THE WEATHER HERE
GENERALLY FAIR tonight and
Friday. Little temperature
change. Lowest tonight, 52;
highest Friday, 84.
Maximum yealcrdar, 11; minimum la
day, 02. Total t4-hour precipitation: 01
for month: .39; normal, .SO. Scaion preci
pitation, 43.35; normal, S7.M. River helrht,
-a.8 feet. (Report b; D.B. Weather Bureau.)
Capital
Journal
HOM E
EDITION
61st Year, No. 196 S82?rJSZio Salem, Oregon, Thursday, August 18, 1949
OA
Price 5c
Suspension of
Judgment on
Vaughan Asked
'- President Requests
Aide Be Given Hearing
In 5 Percent Probe
Washington, Aug. 18 yP)
President Truman today asked
the country to "suspend judg
ment" on Maj. Gen. Harry H.
Vaughan until after his army
aide testified before the senate
five percenter inquiry.
Mr. Truman, at a news confer
ence, directed his request par
ticularly to reporters and edi
tors. He was sharply critical of
what he called leaks from the
committee and what he describ
ed as a tendency to build up the
most critical testimony against
Vaughan at closed hearings.
Mr. Truman made it clear at
the outset that he did not intend
to answer any questions concern
ing the inquiry.
Truman's Statement
The president read rapidly to
day from a prepared statement
saying:
"At the outset, I want to say
to you that I do not intend to
answer any questions pertaining
to the testimony that has been
given before Senator Hoey's (D
NC) committee.
"General Vaughan has alrea
dy said that he will go before
the committee and make a full
statement on all matters with
which his name has been con
nected. "I suggest, as the chairman of
the committee has done, that
you gentlemen and your editors,
in common fairness, suspend
judgment on General Vaughan
until he has been heard by the
committee."
The president gave newsmen
permission to quote his remarks.
Blames Congress
The president blamed the pre
dicted lifting of federal rent
(jontrol in one third of the areas
still having them on congress'
failure to provide sufficient ap
propriations. (Concluded on Page 5, Column 6)
Money Voted
For Payrolls
Washington, Aug. 18 W
Swift action on Capitol Hill
pulled a number of big govern
ment agencies out of a financial
hole today.
But nearly $30,000,000,000 in
operating funds that should have
been voted six weeks ago still
were snarled up in congress.
September 15 is the new dead
line for solving the tangle
the third new deadline congress
has set since June 30.
" Quick teamwork between
Chairmen Cannon (D-Mo.) and
McKellar (D-Tenn.) of the
house and senate appropriations
committees - ended a temporary
financial emergency late yester
day for a long list of government
agencies which have been wait
ing for passage of their regular
appropriations since the n ew
fiscal year started July 1.
Cannon and McKellar sped
approval of a stop-gap measure
so about 40 government, agencies
can continue meeting payrolls
, and other expenses.
The emergency money bill
went to the White House last
night for President Truman's
signature.
Czech Consul
Stripped by Tito
Belgrade, Yugoslavia, Aug. 18
(U.R) Marshall Tito's govern
ment today stripped a Czech
consular official in Zagreb of all
diplomatic privileges after ac
cusing him of encouraging anti
Tito saboteurs in Yugoslavia.
An official announcement
charged that Stefan Horvat,
Czech deputy consul general in
Zagreb, had committed "unlaw
ful acts and. worked towards
straining relations between
Czechoslovakia and Yugo
slavia." The Yugoslav Communist
organ Borba said Horvat "es
tablished close connection with
hostile and saboteur elements in
Yugoslavia to whom he extend
ed support and incited (them)
- to commit offenses against
Yugoslavia." .
Borba also charged that Hor
vat had urged Ljerka Popovic,
Yugoslav citizen, to flee the
country and had provided her
with forged travel document'
bearing the name "Sofia Nes
ladkova."
House Slashes
European Arms
Money in Half
Stunning Set-back for
President's Program
Voted 172 to 137
Washington, Aug. 18 W) The
house voted tentatively today to
slash European arms aid from
SI, 160,990,000 to $580,495,000
and cut off the program next
June 30.
It was a stunning setback for
President Truman's program for
$1,450,000,000 in arms help for
western Europe, Greece, Turkey
Korea, Iran and the Philippines.
The action came after Secre
tary of State Acheson had warn
ed that a cut might be interpret
ed as indicative of suspicion
and distrust of our allies.
The amendment to cut the Eu
ropean part of the program was
offered by Rep. Richards (D-SC)
and adopted by a teller vote of
172 to 137. There can be a roll-
call vote on it later and the re
sult may be changed.
Aid to End June 30
Richards and those who back
ed him said the amendment
would serve notice on European
nations that arms help will end
next June 30 unless they dem
onstrate determination to pull
together as a team for mutual
defense. If they do, he said, con
gress can give the rest of the
money next year.
(Concluded on Page S, Column 8)
Coup Leader
In Syria Killed
Cairo, Egypt, Aug. 8 (U.R) Re
ports from Damascus said today
that Colm Sami El-Hinnaoui,
leader of the latest coup d'etat
in Syria, had been shot and kill
ed by an-assassin.
A civilian was said to have
shot El-Hinnaoui six times.
El-Hinnaoui led last Sunday's
army coup which ended the 138
day reign of President Hosani
Zaim, who also had seized pow
er in an army coup. Zaim and
Premier Mouhsin El-Barazi were
taken from their homes before
dawn, and executed.
(The British Exchange Tele
graph agency quoted Turkish
newspaper reports that one of
El-Hinnaoui's sons had been
killed by a son of El-Barazi to
avenge his father's death. These
reports also said Zaim's tribe
had revolted and the new gov
ernment has sent motorized for
ces against it.)
Unlike Zaim, who set himself
up as virtual dictator of Syria
after a coup, March 30, El-Hinnaoui
immediately turned over
the government to a civilian ca
binet. Hashem El-Atassi, octogenar
ian former president, was made
premier, and he was joined by
leaders of other parties in a co
alition government. The new
government lifted many of the
restrictions imposed by Zaim
and announced that elections
would be- held as soon as pos
Formal Decree Limits
City's Water Supply
By DON UPJOHN
Formal decree was filed in circuit court here Thursday by
Circuit Judge Charles Combs of
Bennett vs. City of Salem, Carl
watermaster.
The city of Salem from and
nently restrained, enjoined ands
inhibited from directly divert
ing from the running stream of
the North Santiam river more
than 22 cubic feet per second
at any time for municipal use
and from diverting any water
whatsoever for municipal use
through its 18-inch intake valve
on Stayton Island or through
any other direct diversion facili
ties whatsoever at any time when
to do so would leave insufficient
water in said stream to supply
adjudicated prior needs and re
quirements of the plaintiff."
Bennett Rights Upheld
Such prior needs of the plain
tiff Gardner Bennett as succes
sor in interest of A. D. Gardner
is 812 cubic feet per second with
a priority date of 1866 for de
velopment of power and other
manufacturing purposes. This
water right is held to be su-
oerior in time to "any and every
.ight" of the defendant city of
Salem for municipal use direct
Tito Granted
Permit to Buy
U.S. Steel Plant
Truman Says He
, Sanctioned Sale to
Yugoslavian Dictator
Washington, Aug. 18 VP)
President Truman said today it
was on his orders that the gov
ernment granted Yugoslavia per
mission to buy an American steel
mill.
He told a news conference that
the national security council
studied the matter and recom
mended letting Yugoslavia have
the mill. Then, he said, he per
sonally ordered that it be sent.
The move has provided Yugo
slavia's Marshal Tito with rein
forcements to carry on his fight
with Moscow.
After months of consideration,
the administration granted the
Yugoslav government an export
license which it needed before
placing the order for the plant.
Override Defense Officials
The American decision repre
sents the strongest and riskiest
move taken by the American
government to help the Yugoslav
dictator since he split with Mos
cow nearly 14 months ago.
It also settled a long-standing
argument between the national
defense and state departments on
whether shipment of a steel mill
to Yugoslavia would endanger
American security. Defense offi
cials had frowned on the idea
The decision to go ahead fore
shadowed possible approval of a
loan to Yugoslavia from the
World bank, where the United
States has a dominant voice.
To Help Combat Reds
Government officials who dis
closed the approval of the Yugo
slav plant request to a reporter
said it was intended to help com
bat the tightening Russian-directed
economic blockade of Yu
goslavia. Shipment of the steel mill, val
ued at $3,000,000, would mark
the first time since the war that
the United States has deliberate
ly sent "war potential" material
to a communist-run nation.
Poland and Czechoslovakia
have been clamoring for Ameri
can machinery and equipment
for the past year. The United
States has flatly refused to heed
their appeals for fear such stra
tegic materials might be used for
war purposes.
Army Loses Rank
Airforce, Navy Gain
Washington, Aug. 18 P)
The defense department report
ed today that the army lost rank
in July while the navy, air force
and marines gained.
The combined armed forces
strength on July 1 was estimated
m preliminary reports as 1,
616,600. This is an increase of
2,300 over the 1,614,300 on June
30.
Army strength on July 1 stood
at 658,500 compared with 660,-
500 on June 30.
Army personnel officials said
they expect a pickup in enlist
ments, and added there is no
present plan to reimpose the
draft.
Lakeview in the case of Gardner
Guenther and Floyd E. Siegmund,
after October 1, 1949, is "perma
ly from the running stream of
the river.
The court holds that the city
of Salem is owner of two water
rights for direct diversion out
of the North Santiam, one of
which is an undetermined in
terest with Oregon Pulp & Pa
per company and Thomas Kay
Woolen Mills of a right to use
of 254 cubic feet per second
through the Salem canal and the
channels of Mill creek for de
velopment of power and other
manufacturing purposes at di
verse sites from 19th street in
Salem to the Willamette river.
This is known as the "Salem
Power right."
Stayton Island Rights
The other right of the city is
to divert 22 cubic feet per sec
ond through an 18-inch intake
valve or pipe on the northerly
shore of Stayton island and is
limited to municipal use of Sa
lem and its inhabitants. This is
known as "the city's 1923 wa
ter right."
(Concluded on Page I, Column II
Gets the Air Dr. Maurice Nelles (left) hands Dr. Otis
Barton (right) vital piece of equipment credited largely for
the success of his record-breaking dive off Santa Cruz island,
Calif. The small container housed a battery-powered fan
which kept the air circulating over purifying chemicals. Twice
before fatigue set in as he wielded a hand fan and he became
dizzy. (Acme Telephoto) '
West Coast Airline
Officials Expected Here
Five officials of the West Coast Airlines are slated to arrive
in Salem aboard one of the company's "Scenic-Liners" to meet
with city officials, representatives of the Chamber of Commerce
and persons using air service in the Salem area.
The plane, coming here from Klamath Falls, will give a
courtesy flight to the local
Chile Ads to
Quell Rioting
Santiago, Chile, Aug. 18 WV-
Emergency powers asked by the
government to cope with bloody
rioting that has gripped bania
go for 48 hours went into effect
with congressional approval to
day. The chamber of deputies ap
proved the request 95 to 10 af
ter an all night session.
Disagreement over a half cent
boost in bus fares caused the
rioting, which has cost seven
lives. The government charges
communist agitators have fan
ned the unrest.
The new law empowers the
government to move citizens
from one part of the country to
the other; to arrest suspects in
their homes without court order,
and to suspend or restrict the
right of public assembly and the
liberty of press and radio. It is
effective for six months and
may be extended. '
Hospitals said the seven dead
included two students, a cadet,
and a street car motorman.
At least 21 other persons were
wounded, four seriously. Three
suffered gunshot wounds. The
others were hurt by bricks and
flying glass from smashed win
dows. Meanwhile the University Stu
dents federation defied govern
ment orders to return to class
tomorrow and proclaimed a stu
dents' strike.
Turkey Rocked by
Violent Quake
Istanbul, Turkey, Aug. 18 P)
A violent earthquake rocked
a large part of eastern Turkey
last night, the interior ministry
disclosed today.
The hardest hit point was Kigi
in Bingol province where four
persons, including two children
were reported killed. Twenty
houses were levelled, the min
istry report added.
The stricken area included the
provinces of Erzurum and Erz
incan where the walls of several
houses were reported cracked.
The quake lasted 34 seconds at
some points.
Brannan Sent on
Tour by Truman
Washington, Aug. 18
(Pi
President Truman said
today
that Secretary of Agriculture
Brannan's stumping tour on be
half of his farm plan is being
made at the president's request.
A reporter brought up the
matter at Mr. Truman's news
conference, asking whether the
president didn't feel that Bran-
nan should be kept on the job
here in Washington.
Mr. Truman replied sharply
that Brannan is available at all
times and that he is making the
speaking tour at his (the presi
dent's) suggestion.
group and then will be on dis
play at McNary field on the
east side near the United Air
Lines station.
The meeting with the city of
ficials and other interested per
sons is slated for 6:30 p.m. at
the Marion hotel, with a no-host
dinner to be served. This meet
ing is open to all interested per
sons and reservations can be
made by calling the Chamber
of Commerce before 5 p.m.
Purpose of the visit of WCA
officials is to show Salemites
what the company can offer in
the way of air transportation,
for passengers, express and
freight. The company, a feeder
line, has been suggested by the
civil aeronautics board as a sub
stitute for United Air Lines,
which has served Salem and
vicinity since 1941.
United, a trunk line, with six
stops in Salem daily, at a hearing
held recently expressed itself
as not wanting to withdraw
service from Salem. Spokesman
for United was W. A. Patterson,
president of UAL.
Among those in the Salem
group making the trip or attend
ing the meeting early in the eve
ning will be Mayor Robert L.
Elfstrom; Mayor Walter Mus-
grave of West Salem; W. M.
(Jack) Bartlett, chairman of the
Chamber of Commerce aviation
committee; Roy Harland, presi
dent of the Chamber of Com
merce; City Manager J. L. Fran
zen; James Walton, Wayne Had
ley, E. Burr Miller, Lawson Mc
Call, Charles Barclay, Roland
West, Howard West, Lee U. Ey
crly, James Beard, Eugene An
derson, C. G. Clerico, Clyde Ev
erett, Paul Heath, Clay Coch
ran, Mrs. B. O. Schucking, Dor-
athea Steusloff; members of the
Salem city council; Ben Max
well, Steve Stone, Robert L.
Jones and Margaret Magee of
the Capital Journal and Wen
dell Webb and Robert Gang
ware of the Oregon Statesman.
Democratic Purge
OK'd by President
Washington, Aug. 18 lP)
President Truman gave implied
backing today to a decision of
the democratic high command to
bar some states rightcrs from
next Wednesday's national com
mittee meeting..
Mr. Truman was 'asked at a
news conference whether he ap
proved plans of retiring Chair
man J. Howard McGrath to close
the door against some commit
teemen who did not support the
Truman campaign last year.
He replied the national com
mittee is in control of its own
membership.
Truman Blames Congress
Washington, Aug. 18 OF)
President Truman laid the blame
on congress today for a delay in
his own,vacation plans. The pres
ident, asked whether he planned
to take a vacation, told a news
conference questioner: You ask
congress.
rnxoniroicnaeamjaiem.
Marion County, West Salem
Farm Bureau
Group to Move
HQ to Salem
12 Families Coming
Here from Pendleton
And Milton
The Oregon Farm Bureau
Federation, which is affiliated
with .the .national federation,
will on September 1 move its
headquarters to Salem from
Pendleton and Milton.
The offices will be on the sec
ond floor at 147 North Liberty
street, in the Bishop store build
ing where the Chamber of Com
merce is located.
Removal of the bureau head
quarters here will bring 12 new
families to Salem, some of whom
have already bought homes
here. Others have rented.
Purchase Property
Among those who have purch
ased property, both just beyond
the south city limits, are W.
Lowell Steen, president of the
Oregon bureau, and Marshall
Swearingen, executive vice
president.
The state offices have been
located in eastern Oregon for
15 years. Removal to Salem is
because of membership growth
in the Willamette valley.
Much of the clerical help, said
President Steen, will be locally
employed. Among the person
nel coming here will be Miss
Alma Schroeder, treasurer and
secretary to the president and
the executive vice president.
(Concluded on Page 5, Column 1)
Foochow Falls
To Chinese Reds
Canton, Aug. 18 W China
protested today that British war
ships, displaying a bellicose at
titude toward nationalist naval
units, had violated Chinese ter
ritorial waters.
The protest was handed to the
British embassy by the Chinese
foreign office as these develop
ments came swiftly in the Asian
mainland war;
1. Foochow, big port opposite
Formosa, fell to the Reds.
2. The nationalists admitted
withdrawing from the Miao is
lands, 210 miles cast of Tient
sin. The islands had been used
by nationalist naval units to
blockade northern communist
held ports.
3. Communist armies mounted
a big offensive in Hunan prov
ince. 4. Americans and other for
eigners fled from Canton. The
U.S. consulate general expects
to be closed by tomorrow.
The Chinese note of protest to
Great Britain was given to John
Coghill, embassy representative
in Canton.
The note warned Britain
against repetition. It said the
British destroyer Concord was
sighted off the mouth of the
Yangtze river in territorial wat
ers on July 31.
(The Concord that night kept
rendezvous with the British
sloop Amethyst, which had been
held on the Yangtze between
Shanghai and Nanking for
Finnish Red Unions
Start General Strike
Helsinki, Finland, Aug. 18 (U.R) Communist-dominated labor
unions started a general strike
today and one Finnish cabinet
to seize power by force.
The minister, Unto Varjonen,
charge of the government's
anti-strike program, warned
the communists however that
the government was "fully pre
pared to deal with any attempts
to stage a coup."
The strike paralyzed all har
bors but those two handling sup
plies for Russia and shut down
69 building projects in Helsinki
alone.
A government spokesman said
52 ships were idle in 15 Finnish
harbors because of a strike by
stevedores, paralyzing virtually
all foreign trade.
The spokesman said the strike
was "most dangerous" to Finnish
economy. He said the govern
ment has "definite plans" to
break it in event the workers
m aaw m
Army Rule in
Germany Ends
November 75
Berlin, Aug. 18 (P) The U. S.
military government will go out
of existence in Germany No
vember 15, -John J. McCloy an
nounced today.
Occupation questions there
after will be decided by the
state department, McCloy, as
high commissioner.
Military rule over the Ameri
can zone of Germany came into
being in July, 1945, under Gen
eral of the Army Dwight Eisen
hower. He was succeeded by General
Joseph T. McNarney and then
by General Lucius D. Clay.
Planes Collide
Over Campers
Sag Harbor, N.Y., Aug. 18 P)
Two fighter planes collided over
the Long Island north shore to
day, showering a church camp
with jagged wreckage. A group
of 87 campers, 40 of them chil
dren, miraculously escaped in
jury. Two men parachuted to safe
ty from the planes. The bodies
of two others were recovered
shortly after the accident.
The twin-engine F87 Mustang
planes collided at 8000 feet, the
air force said. Wreckage hurtled
down on the Maycroft Holiday
camp of the Girls Friendly so
ciety, Long Island diocese ol the
Protestant Episcopal church, lo
cated one mile from here.
Miss Becky Nace, 22, describ
ed the scene this way:
"I was on the dock with six
children. There were low clouds
and we heard the roar of the
planes before we saw them.
Then, through a break in the
clouds I saw two planes clip
wings. Suddenly they were a
mass of metal starting to fall.
'I gathered the six campers
together and got them under a
table on the dock. I saw three
parachutes open. Later we found
one man dead in the water.
'There was another councilor
with six children in the water
and they rushed under the dock.
Parts of the planes began hit
ting the water and flying all ov
er the camp area."
Lumber Demand
Exceeds Production
Portland, Aug. 18 ffl Orders
for Douglas fir lumber declined
last month, the West Coast Lum
bermen's association reported to
day. But demand nevertheless out
stripped production, which was
slowed by the usual summer va
cations and shutdowns for re
pair work.
Lumber orders averaged 149,-
926,000 board feet weekly dur
ing July, compared to 155,151,
000 in June.
Douglas fir mills turned out
an average of 125,090,000 board
feet a week during July, and
shipped an average 129,845,000
each week.
So far this year, both demand
and supply of Douglas fir lum
ber is nearly a half million
board feet below the correspon
ding period of 1948.
of 100,000 workers In Finland
minister said it was an attempt
minister without portfolio in
refuse to go back to their jobs.
It was expected the govern
ment would issue an ultimatum
to the strikers later today or
tomorrow. Troops may be call
ed in to unload ships as was
recently the case in Britain and
Australia.
Some 7,000 transport workers
threatened to walk out tomor
row and virtually all major in
dustrics were scheduled to be
hit by strikers next week. The
strikers are demanding wage in
creases ranging up to 30 per
cent.
There have been rumors that
there would be a shakeup in
the Finnish communist party be
cause it has been losing ground
steadily in the past four years.
I 1 aW M
Woods Order of
Decontrol Also
Affects Eugene
Rent controls were ended
Thursday In Salem and the en
tire control area, which includes
much of Marion county and
West Salem in Polk county. The
order is effective immediately.
This information was received
here in press dispatches from
Washington, and was expected
by official message at the Salem
rent control office from Tighe E.
Woods, federal housing expedit
er. Also covered in the order of
the expediter are Eugene, Ore.,
and Lawton, Okla.
Established Oct. 1946
Rent control was established
in this area October 1, 1946. It
was largely the result of a cru
sade by the Capital Journal
which, in a series of articles,
called attention to many instan
ces of excessive rentals in the
community and charged "goug
ing. At the time housing was
acutely short.
The rent control offices were
set up in the armory and Clare
A. Lee was the first area rent
representative. When registra
tions were at the peak it was
found that about 7000 living un
its in Salem and West Salem,
and several hundred in other
parts of the county were under
control.
(Concluded on Page 5, Column 5)
itish Draft
Dollar Policy
London, Aug. 18 VP) A secret
document outlining proposals for
meeting the world dollar crisis
has been drawn up by a com
mittee of top British financial
experts and goes before the cab
inet for approval next week.
If okayed, the four-part do
cument will form basic British
policy at next month's dollar
pound Washington conference,
when Sir Stafford Cripps, Bri
tish chancellor of the exchequer,
and Foreign Secretary Ernest
Bevin meet U. S. Treasury Sec
retary John W. Snyder and
Canadian officials.
Official sources said the four
part document comprises:
1 A study of the background
and causes of, the critical un
balance between the dollar and
sterling areas.
2 A review of what each of
the three governments has done
to meet and redress that un
balance. 3 A close look at the si
tuation as it exists now, under
lining all the implications of a
failure to agree on a solution.
4 A series of proposals aim
ing broadly at achieving some
kind of world pattern which
would allow a free flow of cur
rencies between the dollar and
non-dollar systems.
4 Oregon Cities
Decontrolled
Pnrtlnnrl AilB 18 (U.R) Rent
decontrol in Eugene and Salem,
rHornH Inrlnv hv housing expe
diter Tighe E. Woods, brought
to four the number of major
Oregon cities removed from con
trol.
Similar action was taken ear
lier on Mcdford and Ashland. In
each instance it followed a local
request for decontrol, approved
by Gov. McKay.
r phanon's ritv council has
asked for decontrol. The request
went to the governor's onice
after a public hearing Tuesday
night.
No other cities have decontrol
requests on file, although hear
ings have been scheduled in Al
bany, Corvallis and Oregon City.
The office of E. Daryl Mabee,
Portland area rent control chief,
reported today that it had no in
formation on what might be the
effect in Oregon of Woods' an
nouncement yesterday that ap
proximately one-third of the
country's controlled areas would
have rent ceilings removed in
the next few weeks.
Major Oregon cities, and their
enerniiriHincr area, still under
control in addition to those men
tioned, are Portland, Klamatn.
Falls, Roseburg, Astoria, and
Pendleton, Mabee's office reported.