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About Capital journal. (Salem, Or.) 1919-1980 | View Entire Issue (July 12, 1938)
v., A Ik & apitamJoiir iial Weather Fair tonight and Wednesday but fogs on coast. Little change In tern perature. Gentle changeable wind. Monday: Max. 78, min. 48. Rain 0. River -3.7 ft. Northwest wind. Part ly cloudy. First in News Photos With tha Associated Press ex clusive Tele-Mat service, the Capl Ul Journal U enabled to preunt photo of world event! within few bouri of their occurrence. 50th Year, No. 164 Salem, Oregon, Tuesday, July 12, 1938 Price Three Cents On Trains and Nw 8trda rtf OnU mm iter at StvUm, Oraton Hughes at Omsk, IHa obe Flight aw aa aa nr... UU VYV Capitol Case Encampment Parade to Move At 7:30 Tonight Politics and Pageantry Feature VFW Conven tion; Medals Presented Politics and pageantry are interesting delegates and vis itors as the 18th annual en- campment of the Veterans of Foreign Wars today swings into its closing hours. Elec tion and installation of offi cers and selection of the 1939 encampment city closes the session tomorrow afternoon. Supporters of 0. J. John son, Pendleton: E. W. Hor ton, Marshfield, and Phil Rin gle of Salem are busy lining up delegates for their favorites who seek the office of junior vice com' mander, election to which assures the department commandershlp In 1941. Ashland and Grants Pass are both after the encampment next year. While the convention was in ses sion at the Elks temple, a school for service officers was held at the chamber of commerce rooms this morning. In the afternoon a school for adjutant-quartermasters was held and a presentation of a case before the rating board, conducted by John Walker Jones, national rehabilitation officer, assisted by V Dr. Paul L Carter and members of the staff of the veterans' bureau, Honor Medals Given High street was closed to traffic between 11 o'clock and 5 o'clock for stunts by the Military Order of the Cooties, which held Its annual stunt parade last night viewed by several thousand people. Presentation of honor medals by Governor Charles H. Martin was the occasion of a special, ceremony at the courthouse steps shortly te fore 1 o'clock this afternoon. Sil ver stars and purple heart awards were given Comrades Richardson, Weaver, Golden, Rlngle, Scott, Cross. Hansen, Shinn, Baker, Mc Kay and Wallace. . Monte Brooks, Portland, master of ceremonies, is offering a half. hour radio broadcast between 3:30 and 4 o'clock this afternoon, featur lng an Indian singer and selections by visiting bands. The annual encampment parade moves promptly at 7:30 o'clock to- J night, passing through the business district and in review in front of the grandstand, where prize win ners will be announced and special drills and competitions presented, Grand Parade There will be six divisions in the parade, the first composed of dis tinguished visitors and heads of pa triotic organizations', second, strict ly military. Including the 7th U. S. Infantry and band from Vancou ver Barracks, Wash., and national guard units; third, all marching organizations of the VFW and auxi liary; fourth, other patriotic or ganizations; fifth, fraternal and civic groups- and sixth, commercial and Industrial displays and floats. A special low admission charge Is being made for Sweetland field where the parade will disband and contestants take their places. fCom-ladrd en page 12, eolnmn 1) Fehl Loses Appeal In Insanity Trial Earl H. Fehl, former county judge iw Jackson county, lost his fight in supreme court today to be released from the Oregon state hospital. The high court ruled that Fehl, who was released from the penitentiary last year after serving a four-year sentence for ballot theft, was com mitted legally by Circuit Judge H. D. Norton. Fehl contended that the Jury should have sat at his insanity hearing, but the court ruled a jury was unnecessary. "Whenever the defendant has, In the Judgment of the superinten dent of the state hospital, recover ed from his unfortunate mental con dition, he will, no doubt, be dis charged," the court said. Fehl was committed last De cember 20 on a complaint filed by Fred W. Kelly of Medford on No vember 6. Other opinions today were: H. B. Scuti vs. i. A. Troeh and Democrats . Of Indiana Name Van Nuys Opponent of Roosevelt's Pet Bills Renominated By Convention Indianapolis, July 12 (IP) A "love feasting" Indiana democratic convention today renominated by acclamation Senator Frederick Van Nuys, opponent of President Roose velt g court and government reorganization bills, who at one time had threatened to seek re-election as an inde pendent. Naming of Van Nuys, es tranged until last week from the party's state organization headed by Governor M. Clifford Townsend, was only a formality. Others Withdraw The way for Van Nuys' renomina- tion was cleared a week ago last night when Governor Townsend In vited him to become a candidate before the convention. The senator accepted. Then all obstacles In Van Nuys' path were removed by the withdrawal of other candidates. Last year Governor Townsend had declared Indiana democrats would not support for re-election "those public servants who have not been loyal to the president." i Paul C. McNutt, whose White House ambitions were a factor in bringing about the truce between the "regular" organization and Van Nuys, received the convention's en dorsement for the 1940 presidential nomination. The convention platform said: "With him (McNutt) as the nom inee for president of the United States our party can proceed with full consciousness that every prom ise will be kept, that each platform declaration will be respected, and that the best Interests of the people will be conserved and advanced." The platform said McNutt "Is at the full strength of mature man hood, is unusually gifted with a sense of statesmanship, is qualified with proven administrative experi ence In state, national and Inter ttonal affairs, and Is possessed of unimpeachable character." No Evidence Against Nazis London, July 13 P) Malcolm J. Mac Donald, secretary for colonies, told the house of commons today that he had "no evidence" that nazi or fascist dictators were stirring up trouble In Palestine, An opposition questioner. John McQovern, Independent labor, cited reports that "a large number of re volvers and wire cutting Implements have been found In Palestine with German markings." He then asked how much of the current violence "Is traceable to the activities of Mussolini and Hitler." Mac Donald said he had "no In formation" about a discovery of German-made arms. He said the first squadron of the 11th, Hussars armored car regiment from Egypt would arrive in Palestine tomorrow. others, appellants. Appeal from Jackson county. 8ult to reform written Instrument. Opinion by Justice Belt. Judge H. D. Norton, reversed. J. W. Maldment, appellant, vs. Ed Russell and Kate Russell. Ap peal from Gilliam county. Suit to set aside transfer of real and per sonal property. Opinion by Justice Lusk. Judge Fred W. Wilson, af firmed. Joseph Marshall and Lawrence C. Marshall, appellants, vs. Charles R. Frazier. Appeal from Multno mah county. Bull Involving account ing. Petition for rehearing denied in opinion by Justice Bailey. Reargument granted In State ex rel Van Winkle vs. Farmers' Union Cooperative Creamery. Goes to Jury I Senator Frederick Van Nays Governor Too Busy to Call On President Governor Charles H. Mar tin will be unable to accept invitations to meet President Roosevelt In California dur ing the president's western trip. Two invitations reach ed him today. The gover nor's office Issued the follow ing statement: "The governor has. receiv ed two Invitations, one by telephone from Washington, D. C, and one by telegram from Amarlllo, Texas, to visit the president In California. However, he Is Indeed sorry that pressure of official busi ness precludes him from leaving Oregon at this time to accept the kind Invitation." Martin Moves Into Capitol Governor Charles H. Martin moved his headquarters into the new state capltol building today from his old quarters In the state office building, where he had been since the old statehouse burned In 1935. The governor's suite in the capltol is the most palatial in the building. His own private olfice, a compara tively small room, is paneled In burls of Oregon myrtle, both on the walls and ceiling. A private lava tory adjoins his private office. Between the governor's own office and the one he will use for confer ences and meetings, is a walnut pan eled hearing room. The conference, or public hearing room. Is also pan eled In walnut, with a mock fireplace and a map of the state at one end. In the suite is also the large board of control room, which will also house the meetings of the state land board. There Is a large lobby In the gov ernor's suite, with committee rooms adjoining, as well as ample quarters for his staff of secretaries. W. L. Gosslln, the governor's private sec retary, will have a paneled office handy to the governor's. The budget department, under Di rector Wallace 8. Wharton, also moved Into new quarters in the cap ltol today. The budget division, like the secretary of state, treasurer and land board offices, will be on the main floor. The press room, accom modating United Press. Associated Press, Oregon Journal and Oregon Ian and local correspondents Is also on the ground floor. Correspondents moved In last night. Assert Italy to Break Agreement London, July 12 IIP) Spanish government accusations that Pre mier Mussolini had no Intention of carrying out his side of the bargain to withdraw foreign fighters from Spain gave new pause today to men who already have worked 23 months on an evacuation scheme. The British foreign office had a note from the Barcelona govern ment asserting Italy sent 6,860 sol diers and 334 aviators into Insurg ent Spain since the signing of a British - Italian friendship agree ment April 16. Further, the note charged, Italy would take home 10.000 soldiers, most of them 111, from Spain If the non-intervention committee's plan went Into effect. Defense Rests After Testimony Of Realtors Value of $62,000 Sought for Patton Property; Frizzed Case Tomorrow With the defense in the Patton condemnation proceed ings resting at 11 o clock this morning, predictions were that the trial would reach the jury by 3:30 o'clock this af ternoon. It was agreed time would be taken between 11 o'clock and 1:15 this after noon to consider instructions with arguments starting as court opened at 1:15 o clock. Each side agreed to not more than an hour for the arguments. The defense case was made up principally of realtors and others who offered comparative values with properties based on sales and rentals to show that the Patton property is within line as to the valuation of $62,000 placed on it by the owners. The state Is offering $32,000. Rostein Testifies Ed Rostein, six years a realtor here after 25 years of merchandis ing in Salem, placed a valuation of $59,024.40 on the Patton property. Rather than capitalizing a hypothet ical apartment property he used a comparative value for basing his estimate, the sale of the R. B. Flem ing property at Court and Winter to F. N. Derby. While the sale was reputed at $25,000 he placed a valua tion of $20,000 on the Fleming pro perty as a conservative estimate, which would bring the land value to $1.55 a square foot. To this he added one-third for the Patton pro perty as being, he declared, the most favorable apartment house site in Salem. The house he placed at $6000 depreciated value. In addi tion to the Patton home being the best apartment house site, was add ed the Idea of size to help make up the extra one-third, the larger site being deemed of more value for the purpose. Royal Court apart ment difficulties were hinted at In cross-examination. In answer to that Rostein said that during the (Concluded on page 10, column 7) Insurgents Push Forward Hendaye, France (at the Spanish Frontier), July 12 (IP) Spanish in surgents said today they had fought their way against desperate govern ment resistance to high positions in the Espadan mountains from which they could see the ancient crossroads town of Sagunto, key to Valencia. Sagunto, at the Junction of the Castellon-Valencla and the Teruel Mediterranean highways, Is 14 miles north of Valencia. It Is the next ma jor objective of the eastern Insurg ent drive. Earlier government dispatches said hand-to-hand fighting in the Es padan mountains had slowed down General Garcia Valino's Navarrese troops, reported within sight of Se gorbe, 15 miles northwest of Sa gunto on the Teruel-Medlterranean highway. Further to the east the Insurgents threw their forces into successive at tacks on government lines from VII lavleja to the coastal highway south of Nules, but government reports said the attacks were repulsed with heavy losses to the Insurgents. Va lencia dispatches said Generalissimo Francisco's forces along the coastal highway had lost 1000 men in the past three days. Party Leaders to Meet Mr. Farley Portland, Ore., July 12 (UP) James A. Farley, postmaster-general and democratic national chairman, will be greeted by democratic state candidates and party leaders when he arrives In Portland Friday morn ing. Farley will be guest of honor at a breakfast, will broadcast during the morning, and Is to confer with state party leaders before leaving for Seattle at 1 p m. He Is to attend the national con vention of Young Democrat In Seattle, Board Brands Raskob-du Pont Tax Evaders Dodged About $1,600, 000 Income Taxes by Paper Sales Transactions Washington, July 12 (VP) The United States board of tax appeals found today that Pierre S. du Pont and John J. R a 8 k o b had attempted to evade more than $1,000,000 of income taxes by "paper transactions" in securities. The exact amount of addi tional taxes due on their 1929 incomes was left by the board to be determined later, but attorneys estimated Raskob might be held to owe about 11,000, 000 and du Pont above $600,000. After the 1929 stock market crash. du Pont and Raskob sold about $4,500,000 of securities to each other at prices far below what they had paid for them. Eventually they re sold the securities to each other so each wound up with his original holdings, they claimed deductions from their Income tax for the losses Indicated by the difference between the original value of the securities and the prices at which the securi ties were sold. To Escape Taxes The board said, "When summed up, our whole question Is one as to whether the transactions consider ed are such as the statutes as to deductions! losses Intended and contemplated, or were paper trans actions to escape tax liability. "The matter before us here re quired examination In the light of the ordinary actions and reactions of men, guided by criteria of rea sonable human behaviour in busi ness transactions. "So viewed, they demonstrate, in our opinion, the complete im probability the asseverations of petitioner that the sales were bona fide, real, free from agreement to reacquire, In spite of the result the complete return to original ownership. Such a result would conceivably be without design, but such a thing would be entirely too remarkable for belief. Too Transparent "Men do not conduct themselves and accomplish the end as did these parties toward each other, and attain an end so advantageous to their for tunes, without a common under standing. This design was too com plete to be without designer. "The record before us bears Its transparency, and though the res pondent (government) had, contrary to the usual situation, the burden of proof because of having raised this issue after proceeding with file In our opinion that burden was abundantly met, "To reach a different conclusion would require us to be blind to fact and to place a premium on Ingenuity, rather than bona fides." The decision was written by Richard L. Disney. Ten members of the board approved Disney's opinion, three concurred In the de cision without approving the opin ion, and three dissented. CIO Refuses to Load Lumber Ship Portland, July 12 WV-CIO long shoremen supported fellow union sawmill workers today and refused to load 300.000 feet of lumber of the West Oregon mill on the steam schooner George L. Olson, before which the sawmill union had put a picket. The CIO sawmill group picketed the mill's lumber because of a con tract recently signed In which the AFL was designated as bargaining agent for the mill's employes. The amount of lumber picketed constituted only a smsll shipment and did not seriously affect the mill. Whether the longshoremen will refuse to handle other ships with West Oregon lumber remained to be seen, the AFL claiming the longshoremen were obligated to load the vessels because of a con tract with the Waterfront Employ ers association. Tierney Wants Chairmanship Portland, July 12 IIP) Frank Tier ney, former executive secretary of the democratic state central com mittee, said yesterday he was a can didate for the state chairmanship. Others seeking the position In clude John J. Beckman, Portland; Walter Oleason. Portland, and Ro bert Bradford, La Grande W " If ft iv) luifl 1 OA .yjiM Hughes Arrives In Paris This picture transmitted by radio from London to New York, shows tall Howard Hughes striding from his plane in which he flew non-stop from New York to Paris in 16 M hours, halving the time set by Col. Charles E. Lindbergh. At right is American Ambassador William C. Bullitt, who greeted Hughes and his crew of four on their arrivals. Associated Press Photo. No FDR Picked in Colorado Aboard President Roosevelt's Train Enroute to San Francisco, July 12 (JP) President Roosevelt asserted today that "we want democracy to work." "That is our chief ob jective," the president told a crowd estimated by police at more than 15,000, in a brief rear platform address from his special train at Pueblo. Colo. "We New Library 18 11 A Q uurdry Per Cent Along After nearly six weeks of con struction, the new $1,000,000 Oregon state library Is approximately 18 per cent along the road to comple tion. It was announced today by Allan Toole, clerk of construction. He disclosed that construction to date was ahead of the contract, which calls for completion by the first of the year. For the past month, crews have been primarily engaged in putting on the marble exterior and Install lng book stacks. Much of this work has been done under the su pervision of library officials, In cluding Miss Harriet Long. About three-quarters of the west side remains for the marble work ers, Toole said. As soon as the marble is laid, the main emphasis will be turned to interior partitions and finishing. Body of Lost Babe Found in Stream Nelson. B. C, July 12 (IV-Staff Sergeant C. O. Barber of the British Columbia police said today an autop sy of the body of 18-months old Carmen LaJeunesse had revealed that the child whose body was found In a creek near Ymir. B. C, was neither drowned nor assaulted. Meanwhile, a coroner's Jury view. ed the tiny body and prepared to ad journ until next week while police sought more Information as to the cause of death of the baby who dls- appeared from near her home last May. Earlier, he had asserted that po lice were attempting to determine whether the child was killed "de liberately" before being thrown Into the creek or where she met death accidentally and then wi thrown Into the stream. 6-Year-0ld Boy Hit by Ball Bat Allan C. Jones, 6, was seriously Injured when struck by a ball bat at Leslie playground today, and is at Salem Deaconess hospital. Mem bers of the first aid crew of the Salem fire department, who treated the boy, said he had a neck frac ture. Ournee Flesher. superintendent of the playground, said the lad and a companion were playing when the former stepped In front of the bat He is a son of Mr. and Mrs. Reece Jones, rural route No. 4, Favorites I don't want to copy other forms of government," he said. "Ours is good enough for us." The president avoided reference to Colorado'a democratic senatorial primary, making no mention either of Senator Alva B. Adams or his primary rival. Judge Benjamin C. HUllard. Conservation Talk Mr. .Roosevelt devoted much of his Pueblo talk to describing the gov ernment's efforts toward conserva tion of natural resources, and de scribed the government as "a com mon meeting ground" for the states m adjustments of their differences, particularly those Involving water. His only mention of a Colorado official came when he said, discus sing interstate water problems: "Your governor and I have talked about them." The president said average per sons In the east think the Ar kansas river is a creek and are sur prised when he tells them the peo ple of Pueblo were nearly wiped out in 1021. "That river is not the problem of Just one state." Arkansas River The president said he always talks about the Arkansas as a good exam ple of a watershed and such water shed's various needs. Gov. Teller Ammons of Colorado, who la unopposed for renomlnation, stood on the train platform behind the president with Senators Adams and Ed C. Johnson and Represen tative John A. Martin of Pueblo, all Colorado democrats. Foree Admits Talks With Banks in Mill Dallas, Or., July 12 (IP) Lisle Foree, another defendant on trial for arson in connection with the West Salem Box fac tory fire, admitted on the witness stand today conversations with Al N. Banks concerning moves to be made against the factory to get a union sign-up, but said he did not know that Banks had In mind the burning of the plant. Foree, called by the defense, Is un derstood to be the last witness In the case, and was under cross-examination when the court adjourned at noon. Relative to his conversation with Banks the day before the lire Foree said Banks spoke of getting men from Portland to see John Frlcsen, owner of the mill, but he under stood they were only going to nego tiate. This, he said, he thought was Banks' Intention, even when Banks said "he will sign or else.1 and again when he said "he will sign or I will make It hot for bun.' Fliers Prepare To Resume Flight to Coast 6696 Miles of Projected 14,709-Mile Globe Girdling Trip Covered Moscow, July 12 (P) How ard Hughes landed his big sil very monoplane at 9 p. m. to night (1 p. m., EST), at Omsk, Siberia, approximately halfway point of his round- the world flight. At Omsk Hughes had cov ered 6,696 miles of his pro jected 14,709-mile globe gird ling course and had complet ed three of the intended six legs of his journey. The American flier and his four companions covered the 1,380-mlla distance from Moscow In seven hours 35 minutes. When he left Moscow Hughes in dicated that Yakutsk, Siberia, 2,177 miles northeast of Omsk, would be his next halting place. As soon as he landed refuelling of his plana began. Ahead of Post Forty-two hours 40 minutes out of New York, Hughes waa well ahead of the round-the-world record of the late Wiley Post. (Post did not stop at Omsk, but he took slightly over 69 hours to reach Novosibirsk, 600 miles far ther east.) Hughes and his four companion! took off In their sleek silver mono plane from Moscow's central airport at 1:29 p. m. (6:25 a. m. EST), two hours and 12 minutes after they arrived from Paris. They had 6,000 miles of Soviet territory shead of them as their heavily loaded plane sped away on the 1,380-mile hop to Omsk. They completed the Paris-Mos-(Conrluded on pure P, column 6) Russians Aid Hughes Flight Washington, July 12 UP) Rus sian cooperation In the flight of Howard Hughes ranged from revis ing a special radio weather code to ordering his Moscow breakfast by cable. The Soviet embassy here dis closed the arrangement for the first time today. Sine a language difficulty arose, the Soviets and Hughes perfected a special weather radio code. For example, Hughea on receiving the symbol IS BS 20 IS NE, would have the following information. "Celling 150 meters. State of weather: broken clouds and show ers. Visibility 20 kilometers. Wind velocity 18 kilometers per hour. And wind direction northeast." The Soviet embassy said that, contrary to the Impression Hughea Is flying over Siberian wastes, he actually Is flying along regular air line routes partly equipped even for night flying. Pleasure was expressed in the op portunity to reciprocate for the fa vors shown the Russian Arctlo fliers by the United States govern ment. Hughes' route should take htm from Moscow to Omsk and then to Yakutsk nonstop, or possibly with an Interim stop at Krasnoy arsk. He will fly non-stop over the north Pacific and Bering sea from Yakutsk to Fairbanks, Alaska. - Foree admitted that when he heard about the fire he began to wonder about what Banks' Inten tions really were. He said that ha met Banks three or four days after the fire and said to him: "That waa a pretty good Job you did In West Salem." He said Banks replied: "Yes, the rats are all out of a Job now." Concerning his signed confession when he was arrested he said that Captain Warren of the state police dictated the statement, and that he singed It after glancing It over. District Attorney Bruce Spaulding read him the confession sentence by sentence under cross-examination today, and most of It he admitted as all right. (Concluded oa pase column 4) f