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Seventy-Sixth Year
EDITED AND MANAGED BY STUDENTS OF THE UNIVERSITY OF MICHIGAN
UNDER AUTHORiTY OF BOARD IN CONTROL OF STUDENT PUBLICATIONS
U.S. Economy: Combating Inflation
-
ere Opinions Are Free, 420 MAYNARD ST., ANN ARBOR, MICH.
Truth Will Preval
NEws PHONE: 764-0552
Editorials printed in The Michigan Daily express the individual opinions of staff writers
or the editors. This must be noted in all reprints.
TUESDAY, MARCH'21, 1967
NIGHT EDITOR: NEAL BRUSS
Endorsements
For SGC Seats,..
IN A FIELD OF 17 candidates for six
Student Government Council seats
in tomorrow's election, The Daily Sen-
ior Editors have found a wide diverg-
ence of views appealing to various fac-
ets of the student spectrum. In gener-
al, fthe candidates are disappointing.
They lack fresh approaches or new in-
sights into the problems plaguing the
campus. They also demonstrated a faith
in methods that have failed continu-
ously in the past ("petitioning for a
student bookstore," "detailed resolu-
tions on student housing," etc.).
The following, listed alphabetically
within categories of preference, are
our endorsement for the six SGC
seats:
EXCELLENT
MARTI LIEBERMAN, '69 - Is the
most realistic of the candidates in his
appraisal of the University's opera-
tion and the measures students must
initiate to change undesirable condi-
tions. He would lend SGC a valuable
voice that could steer it on a path of
action.
ANNE PATTON, '68 - Is extremely
knowledgeable about the University
and demonstrates an enthusiasm for
Council work. She has sharp insight in-
to the decision-making process and is
likely to use realistic measures if stu-
dent demands are thwarted.
GEORGE STEER, '69--Will be a nec-
essary ingredient on the new Council if
significant advances are to be made
in the area of improved student hous-
ing. Aware of University affairs in gen-
eral, he is now vice-president of the
Student Housing Association and in
this capacity has initiated many fresh
Ideas in the area of low-cost housing.
He is presently working on a bill in the
state Legislature to attack the prob-
lems of-public housing.
GOOD
DAVID BULLARD, '68 - Presents a
detailed and fairly cogent list of im-
provements in specific areas of stu-
dent concern. He seems to have a good
understanding of the University and
would be a valuable worker for SGC.
STEVEN LESTER, '69E-Is the most
qualified candidate from the Engineer-
ing College and has an adequate un-
derstanding of the University. He has
a strong sympathy for expanding the
power base of students at the Uni-
versity, and is a necessary addition to
the new Council if all campus elements
are to be ably represented.
JANIS SORKIN, '68-Shows a keen
interest in an area of student concern
long-overlooked: transportation and
parking facilities. Moreover, she has a
good understanding of the Univer-
sity and does not seem reluctant to
consider necessary means of action.
WE DO NOT FEEL the other candi-
dates would be acceptable on Coun-
cil at this time because of their lack
of understanding of University affairs
and their unimaginative or unrealistic
platforms.
KAY STANSBURY, '70 - Demon-
strates much enthusiasm and sympa-
thy with Council's problems, but, since
she is only a freshman, we feel she is
still too inexperienced. We encourage
her to certainly seek election next year.
JEFFREY HOWARD, '68 -- Presents
a well-structured platform, but seems
confused about certain important areas
presented.
MARK SCHREIBER, '69--Also pre-
sents a detailed list of reforms, but
views the role of SGC as "most effec-
tive if it takes an advisory, if not con-
sultory role" in University affairs. We
strongly feel that this could seriously
hinder any improvement of Council's
position in the future.
JUDY GREENBERG, '68-Is very in-
telligent and :articulate, but is naive
about the-power structure and reflects
a basic unwillingness to consider meth-
ods necessary to an alteration in the
status quo. She is therefore not likely
to bring any fresh outlook to SGC.
BLANCHE GEMROSE, '68 - Though
interested in campus work, she lacks
an understanding about the power
structure of the University and the
workings of SGC.
RICHARD HEIDEMAN, '69-Worked
on the Residential College Advisory
Committee, but does not have a wider
awareness about the workings of the
University, and he is thus unequipped
for effective Council work.
E. O. KNOWLES, '70-Is an enthus-
iastic freshman who does not have an
adequate understanding of SGC and
University problems. However, he
should stay involved with Council work
and gain some experience.
MIKE McDERMOTT, '69 -Comes
across well on the surface, but his in-
sight into the decision-making process
is negligible, and he would not offer
Council any needed contribution.
MICHAEL ANDERSON, '69; JIM
SPALDING, '69, and GENE DE FOUW,
'69E-Are very poorly informed about
the University and have negligible in-
sights into solutions to student prob-
lems.
--THE ACTING SENIOR EDITORS
The following is the first of
four articles by two authors
dealing with the state of the
U.S. economy. This is the first
of two articles by Prof. Warren
L. Smith of Economics.
T THE PRESENT time there is
considerable uncertainty about
the exact course of the economy
during the next few months. There
can be no doubt that the pace
of economic expansion has slowed
quite markedly in recent weeks;
the question is whether a reces-
sion is in the offing. The sig-
nals at the moment are mixed,
as are the opinions of observers.
One view is that we are experienc-
ing a temporary slowdown in eco-
nomic growth to be followed short-
ly by a reneway of vigorous ex-
pansion; at the other extreme are
a few economists who believe a
recession has already begun.
Any assessment of the current
state of the U.S. economy and of
the problems it faces must be made
against thebackdrop of economic
developments over the past six
years. In almost every respect, the
performance of, the economy dur-
ing this period has been spectacu-
lar. GNP valued at constant prices
of 1958 increased from $483 bil-
lion in the. first quarter of 1961
(the trough of the recession of
1960-61) to $657 billion in the first
quarter of 1966-for an average
rate of growth of 5% per cent
per year. The expansion has con-
tinued for 73 months-the longest
peacetime period of uninterrupt-
ed growth in then ation's history.
Economic growth created 10 mil-
lion new civilian jobs between
February, 1961, and December,
1966-enough to absorb an in-
crease of 7 million in the civilian
labor force while at the same
time cutting unemployment from
5.7 million to 2.7 million. The
unemployment rate was reduced
"In late 1965 and early 1966 many e conomists outside the government fa-
vored a general tax increase to dampen inflationary pressures . . . (but)
no significant tax increase was proposed; indeed fiscal policy was mark-
edly expansionary as military expenditures increased much more rapidly
than had been projected in the annu al budget presented at the beginning
of the year.
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from 6.8 per cent of the civilian
labor force in early 1961 to 3.7
per cent at the beginning'of 1967.
During the first four years of
the expansion, prices were grat-
ifyingly stable. In February, 1965,
the wholesale price index which
measures price movements of bas-
ic commodities, stood at almost
exactly the same level as in Feb-
ruary, 1961. During the same per-
iod, the consumer price index,
measuring changes in the cost of
The difficulty of adjusting sup-
ply to rapidly growing demand
led to a greater rise in prices than
would have occurred had growth
been less rapid. The rapid growth
paid handsome dividends in re-
ducing the unemployment rate
from 4.7 per cent in June, 1965,
to 3.7 per cent in February, 1966,
but the cost of this achievement
in terms of inflation seems exces-
sive.
In late 1965 and early 1966
ingly rapid increase in the sup-'
ply of money and bank credit
that had been allowed to occur
in 1965 was brought to a halt,
and by the fall of 1966 many in-
terest rates had risen to their
highest levels in 40 years.
Although the tightening of cred-
it imposed severe strains on the
financial structure, it did succeed
in slowing the pace of expansion.
The growth of aggregate demand
was brought into line with the
clined by 46 per cent from March
to October, and the drop of nearly
$7 billion in the annual rate of
spending on house construction
between the first and fourth quar-
ters of 1966 was an important fac-
tor in cooling an overheated econ-
omy. Highi nterest rates, together
with last fall's suspension of the
7-per cent investment tax credit,
have undoubtedly also been an im-
portant factor in slowing the
growth of business spending on
new plant and equipment.
IN RECENT months, as infla-
tionaryEpressures have lessened,
the Federal Reserve has shifted
toward a moderately easier mone-
tary policy, and interest rates
have fallen significantly below the
peaks of last fall. The Economic
Report of the President, publish-
ed in January, forecast continued
expansion in 1967, powered by ris-
ing government expenditures com-
bined with a somewhat reduced
growth of private demand duirng
the first half of the year. By
midyear, the report predicted that
private demand would be expand-
ing more rapidly and would be
stimulated further by the Presi-
dent's proposed increase in Social
Security benefits to become effec-
tive July 1.
ON THE BASIS of such a fore-
cast, the President has proposed
the enactment of a 6 per cent
surcharge on personal and corpor-
ate income tax liabilities to take
effect at midyear in order to fore-
stall a renewal of inflationary
strains. If the measures proposed
by the President were adopted, the
economic report foresaw an ad-
vance of about $47 billion in GNP
in 1167 - a pace of expansion
judged sufficient to hold the un-
employment rate approximately
constant.
living, rose at a rate of only about
1 per cent per year.
EARLY IN 1965, however, the
stability of prices began to give
way to a steady increase. The rise
was bentle at first but became
much more perceptible as the
months passed. From August, 1965,
to August, 1966, the wholesale
price index increased by 3.8 per
cent while the consumer price in-
dex rose by 3.5 per cent.
In part, this inflation can be
attributed to the excessively rap-
id pace of the expansion in late
1965 and early 1966. Between the
second quarter of 1965 and the
first quarter of 1966, GNP rose
at an annual rate of nearly 10 per
cent; about 75 per cent of this rise
was reflected in increased output
and the remaining 25 per cent in
a price increase.
many economists outside the gov-
ernment favored a general tax in-
crease to dampen inflationary
pressures, and it is quite apparent
that this view was shared by some
economists within the adminis-
tration. But while steps were tak-
en to speed up the collection of
existing taxes, no significant tax
increase was proposed; indeed
fiscal policy was markedly ex-
pansionary as military expendi-
tures increased much more rapid-
ly than had been projected in the
annual budget presented at the
beginning of the year.
AS A RESULT, the burden of
checking inflation was borne pri-
marily by monetary policy. Begin-
ning with an increase in the dis-
count rate in December, 1965, the
Federal Reserve shifted to a mark-
edly restrictive policy. The alarm-
growth of productive capacity at
an unemployment rate that fluc-
tuated narrowly between 3.7 and
3.9 per cent during most of the
period from February, 1966, to
January, 1967. The wholesale price
index continued to rise through
August, then began to decline;
in December it was only 1.8 per
cent above the level of a year
earlier. However, consumer prices
continued to rise through the end
of the year, although they have
shown some signs of stabilizing
in recent weeks.
Tight money had its greatest
effect on housebuilding, as in-
creased security yields lessened the
ability of banks and savings and
loan, associations to compete for
deposits; thereby reducing the
supply of mortgage funds available
for the financing of house con-
struction. New housing starts de-
4
A
Letters: Reacting to Presidential Endorsements
To the Editor:
REGARDING your SGC presi-
dential endorsement (editorial,
March 19): SELLOUT!!!
-George Steinitz, '66
-Steve Daniels, '67
Pro-Kahn
To the Editor:
WE ENDORSE Bruce Kahn for
Student Government Council
president and Ruth Baumann for
executive vice-president. They are
unquestionably the most qualified
and able candidates who are run-
ning. Since both Bruce and Ruth
have been members of SGC- for
quite some time, they have an
understanding of the problems
which students here face and con-
crete proposals about how these
problems can be solved.
Kahn and Baumann are calling
for an end to the old concept of
a student government with insig-
nificant powers and resources.
They are working instead for full
and meaningful student partici-
pation within a new type of Uni-
versity government, They feel that
students must have the- power to
govern their own lives; that they
must bep rovided with complete
and accurate information about
the workings of the University;
and that they must have a ma-
jor voice in the entire University
decision-making process.
We support this concept of gov-
ernment and feel that Bruce Kahn
and Ruth Baumann will best be
able to achieve these mutually de-
sired ends.
-Nelson Lande
-John Preston
-Leslie Mahler
-Mike Koeneke
-James Benton
-Bob Smith
-Neill Hollenshead
Members of Student
Government Council
Endorsement
To the Editor:
W E ARE PLEASED that this
spring a particularly well-
qualified candidate is seeking a
seat on SGC. We feel Judy Green-
berg has worked conscientiously
in University affairs for the past
three years, having held positions
of leadership in many student or-
ganizations. These organizations,
which represent a broad range of
interests, reflect her great diversi-'
ty of abilities and extensive knowl-
edge of the University.
Her proposals for remedying the
chronic student housing problems
and her suggested innovations for
strengthening SGC's active role
in student affairs point up her
foresight and capibilities and she
would be an indispensable mem-
ber of the Council.
WE FEEL her distinguished
record ,is well evidenced not only,
by her scholarship (she is in the
Honors College), but also by her
membership on Mortar Board, the
national women's honor society.
We are confident that her elec-
tion would be a vote of support
for a responsible and outstanding
member of the student body.
stated "The engineer's knowledge
has been a barrier to solving world
problems." If that statement can
be interpreted as "The engineer's
lack of knowledge has been a bar-
rier to solving world problems,"
then I cannot complain but it
seems to be the first statement
implies that the engineer's techni-
cal knowledge is the barrier which
is not at all what I said or meant.
His next statement, "Cline said
that engineers were responsible
for all the developments," is an-
other misrepresentation. I said
that situation could be solved by
engineers and I said some of the
blame lies with managers, some
of whom are former engineers and
with graduates who join the large-
ly profit-oriented industries rath-
er than those organizations inter-
ested in problems of a social na-
ture. However, I did not put the
blame for "all the developments"
with the engineers.
The next statement attributed
to me was "A lack of student in-
terest in the social sciences and
humanities is responsible for the
engineering school's lack of a
strong liberal arts program."
I made no comments on student
interest in these areas although I
said more requirements in social
sciences would increase student
awareness of the problems. The
final statement about many engi-
neers trying to get out of "liter-
ary school" courses and few try-
ing to get into these courses was
not made by him but somewhat
resembles a remark made by Prof.
Eisley.
-Alan Kaylor Cline, '67
Vice-President
Engineering Council
P
I
\ f
* .' The next time you abbreviate 'Stop Our
Bombing' .. .Smile !"
-James P. Kleinberg, '67L
-Ward McAllister, '67E
--Steven P. Handler, '68
-Alison M. Smalley, '67N
-Walter Heiser, '68
-R. Michael Cole, '68L
Ministers
To the Editor:
MISS KILLIN'S proposal to end
draft deferfents for ministers
and theology students (March 14)
is outrageous. Ministers play as vi-
tal a role for the national security
as doctors, dentists or anybody
else. How do you propose to get
people to stand up and fight for
great righteous causes if you don't
first stiffen moral fibre?
I can only marvel at your stum-
bling so close to the answer in your
last paragraph, and then missing
the boat so completely.
-John Siegmund
Defending Statement
To the Editor:
WITH RESPECT to the article
Iby Dan Share appearing in
Tuesday's Daily, on the engineer-
ing symposium held the previous
day, I would like to clarify some
points. First, Mr. Share says I
"Fellow Members Of The Party In Power: Despite
Recent Reverses, Your Leader- "
f
-a
49'r
Focus on the Issues
ROLE of the president of Student
Government Council is hardly com-
plex. His function may be summed up in
one word: leadership.
The debate over the presidency of SGC
this year has not focused on this issue. It
has, instead, circled around problems that
are peripheral, if relevant, to the presi-
dency.
Supporters of Kahn say Copi is irre-
Vonsible. Supporters of Copi say Kahn's
platform is irrelevant. Both are right.
And, in somewhat the same way, both are
wrong.
nBoth groups are more concerned with
the inadequacies of the opposing candi-
dates than they are with the strengths
of their candidates as leaders.
KAHN HAS POINTS in his favor. He is
easy, perhaps too easy, to work with.
No Coinien
He is experienced in SGC procedure. But
his platform reveals a naivete about the
relationship between power and structure
in SGC that has not been affected by his
two terms on Council. There is no rea-
son to suppose that a term as president
will do him any more good.
Tom Copi may be irresponsible in one
sense of the word. His cynicism is a match
for Kahn's naivete. But Copi has one
thing in his favor that Kahn does not.
Copi will provide SGC with af ocus. The
proposals he advocates may never be car-
ried out . .. In fact, they probably won't.
But Copi will at least force Council to face
the issues. I can b'e sure he will never let
them forget what they're up against.
I DOUBT that Kahn will press Council
with the same zeal.
-JOHN GRAY
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Another View of the Heiart-wVoi1ce Incident
t Department
By PETER McDONOUGH
THE GRADUATE E x e c u t i v e
Council has delivered itself of
a pronouncement on free speech of
such weight, such high tone,
pickled in obiter dicta of such
eternity and verity, that one won-
ders what happened to the graven
tablets and seraphic trombones,
and suspects, a little nostalgical-
ly, that it reads better in the orig-
inal Latin:
"A graduate student is in train-
ing to become a member of the
community of scholars and one of
the hallmarks of that community
is free and objective discussion."
Unexceptionable, but for the
a - - -,, + -a- m ild.
ing in wisdom and age. The Board
of Regents added its blessing on
St. Patrick's Day, with indecent
sobriety. Lo, extremists of the
top and of the bottom are con-
founded and in rout. It's a rough
act to follow.
But perhaps this quibbly about
objectivity matters only to the
lunatic few. The real concern of
all this judiciousness is whether
the Voice-SDS group deprived
Messrs. Ford, Hart and Pollock and
their audience of their freedom
of speech by shouting. For their
side, SDS claims that Prof. Pol-
lock's ruling on the acceptability
of written questions, and verbal
~,,atnn 'fin -Ar fn r" nn-m_
The SDS crowd, on the other
hand, has little to recommend
them other than that they man-
aged, during this glut of edifica-
tion, to keep people awake. Mr.
Nadel, who corrected Mr. Ford's
sanguine memories about the fate
of dissenters in the thirties, is
unconsolably contrary. Mr. Zweig
has a Kropotkin beard too threat-
ening even for the hippest of
alumni publications. Mr. Rothber-
ger, a square radical, thinks the
workers are good although, or be-
cause, they are being had, and Mr.
Friedman, likewise, lives in a pop-
ulist delirium. Losers, the whole
hairy lot of them.
"iaA~a^'hfiir.- -milr.Avnr-
ing too controversial was suppos-
ed to be said, or that the audience
was not to be trusted, or both.
Both in fact were the case, and
so the inevitable happened.
Maybe, although they deny it,
the SDS incendiaries were bent on
disruption, whatever the form of
the questioning. A point in their
favor is that they waited until
after the morning session, when
the written questions they sub-
mitted were not made public, to
be inconvenient. Instead of going
the refusal - to - yield - to - threat
route, the chairman should have
anticipated their response, made
infamous by SNCC: "You must
think we're stunid to take such
sense of justice, indulges us with
benevolence.
THERE IS A STORY about the
Bengal famine of 1943 that fits the
occasion. After many entreaties,
the food minister was prevailed
upon to visit a particularly hard-
ait district, where he gave a
grandiloquent speech about pull-
ing together and making sacrifices
for the war against the Japanese.
The peasants listened for hours,
all agape. Finally, a local head-
man rose, thanked the minister
for blessing their wretched soil
with the tread of his foot, and
said:
"But there is one thing, sir:
*i
I E DINNER conversation hushed as
Ronald Reagan walked up to George
Iomney's table.
"Have a jellybean governor," said Rea-
gan to Romney.
"Thank you, governor," replied Rom-
ney. And with a flick of his left hand,
he popped a jellybean into the air and in-
to his mouth.
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