OF THE PRESIDENT

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chipping away at tariffs and other trade barriers can provide assuranceagainst backsliding. Pressures for protection must be successfully resisted.The fruits of unprecedented prosperity are still not being fully shared bymany nations in Africa, Asia, the Middle East, and Latin America. Thefuture growth of these nations must be built primarily on the skills, intelligence,and labor of their citizens. But the developed countries must facilitatethe process by providing technical assistance, capital resources, and accessto markets.The international monetary system established at Bretton Woods anddeveloped through the years has made a major contribution to internationaleconomic growth. This system has served the world well, but it hasincreasingly been subject to serious strains.To ensure the continuing smooth operation of the monetary system, workmust go forward on the problems of liquidity, confidence, and adjustment.Great progress has been made in recent years as exemplified by the agreementcreating Special Drawing Rights. This achievement required carefulstudy and long negotiations. Similar extensive efforts will be needed in thefuture if progress is to be maintained, but the prospects for eventual successare bright.150
Chapter 5Combating Poverty in a Prosperous Economy. . . the policy of the United States [is] to eliminate the paradox ofpoverty in the midst of plenty in this Nation by opening to everyonethe opportunity for education and training, the opportunityto work, and the opportunity to live in decency and dignity.FOR OVER 4 YEARS the United States has had an explicit nationalcommitment to eliminate poverty in our society, a commitment enunciatedby the President in the State of the Union Message of 1964 andconfirmed by the Congress in the above words later that year in the FconomicOpportunity Act.Americans are increasingly prosperous. Median family income in theUnited States (in constant 1967 prices) rose from $6,210 in 1959 to$7,974 in 1967, a gain of 28 percent in 8 years. Yet many families are stillnot able to attain minimum living standards. A preliminary estimateindicates that in 1968 about 22 million people lived in households withincomes below the "poverty line." While this is far fewer than in the past—more than 40 million were similarly situated in 1960—too many Americansremain poor.This chapter examines the recent progress in reducing poverty, the natureof the task that remains, and the strategies available for eliminating poverty.<strong>THE</strong> EXTENT <strong>OF</strong> POVERTYA family is "poor" if its income is insufficient to buy enough food, clothing,shelter, and health services to meet minimum requirements. Universallyacceptable standards for determining these minimum needs are impossibleto formulate since the line between physical necessities and amenities isimprecise.The social and psychological aspects of poverty further complicate effortsto measure poverty. As average incomes rise, society amends its assessmentof basic needs. Individuals who cannot afford more than a small fractionof the items enjoyed by the majority are likely to feel deprived. Consequently,an absolute standard that seems appropriate today will inevitably berejected tomorrow, just as we now reject poverty definitions appropriatea century ago.
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ECONOMIC REPORTOF THE PRESIDENTMM '
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CONTENTSPageECONOMIC REPORT OF THE
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ECONOMIC REPORTOF THE PRESIDENT
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• We must find a way of combining
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third. Only 5 percent of manufactur
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• It provides funds for our conti
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THE ROADS TO AVOIDWe stand at a cri
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cussion on the wage-price problem.
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AFTER VIETNAMDespite some encouragi
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Myths about gold die slowly. But pr
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QUALITY OF THE ENVIRONMENTMore than
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is a staggering $5 billion. Recent
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the Business Sector is a promising
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impatient. This feeling is in the g
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LETTER OF TRANSMITTALCOUNCIL OF ECO
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CHAPTER 2. POLICIES FOR BALANCED EX
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TablesPage7. Measures of Economic A
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The remainder of this chapter revie
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With higher employment and more rap
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FISCAL POLICYThe economic backgroun
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Federal Reserve policy continued to
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over $10 billion (annual rate) from
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foi> new houses. Only in the fourth
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WAGES AND COMPENSATIONSpurred by ri
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Output per manhour in the private e
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TABLE 6.—United States balance of
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all of which stimulated metal impor
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e to prolong the slack performance
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desired, at a considerably more mod
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eludes other modest increases in pu
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investment should be another source
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would not be produced, and some res
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countries, our competitive position
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in the composition of the working-a
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TABLE 7.—Measures of economic act
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assist such workers, who often suff
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and hence consumer expenditures, by
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THE RECORD OF POLICYis the performa
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Chart 7Selected Interest RatesPERCE
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policy can be implemented either th
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stronger than had been anticipated,
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allocation of resources between Fed
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ADJUSTING TO NEW DEVELOPMENTSUnder
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may also be market imperfections or
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cases involving more than half the
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y keeping variations in the rate of
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There is, of course, good reason to
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Chapter 3Price Stability in a High
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increases exercises much less disci
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price stability. The relationship b
Page 106 and 107: TABLE 10.—Changes in employment,
Page 108 and 109: or metropolitan area. Greater recip
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Page 112 and 113: The New Careers Program, administer
Page 114 and 115: industries of critical economic imp
Page 116 and 117: Legislative Achievements and Propos
Page 118 and 119: Natural Gas. This important fuel ha
Page 120 and 121: Competitive ProcurementBecause comp
Page 122 and 123: nounced. Fifteen percent of the far
Page 124 and 125: pursuits. If these interindustry sh
Page 126 and 127: Recognizing this situation, the Cou
Page 128 and 129: merous structural improvements, and
Page 130 and 131: ECONOMIC GROWTH AND WORLD TRADEIn t
Page 132 and 133: The GATT rules are interpreted as p
Page 134 and 135: technical assistance from both publ
Page 136 and 137: TYPES OF RESERVESExisting stocks of
Page 138 and 139: Chart 9World Trade and ReservesBILL
Page 140 and 141: time. At different times in 1968, t
Page 142 and 143: eligible official sterling reserves
Page 144 and 145: are. In part, this is because major
Page 146 and 147: There are limits on the willingness
Page 148 and 149: tions could occur if exemptions wer
Page 150 and 151: method had to be found to ensure th
Page 152 and 153: associated with parity adjustments
Page 154 and 155: to buyers in world markets. Imports
Page 158 and 159: DEFINITION OF POVERTYEven a rough m
Page 160 and 161: Chart 10Number of Poor Persons and
Page 162 and 163: the annual decline in the number of
Page 164 and 165: y providing more jobs for elderly i
Page 166 and 167: poor grow only at the same pace as
Page 168 and 169: EDUCATION AND POVERTYEducation can
Page 170 and 171: The rapidly growing public sector h
Page 172 and 173: public assistance should not be det
Page 174 and 175: of the food stamp program will expa
Page 176 and 177: mostly domestics, agricultural empl
Page 178 and 179: enefits must be provided to middle-
Page 180 and 181: Total Employment. Most jobs are in
Page 182 and 183: Three considerations bear on the ch
Page 184 and 185: velopment activities. Loans, grants
Page 187: REPORT TO THE PRESIDENTFROM THE CAB
Page 191: CONTENTSPageSUMMARY OF FINDINGS 189
Page 194 and 195: Chart 1Federal Purchases for Nation
Page 196 and 197: As revenues expand in a growing pea
Page 198 and 199: 1. The armed services would decline
Page 200 and 201: Chart 3Illustrative Paths of Defens
Page 202 and 203: 3. For the same reasons, the Depart
Page 204 and 205: the Cabinet Committee on Price Stab
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lion at 1968 prices, as shown in Ch
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Maintaining Standards Under Cash Be
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TABLE 3.—Illustrative new program
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An alternative major program initia
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separations averaged about 470,000
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financial base of the system. And m
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Appendix AREPORT TO THE PRESIDENT O
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Report to the President on the Acti
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Continuing its practice of asking l
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Appendix BSTATISTICAL TABLES RELATI
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Production and business activity:Pa
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NATIONAL INCOME OR EXPENDITURETABLE
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TABLE B-2.—Gross national product
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TABLE B-3.—Implicit price deflato
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TABLE B—6.—Gross national produ
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TABLE B-10.—Personal consumption
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Year orquarter192919301931193219331
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TABLE B-14.—Relation of national
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TABLE B-16.— Total and per capita
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TABLE B-17.—Sources of personal i
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TABLE B-19.—Saving by individuals
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POPULATION, EMPLOYMENT, WAGES, ANDP
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TABLE B-22.—Noninstitutional popu
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TABLE B-24.—Selected unemployment
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TABLE B-26.— Unemployment insuran
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TABLE B-27.—Wage and salary worke
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TABLE B-29.—Average gross hourly
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TABLE B-31.—Average weekly hours
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TABLE B—33.—Average weekly earn
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PRODUCTION AND BUSINESS ACTIVITYTAB
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TABLE B—37.—Industrial producti
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TABLE B-39.—Business expenditures
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TABLE B-40.—New construction acti
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TABLE B-41.—New housing starts an
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TABLE B-4r3.—Manufacturers' shipm
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PRICESTABLE B^-5.—Consumer price
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TABLE B-47.—Consumer price indexe
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TABLE B-48.— Wholesale price inde
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TABLE B-49.—Wholesale price index
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1929 5.1930 5.1931 5.1932 ».1933 5
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TABLE B-53.—Federal Reserve Bank
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TABLE B-54.—Bond yields and inter
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TABLE B—56.—Instalment credit e
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TABLE B-58.—Mortgage debt outstan
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GOVERNMENT FINANCETABLE B-60.—Fed
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TABLE B-61.—Federal budget receip
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TABLE B-63.—Receipts and expendit
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End of year ormonth1939 ._..1940_19
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TABLE B—67.—Receipts and expend
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TABLE B-69.—State and local gover
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TABLE B—71.—Sales, profits, and
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TABLE B—72.—Relation of profits
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TABLE B—74.—Current assets and
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TABLE B-76.—Common stock prices,
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AGRICULTURETABLE B—78.—Incomefr
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TABLE B-80.—Farm population, empl
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TABLE B-81.—Indexes of prices rec
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TABLE B-83.—Comparative balance s
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TABLE B-84.—United States balance
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TABLE B-86.—United States merchan
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TABLE B-88.—International reserve
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TABLE B-90.—Price changes in inte
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