A tall, gaunt man stood up before a convention of farm-equipment dealers in Washington last week and made what he thought would be a scarcely noticed speech at a barely noticed meeting. Instead it cost him his job. The man was Dr. Edwin G. Nourse, titular head of the President's economic advisers. He began his speech by skeptically questioning a glittering prediction by his economist colleague, Leon Keyserling, of a $350 billion national income by 1958, with a $4,000 minimum a year for almost every family. Mr. Truman later used this as the basis for a new political war cry.
"I do not see standards of life being raised," Dr. Nourse said dryly, "... when a great labor organization sees the current situation as 'the occasion for a reduction in hours of work'... or when the czar of coal orders a three-day week with full pay . . . and when pensions at 60 are demanded for a population steadily becoming longer lived.
"I am filled with apprehension too when I look to management and see it choosing the costs of banked fires . . . rather than . . . re-examination of their practices of accounting and . . . price-making.
"I am uneasy when I see farmers demanding stimulative prices whilst Government accumulates gigantic surplus holdings . . .
"I am not happy either when I see Government slipping back into deficits as a way of life in a period when production and employment are high . . .
"We must recognize . . . that we can't get more out of the economic system than we put in ... and that monetary and fiscal tricks have no power of magic but are a slippery road to misery."
Ears at the White House caught the sound, and were displeased. There was that man again. Some White House machinery began to turn.
Man with a Transit. For three years, good, grey Edwin Nourse, 66, a onetime vice president of Brookings Institution, had been chairman of Harry Truman's Council of Economic Advisers. The CEA had been set up to keep the President informed as to the complex economy's ups & downs and in-betweens. On the CEA with Nourse were ardent New Dealer Keyserling, 41, who helped Senator Robert Wagner write the Wagner Act, and John D. Clark, an economic and political anomaly who was onetime vice president and director of Standard Oil of Indiana.
They were a strange group who found it hard to agree. As far as Nourse was concerned, the job was to report the economic terrain exactly as he saw it. As far as Keyserling was concerned, the job was to report the scene so that it fitted into the political philosophy of Harry Truman's Democratic Party. Between those two points of view, Clark wavered back & forth. In the beginning, Nourse's view of the CEA as an economic transit, not a political tool, generally prevailed.