FULL-YEAR OPERATIONS AND BIG TEN SPORTS See Page 2 fEt itra Seventy-One Years of Editorial Freedom. A& 43atty, 40 POSSIBLE RAIN High-82 Low-55 Chance of showers today; cool weather tonight "VliY TT 1\Tr..rr T9- C - YL , ZaAXiN, No. 3-S ANN ARBOR, MICHIGAN, THURSDAY, AUGUST 9, 1962 SEVEN CENTS FOUR PAGES a'vvaa aCMXAAoa I Loza Leaves Post! In Army Uprising Five Argentine Generals Threaten Guido Government with Rebellion BUENOS AIRES (P)-Argentina's War Secretary resigned last night after an open rebellion of army chiefs threatened new difficul- ties for the shaky government of President Jose Maria Guido. Brig. Gen. Juan Bautista Loza told a group of high army officers his resignation from his dual post of secretary and army commander- in-chief was the only way to resolve the situation. The resignation climaxed a day of military upheaval which began when one ranking Viexo v Capital Eutlay Fiscal Upcoming Perry Rules SWAINSON, ROMNEY MEET: To Dismiss Candidates Begin First Bout JOSE GUIDO .. army threatens government KATONA: Cites Need Of. Tax Cut Prof. George Katona, director of the Survey Research Center's Economic Behavior Program, told the Joint Economic Committee of Congress that the recent specula- tion about a possible income tax cut may have made tax reduction a psychological necessity for the American consumer. Although erroneous notions still prevail about taxes and defense expenditures, the government has the additional task of informing and educating the public about the reasons for its action whether taxes are cut or not, Prof. Katona said. With reference to the regular national surveys of consumer at- titudes and willingness to buy which Prof. Katona's program conducts, he explained that the current "sober" mood of the Ame- rican consumer is based upon three persistent concerns: the re- currence of recessions; the rela- tively high level of unemploy- ment; and the cold war. Capable of Forestalling "The great majority of Ameri- cans have drawn the conclusion from the experiences of 1958 and 1960-61 that government and busi- ness are capable of forestalling a depression, but can do nothing to stop the recurrence of short and nevertheless painful recessions," he added. "Given this frame of mind,, people are sensitive to bad news. It may be that consumers will not contribute to a faster economic growth unless new sti- muli alter the prospects seen by them." In answer to the question, should taxes be reduced now, Prof. Katona said, "People feel uncer- tain and cautious because they are not aware of any factor that might be capable of stimulating the eco- nomy and reducing unemploy- ment. "We are not in a recession to- day, even though the extent of the recovery is far from satis- factory. According to available in- dications there will be no reces- sion in the consumer sector during the winter of 1962-63. New Consideration "But the last few weeks have brought forth a new considera- tion. Probably very many people have heard about the tax reduc- tion proposals. There is a risk that they would view a decision by Congress not to reduce taxes now as a disappointment. "A negative decision about the tax cut might then represent a new factor adding to pessimistic views and making the recurrence of a recession .more probable than it has been. What Congress does is important; how the people in- terpret what Congress does or doesn't do is likewise important." barmy leader, Maj. Gen. Federico Toranzo Montero, set up a rebel command post in Northern Argen- tina and called on Loza to quit, Branded an Outlaw Loza branded Toranzo Montero an outlaw, but within a few hours four generals had rallied to the rebel's side. The rebel leaders accused Loza, a career soldier, of wielding iron- fisted one-man rule over the army. The open strife in the military hierarchy caused consternation irt the Guido government, placed in power by the army last March af- ter a bloodless coup ousted Presi- dent Arturo Frondizi, still in cus- tody on an island in the river Plate. Military Very Powerful j Frondizi was deposed when the military became increasingly con- cerned that election victories by followers of ex-dictator Juan D. Peron would spark a Peronist re- surgence. Defense Minister Jose Luis Can- tilo was expected to take over Loza's job temporarily. But there were indications that the army commanders who forced Loza out would not accept Cantilo, even on a temporary basis. This would create new confusion. Guido was in constant confer- ence with his ministers and mili- tary chiefs, among them economy minister Alvaro Carlos Alsogaray, just returned from an aid-seeking mission to the United States. The army general insisted their quarrel was strictly over Loza's role as land forces representative in the Guido government and was not a political affair. Stock Market Panic But the open rebellion caused panic in the stock market and brought expressions of grave con- cern from Economy Minister Al- vard Alsogarary, who is struggling to win confidence abroad for his crisis-beset nation. The revolt followed days of spec- ulation that a long-smouldering feud within the army, Argentina's strongest military force, was ready to burst into the open. The army's internicine struggle did not bring any repercussions within the navy and air force, in- formed sources said. Navy Won't Help One admiral stated that the navy refrained from joining the army rebels but also rejected Loza's request for navy support to put down the revolt by force if necessary. The air force also refused a plea for help against the rebels. Toranzo Montero is a brother of Gen. Carlos Toranzo Montero, former army commander in chief who forced a reshuffle of the top military echelons in an uprising against Frondizi in 1960. Pass PlanI For UN Aid WASHINGTON (P)-The House Foreign Affairs Committee, after tying on a few strings, gave pre- liminary approval yesterday for President John F. Kennedy to lend the United Nations $100 million on easy terms. This modified version of a con- troversial measure that passed the Senate four months ago will be subject to a formal vote today, committee chairman Thomas E. Morgan (D-Pa) said yesterday. Kennedy asked for the author- ity to help the world organization out of a financial jam created by refusal of several members to pay special assessments for emergen- cy operations in the Congo and the Middle East. More than Others Morgan said paid up bond sub- scriptions so far from other Unit- ed Nations members total only $27.45 million. Kennedy first had requested au- thority to purchase half the $200- million issue of 25-year, two per cent United Nations bonds. The Senate Foreign Relations Commit- tee amended this to approve out- right purchase of $25 million in bonds and to match other nations' purchases up to $75 million more. Compromise Measure The compromise on a $100-mil- lion loan for 25 years at two per cent interest was substituted by the Senate before it passed the' measure 70 to 22. As approved by the Senate, the measure would forbid use of the funds loaned by the United States to relieve other nations from pay- ment of arrears on special levies for the Gaza Strip and Congo peace-making efforts. The Senate version also would permit the United States contri- bution to total up to $25 million more than the aggregate receiv- ed from other UN members. Committee May Survey Funds Use By The Associated Press. LANSING - Senator William Milliken (R-Traverse City) re- ports that his Special Senate Com- mittee is ready to start a survey of the state's government spend- ing to assure the taxbuyer that his money is being used to the maximum advantage. JOHN F. KENNEDY . . . aid bill approval Union Case Raiworkers Prepare For Possible Strike CHICAGO ()-A major two and one-half year railroad-labor strug- gle with vast implications for the nation's economy surged through a near-showdown court phase yes- terday. Five unions, representing 200,- 000 crewmen who run the trains, went to a Federal appeals court in a second try to block sweep- ing economy work rules which the railroads have adopted, effective Aug. 16-a week from today. Judge Joseph Perry dismissed the UnitedsStates district court suit by the unions asking a dec- latory judgment barring the rules changes. An emergency appeal was taken to the 7th United States Circuit Court of Appeals. 40,000 Lost Jobs The rules, first proposed by the carriers Nov. 2, 1959, could lop 40,000 firemen-those who work on switching and freight diesel locomotives-from the payrolls. They also include provisions to get more work out of train crews, pre- scribing longer runs for a day's work and generally eliminating overlapping of work assignments. Looming beyond the courtroom stage is the possibility of a na- tion-wide walkout of the workers -the firemen, trainmen, engi- neers, conductors and switchmen -if the railroads stick to their announced intention of tightening up work rules drastically. ' Such a strike will come auto- matically with the rules changes, the union leaders said yesterday after a conference in Washington. Instruct Strikers Members of the unions received their joint strike instructions sev- eral days ago, telling them "how to conduct themselves in the event a strike is forced upon them by the railroads," the labor leadersi said. But a stoppage earlier than mid- October appeared unlikely. With the sounding of a strike call-or, in its absence, the clear certainty of a walkout-President John F. Kennedy could invoke the Railway] Labor Act to cause postponement for 60 days. A White House spokesman said] the strike threat is "under con-3 stant observation" from there, al- though not officially. The Presi- dent's move would be naming of a fact-finding board to study the dispute and report to him its sub- stance within 60 days. Second Study Such a study would be the sec- ond by a presidential panel. A commission named by former Pres- ident Dwight D. Eisenhower short- ly before he left office made its recommendations for settlement Feb. 28.n The commission softened con-] siderably the carriers' expense- cuttnig plans, but agreed that 13,- 000 freight and yard firemen would have to go. The other 27,000 would not be replaced when they retire or die. The commission also recommend- ed a 2 per cent pay hike for about 75 per cent of the operating em-1 ployes. IONIA (A) - With ballots from the primary election barely count- ed, Gov. John B. Swainson and George Romney, his Republican opponent, met face-to-face yes- terday and engaged in some pre- liminary sparring in their battle for Michigan's top political prize. Romney, doffing his suit coat in the August heat, intimated in a talk to more than 500 Ionia Free Fairgoers that Swainson has done poorly in his first term as gover- nor. The Democratic governor paired briefly, saving his main ammuni- tion for a meeting of Ionia County Democrats. The Republican-con- trolled Legislature, he said, is re- sponsible for what he balled "the mess in Lansing." Nearly every big star of both major parties on the state level crowded into the Ionia High School gymnasium for the annual governor's day luncheon, mostly to compare notes on Tusday's elec- tion and talk about the big one Nov. 6. Shakes Voters' Hands Romney inched through the grandstand at the fair grounds, shaking hands with some of the crowd of 4,000, then took to the midway for more of the same. Swainson assisted by most of the top Democratic state officials, gave the crowd the same treat- ment. In his prepared speech, Romney told the bi-partisan gathering that the governor of Michigan ought to be "absolutely free from control or domination by any narrow in- terest or group of interests." It was an evident repeat of his con- tention that labor unions control Michigan's Democratic party. Conflict Normal "Some conflict is normal and even healthy in any society," he said, "but the governor must do everything he can to avoid an extreme depth of hostility between the governor and Legislature, be- tween labor and industry between urban and rural areas." Romney also cited "a conscien- tious and constant concern about the frugal use and management of the public funds" as a require- ment for a good chief executive. Swainson, though he trailed Romney in votes in the primary, took heart in the fact that he didn't garner as many votes as Paul D. Bagwell, the GOP guber- natorial candidate in 1958 and 1960, picked up two years ago. "It pays to be defeated," Bag- well joked. Approve Plan To Label Drugs WASHINGTON (P)-The Senate Judiciary Committee approved in modified form yesterday President John F. Kennedy's proposal on labeling of drugs. The action marked one more step in the committee's considera- tion of recommendations the Pres- ident made the first of this week for strengthening of a drug indus- try control bill. One of the recommendations was that the official name of a drug be printed on the label and that it be given precedence in position. FIRST BOUT-Governor John B. Swainson (left) and his prob- able Republican opposition in the state gubernatorial race, met yesterday in what promises to be the first of a series of public debates and discussions concerning the condition of the state. TAX CUT ISSUE: Kennedy To Await Data Before Offering Decision WASHINGTON (IP)-The White House said yesterday that Presi- dent John F. Kennedy is still waiting until all the economic data is in before deciding whether to seek a tax cut this year. The statement that "no decision has been made" came after Kennedy was said to have told a. meeting of labor union officials that he has given up any thought of asking Congress for an imme- diate reduction. The President was represented as having told the union leaders he shares their view< Plan Year 'U' Requests $12 llion For Building Funds Necessary For Additional Units On North Campus By DENISE WACKER At their July meeting, the Re- gents reviewed and gave their ap- proval to a preliminary report on the University's capital outlay budget for next year, John G. Mc- Kevitt, assistant to the vice-pres- ident for business and finance, said yesterday. All in all the construction and remodeling requests, which will be sent to various state agencies early in September, differ only slightly from the 1962-63 budget submit- ted last year. However, this year's request, to- talling nearly $13 million, is con- siderably smaller than the one a year ago. Of last year's requested appropriations - $17,841,000-the state Legislature granted only $3,- 800.000 for construction work dur- ing the fiscal year which ended last month. North Campus Construction The bulk of the proposed con- struction work would be done on North Campus, although the ma- jority of renovation or reconstruc- tion work listed would take place in older laboratories and plant buildings on the Central Campus. This year's priority list corres- ponds exactly to last year's - t top item is the partially-construct- ed Physics Astronomy Bldg., which has been under construction for the past year. $772,000 was, re- quested so that the work could be completed by next spring. The second item was again the music school building, which will incorporate into one structure the various units now sc at t ere d throughout the Central Campus area. Hydraulics Building After this, a new building to house researchers studying hy- draulic power is listed. It is the second such unit which will be built on North Campus. In 1956 the Legislature appropriated $20,- 000 for a study leading to the ac- tual planning of the strcture, completed a while ago. The second unit of the Medical Science Building follows as fourth of the priorities. Only $400,000 will be asked this year, but the to- tal expense of the project-in ex- cess of $10 million-is the most costly single item on the budgetary request. "It will join the first unit of the Medical Science Bldg. and would house various departments now lo- cated in the East Medical Bldg., as well as the human genetics section currently spread over various de- partments of the Medical Center. Switch Units East Medical would become available for use by other Central Campus units, and would be par- ticularly adapted for use by biolog- ical science units," McKevitt said. The second list of priority re- quests, which includes remodeling of present structures or the con- struction of annexes, lists first a request for $750,000 for improve- ments in the University heating plant. There is also a request for additional funds to improve lab- oratories in West Engineering to make easier instruction and re- search in the building. Priorities Change The list of priorities and the na- ture of each project are reviewed each year by administrators and Regents. Changes can and are made, since the prime objective to capital outlay is to keep it sensi- tive to change in needs and re- quirements, McKevitt added. The state provides about 47 per cent of the money for capital im- provements. The remainder is se- cured from the Federal govern- ment,, bond issues, and foundation or private gifts. that a prompt cut in income taxes would help stimulate the lagging economy, but feels Congress would turn a deaf ear. Instead of trying for a reduction now, Kennedy was reported to have said, he is going ahead with plans to seek a general revision of the tax laws next year, including a cut in. individual and corporation tax rates. Kennedy discussed a wide range of economic problems at a lunch- eon meeting with members of the 29-man AFL-CIO executive coun- cil, including AFL-CIO President George Meany. Meany has been] one of those advocating an im- mediate cut in rates for lower in- come bracket taxpayers as a means of stepping up consumer buying power. Commenting on these reports,; Asst. White House Press Secretary Andrew T. Hatcher told reporters the luncheon was "in the nature of a social meeting" and "I imag- ine a tax cut came in" during the conversation. Hatcher said he had checked specifically on whether Kennedy said he had abandoned the idea of an immediate tax cut. He re- minded reporters that the Presi- dent has said on several occasions that he would withhold a decision until all the July economic indi- cators were available. Meany said in advance of the luncheon that even though he still feels an immediate tax cut is necessary he would abide by the President's appraisal of Congres- sional prospects. [sion Bill Court Stalls on Decision In Anti-Segregation Case ALBANY -)-The Justice Department joined yesterday in a court fight against outlawing Negro demonstrations here shortly before a hearing was adjourned with no indication of when a decision would be rendered. United' States District Court Judge J. Robert Elliott adjourned shortly before 5 p.m. a seven-day hearing on the city's petition to permanently enjoin anti-segregation marches, boycotting, picketing and other protest activities. <> Notes Lag In 'Economy WASHINGTON (P-Walter W. Heller, chief economic adviser to President John F. Kennedy, said yesterday there is a possibility the recent slowdown in the economy "represents advance warning of an economic decline." In response to a question from a member of the Senate-House Economic Committee, Heller said the term "economic decline" was one way of defining a recession. While pointing out the possibil- ity of a recession, Heller said eco- nomic indicators are mixed. Short of Potential There certainly is no doubt, he said, that "the United States econ- omy is still operating considerably short of its potential." A few months ago Heller had predicted a strong, virtually unin- terrupted surge in the economy this year, with a gross national product of $570 billion. He told the committee it was obvious the GNP would not come close to his prediction. Heller, chairman of President John F. Kennedy's Council of Eco- nomic Advisers, underwent an aft- ernoon of questioning by the com- mittee without dropping any clues as to Kennedy's decision on a quick tax cut recommendation. Defends Kennedy He defended Kennedy when Sen. Jacob K. Javits (R-NY) accused the President of "agonizing inde- cisiveness." Heller said Kennedy's decision to recommend a net income tax cut across the board effective Jan. 1, 1963, regardless what may be done meanwhile, "shows a decisive- ness not seen in many years." Javits has said Congress should vote a $5.5 billion tax cut before it goes home this year. Reductions Desired Heller said the permanent re- duction advocated by the Presi- dent for next year could be spelled out in any of several ways, and added "what he is saying is he wantstto see reductions from top to bottom." "At this moment I'm not sure WORLD NEWS ROUNDUP: exactly when I will decide thisi case," said Elliott. "It might be within a couple of days or within a week or within a month." Attorneys for both sides de- Se nate Passes Veterans' Exten clined to offer closing arguments,' apparently hopeful of an early de- cision. But Elliott said the case would remain "in the breast of the court for a decision at such. time as I get to it." The judge said he was leaving the record open in order that both, n;,q --rl o~r~~lcmari thi ror d By The Associated Press WASHINGTON - The Senate passed arrd sent to the House yes- terday a bill to extend for a year the time in which veterans of World War II and Korea can ap- ply for government insurance. Sen. Germany Sept. 4-9. When plans of grace in England last night in} for the conference were announced a showdown with Israel on getting July 10, West German Chancellor him out of the country. Soblen's Konrad Adenauer asserted that lawyers expressed hope President the talks would strengthen the John F. Kennedy would grant him Franco-German "wall" against a pardon or amnesty. Soblen is Communism. under life sentence for spying for v * the Soviet Union. UNITED NATIONS - The* United Nations announced yester- DAMASCUS-An army spokes- day that acting Secretary-General man reported early yesterday a 11 T T 1a.-h A fr',v,,. i, !- _ + . . I,- sides could supplement the recorc Russel B. Long (D-La.) said vet- "if there should be any events erans, including some partially which develop between t hif s disabled, could get term insur- moment and when I announce my ance until age 50 and then con- decisionci io" t it into mnified life nnolies. I