THE ECONOMY: The World's Crisis

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Continuing Vigil. To some economists last week it seemed that inflation in the U.S. was just about licked. Noting declines in industrial expansion rates and stock-market prices in the U.S., Sweden's Per Jacobsson, managing director of the International Monetary Fund, told the World Bank-IMF conference that the U.S. "has arrested its inflation" (see BUSINESS). And Harvard Economics Professor Sumner H. Slichter, a "limited inflationist," noted critically that in putting "stability ahead of growth," the Eisenhower Administration had made "the most important economic decision since the Roosevelt Administration decided to aid workers in bargaining with employers."

The two top officials concerned with managing the U.S. economy both spoke up for the tight-money policy. Treasury Secretary Robert B. Anderson in a speech to the World Bank-IMF meeting noted that the U.S. is "gaining in the battle of inflation," but stressed "the continuing vigil we must keep to attain economic growth along with, and based on, sound money." Federal Reserve Chairman William McChesney Martin warned that nations yielding to inflation "will not have a higher standard of living but a lower one."

Unmistakably agreeing with Anderson and Martin, the American Bankers Association, meeting in Atlantic City, voted a resolution calling upon the Government to keep up its fight against, inflation. In a speech to the bankers, U.S. Steel Corp.'s Board Chairman Roger M. Blough urged a two-point anti-inflation program to supplement Government policies: 1) efforts by management and labor to increase productivity, and 2) restraint by both to keep wage rises from outpacing productivity. In effect, Blough was restating Dwight Eisenhower's theme: in a free economy, the Government cannot defeat inflation without help from business and labor. And help is urgently needed.