Washington-U.S.A.

...plans for the development of natural resources so that this leisure-time generation can enjoy some of the nation's scenic and cultural heritage without first enriching a developer who happened to get to the seashore, the mountain or the lake first with the most money...

...It is of course true that the American economy is not nearly so affluent as Galbraith and others have made it out to be...

...The needs of the economy must first be assessed, and then the direction as well as the speed of growth ought to be directed so that the needs will be met...

...slum clearance programs that will do more than shift slum dwellers from one set of decaying buildings to another...

...a rural resettlement program that will move farmers from the poverty that poor land breeds to a better and more productive life in town...

...A hopeful few maintain that the revenue could easily be found if the Government would close such loopholes as the 27.5 per cent oil depreciation allowance and would also do a better job of collecting taxes that are due the nation under a fair and strict interpretation of the tax laws...

...If the rest of the 1960 report of the President's Council of Economic Advisers were as realistic as the foreign trade sections, perhaps the document would have created more of a stir in the capital...

...This year's report, in fact, revealed nothing new either in the way of conservative economic dogma or in legislative proposals...

...Growth for growth's sake is of course no more of an adequate economic policy than is the discredited bromide that private spending is more desirable than Government expenditures...

...The President's economic advisers do concede that "many public programs make important contributions to growth, both directly by increasing the productive capacity of individuals and business firms and indirectly by facilitating and encouraging the greater private investment that enlarges our capacity for future production...

...There is a disappointing reluctance on the part of many of the Administration's critics in Congress, as well as among economists, to recognize the importance of expanding the public sector of the economy...

...A prosperous year does wonders for revenues, as President Eisenhower discovered when the Budget Bureau began preparing estimates for the 1961 fiscal year...

...The more sophisticated critics of the Administration's economic philosophy note that the growth rate has probably not been fast enough...

...The economic advisers calculated in their report that since 1946, when the Employment Act established the Council, "the nation's output of goods and services, as well as its personal income, has increased by more than 50 per cent, or at a rate of 3.2 per cent per year...

...and Senator Hubert H. Humphrey (D.-Minn...

...This may be good, the critics respond, but it is not good enough...

...and the output of the private sector of the economy has advanced at a slightly higher rate, 3.5 per cent...

...As the economy glows, of course,—whatever direction that expansion might take—the amount of revenue raised under present tax rates will increase...

...The economic report, for example, argues from the classical conservative assumption that private spending is almost always preferable to public spending...

...The annual increase of 3.2 per cent in total national output, which corresponds to a doubling every 22 years," the advisers note, "is roughly equivalent to the long-term average reached in our previous history...

...they go on to point out that the kind of growth is more important than growth itself...

...What is needed, the advocates of greater public spending believe, are modern schools...

...Nevertheless, the report merits careful reading and consideration because it is a comprehensive statement of one side of an economic debate whose outcome will affect the lives of every American during the 1960s...

...This reluctance to take the growth debate out of the narrow context of percentage points and place it in the arena of needs is a reflection of the fear that the Government can do more only if tax rates are raised substantially...

...As he has in so many other areas, Vice President Richard M. Nixon has been careful not to commit himself totally on one side or the other of the growth debate...

...The growing debate is over the growth itself...

...better highways...

...The watchdog of the nation's economy often acts like a frightened pup...

...But the reply of people like Keyserling, economist John K. Gal-braith of Harvard and the members of Congress who believe the emphasis should be placed on more public spending is—what are the needs of today's economy...

...among the candidates for the Demo-cratic nomination, have indicated that they would make economic growth as well as its direction one of the key issues in their 1960 political campaigns...

...improved transportation systems to move commuters in and out of our growing cities...

...The critics of the Eisenhower Administration who have maintained that its economic and fiscal policies have stunted the growth of the American economy since 1953 often speak as if they advocate doing almost anything simply to keep abreast of the Soviet rate of growth or some magical growth figure of, say, five per cent a year...

...But the Council puts a heavy burden on the advocates of public spending to prove their case conclusively...

...But if he is elected President, he can be expected to move almost as cautiously in the area of Federal spending as Eisenhower has done...

...Under President Eisenhower the Council seems to have deteriorated into just another clump of bureaucratic underbrush which has neither the influence nor the drive that the members of Congress anticipated when they approved the Employment Act within a year after the end of World War II...

...Here is yet another encouraging indication that the Administration has no thoughts of retreating to the discredited standard of protectionism to reduce the balance-of-payments deficit...

...Both Senator John F. Kennedy (D.-Mass...

...Of course, the argument has been developed by such people as Leon H. Keyserling, Chairman of the Council of Economic Advisers under former President Harry S. Truman, almost since the day the Eisenhower Administration took office...

...Coming as it did after the State of the Union and budget messages, the report inevitably contained few surprises...

...For the first time in the 14-year history of the economic reports, the 1960 review devotes a special section to an extended discussion of the $4-billion deficit in the international balance of payments of the United States...

...Nevertheless, much of the effort that is necessary to raise the standard of living of such groups as Negroes and Puerto Ricans in the cities, and of white and Negro farmers trying to scratch a living from dusty and unproductive land in the North as well as the South, can only be accomplished by Government action...

...But discussion has become intensified in recent months as the need for expanded public spending has become as obvious as the race for world supremacy between the United States and the Soviet Union...

...The Administration's attack on the foreign trade deficit is characteristically devoid of much imagination, but it has been encouraging to critics of Eisenhower's economic policies to note the President's apparent determination to expand world trade...

...Higher minimum wages, the appropriation of more funds for attacking the causes of the poverty that keeps public welfare rolls high, the expansion of programs to help persons in the lower-income and middle-income groups to obtain adequate housing, the use of Federal funds to improve schools—all these and many more programs can be carried out only by the Government...

...The President, his Secretary of the Treasury, Robert B. Anderson, and now his Council of Economic Advisers led by Chairman Raymond R. Saulnier are squarely on the side of encouraging more private spending and discouraging, if not actually cutting back, Government appropriations...

...They hold that only public enterprise can cope with the most pressing problems the United States must meet if it is to grow in such a way as to overcome the genuine rather than the artificially stimulated deficiencies of the 1960s...

...They are surely not still larger and gaudier cars, more cavernous refrigerators with perhaps motor-driven revolving shelves, three or four television sets to a home instead of one or two, elaborate supermarkets to increase further the spread between farm and consumer prices, or even fancier shopping centers to create bigger and better traffic jams on Saturday mornings...

...One area of the private sector of the economy which needs to be expanded, and quickly, is foreign trade...