Masonry Magazine February 1972 Page. 22
Washington Wire
(Continued from page 21)
raising large amounts of new revenue-revenue that could be sent to the states to ease the burden of school taxes.
Political and technical problems killed the scheme for this year. Democrats had already begun attacking the idea. Also, it seemed unwise to ask for a tax rise in an election year. No way was found to assure the intended use of the revenue.
WAGE-PRICE CONTROLS MAY BE PARTLY DISMANTLED
before the year is over. There is even a chance that some controls may be ended before Election Day. No firm blueprint has been drawn up yet for phasing out the restrictions. And officials insist that the President won't let up until inflation has been licked. But he is philosophically opposed to using any controls, and doesn't want to see them remain in force for even one day longer than needed. What's more, ending controls early would be a plus for Mr. Nixon's reelection.
Decontrol will no doubt be accomplished gradually-one step at a time. Note that "mom and pop" retailers have already been excused from controls. Next are likely to be industries in which wage and price increases have been slowed way down.
SOME INTEREST RATES ARE LIKELY TO BE RISING AGAIN
as 1972 rolls on. The enlarged Federal deficit of $39 billion virtually assures some uptrend. This will put upward pressure on money costs, especially short-term rates. And the recent declines in long-term rates will probably be halted for now. You've probably seen the last cut in the prime lending rate for a while. Higher short-term rates could soon result in a boost of this key rate.
Officials hope the smaller deficit now promised for the next fiscal year will let interest rates resume their decline.
CONGRESS IS BEING URGED TO IMPOSE A RIGID CEILING
on Federal outlays. The Nixon Administration has proposed legislation to curb excessive spending. Unlike expenditure ceilings of the past, this one would have no loopholes. It would allow no exceptions and apply to both Congress and the White House. The uncontrollable Federal Budget is raising concern in the Administration. Officials fear serious consequences for the economy from those big deficits. A sharp rise in interest rates could well inhibit the recovery's progress.
But there is no guarantee Congress will pass such a spending ceiling. Lawmakers do not like to limit their own freedom, especially in an election year. And there is no assurance the ceiling would be observed, even if it were approved.
PRICES ON A RANGE OF STEEL PRODUCTS
WILL BE RISING again during 1972. Reductions made in January on several products will be restored before long. The increases will take place as soon as shipments by the industry improve. After falling to low levels, steel-making will be back to normal by March.