CONCLUSIONS AND APPLICATIONS
IN the light of our wartime experience, what can be said about the possibility of successful price control either in wartime or in peace? With reference to war, the question is not whether price control is desirable, but what are the means by which price control can be made more effective. A major war requires such wide and rapid adjustments in the national economy that some interference with the workings of the autonomous price system are inevitable. In time of peace, however, it is still important to ask what are the circumstances under which such interference may be either justifiable or successful.
The chief criticisms which must be raised against our financing policy during the War reveal a failure on the part of the Treasury to appreciate the fundamental economic problem of the War. There was no attempt to integrate the financing policy with the transformation of the economy to a wartime basis. The Treasury knew that money had to be raised, and that if money could not be obtained elsewhere it could be had from the banks; but it showed no understanding of what lay behind the money veil. If the Treasury had vigorously tried to reduce the use of credit, both banking and private, in nonessential production, and if it had tried to devise a tax policy which would encourage the diversion of necessary resources to military use, the solution of the war problem would have been greatly facilitated. Also, the excessive reliance upon certificates showed a lack of boldness and a too ready acceptance of the easiest financing method.
There is one essential contrast between the wartime attempt to control credit expansion and what seems a similar peacetime case, the desire to curb an inflationary