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itating this process. (3) The third major require-
ment is that some procedure be introduced whereby
the international propagation of cyclical fluctua-
tions and a consequent cumulative contraction in
world trade may be most effectively prevented.

Domestic Measures Recommended

The report recommends that each member gov-
ernment sliould take early action along the follow-
ing lines:

1. A full employment target should be adopted
and announced which will be the standard to which
national employment stabilization measures will
be directed. In industrialized countries, targets
should be defined in terms of unemployment rather
than employment, and should be expressed in terms
of the smallest percentage of unemployment of
wage earnei-s which the country in question can
reasonably hope to maintain in the light of sea-
sonal movements and in the liglit of structural
changes in the economy, which inevitably give rise
to some temporary unemployment that cannot be
eliminated through public policy. According to
the circumstances of each country, this target may
be defined as a range rather than an exact figure
(e.g. from 2 to 4 percent or from 3 to 5 percent of
the vi'age earners). The term "unemployment"
should include all workers without work and seek-
ing work as wage earnei'S and should include an
allowance for the full-time equivalent of time lost
by all wage earners working part time but willing
and able to work full time. In countries where
industrial development is not far advanced and
where workers who lose their jobs in industry are
absorbed in agricultural pursuits, it may be desir-
able to define the target in terms of the volume of
industrial employment rather than in terms of
percentage of unemployment. In that case, the
target figure could be raised year by year in accord-
ance with industrial growth.

2. A comprehensive program should be an-
nounced with regai'd to fiscal and monetary poli-
cies, investment and production planning, and
wage and price policies. This program should

include adaptation of the fiscal policy of the state
to tlic needs of full employment; measures to con-
trol the rate of private investment; planning of
public investment ; measures to stimulate consump-
tion, such as changing the incidence of taxation
and lowering its level; expanding programs of
social security and transfer payments; raising
standards of social expenditures, such as educa-
tion and health; price control; and measures for
maintaining incomes in agriculture.

3. An appropriate system of mandatory com-
pensatory measures should be adopted and an-
nounced. These would be applied to expand
effective demand and would be automatically ap-
plied should the stabilization program fail to
prevent unemployment from exceeding the target
limit by a predetermined amount for 3 successive
months. It is essential, the experts believe, that
methods be devised whereby countermeasures come
into effect at an early stage on an automatic basis.
The automatic compensatory measures should
embody the following necessary features: first,
they should be capable of raising effective demand
promptly throughout the economy; second, they
should be of a quantitative nature so that their
effect on demand and employment could be esti-
mated with a fair degree of reliability ; third, their
quantitative magnitude should be sufficient to re-
duce the level of unemployment (taking into ac-
count both primary and secondary effects) to the
mean percentage of the full-employment range.
The detailed design of automatic compensatory
measures should be undertaken by each countiy
in the light of its own economic structure and the
possibilities afforded by its fiscal and administra-
tive systems.

In industrially advanced countries, the most
appropriate method would be to make advance
legislative provisions for alternative tax sc'hed-
ules, the lower of which could come into operation
in circumstances defined in the legislation. The
most suitable tax for this purpose in those coun-
tries is the i>ersonal income tax on earned incomes,
and the legislative provision should be either for
alternative rates of such taxation or for alterna-
tive levels exemptions. Similarly, social security
contributions could be varied and advance legis-
lative authorization could be given for their com-
plete suspension in prescribed circumstances. Or
legislation might be enacted under which the or-
dinary social security contribution is automat-
ically reversed and replaced by period payments

April 17, 1950


to both employers and employees on a predeter-
mined basis. In countries where neither the per-
sonal income tax nor the social security system are
widely developed, an analogous system could be
introduced in the form of predetermined varia-
tions in the general sales or purchase taxes. Com-
pulsoi'y savings arising out of war or compensa-
tions for war damage could be legislatively so
adapted that their release is made dependent on
similar predefined circumstances. Some coun-
tries may find it possible to incorporate a counter-
cyclical public works program into an automatic
compensatory scheme although it might be difficult
to vary the program rapidly enough for this pur-
pose. At any rate, a i^ublic-worlvs program should
be a highly important part of a general and con-
tinuing stabilization program.

4. The nature of policies that will be adopted to
maintain price stability and combat inflationary
tendencies should be announced. If price stabili-
zation policies are to be effective and the general
full-employment objective preserved, it is essential
that the government be ready to employ a wide
variety of measures for dealing with price infla-
tion. According to their political and economic
institutions, some countries may wish to rely more
on indirect types of control, while others would
make a more widespread use of direct controls.
In both cases, the measures need to be adapted to
the particular cause of the rise in prices, and it
would not, therefore, be possible to legislate in
advance for any general measure that should auto-
matically come into operation in the case of infla-
tion. It is essential, however, that the government
should take such action, appropriate to each par-
ticular situation, for the preservation of price sta-
bility, as will check inflationary tendencies without
allowing an increase in unemployment above the
limit of the full employment target.

5. Legislative procedures, administrative organ-
ization, and statistical services should be adapted
to the implementation of the full-employment pro-
gram. Implementation of a full-employment pol-
icy along the lines of these recommendations would
not require any alteration in the political system
and institutions of any country, but each govern-
ment should review its organization and proced-
ures with a view to adapting them to facilitate the
preparation and execution of the measures. Some
countries would have to adopt enabling legisla-
tion. All countries should review their adminis-
trative organization to insure a coordination of

programs with responsibility clearly concentrated
in the appropriate executive organ of the govern-
ment. Governments must have at their disposal
analyses of the trends of the economic situation,
and there is a great need for improvement in the
collection and analysis of the statistical material
necessary for the guidance of full-employment

International Measures Recommended

Kecommendations in the international field serve
three main purposes : creation of a workable sys-
tem of international trade for a stable and expand-
ing world economy, thereby jiroviding conditions
required for elimination of undue trade barriers
and for restoration of convertibility of currencies ;
acceleration of orderly economic development of
underdeveloped areas ; and prevention of interna-
tional propagation of fluctuations in effective de-
mand. It is reconamended that early action be
taken as follows :

1. A program should be established, through the
auspices of the Economic and Social Council, to
eliminate present structural disequilibrium in
world trade. The experts recommended that
Ecosoc convene a meeting of interested govern-
ments to develop a joint program in this regard
and to consult together on the adjustments in do-
mestic and external policies that are required.
Participating countries should set targets for the
main items for their balances of payments, indicat-
ing how they hope to restore their over-all finan-
cial equilibrium within the period. The countries
should meet at frequent intervals to adjust their
targets and, as appropriate, make specific agree-
ments on major factors of common concern. Coun-
tries having deficits in their balances of payments
should undertake, as their main obligation, reduc-
tion of internal inflationary pressures which com-
promise their ability to export and aggravate their
need to import, to adjust their exchange rates when
expansion of expoi'ts is hampered by overvaluation
of their currencies, and to adjust their produc-
tion structure as the external market situation re-
quires. Countries having "surpluses" in their bal-
ances of payments should undertake as their main
obligations that a decrease in their exports or a
rise in their imports not give rise to internal dis-
locations which, in turn, generate reduced imports
with larger export surpluses; to reduce or remove
restrictions on imports and to refrain from unduly
encouraging exports. It is further recommended


Department of State Bulletin

that Ecosoc establish an expert advisory commis-
sion to do the detailed work in fornuilatiiig tarjicts
and suggesting teclmical needs for coordinating
national policies, to call the attention of the gov-
ernments to the problems arising, and to report to
the Council on progress made.

2. A stable flow of international investment
shoidd be created at a level appropriate to the
needs of the underdeveloped areas of the world
and to the capacity of the lending countries. It is
recommended that the articles of agreement of the
International Bank for Reconstruction and Devel-
opment be amended to permit the Bank to lend to
underdeveloped countries for the general purpose
of over-all development programs, as a normal
procedure. Lending countries should fix annual
targets for long-term international improvement
for 5-year periods covering both private and pub-
lic net investment and should report to the Inter-
national Bank each G months any deficiency in
their actual international lending as compared to
the target. The Bank should be enabled to use
the funds thus borrowed from governments for the
purpose of lending to other governments. This
operation would be conducted by a new and sep-
arate department of the Bank which would have no
recourse to the Bank's capital or its other resources
arising from the performance of its present func-

3. International trade should be stabilized by

maintaining external disbursements on current
account in tlie face of internal ilucl nations of eflfec-
t ive demand. This would be accomplished, in part,
by the preceding reconunendation on investment.
The experts further propose, in tiiis regard, that
any country whose imports diminish because of a
failure to maintain full employment should be
required to deposit with the International Mone-
tary Fund an amount of its currency approxi-
mately equal to the decrease in imports resulting
from its recession minus the decrease in its ex-
ports. These changes would normally be measured
from the preceding year. These funds would be
available to otlier countries to replenish their mon-
etary reserves so that they could continue the vol-
ume of their imports at approximately the former
level, notwithstanding the decline of their exports
to the country suffering a recession. They would
be enabled to do this by purchasing the currency
which the country suffering the recession has de-
posited with the Fund with their own currencies.
Although this would not maintain the current ex-
port of the recession counti-y's suppliers, it would
maintain their international liquidity. Thus, coun-
tries failing to maintain full employment and suf-
fering a recession would be cushioning other coun-
tries against the effects upon them of this failure ;
also, the country suffering the recession would be
benefited since the demand for its own exports
would be maintained at least in part.

Recent Releases

For sale bti the Superintendent of Documents, Oovernment
Printing Office, Washington 25, D. C. Address requests
direct to the Superintendent of Documents, except in the
case of free publications, ichich may 6e obtained from the
Department of State.

Universal Declaration of Human Rights. International
Orguaizntioii and Conference Series III, 20. Pub. 3381.
6 pp. 5^.

Revised text of statement of principles approved as
a common standard of achievement for all peoples
and all nations — by the General .\ssembly at its ple-
nary meeting on December 10, 1948.

Postwar Foreign Policy Preparation, 1939-1945. General
Foreign Policy Series 1.5. Pub. 3580. 726 pp. §2.25.

A record of the structure and conduct of the extra-
ordinary preparation of our postwar foreign policy
as made in the Department of State during World
War II.

Education: Cooperative Program in Paraguay. Treaties
and Other Interuational Acts Series 1".)91. Pub. 3711. 3
pp. 5(f.

Agreement between the United States and Paraguay
amending and extending agreement of March 8, 1V)4!) —
Effected by exchange of notes signed at Asuncion
July 26 and August 30, 1949; entered into force
September 1, 1949, operative retroactively July 1,

Weather Stations: Cooperative Program in Mexico.

Treaties and Other International Acts Series 1989. Pub.

3717. 13 pp. 50.

Agreement between the United States and Mexico
amending and extending agreement of October 13 and
30 and November 10, 1942 — Effected by exchanges of
notes signed at Mexico, D.F., May 12, June 16, 21 and
28, 1945; entered into force July 1, 1945; and agree-
ment effected by exchanges of notes — Signed at
Mexico, D.F., October 13 and 20 and November 10,
1942 ; entered into force November 10, 1942.

Weather Stations: Cooperative Program in Mexico.

Treaties and Other International Acts Series 1995. Pub.

3718. 8 pp. 5t

Agreement between the United States and Mexico
superseding previous agreements — Effected by ex-
change of notes, signed at Mexico, D.F., March 29
and August 15, 1949 ; entered into force October 20,
1949, operative retroactively from July 1, 1948.

April 17, 1950


Second I titer- American Statistical Congress

l>y Stuart A. Eice, Chairman, U.S. Delegation

At the invitation of the Government of Colom-
bia, the Second Inter- American Statistical Con-
gress was convened by the Inter-American
Statistical Institute (Iasi) at Bogota, January
16-27, 1950. The Iasi Executive Committee and
the Second General Assembly met during the
same period. The third session of tlie Iasi Com-
mittee on the 1950 Census of the Americas (Cota)
was also held in Bogota, January 9-21. The
general purposes of the Congress and related
meetings were to give consideration to ways and
means by wliich statistical methodology and skills,
and the administrative facilities and procedures to
implement tliem, may be more fully developed in
the nations of tlie Western Hemispliere, in order to
serve better both national and international needs
for statistical information.


Tlie Inter-American Statistical Institute was
founded during the Eighth American Scientific
Congress in Washington, in May 1940, by Western
Hemisphere members of the International Statis-
tical Institute. It is composed of individual titu-
lar (or elected) and ex officio members and insti-
tutional members (including governments). Its
purposes and functions are : to stimulate improved
methods of collection, tabulation, analysis, and
publication of statistics; to provide a medium for
professional statistical collaboration ; to encourage
improvements in comparability of economic and
social statistics; and to cooperate with national
and international statistical organizations. Under
an agreement with the Organization of American
States (Oas), Iasi will become affiliated on July
1, 1950, witli Oas as an Inter-American specialized
organization, and its secretariat will become the
Statistical Division of the Pan American Union.

Tlie First Inter- American Statistical Congress
was held in Washington in September 1947^ in

conjunction with the World Statistical Congress
convened by the United Nations, the 25th session
of the International Statistical Institute, and
meetings of other international organizations in
related fields, which together composed the Inter-
national Statistical Conferences. The first meet-
ing of the Cota was also held then to lay the basis
for agreement upon plans and specifications to be
followed in national censuses exi:)ected to be luider-
taken throughout the Western Hemisphere in

All except two (El Salvador and Honduras) of
the 22 countries of the Western Hemisphere were
represented at the Congress in Bogota by official
delegates or other participants.- A dozen inter-
national organizations, including the United Na-
tions, the Organization of American States,
International Labor Organization, Food and
Agriculture Organization, United Nations Edu-
cational, Scientific and Cultural Organization, and
the International Monetary Fund, were also repre-
sented. Altogether nearly 150 participants were
registered at the Congress, of whom more than
100 were from countries other than Colombia.
Many of the delegates from Latin American coun-
tries were persons who had received training in
statistics in the United States under cooperative
technical assistance projects.


The progi-am for the Congress was organized
around four broad subjects, for each of which a
working grouj) of delegates and participants was
constituted. Their functions were to formulate
specific i>roposals and draft resolutions for con-
sideration in plenary sessions. The working
groups in turn were subdivided and dealt with the
following topics :

' Bulletin of Dec. 7, 1947, p. 1084.

^ For the U.S. delegation see Bulletin of Jan. 23, 1950,
]). 141.

Department of State Bulletin

I. Statistical organization and administration :

(1) Iasi striu'tiiro and operation within the
Orfranization of Anioricaii States; regional oi"-
ojani/atioiis within tlio international statistical
framework; ('2) National tecluiical participation
in international statistical activities; (3) National
focal points as tools of statistical administration.

II. Statistical education and training:

(1) Statistical teaching; (2) Statistical vocabu-
lary; (3) Sampling and statistical methodology.

III. Demographic and social statistics:

(1) International migration statistics; (2) In-
ternational ilevelojiments in vital and health
statistics; (.'}) Educational and cultural statistics;

(4) Occupational classification.

IV. Economic and financial statistics:

( 1 ) Kelating current national statistics to 1950
census results; (2) Agricultural statistics; (3)
Foreign trade statistics; (4) Intlustrial statistics;

(5) Economic and financial statistics (including
national income and social accounts).

After adoption by the working groups, proposals
were reviewed in a plenary session of the Congress
and upon adoption in substance were referred for
editing to the Resolutions Committee. This com-
mittee was composed of the chairman and secre-
tary of each of the four working groups, the chair-
man and secretarj' of Cota, the Secretary General
of Iasi (ex officio), and a repi'esentative of the
Executive Committee of Iasi. A total of 30 draft
resolutions thus formulated (not including resolu-
tions of Cota) were considered and adopted by
the Congress at a closing plenary session. It is
possible to give here only a brief indication of the
substance of these resolutions. The full texts will
be published in a forthcoming issue of Estadistica,
the quarterly journal of Iasi; full proceedings of
the Congress will also be published by the Institute
in a separate volume.


In the field of statistical organization and ad-
ministration the Congress adopted recommenda-
tions aiming at (1) improved coordination of na-
tional statistical programs through centralization
of responsibility and authority for planning, de-
velopment of standards, allocation of specific sta-
tistical activities, avoidance of gaps in availability
of data, and prevention of overlapping and dupli-
cation; (2) more effective cooperation between
national governments and international organiza-
tions in the development of international statis-
tical standards and ])i'ograms; (3) defining more
precisely the role of Iasi in relation to the respon-
sibilities of United Nations and other interna-
tional organizations; (4) establishment within
Iasi of a new Connnittee on Improvement of Na-

tional Statistics (Coins) ; and (5) the encourage-
ment and further strengtiiening of national focal
points which have been designated in a number of
couiUries to facilitate international exchange of
statistical materials and information.

Specific measures for the improvement of sta-
tistical education and training were recommended
by the Congress in a sei-ies of resolutions dealing
with (1) organization of statistical teaching; (2)
preparation of mininunu standards for plans of
study for different types of statistical courses; (3)
promotion of efforts to make available needed
statistical textbooks in different languages; (4)
more effective collaboration between universities
and public statistical services; (5) the problem of
adequate pay and job security for statistical per-
sonnel; ((5) the provision of fellowships and other
forms of subsidies, exchange of teachers, and other
measures to encourage the training of teachers of
statistics; and (7) the preparation and publication
for general use of a multilingual vocabulary of
statistical terms. Increased support for existing
geographic and cartographic services and meas-
ures to promote more widespread utilization of
scientific methods of statistical sampling were also

In a group of resolutions dealing with various
aspects of demographic and social statistics, the
Congress formulated recommendations concern-
ing (1) the application of 1950 census data to
current national series of population estimates,
vital statistics rates, life tables, and migration ; (2)
improvement and development of vital and health
statistics; (3) standanls and definitions for statis-
tics of education and literacy and steps to improve
such measures as well as other cultural statistics;
(4) the development and improvement of occupa-
tional classification systems for population cen-
suses and other purposes and the maintenance of
comparability between occupational classification
systems used in various statistical fields; (5) pro-
posals for standardizing definitions and methods
of enumerating industrial or social status groups
in population censuses; and (6) the development
and improvement of labor statistics in countries of
the Western Hemisphere.

In the field of economic statistics, the Congress
adopted a series of resolutions making specific rec-
ommendations for the development and improve-
ment of national statistics on a number of
important subjects, including steps to integrate
current statistical programs with the inr)0 census
program. Recommendations on agricultural sta-
tistics included a "minimum list of topics" which
all countries of the Western Hemisphere were
urged to adopt for their current agricultural series,
as well as a more extensive list suggested to the
countries for study. Minimum standards were
also recommended for current series of industrial
statistics. Recommendations concerning statistics
of public finance, money and banking, balance of
payments, national income, and agricultural credit
were accompanied by ajipcndixes, "included for in-

Apnl 17, 1950


formation and technical reference," presenting
comments and suggestions as to topics which might
be inchided, definitions, and other questions. A
resolution on foreign trade statistics dealt with
steps toward the application of international
standards to foreign trade data, recommending
adoption by countries of the Western Hemisphere

Online LibraryUnited States. Dept. of State. Office of Public CoDepartment of State bulletin (Volume v. 22, Apr- Jun 1950) → online text (page 21 of 116)