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About La Grande observer. (La Grande, Or.) 1959-1968 | View Entire Issue (Nov. 5, 1959)
LA GRANDE OBSERVER
" " Observer, La Grande, Ore., Thuri., Nov. 5, 1959 Pag 9
Michigan Hit By New Financial
Ills As Unpaid Bills Piling Up
LANSING, Mich. a'PI '-Michigan
has reached a rcw peak of
There is talk of closing univer
sities, bringing state pol ce in off
the road, cutting welfare pay
ments, laying off thousands of
state employes and more "pay
less paydays" for others.
The state has unpaid bills piled
up of about 72 million dollars. It
has just collected aid spent 14
million dollars from its citizenr
from a tax new declared illegal
aid faces the near impossible
task of trying to rebate all the
pennies collected on purchases of
, cl thing, groceries and other
Its Legislature is going into the
11th straight month of wrangling
while, as o-e newspaper said last
week, proposals for new taxes
waft around the chamber like ex
It seems and it is ridicu
lous that bankruptcy threatens
Michigan. This is one of the
wealthiest and fastest growing
states in the nation. It has the
huge automotive industry, magnif
icent forests and mineral deposits,
a big agricultural industry.
Why, then is Michigan broke?
The answer boils down to a no
quarter struggle between the Re
publican controlled Legislature
with the support of industry and
Democratic Gov. G. Mennen Wil
liams, a millionaire with the
backing of the United Automobile
Williams has been governor for
six consecutive two-year terms
and the Republicans have ruled
the Legislature those 12 years. In
all that time, they have never
reached a satisfactory, long-range
tax program, although state ' ex
penses mounted rapidly.
To understand Michigan's prob
lem, cert an facts must be stated.
The state is constitutionally pro
hibited from borrowing more lha:i
S2S0.000 although even its towns
can float bonds and go into debt
by 2 million dollars or more.
Thus, while other states can and
do borrow to meet current needs,
Much of its revenue is car
marked to more than 40 special
funds which cannot be used for
general state expenses. It has no
state income tax. Its main reve
nue comes from a 3 per cent
saUa tux .
But -iir-1948 legislation was
passed that out of every six cents
collected on the sales tax, 4 cents
had to gi to the schools and one
cent to local governments. That
left only 1-6 for the state.
By PHIL NEWSOM
UPI Staff Writer
From the foreign editor's note
new Soviet overtures?
West German intelligence offi
cials will not be surprised if the
Russians offer to scrap their War
saw Pact agreement as part ol
their world disarmament cam
paign. The Warsaw Pact is the
Commun'st bloc European coun
terpart of NATO. The German!
say Soviet military experts havt
told Premier Nikita Khrushchev
that the move would have excel
lent propaganda value and at th
same time would not be harmfu
to Soviet military strategy.
CAMPAIGN AGAINST SIN:
Police are conducting an all-ou'
campaign against vice in Frank
furt, known as West Germany's
most sinful city. Targets are the
railroad station where unregis
tered prostitutes loiter, all nigh
bars aid cabarets which flaunt
"lewd" advertisements of strip
President Charles dc Gaulle
himself is said to be pressing the
investigation into France's newes
political drama. It involves 1h
reported attempted assassinatiot
of Leftist Sen. Francois Mitter
rand. Mitterrand claims a ma
chine gun attack o his car wa
engineered by elements opnosinf
de Gaulle's offer of self-determi
nation for Algeria. But formei
French deputy Robert Pcsque
charges that Mitterrand engi
neered the whole thing himself tc
try to force a government clamp
down on rightwing elements op
posing the de Gaulle plan.
The men who will determine
where and how visiting royalty
shall be seated at the 1960 Olym
pic games In Rome, have a new
worry. They know about Pope
John's XXIII delight in breaking
with tradition and they are tak
ing up seriously the possibility he
might want to see some of the
games. Would a separate throne
have to be erected for Pope John?
There is no precedent to go by.
This is not the first crisis by
a''y mea"s. Past shortages have
been m"t by such expedients as
a new tux on liquor aid one on
cigarettes Now, more patchwork
tax legislation is in pruspect by
One likely action is the seizure
of the veterans' trust fund of 40
million dollars to pay off bills.
This fund has been use! o ily t'
I he etc-'t of loa.is ot aboil'
M,500,(KX) a year tn vetenns and
the argument is that those can
he handled by a special appropri
ation. Another idea is a new $iu "one
shot" tax on every automobile
owner in Michigan. With 3. 500.000
cars that would bring in 35 mil
The Male not a ba.l jolt last
mouth. Another ol its expedients
was r;iisiiii the sales tax liom 3
per cent to 4 per cent lind calling
t he eslia o'ie per cent a use tax
The stale Supreit.e Court ilir'are I
it illegal 0:1 a strictly partisan
Dvmocrats and 3 Itepubl cans
li;i,is aid an a Hiema H in
"onie cf no million d l; r was
Pco;l Are Disgusted
Nun there is much political
sciiriyi"K to put relercndiiiNs on
the ballot in the November im
election to f t party Sii a'ety
Ttie Ili'i-ublicaa.s propose to ask
a c.nstitutional clia '.go to 'loos
the sales tax to 4 per cent.
The t'AW over the week end
countered that it would ask ap
proval of n terrific excess profit '
lax which would take 25 per cent
of corix,r:iii. ,,Li..r A iMr
'cent With Ce'icral Motors record
canines fir the first 9 months of
ih s year, the annual tax on that
cumpa-.y ;,H, wouy pl,t Michi
gan in the black.
Williams -ays that is all very
'veil, hut he needs till million dol
''U s mm
The pi.bhc hasn't had the
cha-ee to say much of anything,
but a visit here makes it evident
the people are disgusted. Several
editors at a United I'ress Inter
national r e. ting in Grand Rapids
agreed a let of ieople would line
to loss out the entire Legislature,
Ucmociats and HeHitilicuns alike,
plus the governor and start with
a clean slate.
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