The great economic strength of our democracy has developed in an atmosphere of freedom.  The character of our people resists artificial and arbitrary controls of any kind.  Direct controls, except those on credit, deal not with the real causes of inflation but only with its symptoms.  In times of national emergency, this kind of control has a role to play.  Our whole system, however, is based upon the assumption that, normally, we should combat wide fluctuations in our price structure by relying largely on the effective use of sound fiscal and monetary policy, and upon the natural workings of economic law.

Moreover, American labor and American business can best resolve their wage problems across the bargaining table.  Government should refrain from sitting in with them unless, in extreme cases, the public welfare requires protection.

We are, of course, living in an international situation that is neither an emergency demanding full mobilization, nor is it peace.  No one can know how long this condition will persist.  Consequently, we are forced to learn many new things as we go along-clinging to what works, discarding what does not.

In all our current discussions on these and related facts, the weight of evidence is clearly against the use of controls in their present forms.  They have proved largely unsatisfactory or unworkable.  They have not prevented inflation; they have not kept down the cost of living.  Dissatisfaction with them is wholly justified.  I am convinced that now—­as well as in the long run—­free and competitive prices will best serve the interests of all the people, and best meet the changing, growing needs of our economy.

Accordingly, I do not intend to ask for a renewal of the present wage and price controls on April 30, 1953, when present legislation expires.  In the meantime, steps will be taken to eliminate controls in an orderly manner, and to terminate special agencies no longer needed for this purpose.  It is obviously to be expected that the removal of these controls will result in individual price changes—­some up, some down.  But a maximum of freedom in market prices as well as in collective bargaining is characteristic of a truly free people.

I believe also that material and product controls should be ended, except with respect to defense priorities and scarce and critical items essential for our defense.  I shall recommend to the Congress that legislation be enacted to continue authority for such remaining controls of this type as will be necessary after the expiration of the existing statute on June 30, 1953.

I recommend the continuance of the authority for Federal control over rents in those communities in which serious housing shortages exist.  These are chiefly the so-called defense areas.  In these and all areas the Federal Government should withdraw from the control of rents as soon as practicable.  But before they are removed entirely, each legislature should have full opportunity to take over, within its own State, responsibility for this function.