controls, has found many advocates. The idea of employing OPA methods of price control without rationing would be patently stupid. The establishment of maximum prices which are below free market prices and not coupled with official rationing would create a strong excess demand and would force distribution of the goods to be accomplished through private rationing techniques of retailers favoritism or through first-come-first-served techniques standing in lines or through secret price premiums black markets. Hence, rationing by the government would have to be introduced in order to permit an orderly distribution of the commodities, which would all be scarce at prices fixed below the free market level. In peacetime, without the strong feeling of urgency in the striving for a universally accepted goal, such a system would provide increased incentives to consume the goods, reduced incentives to produce them, increased incentives to break the law, increased incentives to enforce red tape, increased incentives to use arbitrary power and restrict individual freedoms. It would be a disequilibrium system, making shortages and excess demand a chronic condition, without hope for correction and with increasing difficulties of enforcement. It is not intended here to oppose rationing of anything under any circumstances. One may make a plausible argument for resorting even in peacetime to direct controls for a few selected things under very specific circumstances; to wit, (i) if the object of control is a necessity (such as bread, not meat), (2) if the elasticity of its supply in the short run is practically zero, (3 ) if the elasticity of demand for it is very low, and (4) if it can be reasonably and safely expected that the will be over soon, for example, because demand at the controlled price will greatly decrease or supply greatly increase in the very near future. One may conceivably even argue, although less plausibly, for a general price reduction scheme with general rationing if there is evidence that the reduced prices will within a very brief time be the equilibrium prices owing to an imminent decline in demand or increase in supply. No sound argument, however, has thus far been presented to justify direct controls to enforce a general roll back of prices if neither a decline in demand nor an increase in supply is in sight. From this point of view, the United States is not in an emergency expected to pass quickly. We cannot expect a drastic reduction in demand in the near future nor do we wish for it -and production is now at a rate as high as we can possibly maintain.

much less than it was in the estimates Barger used. Thus, the level of our pay roll series in all years, as well as the movement since I939, is independent of Census data except for a small part of the total. Social security data, the principal source of information on compensation of employees, is not used in arriving at the final product aggregates. In fact, the statistical interdependence between the annual Commerce income and product estimates, aside from certain wash items, like domestic service pay rolls which appear on both sides of the account, is largely restricted to the movement of some major portions of the two aggregates prior to I939 and to some overlapping of sources as between the estimates of personal consumption expenditures and those of income of unincorporated enterprises. This is not, of course, to deny the probability that many firms report the same figures to various collecting agencies, even though they may be erroneous. Neither does it deny that the investigator, when in doubt as to the best estimating procedure or faced with conflicting evidence, properly examines any related data referring to the opposite side of the account for supplementary guidance.