HHFA's ffloson Soys Los Angeles Hos Xlost to Lose if Congress

Posses Inflotionory Bills

Housing Administrator Norman P. Mason warns against the danger to the average American's living costs of "spending" our way out of the prosperous level of homebuilding that we have now achieved. Speaking to business and professional leaders at the Town Hall luncheon March 77 in the Biltmore, in Los Angeles, Administrator Mason said that Los Angeles, as one of the largest areas of homebuilding in the country, has the most to lose by inflationary spending schemes in housing bills before the Congress.

"I think we can learn a few things if rve look back at what has happened during the past year. A year ago at this time private home-building had dropped to the lowest rate since 1949. By December of last year it had bounced back to the second highest rate since the Korean boom year of 1950.

"The situation is quite different today than it was a year ago. Industrial production has risen to a high level and general economic activity has steadily expanded. Housing costs that were declining a year ago are now again on the rise. Stimulants administered to a patient when he is ailing become the wrong medicine to prescribe after he has recovered.

"Yet some of the housing proposals before Congress would continue to resort to deficit financing to over-stimulate construction generally not only this year but through many years ahead," Mason declared.

"There are many factors, of course, that affect the housing economy, including the increasing pressure for greater expenditures in the national defense ar-rd in missile development.

lnvestigotion Neqrer Home

"Featherbedding" practices in the construction industry, outmoded building codes and new cost-cutting house designs are among the subjects expected to be investigated by a special Cabinet committee on inflation, headed by Vice-President Nixon, reports "The Lumber Letter" of the National Lumber Manufacturers Assn. The committee's primary purpose will be to spotlight the factors responsible for increasing costs and prices, and to encourage public and private policies designed to curb inflationary pressures.

"But it is a fallacy to think that inflation points the u'ay to increased production in housing, or any other field. The fact is that when you cheapen the dollar, you automatically raise the cost of housing and all a family's normal living expenses, too. And as costs rise, the housing market eventually shrinks.

"We have excellent prospects this year, and in the years to come, to mairrtain a prosperous level of homebuilding, and to do so with relative stability in prices. But that calls for prudence and restraint in Governmental expenditures," Nlason continued.

"The Administration has already proposed to Congress one of the largest money bills for urban renewal and housing support in recent years-totaling an ultimate expenditure of $1,660,000,000. This amount has been calculated to give strong support to urban improvement and housing growth, without inflationary effect and within the means of the Federal Government and the taxpayers.

"Ilut other bills tell a different story. The bill passed by the Senate would more than double the ultimate outlay, and thc bill in the House is even larger. In addition, both billsparticularly the House bill-contain greatly liberalizecl specializing in the wholesale ilistribution of Redwood Upper Grades

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