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Jack Ranger

Tapping the Wall St. Wire

(6 June 1949)

From Labor Action, Vol. 13 No. 23, 6 June 1949, p. 3.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

“The Industrial and commercial bourgeoisie,” flatly asserted Professor Joseph A. Schumpeter in 1942, in the very midst of the bloodiest imperialist war to date, “is fundamentally pacifist and inclined to insist on the application of the moral precepts of private life to international relations.”

The professor cited no evidence to support his fascinating assertion, one of many wonderful things found in his anti-Marxist work, Capitalism, Socialism and Democracy.

If you believe the professor, then of course you need not concern yourselves with the possibility of a third world war. But if you are one of the industrial and commercial bourgeoisie, or one of the victims of that predatory class, then you will be hip-deep in concern with the new blood bath which the “private enterprise system” is preparing for the world.

Just recently in Chicago a few hundred of the “industrial bourgeoisie” concluded a 10-day study course on economic mobilization planning, the second in a series of such courses conducted throughout the nation by the Armed Forces Industrial College. The course was not “planning for war.” Professor Schumpeter would have liked the term used for the course. It was “planning for the prevention of war.”
 

Third World War Will Bring Ten-Cent Dollar

Some of the ideas expressed during the seminar are of general interest.

Perhaps of greatest interest was the talk presented by Commander Greenhalgh on the inflationary prospects of a future war. A third war, he said, could lift the public debt from its present $252 billion to $600 billion. Interest charges would be “staggering,” declared Greenhalgh. Debt service on the present national debt now costs $5½ billion a year. On a $600 billion national debt it would rise to $12 or $15 billion.

Greenhalgh doesn’t believe the government would consider repudiating the public debt. Instead, he believes, prices might be allowed to rise, with the dollar further devalued as a means of lightening the debt burden. He predicted a “nine- or ten-cent dollar” in terms of 1939 purchasing power, as the aftermath of another world war. “The dollar of today, worth less than 60 cents in pre-war purchasing power, might very well become a nine- or ten-cent dollar of a post-World-War III period,” he said.
 

Is There an Adding-Machine in the House?

Lecturers described the increasing costs of war. Whereas the annual expense of maintaining a soldier today is $3,300 (against $1,350 in 1940), prices of raw materials and manufactured goods would be up 50 per cent from World War II, in the event of another war, it was declared.

Assuming 12 million men under arms, and purchase of the same amount of munitions as in 1944, a new war would cost $143 billion a year. If It lasted as long as the United States was in the recent war, it would cost $540 billion. The U.S. bill for the last war was $381 billion, of which $153 billion was squeezed out in taxes and $228 billion was borrowed.

Commander Greenhalgh said the prevailing opinion in top military circles was that a war with Russia would continue longer than the fracas with the Axis powers.

Among the subjects discussed by the peace-loving industrial and commercial bourgeoisie in the present study course were joint strategic planning, geopolitics, joint mobilization, and the relation of economic factors to political and military problems.

*

Economic Notes

Profits through 1950 are assured the peace-loving aircraft manufacturers, according to official sources which show current backlogs of prime military aircraft and engine contractors to total $2,626,303,594, a sum which is less than half the total to be spent on aircraft and equipment by the air force and navy. Forecast for 1949 is that the industry will show an operating profit of about $200 million ...

Tito recently signed a large contract with the Continental Supply Company, a subsidiary of the Youngstown Sheet & Tube Company. The contract calls for the company to supply several million dollars’ worth of oil-drilling equipment and tubes to the Yugoslavian ministry of mines. American technicians will go to Yugoslavia to supervise installation and operation of the equipment ...

The Chevrolet division of General Motors Corporation has purchased a war-built manufacturing plant in Saginaw, Mich., which it now occupies. Chevrolet paid $1,300,000 to the War Assets Administration for the property. It was built at a cost of more than twice that figure, $2,800,000.

 
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