Surday, January 19, 1969
THE MICHIGAN DAILY
J m alm
1, 3,5, 7, 9 P.M.
DEFENSE COSTS DROP
Report warns recession possible
An unsurpassed cast!
ORSON WELLES LILLI PALMER
by The Associated Press and College Press Service
OEDIPUS THE KING
A Crossroads Film Production/Universal Pictures Production
A UNIVERSAL RELEASE TECHNICOI OR
By SPENCER DAVIS
Associated Press Writer
WASHINGTON 0P) - A Cab-
inet-level report to President
Johnson warns that the United
States faces a possible recession
when the Vietnam war ends and
urges that the government be
ready with an action plan to stop
The report, sent to Congress
last week by the President, said
the economy would be subjected
to the same deflationary pres-
sures that followedthe K o r e a n
While not predicting any date
for an end to hostilitiesin Viet-
nam, the committee of top White
House advisers based estimates
on an assumption that the transi-
tion to peace could be essentially
completed by July 1, 1971 - in
other words, the start of the 1972
The report said that if the cur-
rent 10 per cent income surtax
is still in effect when the fighting
ends, earlier phase-out of the tax
could help offset any recession
and promote healthy economic
It also urged that a detailed
plan to speed up government
spending on high priority pro-
jects be prepared now to cushion
the impact of the transition from
a war to peace economy.
The report of the Cabinet com-
mittee, under preparation since
IMarch, 1967, carried the signa-
tures of Defense "Secretary Clark
Clifford, Treasury Secretary Jos-
eph Barr, Commerce Secretary C.
R. Smith, Labor Secretary Wil-
alrd Wirtz, Budget Director Char-
les J. Zwick and Chairman Ar-
thur M. Okun of the President's
Council of Economic Advisers.
economy will be generating
Anticipating that the U. S. econ-
Saturday and Sunday
0' ITHE ELIPSE
Directed by Michelango Antonioni (BLOW-UP, RED
DESERT, LA NOTTE, L'AVVENTURA), 1961.
The third essay in Antonioni's trilogy about the na-)
ture and possibility of love in our time. )
"There's no need to know each other to love. Perhapsf
there's no need to love?"-Monica Vitti (heroine
~:00 & 9:05 7 ARCH ITECTURE
662-8871 73C AUDITORIUM
Detecive It. rank
other kind of cop.
1:00 - 3:00- 5:00 - 7:10
omy will be generating more than
$1 trillion by 1972, the report said
the cost of the Vietnam War has
been a load for the U. S. economy
to carry, and not a prop support-
"Prosperity has not depended
on the defense build-up and will
not speed high military spending
to support it in peace time," the
The amount available for fed-
eral "peace and growth" spending
would amount to $22 billion by
fiscal 1972 and would increase at
the rate of $7 billion to $8 bil-
lion a year thereafter, once peace
is restored, it estimated.
The report warned that p e a c e
could come in a number of
ways. Hostilities might decline
gradually, requiring reduced ex-
penditures, or there could be a
lengthy armed truce which would
aot permit a significant reduction
of U. S. forces in Sou t heast
But on its assumption that with-
in six months after a truce there
would be a genuine assurance of
peace and the beginning of a full
withdrawal of U.S. troops, the re-
port gave the following estimates
for a rapid demobilization:
The U. S. armed services would
decline by 800,000 persons, aver-
aging 200,000 a quarter, starting
in the third quarter after t h e
- Civilian personnel in the De-
fense Department would be re-
duced by 170,000 during that same
- As a result of manpower re-
duction, military and civilian
compensation would be reduced
by $7sbillion by the end of 18
- Other operating expenditures
would drop by $4 billion over a
slightly longer period.
- Expenditures for procure-
ment would be reduced by $8 bil-
lion over an interval of 30 months.
The report thus estimated that
defense spending would be re-
duced $8 billion by the end of 12
months, $16 billion by the end of
18 months, and $19 billion at the
end of 30 months.
The United States now is spend-
ing $80 billion for defense. If war
continued it was estimated that
defense purchases would r e a c h
$86 billion after 18 months, and
$90 billion after 30 months.
But if a genuine peace is reach-
ed, the report estimated that de-
fense purchases could be reduc-
ed to $73 billion by fiscal 1972.
Among suggested new programs
the report recommended a nega-
tive income tax, which is said
could make major inroads on pov-
erty while preserving work incen-
tives, at a cost of $15 billion to
$20 billion a year. It would still
need to be reinforced by housing,
health, education and job train-
VATICAN CITY (R)-Vatican
Radio declared yesterday that
Roman Catholic priests who op-
pose Church authority could find
themselves opposing God's plans
and losing their right to salva-
The warning was in a commen-
tary on the action by French rebel
priests who denounced last week
what they described as stifling
bureaucratic and power structures
in the Church.
The radio praised those priests
who try to modernize the Church
in cooperation with ecclesiastical
Opposition, however, "could de-
part from the historic plan of
salvation conceived and put in
motion by divine wisdom and
providence," it added.r
tees yesterday, claiming it
has discovered a subversive
conspiracy against the government.
Declaring a state of seige, President Rene Barrientos or-
dered"the arrest of prominent journalists, and opposition po-
litical leaders, mostly among the previous ruling Nationalist
Revolutionary Movement. The government hinted it would
not respect immunity claimed by Parliament, the universities
or trade unions.
In a radio message to the country, Interior Minister Da-
vid Fernandez said "reactionary elements" and "pro-Castroite
groups," were responsible for the plot, which allegedly involv-
ed terrorism and agitation in the cities and the countryside.
Some sources, however, said the government measures
were mainly precautionary steps to control social unrest in
two provinces, rather than moves against the real danger of
an organized plot.
ISRAEL WARNED yesterday it might send troops into
Jordan if terrorists continue to launch border raids from
And Foreign Minister Abba Eban denounced as a waste of
time France's proposal for a Big Four conference aimed at
settling the Middle East crisis. Eban said, the crisis can be
solved only by Israel and the Arab countries, not by "outside
powers who have at most only a marginal . . . interest in the
Eban also discounted a proposal by the United States for
Soviet-American talks on the problem, and a Russian pro-
posal calling for acceptance of a UN peace formula, Arab
recognition of Israel and Israeli withdrawal from Arab soil
occupied in the Six Day War.
WITHDRAWAL OF AMERICAN TROOPS from Viet-
nam this year is set for planning, President Nguyen Van
Thieu said yesterday.
Although Vietnamese and American military leaders have
agreed some combat troops can begin leaving later this year,
they still must draft a timetable. There was speculation that
a gradual pullback might start with 20,000 men, reaching
100,000 by the end of 1969.
Meanwhile, the four parties to the new Vietnamese talks
reached fullagreement in their first session on allprocedural
matters, clearing the way for discussion on a war settlement
itself early next week.
its . . .
STUDENT PROTESTS FLARED in West Berlin, India
and Japan yesterday.
In Japan, hundreds of students battled 8,500 police trying
to drive them from buildings they held at Tokyo University.
Police fought the students with tear gas fired from guns and
dropped from helicopters. Over 200 students were arrested,
but others still held a campus auditorium.
The trouble stemmed from protests last January by medi-
cal students, and subsequent disciplining of protesters.
In Berlin, hundreds of students swept through the-down-
town, smashing windows and stoning police on the fiftieth
anniversary of the murder of Karl Liebknecht and Rosa Lux-
embourg. Police posted 3,000 men, but confined their efforts to
keeping protesters on the move.
And in India, predominantly student mobs chased and
stoned Deputy Prime Minister Morarji Desai's car as he urged
people to vote for the ruling Congress party and keep Com-
munists out of power.
WRITER-IN-RESI DENCE PROGRAM
inml SUGGESTED FOR MATURE AUDIENCES TECHNICOLOR*v FROM WARNER BROS.-SEVEN ARTS W
Guild House, 802 Monroe
MONDAY, JAN. 20
I ; , oil 11
the Inlerdisciplinary Seminar
2 P.M.-Final Discussion-"Role of Minori-
ties in Political Structures in the U.S.A.
approx. 3:30-Booksigning at Centicore-
Beginning new series on:
"RELEVANT ISSUES OF THE DAY"
at Hillel (1420 Hill)
TUES., JAN. 21-NOON LUNCHEON
PROF. WILLIAM KRESSEY
Dept. of Romance Language
"THE LANGUAGE REQUIREMENTS AND POSSIBLE
CHANGES (series: academic reform at U of M) "
Sunday, January 19,
1229 South University
AMERICAN SUPPORT of its Asian allies' military
power must continue ,during the Nixon administration,
outgoing Defense Secretary Clark Clifford said yesterday.
In a final departmental report, Clifford said "some de-
gree of United States presence and commitment will be re-
quired" as a bulwark against Red China in the years ahead.
This includes "prudent use of the great military power at our
Richard Nixon has called in public statements for great-
er collective security efforts in Asia, rather than * unilateral
or major United States role in military on the continent.
Reception Following Lecture
- FEBRUARY 8
SATURDAY, JANUARY 18-4 P.M.
RABBI ERNST CONRAD,
New Temple, Birmingham, Mich.
"Archaelogy in the Middle East: The Origins of the Jewish People"
Havdalah service following
Available in the Fishbowl and C.A.F. Office, 3rd floor League
(saves $5.00; limited number available)
SUNDAY, JANUARY 19
Clive Barnes (Jan. 26)
Dionysus in '69 (Jan. 26 27)
Robin Kenyatta-African Contemp.
Music Ensemble (Jan. 30)
Morley Markson (Jan. 31)
The Believers (Feb. 1)
Dr. Spock (Feb. 2)
Second City (Feb. 3 )
John Perrault (Feb. 4)
Stanley KaufmautnnFeb. (5)
Marisol Feb. (6)
2:00 P.M.-JERZY KOSINSKI,
"The Role of Minorities in Political Structures in
Contemporary U.S.A. and Europe"
5:30 P.M.-DELI HOUSE
SPECIAL SEMINAR sponsored by the BET MIDRASH (College of Jewish Studies)
"Jewish Logic" --- Prof. Joseph Reif
Note: coming NEXT Sunday: Panel on the Rent Strike
with bagels and lox brunch