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December 04, 1960 - Image 1

Resource type:
The Michigan Daily, 1960-12-04

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inancial Experts

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The most significant aspect; of Michigan's financial crisis lies
neither in its complexity nor extensiveness, but rather in the fact
that its solution has been outlined so often.
Reiterating this conclusion is a 167 page volume, "Taxes and
Economic Growth in Michigan," released here yesterday by the
W. E. Upjohn Institute for Employment Research,
Although the work consists of nine separate articles, each
written by an out-of-state expert, and approaches the tax problem
from the specific standpoint of growth, the authors' conclusions
were consistent with- the results of the numerous previous studies,
Articles Agree
The collected articles, edited by former economic advisor to the
Eisenhower administration, Prof. Paul W. McCracken of the busi-
ness administration school, agreed that Michigan's indecisiveness is
its biggest tax problem.
"If a state has gained a reputation for mutdling through from
one fiscal crisis to the next, disregarding analyses made at its own
request and yielding to pressure groups . .. then the business firm
may be expected to count the tax climate as a negative factor in,
deciding on location or expansion, Prof. Carl S. Shoup of Columbia
University pointed out..
Michigan will need 900,000 new jobs by 1970 to attain reason-
ably lull employment, Prof. McCracken noted. This will necessitate
industrial growth to provide job increases at the rate of three per
cent per year, or twice the national average.

Next, Michigan' suffers from "constitution-itis," Prof. Mc.
Cracken Indicated.'
Long Constitution
The state's 1908 document is approximately four times the
length of the federal constitution and has been amended 67 times.
Fiscal legislation is "frozen" into the constitution. Thus, only
one-sixth of sales tax revenues end up in the state's general fund,
gasoline taxes are earmarked solely for highway construction, and
the state debt is limited to $250,000.
Although business taxes were considered by McCracken of
relatively little importance to an industry, panel members shared
the belief that Michigan business taxes are generally heavy.
Iri particular, the current corporation franchise tax of four
mills on capital and surplus was viewed with the least enthusiasm,
both in terms of its administration and in terms of its fairness on
different tryes of business. '
The Business Activities Tax which taxes companies on total
revenue received, also drew fire from the panel.
Tax Regressive
"A tax on gross receipts without any deductions is one of the
most vicious and regressive taxes there is," Loe Mattersdorf, a
senior partner of a New York accounting firm, said.
In urging the replacement of the activities tax, with one
measured by net income, Mattersdorf added that the present struc-
ture discourages investment in equipment and machinery and
places unfair burdens on an organization with a low profit margin.

The experts agreed that Michigan needs another broad-based
source of revenue to supplement the sales tax. They generally en-
dorsed moderately graduated personal income tax as a measure
wich would not only provide additional revenue, but would temper
the extreme regressiveness of the present system.
A "regressive tax" which places the greatest ,tax burden on
those most unable to pay was contrasted with the "more equitable
progressive tax" which uses "ability to pay" as its index.
Income Return
Although an individual with an annual income under $2,000
must spend 19 per cent for state and local taxes, he ultimately
receives 58.5 per cent for his income back in the form of benefits.
"The evidence pretty strongly indicates that when benefits
received and taxes paid are both taken into account, the state and
local fiscal structure in Michigan is already progressive," Prof.
McCracken noted.
All the panelists supported the voter's Nov. 8 decision to re-
move the three per cent sales tax limitation from the constitution.
Some of Prof. McCracken's "blue ribbon" panelists favored_ an
increase in the present rate, but recommended exemption of food
and drug purchases.
The most frequently made suggestion was to extend the tax
to cover services in addition to products.
A disproportionately large number of students taught in public
institutions has required Michigan to rank fifth among the states
in expendiures for higher education.

See Page 4


Seventy Years of Editorial Freedom

VOL. LXIM, No.62


Dispute Functions of Council

"The student is a unique part of
the University community and a
student governing body exists as
a body which is the organized
expression of the student's voice,"
John Feldkamp, '61, president of
the Student Government Council,
said yesterday.
Feldkamp spoke at the student
government discussion section of
the Student-Faculty-Administra-
tion Conference. The conference
was jointly sponsored by Student
Government Council and the
Michigan Union and was held at
the Union.
Feldkamp explained that all
functions of a student government

are derived from the basic fact
that it does exist as the organized
student voice.
Student Voice
"The governing body is the or-
ganized voice of student opinion in
all three of its functions-adminis-
tration of campus affairs, legis-
lation of expressions of student
opinion and leadership of the stu-
dent body," Feldkamp said.
President Clark Kerr of the
University of California has is-
sued a statement, labeled the
Kerr Directives," which says that
the student government at the
university may not take a position
on off-campus issues.

Alumni Relations Seminar
Debates Student Obligation
The problem of making the student aware of the University
Image and this responsibility to the educational system was dis-
cusped in the Alumni Relations seminar of the Student Faculty Ad-!
ministration Conference in the Union yesterday.
Chaired by Union Executive Vice-President John Ross, '61, the
seminar was divided on whether the University, with one-third of
its total budget of over $100 million supplied by the state should be
considered as a public or private institution. It was pointed out that
,much of the budget and the state

Commenting on this action Dan
Rosmergy, '61, said "I believe the
Kerr directives are a fine thing
and I think there ought to be a
'Hatcher directive' at the Univer-
sity which would put the Student
Government Council in its place.
"More important than the Coun-
cil's function as a group which
voices student opinion is its need
on campus as a body which co-
ordinates the various organizations
which are working on University
"While students should think
about other problems in their ex-
perience at the University, it
should not be a function of the
eighteen member Student Govern-
ment Council to seek to represent
and express this opinion to the
Seder Disagrees
James Seder, '61, disagreed with
this viewpoint and said a student
government has broader concerns
than its administrative function.
He listed those concerns as educa-
tion of the student body, intellec-
tual freedom and specific student
responsibilities. He said specific
student responsibilities included
peace, student movements all over
the world and discrimination.
"In considering these areas, SGC
has the responsibility to lead cam-
See SGC, Page 2
Soviet Base
E es China
LONDON am? - Russia is build-
ing a missile base commanding+
targets in Communist China, the
London Sunday Times said yester-
The paper said in a Tokyo dis-
patch from Far East Correspon-
dent Richard Hughes the base was
going up on the Kamchatka Pen-1
insula in North East Siberia.
It will equipped with missiles
capable of striking at targets 3,0004
miles away, Hughes said.
Hughes claimed aerial photo-
graphic evidence of the project
was in possession of Japanese in-
telligence authorities. He said the1
project was known as "K-1" and
differed sharply from the known
pattern of other Soviet missile
bases in Siberia in its site, range
and command of Chinese targets.

By Odiorne
A student who is applying for
a job through a company recruiter
has to be able to select the com-
pany which best suits him and
whose requirements he best fills.
To aid the student in his choice,
companies publish brochures des-
cribing their organization. Inter-
views function in a similar way.
However, besides telling the stu-
dent about the company, they
give the recruiter a chance to
find out about the student.
Interviews as they stand now are
too short for effective judging of
the quality of the students, Prof.
George Odiorne of the business
administration school and one of
the authors of a report on re-
cruiting for industry at the Uni-
versity said.
Interview Insufficient
He said that in a 30 minute in-
terview, the recruiter does not get
to know the student. There is no
personal interest involved. The
student becomes "a collection of
attributes to the recruiter and the
recruiter becomes a method for
getting a job."
The most effective part of the
interview, the personal factor, is
lost, Odiorne said. He recommend-
ed a one hour interview.
Since the interview is short, the
student must be able to impress
the recruiter if he is to get the
job. He has to know what the
interviewer is looking for.
Students Improve
Most students, Odiorne said, do
not do as well in their first or
second interview. With each suc-
cessive interview, students learn
the correct answers.
Because of this, most students
should count on a large number
of interviews, he said. Students
should not concentrate on one
Recruiters look for mature
people. Seventy four of 93 inter-
viewers questioned rated social
maturity as very important while
only two said it was of low im-
Ambition Important
The level of ambition of the
student was rated very important
by 85 of the interviewers while
none thought it was of low im-i
The least important things in;
these recruiters minds were mari-

Red Summit
Agrees War
WARSAW (M---Wladysla* Go-
mulka said yesterday the world's
top Communist leaders unani-
mously agreed 'at their Moscow
summit conference that "in our
epoch world war has ceased to
be an inevitable phenomenon."Th oihCmuitcif
who returned from the top-secret
conference Thursday, said the
participants signed two docu-
ments confirming the correctness
of Soviet Premier' Nikita S.
Khrushchev's peaceful coexistence
Gomulka spoke at a miners'
celebration in Katowice.
Indicates Win
His stateenrts indicated
Khrushchev had won at the three-
w&eek parley over a reported co-
existence and insisted capitalism
will only be destroyed by war..
Gomulka said the conference
1was devoted to an analysis of the
international situation. He said
the 81 delegations unanimously
adopted the two documents, which
he described as a statement and
an appeal to the, nations Involved.
Peaceful Competition
"The Communist and workers
parties of the world adhere to the
principle that the fight between
socialism and capitalism, between
the new and the old world, can
and should be decided not by
means of a new world war but by
means of peaceful competition be-
tween both social systems," Go-
mulka said.
Red China's President lu
Shao-Chi said yesterday Soviet-
Chinese Communist friendship,;
"steeled and tested" for 40 years
--is a cornerstone of the world
Socialist (Communist) move-
The Chinese leader made these
remarks, carried in a dispatch of
the Soviet news agency Tlass, on
his arrival by train in Leningrad.

As Conu

Debate Role
For PreSs
The responsibility of a campus
newspaper and its staff formed the{
basis for discussion of the studentj
press workshop of the Student'
Faculty Administration Confer-
ence yesterday.
The major focal point of the
discussion was whether a college
newspaper should reflect campus
concern as it really exists or as it
ought to exist.
Daily Editor Thomas Hayden,
'81, felt that a newspaper editor
has an obligation to determine
what ought, to be of main con-
cern to the university community.
No Obligation
Hayden added that a college
newspaper is not obligated to re-
present its campus in the same
way a legislature is obligated to
represent its constituents.
Prof. Palmer Throop of the his-
tory department pointed out that
regardless of a newspaper's at-
titude toward representing its
campus, the public generally con-
siders the paper more or less an
official mirror of the college.
No Censorship
"If the editor makes a major
mistake we should have his head
- See STUDENT, Page 2 ..
Yugoslav Aide
Woos Vatcan
ROME () - Yugoslav Minister
-Roca Popovic said last night Presi-
dent Marshall Tito's Communist
government would like to resume
diplomatic relations with the'
Vatican and West Germany.
Yugoslavia also wants to im-

actually supplies much more of
the money needed to operate each
year than the basic figures indi-
Dean of State-Wide Education
Harold M. Dorr said we are a
great state University with the
threefold but interrelated func-
tion of teaching, research and
service. The problem of a Univer-
sity is to maintain the balance
of these three in reality and also
in the public image of the Uni-
versity, which may or may not
be reality, he said.
It was suggested that the serv-
ice and education function be
stressed to the Legislature, the
education to the public and the
research to corporations for best
results in fulfilling the budget.
No matter what the University's
image, it was decided that the
educated person has a responsibil-
ity to the educational system
which should be manifested in
willingness to help the University.
The lack of this spirit was attri-
buted to the student tendency to
consider himself not a part of the
University but a helpless victim
of it.
Betsy Carroll, '62, suggested that
student' organizations and the
faculty stress the student's active
role in and understanding of the
University to the point that stu-
dents be asked to attend lectures
stressing their responsibility to
and the image of the University.
Paul Carder, '62, pointed out
that the Student Relations Board
(the student adjunct of the De-
velopment Council) and the board
of student governors (the student
adjunct of the Alumni Associa-
tion) were working directly in
the area of making the role of
an alumni real to the student.
The S.R.B. had found that first
they must make him relate to the
University and expand the per-
sonal view to an understanding
of toie whole aims of a higher

"good defense" as the reason for
the improvement over Friday's
opening encounter. "The defense-
men played a good game and the
forwards came back up ice fast to
help out," Renfrew said.
Friday night the Wolverines had
trouble clearing the puck from
their own zone, but they experi-
enced no such trouble last night
and were able to keep pressure on
the Toronto goalie for minutes at
a time.
Strategy Change
. Renfrew changed his strategy
Just before the game when he put
'erenson's line opposite the line
of Ev Rush, Don Fleming and Bill
--is a cornerstone of the world
Sncialist (Communist) move-
A participant in the Commu-
nist summit conference, Liu ex-
pressed belief that his visit to the

. ,. first varsity game
Soviet Union "will undoubtedly
contribute to further strengthen-
ing and development of the soli-
darity and friendship between our
two countries."
Kennedy which had scored three
of Toronto's goals Friday night.
The move payed off with Beren-,
son, Hinnegan and Larry Bab-
cock outscoring their counterparts
The first period was fast and
furious with Michigan applying

dent-elect John F. Kennedy
terday tapped North Carolina
Luther H. Hodges, one-time
tile industrialist, to be his S
tary of Commerce.
Hodges, standing by Kenne
s id e for, the announcem
promptly expressed concern a
the economy of the United SI
under the outgoing Republi
He promised to make the C
merce Department a vital, c
lenging force for the nation.
Second Selection
Kennedy, announced Hoi
appointment to some 50 repo:
and cameramen crowded on
flagstone patio at his fam
ocean-front home here. It
the President-elect's second 4
inet selection. Thursday he na
Gov. Abraham Ribicoff of C
necticut to be Secretary
Health, Education and Welfa
Kennedy said the 62-year
Hodges, a Democrat, "will i
to his new position experienc
both business and governmen
Announcement Late
Hodges, whose appointment
nouncement was an hour late
cause of the delay of his overr
train from North Carolina,
newsmen he is concerned
the economic position of the t
ed States is "not at the top.'?'
was in reply to a query on wb
er he thought the nation wa
the edge of an economic re
He declared the economy n
a new stimulation, "which I 1
we can get beginning Jan. 20
a rebirth ofconfidence."
Kennedy headquarters repoe
last night that the next Cab
announcement will be made W
nesday when the Senator wil
in New York City, A spokes:
said - the appointment would
be Secretary of State.

Shows Head Count Problem

Bid for Outer Mongolia Seat
In UN Refused Consideration,
UNITED NATIONS (P - The Soviet Union failed last night to
get the Security Council to take up the 14-year-old United Nations
membership application of Communist Outer Mongolia.
The Soviets raised the issue at a meeting called to consider
Mauritania's 5-day-old application,
The Council rejected 7-4 the proposal to list the applications on
the agenda in that order, with only the Soviet Union, Poland, Ceylon
- and Tunisia voting for. Then, in

"The University has the equi-
valent of 70,000 heads," Regent
Irene Murphy said yesterday to
the Student - Faculty - Adminis-
tration Conference.
For the group assembled for the
conference, jointly sponsored by
the Michigan Union and Student
Government Council, Regent Mur-
phy used a many-headed man to
illustrate the problems involved in
the head count of all students de-
sired by the Legislature.
Regent Murphy pointed out that
it costs twice as much to educate
upperclassmen as underclassmen.

Cuban Exiles
Plan Invasion
MIAMI (M)-A newly-organized
coalition of Cuban exile groups
last night announced plans to
wage a shooting war against the
Fidel Castro regime.
The coalition, called the United
Front of National Liberation, said
it opposes plans to send Cuban

a separate decision on a United
States motion, the Council voted
9-2 to list Mauritania's application
on the agenda and 5-4 against list-
ing Outer Mongolia's.-
Before the voting, Soviet Deputy
Foreign Minister Valerian A.
Zorin hinted that he would veto
Mauritania's bid for membership
unless Outer Mongolia's was ap-
He accused the Council majority
of. "an old policy of discrimina-

Unit TO St
Federal Ai1
A national advisory
of college administrator
ed this week to study
of federal funds in high
tion will be headed by
Ivey, consultant to the
of Michigan State Unix
The 11-member grout
ed by United States Co
-er of Education Lawrenc
thick will work with ti
of Federal Programs i

... Y 5 / J
:.:,., . ..r ". J"J f. s $tY is '' rrrd .
Jr III i SIR Agi

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