Excerpts from the Press Conference

Q. Mr. President, can you forecast as to what is going to happen to O.P.A.?

THE PRESIDENT: So far as I know, it's going on.

Q. It isn't going to be split up, so far as you are concerned?

THE PRESIDENT: No, no. Oh, perhaps I could put it this way:There's a lot of loose thinking abroad in Washington. perhaps "abroad in Washington" doesn't fit together. Perhaps it's an anachronism, or something like that. I will say "in Washington." Leave out "abroad." You know some of the things I have said about Washington. The people are very apt to get confused by the trees, don't see the forest as a whole. The largest thing that we are after in all this discussion is a very old thing which hasn't yet been solved, and that is keeping the cost of living down. You can't eat your cake and have it too, when people are shying off from keeping the cost of living down.

You all know what would happen if we started the spiral of inflation in this country. If the cost goes up on the things that the consumer buys, then, of course, the next step would be to give higher wages. And then the cost of food would go up again, and you would have to increase the cost of food. Then you would go around the circle again; you would have to equalize it by increasing the cost of wages again.

We all know, too, what would happen to our savings if the cost of living went up. I don't want to put a dollar in the bank and pull it out again in two or three years with a buying power of only fifty cents. I think that is sort of silly.

So in some way, in trying to keep the cost of living down, we ought to analyze what we have done.

Well, we have stabilized the cost of rents, which represents from 22 to 33 percent of the average family's income. Well, that is pretty well taken care of all over the country.

And then there is another, around 33 percent, the cost of clothing and furniture and things like that. Well, that has been pretty well stabilized.

And then you have got another, the third third—which is a rough figure—the cost of food. That has not been stabilized. But of course- well, when May Craig or I go to the A. and P.—

MAY CRAIG: (interjecting) Safeway.

THE PRESIDENT: Oh, excuse me. I don't go to that chain, but it's all right. (Laughter)

When we go there, of course, it looms pretty big, because we are paying out cash, and we think that that third that goes into food is the largest item, and almost the only item—it's a psychological thing- that is, in the cost of living.

Now, of course, there are one or two things that are bound to happen, if the cost goes up on the necessities of life. I am not talking about strawberries in January, I am talking about the things that keep body and soul together. If those prices are allowed to go up without any effective regulation, you have got your spiral started.

Now on the other hand, if we set a ceiling on the prices of necessities in the food line, it is perfectly possible that because of short crops or because the actual cost of production—that is to say, the farmer's cost—has gone up a lot, and the processing cost has gone up a bit, and the distribution cost has gone up a bit, you have a perfectly legitimate figure that you have got to sell to the public at, which is much higher, unless somebody pays the difference between that higher price and the ceiling price. Well, that's what we would like to do.

It's only fair to the farmer, and to the processor, and the distributor, that they get their money back, and that the farmer's prices should not go down, and the processor and the distributor should at least come out even, with even a small profit. But that may bring the price beyond the ceiling, and somebody has to pay that differential.

Well, I wish somebody could give me some method of doing that. I have asked that question of a lot of people, "Can you find a method of doing it?" And they all come back to the same old thing. They call it a subsidy, or you can call it a differential, where the Government will pay it.

Well, it might cost us a billion dollars and a half—I am just taking figures I have read in the papers- additional in the war effort, in order to keep the cost to the consumer of the essential food articles down below that ceiling. Well, on a hundred-billion-dollar budget of running this war, a billion and a half or two billion is 1 1/2 or 2 percent of the total cost of running the war. It has been done successfully in other places, with perhaps a little simpler problem.

But if anybody can devise a method that is better than that, we are only too willing to look into it. But nobody has ever done it yet. That is a method; and nobody has given any other method. Now when you come down to where I am talking about Washington not thinking things through, I have had, of course, a great many with "happy thoughts" in them.

We know perfectly well that what we need is a properly organized administration, and I think probably without any question there have been a great many delays that have been caused by two or three agencies having to look into the situation, and sometimes you find a month or six weeks or two months of delays before you get a decision. That is absolutely true, as we have groped our way into this thing, during the past year. I think it is only about two weeks ago when we set up the new organization of the Office of War Mobilization. That is one of their particular functions, to coordinate the three or four different groups that have to do with portions of this problem.

But on the other hand, it has been suggested of course, by people who don't always think things through, that the mere fact of having some sort of glorified "czar" would cure the whole thing.

And one of the best illustrations of that is that when this suggestion was made to me, I said to the gentleman who suggested it, "Well now, what sort of things would the czar do?"

"Well," he said, "a friend of mine in a certain State had a carload of food that he wanted to send to the processor, or the distributor, and he knew that the carload of stuff would be about ripe for shipping the following Monday. So he put in his order for a freight car.

"Now," he said, "the railroad people said he couldn't have a freight car, and what I want is a czar who will be able to say to Mr. Eastman [Director of the Office of Defense Transportation], 'I have got to have that freight car there next Monday.'"

Well, you see how perfectly absurd the whole thing is. Mr. Eastman would come back and say, "I am awfully sorry but I have got—just to take any old figure—I have got a million freight cars and I have got demands for a million and a half. So I have got to parcel them out in the fairest way I possibly can. I have got to try to make a million cars do the duty of one million and a half. That means that quite a lot of people are not going to be served when they want to be served. It's a condition and not a theory. I have only got a million cars."

So I said to this gentleman, I said, "In other words, you would have a food czar with authority to say to Mr. Eastman, 'Whether you like it or not, Mr. Eastman, you have got to transport food ahead of anything else. I am the food czar.'"

Well, pretty soon I guess, Donald Nelson would say to Mr. Eastman, "I am moving some very much needed spare parts for airplanes from the Middle West to the seaboard, in order to ship them over to Africa, and I want a hurry-up order."

Mr. Eastman would say, "I am awfully sorry but I have had to give those cars to the food fellow."

And somebody else would say- the Army or the Navy in time of war—they have got to have a car to take this, that, and the other thing that is needed by the Army and Navy in Europe or the Southwest Pacific.

Mr. Eastman would have to say, "I am terribly sorry but the food czar won't let me." You see what a perfectly impossible situation it is.

Now as a matter of fact, this new organization of the O.W.M.—as I said, it's only about two weeks old- and one of their principal duties is to coordinate the O.P.A. and the Food Administrator and the Department of Agriculture, and see that they speak to each other before any of these important decisions are reached, and do it right away and get out a decision much more quickly than we have been doing it in the past. In other words, use a rule of judgment, instead of the rule of "happy thought."

Q. Mr. President, in that connection, there has been a good deal of discussion about these subsidies, or what have you, up on the Hill, and with some of the Administrators who have been carrying the ball in that regard. If Congress doesn't suggest anything more constructive, do you intend to ask them for subsidies to handle that?

THE PRESIDENT: I think I would put it this way. As I have said before, I think that there is a way of holding the cost of essential foods down to a ceiling. Now if they have a better way a "better 'ole"—I would be tickled to death. But nobody has suggested the "better 'ole" yet.

Q. Mr. President, it has occurred to some of us that a rather large group on the Hill would like to have all prices go right straight up to a demand level.

THE PRESIDENT: Yes, yes.

Q. That seems to be their "better 'ole."

THE PRESIDENT: Yes, it's the spiral.

Well, of course, whom does that affect? It affects primarily two groups. The first group it doesn't bother much, because they work for a fluctuating pay, which of course would almost of necessity go up if the cost of living went up; and I suppose in that group belong the industrial occupations chiefly, and probably they represent about half the population of the country.

Well, in the other half of the population- you are in it, and I am in it. If the cost of food goes up 100 percent, do you think that your salaries are going up 100 percent? Do you think they would give me double my salary? Take the white-collar group—there are over six million white-collar workers alone in this country. Now, their salaries don't go up with the cost of living. They never have, and I don't believe they ever will. You have got the clerks, the stenographers, in the small towns and the big towns. Theirs don't go up in accordance with the cost of living. So, as the cost of living goes up, you are bearing down very unjustly on at least half the population of this Nation.

Q. Do the people on the Hill seem convinced by that?

THE PRESIDENT: I think they are beginning to think about it more.

Q. Mr. President, does Mr. [Chester] Davis think he has all the power he needs to do his food job?

THE PRESIDENT: I don't know. I have heard nothing to the contrary. The only thing I have heard from him lately was, "For goodness' sake don't give me the O.P.A. job!" (Laughter)