SOME VERSION of wage and price control is now the publicly acknowledged political position of the international financial community and its immediate ideological dependents. Central bankers assembled in conferences of the International Monetary Fund or most recently in a ceremonial meeting of the BIS (Bank for International Settlements), emboldened by the near collapse of the U.S. stock market, imperiously insist on an American "controls" policy, already imposed, under pressure from U.S. financiers, in France and Britain. Dozens of liberal congressmen recite the "wage and price control" axiom, although most don't own the foggiest notion of the what and why of "controls." They aim to convince, at least themselves, that the recent stock market plunge concident with an accelerating strike wave has not left them politically paralyzed.

The New York Times editorializes in favor of controls. And it provides ample space for John Kenneth Galbraith to proudly repudiate his own somberly submitted Keynesian advice of five years ago. Apparently, mere juggling with government spending and tax rates has given way to a far more explicit policy of regulation.

A standing ovation for regimented economics from these quarters was generally predictable. However, a recent Gallup Poll reports that 48 per cent of the American population also favors a controls policy: it is clear that some substantial layer of wage-earning America endorses a policy that would. at minimum, hold wage rates to their current inadequate levels. (Real wages have been declining since 1965.) This kind of coalition of employees with their employers begs answers to two leading questions: 1) Who is deluded? and 2) What is the appropriate response to the social irony of people willing to sacrifice both wage dollars and the whole established institution of collective bargaining for some sense of economic and social stability?

Who is deluded? The 48 per cent indubitably. History records as bitter experience the three main practical trials of the Controls Policy. The NRA of the early New Deal years focused its incomes engineering on the wages problem. It managed a limited success by "spreading the work"-that is, by employing more workers at regulated, reduced hourly rates for fewer hours, thereby reducing the total wages bill charged against business income.

After that, certain concessions were made to the notion of also controlling the more conspicuous greed of the average industrialist.

If instead we look to the contemporary record of the De Gaulle-Pompidou or Wilson-Jenkins austerity regimes in France and Britain respectively. instituted in response to inflated currency difficulties similar to those confronting this country plus a heavy dose of U.S. financial pressure, we discover levels of living roughly equivalent to the more successful U.S. ghetto dweller, with newer and more severe restrictions imminent for England under the present Tory regime.

Most instructive, however, is the extensive, comprehensive wage-price regulation of the immediate post-war Marshall Plan period. Then, as now, the problem, as perceived by international banking interests, centered on deflating European and American currencies. These currencies were bloated both by the actual physical destruction of the economies thef nominally represented, and by five years of unrestricted war credits (financed with astronomical tax rates and wage controls which held U.S. income levels at their 1939 depression low). Otherwise, those currencies, subject to a 200 per cent rate of inflation in 1946-48 were worthless as instruments of trade or investment. For a brief, terrifying time it looked as if the world economy would revert to its pre-war depression state, complete with a breakdown in world-wide trade and investment.

The elegant secret of that period's "miraculous" economic revival was a wages and prices or "incomes" policy established as follows: European monies were devalued and mortgaged to the U.S. government and private investors so that the prices of all European commodities, including the price of labor, expressed in dollars was extremely low-low enough, that is, to compel most European working people to subsist on diets less nutritious than those consumed in 1939. Marshall Plan administrators would only extend urgent aid to those governments (France in 1948, for example) which agreed, first of all, to subject their population to an austere wages and tax policy. Secondly, these countries were to restrict commercial credit in such a way as to prevent speculation in the value of national currencies and in inventory accumulation (i.e.by corporations holding finished products in anticipation of inflationary price hikes). Such speculation would have tended to subvert national economies and make them less attractive as arenas for U.S. investment purchases.

TWO CONCLUSIONS are in order First: Price-stabilization measures, as conceived by those proposing them today, are derived consequences of a policy of reducing real wages. Inflation, and the agonizing insecurity it generates is thus modified at the expense of workingmen's incomes. The 48 per cent who believe otherwise, who anticipate some relative improvement due to a leveling off in prices, will be inevitably disappointed. at the expense of workingmen's incomes.

Second: When employers and employees apparently hold a shared anxiety about inflation, they are actually talking in different tongues. Wage-earners are debating alternative remedies for accelerating material decay, expressibly both as a decline in the personal wage-salary revenues and impoverishment of generalized social welfare equipment (schools, transportation, health facilities, etc.)-the furniture of social life.

As far as the world's banking federation is concerned, wage and price control represents an elementary remedy for monetary-instability/ depression threats. That is, the problem of inflation, in their view, consists of improving the profitability of currencies as investment purchases (not the speculative return on hot money exchanged in the money marker). The actual material not reflected in inflated money concerns them only peripherally, as a limiting factor. The simple device of "holding the line" on wages can augment rates of return on currency (in this case the dollar) and abort speculative runs against the endangered currency. In other words, the only available way for banking groups to stabilize the exchange rates (prices) of any commodity, including the currency commodity, is to increase its "power" over actual material wealth through appropriating, as the proceeds of investment, wealth otherwise accruing to working people as wages.

U.S. administrations, beginning with the inflation-balance of payments crisis of the Kennedy Administration, have chosen to attempt the same currency stabilizing process by a subtler route: through a rising rate of wage taxation, while permitting free-floating collective bargaining, tempered with the social restraint of conditioned, "captured" labor movement leadership.

However, the near collapse of the U.S. (and Japanese) stock market together with a steady continuing deterioration in the liquidity position of the dollar, plus the reluctant relative militance of labor leaders under fire from the rank and file, inspired anxious financiers collected in Brussels last month to renew demands for stiffer doses of the control medicine in the U.S. itself. Indeed, given the institutionalized vacillation in Washington on tax and spending austerity measures (the Congressional cave-in summarized in the tax reform collage of last year and the Nixon Administration's surrender to cost-plus defense contractors) leading financial circles have despaired of any other solution but a direct wage and price control arrangement.

HOW TO RESPOND to the "New Economics"? An "income" policy of some sort is indisputable on everybody's agenda. But there is a point of departure that veers sharply from that of central banking organizations. Begin with a wage level that is the equivalent of those consumables (a certain quality of housing, education, food and clothing, recreation and health, etc.) required by working people to perform the creative, skilled work associated with our most advanced technologies (presently tied up in military, aerospace and related junk production). In other words, there is a need to "control" wages so as to have them correspond to our productive potential -that is, to adjust living levels so as to prepare not only presently employed but future productive generations to operate the already predictable technologies of tomorrow. After that, one would estimate the quantity and quality of the productive apparatus necessary to meet that "bill of consumption" or "controlled wages" plan. Then we can look at actually available resources (plant, equipment, raw materials, etc.) and shift that portion of them currently invested by major financial and industrial interests in waste of all kinds (military and aerospace, advertising and bureaucracy, real estate and currency speculation, etc.) into creating the equipment needed to meet a rational wages plan.

And this kind of wages and investment control policy is at the same time a price regulating device. Enlarged, more efficient production on the basis of advanced technique-as well as eliminating Federal Reserve-generated commercial credit sunk in foreign and domestic speculation, waste and usury-would tend to first stabilize, then rapidly reduce commodity prices. In the end, this "control policy of a new type" resolves the currency-inflation dilemma that remains the centerpiece of those control proposals submitted by ruling financiers.

Indeed, if we want to speak in terms familiar to the banking community, we might say that the immediate political future is a question of whether monetary crises are to be settled through a combined process of devaluation and wage constriction or through a wages policy designed to alleviate material deficiencies based on adjustments in investment flows including arresting the explosion of hot air credit.

The rate of inflation of delusions about inflation exceeds the current rate of inflation. We simply say this: First, at this time of intolerable interest rates, business contraction, layoffs and cost-cutting of all varieties by employers large and small, it would represent the consummate foolishness to relinquish now traditional liberties associated with collective-bargaining and trade-unionism, by either organized or organizing working people. Next, every control measure (even partial ones) recommended in the months ahead, especially likely after the November elections, should be submitted to the following kind of test, using the New York Lindsay administration for illustration. Is the Mayor's current rent re-adjustment plan (netting an immediate 15-25 per cent rent increase) coherent with his parallel suggestions for wage and price controls? Is the Mayor willing to halve the price of housing in return for some freely agreed upon wage restraint? In that way, it is possible to know, in each specific case, just where things stand.

The Nixon regime, already discredited by the Cambodia misadventure and its demonstrated hostility towards labor (via its official strike-breaking activity in the postal, railroad, and G.E. outbreaks), sensing a sudden, premature retirement, is too nervous to legislate controls. The liberal opposition is too interested in November to bare its heart. The political environment is right for introducing an altogether new type of "Control Policy."( The author, a 25-year-old Temple University graduate, is one of the founding members of the National Caucus of Labor Committees. )