Public Papers of Lyndon B. Johnson, 1965

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Author: Lyndon B. Johnson  | Date: May 3, 1965

226
Statement by the President on Making Public a Report of the Council of Economic Advisers on Steel Prices.
May 3, 1965

I AM releasing today the report of the Council of Economic Advisers on steel prices.

The Council’s report is a basic study of the economic situation and problems of the steel industry. It demonstrates conclusively two major facts:

1. Wage and price behavior consistent with the "Guideposts" has been good for the prosperity of the steel industry and for the employment of steelworkers.

2. Stability of steel labor costs and of steel prices has been good for the Nation. It has made and will make a major contribution to the stability and progress of our whole economy.

This study reinforces my conviction of the soundness of the "Guideposts" as a cornerstone of American prosperity.

In recent years, the steelworkers union has negotiated wage and fringe benefit increases which have kept labor costs per ton of steel stable. With stable costs, steel prices have held steady. And steady steel prices have been a major factor in the stability of our industrial prices.

After a long period of slack, steel production has now resumed its long-term increase, responding to our general prosperity. In spite of steadily falling labor requirements per ton of steel, steel employment last year turned up again after a long decline.

The measures Government has taken in the past 4 years to strengthen our economy have helped the steel industry very directly. Liberalized depreciation allowances, the 7 percent investment tax credit, and the cut in corporate income tax rates have substantially raised the profits and the "cash flow" of the steel industry.

Steel’s recent record-breaking cash flow has equaled or exceeded the industry’s large recent investments in new plant and equipment. This new plant and equipment-embodying the most modern technology__ offers great future promise for lowering the costs and improving the quality of steel. Cheaper and better steel will help to defend the industry’s markets against further inroads of foreign competition and substitute materials. Thereby it will provide more and better jobs for steelworkers, and better profits for the companies.

I urge the steel industry, the United Steelworkers, and the American public to read this report with care and to reflect on its findings.

I am sure that all will share the Council’s conclusions that the prosperity and stability of the whole economy, as well as the prosperity of the steel companies and their workers, lies in

—a noninflationary final settlement of the labor negotiations, consistent with the "Guideposts";

—based on such a settlement, the continued overall stability of steel prices; and

—continued national measures to promote the prosperity and growth of the American economy and thereby of steel and all other major industries.

NOTE: The Council of Economic Advisers’ "Report to the President on Steel Prices" is dated April 1965 (Government Printing Office, 67 pp.).

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Chicago: Lyndon B. Johnson, "226 Statement by the President on Making Public a Report of the Council of Economic Advisers on Steel Prices.," Public Papers of Lyndon B. Johnson, 1965 in Federal Register Division. National Archives and Records Service, Public Papers of the Presidents of the United States, Lyndon B. Johnson, 1965 (Washington, D.C.: Government Printing Office, 1956-), P.1168 Original Sources, accessed April 24, 2018, http://www.originalsources.com/Document.aspx?DocID=DB9UPL8LYVFUTVC.

MLA: Johnson, Lyndon B. "226 Statement by the President on Making Public a Report of the Council of Economic Advisers on Steel Prices." Public Papers of Lyndon B. Johnson, 1965, in Federal Register Division. National Archives and Records Service, Public Papers of the Presidents of the United States, Lyndon B. Johnson, 1965 (Washington, D.C.: Government Printing Office, 1956-), P.1168, Original Sources. 24 Apr. 2018. www.originalsources.com/Document.aspx?DocID=DB9UPL8LYVFUTVC.

Harvard: Johnson, LB, '226 Statement by the President on Making Public a Report of the Council of Economic Advisers on Steel Prices.' in Public Papers of Lyndon B. Johnson, 1965. cited in , Federal Register Division. National Archives and Records Service, Public Papers of the Presidents of the United States, Lyndon B. Johnson, 1965 (Washington, D.C.: Government Printing Office, 1956-), P.1168. Original Sources, retrieved 24 April 2018, from http://www.originalsources.com/Document.aspx?DocID=DB9UPL8LYVFUTVC.