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About Medford mail tribune. (Medford, Or.) 1909-1989 | View Entire Issue (Aug. 31, 1962)
MEDFORD MAIL TRIBUNE. MEDFORD. OREGON FRIDAY. AUGUST 31. 1962 'filter TO DELIVER SPEECH The popular clos ing night ceremonies at the Oregon Shake spearean Festival theater in Ashland this year will welcome back an Ashland veteran from previous seasons. Richard Graham, shown above with Mrs. Graham and Pro ducing Director Angus L. Bowmer (left), will deliver the ' Our revels now are ended . . ." speech that annually ends the Festival season. Graham, seen previously at Ashland in such roles as King Lear and Coriolanus, is shown here prior to an evening perform ance of the 1962 Festival season. i. . If - 1 i '- - - Your Money's Worth By SYLVIA PORTER Copyright, Hall Syndicate, Inc. TAX OVERHAUL IS KEY TO STRONGER GROWTH i, Editor'! nots: This is the second of two columns on Busi ness Outlook. ..William F. Butler, the nationally respected economist vice president of the Chase Manhattan Bank of New York, be lieves, as I reported Thursday, that we'll be into the fifth recession of post-World War II within a few months. While liei.expects it to be mild, he also thinks we'll not get out of our recent pattern of slow, sluggish growth and incomplete recoveries unless we do something to stimulate our economy. I.Thursday's column ended with Butler emphasizing that lh lag in business investment in plant and equipment ex plains our failure to achieve full prosperity. Here is a con tinuation of his views as he gave them to me at a luncheon 8t the Chase bank this week. ,.Q. Why li;s business investment lagged? j. A. Because of the disappointing periormanct of profits - which have been placed in a squeeze in recent years. While industrial prices on average have remained table, costs have continued to rise and "this has squeezed profits to a level where business cannot afford to lift investments in new plants and equipment high enough to support general prosperity." Q. What can we do about the profits squeeze? A. There are no pat, simple remedies but we must tackle all the forces causing it if we are to get the U.S. back into a vigorous advance. Business must work to keep costs under control and to develop and market new . products which will keep sales expanding. Labor unions must curb wage demands, for excessive wage increases lead only to inflation or unemployment. The federal government must pursue responsible money policies. And we need "a basic revision of our tax structure." Q. What kind of tax revision is necessary? A. The corporate income tax must be cut - from 52 per cent to, say. 45 per cent. The sleep progression in personal income lax rates must be reduced to encourage investment in non-corporate businesses. A general reduc tion in personal income taxes will head off recession. Butler is thinking in terms of a total tax cut of $8 bil lion or so, says, "The Federal deficit need not be in creased by anything like this amount, if at all." Q. Why is tax revision so necessary? A. First, it would check the on-coming recession, Second, it could make the next advance a powerful one. lor it would restore profit margins, lead to higher busi ness mending for more efficient plants and this, in turn, would stimulate all business activity to the point where business spending for expansion of plants again would be essential. Third, it would reduce the deflationary impact our federal lax system now has on the general economy. Taxes today lake so big a total of funds from paychecks and profits when business is rising that the withdrawals themselves lend to choke off the rise after a year or so. Q. But can we afford to cut taxes? A. Butler acknowledges that the chief objection to lax revision program is that it would swell the budget deficit, but he argues. "Actually the surprising thing is that a program of tax revision which effectively stimu lated economic activity might not increase the deficit in the short run and it could produce a balanced budget in brief period, if federal spending is controlled." If we do not cut taxes and we have a recession in 1963, we'll automatically have a big deficit. If we do cut taxes and really stimulate the economy, the deficit next year would be no larger than that which would be created by a recession. Tax revision "is the only way we can get out of the pattern of slow growth and repeated deficits." Q. What would be the effect on our dollar's reputation? A. It won't add to stresses on the dollar if we make It clear we're setting out to restore basic incentives to growth in our economy, are prepared to balance the budget when prosperity has been attained and if we pursue money policies to defend the dollar in the interim. Q. If the administration. Congress and the public get behind this sort of program now. then what? A. If we can muster the discipline and sense of na tional purpose to make these adjustments, "I foresee a - truly phenomenal period of economic growth in the decade ahead." This has been Butler speaking. Of course you ve guessed that the reason I've so painstakingly recorded our conversa tion is that I fervently agree with him. Negotiators on Lumber Issue Will Meet Again Ottawa -HOT- United States and Canadian negotiators end ed Iwo days of talks Wednes day on the U.S. softwood lum ber problem and agreed to meet again soon. A brief statement said both sides had discussed the im pact of Canadian lumber ex ports on the U.S. west coast industry and the long-term lumber situation for both countries. "The delegations will re port back to their respective governments and consult with their industries," the state ment said. The talks were initiated at the suggestion of President Kennedy following pressure by Congressmen from lumber states in the U.S. northwest. Solution Expected Kennedy made the request a month ago, asking for ne gotiations on possible volun tary quotas by Canada on its lumber exports. Sen. Warren G. Magnuson (D-Wash.) said he was confi dent the two nations could work out an equitable solu tion. A spokesman for the Lum ber Manufacturers association in Washington said it was hard to judge at this point how the talks were going. He said the association might have a comment when more information was available on details of the Ottawa discus sions. "I think all of us are very pleased that they (Canada) would sit down and talk about the problem," he said. ' Albany To Revert ; To Standard Time I Albany VPl- Oregon s check frbtiarri time pattern starts! changing again Monday. I Albany civic and business leaders, w'io iisd informal fa-t time during the summer. County Assessors Elect Eugene Man Three Accidents Reported in Area Three accidents were re ported to slate police Wed nesday. No injuries were re ported. About 12:50 p.m. Wednes day a car operated by Elsie Odessa Pratt, 35, of Dunsmuir, Calif., struck a parked car be longing to Betty Ann Ritchie, of 431 Hospital dr., Ashland, on High way 89 between Phoe nix and Talent. Slate police said the ' itch ie vehicle was parked along the highway while the oper ator was obtaining gasoline when it was struck by the Pratt vehicle. A rear-end collision was reported on Highway 62 near Prospect Wednesday, but no injuries were reported. Ve hicles operated by Roy Charles Thomason, 31, of Susanville, Calif, and Amos Anderson Smith, 66, of 209 Gibson St., Talent, were in volved. About 1:40 p.m., a vehicle operated by Grace Hope Orr, 69, of 5969 Table Rock rd., was sideswiped by a pick up driven by Robert Lee Oday, 53, of 1353 East Mc Andrews rd., police said. ELECTED PRESIDENT Corvallis, Ore. - ilPli nr. Horace L. Barnett, West Vir ginia University, Thursday Klamath Falls - UTI' - Ken- was elected president of the ncth Omlid of Eugene has , oociciy or Amer been named president of the Oregon Stale Association of ica. Khrushchev Faces Fateful Decision on Berlin Crises By STEWART HENSLEY Washington - HW - Soviet Premier Nikita Khrushchev faces a fateful decision on Berlin. His next move could spell the difference between peace or war over the long smouldering issue. He has put himself on the spot by intensifying his threats to make a separate peace treaty with Communist East Germany and isolate the United States and its occupa tion allies in their exposed position in West Berlin. But he has yet to name the date. Top American officials think he slill is weighing the I consequences. Lengthy talks between So viet and American officials in New York, Washington, Ge neva and Moscow over the past 10 months have produced a complete deadlock on the central issue: Khrushchev's demand that the allies pull out of West Berlin and permit it to become a demilitarized "free city" at the mercy of the surrounding East German Communists. President Rejects President Kennedy has re jected this en toto. He stands firm on the position that the United States. Britain and France are in West Berlin on the basis of war-won occupa tion rights which cannot be liquidated short of an all-German settlement based on re unification of the country. Sporadic Soviet - American diplomatic contacts are con tinuing, apparently because each side is fearful of the consequences of losing touch entirely and risking war by miscalculation. Red satellites and neutral ists are beginning to ask em barrassing questions. The Soviet premier has a choice of three courses, as top American officials see it. He can: -Conclude the long-threat ened treaty witn Communist East Germany and run the risk of war by giving the local Reds complete authority to interfere with and control allied access to the city. Ken nedy has warned that the Americans will not tolerate Communist German control and will fight if necessary to stay in the city and keep the access routes open. -Go through with the treaty but retain Soviet responsibil ity for guaranteeing the al lied access rights. This is the sort of deal the western pow ers could "live with" if they had to. They insist Russia is bound by wartime agreements to keep the routes open and cannot hand over this author ity to the East Germans. -Back down and let the issue slide for the time being, risking increased complaints from the East German regime and loss of face throughout the world. Realizes Danger Most U.S. officials appear to believe Khrushchev is con vinced of Kennedy's firmness on the central issue and re alizes the danger of war if he follows course number one. At the same time, they doubt the Soviet premier can adopt the, try to save face by arranging third choice. some sort of treaty but will The betting here is that I stop short of action which Magnuson Sees Lumber Solution Washington-(UPli -Sen. War ren G. Magnuson (D-Wash.), one of the leaders of the con gressional lumber bloc, says he is confident the United States and Canada could work out an equitable solution to the softwood lumber issue. Magnuson said he still was hoping Canada would volun tarily cut back its softwood lumber exports to the United States "until we can work out these things on a techni cal basis." The first phase of US-Can-adian negotiations on the lum ber issue ended Wednesday in Ottawa. A statement issued in Ottawa said the talks would be resumed in the near future. 100 rft ntjlnl tpir.lt 80 Droit, Intcrrut.Oflf! D'tMleritt Co., L Ik, decided to turn their clocks County Assessors. back Monday so that schools could open on standard time. Most of the state, and the country, will wait until Sept. 30 to make the switch. succeeds Clyde Cald- Klamath County asses- Who are WHJTE He well, sor. Other officers elected were Robert Lyons, Bend, first vice-president: and Don Hat tan. Oregon City, second vice president. Glenn Horn. Mad ras, was reelected secretary treasurer. The 50th annual convention will end today. DEER HUNTERS! Let us process your deer this season. Custom Butchering and Cold Storage VALLEY LOCKERS & MEATSmkon' ludd Carr Sranoil Britlun 5151382 ultimately Khrushchev will take the second course - a treaty which would still with hold from the East Germans control of the access routes. Russia could write a protocol to this effect into the treaty. Secretary of State Dean Rusk acknowledged during meetings last month in Ge neva with Soviet Foreign Min ister Andrei Gromyko that the United States had no way to block a Moscow treaty with East Germany. However, he warned that Washington would consider it nothing but a "scrap of paper" and concede no sovereign rights to East Germany. He told Gromyko the Russians should be careful not to start or sign anything they could not control. Try To Save Face I There are several factors which lead top officials here to believe Khrushchev will might provoke open warfare: -The Soviet leader, plagued by economic difficulties at home and ideological troubles with his Red Chinese allies, is not in a good position to risk war. -Khrushchev told Austrian Chancellor Alfons Gorbach in Moscow in June that he was certain he could handle a treaty without forcing things to the point of military con flict with the West. He said he would let the allies retain access rights for the time be ing and count on "whittling" them away later. Khrushchev's present set of Berlin demands were first made on Thanksgiving Day, 1958. in a long memorandum to the United States. A lengthy Big Four foreign ministers' conference in Ge neva in summer, 1959, failed to make the slightest progress. Western proposals for set tling the whole German ques tion by reunifying the country i which have failed to make any under genuinely free elections i dent on the central issue were flatly rejected by the Russians. Renewed Demands President Kennedy inherit ed the deadlocked dispute. When he met Khrushchev in Vienna in June, 1961, the So. viet leader renewed the de mands, setting them forth in extremely ugly and tough terms. He apparently sought to stampede the new president into concessions. Kennedy reacted by order ing an increase in overall American military strength and sending more troops to join the six U S. divisions al ready in West Germany. Then began the long scries of So viet - American negotiations American ofiicials believe Ihcir first word that Khrush chev is preparing to actual ly sign an East German treaty - if he so (U'ciues - probably will come through neutral na tions. They believe ivhrushchev would be anxious to rally as much neutralist support as possible, hoping to persuade a large number to follow his lead in recognizii g the sov ereignly of the F.ed German regime. Presumably he would want to explain in advance his reasons for the move. And the neutrals are notoriously poor secret-keepers. Thus, as summer simmers i away along the humid banks i of the Potomac, U.S. officials keep a wary eye on the Com munists across the grim Ber lin Wall. And tbey also are listening to reports and ru mors in the neutralist camp which may tip off Khrush chev s eventual intentions. FEDERAL AUTOMATIC ALARMS Insurance can't replace children, priceless belong ings, or business papers. For free estimate on fire or hurglar alarms for home or business, safe pro lection, door bells and signaling systems, call 773-1754 Belter a Year too Soon Than a Day too lalel ' You wouldn't call a baker to pave your driveway! 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