Effect of Price Ceiling Only Temporary, Say Economists

Six University economists feel that the recent price freeze, while it will help the nation, is only a part of the solution to the inflation peril. In a statement released Saturday, these experts called the ruling only a "holding action."

They agreed that it was a stop-gap measure, necessary to halt anticipatory over-buying, but could only succeed for a limited time unless Congress sanctions higher taxes.

"It must be backed up with increased taxation," said Alvin H. Hansen, Lucius Six University economists feel that the recent price freeze, while it will help the nation, is only a part of the solution to the inflation peril. In a statement released Saturday, these experts called the ruling only a "holding action."

They agreed that it was a stop-gap measure, necessary to halt anticipatory over-buying, but could only succeed for a limited time unless Congress sanctions higher taxes.

"It must be backed up with increased taxation," said Alvin H. Hansen, Lucius N. Littauer Professor of Political Economy. John K. Galbraith, professor of Economics, added that taxes should be raised to the point where they balance spending.

The group was split over the issue of the timeliness of the price-freeze order. Seymour Harris '20, professor of Economics, considered the edict "premature" because the machinery needed to put the plan in operation is not yet ready. On the other hand, Malcolm P. McNair, Lincoln Filene Professor of Retailing, said it should have come earlier to prevent the wave of scare-buying that has been going on and keep prices at a lower level. No mention was made of a price roll-back.