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Updated: July 15, 2025
Unless we check the excessive growth of Federal expenditures or impose on ourselves matching increases in taxes, we will continue to run huge inflationary deficits in the Federal budget. If we project the current built-in momentum of Federal spending through the next 15 years, State, Federal, and local government expenditures could easily comprise half of our gross national product.
These extraordinary demands and shortages may lead to a speculative boom, especially in the price of securities, real estate, and inventories. Therefore, our chief worry still is inflation. While we control this inflationary pressure we must look forward to the time when this extraordinary demand will subside. It will be years before we catch up with the demand for housing.
Unless we check the excessive growth of Federal expenditures or impose on ourselves matching increases in taxes, we will continue to run huge inflationary deficits in the Federal budget. If we project the current built-in momentum of Federal spending through the next 15 years, State, Federal, and local government expenditures could easily comprise half of our gross national product.
Moreover, inflationary pressures still appear dangerously powerful, and ill-advised tax reduction would operate to strengthen them still further. My decision not to recommend additional tax reductions at this time is made in the light of existing economic conditions and prospects.
This is a goal that every American who's ever struggled with a tax form can understand. At the same time, however, I will oppose any efforts to undo the basic tax reforms that we've already enacted, including the 10-percent tax break coming to taxpayers this July and the tax indexing which will protect all Americans from inflationary bracket creep in the years ahead.
Even the venerable Wall Street Journal fell in this fashionable trap. In an inflationary turn of phrase, "moral hazard" is now taken to encompass anti-cyclical measures, such as interest rates cuts. The Fed and its mythical Chairman, Alan Greenspan stand accused of bailing out the bloated stock market by engaging in an uncontrolled spree of interest rates reductions. Greenspan."
This is a goal that every American who's ever struggled with a tax form can understand. At the same time, however, I will oppose any efforts to undo the basic tax reforms that we've already enacted, including the 10-percent tax break coming to taxpayers this July and the tax indexing which will protect all Americans from inflationary bracket creep in the years ahead.
In view of the still extraordinarily large expenditures in the coming year and continuing inflationary pressures, I am making no recommendation for tax reduction at this time. We have already had a substantial reduction in taxes from wartime peaks. The Revenue Act of 1945 was a major tax-reduction measure.
Why should we ignore it now? We must avoid any contribution to inflationary processes, which could disrupt sound growth in our economy. Prices have displayed a welcome stability in recent months and, if we are wise and resolute, we will not tolerate inflation in the years to come. But history makes clear the risks inherent in any failure to deal firmly with the .basic causes of inflation.
Both are preoccupied with boosting the share's price rather than the company's business. Hence the inflationary executive pay packets. Shareholders hire stock manipulators euphemistically known as "managers" to generate expectations regarding the future prices of their shares.
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