MEDFORD MAIL TRIBUNE, MEDFORD, OREGON
Tax Reduction May Influence
Future Policies for Economy
XT I -r mi . ...
THURSDAY, NOVEMBER 7, 1863
WASHINGTON (CO) - Tho
success or failure of the Ken
nedy Administration's tax pro
gram will exert a major inllu
cnce on future govern m e n t
methods of economic stabiliza
tion. If the public accepts the prin
ciple of reducing taxes to pro
mote economic growth the
principle embodied in the tax
bill now in a Senate committee
it could provide Government
officials with a new method of
countering recessions. More
over, should a major economic
stimulus result from enactment
of the tax bill, it would be used
as an argument for further in
novation with tax policy to
smooth fluctuations in the na
tion's economy.
These implications of the $11.1
billion tax reduction bill have
been little discussed, partly be
cause the implications would
not be evident in the immediate
future and partly because the
Administration apparently fears
a hostile public reaction to such
an economic role for the Fed
eral Government.
But- the principle reason for
overlooking the issue appears
to be that the battle over the tax
bill has been joined on the im
mediate and practical grounds
of economic prosperity.
Admin istration spokesmen
have repeatedly argued that tax
reduction is necessary to free
the economy from five years of
inadequate growth. They also
assert that a recession in the
near future is more likely than
not in the absence of tax cuts.
.Opponents -reply with an
equally practical theme: taxes
must not be lowered without a
corresponding cut' in Govern
ment expenditures. The opposi
tion to rising expenditures has
been the principle hindcrance to
quick passage of the bill.
Planned Deficits
Some opponents, particularly
Rep. Thomas B. Curtis, R-Mo.,
also challenge the Administra
tion on other grounds. Curtis as
serts that President Kennedy
"is advancing a new and untried
fiscal theory for the United
States, the theory of deficit fi
nancing, the theory of planned
deficits."
Curtis chides the Administra
tion for refusing to talk about
planned deficits despite Ken
nedy's June 1962 speech at Yale
University in which he called
for a national debate free
from political cliches about
the Federal Government's size
and fiscal policies.
Demand Stimulation
The Administration's fiscal
policies have, been aimed at ex
panding economic activity. Es
sentially, the federal budget de
ficit meant the Govern m e n t
seeks to stimulate demand in
the economy by spending more
than it is taking out in tax rev
enues. Government spending to stim
ulate lagging private demand
has attained increasing public
acceptance since New Deal
days. But in the postwar era,
Administrations have not delib
erately undertaken deficit
spending plans as an expansion
ary device for the economy.
In this regard, history prob
ably will credit the Kennedy Ad
ministration with breaking new
economic ground.
The Kennedy aconomists must
also take the responsibility for
deliberately adding tax policy
to the Government's chest of
tools for tinkering with the na
tion's economic mechanism. The
burden of responsibility is made
all the greater by combining de
ficit spending with tax reduc
tion. Postwar Tax Reductions
The U. S. has had postwar ex
periences with tax reductions
(1948 and 1954), but they were
viewed as tax reforms and not
as economic stabilization mea
sures. Nevertheless, many econ
omists credit those tax reduc
tions with softening recessions
in 1949 and 1953-54.
The use of tax policy to in
fluence the nations economy
was discussed in the Eisenhow
er Administration and in Con
gress at the time of the 1957-58
recession. Again in the summer
of 1962, when it was feared the
recovery from the 1960-61 reces
sion was slowing, there was.
talk of a "quickie" lax cut. No
action was proposed at either
time.
Public acceptance of the tax
reduction principle contained in
the bill now before Coneress
would increase the likelihood of
fiscal policy being used more in
the future to reduce fluctuations
in the economy.
The economy already has a
number of automatic stabilizers
that work without the need for
policy decisions by officials.
The most important ones are
the personal and corporate in
come taxes and unemployment
compensation.
If, as in the past, the nation
moves toward more sophisti
cated methods of stabilization,
the next step may be in the
direction of temporary fluctua
tions in, the tax level in re
sponse to changing economic
conditions.
Kennedy already has ad
vanced one proposal. He asked
Congress in 1962 for standby
discretionary authority to . cut
personal income taxes a maxi
mum of 5 percentage points for
six montns, with the right to
extend the cut another six
months. Congress would have
the right to veto any such legis
lation. Congress, jealous of its tax
writing authority, did not even
consider the proposal.
What has been called the
"puritan ethic" opposition of
many Americans to cutting
taxes while the federal budget
is unbalanced suggests that the
economists who favor new in
novations with economic stabili
zation have yet to win general
acceptance for their views.
For this reason, the success or
failure of the Kennedy Adminis
tration tax program in achiev.
ing economic growth undoubted
ly will have an important in
fluence when new economic
stabilization policies are de
bated in future years.
(Copyright 11163,
Congressional Quarterly Inc.)
Miliar' t
Favorable Outlook for Investments Is Expected
D 5
A favorable outlook for in
vestments for the remainder of
1963 and well into 1964 due to
higher and better quality earn
ings and expected dividend in
creases was reported here this
week by Edmund E. Hass, vice
president and manager of the
Medford branch of Pacific
Northwest Company, and Bruce
T. Mills, registered representa
tive ot the company, on their
return from the annual sales
convention in Seattle.
It was the concensus of the
New Semi-Conductor
Saves Recharge Time
NEW YORK (UPI) - ,A
new semi-conductor called the
stabistor" is what enables
makers of shavers and other de
vices using rechargeable nickel
cadmium batteries to cut re
charging time from 15 hours to
about one hour.
The stabistor is technically de
scribed as "a controlled double
layer diode with a low dynamic
impedence. It was developed un
der an Air Force contract by P.
R. Mallory and Co. ot Indianap
olis.
KEEPING WARM - "Miss United States," 18 year old Michele
Mctrinko, foreground, of New York, clutches her long coat about
her as she tries to stay warm during the bathing suit event of
the Miss World pageant in London. Others are, from left, Louise
Crous, 21, "Miss South Africa"; Sonja Russ, 18, "Miss Austria",
and Susie Gruner, 19, "Miss Germany." (UPI)
TOURNAMENT SCHEDULED
EUGENE (UPI) -Nineteen
colleges and universities from
the Northwest are to partici
pate in the sixth annual Oregon
Forensic Tournament Friday
and Saturday at the University
of Oregon.
HAIR-RAISING COSTLY
NEW YORK (UPI) - Ameri
can men spend about $75 mil
lion annually to keep their hair
well groomed, according to
Printers' Ink, the weekly maga
zine of advertising and marketing.
Convicts Used To
Study Methods in
Healing of Wounds
By DELOS SMITH
UPI Science Editor
NEW YORK (UPI) - The
arms of seven convicts pro
vided an impressive if tenta
tive answer to the old question
of whether a wound heals faster
when it is bandaged than when
it is left exposed to the air.
The San Quentin Prison in
mates volunteered the experi-
Pacific Northwest Company
that statistically speaking the
general earning trends of cor
porations are of good quality
and the market high at present
not high when compared to its
1961 level.
Leading topics discussed at
the annual meeting were muni
cipal bond department, trading
department and institutional de
partment. Speakers appearing on the
program included Milton Lewis
of Natural Gas Securities, one
of the leading utilities analysts
in the United States, Hass said.
Others were William Street,
chairman of the board of United
Pacific Corporation, parent
company of Pacific Northwest
Company; Robert Hansbergor,
president, Boise Cascade Cor
poration; William Moseley
Jones, president, Pacific. Sav
ings and Loan Association; John
Rupp, vice president and gen
eral counsel, Pacific Northwest
Bell; Warren Raymond, presi
dent, Equity Fund, and Robert
Daniel, president of the Pacific
Notthwest Company,
Salt Lake City Voters
Re-Elect Bracken Lee
SALT LAKE CITY (UPI) -Veteran
Campaigner J. Bracken
Lee, a conservative who op
poses the income tax and the,
United Nations, was picked two-to-one
by Salt Lake City voters
Tuesday for his second four
year term as mayor. . ..'
SAVE
FOR
THE
FUTURE
Just as the industrious beaver plans for the
winter ahead, wise people save for retirement
income, their children's education or for a
better way of life. Regular deposits in a sav
ings account- at The Oregon Bank are iutly
insured, as they grow. Plan for your future at
The Oregon Bank. ' -
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ISO NEED FOR, A HEAVY FOOT!
When you first take the wheel of a new 1964 Cadillac,
you're going to be amazed!
For this latest "car of care" has attained a level of
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Cadillac's new performance is the result of many
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mental use of their arms by
Cameron u. Hinman ana How
ard Maibach of the University
of California, School of Medi
cine, San Francisco.
Hinman and Maibach took
slices of skin from each arm
tiny slices about one-fifth of an
inch long, but deep enough to
include the top-most skin layer
ana tne layer beneath, it was
painlessly done, of course, un
der local anesthesia.
Half of each man's wounds
were covered over with poly
ethylene film which is the ulti
mate ot air-exclusing bandage
since it admits no air whatever,
The other wound was left ex
posed.
Skin Samples Studied
On the 3rd, 5th, 7th and 9th
days after this slicing the scien
tists punched very tiny samples
from wounds, sliced tne sam
ples and then studied the slices
under nign magnification.
The wounds which got no air
began acquiring a covering of
new, healthy skin so much
more rapidly than tne open
wounds there was no need to
measure to prove it, the scien
tists reported.
But measure they did and in
all comparisons the bandaged
wound healed two to five times
faster than the exposed one. By
the 7th day all wounds were
covered over with new skin,
however, and by the 9th all
were completely healed.
The scientists were reserved
in describing their experimental
results in the technical journal,
Nature." In the past, they
said, excluding all air from
wounds invited infection be
cause tight dressings created
moisture which permitted mi
crobes to multiply.
Infection Danger Lessened
But now skin infections can
be prevented with antibiotics,
they continued, and there was
not a sinele infection in their
subjects thanks to the generous
use of an antibiotic solution.
"We do not know whether
these observations will fall in
the realm ot biological curiosity
or It they will have practical
importance in the treatment of
cutaneous (surface) wounds and
burns in man."
The ultimate answer will be
given by surgeons and physi
cians emboldened by this ex
periment and a previous one of
George D. Winter, English ex
perimental scientist, to keep the
air out of the wounds and burns
of large numbers of patients.
Winter's experiments embold
ened Hinman and Maibach to
undertake theirs in human be
ings. Winter experimented with
pigs. He found pig wounds heal
faster when their surfaces are
moist than when they are dried
out by exposure to aid. Like the
Californians, ne prevemea in
fect on with antibiotics ana ex
cluded air from some wounds
with plastic coverings.
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SAKE "TECHNOLOGY"
NEW YORK (UPD-Thc skill
of the typical professional safe
cracker today is far greater
than that of his counterpart who
operated in the days prior to
World War II. says the Safe
Manufacturers National Associ
ation. This upgrading has
stemmed largely from war-Inspired
technological improvements.
BIG PRINT USER
NEW YORK (UPI) - News
papers in Missouri use 195.000
tons of newsprint a year 35,000
tons more than all of Africa's
160.000 according to the News
pUt Information Committee.
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