latest Month
1970
One
Two
Month Months
Ago
Ago
One
Year
Ago
SIXTH DISTRICT
INCOME AND SPENDING
Personal Income
(Mil. $, Annual Rate
. Jan.
. Jan.
. Jan.
. Jan.
N.A.
252
175
153
203
N.A.
250
150
Instalment Credit at Banks* (Mil. $)
New Loans ............................................... . Feb.
. Feb.
122
202
N.A.
251
156
133
193
67,872
238
164
167
169
316
297
305
289
338
296
296
278
152
149
174
144
180
153
150
176
143
179
118
109
130
135
116
152
149
176
143
180
118
106
131
135
116
150
149
175
142
177
117
129
127
117
211
210
210
153
150
60
152
142
61
150
143
63
PRODUCTION AND EMPLOYMENT*
.
.
.
.
.
.
.
.
.
.
.
.
.
Manufacturing
F o o d ....................................................
Lbr., Wood Prod., Furn. & Fix.
Textiles ....................................
Transportation Equipment
Unemployment Rate
(Percent of Work Fori
Insured Unemployment
Avg. Weekly Hrs. in Mfg. (Hrs.)
Construction Contracts* . . .
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
Feb.
129
132
115
199
153
144
60
110
Feb.
3.8
3.6
3.5
3.3
. Feb.
. Feb.
2.3
40.0
246
246
246
166
103
236
2.3
40.3
439
318
542
167
103
232
1.9
40.8
292
332
258
166
98
238
2.2
. Feb.
Electric Power Production*
Cotton Consumption** . .
121
110
. Jan.
. Jan.
**Feb.
40.9
249
278
225
154
103
207
FINANCE AND BANKING
. Feb.
342
287
342
289
339
286
309
267
. Feb.
. Feb.
Feb.
225
185
280
225
186
276
238
199
268
224
191
255
ALABAMA ±
. Jan.
. Feb.
. Jan.
N.A.
218
193
N.A.
218
143
N.A.
216
131
8,440
.
.
.
.
,
Feb.
Feb.
Feb.
Feb.
Feb.
134
136
133
123
61
134
137
133
127
60
134
137
132
125
64
132
136
131
. Feb.
. Feb.
4.0
40.5
3.8
40.5
4.0
40.8
3.8
41.1
. Feb.
. Feb.
. Feb.
311
213
249
306
248
306
218
238
276
213
233
Jan.
Feb.
Jan.
N.A.
342
172
N.A.
335
172
N.A.
348
198
20,534
312
173
Feb.
176
177
177
172
201
150
PRODUCTION AND EMPLOYMENT
Nonfarm Employmentt . . . .
Manufacturing
..........................
Nonmanufacturing
. . . .
C o n s t ru c tio n ..........................
Farm Em ploym ent..........................
Unemployment Rate
(Percent of Work Forcejf . .
Avg. Weekly Hrs. in Mfg. (Hrs.)
122
64
FINANCE AND BANKING
Member Bank L o a n s.....................
Member Bank Deposits . . .
Bank D e b it s * * ...............................
210
INCOME
Personal Income
Farm Cash R e c e ip ts .....................
Latest Month
1970
Manufacturing
................................
Nonmanufacturing..........................
C o n s tru c tio n ...............................
Farm Em ploym ent...............................
Unemployment Rate
(Percent of Work Force)t • • .
Avg. Weekly Hrs. in Mfg. (Hrs.) .
One
Two
Month Months
Ago
Ago
One
Year
Ago
. . Feb.
, , Feb.
Feb.
. . Feb.
179
176
141
85
178
175
138
91
178
176
134
93
, , Feb.
. . Feb.
2.9
39.4
2.7
40.3
2.6
2 .6
41.4
41.6
. . Feb.
Feb.
. . Feb.
384
258
287
386
258
294
379
278
284
338
251
257
. . Jan.
Feb.
, Jan.
N.A.
257
201
N.A.
255
189
N.A.
271
160
13,162
247
171
Feb.
Feb.
Feb.
Feb.
153
141
158
150
52
154
145
159
155
56
153
145
157
151
59
146
144
153
154
54
Feb.
Feb.
3.5
39.9
3.0
39.6
3.1
40.5
41.0
Member Bank L o a n s .......................... . . Feb.
Member Bank Deposits..................... . . Feb.
Bank D ebits**..........................................
Feb.
347
229
340
348
229
317
347
242
307
328
249
287
Jan.
, Feb.
Jan.
N.A.
197
158
N.A.
199
136
N.A.
191
158
9.971
185
175
Nonfarm Employm entt..................... . . Feb.
Manufacturing
...............................
Feb.
Nonmanufacturing
.....................
Feb.
C o n s tru c tio n ...............................
Farm Em ploym ent....................................
Feb.
Unemployment Rate
(Percent of Work Force)t . . . . . Feb.
Avg. Weekly Hrs. in Mfg. (Hrs.) . . . Feb.
134
124
136
134
50
134
124
136
155
45
133
136
133
50
133
124
136
142
58
5.6
41.4
5.4
42.5
5.1
41.2
4.7
40.9
. Feb.
Feb.
Feb.
282
177
203
277
176
217
281
186
204
253
177
188
Personal Income
(Mil. $, Annual R a t e ) ..................... . Jan.
Manufacturing Payrolls.......................... . Feb.
Farm Cash R e c e ip ts ............................... . Jan.
N.A.
270
190
N.A.
274
118
N.A.
261
126
4,951
263
186
. Feb.
152
160
148
175
57
152
161
148
183
54
150
160
148
160
50
149
162
146
155
58
Feb.
. Feb.
4.3
40.0
3.9
40.9
3.8
40.7
3.7
41.1
416
271
300
425
277
284
408
279
264
375
254
254
180
170
132
95
FINANCE AND BANKING
Member Bank L o a n s ..........................
Member Bank Deposits.....................
Bank D ebits**..........................................
GEORGIA *
INCOME
Personal Income
(Mil. $, Annual Rate) . . . .
Manufacturing Payrolls . . . .
Farm Cash R e c e ip ts ..........................
PRODUCTION AND EMPLOYMENT
Nonfarm Employmentt
. . . .
Manufacturing
...............................
Nonmanufacturing.......................... . .
C o n s tru c tio n ...............................
Farm Em ploym ent...............................
Unemployment Rate
(Percent of Work Force)! . . .
Avg. Weekly Hrs. in Mfg. (Hrs.) . . .
2 .6
FINANCE AND BANKING
LOUISIANA
INCOME
Loans*
Personal Income
(Mil. $, Annual
I O O , u n le s s in d ic a te d o th e r w is e .)
PRODUCTION AND EMPLOYMENT
58
Personal Income
(Mil. $, Annual Rate) . . . .
Manufacturing P a y ro lls .....................
Farm Cash R e c e ip t s .....................
PRODUCTION AND EMPLOYMENT
12 2
FINANCE AND BANKING
Member Bank L o a n s * ..........................
Member Bank D e p o s its * .....................
Bank D ebits*/**..........................................
MISSISSIPPI
INCOME
PRODUCTION AND EMPLOYMENT
Nonfarm Em ploym entt..........................
Manufacturing
.....................................
Nonmanufacturing...............................
C o n s tru c tio n .....................................
Farm Em ploym ent.....................................
Unemployment Rate
(Percent of Work Force)t . . . .
Avg. Weekly Hrs. in Mfg. (Hrs.) . .
, Feb.
. Feb.
FINANCE AND BANKING
Member Bank L o a n s * ..........................
Member Bank D e p o s its * .....................
Bank D ebits*/**..........................................
M O N T H L Y R E V IE W
Latest Month
1970
One
Year
Ago
One
Two
Month Months
Ago
Ago
Nonmanufacturing...............................
C o n s tru c tio n ....................................
Farm Em ploym ent....................................
Unemployment Rate
(Percent of Work ForceJt . . . .
Avg. Weekly Hours in Mfg. (Hrs.) .
TENNESSEE t
INCOME
Personal Income
(Mil. $, Annual Rate) . . . .
Manufacturing Payrolls..................... . . Feb.
Farm Cash R e c e ip ts .......................... . . Jan.
N.A.
245
121
N.A.
242
116
N.A.
248
147
10,815
236
121
151
157
151
157
149
157
150
158
. Feb.
One
Two
Month Months
Ago
Ago
On*
Year
Ago
. Feb.
148
170
63
148
174
62
145
165
62
146
169
63
. Feb.
. Feb.
3.7
39.8
3.9
39.9
3.6
40.4
3.1
40.4
Member Bank L o a n s * .......................... . Feb.
Member Bank D e p o sits * ..................... . Feb.
Bank D ebits*/**.........................................
325
203
273
325
203
262
319
213
273
293
190
295
FINANCE AND BANKING
PRODUCTION AND EMPLOYMENT
Nonfarm Employm entt..................... . . Feb.
Feb.
Manufacturing ...............................
Latest Month
1970
r-Revised
*For Sixth District area only; other totals
for entire six
N.A.states
Not available **Daily average basis
tEmployment figures for Alabama, Florida, Georgia, and Tennessee have been adjusted to new bench mark data.
Sources: Personal income estimated by this Bank; nonfarm, mfg. and non mfg. emp., mfg. payrolls and hours, and unemp., U.S. Dept, of Labor and cooperating state
agencies; cotton consumption, U.S. Bureau of Census; construction contracts, F. W. Dodge Div., McGraw-Hill Information Systems Co.; petrol, prod., U.S. Bureau of
Mines; industrial use of elec. power, Fed. Power Comm.; farm cash receipts and farm emp., U.S.D.A. Other indexes based on data collected by this Bank. All indexes
calculated by this Bank.
D e b it s t o D e m a n d D e p o s it A c c o u n t s
In s u r e d C o m m e r c ia l B a n k s in th e S ix t h D is t r ic t
(In T h o u s a n d s o f D o lla r s )
Percent Change
February
1970
January
1970
February
1969
Year
to
February date
1970
2 mos
From
1970
Jan. Feb. from
1970 1969 1969
STANDARD METROPOLITAN
STATISTICAL AREASt
Birmingham
. . . .
1,875,881
Gadsden .....................
65,731
Huntsville . . . .
214,847
Mobile
.....................
574,749
Montgomery . . .
336,355
Tuscaloosa
. . .
115,338
2,011,268
70,472
236,079
672,506
386,720
129,262
1,706,222
57,541
168,182
540,854
361,645
112,129
- 7
- 7
- 9
-1 5
-13
-11
+ 10
+ 14
+28
+ 6
- 7
+ 3
+ 7
+ 8
+ 19
+ 9
- 1
+ 1
Ft. Lauderdale—
Hollywood . . .
Jacksonville
. . .
M ia m i..........................
O r la n d o .....................
Pensacola . . . .
Tallahassee
. . .
Tampa—St. Pete. .
W. Palm Beach . .
1,049,022
2,000,832
3,328,016
740,216
222,128
201,461
2,047,331
666,037
1,282,452
1,980,985
4,041,729
856,716
254,932
193,015
2,496,828
797,560
1,017,248
1,644,496
3,097,063
663,003
206,330
179,875
1,695,669
595,887
-1 8
+ 1
-1 8
-1 4
-1 3
+ 4
-1 8
-1 6
+ 3
+22
+ 7
+ 12
+ 8
+ 12
+21
+ 12
+ 7
+ 9
+ 10
+ 14
+ 7
+ 13
+ 18
+ 16
Albany
.....................
Atlanta
.....................
A u g u s t a .....................
Columbus . . . .
Macon
.....................
Savannah
. . . .
106,361
7,445,020
292,470
247,922
282,392
270,277
124,207
7,708,432
327,949
282,919
332,604
357,495
99,787
5,968,418
270,440
257,613
292,878
291,733
-1 4
- 3
-11
-1 2
-1 5
-25
+ 7
+25
+ 8
- 4
- 4
- 7
+ 8
+22
+ 7
+ 0
+ 2
- 1
Baton Rouge
Lafayette
. .
Lake Charles .
New Orleans .
. .
. .
. .
. .
757,320
154,679
157,684
2,497,335
891,666
184,699
192,231
2,974,312
645,205
140,995
152,976
2,357,991
-1 5
-1 6
-1 8
-1 6
+ 17
+ 10
+ 3
+ 6
+26
+ 3
+ 1
+ 6
Biloxi—Gulfport . .
Jackson .....................
164,522
871,804
158,581
864,755
117,892
692,561
+ 4
+ 1
+40
+26
+29
+20
Chattanooga . . .
Knoxville
. . . .
Nashville
. . . .
760,908
504,657
1,777,274
871,470
586,013
1,897,973
662,186
496,835
2,296,192
-13
-1 4
- 6
+ 15
+ 2
-23
+ 14
- 1
-2 2
A n n is to n .....................
Dothan
.....................
S e l m a ..........................
68,288
83,897
48,136
80,379
89,184
50,983
71,355
71,291
50,332
-1 5
- 6
- 6
- 4
+ 18
- 4
- 0
+ 15
- 3
.....................
Bartow
Bradenton . . . .
Brevard County . .
Daytona Beach . .
Ft. Myers—
N. Ft. Myers . .
35,716
99,370
199,880
94,128
49,175
114,391
269,981
117,082
37,465
95,284
218,094
88,082
-27
-13
-26
-2 0
+
+
+
125,732
146,096
128,788
-1 4
OTHER CENTERS
•Includes only banks in the Sixth District portion of the state
A P R IL 1970
5
4
8
7
- 2
4
2
7
8
- 1
tPartially estimated
Percent Change
February
1970
From
Jan. Feb.
1970 1969
Year
to
date
2 mos.
1970
from
1969
February
1970
January
1970
Gainesville . . . .
Lakeland
. . . .
Monroe County . .
O c a l a ..........................
St. Augustine . . .
St. Petersburg . .
S a r a s o ta .....................
Tampa
.....................
Winter Haven . .
107,148
161,296
43,299
95,699
21,459
414,495
197,822
1,126,085
89,987
117,729
190,555
42,867
105,970
27,811
518,958
211,768
1,343,323
106,736
98,161
134,481
38,875
73,776
23,632
393,962
148,272
890,050
82,573
- 9
-1 5
+ 1
-1 0
-23
-2 0
- 7
-1 6
-1 6
+ 9
+20
+ 11
+30
- 9
+ 5
+33
+27
+ 9
+12
+24
- 0
+30
- 8
+ 5
+26
+25
+ 17
Athens
.....................
Brunswick . . . .
Dalton
.....................
E lb e r to n .....................
Gainesville . . . .
G r if f i n ..........................
LaGrange
. . . .
Newnan .....................
R o m e ..........................
V a ld o s ta .....................
92,077
53,585
97,909
18.482
80,345
39,972
21,734
27,456
81,608
61,268
108,258
60,583
112,753
16,749
105,835
44,215
24,036
28,874
96,742
68,774
84,872
45,107
104,311
14,318
66,686
34,868
22,153
22,636
75,550
58,154
-1 5
-1 2
-13
+ 10
-2 4
-1 0
-1 0
- 5
-1 6
-11
+ 8
+ 19
- 6
+29
+20
+ 15
- 2
+21
+ 8
+ 5
+ 6
+ 14
- 9
+12
+28
+ 14
- 3
+ 17
+ 9
+ 9
Abbeville
. . . .
Alexandria . . . .
Bunkie
.....................
Hammond . . . .
New Iberia . . . .
Plaquemine
. . .
Thibodaux . . . .
11,657
149,761
6,318
44,688
37,487
15,040
23,519
18,134
179,255
9,166
44,979
47,715
18,472
35,321
11,570
158,502
6,792
39,003
38,671
13,674
21,741
-3 6
-1 6
-31
- 1
-21
-1 9
-3 3
+ 1
- 6
- 7
+ 15
- 3
+ 10
+ 8
+ 1
- 4
- 1
+ 9
+ 0
+ 13
+ 1
Hattiesburg
. . .
L a u r e l ..........................
M e rid ia n .....................
Natchez
. . . .
Pascagoula—
Moss Point
. .
Vicksburg . . . .
Yazoo City . . . .
52,698
45,502
70,507
39,384
58,595
55,295
85,509
45,232
65,256
42,658
69,615
42,646
-1 0
-1 8
-1 8
-13
-1 9 -1 9
+ 7 +21
+ 1 + 3
- 8 + 1
78,573
47,677
23,493
79,896
51,457
26,881
68,150
38,901
31,787
- 2
- 7
-13
+ 15
+23
-25
+ 4
+ 13
-2 4
Bristol
.....................
Johnson City
. .
Kingsport
. . . .
83,981
91,964
156,624
94,967
103,101
172,872
77,870
79,192
173,592
-1 2
-11
- 9
+ 8
+ 16
-1 0
+ 6
+ 12
- 8
39,413,017 44,339,165
5,201,051
4,678,452
13,040,154 15,232,468
10,730,806 11,485,262
5,362,228
4,497,183
1,926,278
1,817,018
4,649,404
5,131,878
35,864,276
4,376,244
11,683,239
9,068,961
4,174,360
1,538,287
5,023,185
-11
-1 0
-1 4
- 7
-1 6
- 6
- 9
+ 10 + 10
+ 7 + 7
+ 12 + 12
+ 18 + 16
+ 8 + 8
+ 18 + 15
- 7 - 8
SIXTH DISTRICT, Total
Alabama?:
. . . .
F lo r i d a ? .....................
Georgia):
. . . .
Louisianat*
. . • .
Mississippi?* • • ■ .
Tennesseet* . • . .
{Estimated
February
1969
r-Revised
59
D is t r ic t B u s in e s s C o n d it io n s
As new data appear, their message is unm istakable: Econom ic slowdown continues. February brought
declines in nonfarm employment and in the m anufacturing workweek. The unemployment rate rose
again. Consumer credit activity increased only marginally. Auto sales remained sluggish. Bad weather
beset farmers. Sharp gains in specific markets, nevertheless, put plus signs in front of January
construction contract indices. In banking, the March prime rate reduction accompanied a lessening
of reserve pressures, a lessening caused partly by rebounding consumer-type time deposits.
February employment indicators document the
slowdown. N o n f a r m e m p l o y m e n t f e l l a g a i n , c a u s
reduce
to b a cco
acreage.
P r ic e s
of
m o st
fa r m
p r o d u c ts a r e h o ld in g u p w e ll.
L a y o ffs , r a th e r th a n n e w e n tr a n ts in to th e w o r k
Construction data show gains that look boomy,
but these were concentrated in only a few markets.
in g th e u n e m p lo y m e n t r a te to in c r e a s e o n c e m o re.
fo r c e , r a is e d t h e u n e m p lo y m e n t r a te . T h e a v e r a g e
A la b a m a a n d
m a n u fa c tu r in g w o r k w e e k , a s ig n if ic a n t e c o n o m ic
c o n s tr u c tio n
b a r o m e te r , f a ile d to in c r e a s e in fo u r o f t h e fiv e
fic ie n tly
sta te s
r e p o r tin g .
( In
th e fifth
th e in c r e a s e w a s s m a ll.)
up
s lig h tly
in r e s p o n s e
s t a t e — G e o r g ia —
D o lla r p a y r o lls m o v e d
to
c o n tin u e d
w age
in
creases.
a u to s a le s r e m a in e d in lo w g e a r d e s p it e in te n s iv e
m a r k e tin g e ffo r ts b y
th e a u to
in d u s tr y . I n d ic a
tio n s a r e th a t d e p a r tm e n t s to r e s a le s c o n tin u e d
th e ir s lu g g is h p a c e in M a r c h .
Weather hit fruit and vegetable crops with a
one-two punch, as an unusually warm spell gave
way to freezing temperatures. T h e f r e e z e n i p p e d
o ffse t sh arp
c o n s tr u c tio n
in
January,
d e c lin e s in
e ls e w h e r e .
Sharp
la r g e p la n t
w h ic h
su f
n o n r e s id e n tia l
r e s id e n tia l
con
s tr u c tio n d e c lin e s in L o u is ia n a , M is s is s ip p i, a n d
A la b a m a w e r e m o r e th a n m a d e u p b y c o n t in u e d
g a in s in
Outstanding consumer credit at commercial
banks inched upward in February, largely because
of increases in two categories— personal loans
and auto loans purchased from dealers. F e b r u a r y
T en n essee an n ou n ced
c o n tr a c ts
F lo r id a .
S tr e n g th
co n cen tra ted — th e
so n v ille , a n d
W est
la r g e in c r e a s e s in
in
T a m p a -S t.
P a lm
F lo r id a
w a s a ls o
P e te r sb u r g ,
B each
areas
Jack
r e p o rte d
c o n tr a c t v o lu m e . T h e
s in g le
fa m ily r e s id e n tia l c o n s tr u c tio n se c to r is s t ill r e
s t r a in e d b y th e s h o r t a g e o f m o r tg a g e c r e d it, h o w
e v e r , a n d p r e lim in a r y d a ta in d ic a t e t h a t s a v in g s
flo w s
in to
m o r tg a g e -o r ie n te d
th r ift
in s titu tio n s
in c r e a s e d v e r y l it t le in F e b r u a r y .
A prime rate reduction to eight percent was
the big banking news in March; almost all major
banks have joined in the national markdown.
In
F ebruary,
th e
in te r e s t
ra te
on
sh o r t-te r m
m a n y e a r ly p e a c h v a r ie t ie s in th e b u d , a n d it a ls o
b u s in e s s lo a n s a t la r g e D is t r ic t b a n k s
d a m a g e d L o u i s i a n a ’s t e n d e r y o u n g s t r a w b e r r i e s .
changed
W h e r e i t w a s n o t c o l d , i t w a s w e t : B e a t i n g r a in s
h a v e b e e n u n d e r le s s r e s e r v e p r e ssu r e , p a r tly b e
cau sed
cau se of a M arch
e r o s io n ; h e a v y
m o is tu r e im p e d e d
sp r in g
fro m
R e c e n tly ,
r e s u r g e n c e in
in g s
th r o u g h th e m id -M a r c h c o r p o r a te ta x d a te .
so y b ea n s,
60
and
p e a n u ts
and
to
dem and
la tte r
c o n su m e r -ty p e
t im e
c o tto n ,
Loan
w as un
th e
p la n tin g . D is t r ic t fa r m e r s p la n to in c r e a s e p la n t
of
d e p o s its .
N ovem ber.
r e m a in e d
stro n g
MONTHLY REVIEW
APRIL 1970
@FedFRASER