More Planned Chaos

February 19, 1962

President Kennedy’s call for a Congressional investigation of the government’s war-emergency stockpile program is gratifying. Such an investigation, in fact, is long overdue. Let us hope that it will not deteriorate into mere personal and partisan charges, but will confine itself mainly to essentials and basic principles.

If the investigation is partisan, neither party is likely to derive much credit from it. The program was started in 1939, under Roosevelt, resumed by Truman in 1946, and expanded by Eisenhower. In fact, it is astonishing that Mr. Kennedy was “astonished” to find that the nation’s strategic stockpile now contains $7.7 billion worth of materials. This does not differ much from the situation a year ago, when he came into office. And the figures have been published monthly for more than two years by the Byrd Joint Committee on Reduction of Nonessential Federal Expenditures.

Mr. Kennedy declared that the materials the government is holding exceed the nation’s “emergency requirements as presently determined by nearly $3.4 billion” even though these requirements are based on the highly improbable assumption that a (presumably nuclear) war today would last as long as three years. But this overbuying has also long been common knowledge.

HANDOUT TO INDUSTRY

Five years ago official estimates indicated that the U.S. had enough tungsten aboveground to last for six years at the peak wartime rate of consumption. Even a tungsten producer, Philip M. McKenna, pointed this out, and opposed Federal subsidies to domestic tungsten producers as neither necessary nor desirable. The government purchases of lead and zinc were also widely recognized five years ago as nothing more than a handout to industry.

The stockpiling program demonstrates once more that when the government embarks on a commodity buying, subsidizing, or “stabilizing” program even for “essential” purposes, political pressures and momentums develop that carry it far beyond its original or any rational purpose. It now includes some 76 commodities. The government dare not reverse its program, and fears even to halt it, lest it demoralize the very markets and producers it was trying to help.

In the press conference in which Mr. Kennedy called for an investigation of stockpiling, he only incidentally mentioned the most costly stockpiling program of them all, that of agricultural commodities. The Byrd committee figures show that on Nov. 30 the total cost value of stockpiles under the General Services Administration was $8.7 billion, but the agricultural price support program added $5.4 billion more, bringing the total above $14 billion. For the fiscal year 1961, annual storage costs of agricultural stockpiles were $460 million, out of a total $475 million.

‘AID’ MEANS CONTROLS

Ironically, on the same day as the President publicly worried about the strategic stockpiles, he submitted to Congress a new agricultural support program. True, he argued that this would reduce surpluses. But his argument rested on the assumption that in return for their subsidies the farmers will accept the most complicated and drastic controls, not only over acreage but over marketing quotas, to which they have ever been subjected. The alternative with which they are faced is that if they refuse to accept such controls not only will all price supports be dropped but also the government will dump its holdings of crops on the open market.

The present predicament of these programs emphasizes once more the danger to producers from accepting government “aid” and subsidies. Always, eventually, these lead to governmental control and dictation. Let us hope that the colleges and the score of other present applicants for Federal funds can learn this elementary lesson.

Meanwhile, it is worth pointing out that government “stabilizing” programs are always, in the long run, unstabilizing programs. The President’s own farm message concedes that the government’s past farm programs have led to “the drift toward a chaotic, inefficient, surplus-ridden farm economy.”