DAY, 30 JANUARY 1965
THE MICHIGAN DAILY
...ms s"- >, ' S
'NCIES ASK $996.2 MILLION:
omney Discusses Budget'
SPECIALIZATION RAISES INCOME
Comparative Advantage Fathers Common
ING W)A - Gov. George[
said yesterday he'll de-
budget message Tuesday.
ate agencies want him to
396.2 million and that he's
to go" on tax reform.
overnor told his news con-
that the agency requests
e than $300 million high-
the state budget now in
1 the increases requested
;tate agencies were to be
i next fiscal year, it would
sary to boost general fund
i1 purpose spending by
cent," Romney declared.
med obvious his budget
ndations would consider-
ably pare down the agency re-
quests.
"We have taken a close look at
each request in preparing the
budget I will submit to the legis-
lature next Tuesday," the govern-
or commented.
"I am releasing this report at
this time to give advance notice of
the magnitude of the state ser-
vice requests we are dealing with
this year.
"It is clear that we must make
every effort to be efficient and
economical in what we do and es-
tablish priorities in meeting the
most essential requests for public
service improvements."
The governor again said he's
f --._.
IE MINISTER WILSON
PRESIDENT DE GAULLE
Ison, Statesmen Confer,
, Anglo-Frenbc Summit
1DON (/P) - Prime Minister Harold Wilson used the eve of
ston Churchill's funeral yesterday for a Wyhirlwind round of
th visiting statesmen. Associates said he wdn agreement from
it Charles deG ulle for a late-February or early-March two-
ummilt in Paris.
ach sources privately expressed belief that the talks had
the path to a betterment of relations between the two coun-
e way toward a better understanding was achieved," one
source said, "and the way to an easier future in relations was
by the talks." Both sides seemed satisfied and appear hopeful
i that French-British snags may be
i-ironed out. It will take a lot of
doing, however, for problems
orSd News which oppose them are both im-
portant and manifold.
ready to cooperate on tax reform
as soon as the legislature shows
support for the idea.
Referring to his failure to get
tax reform in a 1963 special legis-
lative session, Romney said:
"Putting up a program is not
the way to get at reform success-
fully. Last time I proposed spe-
cifics and the Democrats knocked
them down.
"If I put something up it would
get labeled as a Romney Repub-
lican program."
Future Program
The governor said he'll work
with legislative leadership to de-
velop a program whenthere are
indications it would succeed,
APPROPRIATION AGENCY
REQUEST
In In
Ml- Mil-
lions lions
1964-65 1965-66
General Government $ 21.7 $ 27.4
Education \ 147.6 213.9
Public Health 17.4 21.1
Mental Health 90.5 107.2
Public Welfare 99.3 103.7
Public Safety-Defense 28.7 32.4
Adult Corrections 19.1 19.8
Regulatory Services 119 14.7
Conservation, Recreation,
Agriculture 11.8 16.3
Debt Service-Transfers 33.4 29.8
Capital Outlay 57.4 165.8
School Aid Grants 155.1 244.1
General Fund Total 694.3 996.2
He said, however, that pre-legis-
lative session conferences indi-
cated that House and Senate lead-
ers were not sure the huge dele-
gation of new lelgislators wanted
to tackle tax reform yet.
Romney said he also had the
impression House Floor Leader J.
Bob Traxler, (D-Bay City), and
Senate Appropriations Chairman
GarlandLane, (D-Flint), were not
ready to get into reform.
Romney has said that the state
budget surplus will last only an-
other two years before more reve-
nie is needed.
But he emphasized yesterday1
that tax reform is not tied to a
deficit or surplus situation-
"We need tax reform because we
have injustices in the present sys-
stem."
He said reform did not directly
relate to revenue needed.
Thus, by tax reform the gov-I
ernor means the methods by
which taxes are raised, not the
specific rates applied to each of
these methods. The rates control
the revenue taken in by the state.
Nearly all reform proposals re-
volve around a personal income
tax and relief in property and
sales taxes.
Lansing Faces
L a s n a e Auto, Tax Bills
LANSING (P) - Organization,
orientation, the start of an ex-
pected bill avalanche and virtual-
ly no substantive final action
characterized this week in the
Legislature.
With committees just getting
organized and much office space
yet to be acquired or allocated,
the House and Senate were in
session for a total of only about
five hours this week this week.
Both chambers took today off.
Work is piling up for the com-
mittees, however, as the 78th bill.
of the new session was introduced
Thursday.' Major measures intro-
duced this week included another
version of senior citizen property
tax relief, two plans for manda-
tory vehicle inspection and a bill
that would in effect exempt Amish
schools from teacher certifica-
tion requirements.
Romney sent to the Legislature
Wednesday a comprehensive traf-
fic safety message calling for ve-
hicle inspection, 200 more state
troopers, implied consent of any
drivers to alcohol tests and a raft.
of other changes.
The week's other developments
included:
Democrat Claude Burton of Bel-1
levue was seatedu inthe House
in place of Republican Carroll
Newton of Charlotte, who lost
in a recount.
The Senate Business Committee
gave Lt. Gov. William Milliken a
tie-breaking vote in all cases.
1;
EDITOR'S NOTE: This is the first
of three articles surveying the
European EconomicsCommunity.
The series considers the reasons for
its founding, the factors which
combined to make it possible and
necessary, its relationship to other
nations of the world, and its pros-
pects as a political, economic, and
military unit in the world of to-
morrow.
By DICK WINGFIELD
For Europe, the spring of 1957
marked the culmination of cen-
turies of economic change. About
a thousand years before, a tribal
economy had unfolded to reveal
feudal states; eventually feudal-
ism gave way to disjointed nation
states; fairly recently the indus-
trial revolution ushered in the ad-
vent of unemployment, inflation,
depression, and balance-of-pay-
ment problems.
When the great depression
faded away, leaving in its wake
wasted resources, wasted time and
human labor, hunger and misery,
a whole new era of economic
thought was born to grapple with
the exigent economic problems.
Men whose work had been in-
strumental in giving birth to this
new economic philosophy were
David Ricardo, John Stuart Mill,
and other English followers of
Adam Smith. They fathomed the
full value of trade between na-
tions-a theory which we now call
comparative advantage.
Community Formed
After the war and the years of
reconstruction, several years of
mellowing and formulation, the
European Economic Community
was born in Rome, March 1957,
under the direction of Jean Mon-
net, upon the theory of compara-
tive advantage.
Basically, this meant that the
six countries joined in the Eco-
nomic Community believed they
could each specialize in producing
certain types of commodities, such
as grain or automobiles, but it
should be emphasized that the
production of certain commodities
is not left exclusively to one na-
tion.
E Comparative Advantage
With each country producing
that product for which it has the
greatest resources, most complete-,
ly developed technology, and
greatest labor pply-that is, a i
comparative a antage over other
countries-a greater national in-
come would be guaranteed to all
countries which could sell their
produce.
If it costs a country relatively
more labor, materials, and capital
to produce one item, wheat, for
instance-and relatively less la-
bor, materials, and capital to pro-:
duce another item-dishwashers,
in this case-then it would bene-
fit the country to solely produce
dishwashers-providing there is a
guaranteed market for dishwash-
ers.
Asses Produce
. When the chosen six united,
it was therefore necessary to as-
sess their respective capabilities.
The economic capacities of The
Netherlands seem to be concen-
trated in steel production and
shipbuilding. The land available
for agriculture is limited, and
there is a growing scarcity of la-
bor. As a result, industry is now
surpassing agriculture in the
number of workers and allocation
of capital and materials.
The change will enable the
Netherlands to maximize the out-
put of its limited supply of land,
and industrialization will enable
workers to produce more steel and
ships-thereby maximizing the
productivity of the labor supply.
In a similar manner, Belgium
has recognized carpet production
as one of her major roles in the
Market. Because of a labor short-
age, automatically-run spinners
in Belgian textile mills have been
utilized in greater numbers. It is
significant, however, that the
European carpet market would
probably be insufficient to sus-
tain Belgian producs.
It was for this reason that Bel-
DIXIELAND
in the "Kennedy Rounds," aimed'
at lowering the tariffs between
europe and the U.S.
Belgium's steel production, how-
ever, exceeds its carpet produc-
tion. The major consideration is
that Belgian-steel production will
have to contend with the compe-
tition of Germany, the Nether-
lands and Luxembourg-which
will grow sharper as the tariffs
go down. Belgium's carpet indus-
try, while not exclusive, is some-
what distinct and is a good ex-
ample of the "specialized product"
in the workings of comparative
advantage.
Another small country, Luxem'-
bourg, prior to 1960 depended on
steel and tourism for 90 per cent
of its gross national income. To
further stimulate her industrial
capabilities, Luxembourg recent-
ly began a policy of special tax
considerations for new concerns.
This policy has drawn major
American firms as DuPont and
Goodyear. Very likely, this coun-
try can be expected to settle upon
one or two industries for concen-
tration when a guaranteed mar-
ket can be established in the
Community for those industries.
Italian Cars
Italy has long been distinguished
for its fine cars. The Ferrari and
the Maserati come quickly to mind
when Italian industry is men-
tioned. These automobiles are
hand-produced, however, and the
greater wage demands from the
Italian worker has made the pro-
dduction of hand-made automo-
biles impractical. The result is
the production of Fiat and Alpha
Romeo, mass-produced models.
As the demand for automobiles
grows in the Community and au-
tomation opportunities increase,
the mass-produced Italian carwill
very likely become the mainstay
of the Italian economy, and Italy's
distinction in the Common Mar-
ket.
France, in a simple way of think-
ing, is the Community's farm. For
DeGaulle's Alacrity
In this light President deGaulle's
alacrity to begin the Kennedy
Round of tariff reductions on
agricultural products is easily ex-
plainable. For all practical pur-
poses, France will remain the
key producer of agricultural goods,
although automation may decrease
the number of workers on French
farms; the same automation com-
bined with the guaranteed market
will increase French production in
agriculture.
Germany, in a similar way of
thinking, is the Community's big-
gest factory. The German balance
of payments is very favorable, and
this indicates there is a high de-
mand in many quarters for the
industrial produce of Germany.
Specialized production within the
guaranteed market, and perpetra-
tion of the Kennedy Round on in-
dustrial products will bring in-
creased prosperity to Germany,
and further confirm her speciali-
zation in the industrial goods.
Simplification Dangerous
However, it is dangerous to sim-
plify the Common Market coun-
tries into one-commodity indus-
tries. This is hardly the case;
while the commodities which are
in the limelight in eacn Com-
mon Market country are not ex-
- -
WANTED!
TALENTED AND
ATTRACTIVE GIRLS
for Winter Weekend Chorus Line
to appear at Hill Aud. on Skit Night
TRYOUTS
Monday, Feb. 1-8:00 P.M.
Union Room 35
gium felt such sharp repercussions this reason it is pressing for a
in 1963 when the United States common agricultural policy which
introduced restrictive tariffs on will eliminate internal Commun-
woolen carpets. It is also for this nity barriers to farm trade, and
reason that Belgium looks so will help France dispose of her
favorably toward further progress, farm surpluses.
clusive, nor even necessarily domi-
nant in the individual country,
they are to some extent distinct,
and are therefore likely to with-
stand the competition of lowered
tariffs.
The six countries were estab-
lished then, and their production
capacities defined. It was then
left for them to decide in what
manner and how rapidly the tar-
iffs should be redudced, so that
the countries could begin to reap
the benefits of comparative ad-
vantage.
Initially, the treaty allowed a
period of 12 years for the reduc-
tion of tariffs according to a
schedule, with escape clauses
which could extend the period
to 15 years. However, the six
moved ahead more rapidly than
they expected. Three interrelated
developments made their rapid
progress possible: prosperity, the
reaction of business, and the
changed position of France.
New Proposal
Thursday, Jan. 14, 1965 the
Common Market disclosed a vital
new plan for eliminating all in-
dustrial trade barriers among the
nations by July 1, 1967. The plan
involves a two-step process to
eliminate the remaining 30 per
cent of the original tariffs on in-
dustry in the Market. From all
indications their success is prob-
able.
The implementation and suc-
cess of the Community has driven
other peoples and other. contin-
PAGE THREE
iMarket
ents to an agonizing reappraisal
of their own economic intercourse,
and a more favorable attitude to-
ward the theory of comparative
advantage.
The results: the European Free
Trade Association, considerations
in Asia of a common market, Afri-
can and Latin American enthusi-
asm for trade benefits in the
Common Market way, and U.S.
support and participation in the
general Agreement on Trade and
Tariffs and The Kennedy Round
of Tariff Reductions.
* * *
TOMORROW: The Kennedy Round
of Tariff reductions and GATT -
how the success of the EEC forced
the U.S. to negotiate for reduced
tariffs,
Support
the Annual
Kiwanis Sale
Feb. 11,12, 13
Nat'I, Guard
Armory-AI
proceeds to
those in need
regardless of
race, color or
creed.
AUSTIN
DIAMOND
1209 S. University-663-7151
MIR
if.
r'6Co ME
-ro
[oundup
y The Associated Press
AQUA, NICARAGUA;A-;
t Rene Schick announced
It he had authorized the
States to continue prelim-
udies of a possible route
'icaragua for a new canal
ie Central American isth-
his followed talks with
Mann, assistant secretary
for Latin American Af-
[ann was in San Jose,
1 ica yesterday for talks
esident Francisco Orlich
,1 possibilties. Mann also
visit Panama and Colom-
ORCE ACADEMY, COLO.
y-eight more Cadets have
from the United States
ve Academy, it was an-
yesterday, in the two-
iestigation of cheating at
tions.
)rings to 93 the number
ve resigned in the first
to strike the nation's new-
<e school. The investiga-
t was disclosed Jan. 19.
* * *f
DRLEANS, LA.-Members
ongshoremen's local here
usly ratified a new con-
posal yesterday and a sec-
t1 was expected to give
ipproval tonight.
iding vote of local 1418
remen's Association was
AFL-CIO International
ribed by local President
'. Chittenden as unani-
n favor of the contract.
ce Henry, President of
9, predicted his local also
)prove the pact.
dent here does not mean
~diate return to work, but
present another stride in
ffort to get 60,000 long-
i back on the docks from
STexas.
aents still remain to be
in other Atlantic and
st ports, and the ILA has
on't return to work in any
I all have settled.
rike, now in its 19th day,
has cost ithe nation's
half a billion dollars.
No American Ties
The British, however, maintain
their traditional connections with
the United States.
Chief among these is deGaulle's
conception of a European Europe
without American ties.
DeGaulle is grimly opposed to
either an Atlantic Nuclear Force
(ANF)which the British have pro-
posed, and to the original Ameri-
can conception of a Multilateral
Nuclear Allied Force (MIF).
There has also been friction and
irritation over the fate of the
projected supersonic commercial
airliner, the Concorde, which calls
for French-British cooperation to
produce it.
Common Market
There is also the question of
Britain and the Common Market.
DeGaulle vetoed British entry
and this touched off the current
atmosphere of British-French hos-
tility.,
Secretary of State Dean Rusk
also called on Wilson for a 35-
iminute talk. Their main topics:
-Progress of current inter-
allied exchanges on the British
project for an Atlantic Nuclear
Force.
-The payments crisis within
the United Nations which is likely
to lead to an adjournment of the
General Assembly.
-Wilson's own plans for visit-
ing the United States next month
which may have to be reviewed
in the light of the UN situation.
Commonwealth Heads
A procession of Commonwealth
government chiefs meanwhile has
been passing through Wilson's of-
fice. With Prime Ministers Robert
Menzies of Australia and Keith
Holyoake of New Zealand, Wilson
has been discussing policy towards
fellow - Commonwealth partner
Malaysia which considers herself
under threat of attack by Indo-
nesia.
Wilson thus far has made no
arrangement for private talks
with Russia's delegates, Deputy
Premier Konstantin Rudnev and
Marshal Ivan Koniev.
ST. ANDREW'S CHURCH and
the EPISCOPAL STUDENT
FOUNDATION
306 North Division
Phone 662-4097
SUNDAY
8:00 o.m.-Holy Communion.
9:00 a.m.-Holy Communion and Sermon.
Breakfast at Canterbury House. -
11 :00 a.m.-Morning Prayer and Sermon.
7:00 p.m.-Evening Prayer and commentary.
TUESDAY
9:15 a.m.-Holy Communion.
WEDNESDAY
7:00 a.m.-Holy Communion.
FRIDAY
12:10 p.m.-Holy Communion.
BAPTIST CAMPUS CENTER
502 East Huron 663-9376
9:45 a.m.-Campus Class, "Psychology and
Religion," Prof. Wilbert J. McKeachie.
11:00 a.m.-Worship-First Baptist Church.
7:00 p.m. -ILecture and Discussion, "The
Challenge of the Scientific Mood to the
Theological Task," Elizabeth Sumner, staff
member of the Office of Religious Affairs.
Paul W. Light - Campus Minister
James H. Middleton-Senior Minister
ZION LUTHERAN CHURCH
1501 W. Liberty St.
Ralph B. Piper, David Brocklein,
Fred Holtfreter, Pastors
Worship Services-8:30 and 11:15 a.m.
Holy Communion - Second Sunday of each
month.
Church School & Adult Bible Class-9:45 a.m.
Holy Baptism-First Sunday of month.
Nursery facilities during worship services and
church school.
En
DISCIPLES OF CHR
MEMORIAL CHRIST
730 Tappon-662-4
Russell M. Fuller-P
Sunday Worship-10:45
Monday: Buffet Lunche
Was The Week Th
CAMPUS CENTER GUIL
802 Monroe-662-5
J. E. Edwards-Cam
7:00 p.m. Sunday -
Christian Thought.
HURON HILLS BAP
Meeting at YM-YWC
Rev. Walter R. Peter
9:45 Sunday Bible Scho
11:00 Service
7:00 p.m. Evening Gosp
Thursday, 7:30 p.m.-.
and Prayer Service
BETHLEHEM UNIT
OF CHRIST
423 S. Fo
Rev. E. R. Klotidt, I
& Rev. A. G. Hab
9:30 and 10-45 a.m.-
9:30 and 10:45 a.m.-
7:30 p m -Student Gu
CAMPUS CHAPEL
Forest at Washtena
The Rev. Donald Pos
Sermon
10 a.m.-"Healing Hum
Brown.
Evening, 7:00 p.m. -
Donald Postema.
8:30 p.m.-Discussionc
residence, 1810 Covi
1ST F)RST METHODIST CHURCH and
IAN CHURCH WESLEY FOUNDATION
4245 At State and Huron Streets
astor Phone NO 2-4536
Sa.m. Hoover Rupert, Minister
. 1nnEugene Ransom, Campus Minister
on at 12 noon. "That Jean Robe Bissell, Associate Campus
at Was." Minister
D HOUSE SUNDAY
5189 9:00 and 11:15 a.m. - Worship Services,
opus Minister Henry Martin Loud, lecturer, Dr. Tracey
Seminar on Historic K. Jones Jr., Asst. General Secretaryof
the World Division of the Methodist
Board of Missions.
PTIST CHURCH 10:15 a.m. - Student Seminar, Social Hall
CA 350 S. Fifth'with School of Missions.
sen, Pastor 7:00 p.m.-Worship and.hProgram, Wesley
sen, Lounge, "The Task of the Christian," Dr.
ol Tracey K. Jones Jr.
TUESDAY
pet Hour 12:00 noon - Class, Pine Room. "Christian
Midweek Bible Studies Dating, Courtship and Marriage," Dr. Ran-
som. Lunch 25c.
5:00 p.m.-Church Related Vocations Group,
Green Room. "The Pastoral Ministry," Dr.
ED CHURCH Ernest Campbell. Dinner, Pine Room.
8:30 p.m.-Open House, Jean Bissell's ppart-
)urth St. ment.
Rev. A. C. Bizer, WEDNESDAY
aermehl, Pastors 7:00 ,a.m.-Holy Communion, Chapel, fol-
lowed by breakfast in Pine Room. Out in
-Worship Service time for 8:00 a.m. classes.
Church School 5:10 p.m.-Holy Communion, Chapel.
ild 6:00 p.m.-Wesley Grads, Pine Room. D)n-
ner and program. "Methodist Professor
Series": Dr. Seong Han.
THURSDAY
temo 12:00 noon-Class, Wesley Lounge. "Shapers
of Contemporary Theology," Mrs. Bissell.
Titles: Lunch 25c.
nor," Rev. Malchom G. FRIDAY
12:15 p.m. - Winter Retreat. Leave from
"The Church," Rev. Wesley Lounge for the Ecumenical In-
stitute in Chicago.
11
OLD H EIDELBERG
TONIGHT
i
I
group at the Postema
ington.
The
personal
way to say
B eMy Valentine
UNIVERSITY LUTHERAN CHAPEL
AND STUDENT CENTER
1511 Washtenow Avenue
(The Lutheran Church-Missouri Synod)
Alfred T. Scheips, Pastor
Stephen J. Stein, Vicar
Sunday at 9:45 and at 11:15: Services, with
sermon by the pastor, "How About Those
Miracles?"
Suhday at 11:15: Bible Study of "Holy Com-
munion"
Sunday at 6:00: Gamma Delta, Supper-Pro-
gram, with a talk on "The Church of the
Catacombs"
Class led by pastor
Monday at 8:00: "Let's Study Theology" -
Wednesday at 10:00: Midweek Devotion, con-
ducted by the vicar
ST. MARY'S STUDENT CHAPEL
331 Thompson
NO 3-0557
SUNDAY-Masses at 7:00, 8:00, 9:30, 11 :00,
12:00, 12:30.
MONDAY-SATURDAY-Mosses at 6:30, 7:00,
8:00, 9:00 and 12:00 and 5:00 p.m.
WEDNESDAY-7:30 p.m.-Mother Perpetual
Help Devotions. Confessions following.
SATURDAY-Confessions: 3:30-5:00; 7:30-
9:00 p.m.
LUTHERAN STUDENT CENTER
AND CHAPEL
National Lutheran Council
Hill St. and S. Forest Ave.
Pastors: Henry 0. Yoder
Norman A. Erikson
SUNDAY
9:30 and 11:00 a.m.-Worship Services.
9:30 a.m.-Study Group.
7-n n~l, m.-" Trends in Ame~ricnrals--
FIRST PRESBYTERIAN CHURCH
1432 Washtenow Ave.
NO 2-4466
Ministers: Ernest T. Campbell, Malcolm
Brown, Virgil Janssen, John Waser
SUNDAY
Worship at 9:00, 10:30 aA.. and 12.
Presbyterian Campus Center located
Church.
at the
ol
CONCERT
EARL ROBINSON'
COMPOSER-BALLADEER
AT FIRST UNITARIAN CHURCH
THE CHURCH OF CHRIST
W. Stadium at Edgewood
Across from Ann Arbor High
John G. Makin, Minister
SUNDAY
10:00 a.m.-Bule School.
11:0o.m.--Regular Worship.
6:00 p.m.--Evening Worship.I
WEDNESDAY
7:30 p.m.-Bible Study.
e gve a
II
11
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i