CaipitalJoiuirinial
THE WEATHER HERE
CONTINUED FAIR tonight and
Friday. Warm day-time temper
atures. Lowest temperature ex
pected tonight, 46 degrees; high
est, Friday, 80.
Milmn yerttrdfty, 75; minlmam U
ftr, 44. Ttal Z4-hnr prMlpitatlon, ; for
tenth, t. Sckhb'i yrtclpltatlon, 41.81;
MMoa Kraal, S1.U. River helfht -3.1
fell.
HOME
EDITION
61st Year, No. 160 matter at Salem, Oregon
Salem, Oregon, Thursday, July 7, 1949
(24 Pages) Price 5c
Big Gas Refunds
No Atomic Bombs
r&stAN BULLISH' ON
''''' mmmmmmmmmmmmm ijiui
-. 1 - 'J
q fir AH ,JL iVpi '
Believed Due
To False Claims
Over $3 Million, 12
Left by Army
US ECONOMIC OUTLOOK
Percent of Collections,
Repaid by State
By JAMES D. OLSON
Fraudulent claims for gasoline
tax refunds are believed to be
responsible for the mounting re
funds applied for by owners of
motor vehicles not operated on
public highways, according to
William E. Healy, assistant sec
retary of state.
In 1048 the gasoline tax re
funds totaled $3,009,303.88 on a
total tax paid amounting to
$23,414,772.30 or 12.85 percent
of the total collections.
Field auditors of the state de
partment have unearthed many
false claims, according to Healy
and in 1948 $36,777.81 was sav
ed through denial of such
claims.
Invoices Altered .
"Our auditing staff is small,"
said Healy, "with the result that
many claims cannot be investi
gated." Healy stated that as an exam
ple the auditors found one far
mer who had made claim for
gasoline tax refund on gasoline
used In two passenger cars as
well as in farm machinery. As
the result of this revelation the
entire claim of this individual
was denied.
The alteration of dates on
gasoline1 invoices has become a
common practice on the part of
many claimants. Under the law
the claims for refunds must be
made within a year from the
date the gasoline was purchased
and in many cases the date of
sale is altered.
Advocates Repeal of Law
Healy states that whenever
such alterations are suspected a
check is made with the gasoline
company and the correct date is
obtained.
, Healy is of the opinion that
counties of the state would re
ceive more money for road work
if ' the gasoline tax refund law
was repealed, declaring that in
1948 the counties received $5
278,871.23 as its 19 percent of
gasoline tax, motor registration
fees and public utility commis
sion truck fees.
"The farmers and loggers,
representing the largest percent
age of recipients of the funds,"
said Healy, "would also profit
by repeal of the refund law be
cause it would mean that many
miles of county roads could be
repaired or constructed with use
of the money that is now paid
out as refunds."
Healy also called attention to
the fact that the gasoline tax is
not levied for use of the high
ways, the state supreme court
having held that the Oregon gas
tax is a license fee on companies
selling gasoline within the state.
The gas tax refunds during
the last four years were: 1945
$2,009,909.35; 1946 $2,150,
456.12; 1947 $2,706,651.82:
1948 $3,009,303.88 and during
the flrst four months of 1949
$1,337,014.29.
3 Day Week
Negotiations
LB
Philadelphia, July 7 (IP) The
United Mine Workers board of
strategy and the nation's anthra
cite operators open contract ne
gotltions today with the contro
versial three-day work week a
possible issue.
Negotiations between John L,
Lewis' UMW and three branches
of the soft coal industry are al
ready underway.
Lewis, whose union includes
400,000 bituminous diggers and
eu.uoo hard coal miners, put a
three-day work week in effect
for all soft coal miners east of
the Mississippi starting this
week.
His order, which drew imme
diate criticism from both con
gressional and industry leaders,
did not include the hard coal
miners, however.
' In the anthraoite fields a five
day work week is in effect this
week after the Pennsylvania an
thracite committee set the week
ly production quota at 1,207,000
tons. .
While the bituminous industry
is divided into three negotiating
groups steel-owned captive
mines, southern operators and
coal men of the north and west
the anthracite industry speaks
as a unit
One of the prime reasons for
Lewis' shortened work week or
der was believed to be the rec
ord soft coal stockpile now above
ground.
153 Death Toll
Of Heat Wave
(By the Associated Pt&m
It was more hot and humid
weather for most. of the eastern
two-thirds of the nation again
today. No widespread relief
was in sight from the week-long
heat wave.
Showers and cool air brought
a measure of relief to some of
the hot spots but the U.S. wea
ther bureau didn't expect a
general break in the steaming
heat immediately. Meanwhile,
crop losses in the drought-stricken
northeastern states mounted
daily and no heavy rains were
forecast.
Deaths attributed to the hot
weather mounted to at least 153.
Cool air fanned out over the
dry-stricken areas of New' Eng
land, and New York state yes
terday and rain fell in some
parts of the eastern states.
New York City got its heavi
est wetting in weeks a half
inch rainfall. That was more
than fell in the metropolis dur
ing the entire month of June.
The mercury was a pleasant 81
yesterday and dropped to 71
early today. Scattered showers
brought relief to other parts of
New York state.
New Jersey, where crops have
suffered millions of dollars
damage from 45 days of drought,
also got some rain, but not
enough to help the wilting crops.
Stock Sale Authorized
San Francisco, July 7 (IP)
The California-Oregon Power
company has permission to sell
250,000 shares of common stock
of a par value of $20 a share. .
Problem of Humanity
Now One of Leadership
By ROBERT LETTS JONES
The problem of humanity today is a problem of leadership.
That is the way Dr. Bonus iBenes analyzes the chaos in the
world. And Dr. Benes, visiting professor at Willamette university,
has a background in central Europe to give him a perspective
rare these days. He is a nephew of the late Dr. Eduard Benes,
who died last year after being
forced to resign as president of
Czechoslovakia following com
munist seizure of his country.
"Who to look to for leader
ship?" is the question bothering
the nations of the globe now,
Dr. Bohus Benes told a Salem
audience Wednesday night at
Waller hall on the university
campus.
In making the first of three
local talks, Dr.- Benes classified
his listeners as "children." He
used this term, he explained, as
he would in Europe for his chil
dren1: "The sooner they know
about trouble the better for
them."
His
message evidenced sin
His words and delivery
cerity
reflected his background of be
ing reared and schooled in Eur
ope's troubles of this century.
He keyed his talk to an ex
planation of the progress of
the Czech republic formed after
World War I, through the years
to the "betrayal" at Munich in
1938, a 20-year span. He brought
Raid on Eagles Yields Gambling Apparatus Top: Fifteen
slot machines seized at Eagles headquarters, 371 N. High street,
in a night raid conducted by Clyde Warren, Salem chief of
police, and Denver Young, Marion county sheriff. Shown with
the machines are Archie Wilson, policeman, and Merle Wood,
deputy sheriff. Lower:- Slot machines, chuck-luck cages,
bean-o apparatus and punch boards removed to basement
storage in the courthouse. Shown are those who assisted in
organizing and accomplishing the raid. From left: Glenn
Simpson, Denver Young, Clyde Warren and William DevalL
Seize Slot Machines
In Raid on Eagles Club
A complaint charging the board of directors of a Salem fra
ternal organization with unlawful possession of gambling equip
ment was being prepared Thursday on the heels of a police raid
which resulted in seizure of 15 slot machines and numerous other
,
Jake Dira to
Hang July 15
Olympia, July 7 (IP) The state
supreme court ruled in effect to
day that axe slayer Jake isira
should hang as scheduled July
15.
The high court entered an or
der denying Bird's latest petition
-for a writ of habeas corpus.
The writ, if it had been grant
ed, would have given the 46-year-old
Negro another hearing
in the state supreme court.
The petition for the writ was
the latest in a long series of legal
maneuvers by Bird to escape the
gallows for slaying of Mrs. Ber
tha Kludt in Tacoma two years
ago.
Bird is being held in the death
row of Walla Walla state prison
awaiting his scheduled hanging
shortly after midnight July 15.
the decadence of the French
and British democracies" prior
to the outbreak of World War II.
He had served in diplomatic
posts for his nation on the con
tinent during that period. While
with the allies in the last war,
he observed how the British and
French people "suffered for their
mistakes."
His remarks pointed to the
"immoral leadership" of the de
mocracies in 1938, the year of
Munich. "It was clear that
Chamberlain offered Hitler a
free hand in Europe that year."
Benes described Neville Cham
berlain, British premier, as "an
ignorant man (ignorant of for
eign affairs) leading Europe to
disaster." Benes related how he
heard in 1936 the then prime
minister of Great Britain, Stan
ley Baldwin, tell how he
couldn't ask his country to re
arm in face of the threat of Hit
ler "because then he wouldn't
get re-elected."
(Concluded en Faze 5, Column )
gaming contraptions. ,!
I District Attorney E. O. Stad-
ter, Jr., who initiated the action
which brought the raid, said that
on the basis of evidence secured
by Salem police and the Marion
county sheriffs office a com
plaint would be filed against the
directors of the Willamette
Aerie of the Fraternal Order of
Eagles.
Six members of the Salem po
lice department headed by Chief
Clyde A. Warren and four mem
bers of the Marion county law
enforcement office led by Sher
iff Denver Young raided the
club rooms of the organization
at 371 N. High street under a
search warrant obtained by
Stadter in Silverton justice
court.
The cache of gambling equip
ment was found in a padlocked
room. When members of the
organization who were present
at the time of the raid failed to
produce a key to the door, the
lock was pried off by Chief
Warren.
Inside was found six five-cent
slot machines and an equal num
ber of dime slots along with
three quarter machines. In ad
dition, the law officers carted
away eight punch boards, two
chuck-a-luck devices, a bingo
cage, a master bingo board and
208 cards to be used with them,
a box of numbered cork balls,
four boxes of poker chips and
a set of dice.
"I filed an affidavit to obtain
the search warrant," Stadter ex
plained Thursday, "when I re
ceived information from two
separate, independent sources.
I deemed the information reli
able, anO that was confirmed by
the results of the search."
(Concluded on Page 5, Column 6)
Paris Strike Cufs-off
Electricity in Homes
Paris, July 7 (IP) Electricity
was abruptly cut off in 66 per
cent of Paris homes and build
ings today by a wagestrike.
Suburbs also were affected.
Gas pressure was sharply re
duced, and the state-owned pow
er company asked users to ra
tion themselves. Power plants
in the north, at Lille and Mau
beuge, also were idle.
Workers belonging to the
communist-led C.G.T. labor fed
eration suddenly left their jobs
during the night. For six months
workers have been negotiating
with the power companies for
a complicated series of wage in
creases. .
For Commission
All Used Up in Experi
ments Complete
Model Change
Washington, July 7 (IP) Sena
tor McMahon (D., Conn.) said
today the United States had no
atomic bombs in 1947 when the
army .turned .atomic projects
over to a civilian commission.
He declared the commission
didn't find any bombs the
models had been used up."
McMahon tossed this out at
congressional hearings after an
army general said there has
been a complete model change
in the bomb since the AEC took
over the project.
How many bombs this coun
try now has and the production
rate of bombs are closely guard
ed secrets.
Brig. Gen. James McCormack,
Jr., director of the AEC's mili
tary application division, also
said that all production bottle
necks "worthy of serious con
cern" now have been broken
and weapons production is on
a "stable basis."
McCormack testified at the
senate-house atomic energy com
mittee's hearings on charges by
Senator Hickenlooper (R-Iowa)
that there has been "incredible
mismanagement" of atomic
projects under the AEC and its
chairman, David E. Lilienthal.
Lilienthal Testifies
In a general denial, Lilienthal
and the AEC contend that, on
the contrary, the project was
bogged down" when they took
it over and has been infused
with new life.
McCormack told the congres
sional committee that weapons
production, formerly concen
trated at Los Alamos, N. M., on
a "custom" manufacture basis
is being carried on in plants
"dispersed widely" throughout
the country. The plants, he said,
cost in excess of $100,000,000
and are staffed by "thousands of
people."
Open Own Defense
The commission " fired the
opening volley in its own de
fense yesterday with Robert F
Bacher, former commission
member, as the principal wit
ness. The 43-year-old physicist, who
was associated with the atomic
program for eight years before
(Continued on Face 5, Column 7)
Housing Bill
On Final Lap
Washington, July 7 (IP) The
administration's vast housing bill
today hit the final lap of its long
trip through congress.
Democratic leaders confident
ly expected to hand the trimmed-
down measure to President Tru
man before the day is over, fol
lowing its approval in comprom
ise form late yesterday by a
house-senate conference commit
tee. The bill, marking the first ma
jor success for Mr. Truman's
"fair deal" program, was passed
in differing versions by the sen
ate and house. It calls for a mul
ti-billion dollar program of pub
lic housing, slum clearance and
farm housing aids.
All that was needed before Mr.
Truman could sign the compro
mise into law was its approval
by the two chambers of congress.
Administration leaders, who
had barely snatched the bill's
public housing feature from de
feat in the house were jubilant
over the prospect of seeing it fi
nally enacted.
Start Retrial
Of Mindszenty
Budapest, Hungary, July 7
yt) Hungary's highest appeals
court commenced the retrial last
night of Josef Cardinal Minds
zenty and his co-defendants.
Authorities apparently were
not too keen on publicizing the
trial. The press was not inform
ed of it and Hungarian papers
made no mention of it.
Under Hungarian law the de
fendants themselves do not at
tend a retrial. Only the tran
script of previous testimony is
studied by the court which lis
tens to the prosecutor and de
fense counsel.
The prosecution has contend
ed that the sentences passed by
the original court were too light.
The defense has asked that they
be made lighter.
Survey Completed for
Bridge Creek Road
flnnntv Survcver Dale Graham Thursday submitted to the coun-
tv court his completed survey
leaves the Silver Falls highway
and the falls and the court directed the survey De suDmiuea to
abstractors to determine ownerships along the road and particu
Blood Donors
Fail to Sign Up
Up to Thursday morning, only
45 persons had signed to be don
ors when the mobile unit from
the Portland regional blood cen
ter comes to Salem next Tues
day, July 12.
Unless more sign up, the city
will fall far short of its quota of
100 pints. Because so many each
time fail to keep their appoint
ments and because there is al
ways a certain percentage of
cancellations and rejections, at
least 150 persons should be sign
ed up if the 100-pint goal is to
be met.
The unit will be in operation
at the First Methodist church
here between the hours of 3 and
7 p.m. Tuesday, the last donors
to be accepted at 6:30 p.m.
Members of the blood pro-
g r a m recruitment committee
and of the local Red Cross chap
ter are at work to line up
groups to sign as donors. The
blood taken here is processed in
Portland and returned immedi
ately for use in hospitals here
for. those lh need of it.
Flanders Raps
Atlantic Pact
Washington, July 7 (U.R) Sen.
Ralph E. Flanders (R-Vt.) came
out against the North Atlantic
pact today, saying it will not
stop Russia and will help bank
rupt the United States.
For those reasons, he said, he
is withholding his support of the
12-nation treaty.
Flanders' surprise announce
ment came during a blistering
attack on U. S. foreign policy as
the senate moved toward ratifi
cation of the pact.
"The politburo has set out
to ruin us economically," he
said. "The politburo has victory
within its grasp. It is at this mo
ment ruining our country. It
determines our policy not mere
ly in the foreign field but in the
domestic field."
Flanders said the world's
battlefield" is not where back
ers of the Atlantic pact think it
is. tie said tne U.S. has fallen
into a Russian "budgetary am
bush" by overspending in for
eign and military preparedness
fields. The end result, he said,
could be only national bank
ruptcy.
He said the pact's related $1,-1
450,000,000 arms program will
be another step in a soviet plot
to bankrupt this nation.
Dewey Names Dulles
Senator from New York
New York, July 7 (IP) Gov. Thomas E. Dewey today appoint
ed John Foster Dulles, his veteran foreign affairs adviser, to the
United States senate as successor to Robert F. Wagner.
Dulles will serve an interim
will be elected at a special election November 8 to serve for the
balance of Wagner's term from Dec. 1, 1949 to Dec. 31, 1950.
Dewey said it was "unlikely"
that Dulles would run in the
Nov. 8 special election as the
republican nominee.
He said he had made the ap
pointment because of Dulles'
wide knowledge of foreign af
fairs. 'The foreign affairs issues be
fore the senate made his appoint
ment the greatest contribution
to the senate that I could make,"
the governor said.
Dewey was asked whether
Dulles, an American delegate to
the United Nations, would have
to resign his UN post because of
his senatorial duties.
"I don't know," Dewey said.
"That would be up to the ad
ministration." Dewey made the announce
ment in his suite at the Roose
velt hotel here.
of the Bridge creek road which
about half way between Silverton
larly, just what part of the roao-
way the county owns and what
part, if any, it doesn t own. The
survey covers about seven miles
of road.
Dispute as to title to certain
portions of the roadway arose
because of some uncertainties in
the deed of the right of way to
the county from the Cascade
Operating company which han
dles the properties of the old
Silver Falls Timber company,
The present right of way of
the seven-mile road follows the
right of way of the old Silver
Falls Timber company logging
railroad. When timber cutting
was abandoned the late William
H. Woodard, head of the timber
company, tendered the right of
way to the county as a gift for
road purposes and it was accept
ed. A deed was prepared and
sent to the county but in some
manner the original deed was
lost. Mr. Woodard died but in
the meantime the road had been
improved with county money
and the county held no visible
evidence of ownership
The Cascade Operating com
pany as successor to the Silver
rails company prepared some
new deeds which were not sat
isfactory but finally a deed was
prepared and accepted. It then
developed that some details in
the deed didn t exactly match
up with the survey, a land own
er on the road claimed part of
the roadway and offered to
trade what he claimed as his
land for some county land. Also
there was the matter of a con
nection between the new road
and the old Bridge Creek road
which parallels it.
The discrepancies caused the
court to last winter order a sur
vey of the entire seven miles
the road
The survey as submitted to
the court is on a single sheet, 16
feet long and on a scale of one
inch to every 200 feet. In places
the roadway is very irregular
with curves and angles. The
land as deeded included a com
plete 100-foot right of way.
"When we get the abstractor s
report," said County Judge
Grant Murphy, "we'll know
where we stand and can act ac
cordingly as to any disputed
ownership
Exempt Austria from
War Reparations
London, July 7 VP) The Big
Four deputy foreign ministers
formally exempted Austria to
day from having to pay war rep
arations to the allies.
Russia accepted for inclusion
in the Austrian independence
pact which the deputies are
drafting a British proposal say
ing:
"No reparations shall be ex
acted out of Austria arising out
of a state of war in Europe on
September 1, 1939."
term until December 1. A senator
John Foster Dulles
Gives Up Hope
Of Tax Increase
By Congress
Washington, July 7 (IP) Pres
ident Truman described the do
mestic economic situation today
as bullish. He promised a full
statement on conditions in his
mid-year economic report to con
gress the first of next week.
The president also indicated
at a news conference that he
may now be resigned to the idea
that congress will not pass his
proposed $4,000,000,000 tax in
crease this session.
Informed that Rep. John Mc
Cormack of Massachusetts, th
democratic house leader, had ex
pressed the opinion last night
that congress will not pass such
a bill this year, Mr. Truman said
John ought to know for the sim
ple reason that tax legislation
originates in the house.
Fights for Labor Bill
The president said he favor
efforts in the house now to pass
a labor bill substituting for the
Taft measure approved by the
senate. But he said the decision
has been left up to house demo
cratic leaders. Labor leaders
have advocated leaving the Taft
Hartley act alone for the rest of
this year so that it can figure in
the 1950 elections.
On economics, the president
was asked if he is bullish or
bearish in the present situation.
He replied he is bullish, or opti
mistic, and mentioned the stock
market's movements in the last
few days to bear him out.
(Continued on Page 5, Column 8)
Airfield Crisis
To Be Discussed
Salem's future'air line status
is to be discussed in Portland
Friday morning at a meeting of
Salem representatives and Har
old Crary, vice president in
charge of United Air Lines traf
fic, with offices in Chicago.
Crary, en route to Seattle to
attend the dedication ceremonies
for the new Tacoma-Scattle ter
minal, is to arrive in Portland
Thursday night and will meet
with the Salem group at 10 a.m.
Friday.
Purpose of the meeting is to
determine United Air Lines' po
sition on the CAB's recent pro
posal to substitute West Coast
Airlines service for that of UAL
in Salem. West Coast Airlines
is a feeder line, which does not
carry air freight. On the other
hand, United Air Lines is a trunk
line and a carrier of air freight.
Those going from Salem to
meet with the United Air Lines
official are Jack Bartlett of the
state board of aeronautics, Clay
Cochran of the Salem Cham
ber of Commerce, City Manager
J. L. Franzen and Robert Letts
Jones.
Jones is to represent Gov.
Douglas McKay, who in 1940
was the representative from Sa
lem appearing before the CAB
in Washington to ask for United
service to Salem. Franzen, the
city's representative, will out
line the improvements made at
McNary field the past two years
as the city prepares for expand
ed service here.
Czechs Tighten
Censorship
Prague, Czechoslovakia, July
7 (IP) Reports from strife-torn
Slovakia say Red censorship has
been clamped so tightly over
that strongly Catholic area that
communists themselves com
plain their mail is being read
and their telephones tapped.
Newsmen who visited Bratls-
lavia, Slovakian capital, for the
week-end religious holidays,
said the atmosphere is more
tense snice last week's church-
state troubles. At that time the
controlled press reported riot
ing between Red police and
Catholics trying to defend their
priests from arrest.
The situation is now believed
to be quiet, on the surface, but
authorities are increasingly,
watchful.
The newsmen said Catholic
churhes were packed for the
week-end services and church
collections, which the commun
ists tried to stop in some sec
tions, were still being taken up"