CONTENTS Letter of Senator Paul H. Douglas requesting submission of comments on the 1964 Economic Report of the President. List of organizations to whom letter was sent__ Page VI JANUARY 1964 ECONOMIC REPORT OF THE PRESIDENT The following letter was sent to 19 organizations inviting them to submit written comments on the materials and recommendations contained in the 1964 Economic Report of the President. The comments were given consideration by the Joint Economic Committee in the preparation of its annual report on the President's Economic Report: JANUARY 9, 1964. DEAR MR. Because of the pressure of the legislative calendar, and a statutory deadline of March 1 for filing our annual report, our schedule of hearings on the 1964 Economic Report of the President has had to be shortened. Therefore, the Joint Economic Committee is calling upon a number of leaders of banking, business, labor, agriculture, and consumer organizations to secure written statements of economic facts and counsel for consideration in the preparation of its report. We would appreciate having your comments on the materials and recommendations contained in the 1964 Economic Report of the President, including the annual report of the Council of Economic Advisers. In order that the members of the committee and staff may have ample time to consider these written statements, they should be received no later than February 5. If you are willing to prepare such a statement, please let us know so that we can send you a copy of the President's Economic Report by the 20th of this month. We will also send you a list of the others participating. It would be of assistance to the committee if we could have 20 copies of your statement for distribution to the members of the committee and the committee staff. Such comments as you care to give us will be made available to the public through a printed volume of the invited statements. Faithfully yours, PAUL H. DOUGLAS, Chairman. V Listed below are the organizations which were invited to submit written comments: American Bankers Association. American Farm Bureau Federation. American Federation of Labor & Congress of Industrial Organi zations. Chamber of Commerce of the United States of America. Committee for Economic Development. Conference on Economic Progress. Consumers Union. Federal Statistics Users' Conference. National Association of Mutual Savings Banks. National Farmers Union. National Federation of Independent Unions. National Grange. National League of Insured Savings Associations. United Mine Workers of America. United States Savings & Loan League. VI JANUARY 1964 ECONOMIC REPORT OF THE PRESIDENT THE AMERICAN BANKERS ASSOCIATION INTRODUCTION The American Bankers Association is in strong agreement with the objectives of national economic policy which are enunciated in the 1964 Economic Report of the President. Improvement in the Nation's balance of international payments, avoidance of inflation, a stronger and more productive private economy, expansion of job opportunities, and further progress in reducing the incidence of individual poverty are, indeed, the worthy objectives toward which the Nation should strive in 1964. Agreement on these objectives does not provide, however, a basis for agreement as to how the instruments of national economic policy should be used to attain the desired ends. Traditionally, both in the United States and abroad, policymakers have experienced considerable difficulty in devising short-term policies which make maximum and simultaneous contributions to these objectives. These difficulties reflect neither deficiencies in man's wisdom nor the special characteristics of free-enterprise economies. Many of the same difficulties are present, in fact, in Socialist and Communist countries. The difficulties reflect, instead, the fact that policies which are the most productive of short-term gain can also be highly destructive of long-range potential. Recognition of this fact is a fundamental requirement for the determination of sound economic policy, for it highlights the importance of distinguishing between economic expansion which is attainable in the short run and expansion which is sustainable in the long run. Unless a nation's policymakers draw this distinction and use it as a standard against which policy recommendations are measured, the longer range economic well-being of the public is likely to be mortgaged for an interim period of high-level prosperity. Few of the Nation's citizens knowingly would approve of such a bargain, and responsible governments do not knowingly strike it. Nevertheless, the initiation of boldly expansionary policies generally involves the risk that seeds of future economic instability may be sown. In examining the economic program outlined in the Economic Report of the President (and in the appended Annual Report of the Council of Economic Advisers) we have paid special attention to the need for assessing and minimizing these risks. We bring to our analysis of the administration's reports the following assumptions: 1. Economic expansion in 1964, however spectacular it may be, will impose severe hardships on the American people if it is secured through means which jeopardize improvement in the Nation's balance of payments and thereby threaten the stability of the international monetary system. Should this consequence |