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WASHINGTON UP1 - Presi
dent Kennedy asked Congress lo-j
day to recapture about a fifth of I
his proposed (11 billion tax cut
for individuals by clamping dras
tic limits on deductions.
His proposal would limit deduc
tions for such things as home
mortgage interest, contributions,
medical expenses and local taxes.
Only that portion of the total
amount which exceeds 5 per cent
of the taxpayer's income could be
deducted.
The sweeping nature of the plan
was Hie surprise clement in a
9,000-word message in which Ken
nedy spelled out his anxiously
awaited request for a three-step
reduction in personal and corpo
rate tax rates.
His blueprint also called for
new lax preferences for most per
sons over 65, for many working
mothers and for professional ath
letes, authors and others whose
earnings fluctuate widely. He
urged tougher tax treatment for
the oil and gas industry, stock
In The
By FRANK JENKINS
From Washington this morning:
The Cuban issue erupted with
renewed force in the Senate yes
terday over reports of a new
around the - clock Soviet mili
tary build up on Fidel Castro's
island.
Senator Wayne Morse of Ore
gon called for an immediate in
vestigation. He asked the Slate
Department for a quick brieling
(or his Senate Latin-American af
fairs subcommittee. Senator Keat
ing of New York, who was one
of the first to sound the alarm
last year over reports of offensive
Soviet missiles in Cuba, told a
reporter this morning that he has
confirmed by official government
sources that a new INTENSIVE
buildup is under way there.
Senator Keating says that Cuba
is now TEN TIMES stronger than
it was last July 1 just before
the Soviet missiles and bombers
later withdrawn under pressure
from President Kennedy were
landed there. He says the weapons
being newly added include MIG
(igiiter planes capable of carrying
nuclear weans with a range
that would cover many areas in
the United Stales and Canada.
He added:
"I don't know whether they have
nuclear weapons. I don't know
that they don't, cither. I do say
they are capable of carrying nu
clear weapons. I have made no
statement which is not confirmed
by official government sources."
State and defense department
officials, however, say that Soviet
arms supplied to Cuba arc alxxil
what they were at the beginning
of the year.
What's really happening in
Cuba?
And WHY is it happening?
It's hard to say.
So MUCH big-time politics is
wrapped up in the Cuban situa
tion. When President Kennedy told
Premier Khrushchev to GET HIS
OFFENSIVE MISSILES OUT OF
CUBA. OR ELSE, and Kroosh
GOT THEM OUT, and was quick
about it. with no back talk, it
was a tremendous victory for
- President Kennedy. Almost in a
matter of hours it changed his
public imase from that of a some
what hesitant young man who
didn't quite know what to do next
to that of a confident and (earless
Chief Executive, capable of meet
ing any crisis that might arise.
At the same time, it chansod
the imaee of Premier Khrush
chev and the change didn't add
anything to his .stature.
All of which nurtures the suspi
cion that Old Krnosh has some
cards up hi sleeve which he
basn t pla.ved jet.
What's in the wind''
We can only guess but this
seems to lie' a REASONABLE
gUCS.-
If craity Old Kroo-h had il in
mind in the (irM place to build
Cuba into a nuclear base from
which he could launch a nuclear
attack on the United Slates that
would so cripple us that we would
le unable lo retaliate DE
CIMVELY, he was forced to mil
in Ins horn. He luiincl President
Kennedy tougher than he had ex
pected But he can't allord to he too
humhlc So. what he mav have
in m;rA i to make ol ( l'm a
ba-c o! opera! :! irom which he
tan effectively EXPORT (DM
MUSLIM to all of America
Ir, order tn cot awav with that
protect, he mav be onnVr!,.k:r2 ,A
mai-e Cuba tc strong DEFEN
SIVELY for us lo tackle sa:clv.
We 11 see what we II see.
i
Day's lews
dividends and stock options en
joyed by some corporation execu
tives. Cancels S3. Billion
The President said his proposed
"reform" in deductions would
cancel out $2.3 billion on the $11
billion tax cut he wants to give
individuals to pump more pur
chasing power into the economy
and revitalize business.
He said it also would mean that
some 6 1 million of the 25 million
taxpayers who now itemize de
ductions would find it more, or
equally, profitable to take the
standard 10 per cent deduction
and file a short return.
However, Kennedy's tax blue
print would give iow-income
groups a better break on deduc
tions than they get now. It would
establish for the first time a min
imum deduction $300 (or a sin
gle person or married couple plus
$100 for each dependent. Every
one would get that much regard
less of deductible expenses or income.
High yesterday
Low lail night
High year ego
Low yeer ego
High pail 14 years
Low pail H yean
Precip. past 24 houn
Since Jan. I
Sam period tail year
S! tiesi)
-1 (US')
Leaislafors
New Red Buildup
In Cuba Revealed
WASHINGTON (UPD - State
Department officials will brief the
Senate Latin American affairs
subcommittee Friday on reports
of a new Soviet military build up
in Cuba.
Sen. Wayne Morse, D-Ore.,
asked the State Department to
provide information Wednesday
amid Republican demands for a
new Senate investigation of the
abortive 1961 invasion of Cuba.
The closed-door session of
Morse's subcommittee was sched
uled for Friday. A committee
pokesman said he did not know
who the Stale Department would
send to brief the committee, but
said he presumed it would be
"their best informed people.
Sen. Kenneth Keating. R-N.Y.
said he had evidence that the mil
itary build up in Cuba is 10 times
greater than it was last July prior
lo the missile crisis.
"Tanks, guns, MIG fighters and
other arms arc continuing to pour
into Cuba," Keating told a report
er. He said his intormalion was
based on reports from Cuban
refugees.
"The military strength there is
10 times greater than it was on
July I." Keating said.
"Very Serious Situation"
He said he thought the reported
Milk Price
Gets Study
SALEM i UPD The price of
milk and the size of a loaf of
bread got their first legislative
consideration lodav at a meeting
of the Hou.-e Committee on Food
and Dairying
The committee, already caught
between dairymen and milk dis
tributors, discussed milk price
legislation that has not vet been
introduced
"There is no question that this
is going to come up." Chairman
Victor Ativeh. R-Boaverton. said
"I think we shou.d look (or
something to stabilize the Indus
try in Oregon." he said. "This is
a complkatcd problem
The committee had before it a
rough draft of a bill requested by
Oregon milk producers, expected
lo !c introduced bclore Inn
It calls lor milk distributor
pools, similar to those provided
in the 1961 milk control legisla
turn that expired at the start of
this vear D.airvmrn sav the 11
legislation stabilized the industry
Hie committee also had before
it a statement i-sucd Wednesda
hv distributors, who process and
sell the milk, represented by the
legislative committee of the Ore
zon Dairv Industries.
It opposes the dairymen's pin
posal. and sas the I'.n.l hill "con
tribiited to instability." Tne -late-mr-nt
said the weakness I.cs in
the failure of the program to con
tml out-of-state milk.
The committee also considered
t:-,e problem of the "balloon loaf"
ol bread - a one pound loaf
naked in one and one-half pound
,an to make it fluffier.
As a result, between 730.000 and
1.000,000 low-income taxpayers
would be removed from the tax
rolls. This would be in addition
to certain old people who would be
relieved of tax liability under
other rule changes.
Kaiscs Problems
Obviously aware that the deduc
tion proposal will face trouble in
Congress, Kennedy said "the
present practice of allowing tax
payers to deduct certain expenses
in full. . .raises diflicult problems
of equality, taxpayer compliance
and tax administration and en
forcement." As for his overall proposals,
which would mean a net cut of
M0 2 billion in taxes, the Chiel
Executive said:
"Our economy is checkreined
today by a war-born tax system
at a time when it is far more
in need of the spur than the bit."
He dismissed congressional
complaints that the current peri
od of heavv red-ink snendin" is
no lime to cut taxes. He said thel
Price Ten Cents 28 Pages
build up posed a "very serious
situation" for the United States.
Keating said it is much more im
portant at this time than the ques
tion of the cause of the failure of
the Bay of Pigs invasion in April,
1961.
He said he was not opposed to
an investigation as proposed by
other Republican senators into the
invasion fiasco but he thought
senators should be cornered first
with w hat he said was the current
military threat.
Democratic foreign policy ex
perts objected to a Republican de
mand for a new Senate investiga
tion of the Bay of Pigs invasion.
"The Bay of Pigs incident was
terrible," said Sen. John J. Spark
man, D-Ala., "but I don't believe
any further investigation would
serve the national interest."
"We had an investigation which
was conducted in a bipartisan
manner," said Morse. He added
that he did not favor disclosure
of data, supplied as secret, "just
to satisfy a group of Republicans."
Held Closed Inquiry
Sparkman is a member of the
Senate Foreign Relations Commit
tee. Morse is chairman of the
committee's subcommittee on La
tin America which conducted a
closed inquiry shortly after the in
vasion attempt.
Sen. Barry Goldwater. R-Anz.,
raised a new cry for an inquiry
Wednesday. He proposed a full in
vestigation of the Bay of Pigs in
cident bv the Senate Armed
Services Committee of which he
a member.
Senate Republican Leader Ever
ett M. Dirksen, III., had previ
ously announced he would under
take a "preliminary exploration"
of the matter. Chairman J W'. Ful
bright. D-Ai k , said he thought
the move was politically moti
vated. Both GOP proimsals followed the
statement by Ally. Gen. Robert
F. Kennedy that no air cover was
ever planned or promised for the
ill-fated invasion force. That, said
Goldwater, was contrary to the
general understanding of the cir
cumstances.
Former President Dwight D.
Eisenhower sa.d Wednesday night
the Bay of Pigs invasion, which
took place alKnit three months aft
er he lett office, was not con
ceived during his administration.
140 Killed In Record Cold
By United Press lnlrrnatlnn.il
The century's worst cold wave
smashed south todav. shatterm
tcmporatuie re o r d s. closing
schools and resulting in the deaths
of moie liian 1 40 jietsons.
low temjieralme records that
have stood since beloie the turn
of the century weie shattered.
Damage to eiamg crops anoss
the southland ran into liwu-ands
of dollais ai d Florida citrus grow
ers glided for another (old seice.
.Southern California crop dam
a.e ran into the millions Cttius
nd vcriah e croi s in th lush
Rio (iiatnle Va.lcv in Texas were
I imperiled by the latest onslaught
j of polar cold.
deficit would be $V billiun next
vear even without a tax reduc
tion. And he called the prospec
tive revenue loss a piddling price
tor prosperity.
As for proposals that he cut his
record $H8.8 billion budget to
clear the way for tax lelief, Ken
nedy said he had proposed spend
ing the minimum needed for na
tional security and the Soviet
challenge in space. He said it
would be "a grave mistake" to1
cut it.
Democratic leaders believe-
and all advance signs indicate
that Congress will wind up voting
a tax cut this year. But they be
lieve Kennedy will get lew of the
revenue-boosting "reforms" he
wants.
The President showed no signs
of surrender, however.
He said the largest single bar
rier to full employment of our
manpower and resources and to
a higher rate of economic growth
is the unrealistic drag ol federal
income taxes. . .
Study
St
'X X -
JX . 'X :
MUMMWaii lattaat ' - "in a muni- --mill l i r in rth T" '- '
CORDIAL GREETING, MAORI STYLE Mrs. Olive B. Cornett affixed a Kiwi pin on the
lapel of Jim Monteirh, Klamath County Chamber of Commerce president, before touch'
inq noses with the recipient in the manner of a Maori tribal member of New Zealand.
Mrs. Cornett made the presentation at the chamber of commerce meeting Wednes
day in observance of the relationship of Klamath Falls and Rotorua, New Zealand, as
sister cities. Mrs. Cornett later went through the ritual with Chamber Manager
George Callison, who nearly shattered the proprieties in doinq so. Calliion misun
derstood the ritual and set his lips to bestow gentlemanly buss upon Mrs. Cornett.
"Oops," Callison said, before checking himself in time to touch noses with the lady
in the best tradition of a Maori tribesman.
House Committee Readies
Bills To Cut Property Tax
SALEM 'UPD Bills to cut lo-1
cal property taxes by 10 to as
much as 85 cr cent were prom
ised Wednesday as tlw House Tax
Committee heard a rcrt on the
tax woes of the farmer.
Rep. Richard Eymann. D-Mar-cola,
chairman of the committee.
said a bill is being drafted to re
duce local property taxes by
about 10 per cent.
It would lie dune by collecting
additional state income tax that
would be returned to the counties
to offset properly tax cuLs.
Rep. Cornelius Bate-on, D Sa
lem, said he is having a bill prc-
I Violent snowstorms off the Great
U,.,, dumped 11 inches of fresh
snow
Pcnimlvania and New
York West Virginia was hit with
10 inches of new sr.ow ami lesser
amounts fell el.-ewhere. Roads
weie treacherous Irom Michigan
lo the m.ddle Atlantic stales and
di ivei s we:e wai nod to stay home
Thou.-ands of school were
closed by diifting snow and cold
Irom Pennsylvania lo Iowa.
lii.tril Pre-s In'.ei national
((Hinted HI weather-attri)H,ted
ilratj,
in-lnna led tne nation
Iwith 2'J
Illinois hal I'l. Ohio II
land Texas and Michigan recorded
"One recession lias followed an
other, with each period of recov
ery and expansion fading out ear
lier than the last. Our gains iall
far short of what we could doj
and need to do."
As previously revealed, Kcnne
dy's plan would reduce individual
income tax rates in three annual
steps from the present 20 to 91
per cent to a new range of 14 to
65 per cent.
The top rate, as at present.
would apply to income in excess
of $200,000 a year ($-100,000 for
married couples filing jointly). At
the other end of the scale he pro
posed a new U per cent bracket
It would apply to the first $1,000
of taxable income for single per
sons and the first $2,000 for mar
ried couples.
Although Kennedy's lax pack
age contained many revenue
boosting provisions, officials said
Treasury calculations indicated
that it would give some tax re
lief to everyone except for a
"handful" of individuals who op
KLAMATH FALLS, OREGON.
at e's
pared to lower local property tax-
cs by TO lo 85 per cent. It also
would be accomplished through
substitution of additional income
lax.
Batcson said his proposal is
based on the premise that serv
ices benefiting the general public.
such as schools, sliould be paid
for by the general public, while
the costs of services specifically
benefiting property owners, such
as some mlice protection, should
be borne by the properly owners.
The bills were mentioned during
an orientation report on the farm
tax situation in Oregon
10 each. New England had 15
deaths.
All-time records for the 2nth
Century were set at Akron, Ohio,
21 below; Atlanta. 3 below; Bowl
ing Green, Ky., l!t below; Cleve
land. Ohio. 10 below: ljxington.
Ky . 21 below : Louisville. Ky , 20
below, and Pittsburgh, Pa . IH
below.
In the South Carolina cities of
Anderson, Columbia. Greenville
and Spartcnburg Jan. 2t reioids
were shattered with temperatures
of 9 above.
The mi rcury chopped to an un-
official 30 below zero at Kingston
Springs, Tcnn., and 23 below at
Somerset, Ky,
erate almost entirely in oil and
real estate. They would pay
more."
Other major points:
Individual Withholding To re
flect lower tax rates that would
apply to l!U3 income, the with
holding rate would be cut almost
14 per cent, ellective July 1.
Since Congress is not likely to
complete action on any tax legis
lation before late summer, the
Treasury anticipates it will have
to refund unusually large amounts
when taxpayers compute their fi
nal iota tax bill. Tax rates would
Ik lower still on 1964 income and
again on 13 income.
Corporations They now pay 30
per cent in tuxes on the first $25,
000 in earnings. This would drop
to 22 per cent on lota income.
Earnings above $25,000 now are
taxed at 52 per cent. This would
be cut to 47 per cent over a two
year period, starting next Jan. 1.
Kennedy said the biggest percent-;
age cut would go to the 450,000
corporations which earn $25,000 or
THURSDAY, JANUARY 24, 1963
Higher
Dr. Grant E. Blanch of Oregon
Stale University said the farmer
is being crushed by property taxes
that eat up 26 per cent of his net
money income.
Sewer Line
Connection
Fee Upped
Elfective Feb. I, the connec
tion fee to hook up with pipe
ncs of the South Suburban Sani
tary District will he increased
Irom $00 to J 180. according to
information disclosed by the dis
trict Thursday.
Connection orders received be
fore Ihe rate change is lo take
place will be charged under the
old rate even though the cus
tomer may not wish to have the
nslallalion made until some lu-
lore dale, the district said.
The connection fee is a charge
made by the di-trict to furnish a
onnec ting pipe from live main or
latcial pipes in Ihe ftrcet lo the
property line of the customer.
'It has been lound that the cost
of making these connections on a
unit basis is greater Ulan was
lormeriy possible when crews
could work on a street on a pro
duction line basis," it was slated
less rather than to the 135.00G
larger corporations.
Tougher Tax Treatment
Changes in tax rules would sharp
ly boost taxes of the oil and gas
industry, raise taxes on income
individuals receive from stock
dividends and curtail tax benefits
enjoyed by corporation executives
who have options to buy stock in
their firms.
Thus, the impact of Kennedy's
tax program would vary widely
among individual taxpayers.
For most individuals this rule-
of-thumb would apply. If you
have been taking the standard
deduction (10 per cent of your in
come but not more than $1,000),
your lax bill would be cut by p
bigger percentage than if you
have been itemizing your deduc
tions. The Treasury cited the case of
married couples w ith two children
and income of $7,500 from wages.
Those couples taking the stand
ard deduction now pay $877 a
lyear in federal taxes. They would I
Telephone
Ediscat ion Progra
Budget 'Not Padded,1
Claims In
SALEM (UPD "We aren't
coming in here with any idea our
budget can be cut," Higher Edu
cation Board President William E.
Walsh said Wednesday tn the ed
ucation subcommittee of the Jointl
Ways and Means Committee.
Walsh, a Coos Bay attorney
pounded tile table with his fist, and
poked his eyeglasses toward leg
islators as he barked This is our
budget. It is not a rubber stamp!
for educators.
The colorful appearance marked
the opening of the subcommit
tee's orientation on higher educa
lion needs.
"I want raprt between this.
committee and our board. Wo
have felt in the past thai the leg
islature has been critical of our
staff, and that we have been less
than' honest.
"Wo are all working for the
same boss. If our staff holds
back, come to us so we get on
the right footing.
'We're not trying to put any
thing over. It's not our money
any more than it is yours. Higher
education is honest in its prcsen
tation."
Walsh, speaking in a loud and
gruff voice, looked bodily at the
sub-committee members as he
pounded the table and snapped
Tins budget is not padded.
Problems Known
I know what you are up
against. When we are through we
want you to know what we arc
up against." he said.
Rep. Stafford llansell, R-ller-
miston, asked Walsh s views on
one board to handle both higher
and lower education.
Walsh replied, "All we can do
is handle higher education. One
board is all right If you want to
delegate authority to staff peo
ple."
Chancellor Roy E. Lieuallen
outlined how student enrollment
was expected to increase by 35
r-mmmmrmmmmm-"L jmi ' ' u t .in..sni.aei imi apiepaMgtwii' s"'se" "lewm1 a
fry;!
;ffrf: - . - ; i
SUCCESSFUL BULL SALE The third annual bull sal sponsored by the Klamath
Cattlemen's Association reiulted in th sal of 79 bulls Wednesday, afternoon for
total of $40,770. The sal included 69 Hereford! averaging $531 each, two Short
horns averaginq $400, and nine Angus averaging $480. Total sale average was $522
par bull. Norman Jacobs is president ef the sponsoring group. Howard Holliday,
treasurer, reported that the sale was wall-attended and considered highly successful.
Bob Rhodes handled the auctioneering.
pay $663 under Kennedy's plan I
a savings of $214 or 20.6 per cent
If llic same couple had been
taking itemized deductions of $t,
500, their tax bill under present
law would be only $720. It would
be cut to $5 under Kennedy's
plan, a savings of $124, or 17.2
per cent.
Persons Over 65 They now
get a double exemption $1,200 in
stead of $600. They also can claim
a special retirement income cred
it, t'nder Kennedy's plan they
would lose both these advantages.
Instead, each person 65 or older
would be permitted to deduct $300
from whatever taxes he may owe.
Result: No one over 65 with earn
ings of $2,900 or less ($5,800 in
the case of married couples)
would pay any taxes. This would
cost the Treasury $320 million in
annual revenue.
Authors, Athletes, Etc. Per
sons whose incomes fluctuate
sharply from year to year would
be permitted to average their in
comes with a resultant overall
TU 4-8111 No. 7046
Fiery Presentatioi
per cent, but that budget requests
were up only 29.6 per cent.
Rep. John D. Mosscr, R-Bea
verton. asked "who are we pro
viding education for? and asked
the board to prepare a census of
each institution showing how
many out-of-state students are en
rolled
Chairman Tianicl A. Thiel, D-
Astoria, said the subcommittee
wants a lull study on out-of-state
enrollments. Sen. Allred H. Cor-
bctt, D-Portland, added 'We are
supporting education for groups
from IS or U stales.
Lieuallen told subcommittee
members the board Tuesday had
upped tuition foes for out-of-state(Committee farm property taxes
students, and planned a series of are oppressive. Committee mem-
$fi0 a year Increases in the fees bers said bills are being prepared
to bring the charges up to tliello try to do something about it.
Anti-Zoning Petition
Given To Planners
A petition with 2.394 signatures
protesting zoning was presented
to the county planning commis
sion by Taxpayers League mem
ber Odella Antley at Wednesday
night's public hearing on the sub
urban zoning proposal.
The meeting was the last of
lour held to gain testimony con
cerning the plan from the resi
dents of Ihe suburban area. Only
m persons attended the hearing, a
scant third of the number that
attended Ihe previous three hear
ings.
Only eight people testified Wed
nesday night and Ihey alt op
posed the suburban zoning pro
posal. The text of the league s petition
read, "We, the undersigned, do
cs)cctfully petition the Klamath
saving of $30 million.
Child Care A widowed mother
or father now gets a special $600
lax exemption to help offset cost
of child care. This would be
raised to $900 if there are two
children and to $1,000 for three
children or more. Child care al
lowances would not be liberalized
for families with two employable
parents. But the incou.? limit at
which the existing allowance is
curtailed for such couples would
bo raised to $7,000 from the pres
ent $4,500.
Capital Gains Profits from
sale of securities or other prop
erties held for sly months now
are taxed at a special low rate
that ranges from 10 to 25 per
cent, depending on the individual's
tax bracket. The new range would
be 4.2 to 19.5 per cent. However,
only assets held for at least one
year would qualify for lower-than-
ordinary tax rates. Kennedy said
this would confine benefits to In
vestors rather than short-term
speculators.
Weather
Klamath Fall9, Tulelake and
Lakevlew Mostly fair with some
high cloudiness on Friday. Con
tinued mild. Lows tonight 8 In
Lower Klamath Basin tp 14 in
Klamath Falls. Highs Friday nenr
45. Light variable winds.
actual cost of instruction.
Further orientation discussions
will be held at the subcommit
tee's next meeting, then detailed
studies of budget requests will be
gin.
Other Highlights
Veterans Sen. Vernon Cook,
D-Gresham, chairman of the Sen
ate Committee on Military Affairs,
announced activities of the De
partment of Veterans Affairs will
be reviewed Jan. 29. Also facing
review are the state's military de-
I par tment, and civil defense agcn-
Icy.
Property Taxes A Corvallis
professor told the House Tax
County Court first, to drop the
plan lor zoning of private prop
erty by the County Zoning and
Planning Commission fsic) or
Second, to drop the plans until
submitted to the voters at the
next election."
The Klamath County Planning
Commission will have 30 days
to present its recommendation to
the county court. The court will
make its decision partially on the
basis of the commsision's recom
mendation and on the basis of the
testimony that has been presented
at the last four public hearings.
It is speculated in most quar
ters that the residents of the sub
urban area alone will get an
opportunity to vote on the propos
al either at a special election or
at the next general election.