(C auraii tall a
THE WEATHER HERE
FAIR TONIGHT and Tuesday,
except for morning cloudiness.
Continued warm temperatures.
Lowest expected tonight, 48 de
grees; highest Tuesday, 82.
Mixlmum yesterday, M: minimum ti
47, SO. Total 24-hour precipitation, 0; far
month, II; normal, ,8 of an inch. Season
Ireclpltatlan, 4.1.611 normal, 87.18, River
eliht, -.B feet.
HOME
EDITION
cvlS"
61st Year, No. 163
Snterd u Mooud eluf
muter t Salem. Orecou
Salem, Oregon, July 11, 1949
(16 Pages)
Price 5c
JI ;
Baldock Plan
Before Council
In 3 Sections
Ordinances Replace
Resolution to Permit
Referendum
BY STEPHEN A. STONE
Three ordinance bills to be in
troduced and given first reading
will again put the Baldock plan
before the city council Monday
night. It will be divided into
three parts at the suggestion of
the state highway department to
conform to a logical division of
the project.
All three ol tne Dins proviur
,that the referendum may be in-
-oked at any special or general
election.
Technically it wasn't necessa
ry that the plan go to the coun
cil in ordinance form. The reso
lution already approved would
have been sufficient as far as
legislation is concerned. But the
referendum can't be invoked on
a resolution, and Mayor Robert
L. Elfstrom explained that the
nnnpil Willi Committed tO
the ordinance method so oppon
ents of the plan would not rje
barred from referendum. Some
members of the council voted
for the resolution on that con
dition. One Way Grid System
rino nf the hills la be intro
duced Monday night provides
the main one-way grid system.
It prohibits driving vehicles
south on Liberty street from
Oxford to Division, and from
Belmont to Pine. It prohibits
driving south on Capitol street
Vr,m fniirr fn Tilp rnad.
It prohibits driving north on
Fairgrounds road irom me roaa
to North Summer, or on North
Summer from Fairerounds road
to Chemeketa or on Commercial
from Pine to Belmont, or on
Commercial from Division to
Oxford.
The bill prohibits driving
west on Court from Commercial
to Capitol, or east on Chemeke
ta from Cariitol to Commercial,
or on Division from Liberty to
Commercial.
Truck Routes Defined
Truck routes are defined.
Coming north they shall enter
the city at 12th street, proceed
to Court, to Capitol, and along
f!anitnl. Fairerounds road, and
Portland road to the north city
limits. Coming south they shall
enter the city on Portland road,
proceed to Pine as extended, to
Commercial, and to the south
city limits.
(Concluded on Pane 5, Column 6)
Capitol Planners
Hold Session
The first meeting of the Ore
gon capitol planning commis
sion, created by the 1949 legisla
ture, will be held in the state
house Monday afternoon.
The seven members of the
commission will determine the
I length of their terms of office
by drawing lots, after which a
chairman and a vice-chairman
will be chosen.
Under terms of the act it will
be the duty of the commission
to adopt a plan of development
for the "capitol group" and no
plans for public buildings to be
erected within the group or a
selection of site of such building
can be made by any public offi
cial until -the commission has
investigated and made a recom
mendation to the state board of
control.
Members of the commission
are Sidney W. Little, dean of the
school of architecture, Universi
ty of Oregon; Robert W. Sawyer,
editor Bend Bulletin; Paul B.
Wallace, Salem; Herman Brook
man, Portland architect; Milton
L. Meyers, Salem, Dean G. W.
. Gleeson, dean of the school of
engineering, Oregon State col
lege and Miss Elizabeth Lord,
Salem. .
Texas Governor
Dies on Pullman
Houston, Tex., July 11 (P)
Governor Beauford Jester was
found dead today in his Pull
man berth on a train at the
Southern Pacific depot. He was
86.
First word of the governor's
death was received when some
one at the station telephoned
Homicide ' Lieutenant W. P.
Brown of the Houston police de
partment about 7:35 a.m. (CST)
The lieutenant immediately
dispatched three homicide de
tectives, Lloyd Barrett, L. L.
Watts and Frank Murray, to the
station to begin an investigation
However, Brown said that as
far as he knows the governor
died a natural death.
West Salem Bank Greets First Depositors New branch of
the United States National bank with 10 employes opens for
business this morning with Walter Musgrave, mayor of West
Salem as first depositor.
West Salem U.S. Bank
Opened for Business
New West Salem branch of the United States National bank,
housed in modernistic quarters beyond the dreams of any Fugger
or Portinari, bankers for the Christian world in the 15th century,
opened for business this morning when Walter Musgrave, mayor
of West Salem, became the first depositor,
Little Blockade
Of Berlin On
Berlin, July 11 VP) The Rus
sians have choked off truck car
goes for west Berlin to four an
hour 96 a day on the Helm
stedt autobahn. All other high
ways to the city have been com
pletely closed.
A report to the American mil
itary government that all trucks
must be completely unloaded for
inspection indicated that this
figure might be further reduced.
An average of 300 trucks a day
had been traveling the Helm
stedt road lately.
' There has been no ' explana
tion yet from the Soviet military
government for the "little block
ade." Russian border guards
said, however, they were acting
on telephoned orders from their
highest headquarters in Ger
many.
One truck leaving the Birtish
zone with 10 tons of glass for
Berlin took an hour to pass the
Russian check-point because of
the unloading and loading pro
vision. In the meantime no other
trucks were allowed to pass.
Hospital
Drive to
Start July
19
Hospital drive headquarters
announced today that workers'
guides, campaign material, don
ors' lists and the many other
pre-campaign preparations are
complete and ready for the more
than 300 workers who will take
the field Tuesday, July 19, to
start the general drive for more
hospital space for Salem.
The workers' guide contains
complete information about the
campaign, also a series of ques
tions and answers, pledge cards,
plus pictures and statistics that
will aid solicitors.
Present headquarters will be
maintained throughout the cam
paign at 335 North High street
so that workers can pick up ad
ditional supplies and informa
tion.
Ching Seeks to A vert
Nationwide Steel Strike
Washington, July 11 VP) The steel labor crisis swept into
Washington today in its rush toward a possible nation-wide
strike next Saturday.
Seeking to avert a vast steel
director oi me leaerai mediation
pared to nasn over ine aispuies
with both sides this afternoon
He invited to the conference
Philip Murray, -president of the
CIO United Steelworkers of
America, and officials of several
large companies including the
pace-setting United States Steel
corporation.
Before the negotiations be
tween the Union and U. S. Steel
fell apart last week in Pitts
burgh, the union argued that the
company, could raise wages as
much as 20 cents an hour and
still reduce prices and make a
substantial profit.
The company said higher
wages would mean higher
prices, and it refused any wage
increase at all. Disputes over
pensions and insurance benefits
were deadlocked too.
ifliill
. , I 3 V. ?
Hill ilissrssjrsi mi I ill iaaaimraaiiiaia1 . ,
West Salem branch occupies
quarters 24 by 60 feet at 1117
Edewater street and the new in
stitution is the 39th Oregon
branch of the parent institution
with headquarters in Portland.
Four windows are available for
general banking business and a
spacious vault with a sensitized
burglar alarm of the sound type
contains safe deposit boxes and
space for record storage.
Rex Gibson will serve as man
ager and assisting him will be
a staff of employes, most of
whom were formerly with the
Ladd & Bush branch and nearly
all of whom are residents of
West Salem. On the staff are
(Conoluded on Page 5, Column 2)
King Acts in
London Strike
London, July 11 VP) King
George VI proclaimed a state of
emergency today to deal with a
crippling strike on the London
docks.
, The king acted on the recom
mendation of the cabinet after
wildcat dock strikers defied
back to work call by the labor
government.
A mass meeting of 5000 dock
ers had voted earlier to continue
their stoppage.
It was the first time the Brit
ish government had invoked the
1920 emergency act since the
general strike of 1926. Under
the act the government is em
powered to draft civilians but
not strikers for work on the
docks, may confer extraordinary
powers on the police and may
commandeer buildings for the
use of troops.
Viscount Addison, labor par
ty leader in the house of lords
announced the cabinet decision
at the start of the afternoon ses
sion of parliament.
A total of 10,278 men out of
the London dock force of about
25,000 failed to show up for
work this morning. That left
112 ships idle in the tieup de
nounced by the government as
communist-led.
shutdown, Cyrus S. Ching, 6-foot-7
and conciliation service, pre
The union has never formally
demanded a specific wage fig
ure. But Arthur Goldbere. the
union's general counsel, said in
an interview that a 20-cent fig
ure was used in the negotiations
by way of illustration. U. S
Steel says the average basic
hourly wage is now '$1.69.
In that connection, Murphy
planned to fortify himself by
bringing out today in his other
capacity of president of the CIO
a new report by Economist
Robert R. Nathan to help justi
fy the demands of CIO unions
for a fourth post-war round of
wage raises. Steel workers got
a raise of 18!A cents in 1946,
15 cents in 1947 and 13 cents in
11948. .
i
Senate Group
OK's Cut in ECA
Washington, July 11 VP) The
senate appropriations committee
has approved a 10 percent cut in
funds for the European Recovery
Program, a member said today.
The senator, who asked that
identification be withheld, re
ported the group agreed to $3,-
778,380,000 to finance continued
Marshall Plan operations.
The approved cut totaled
$420,620,000 which will come
from the Economic Cooperation
Administration s proposed bud
get for recovery operations dur
ing the fiscal year which start
ed July 1.
ECA Chief Paul Hoffman had
requested $4,198,000,000 for the
second year recovery program.
The house cut this figure to $3,-
568,470,000 but permitted ECA
to spend the money in 10 and
a half months if necessary.
The senate figure represented
a compromise between those who
favored the full ECA program
and economy advocates who
wanted to cut up to $740,000
000 off the program.
The 20-member committee
was called into a closed-door ses-
on by -its chairman, Senator
McKellar (D., Tenn.). In a
lengthy public feud with Hoff
man, McKellar had talked of
cuts of as much as $800,000,000
from ERP funds rind, at times,
suggested that Hoffman resign.
State Hospitals
Get U.S. Grants
Eugene, July 11 VP) Counties
lacking a full-time tiealth offi
cer will lose federal reimburse
ment for the work after a three-
months grace period.
The state board of health made
the decision here over the week
end and said health district units
lacking a full time health officer
are Polk and Benton counties
and the districts formed by Un
ion and Baker counties.
Dr. Harold M. Erickson, state
health officer, explained that
because of the wartime shortage
of physicians, federal payments
had continued even if standards
were not met. Personnel is now
available, he said. The three
months grace period hinges on
hiring an officer or being com
mitted to finding one.
Federal grants were approved
for a new 100-bed wing to the
Sacred Heart General hospital in
Eugene, for $95,000 to assist re
building a burned portion of the
Fairview home in Salem; for a
$37,000 chronic disease hospital
at Nyssa and for $128,000 to
cover one-third of a new detach
ed hospital at the State hospital
in Salem,
Final grants for federal funds
for the 1949-50 fiscal year were
listed as $477,611. New items
listed were $12,208 for water
purification and $23,341 for
heart disease work.
Federal reimbursements on
county salary funds will be lim
ited to separate quarters of the
year. Unexpended funds applied
to other quarters will not be re
imbursed, the board said.
Egg Prices Upped
Another Cent Here
Tod grades of eggs were
boosted another cent here Mon
day morning. Eggs generally ad
vanced from 2 to 3 cents through
last week.
The new buying quotations
are as follows: Extra large AA,
59 cents; large AA, 58 cents;
large A, 56-59 cents; medium
AA, 53 cents; medium A, 51-55
cents. The advances have come
because of slackening in produc
tion during this season and the
changes here followed stronger
trends in the Portland market.
Immm Smps 7 mi Inlik
fawn Midi: Spending.
Pacific Power
Can Cut Rates
fo Meet PUD
By JAMES D. OLSON
Private power companies
serving territory invaded by
PVJDs are entitled to lower rates
to meet competition providing
loss of revenue by the lowered
rates is borne by the stockhold
ers and not the consumers.
This was the gist of an im
portant ruling made Monday by
George Flagg, public utilities
commissioner, granting the Pa
cific Power and Light company
permission to lower its rates in
The Dalles to meet the com
petitive rates of the Northern
Wasco county People's Utility
district.
"The PUD is the aggressor in
The Dalles,", Flagg stated in his
order "and has entered the field
occupied by Pacific since 1910.
It did not see fit to exercise its
right to acquire the Pacific's
property by condemnation and
thereby eliminate the uneconom
ical duplication of facilities."
Unsound Duplication
Flagg declared that duplica
tion of service and facilities by
utilities has long been consdered
unsound and uneconomical and
to result in disadvantage of the
consumer.
"In The Dalles there are now
two utilities where formerly one
existed," Flagg stated. "There
is not enough business to ade
quately support both."
Flagg questioned the power of
the public utility commissioner
to determine, which utility
would survive and by his order
virtually told both private and
public utilities to slug it out.
Must Meet Competition
"Pacific, if it fails to meet the
rates of its competitor will
eventually lose most, if not all,
the customers which it has in
The Dalles." Flagg's order con
tinued: "This loss of business
would result in loss of invest
ment which in turn would ad
versely affect the customers of
Pacific in other territories."
Flagg said that the rates pro
posed by Pacific and allowed in
his order will not allow the pri
vate company to earn a fair re
turn on its investment in that
area, but made it plain that the
losses entailed by the reduced
rates must not be passed on to
customers in other areas but
must come out of the purses of
the stockholders.
Follows Neuner's Opinion
Flagg's decision in the case
was in accordance with an opin
ion given by Attorney General
George Neuner in which it was
held that granting permission
(Continued on Page 5. Column 5)
Jhi '. J A 1 it '
i. ----- -"Ti -- i imfiifl
Californians Held Lt. James Oakey (seated, left), of the
states attorney's office, questions four Californians who were
seized in Chicago in connection with what police described
as a "transcontinental string of robberies." They are being
held without charge. Left to right (seated): Oakey, Miss Sarah
Ruth Mullins, 24, San Jose, blonde night club hostess, and
Charles Wolber, 25, La Mosa; standing (left to right): Danny
(Lucky) Kelly, 24, Los Angeles, and Robert (Red) Laird,
Tecopa. Capt. Daniel Gilbert said all four admitted robberies
of taverns, motels and motorists during car trip through Cali
fornia, Oregon, Washington, Utah, North and South Dakota,
and three Chicago hotels. (AP Wirephoto)
Asiatic Union
Called For to
Oppose Reds
Baguio, Philippines, July 11
VP) President Elpidio Quirino
and Generalissimo Chiang Kai
Shek tonight called for a union
of the countries of Asia and the
Pacific to "contain and counter
act" the threat of communism.
The joint statement of the
Philippines president and retir
ed president of nationalist China
was issued at the conclusion of
two days of talks here. It said
preliminary conference of
the authorized representatives
of those countries desiring to
participate in the formation of
the union shall be convened at
the earliest possible moment to
devise concrete measures for its
organization.
"It is our hope that other
countries in Asia and the Pacific
will eventually respond to the
highest aims of the proposed
union," it said.
Chiang's Statement
Chiang said although I have
come to the Philippines upon the
invitation of President Quirino
to confer with him n my prvate
capacity, I shall as head of the
Kuomintang (Nationalist party),
undertake to advise and request
the Chinese government to give
its full support and to take steps
to implement the agreement an
nounced in the above joint
statement.
It was not expected that India
would participate in the union,
(Concluded on Page 5, Column 3)
lifo Slamming
Door on Russia
Belgrade, Yugoslavia, July 11
(U.R) Marshal Tito today formal
ly slammed the door to the
Kremlin and, without embarrass
ment, appealed to the capitalist
west for money to help him cope
with the economic boycott of the
east.
Tito's appeal to the west for
help was broadcast to the world
by Tanjug, the official Yugoslav
news agency, after the marshal
made his 5,000-word speech to
cheering crowds at the former
Italian city of Pola yesterday.
It was the most important
speech Tito has made for a long
time. It cleared the air and el
iminated any doubt if doubt re
mained that the break between
Tito and Premier Josef Stalin is
complete.
He said he had asked the west
for a loan, but added that if turn
ed down, Yugoslavia can get
along without it.
President Outlines Program
For Increasing Production to
Well Above $300
Mid-Year Economic Report Outlines Program
To Offset Recession in Transition Period, Calls
For Price Reductions But Not Wage Cutting
By MERRIMAN SMITH
Washington, July 11 (U.R) President Truman todav tanked his.
anti-inflation program of higher
Dy tne government and a stepped-up attack on unemployment
and declining production.
Making a complete about-face in six months, he shifted his
sights from postwar inflation to threat of depression. He did not
se any indication that depression is imminent, but described this
as a "period of transition" and
He said right action can assure
In a mid-year economic report
these basic recommendations:
Abandons Income Tax
1. "No major increase in taxes should be undertaken at thii
lime." In January he had asked
increase, which congress ignored.
2. He rejected congressional
only exception was that he favored repeal of the three per cent
tax on freight. He proposed granting business the right to greater
allowances for past losses in computing corporate taxes. H
urged those changes to stimulate business. He also favored re
storing gift and estate taxes to the higher levels that prevailed
before 1948.
3. He coldly turned his back
mands to cut government spending and prevent a federal deficit
that some senators estimate may
He said this isn't the time to try
of spending would increase the danger of depression.
Cut Prices But No Cutting of Wages
4. He called on business to make further price reductions,
but not by cutting wages.
5. He renewed his demand for a minimum wage of 75 cent,
an hour, instead of the present 40 cents.
6. He asked that unemployment compensation payments b
increased. .
7. He proposed federal expenditure of $9,000,000,000 on pub
lic works over a three-year period.
8. He would permit the old age insurance payroll tax to rise
to 1 per cent each on employer and employe next January, n
now scheduled. The present rate is one per cent on each. H
did not renew his earlier pica
a health insurance program.
For Brannan Farm Supports
Other planks in his latest economic platform included "an
mproved program of farm income supports" as advocated by
Secretary of Agriculture Charles
ciprocal trade agreements law;
coverage under social security laws; and legislation to provide
technical assistance for underdeveloped areas of the world in
accordance with his "point four" plan.
In addition to a full retreat on
Truman asked for repeal of the
tation of goods. He opposed any
which would cut overall federal revenues, and renewed his re
quest for higher estate and gift levies.
To encourage business investments, he asked that provisions
for carry-over of losses by corporations be liberalized. As another
business aid, he proposed an extension in the maximum tim
limits on maturity of loans made to business by the reconstruc
tion finance corporation.
Increase Jobless Pay to
For the worker, the president
federal-state unemployment insurance system by establishing
nation-wide minimum benefit
for 26 weeks. The present limit
New York, pays as much as $26. The president proposed addi
tional federal aid for states financially unable to meet the nation-wide
standards.
While the president was openly concerned about the down
ward direction of employment
dence in the fact that the economy is still at a high level.
"The kind of government action that would be called for In
serious economic emergency would not be appropriate now," he
told congress in a 7,000-word report accompanying a lengthy mid
year analysis by the council of economic advisers.
Britain Hopes for
Dollar Issue Solution
London, July 11 VP) Britain
hopes to find a solution to her
dollar problem by September
That is the upshot of a three-
day, closed-door conference here
between United Slates Treasury
Secretary John Snyder, British
Economic Chief Sir Stafford
Cripps and Canadian Finance
Minister Douglas Abbott.
Before Snyder left for Brus
sels on the next stage of his
European tour, the three issued
a joint communique. It promised
fact-finding discussions right
away and more ministerial talks
in Washington in September.
Rural Mail Carriers Meet
Eugene, July 1 1 (IP) The Ore
gon State Rural Mail Carriers
association adjourned Saturday
afternoon after electing officers
and picking Salem as the site
for the 1950 convention. Lloyd
Fcrrcll, Grants Pass, was named
president to succeed Luther D
Cook of Salem. Warren Coombs.
Eugene, was selected vice presi
dent; Floyd Carpenter of Mon
roe, second vice president; El
don Malstrom, Adams, secretary
treasurer.
Billion Mark
taxes in favor of deficit spending
"declining national economy."
continued prosperity. -
to congress, the president mad
Increase
for a $4,000,000,000 general tax
moves to slash excise taxes. Th
on mounting congressional de
run to $5,000,000,000 this year.
to balance the budget; reduction
for new payroll taxes to financt
F. Brannan; renewal of the re
increased benefits and expanded
his higher income tax plan, Mr.
three per cent tax on transpor
other changes in the tax laws
$30 a Week
advocated broadening of the
standard ranging up to $30 a week
is set by states. Only one state,
and production, he found confi
Rainfall in
Drought Area
(By the Associated Press)
Thirsting crops in eight north
eastern drought-stricken state
had their first real beneficial
rain yesterday in 49 days.
A steady day-long shower
brought almost an inch and
half of moisture to some parts
of the area where crop damage
had mounted into the millions
of dollars.
Weathermen in New Jersey
said the drought in that state
had been washed out but farm
ers there and elsewhere through
out the northeast said more
moisture would be needed soon.
Crop damage in New Jersey
alone has been estimated at $31,
000,000. Although the rainfall meas
ured only little more than a
trace at some points it was suf
ficient generally to be a life
saver to crops that were on the
verge of doom.
In New England, where crop
damage had mounted to $10,
000,000, many points reported
nn inch or more of moisture. Old
Town, Me., had 1.46 inches.