Nixon Cattle Hog Poultry Feed
NIXON SETS MEAT PRICE CEILINGS AT BOTH WHOLESALE AND RETAIL; ASSERTS COSTS 'SHOULD GO DOWN'
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March 30, 1973
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WASHINGTON, March 29 —President Nixon announced tonight in a nationally televised speech that the Government was imposing price ceilings on beef, pork and lamb effective immediately and for an indefinite period.
The ceilings applied to wholesale and retail prices but not to live animals.
Text of President's speech will be found on Page 16.
"Meat prices must not go higher," the President said. "With the help of the housewife and the farmer, they can and should go down."
Treasury Secretary George P. Shultz explained at a White House briefing that ceiling prices for the various cuts of meats sold by individual processors, wholesalers and retailers would have to be calculated on the basis of their prices during the 30 days through March 28.
Prices Up Sharply
Food prices in general and meat prices in particular have been rising rapidly and havereached record levels in many cases. Mr. Shultz said that perhaps the Administration should have acted earlier.
Although Mr. Shultz did not say so, the President appeared to be attempting to head off Congressional enactment of statutory ceilings as part of an extension of the Economic Stabilization Act. It is scheduled to expire April 30.
In another move to check rising prices of food and lumber, Mr. Shultz said that the President was sending to Congress "for immediate action" a request for authority to reduce or suspend tariffs and import quotas on commodities whose prices have been going up rapidly.
Asked how shoppers and retailers would know tomorrow morning what the maximum lawful prices were, Mr. Shultz replied, "I don't know what they can actually do tomorrow."
Public Support Asked
The President, arguing that the struggle against inflation included his budgetary battles with the Democratic Congress, asked the public to support his vetoes of spending bills. A vote to override vetoes and spend more than the $268‐billion requested in the Presidential budget is a vote for "higher taxes or prices," Mr. Nixon said.
Although the last American troops have been withdrawn from Vietnam, he also cautioned the country not to expect big cuts in defense spending.
"If we cut our defenses before negotiations begin, any incentive for other nations to cut theirs will be completely removed," the President said.
Mr. Shultz indicated that enforcement of the ceilings would be along the lines of enforcement during Phase 2 of the Nixon Administration's wageprice controls program. This includes prominent display of lists of ceiling prices in stores, spot checks by the Internal Revenue Service and investigations by the service in response to consumer complaints.
"The I.R.S. will be around," Mr. Shultz said.
The White House also anflounced that as of tonight no pay increases could be awarded to food‐industry workers without prior approval of Cost of Living Council.
Mr. Nixon, in his televised address, said that he was acting to "stop the rise in meat prices now."
A high official of the Agriculture Department said privately several days ago that the Administration was being urged to put a ceiling on meat prices because they were starting to decline anyway, and the President could thereby get credit.
"A cheap shot," the official said:
Secretary Shultz said that the ceilings would "cut off potential further increases in prices." Going beyond Mr. Nixon's restrained appeal for "the help of the housewife and the farmer," Mr. Shultz said in a prepared statement that housewives "can help bring about an end to rising meat prices by resisting high prices and by shopping wisely."
Although the Secretary, following the path taken by the President two weeks ago, refused to endorse explicitly a meat boycott called for next week, he expressed the hope that the "housewives' rebellion" coupled with Government measures to increase food supplies would "bring these prices down."
In response to a question about the timing of tonight's action, Mr. Shultz said that "perhaps it should have been done two months ago."
He insisted, as the Administration has all along, that it would not be helpful to try to control the price of "cattle on the hoof, the pig while it still squeals."
He suggested that by imposing ceiling prices on stockyards and processors, the Administration was stiffening their resistance to paying higher prices to farmers.
The calculating of ceiling prices, Mr. Shultz said, would be made as it was for the 90‐day wage‐price freeze of Aug. 15, 1971, that began the stabilization program. Merchants would have to determine the highest price at, which they did at least 10 per cent of their business.
That price, for a given cut of meat, might be yesterday's price, but it could be higher or lower. Officials appeared to be counting on competition from supermarket chains, which maintain records of their prices, to keep in line the prices of small, independent butchers who might not have records that the revenue service could check.
The imposition of ceilings icarried the White House full circle back to Phase 1 with respect to meat. When that 90‐day freeze ended, the Administration switched to Phase 2 in which prices could be raised only if costs had/risen, Phase 2 was characterized by a requirement that big corporations get advance approval for price increases, and a profit‐margin rule that inhibited some companies' price increases.
Secretary Shultz was asked two or three times if he did not fear that the ceilings would tend to become a floor, preventing prices from declining. He disputed that, saying that expected increases in slaughter of cattle, calves and hogs plus some buying restraint were likely to bring prices lower.
Only two weeks ago, Mr. Nixon ruled out at a news conference ceiling prices on farm and food prices, saying that he did not think they would work. Why the sudden change of heart, Mr. Shultz was asked.
He replied that the shortages the President warned about would be caused by putting controls on farm prices, and that was why live animals had been exempted from the new regulations.
House Democrats on the Banking Committee are backing a bill that would freeze prices and interest rates at the March 16 level. The Administration would prefer to keep entirely in the President's hands the power to impose, modify and lift controls.
Democrats on the House Banking Committee won a victory today when Agriculture Secretary Earl L. Butz, yielding to the threat of a Congressional subpoena, reversed course and agreed to testify before the committee.
The possibility of a fresh confrontation between the Republican Administration and the Democratic Congress over the availability of Presidential advisers was averted by the Secretary's decision. He is to appear Monday alongside Treasury Secretary Shultz and John T. Dunlop, director of the Cost of Living Council.
Dr. Butz was testifying before the Senate Agriculture Committee this morning when an aide showed him a note reporting that the Banking Committee had scheduled a vote at 2 P.M. on whether to issue a subpoena.
"Off the record," Dr. Buti said, "I am going to be subpoenaed by a House committee if I don't get over there." He then indicated that he would appear, and an Agriculture Department official telephoned the Banking Committee.
The Banking Committee chairman, Representative Wright Patman of Texas, ended the tension a few minutes later with a two‐sentence statement.
"I'm pleased to announce," he said, "that Mr. Butz will be before our committee at 10 o'clock Monday morning. The meeting at 2 o'clock will be unnecessary."
The Banking Committee was continuing hearings on the Administration's request for a simple one‐year extension of the Economic Stabilization Act, which authorizes wage‐price regulations and a bill sponsored by 20 Democrats on the committee that would impose ceilings on prices, rents and interests rates.
The Administration strongly opposes a statutory imposition of such controls, which would run counter to its hope that phase 3 of the stabilization effort will be a time of transition to no controls.
The bill of the committee Democrats would also direct the Federal Reserve Board to regulate credit in commodities future trading and would create an Office of Consumer Counsel. The counsel could require the Cost of Living Council to hold public hearings on prices, interest rates and wage increases and to explain its decision in writing.
Labor representatives supported another provision of the bill that would raise to $150 the hourly wage below which workers are exempt from the Phase 3 wage standard. Subject to various exceptions, it says that wages should rise by no more than 5.5 per cent a year.
However, labor spokesmen also told the committee that they would prefer that the stabilization act be allowed to expire as scheduled on April 30.
"Any effort, either by the Congress or by the Administration, to Impede free collective bargaining can only result in severe economic injustice to working people," said Leonard Woodcock, president of the United Automobile Workers and a member of the Administration's labor ‐ management advisory committee.
Mr. Woodcock canceled an appearance before the committee and sent a letter, which his office in Detroit made public.
Paul Jennings, president of the International Union of Electrical, Radio and Machine Workers, opposed extension of the act. If it is extended, he said, it should include controls on farm prices, a rollback of rent increases since Phase 3 began on Jan. 11, a 6 per cent ceiling on interest rates and controls on profits "tighter than existed under Phase 2."
David Livingston of New York, president of District 65 of the Distributive Workers of America, asked Congress for "a food subsidy plan whereby the Government would pay the difference between prices the people can afford and prices charged by various sections of the food industry." He estimated that the plan would cost $4‐billion a year.
George C. Martin, president of the National Association of Home Builders, asked for controls on lumber and plywood and "all interest rates, including the cost of mortgage money."
Mr. Martin opposed the reimposition of Federal rent controls. "It is the feeling of those of our members who own and operate apartments that there is little need today for controls over rents," he said.
George' Hagedorn, vice president and chief economist of the National Association of Manufacturers, supported one‐year extension of the act without change. Endorsing the Administration's view, he said that Phase 3 "should be used as a transition to an economy that would be totally free of wage and price controls."
Spokesmen for the National Forest Products Association and the American Plywood Association supported extension of the act and opposed the reimposition of mandatory price controls on lumber.
The question of an appearance by Secretary Butz, who also holds the title of counselor to the President for natural resources, appeared to be moving toward a showdown at the opening of this morning's hearing. Mr. Patman reported that the Secretary had refused for the second time to testify.
Source: https://www.nytimes.com/1973/03/30/archives/nixon-sets-meat-price-ceilings-at-both-wholesale-and-retail-asserts.html
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