INFLATION: Small Weapons for the Two-Front War

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After a dozen highly publicized "summit" meetings, innumerable agitated sessions with his official advisers and countless private talks with old friends, President Ford said that he was ready at last to "bite the bullet" on the economy. But the program that he presented last week to a nationally televised joint session of Congress was more balm than bite, and not a great deal of either.

The basic policy was essentially unchanged from that which Ford inherited from Richard Nixon last August—a federal budget with spending held at or below $300 billion and a fairly tight monetary policy.

To his credit, the President did not try to deal with the economy's incredibly complex problems in a demagogic fashion by promising simple solutions where none exist. As expected (TIME, Oct. 14), he called on Congress to pass a modest 5% tax surcharge on some individuals and all corporations, and he asked for additional tax credits to stimulate investment and industrial expansion. But there was much less tax relief for the poor than had been expected.

Following his conservative instincts, he turned aside insistent advice for direct Government intervention and appealed instead for voluntary action to cut demand—and prices—for food and fuel.

Recruiting Effort. "Grow more and waste less," he urged. "Drive less, heat less." Wearing a red-and-white lapel button reading "WIN"—for Whip Inflation Now—he called "upon every American to join in this massive mobilization and stick with it until we do win as a nation and as a people." At White House request, newspapers the next day printed an enlistment form for "inflation fighters"; the first 100,000 people to fill out the form and mail it to the White House will get a free WIN button.

At every turn, Ford found himself fighting a two-front war. Clamping down hard to restrain the inflation threatening the financial fabric of the nation could tip the economy into a deep recession.

Doing battle with the recession that now grips the nation could doom the fight against inflation. A gasoline tax could limit driving and cut demand for costly imported oil, but raising the tax would boost retail prices and make inflation even worse.

Curtailing oil imports directly by imposing quotas would help pressure the oil-exporting nations to lower their prices, but that move could also send economic activity downward.

Congress, which had welcomed the President warmly to the House chamber he knows so well, greeted his proposals with a cool skepticism. Legislators wondered if the suggestions, in the eyes of the American people, would constitute much of the "leadership" and "action" that the President rightly said they yearn for. Even within the Administration, some officials found it hard to muster more than faint praise for the end product of so much public and private soul searching. Federal Reserve Chairman Arthur Burns, who favored more wage-price jawboning and a bigger public service employment program than Ford proposed, said, "It is a well-balanced program. Whether it goes far enough as a whole or in individual directions is a complicated question that members of Congress may well answer differently. But I think it is a useful beginning toward the rebuilding of confidence."