THE LATEST MEMORANDUM to President Carter on inflation is one of the more interesting of the recent leaks from the White House. Sometimes leaked documents are important because they foreshadow changes in policy; this one, unfortunately, doesn't belong in that category. Sometimes leaks reveal deep internal debates over major decisions; but this one isn't that sort either. It deserves notice simply because it lists some of the things that a president can do, and ought to be doing now, to hold down the inflation rate. The signals of future trouble with prices are not passing unnoticed, evidently, at the White House. Two months ago Mr. Carter spoke of anti-inflation policy. But under the pressure of various crises and necessities, he has neglected it ever since.
Mr. Carter's approach to inflation has taken a form that seems increasingly to be characteristic of this administration.He set goals, trimmed them with rhetoric, and then went off to other things as though those goals were somehow going to achieve themselves without further attention. Nothing is less likely. Working down an inflation rate is one of the most difficult and painful of exercises for any government. It's not Mr. Carter's original plan for shaving down the inflation rate that's wrong. It's the absence of any follow-through. The administration keeps finding itself in jams, the solution to each of which is bought with a little more inflation.
One current example is the coal strike. The administration badly wants to get it over. The settlement would raise wages 37 percent over three years. But the administration has been leaning on the companies to be accommodating and get the miners back to work. That's going to make it awkward for the president to do much when the electric utilities and the steel makers raise prices, over the next year or two, to pass on the higher costs of fuel.
Another example is the relation between the newest farm bill and the ratification of the Panama Canal treaties. It was only last summer when Congress enacted the comprehensive revision of the farm legislation. But this winter farmers have been protesting low prices and angrily lobbying Congress. Now other expensive bills are moving along in the Senate. Emergency loans to the farmers are justified, but these bills would provide huge increases in payments to farmers to cut production. That is exactly the wrong road to take, and would lead to steep increases in food prices ahead. But the administration has been anxiously bartering for senator's votes on the treaties, and it is evidently dropping its opposition to these additional farm payments despite the inflationary implications.
The leaked memo to Mr. Carter came from Barry Bosworth, the head of his Council on Wage and Price Stability. He offered an inventory of suggestions for restraining costs of both labor and goods. The president could hold down the federal pay increases to set an example. He could require regulatory agencies to compute the inflationary effects of their decisions. He could try to rescue his bill to control hospital costs; it's currently stuck in a House subcommittee. He could expand meat imports, as a check on prices that have been going up exceptionally fast in recent months. These proposals are neither new nor radical. They are only examples of a much longer list of actions and positions that a determined campaign against inflation would require.
When Mr. Carter first campaigned for election, he was the only Democratic candidate who strongly emphasized the urgent need to control inflation. That is one of the reasons he won the nomination. But since he took office he has been dealing with smaller constituencies with their narrowly focused demands. In one decision after another, long-term wage and price stability is getting a second priority as he tries to resolve the crises of the moment. Mr. Carter keeps saying that he still believes in holding down inflation, as a general position. True, but a general position doesn't count for much when all of the specific cases go the other way.