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March 25, 1965 - Image 3

Resource type:
The Michigan Daily, 1965-03-25

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Moon Photos

Monetary Policy: Struggle for Relief

Show Volcanic Activity
On Surface Craters


-AssociatedP ress
THIS IS ONE OF THE PHOTOGRAPHS televised by cameras
aboard the Ranger 9 spacecraft early yesterday. It shows the
crater Alphonsus from an altitude of about 400 miles. The
Ranger later crashed into the crater. Last night, scientists re-
vealed there was a good possibility of volcanic action on this and
other craters.
Peking Threatens To Send
'Volunteers' To Viet Nar
TOKYO ()-Red China said yesterday "we are ready to send
our men" to fight in Viet Nam.
The declaration was made by the official Communist Chinese
party newspaper People's Daily in response to a call Tuesday by the
Communist Viet Cong for men and material.
The People's Daily said "we Chinese people firmly respond to

Nation Views
Lunar Sites
In Telecast
Hails Flight Series
As 'A Good Start'
By The Associated Press
PASADENA, Calif.-"Best ever"
photos of the crater hit by Ran-
ger 9 yesterday show strong evi-
dence of volcanic activity - yet
indicate craters may make bet-
ter astronaut landing sites than
A panel of scientists analyzed
10 of the spacecraft's 6,150 pic-
tures at a Jet Propulsion Labora-
tory news conference in Pasadena
last night. One expert said the
shots showed at least three types
of craters not caused by meteor-
Earlier, in a major space first,
commercial networks relayed to
home television viewers a spec-
tacular series of 200 close-ups
transmitted during the final 2
minutes of Ranger 9's death-dive
into the 60-mile-wide crater Al-
Volcanic Crater
Dr. Eugene Shoemaker of the
United States Geological Survey
at Flagstaff, Ariz., said some of
the three types of craters might
be of volcanic origin. Others, he
said, might have resulted from
collapse of crustal material along
fissures resulting from under-
ground gas pockets. Still others
seemed to be filled with a de-
posited material which could only
be dark volcanic ash.
Another expert, Ewen A. Whit-
aker of the lunar and planetary
laboratory of the University of
Arizona, said parts of the high-
lands around the crater and ridg-
es within the crater seem harder
and smoother than the dusty lu-
nar plains.
Dr. Gerard P. Kuiper of the
same laboratory said of the cra-
ter: "It might well be better to
make landings there."
Smooth Walls
Th most significant finding of
Ranger 9's photographs, Shoemak-
er said, is the smoothness of the
crater wallshand long ridges on
the floor of the crater.
Meanwhile, it was revealed here
that astronauts Virgil Grissom
and John Young - fresh from
mastering space for nearly five
hours-just couldn't take 45 min-
utes of bobbing and pitching at
the mercy of the unkind Atlantic
Grissom and Young both be-
came seasick Tuesday and Gris-
sonm vomited before the space
twins were hauled up to theheli-
copter that brought them to the
aircraft carrier Intrepid.
They mastered easily the blast-
off and the trip into space Tues-
day, putting their new Gmini
spacecraft, the Molly Brown.
through intricate and pioneering
maneuvers during her three or-
bits of the earth.

the statement," and added that "a
send our men, whenever the
South Vietnamese people want
them, to fight together with the
South Vietnamese people to an-
nihilate the United States aggres-
Widening Propaganda
The statement appeared part of
a widening Communist propa-
ganda campaign pegged to a pos-
*sibility of sending men to fight in
Viet Nam.
For several weeks Peking propa-
ganda directed at the United
States in English has referred to
"volunteers" offering their serv-
ices for duty in South Viet Nam.
Soviet Communist Party Leader
Leonid Brezhnev, in a Moscow
Red Square Speech Tuesday, spoke
of Russian "volunteers" offering
to fight in Viet Nam. A Soviet
spokesman said in Moscow later
that there have been many appli-
cations from Soviet citizens desir-
ing to volunteer and these would
be considered.
In Washington, State Depart-
ment Press Officer Robert J. Mc-
Closkey said the department has
no evidence that people are in
fact volunteering for duty in
South Viet Nam.
Red China also talked of "vol-
unteers" before hurling hundreds
of thousands of meri into Korea
in late 1950 when U.N. forces had
almost won the campaign against
the North Koreans.
In 1956, Soviet Premier Nikita
Khrushchev threatened repeated-
ly during the Suez crisis to go to
the aid of Egypt with Soviet vol-
unteers against forces of Israel,
Britain and France who had in-
vaded the Egyptian Sinai Penin-
sula and Suez.
The latest Chinese statement
was in response to a call by the
Central Committee of the South
Viet Nam National Front for lib-
eration, under which the Viet
Cong operates.
The People's Daily of Peking de-
scribed the call as "a just con-
demnation of U.S. imperialism
a clarion call to the people
throughout the world to rise in
support of the South Vietnamese
people and defeat U.S. imper-
For information write:
Academic Aids, Box 969
Berkeley, California

Modern economists are cur-
rently struggling to relieve an
overburdened monetary policy.
The monetary authorities, who
control credit conditions, are
plagued by the conflicting goals
of domestic growth and balance-
of-payments stability.
Payments problems overburden
monetary policy because low-in-
terest rates, instituted by mone-
tary authorities to stimulate do-
mestic growth, at the same time
discourage foreign investors who
prefer to earn a higher return
on their investment.
Economic policy-makers must
choose between developing nevw
monetary schemes that will rec-
oncile these conflicting goals, and
a revitalization of fiscal policy.
By changing tax rates or alter-
ing government expenditures, fis-
cal operations can change total
income. Until the development o.
balance-of-payments deficits in
the late 1950's, fiscal policy wa.
only needed for major, long-range
operations. Monetary policy tra-
ditionally has been the working,

t the same time, we are ready to
By The Associated Press
WASHINGTON-The adminis-
tration's $1.3 billion school aid
bill yesterday became embroiled
in the church-state issue that ha,
sent many similar bills down tc
defeat. A shouting debate erupt-
ed in the House despite leaders'
attempts to suppress the contro-
* * *
Ways and Means Committee for-
mally voted yesterday to send tc
the House the administration's $f
billion medicare program which
includes hospitalization, optional
medical services and Social Secur-
ity benefit increases for the aged
House leaders are pushing for 8
quick vote on the committee bill
but they probably will not be able
to arrange one before the week of
April 5.

Daily News Analysis {
short-range apparatus of govern-
ment stabilization policy.
Payments deficits have upset
this functional distinction and
have convinced many economists
that fiscal policy must be made
more workable. More expedient
fiscal operations would free mone-
tary policy from its domestic-eco-
nomic responsibilities and enable
it to deal more effectively with
payments problems.
The source of the incompatibil-
ity between payments stability
and domestic expansion involves
the dual functions of interest
Domestic investors, who borrow
funds to invest in new machin-
R'dits March
Nears Climax
By The Associated Press
Martin Luther King led 4000 civ-
il rights marchers into Montgom-
ery yesterday for a massive tent
rally and the final leg of a 50-
mile pilgrimage from Selma.
The ranks of marchers 'mush-
roomed after King rejoined the
trek which ends today with a six-
mile march through the city to
the historic old Alabama capitol.
National Guardsmen and Army
regulars patroled the march.
In Washington, civil rights lead-
er Roy Wilkins claimed Presi-
dent Lyndon B. Johnson's right-
to-vote bill is good but is not
enough. He urged Congress to
toughen its terms.
Sen. Sam J. Ervin, Jr. (D-NC)
insisted the bill is already out of
constitutional bounds.
Wilkins, executive director of
the National Association for the
Advancement of Colored People
told a House judiciary subcommit-
tee that Congress should strength-
en the bill "to sweep the last
vestiges of voting restrictions in-
to the sea."
He said the nation has paid for
discrimination in voting with
"mayhem, riots and murder be-
cause those who sought the right
to vote were opposed by those
who were willing to suppress
rights with violence."

ery or new factories, will be en-
couraged by the low-interest rates
that represent a lower cost o'
borrowing. Foreign investors, whc
receive interest-bearing bonds o-
notes for the funds they lend.
will be discouraged by the low-
interest rates that for them rep-
resent reduced revenue.
If the foreign investors becomc
discouraged ,and convert their
funds from U.S. bonds to foreigr
earning assets, the U.S. payments
situation may become worse. Thi'
is due to the fact that the bal-
ance of a nation's payments is
partially determined by the net:
flow of capital funds into or out!
of that country.
Without a revitalization of fis-
cal policy, then monetary policy-
makers, the Federal Reserve Sys-
tem Board of Governors, must
do the best with the policy in-,
struments they have.
Operation Twist
However, another policy, pop-
ularly known as "operation twist,'
has tried to reconcile the con-
flicting goals by operating in onr
direction for short-term bonds
and another for long-term obliga-
tions. Since capital flows appear
to be highly sensitive to short-
term interest rates, these rates
were kept high to attract foreigr
funds, while long-term rates wer-
kept low to encourage businesF
expansion. This policy suffer
from the built-in tendency of in-
terest rates moving together anc
from the confused expectations
generating among\ investors, whc
cannot interpret Federal Reserve
Should more effective fisca
measures be employed to regu-
late the income flow, the mone-
tary authorities would be free tc
concentrate upon payments sta-
bility. High interest rates woule
attract new, or maintain existing
foreign commitments, while ex-
pansionary -fiscal measures - tax
cuts or higher government expen-
ditures-would offset the domes-
tic deflationary pressures that
high interest rates exert.
Prof. Warren L. Smith, chair-
man of the economics department,
favors the second general ap-
proach. Smith, former member of
the Council of Economic Advisors
questions the wisdom of over-
burdening monetary policy.
Moderating Function
Smith expresses faith in mone-
tary policy as a moderator of
normal fluctuations, but warns
that "it would be a dangerous
mistake to overrate its potency
and to place major reliance on its
stabilizing power to the neglect
of fiscal policy."
He suggests that "we could keep
interest rates where they are and
rely upon expansionary fiscal pol-
icy without impairing payment:
stability." The policy theorist fur-
ther advises that "we must be pre-

Solid Four

pared to use fiscal policy on r
much more flexible basis."
Several innovations could be
employed to make fiscal policy <
more workable, less cumbersome
tool. The President's control ovei
taxation could be systematized t-
reduce administrative clogging.
Smith suggests that tax legisla-
tion could be a more efficient
counter-cyclical weapon if a spe-
cial time limit was imposed to
prevent filibuster and other ob-
structionist tactics.
Automatic Alteration
Several theories, still in the
embryonic stage, are being devel-
oped to make tax rate alterna-
tives more automatic. Income tax
rates are built-in stabilizers be-
cause, as income rises or falls,
tax receipts increase or decrease
More sensitive income tax rates
would generate more powerful
counter- cyclical pressures upon

the economy because they would
respond earlier to inflationary or
recessionary tendencies.
On the expenditure side, future
government works projects could
be systematically placed on a
waiting shelf to reduce the lag'
between recognition of and action
upon a specific malady.
Smith claimed that he did not
intend to criticize the concept of
monetary policy, but that he waA
interested in lessening its burden
"There is too much inclination
to pick a monolithic goal and then
criticize the government for fail-
ure to cope with it," he said.
To effectively achieve two goals
two weapons must be efficiently
coordinated. A modernized fisca
arsenal, by relieving the monetary
forces that are fighting on two
fronts, would enable the U.S. gov-
ernment to work toward pay-
ments stability and domestic pros-
perity simultaneously.

Gives Y

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Ann Arbor Bank pays 4% interest on
compounded and paid quarterly. A
Savings accounts are insured up to $1
Deposit Insurance Corporation.
Put your savings in action today! Ann A
gives you more--so add to your saving
automatic savings plan at any one of A
offices at your earliest opportunity.
" East Lib
" southU
. Plymou
And 4 M

'ou More!...
all savings accounts,
01 Ann Arbor Bank
0,000 by the Federal
rbor Bank's Solid Four
gs account or start an
nn Arbor Bank's seven t
iberty Street Near Maynard
university at East UniverstY
th Road at Huron Parkway
ore Offices serving

12 to 3:30!

:i ":?::"::":::":":":{":::":::"i}::"..
i": "7?::'":"i:":":.......
:."r.". " ".: :.": ┬░ti:titi

If everybody and his
duck-billed platypus phones
Long Distance at 9 P.M.
Why don't you phone
earlier-or later'P
Drop at
s~ r
Like, say, anytime between 8 P.M. and
4:30 A.M. week nights, or anytime (day or
night) on Sunday.
Those are the times when the lowest
station-to-station Long Distance rates are
in effect. They never get any lower!
By the way, station-to-station calls be-
tween points in Michigan always cost some-
what more when you call "Collect." But,
you don't have to wait 'til 8 P.M, to phone
because the lowest rates for "Collect" calls
start at 6 P.M. week nights. And they are
also in effect every weekend-all day Satur-
day and Sunday.

Don't miss the
live modeling
in our windows
and on our
Lower Level.
Tomm Kehoe, Cole's
represenative, will
be here to give
you the latest on
new swimsuit
styles and to take
special orders.
Shown here is Cole's
Helanca nylon knit
in a low slashed
mio with a bare
beautiful back.
Black. 8 to 20

1917 Washtenaw
Sunday, 8:00, March 28




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