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Radio Talk over
Station W-B-L -N,
Buffalo, New York.
Today is "I am an American Day" in Buffalo and Vestern New York. It
is a day of rejoicing and thanksgiving for all those who believe in the
American way of life. It is also a day for sober reflection upon our
duties and responsibilities as American citizens. lie have, among others,
a duty to help maintain and increase the freedom and opportunity that
are ours. To do so, we must keep ourselves informed about the many
"political, social and economic problems with which our country is faced.
The major economic problem is that of maintaining a high level of
production and employment and an equitable distribution of the products
of our industry. Achievement of these economic goals requires that we
avoid inflation or deflation—that we strive for the maintenance of
economic stability.
There are several obstacles to the achievement of economic stability at present high levels of economic activity and prosperity. One of
the greatest obstacles, which we must in some way surmount, is that of
providing jobs for all those who are seeking work. At the present time
almost 60,000,000 people are employed on farms, in factories, or in the
armed services. At the same time, the number of unemployed is 3,500,000.
Compared with February of this year, when the number of unemployed
totaled nearly 4,700,000 there has been a substantial improvement in the
past two months. However, the extent of the improvement is not quite as
great as these figures might suggest.
Every year we find more young men and women joining the labor force
than we do older people leaving i t — a t the present time the net addition is about 600,000 people a year. If all the people who want to work
are going to have jobs next year and the year after the total number
employed will have to be substantially larger than it is at the present
time. That is a pretty big order, finding jobs to keep more than
60,000,000 people employed. It is going to require a great deal of
effort on the part of everyone to keep our economic machine running
smoothly and efficiently enough to provide all those jobs.
Furthermore, it seems clear that the country has gone a long way
towards satisfying the more pressing postwar needs for plant and equipment, automobiles, and houses. This means that the backlog of demand
for such goods is growing smaller. During 1949 farmers harvested bumper
crops and the effect of these bumper crops was to depress the price of
farm products. This is in accord with the principal of supply and demand and helps to explain why prices received by farmers declined about
13 per cent during 194-9• Prospects for the coming year are that crops
may be smaller, as a result of unfavorable weather and Federal acreage
restrictions, and that prices, will be steady, or somewhat higher.
Wholesale prices of all commodities, after declining steadily
through most of 1949, have been inching upward in recent months and are

now about 2 per cent above the level of last December. Meanwhile, disparities among prices of individual commodities still exist; the price
of lumber, for example, is about three times what it was ten years ago,
while the average price of other building materials is somewhat less
than twice what it was just before the war. Such price disparities as
these necessitate adjustments to achieve a proper balance that will
assure economic stability. It takes time to work out these adjustments
and meanwhile business is slowed down by the process.
A great many things are bought on credit these days—automobiles,
houses, furniture, television sets—to mention but a few of them. During the oast twelve months, the total amount of consumer credit alone-excluding mortgage credit for the purchase of homes—has increased by 3
billion dollars, or roughly 20 per cent. That is all right as long as
personal incomes remain at their present high levels. But think, for a
moment, what would happen if the amount of income should suddenly decline. A great many people would be so busy paying for automobiles and
television sets which they bought this year or last that they would_not
have much left over for the purchase of new furniture or a new washing
machine. In other words, much of the demand that is currently based on
credit might suddenly disappear, and in so doing cause unemployment and
further curtailment of incomes. I do not mean to imply that I think such
a thing is going to happen now or in the immediate future, but it is
something we have to think about and be prepared to deal with.
While there are, and always will be, problems that require a solution, the economy is fundamentally sound and vigorous. The extent of
the recovery from last year's moderate recession in business activity
is striking. Mew housing starts totaled 110,000 units in March—the
largest number for any single month in the postwar period, and nearly
two-thirds higher than a year ago. Industrial production has i n c r e a s e d
16 oer cent since July 1949. People are buying automobiles at a
greater rate than ever, and prospects are that 1950 will be a year of
record automobile production.
In the longer run the development of new products and the e x p l o i t a tion of new resources give promise of further rise in our standard of
living. Those of you who remember the first years of our present century
have only to think of the changes that you have seen in your lifetimes
to appreciate what the next forty or fifty years may bring.
So far, I have spoken only of,conditions within the United States,
but it is obvious that conditions outside the United States must also
be considered. We have been exporting large quantities of goods abroad
ever since the war, and those exports have been an important element in
American production. If, in the near future, any great change occurs
in the amount of exports we send abroad or in the amount of imports we
purchase, it is inevitable, of course, that American business will be
affected by the change. But the change, in the long run, should be to
the good. It provides a proper balance in international payments and
eliminates need for our government gifts and loans.
Up to now, the aim of European countries has been to rebuild their
factories and regain their markets. Our aim has been to help them, so
that they can again stand on their own feet. But an essential feature
of the program of European recovery is that the United States buy a
larger amount of foreign products than it has in the past. This is

simply another of the possible changes to which American business may
have to become adjusted. Like most adjustments, it will involve
practical difficulties, particularly with respect to those American
products with which imports from abroad will directly competej but
actually the needed increase in imports is only a very small fraction
of our total trade.
While these foreign problems are primarily economic, their solution may influence our political as well as our economic welfare. At
the present time, we may reap indirect political benefits from economic
well-being abroad. Our defenses are stronger if foreign countries are
better off economically as well as politically. They are thus less
likely to succumb to the lures of a totalitarian form of government and
also better able to defend themselves against economic aggression.
As you can well appreciate, maintenance of economic stability at
home and political stability abroad is a difficult and complex task.
The accomplishment of this task depends largely upon the understanding,
cooperation and assistance of each and every one of us. From time to
time we may be called upon to contribute more directly to the accomplishment of this task—by serving in the armed forces in time of war
or national emergency, by donating our time and services to various
civic and national causes, or by investing a part of our savings in Government bonds.
Right now a savings bond drive is taking place. The slogan so
aptly chosen for this drive is "Save for Your Independence: Buy U. S.
Savings Bonds." Thus we are reminded that by buying United States Savings Bonds we not only supply the Government with funds to do its job
at home and abroad, but help ourselves personally. In short, we are
being asked to invest in America's economic future, and I, for one, am
confident that the future will be bright'.