World Panorama . Dorothy Thompioi, Statesman colnmnjst, brings to this newspaper's readers keen Insight fnto world events and their signifi cance. . Weather Fair today and Friday, little change in temperature or humidity; Max. Temp. Wednesday 88, 31 in. 46, rir , er -3.2 feet, ' northwest Wind. FOUNDED 1651 EIGHTY-SEVENTH YEAR Salem, Oregon, Thursday Morning:, August 19, 1937 Price 3c; Newsstands 5c No. 124 ltiinree adk Ouitan rami w- ...... . .Foe Housing Issue Is Cleared by Lower Branch Measure Differs Widely . From Senate's, Must Reach Agreement House Clears Decks hut Tax Loophole Bill Is in Upper Tribunal WASHINGTON, Aug. U.-(P)- The house shoved the low-cost housing hill through passage to night with a 274 to 86 roll call vote. Approval of the measure to set up a $526,000,000 program of federal aid to state and municipal low-cost housing projects cleared away a major barrier to adjourn- f nient of congress by Saturday. The senate, however, must ap prove house amendments before the legislation goes to the White House. Critics Ehot one amendment after another at the legislation. Almost without exception the house refused by lopsided votes to accept them. - ; Conference Fight , I Xow Forecast ' ' But because house provisions departed drastically, from those that won senate approval a fort night ago. a further struggle lies ahead in a conference in which senators and representatives will attempt to reach a compromise. Tonight's house action left it np to the senate to wipe clean the session's legislative slate by pass ing a final appropriation bill and legislation to close tax law loop boles. ; For more than nine tumultous hours house members battled over the housing measure. In the midst of the give and take wrangling, a7 to 59 stand ing vote killed a proposal by Rep resentative Hancotk (D-NC) to impose a limit of $4,000 per dwelling unit or $1,000 per room on all housing projects. Blast Be Held to Average Housing Similar restrictions were Incor porated by the senate. The house, however, accepted the decision of its banking committee that cost should be held down to the ave rage for similar private construc tion and in no event exceed $5,000 per unit. Still resisting any major effort to change the legislation, the house junked an amendment by Representative Fish (R-NY) that would have lifted from 10 to 15 per cent the amount of federal funds that might be turned over to any one state. It refused to alter the bousing bill's provisions for local contri butions toward the cost'of dwell ings for families of small means. The senate, meantime, began consideration of the house - ap proved bill to close loopholes in the tax laws. It delayed a vote un til tomorrow after Senator Schwellenbach (D-Wash) protest ed against the measure's being rushed throurh "without even a pretense of adequate considera tion." . - - : Valley Priest Is Jailed bv Nazis J' : J . PORTLAND, Ore., Aug. 18-A?)-A little American flag carried in his pocket and a United States passport failed to keep Rev. Jo seph B. Saal, Catholic priest, out of jail when he visited his native Germany for the first time In 2$ Tears, he told interviewer! today. The Rev. Saal, parish priest of the Little Flower shrine at Wil onville, said he spent a short time time in Jail for making uncompli mentary remarks about Dr. Josef Goebbels. "minister for national enlightenment and propaganda. He a a 1 d he was acensed of holding public meetings because he stopped and spoke to persons n the street and gave a farewell party for his brothers and sisters. "The people are living in a ter rible fear,- he said. "They have Ho freedom. If they go to Am erica all the property they possess Is confiscated. They get only enough for a steamship ticket and .v in money. The resentment against timer is growing." ,WA Lists Funds For new Schools PORTLAND, An g. 1 g-(ffyWasb Jngton advised C. a Hockley Oregon PWA director, of the fol lowing allotments for school build togs: ; Near Sherwood, grant, f 3,7 72 estimated cost of structure $8, $82: Beaverton 231.500. timt ed cost $70,000; Gilbert Station S32.727. estimated tout t90 ana- Arcadia, $9,360, estimated, cost 919,000. Roper Is Reluctant to Invoke In Sino-Japanese - JJ$j Effect of Favoring one Nation Is Feared fghtr I, With Prospect Both! Would Transfer Relations, Be Difficult to RejrV WASHINGTON, August" 18 (AP) Secretary Roper served notice today the United States does not want "to sac rifice any proper trade relationships" with Japan and China through application of embargo provisions of the neutrality law. ' ' Speaking slowly and earnestly in answer to reporters' O Insurgents Take Arenas, Is Claim Left Flank Is Crushed in Surprise Sortie by Leftists, Stated . HENDAYE, Franco-S p a n I s h Frontier, Aug. 18.-(iF)-The Insur gent radio at Bilba announced to night that Gen. 'Francisco Fran co's troops have occupied the town of Arenas, 28 miles from Santander. Arenas is 11 miles north of Reinosa, important northern Spanish town taken earlier in the week by the Insurgents in their campaign against government held Santander. The radio communique said 1,- 700 government militiamen sur rendered. In taking the town of Arenas. the Insurgents captured their first glassworks. The factory was in good condition and furnaces will be lighted Friday to start produc tion of glass badly needed in a dozen towns and cities where bombs and shells have left scarce ly a window intact. A government OrQ m m n n ique claimed that suprise sortie " of crack Asturian and Santander troops from the mountains west of Reinosa had crumpled the left flank of the Insurgents there. The government troops ,were said to have swept the insurgents from their trenches along the Pa- lencia highway in a Complete rout. Insurgent artillery and aircraft tried to defend the positions, the government said, but the attack ers took command of several hills. The government victory was within 40 miles of Santander, Its last Biscayan seaport and strong hold, toward which insurgent Gen eralissimo Francisco has been driving steadily. Hiring of Oregon Jobless Is Urged The practice of certain Oregon employers in hiring recent arriv als from other states Instead of persons dropped from the WPA rolls, was deplored by Floyd- Bil- yeu, state field agent for the worka progress administration, while in Salem Wednesday. "I have been advised that many Oregon employers are giving pref erence to persons from, other states," Bilyen said, "with the re sult that former WPA workers have been unable to obtain em ployment. If this continues the re lief rolls in Oregon will increase correspondingly." Bilyen said many persons drop ped from the relief rolls are effi cient and were badly in need or employment. "I would suggest that persons desiring to employ help confer with the works progress adminis tration before taking on residents of the other states," Bilyen con- tinned. FR Foes Distrust Democra cy He Asserts: Quotes Macaulay JlANTEO, Roanoke Island, w . n inr 1 8-ffn-Presldent Roo sevelt acensed his foes today of "mouthing" praise of tne consti tution while aecretly distrusting democracy. The president's denunciation of what he called hie "tory" oppo sition was his first since the United States senate buried his proposal to reorganize the su preme court. It was delivered before a per spiring crowd of several thousand aV ceremonies celebrating the 250th anniversary of the birth of Virginia Dare, firs: child of Eng lish parents born on this contin ent. - ' ' ' '' ' . -. Mr. Roosevelt turned to Lord Macaulay, an English historian who predicted In 1857 that demo cracy would not succeed in this country, for the major theme of his address. . After reading from Macaulay s prediction, he declared : "Almost, methinks. I am read ing not from Macaulay but from Neutrality Law questions, the cabinet member as serted invocation of the law might have the effect of "favoring one nation." Saying that "we do not want to do this," -Roper added there was a question as to "how effec tive application of the neutrality would be in carrying out the pur poses of our people to maintain peace." He predicted Japan and China would transfer their purchases to other nations should exports from the United States be banned. After China and Japan had found new markets, Roper' con tinued, they would be reluctant to resume dealings here. , He asserted sales of cotton, gasoline and oils accounted for the bulk of the United States $165,519,000 exports to Japan during the first half of this year. He added it would be "a real question" to decide whether such exports should be classified as sinews of war and embargoed. Huge Flying Boat Will Join Search Explorer Wilkins to Head Party; Alaska Fliers Delayed by Rains FAIRBANKS, Alaska, Aug. 18 -P)-Chilling rain and low-hang ing clouds tonight deepened the six-day-old silence surrounding the disappearance of pilot Sigls mund Levaneffjsky and five Rus sian companions on a projected transpolar flight. Impossible flying conditions throughout the polar region held a squadron of planes to the ground here. Likewise a Russian hydroplane awaited clearing wea ther at Welland, northern Siberia. Levaneffsky and his country men dropped from sight Friday after' messaging a Russian radio station the ship was encountering rough weather soon after cross ing the pole. r- The pnjp possible clue to the position of the ship was furnished by Eskimos on Barter Island, south and east of Barrow, on the 144th Meridian. They told Pilot Bob Randall, one of the searchers, they heard (Turn to Page 2, Col. 4) Midair Kidnaping Charged to Youth P HOUSTON. Texas 'An rast 18- (AV-A youth giving the name of Jack Hamerly, 19, was held to night on a kidnaping charge after the mid-air abduction of an air- itlana vtilnw The youth was quoted by De tectives Arch Spradley and Ira Williams as admitting he drew a pistol on Pilot Bob Hunt 2000 feet in the air and ordered him to fly to Laredo. The forced flight ended when Hunt snatched his captor's pistol as the latter bartered wlth'a fann er near Rosenbnrg for gasoline to continue the hop. a resolution of the United States chamber of commerce, the Liberty League, the National Association of Manufacturers or the editorials written at the behest of some well-known newspaper proprie tors." American Lord Macaulays" of today, tne president declared, dis trust maioritr rule became "an enlightened majority will not tol erate the abuses which a privll eged minority would seek to foist nron the neonle as a whole" Reaffirming his faith in demo cratic institutions, the chief exe cutive asserted: "T seek no chanre in the form of American government. Major ity rule must be preserved as the safeguard of both liberty and civ ilization." On the sneakers rostrum were some who fought his court reor ganization bill, Including Senator Clark (D-Mo). Governor Hoey introduced the president as the "colossal figure (Turn to Page 2, CoL ,7) Portugal and Czechs Break Off Relations Failure to Permit Arms Purchase, Attitude on Spain Reasons Given ? Minister Leaves ; Recent Disturbances Viewed as Possible Cause' LISBON, Portugal, Aug. V9-(JPj-The Portuguese government has broken diplomatic relations with Czechoslovakia because the iPraha government refused to let Port ugal buy arms and because of the Czeehnslnvakian attitude toward Spanish- non-intervention, an of ficial communique said today. The government statement dis closed that the Portuguese min ister to Czechoslovakia left Praha for Vienna yesterday with the le gation staff, leaving the task of looking after Portuguese interests in the middle European repuDiic to the Italian minister. LONDON, Au5. 18 -JP) The Portuguese government, said & dispatch from Lisbon today, has severed diplomatic relations wun Czechoslovakia. The dispatch did not mention cause or details of the reasons for severance. The cable from the Associated Press correspondent in LJBbon said only "Portuguese govern ment severed diplomatic relations Czechoslovakia," and it had been delayed some hours by the Port uguese censor. Pending receipt of more def inite news from Lisbon, foreign observers speculated whether the rupture might have been the out come of two recent events a ser ies of bomb explosions in Lisbon last January and the recent at tempt 4n . Premier Ollveria JSal azar's life- ee therFovernment claimed foreigners were Implicat ed in both events. The Exchange Telegraph Agency (British) declared under Lisbon date that tne Portuguese government broke all relations with Praha because of the Czech oslovaklan government's alleged failure to fulfill contracts to sup ply arms to Portugal. Costa Carnelro, Portuguese minister to Praha, will be recall ed at once, Exchange Telegraph said. Official quarters in Berlin Pro fessed to have no information of such a step by the two govern ments, and there was general puzzled surprise there. Comment from Praha was not at Snce available. Moody Preparing Bank Night Brief The state's brief in the suit brought by Carl Porter, manager of the Elslnore theater, to restrain local officers from interfering with the operation of "bank night," was being prepared Wed nesday by Assistant Attorney General Ralph Moody. He said the brief would be filed later in the week. Arguments in the ease were heard by Circuit Judge Lewelling several months ago and the attor neys were ordered to file briefs before a final decision was banded down. Moody contends that "bank night" is a lottery and in violation of the Oregon gambling statutes, Attorneys for Porter allegea that "bank night" was a patented entertainment feature and was op erated in connection with the moving Dicture industry. The operation of "bans nigm was discontinued here at the time the original suit was filed. Peters Will Hear Recall Argument Chief Justice Bean of the Ore gon supreme court yesterday as signed Circuit JudSe Peters of Hillsboro to hear the mandamus proceeding to compel County Clerk Boyer to call a special election for the recall of County Judge John Slegmund. The writ of mandamus was made returnable In the circuit court here Friday morning. Boyer refused to eaU the elec tion on the grounds that the good names on the petitions were not sufficient. A large number ? of names were rejected for the rea son that they could not be rouna on the voters' registration lists. Sponsors of the mandamus pro ceeding alleged that the signers, although not registered, were elig ible because they possessed the other qualifications of a voter. The mandamus was filed by J. S. Baker and others. SCENES OF WARFARE IN NORTHERN CHINA I t t jm. '"A w-wv' war 1 yf 4 ri Two of the first actual war scenes a Chinese field piece la fired in a binoculars. Below, train derailed ese soldiers guarding the wreckage while equipment to repair the photos. Young Roosevelt Denies Escapade Must Have Been Someone Else, He Asserts but French Are Certain PARIS, August lS-WV-John Roosevelt, youngest son of Presi dent Roosevelt, denied today that he had squirted champagne in the face of the mayor of Cannes or slapped him with a bouquet of flowers at a Cannes "battle of flowers" on Sunday. He said the Dlavful celebrant must have been someone else. However, George Goln, chair man of the fete committee who made the original identification of young Roosevelt as the one who encountered the mayor, said in Cannes: "It was young Roosevelt who attacked the mayor and there is no mistake. "I was sure' of it before and I verified it afterwards." Mayor Pierre Nouveau himself. who had a telephone conversa tion today With American Am bassador William C. Bullitt, as serted: "I was told that my attacker was young Roosevelt although I had never seen him before. 1 re gret to say that I am certain now it waS Mr. Roosevelt. I wish the whole affair was ended." Large Sums Paid, Relief in County A total of 221,881.35 was dis tributed so far in the month of August to 1062 people throughout the county by the local reliet agency, it was announced yester day at the county relief office. Under' the assistance to blind division 2778 was issued to 34 people for an average of $22. S3. Dependent children in the coun ty numbered 85, receiving a total of 21185 or an average of 113.94 apiece. The largest fund of the three included is that alio ted In the old age division in which 943 people received $19918.35 or an average of 221.12 per person. : The office is preparing for new CCC enrollment scheduled for the early part of next month. SPeciti catlons for this sort of work have changed slightly during recent monthfc. It now includes young men who need jobs besides those actually on relief. If the applicant has no dependents his - earnings will be saved and paidr in a lump sum at the time of his discharge. Anyone interested is invited - to get information at the office. Late Sports LOS ANGELES, Aug. 18-iT)-The Seattle Indians defeated Los Angeles tonight. 11 to 8, halting the Angels' winning streak at six games. -" Seattle ..............11 17 0 Los Angeles ......... 8 12 2 Gregory, Pickrel and Splndel: Thomas. Lieber, CamPbelL Over man and Collins. A, . : ... ( " 'y-V-V to arrive from China since hostilities with Japan broke out. Above, Tientsin street, with officer in the rear watching; target through and rails torn up by Chinese as they retreated southward, Japan Blaze Is Battled In Green Timber SHELTON, Wash., August 18-(iP)-Simpson Logging company fire fighters were busily engaged tonight trying to get control of a blaze in their Grays Harbor county property 30 miles west of here. George Drake, logging superin tendent, reported the fire, be lieved to have been Ignited from a spark when pitch lines snarled during operations this afternoon, was rapidly eating its way into green timber. Two of the company's donkey engines and much felled timber, Drake said, had already been con sumed by the flames. Nazi Camps Under C-Men's Scrutiny WASHINGTON, Aug. li(jpy-G-men began to scrutinize cer tain German-American camps to day to discover whether any are being operated in violation of federal law. "It is really more of a check np than a formal investigation," Attorney-General Cummlngs told reporters, "But I have asked the federal bureau of investigation to . make a cursory examination to ascertain - if there : are any facts warranting further investi gation." The government's attention was brought to the camps when representative Citron (D-Conn) asked the state department to ascertain whether "nasi military training camps" are being spon sored In this country by German consulates. Babe Risko Takes Count MILWAUKEE, Aug. 18 - (TP) - Babe Risko of Pittsburgh, former middleweight champion, was knocked out In the fifth round of a scheduled 10-round bout here last night by George Black of Mil waukee. Lebanon Strike Settled 1 but Oukridge Mill has Dispute EUGENE, August lS-itfVC. A. Paddock, AFL lumber union or ganizer, who was arrested at Leb anon for "riotous conduct,"-was released today - upon settlement of the strike at the Wynn-Sewell lumber mill. ' , Following .a conference this afternoon involving union, com pany and municipal representa tives, the strikers agreed to re turn to work., They had walked ont last week when officials of the company dismissed the union leader. Since that time the crew, composed of about 35 men, had remained about the plant. SetUement of the Lebanon strike., however, was overshad owed today when CIO organizers charged "dictatorial" methods by lumber and sawmill worker of ficials last night at Oakrldge. The local there voted to disre gard the question of CIO affilia tion. . . : Percy M. Madden, Marshfleld, :- r c i damage is on the way ua 12,000 Want to - Fight for China Heara Is Tired Soldier of Fortune $ Is Deluged With Mail Offers , LOS ANGELES, August 18-P) A tired soldier of fortune, Gen. Russell Hearn, laid a handful of letters on a table, called atten tion to their varied postmarks and said: "One day's mall. Guys from everywhere want to Join me." Since Hearn let it be known a few weeks ago that he is assem bling not recruiting, positively not other soldiers of fortune to fight for China, he said he had been deluged with mall. "I haven't been able to sleep," he complained. "Answering let ters all the time. "About 12,000 people have written me already, I guess," Hearn said today. "Not only pi lots, but cavalrymen and infan trymen and engineers and even some women who want to be nurses. They all want to know when we leave and how we get there. "I can't tell them anything definite. There's a law which makes it illegal to recruit men In T- (Turn to Page 2, Col. 1) Mexican Of ficers Coming Saturday PORTLAND, Aug. 18 -(TP)-Warden James Lewis will take SO members of the Mexico police de partment on a tour of the Ore gon penitentiary at Salem Friday. Lieut Manuel Cardoza, repre senting General Martinez, Mexico's chief of police, will call upon Governor Charles Martin. The officers are members of a group of 99 here for the "Mex ican Fiesta" Saturday. member of the . international woodworkers' , executive board, declared that AFL officials pres ent at the meeting had blocked consideration of - the issue, and announced that the question would be brought np again at the next meeting. : , J. J. Babe, attorney for the national labor relations board, opened an investigation of com plaints against the industrial em ployes', union, former Four-L or ganization. . TOLEDO, August 18-ff)-RaIl lumber shipments moved forward today under guard by Southern Pacific company detecUves as three . national .. labor relations board representatives arrived . to Investigate charges against the Industrial employes union. - The charges were, brought by the AFL officers who ordered pickets thrown around the C. D. Johnson Lumber corporation Fri- . Turn to Page 2, Col. 6) Japanese Land Positions Are; Under Barrage 100,000 Regulars, Many Others Due to Oppose 25,000 Nipponese Events May Shift Heavy Artillery Battling From Shanghai RTTAVfiHAT. Aug. 10-(Thi day) - (jP) Japanese warplanes rained bombs on the American Southern Baptist Mission com pound today as a heavily rein forced Japanese army took the offensive to cut off Shanghai from Woosung and the Yangtse river. It was not definitely known whether the 20 Americans liv ing in the compound had been evacuated. The Japanese bombs were apparently intended for . the electric power house in the Chapel area on the northwest ern border of the international settlement. U. S. Consul Gen. Clarence E. . Gauss decisively told Jap anese naval authorities traffic between Shanghai and Woe sung the gateway to the sea -and safety for thousand ef Americans must be absolutely unrestricted. As the Japanese started their offensive Vice Adm. Kij-vebl Hasegawav commander-in-chief of the Japanese fleet operaUng against Shanghai, notified tne American authorities the Jap anese navy wished to restrict traffic on the Whangpoo river over which almost lOOO Afr icans have been evacuated. SHANGHAI, Aug. -(jrVa11-ese artillery batteries began shell ing Japanese land positions and warship in the WhangPoo river at dawn todav with a heavy barrage fire believed to be preparatory to. a major offensive. . - The international settlement and the French concession were rniVoil hv the tremendous force of the explosions, north of Soo chow creek and to the east along the Whangpoo waterfront. The impending battle was expected to be the severest cast Asia nas seen since the close of the Russo-Jap anese war quarter, of a century ago. The Chinese bombardment con tinued off and on throughout last night and as the brilliant Shang hai moonlight faded before the dawn burst into full fury. Settlement Faces Shortage of Food The International settlement, French concession and Chinese (Turn to Page 2, Col. 1) Live Steam Blast Kills 7 Workmen PHILADELPHIA, August 18-(jp)-A blast of live steam la the fire room of the IT. S. destroyer Cassln killed seven workmen to day and scalded nine others, in cluding seven sailors. The dead were Joseph Va&sa- . lusso, Michael Scavo, Louis Sher- . by, William Mehl and W. T. Me Callum, of Philadelphia; George . Dreisbach, Oaklyn, N, J., and Daniel Vantier, Camden, N. J. The Cassln had been in dry dock for several days for repairs. Steam pressure on the vessel had V been raised to test the valves. - One of the main pipes in the ' fire room burst, tilling the room with live steam. . . , . , . Graves May Name Wife for Senator ATLANTA, Aug. H-Mra. Bob Graves, the likely appointee for the United States senate seat of Hugo I Black, sped to Wash ington by airplane late today with her husband, the governor of Alabama. . Both Mrs. Graves and the gover nor who is empowered te ap point a successor to the supreme court justice-designate were in high spirits, ' but noncommittal. - The governor's wife, Dixie to her friends, laughed aside . au thoritative reports she will suc ceed. Black. Graves likewise re fused to affirm the reports. B A L LAD E of TO DA V By R. C. It seems the well-meaning neutrality law, designed to keep this nation free from all harm, would operate much like a sock on the jaw to a nation invaded, desiring ' to arm; so though China's beset by the hosts of Japan, officialdom stalls oa in voking that plan.