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Radio Address byChester C. Davis
KSD -- 10:20-10;30 P.M.
March 26, 1943

At this time, KSD presents a farewell message to his fellow citizens of
St. Louis by Chester C. Davis, President of the Federal Reserve Bank,
Eighth Federal Reserve District, who leaves tomorrow for Y^ashington to
assume his new office as Administrator of Food Production and Distribution. Mr. Davis:

MR, DAVIS: Good evening.

To say that I regret leaving St. Louis at this time, even

temporarily, is an understatement. No man in his right mind would take
joy out of laying down an unfinished job which ho was- enjoying, to take
up such a task as confronts me now.
There isn't much I want to say about the new job that awaits me
in Washington, beyond asking that we all calm down our attitudes on this
food problem; that wo depend on the American farmer to do his level best
for us, as he will surely do*
On top of that — pull for a good season for the farmer.


will bo a boon for all of us, for our allies, and for the great cause
that we must and shall win*
As the grim doadlinoss of this war comes closer home to us, it
is all the more evident that we -- all of us — have to make adjustments
in our way of life. But those adjustments area1t made any easier by
getting excited about them.
needs to be done —

In a spirit of calm resolve we can do what

and it is that spirit, I am convinced, that will

prevail as we go ahead on our course to ultimate victory.
As I prepare to leave for my new task, however, my thoughts are
still on the job hero -- the job wo all face in April.

It is the job of

financing the war, and it is something very close to my heart.

At first thought, it might appear that there is little connection between
my new assignment and the responsibility we all have of financing the war. Yet,. I
believe you will sec there is a rather closo connection when it is recalled that
our success in assuring an adequate supply of food at fair prices for the basic
needs of the country depends in no small measure upon our ability to place our war
effort on a sound and adequate financial basis.
That is the objective of the Second War Loan in April — the great campaign
in which every citizen of St, Louis, as every citizen of every other community in
America, has a direct responsibility.
of goods —

and about prices.

Wo are all greatly concerned about supplies

Our country is bending every effort toward increased

production of armaments and other supplies needed for our armed forces and for the
fighting armies of iur allies. At the same time, every effort is being made to
maintain supplies sufficient for essential civilian needs.
The public is placing a greet deal of rulianco upon direct control of
prices as the means for preventing increases in the selling cost of these essential
civilian goods.
Yet —

in my opinion — more than direct controls, more than governmental

orders to hold prices to their proper level, more than price directives and appeals
will bo needed if we are to prevent runaway prices which v/ould cause cruel hardships
on all elements of our population.
Let me try to give you the picture as I see It,
1943, the national income —

It is estimated that in

the payments to individuals — will total one hundred

and thirty five billion dollars. An income of that size is inevitable if we roach
the war production goals we have set for ourselves.
This money is not disappearing into a void,

v i o the Government spends

money for airplanes, ships, tanks, ammunition and other tools of war -- these
dollars are going into the hands of business, and is then distributed as wages or
costs of raw materials — going into the pockets and bank deposits of individuals.

The big problem before tho Government is to see that tho available civilian
goods are distributed equitably among tho population —
tion, prices t ro held down within reason.

and that in such distribu-

This cannot be done if there is a bidding

among individuals for tho goods available — bidding that will be inevitable if
every man and woman who has this surplus money trios to spend it.
The t ic what will send prices up —

to the inevitable harm of every one of

All the orders or directives in the world won't stop it — unless we, tho

people, do th* one thing necessary to prevent it happening,

That power does lie

within our hands -- and in April, we must exercise it by using the Second War Loan
as the outlet for this money that otherwise v/ould go to bid up prices in the long
and vicious spiral that leads to runaway inflation.
On the basis of tho present tax structure, only about fifteen billion of
the one hundred and thirty-five billion dollars of income will be paid in taxes.
Another eight billion wrill go for insurance premiums, debt retirement, and
similar forms of savings.
About seventy-seven billion dollars worth of goods and services will be
available for civilian consumption -- figured at the present level of prices.
Figure it all up, and you still find a surplus of thirty-five billion dollars in tho hands of the general public.
That thirty-five, billion dollars is the key to our success or failure in
avoiding inflation.

If we use it to bid . g. inst each other for goods rnd services,
• -

no power on earth can hold price ceilings in place.
the top of an erupting volcano —

Those ceilings will blow like

and wo all will suffer in the ruin that follows.

On the other hand — these same thirty-five billions of surplus dollars
can be a tremendous force in fighting the war and in holding down prices.
The Government could draft all of these surplus dollars through taxes. Or
you, the citizen, can enlist them by purchase of government securities.

The latter

course of voluntary action is the course we all can take in April during the Second
Tia Loan Drivo.

I am particularly sorry to leave St. Louis at this time when this city, and
the Eighth Federal Reserve District of which it is a part, are about to undertake
the responsibility of this Second War Loan Drive.
thirteen billion dollars —

The national goal in April is

of which eight billion is to come from non-banking

We all agree, I am sure that these thousands of volunteer workers in this
drive will receive a patriotic welcome.

Those workers —

and I know I am talking

to many of them over the air now -- are devoting their time? without pay to this
vital war cause.

To them all, I say —

a salute for the great war-winning job I

know you will do. And to all of you who v.dll receive them and respond to their
appeal —

a salute for the way in which I know you will do your part in making St.

Louis the first major city —

and the Eighth Federal Reserve the first district --

to go over the top in April.
As I leave for another phase of the war effort on the home front, I take
satisfaction in knowing that the big task here is in capable hands -- with Walter
W. Head as General Chairman of the Metropolitan St. Louis division -- Chapin S.
Newhard as Campaign Chairman —

and the thousands of devoted and loyal men and

women — your follow citizens — who will carry this job through to completion and
glorious success. An amazing j cb of thorough organization already has been done.
An even greater job of carrying it through to final success will be done -- so that
by the end of April, even though I will be immersed then in new responsibilities, I
can sit back for a moment or so rt least and say to myself, "St. Louis did it — did
it again, as it always does."


You have just heard a short talje by Mr. Chester C. Davis, who takes up his
new duties Monday in Washington as Administrator of Food Production and