DUNSTER FORUM DISCUSSES ECONOMICS OF DEFENSE BEFORE LARGE CROWD
Schumpeter Emphasizes Danger of War Society Becoming Permanent
Six of Harvard's best known economists, and a noted M. I. T. professor spoke in the Dunster House Forum last night on "The Economic Outlook of Defense," before a crowd of 200 people.
Opening the program, Alvin H. Hansen, Lucius N. Littauer Professor of Political Economy, gave a picture of the magnitude of the defense program and the implications of defense expenditure. Claiming that the present sum of $6,000,000,000 to be spent for defense during the next fiscal year, is nothing compared to the sums that will be spent in the future, Hansen made the point that with the rise in expenditures, "our capacity for production must be allowed to expand to increase our national income."
John H. Williams, Dean of Graduate School of Public Administration, and J. Franklin Ebersole, professor of Finance, pleaded for sanity in taking steps to ward off inflation, and, as Williams emphasized, "We must be careful not to take premature steps to step inflation, for by so doing we might at the same time create further unemployment, which would hinder defense."
Contending that the financial and economic phases of the discussion had already been fully presented, Joseph A. Schumpeter, George F. Baker Professor of Economy, purposely digressed from the main topic, and went on to a discussion "of the possibilities of an endless war."
Schumpeter declared that the conception of an endless war-society was not as fanciful as it seemed, and that "war-fare might very conceivably become an integral part of society, without an economic breakdown, by means of a super-gearing of industry by force and propaganda."
Paul M. Sweezy '32, instructor in Economics, agreed with Schumpeter on this point, and added, "We must increase consumption on the part of the masses, and we must levy additional profits taxes on industry to prevent this kind of over-development of our economic society," which would result in "an American brand of Fascism and Imperialism."
John P. Wernette '32, assistant professor of Business Economy, and Professor Paul 'A. Samuelson of M. I. T. spoke on "procurement planning on the part of military 'authorities" as vital to our defense program and as a basis for further governmental control of business.
Seymour E. Hatris '20, associate professor of Economics, presided at the forum, intermittently summing up the views expressed by the speakers, and conducting a question period from the floor at the end of the speeches and comments.