Presidential Papers, Doc#1309 Memorandum, 19 February 1955. In The Papers of Dwight David Eisenhower
<--PREV
Doc #1308		  |  Memorial Commission
Home Page		  |  First Term
Table of Contents		  |  Presidential Papers
Home Page 		 | 
Doc#
 |  NEXT-->
Doc #1310

Document #1309; February 19, 1955
Memorandum
Series: EM, AWF, Administration Series: Budget
The Papers of Dwight David Eisenhower, Volume XVI - The Presidency: The Middle Way
Part VII: "Nothing could be worse than global war"; January 1955 to May 1955
Chapter 14: "We must show no lack of firmness"

 

Two important points in connection with my weekly conference with Arthur Burns.1

(1). He is carefully watching developments in the building field and is holding conferences with government officials who have responsibilities affecting this activity. There has been a very extraordinary--even distressing increase--in the number of mortgages of 100% character with no down payment. There are various indirect things which Burns thinks may be done gradually to correct this and without changing specific regulations. He will keep me in touch.2

(2). The other subject has to deal with governmental procurement during the remainder of this calendar year. At my direction, he is to keep in touch with the principal procurers of governmental supplies, so that our buying to the largest extent possible counteracts anticipated declines in private activities.3

1 On this Saturday morning the President had met with Burns, Chairman of the Council of Economic Advisers, and Gabriel Hauge, Special Assistant to the President for Economic Affairs.

2 Eisenhower was not alone in his concern regarding the Administration's policy of offering liberal home mortgage terms in order to stimulate the building industry--a strategy that would become increasingly controversial in 1955. Some savings and loan spokesmen warned that the government had been unwise to offer liberal mortgage terms to stimulate residential building at a time when the market was already booming. Various real estate mortgage financiers, on the other hand, argued that more restrictive terms would reduce home construction and jeopardize the national economy. The Congress, in its deliberations on the Housing Amendments Bill of 1955 (S. 2126), would finally authorize an additional $4 billion for general FHA mortgage insurance--a provision not recommended by the Administration, and about which the President said he had "serious objections." Despite those objections, Eisenhower would sign S. 2126 into law on August 11, citing other provisions of the act which he declared "important and desirable" (see Congressional Quarterly Almanac, vol. XI, 1955, pp. 253-58; Public Papers of the Presidents: Eisenhower, 1955, pp. 777-80; Reichard, The Reaffirmation of Republicanism, pp. 122-24; New York Times, Feb. 26, Mar. 9, 10, 11, 22, Apr. 3, June 19, 1955).

3 Eisenhower was concerned about the economic effect of a marked decline in purchases by the federal government in 1954. Due primarily to a reduction in national security outlays, government purchases had totaled only $50.1 billion in 1954--down $10 billion since 1953 (see Economic Report of the President, 1955, pp. 115-17). Burns had addressed this issue in a recent speech. He had suggested that continued expansion of state and local expenditures would probably offset the decline in federal spending in 1955 (New York Times, Feb. 1, 1955).

Bibliographic reference to this document:
Eisenhower, Dwight D. Memorandum, 19 February 1955. In The Papers of Dwight David Eisenhower, ed. L. Galambos and D. van Ee, doc. 1309. World Wide Web facsimile by The Dwight D. Eisenhower Memorial Commission of the print edition; Baltimore, MD: The Johns Hopkins University Press, 1996, http://www.eisenhowermemorial.org/presidential-papers/first-term/documents/1309.cfm

<--PREV
Doc #1308		  |  Memorial Commission
Home Page		  |  First Term
Table of Contents		  |  Presidential Papers
Home Page 		 | 
Doc#
 |  NEXT-->
Doc #1310
 


Dwight D. Eisenhower Memorial Commission
1629 K Street, NW Suite 801
Washington DC 20006
Phone: 202.296.0004    Fax: 202.296.6464