The Economy: Where Restraint Begins

For most of the year President Johnson's advisers have worked full time muting the notion that drastic action might be necessary to head off serious national inflation. But last week, as if on cue from an unseen conductor, the Administration's tune changed. From White House aides, the Treasury and members of the Federal Reserve Board came warnings about the need for fiscal restraint in an economy that keeps on exuberantly expanding.

There was cause for concern. The Bureau of Labor Statistics reported the swiftest six-month cost-of-living increase since 1958. Capped by a gain of 0.3% for June, the consumer price index...