Statement Following Action on Post-Freeze Economic Stabilization Legislation by the House Committee on Banking and Currency.

ON October 7, I outlined to the Nation a program which would continue wage and price restraints for the purpose of winning the battle against inflation. This program was a continuation of the effort which began with the 90-day freeze that was announced on August 15.

In developing this new program, we consulted with scores of representatives of labor and business, of farmers and consumers, of the Congress and State and local governments. These people were virtually unanimous in their belief that the battle against inflation must be fought here and now, and they were together in their determination to win that battle.

The program developed was designed to rely primarily on the good faith and voluntary cooperation of the American people. It is essential that no action be taken which allows any single interest to escape the fair application of the law.

On October 19, I submitted to the Congress legislation to amend and extend the Economic Stabilization Act of 1970. This legislation was designed to provide a sound basis for the administration of the postfreeze economic stabilization program.

Today, the House Banking and Currency Committee adopted a number of amendments, some of which are damaging and clearly inconsistent with the effort to achieve reasonable price stability. The most significant of these actions by 17 Members of the House would have the effect of providing for the payment of increases embodied in existing employment contracts executed before August 15, and to require the retroactive payment of increases required by these contracts. That question is one of the many related problems now being considered by the Pay Board and Price Commission. It is not my intention to prejudge how these particular issues should be decided. These are matters for the Pay Board and Price Commission to decide.

The committee's action is clearly inconsistent with the purposes of the economic stabilization program. It would provide for a piecemeal approach to the development of the program and ignore the effect of these actions on other aspects of the problems being considered by the Pay Board and the Price Commission. The amendment would provide for' special treatment to one segment of the American economy.

Most importantly this action would limit the flexibility of the Pay Board and Price Commission to consider the widest possible range of actions and options and limit their ability to develop a course which is the most equitable to all Americans.

If the Congress enacts this amendment to the Economic Stabilization Act, I believe that it would seriously jeopardize the ability of the Pay Board and Price Commission to reach the goals we all expect of the post-freeze program. I am confident that the majority of the Members of the Congress share my view, and that this and similar piecemeal amendments, which would preclude the Pay Board and the Price Commission from having an opportunity to develop a balanced approach to the many related problems, will not be enacted.