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Farrell Dobbs

Exposes Truman on Inflation

Calls for Escalator Wages, Mass Consumer Committees
and Nationalized Industries

(6 August 1948)

Source: The Militant, Vol. 12 No. 32, 9 August 1948, pp. 1 & 2.
Transcription & Mark-up: Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

The following is the text of the radio address by Farrell Dobbs, Socialist Workers Party candidate for President, delivered over the national network of NBC on Friday evening, Aug. 6. NBC granted the radio time to Comrade Dobbs to reply to Truman’s Message to Congress.

I want to begin tonight by thanking President Truman for calling the Special Session of Congress. By this one action he has done more to expose the deceit of the Republican and Democratic election platforms than I could in a hundred speeches.

The voters of America are watching the political sideshow in Washington where the performance of both parties is again proving their subservience to the monopolies and their cyiiical disregard for the welfare of the working people.

When this special session ends, the Negro people will remain an oppressed minority, still deprived of their civil rights, still the victims of discrimination and lynch law. The Republicans and the Northern Democrats quickly surrendered to the White Supremacists on the poll tax issue. The Senate filibuster could easily have been smashed. But the capitalist politicians actually welcomed the filibuster as a pretext to abandon their civil rights promises to the Negro people.

Truman is a party to the farce and scandal of the Special Session. By a stroke of the pen he could have eliminated discrimination in the army and the national capital. His presidential order leaves segregation – the worst form of discrimination – intact in the armed forces.

Graft, Not Housing

The homeless veterans, the slum dwellers, the inhabitants of congested flats will get no relief from this Special Session of Congress. Some substitute for a housing bill may be passed before adjournment. But it won’t even be the Taft-Ellender-Wagner Bill to which both parties are committed. That bill made a feeble gesture toward a public housing program by calling for five million housing units although twenty-five million are needed right now.

If any housing bill comes out of this Congress, it will not, contain any provision for government built low-rent housing, nor for slum clearance. But it will guarantee more fat profits to the building trust for the construction of homes for the well-to-do. That’s not housing – it’s graft.

An effective housing program must begin with the nationalization of the building industry and its operation under control of the workers. This program should be operated through a government planning board of architects, engineers and representatives of the Workers in the building trades. It should be financed with the billions now being spent for war preparations.

Congress was called back to Washington. to do something about inflation. But whatever bill it does or does not pass, this much is assured: prices will be higher on the day Congress adjourns than they were on the day it convened. The Truman Democrats and the Dewey Republicans cannot and will ndt do anything about the high cost of living because they cannot cope with the fundamental causes of inflation.

The two main causes of inflation are the huge expenditures for war – the last one and the. next – and the robbery of the American people by the profiteering monopoly corporations.

Both major parties are committed to a war program and Clave been voting billions in appropriations to finance, it. Every ton of steel Used for tanks or gulls creates a scarcity and raises the price of refrigerators and automobiles. Every, bolt-of cloth used Tor uniforms creates a scarcity and raises the price of suits and dresses. The tons of food stockpiled for the military machine jack up the cost of pork chops and potatoes.

The war budget is not even up for consideration by the Special Session. And that’s one little thing to be thankful for because every time Congress takes up the war budget a few extra billions are tacked on to it.

Profiteering – or to call it by its right name, plundering of the American people – by the monopoly corporations is the second main cause of inflation. You are well aware of the billions made in profits during the war. That was bad enough. But today, according to Marriner S. Eccles of the Federal Reserve Board, peace-time profiteers are raking in twice the plunder they did in the war year 1943.

Profits Come First

The last Congress helped along this profit grab by lifting the excess profits tax. Truman does not now urge that this tax be completely restored and the Special Session is ready to turn, down his suggestion for only partial restoration. Profits come first. That’s what the capitalists say – and that’s how their political agents act.

Truman is proposing a return to government control over prices. The experience of World War II shows he is baiting a trap for the workers. Despite wartime controls, prices rose steadily. Administration officials found one pretext after another to lift price ceilings and they winked at the thriving black market. But every capitalist politician in office did his level best to enforce the wage freeze which was clamped on the workers in return for a fraud of government price control.

The fact is that prices are controlled today, controlled by the huge monopolies. They fix prices, restrict production, ration raw materials – all for their own unlimited profit. It is the National Dairy Products Company that says how much you must pay for a quart of milk. The Big Four Packers set the price of hamburger. The United States Steel Corporation, as we saw only last week, can raise the price of steel and thereby increase the cost of almost every manufactured commodity.

These monopoly corporations not only control prices. They control the Democratic and Republican parties. And through them they control the government. When the National Association of Manufacturers wanted price control removed, Congress removed them. When the meat packers demanded higher prices and imposed a meat famine on the nation, Truman quickly surrendered.

This control by the monopolies over the economy and the government must be broken before effective price controls can be instituted and the living standards of the people improved.

Smash the Stranglehold

The program of the Socialist Workers Party aims at smashing the stranglehold of Big Business and transferring control over economic and political life into the hands of the workers and farmers, the overwhelming majority of the American people.

We propose to nationalize, not this or that public utility as Wallace promises, but the meat combine, the steel trust, the chemical and oil monopolies, the banking syndicates and all other giant private corporations. These trusts must be nationalized without compensation. Through profits and high prices, the American people have already paid many times over for these industries. Unlike the Norman Thomas brand of nationalization, we advocate the operation of these basic industries under the democratic control of the workers.

While fighting for this basic program, steps must be taken to insure that wages keep pace with prices. The Socialist Workers Party was the first to advocate the principle of the sliding scale of wages. We propose that every union contract and government employment regulation contain an escalator clause which, would guarantee an automatic rise in wages with every rise in prices. Such a cost of living bonus would be added to the guaranteed basic wage which could not be reduced even if prices fell.

Next month the General Motors workers will receive.-an automatic increase in wages under the escalator clause in their present contract. This increase will not equal the real rise in prices because it is based upon the notoriously inaccurate government price index. This emphasizes the need for the unions to establish their own statistical bureaus as the recognized agencies for measuring price increases.

Consumers Committees Needed

The capitalist government, swarming with servants of Big Business, has demonstrated that it cannot be relied on to hold down prices. Only the people themselves can do this. The great mass of consumers, workers, veterans, farmers, housewives, must organize their own independent committees in every locality which should become the official agencies for checking and policing prices.

The high cost of living is the high cost of maintaining the profit system. This profit system moves from depression to war to inflation – and then repeats this terrible cycle all over again. At every point along this ruinous road, the American people pay heavily. They suffer either from lack of jobs or from lack of buying power when they are working, while the rich become richer, more reactionary and more arrogant.

A Workers and Farmers Government would smash this vicious cycle. Its planned Socialist economy would guarantee security, improve living standards and make way for unlimited abundance for all.

That is our program. We call upon you to support it with your vote in November and to fight for it all year round by joining the ranks of the Socialist Workers Party.

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