f
Seventy-Third ' ear
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rrutb Will Prevail"
orials printed in The Michigan Daily express the individual opinions of staff writers
or the editors. This must be noted in all reprints.
FISCAL REFORM:
Romney Package Has Varied Contents
DAY, SEPTEMBER 14, 1963
NIGHT EDITOR: PHILIP SUTIN
'Blue Bloods' Botch
Education Report
[ER NEARLY five-and-a-half months of
abor, the "blue ribbon" committee may
its interim report on the problems of
igan higher education to Gov. Romney in
oming week.
eting in executive session today, the com-
e will receive a draft report from its in-
subcommittee. If the full committee ae-
it, the report will then be sent to the,
mor.
er being sent to the governor, the report
most likely be bound in fine leather,
,raphed by Chairman Dan Karn and prob-
receive a niche in the' Capital library.
*TE EDUCATIONAL PROBLEMS are
ute as the Michigan Coordinating Council
ublic Higher Education's recent report em-
ized. It noted that in just two years time
0 additional students will be entering
igan colleges and universities.
rely a problem as crucial to Michigan and
esidents as higher education should be
the closest and most complete examina-
as possible.
V. ROMNEY'S COMMITTEE has not done
his.
wile the 50 odd "blue ribbon" citizens first
last April, very little if anything, was ac-
)Iished until late July and early August.
his time a 12-man interim subcommittee
formed to do. a report on the short term
ems of higher education. Almost simul-
usly the Kellogg Foundation made a
00 grant to the committee enabling it to
some staff personnel.
e Upjohn Foundation contributed the
without whom work would have remain-
a standstill. From about Aug. 6 to Sept.
ey worked "pulling together preliminary
rch." After another meeting of the sub-
nittee, last week, the Upjohn staff was
Show Biz
HOUSE Un-American Activities Com-
nittee hasn't been doing too well these days.
any fine, upstanding legislative committee,
eeds plenty of exciting headlines to keep
public from worrying about the fact that
oesn't do much legislating. But through
e oversight (i.e., conspiracy) the press just
n't seem too concerned about HUAC.
it Thursday, while investigating a group of
ents who were subverting our nation by
paring it to Cuba, HUAC's persistent pa-
s were smiled upon by Fate. 'The students
kind enough to stage a noisy demonstra-
--not a very, impressive one, but enough to
a banner headline on the front of the
ago Tribune. Luckily, the students got even
ilier as police dragged them out of the
ing room.
MIGHT even make a good movie.
-K. WINTER
Democratic 0
TTINESS was rife Thursday as the House
lebated Gov. George Romney's request for
ey for the Legislative Apportionment Com-
ion, established under the new Constitu-
Rep. Joseph Gillis (D-Detroit) tried to
k a $38,000 appropriation for the commis-
s work before January 1, but, after some
,te, the House, including Gillis, voted .the
ey.
ais incident is the latest in a series of par-
i squabbles over implementing the new
Atitution's apportionment provisions. The
ocrats, undoubtedly the losers under the
provisions as under the old, have attempt-
o delay and to becloud the issue rather
1 attempting to make the most of an im-
ible situation.
ider the new Constitution, the Senate
h currently has frozen districts will be dis-
ed on the basis of 80 per cent population-
er cent area. However, aside from giving
chunks of nearly-empty land a dis-
ortionate weight, the rules on multiple dis-
Editorial Staff
RONALD WILTON, Editor
VID MARCUS GERALD STORCH i
orial Director City Editor
ARA LAZARUS............Personnel Director
Ip SUTIN.............National Concerns Editor
EVANS................Associate City Editor
ORIE BRAHMS .....Associate Editorial Director
tIA BOWLES ...................Magazine Editor
NDA BERRY ............... Contributing Editor
GOOD........................ Sports Editor
BLOCK.................. Associate Sports Editor
IERGER...............Associate Sports Editor
zwINCS ........... Contributing Sports Editor
asked to "pull together conclusions of the
meeting." They received "less than a week" for
this task.
SO THE TOTAL TIME spent on one of the
crucial problems facing this state today was
less than four weeks. Much of this time was
taken up with preparing, printing and mailing
out the findings to the subcommittee members.
From appearances and from the words of
one of the leading members of the subcommit-
tee, the "blue ribbon" committee was not called
into existence to make any substantive con-
tribution. Romney established it to use the
names of the 50 odd distinguished citizens on
the committee's letterhead.
The leading member said he believed that
Romney's purpose in forming the committee
was to make passage of educational legislation
through the Legislature more facile In ad-
dition, he believed that a report from leading
citizens would bear more weight with the public
than one prepared by a government staff.
rJHIS WAS possibly the reason why all "blue
ribbon" meetings with the exception of the
first one were held in secret. It is hard to
believe that much could have been done before
the staff was obtained for two reasons. First,
since the staff did all the research work in
conjunction with a number of other agencies,
nothing was accomplished until a staff existed.
Second, without funds, no work or even meet-
ings could occur.
Either you keep meetings secret because
things of great importance are going on or
you close the doors in order to keep up a public
image because nothing of importance is going
on. In the case of the "blue ribbon" committee"
the latter case seems to be the correct reason.
IN THE LAST ANALYSIS, the crucial topic of
higher education in Michigan has been
handled in a slipshod manner. Supposedly
Gov. Romney established a special citizens
committee to study Michigan's educational
problems, but he failed to supply them with
funds.
BECAUSE OF DELAYS necessitated by this
lank of funds, no work was done for four
months. The work when it started was under-
taken by personnel of the Upjohn Foundation,
the Michigan Coordinating Council for Public
Instruction, and the governor's office. The
short range problem was investigated in less
than a month. And a fraud was perpetrated on
the people of Michigan by a supposed com-
mittee that received the credit without doing
any work.
The problem has been glossed over by Rom-
ney. The long term report which is to be com-
pleted by next year will undoubtedly be no
better than the present one. One thing that
the committee will certainly accomplish will be
having its report, which is secret, ready for
the governor by Oct. 1.
For this one (1) achievement, the committee
deserves one (1) round of applause.
-ANDREW ORLIN
bstructionists
tricts also work to the Republican's favor. The
Democrats gain slightly in the House as the
moiety clause requires that a district have .7
the population of the average district instead
of one-half as permitted under the 1908
Constitution.
BOTH THE apportionment provisions in the
old and new constitutions are being tested
in the courts. But the Democrats are not co-
tent to allow a final decision to settle their case.
They have, through delay and controversy,
attempted to prevent the redistricting of the
Legislature.
If the Democrats succeed in stalling the Ap-
portionment Commission's work, they will snarl
the 1964 election. The varied apportionment
procedures take at least six months and if
some decision on districts is not made by next
July, it will be impossible to hold primaries in
August or September. This breakdown in the
elective machinery will cause chaos.
DEMOCRATS, led by state chairman Zolton
Ferency seem intent on causing chaos
rather than waiting for court action-their best
hope. Ferency loudly refused to appoint the
Democratic members of the commission and
only did so after Romney went to great lengths
to compromise with him. The request for the
supplemental appropriation and legal status for
the group until Jan. 1 followed.
The Republicans were not helpful either.
Romney in his special message to the Legis-
lature went out of his way to berate Demo-
cratic intransigence. This made the Democrats
mad, for they felt this violated the spirit of
the compromise.
Fortunately, cooler heads prevailed and the
To The Editor
By MICHAEL HARRAH
NOW COMES Gov. George Rom-
ney with his long-awaited tax
reform program to save the State
of Michigan from fiscal oblivion.
In many ways it was not surpris-
ing; in many ways it was encour-
aging; in many ways it was disap-
pointing.
True to his word, the governor's
program does not involve any in-
crease in state spending or actual
taxation revenues. Romney seems
to be making a genuine effort to
economize wherever possible.
The fiscal reform package itself
consists of eleven points in dollar
consequences, eight of them tax
reductions and three of them tax
levies. The total amount of money
at issue is $306 million.
THERE ARE good measures:
The repeal of the business ac-
tivities tax will cost the state some
$78 million annually, but it will
alleciate the financial hardship
now laid upon businesses not op-
erating at a clear profit. Repeal of
the BAT would result in encourag-
ing new businesses to establish and
continue in Michigan without a
crippling tax in their costly, for-
mative years, and it would allow*
established but floundering con-
cerns to recover without the alba-
tross of -a heavy taxation.
Hand-in-hand with repeal of the
BAT would be a two-year exemp-
tion of new corporations from the
corporate franchise tax, an annual
loss of $500,000 in revenues. This,
too, would encourage new busi-
nesses to locate and continue in
Michigan.
* * *
EXEMPTION OF prescription
drugs from the, current four per
cent sale tax would result in a
substantial saving for the aged
and infirm, who expend large
amounts annually for medicines.
The loss to the state would be on-
ly $1 million per year, but the'sav-
ing to those living on fixed in-
comes, where every penny means
a lot, would be quite meaningful.
Also desirable is the repeal of
the state intangibles tax, which
currently nets $35' million a year
in revenues. This tax effectively
amounts to double-taxation, col-
lected largely on dividends and
annuity payments, this tax hit the
citizen with a fixed income par-
ticularly hard. In addition, the
tax is collected twice on the same
money: Once when the corpora-
tion has it, and then again when
the stockholder receives it as a
dividend. This is considered double
taxation, since in effect the stock-
holder IS the corporation.
* *, *
EXEMPTION of foodstuffs from
the. sales tax would cost 'the state
some $91 million in revenues, and
here the whole business begins
to get sticky. For instance, many
items are sold in food stores; what
constitutes foodstuffs and what
doesn't? And even among food-
stuffs, should caviar be exempted
along with milk, or candied bum-
ble-bees along with bread? This
would defeat the whole purpose of
the exemption, true, but where
does one draw the line?
Besides, a sales tax, whether it
be on foodstuffs or alppliances is
relatively painless to pay, regard-
less of what it amounts to in the
end. The shopper' would much pre-
fer paying out 40 cents on a $10
purchase several times a week than
to see some three or four dollars
withheld from his salary during
the same week.
* * *
ANOTHER PROPOSAL, the
Homestead tax deferral for senior
citizens will cost $6 million an-
nually in revenues. (In essence,
this amounts to a mortgage, pay-
able only after death.) Granted, it
is a noble sentiment and undoubt-
edly it will ease the burden on
senior property owners, but it will
also bring a rash of lawsuits that
won't quit.
Suppose that old Mrs. X owns
a piece of property and she de-
fers $200 a year in property taxes.
This begins when she is 65 years
of age and she lives to be 85. Some
$4000 has piled up in back taxes by
this time, and suddenly Mrs. X
dies. The state immediately steps
in and demands the back taxes.
Mrs. X has been living on a small,
fixed income, so her estate con-
tains little cash. She has willed
the old family homestead to her
daughter, a spinster, who has
lived with Mama all her life, but
the back taxes, the funeral ex-
penses and the state and federal
inheritance taxes are so high that
the property must be sold to meet
the. payments. Spinster daughter
is left out in the cold, hardly a
desirable or just circumstance.
GENERAL PROPERTY tax re-
lief will cost $93 million, and this
too is commendable, but perhaps
a bit optimistic. Once again, this
reduction serves to alleviate the
burden on those with fixed in-
comes, but the question becomes
how long will the tax stayed re-
duced?
We must recall that property
taxes started out low and worked
their way up due to rising govern-
m e n t a 1 expenditures. Current
spending policies on the part of
local governments do not seem to
indicate that governmental ex-
penditures will cease rising, so it
would seem safe to assume that
the temporarily reduced property
taxes will soon find an occasion
to rise again. Quite obviously this
will defeat the whole purpose of
the tax reform.
* * *
BRINGING UP the rear in the
area of tax "reforms" is a one
and one-half million cut in the
tax on beer, which looks extreme-
ly out of place among the rest of
the "humanitarian" tax measures.
Whether or not this item goes or
stays is of little relevance to any-
one but the brewers, and I daresay
it is of little consequence either,
when the figure under discussion
is $306 million.
* *
ON THE REVENUE side of the
ledger, somewhat more simple but
somewhat more controversial, are
the three revenue producing meas-
ures.
The smallest item is a total
five and a half per cent on' finan-
cial institutions. Probably no one
argues with this. Since state law
prohibits more than one tax being
levied on financial institutions
five and a half per cent is ad-
mittedly reasonable.
Next is a three and a half per
cent tax on corporate income,
which will yield 81 million yearly.
This replaces the business activi-
ties tax, and the only difference is
that this tax is on net income and
not gross income. Here again we
have a very reasonable tax rate.
In fact, since this tax is on a
company's clear profit, one might
perhaps not be amiss in suggest-
ing that three and a half per cent
is too reasonable. Another one
and a half per cent (for a five per
cent total) would reap another
$35 million.'
THE PROBLEM, however, arises
with the final measure: The im-
position of a $216 million, two per
cent levy on personal income. This
levy would be added onto the pro-
gressive federal income tax, the
four per cent state sales tax, the
federal capital gains, federal and
state inheritance and gift taxes,
federal and state luxury taxes,
federal and state nuisance taxes
on liquor, beer, cigarettes, gasoline
and gambling, federal excise taxes,
to say nothing of reduced but
still ominous local property taxes'
and the impending threat of a lo-
cal income tax, such as the one
now levied in Detroit.
Faced with this prospect, one
must seriously doubt that the mass
of individual -citizens will welcome
an income tax, with only the pros-
pect of food and drugs being
exempted from the sales tax. Two
per cent of a man's yearly income
looks bigger to him than four per
cent of a ten dollar bill now and
then each week. Perhaps in fact
it isn't, but it's appearances that
count.
* ** *
*4
GOV. ROMNEY stresses "More
Jobs and More Justice" in his tax
reform program. True, it will An-
doubtedly create "more Jobs," for
it is a structure specifically set up
with business in mind.
As far as "more justice" goes,
the pattern begins to get vague.
To the Editor:
PHILIP SUTIN'S pretentious at-
tack on United States policy in
South Viet Nam succeeds only in
reflecting the poverty of thought
which has so long characterized
that policy. Six paragraphs of
lashing but unoriginal criticism
backed up with the traditional
"backtrack slightly and attempt
to maintain the current military
situaton" is hardly useful com-
mentary.
And waiting for revolution-for
others to do the work-is a waste-
ful and dangerous delegation of
power. Indeed, an anti-Diem revo-
lution might well bring more
headaches than it is worth, par-
ticularly in the event of an in-
crease in popular support for the
Viet Cong. In short, we have been
watching and waiting for ten
years; and taking a diplomatic
thrashing in the process.
THE ONLY real hope for a
happy exit was glibly passed up by
Sutin-a reunified and neutral
Viet Nam. The argument was that
Diem and Ho Chi Minh would not
be willing to negotiate; yet the
Diem family's corrupt and brutal
management of South Viet Nam
does not suggest that they would
be hindered by anything like prin-
ciple.
Too, Diem has well-publicized
connections in Hanoi which would
prove useful if he were forced to
make serious use of them-and
the recent French suggestions, if
Kennedy would listen, seem to pro-
vide a starting point for such
force.
Senior citizens, persons with fixed
incomes, and the infirm definitely
benefit; but these persons make up
a small part of Michigan's popula-
tion. The large bulk of the citi-
zenry is faced only with an income
tax that will offset the exemption
of foodstuffs from the sales tax, a
reduced property tax that will un-
doubtedly go up again and the
prospect of local income tax on
top of it all.
One tends to doubt whether this
will seem like fiscal reform to Mr.
Average Citizen. Gov. Romney
pointed out that there is a need
for tax reform in Michigan. This
is undoubtedly true, but the gov-
ernor seems to be confusing tax
reform with tax rearrangement,
and the two aren't necessarily the
same.
* * *
HE HAS STAKED his prestige
on the line to see this program
succeed, saying "if not now, when?
and if not me, who?" His tax mes-
sage was inspired, and he delivered
it well. The initial impression is a
good one, but when the glow of his
spoken word wears off, when the
legislators try to explain 'this to
the folks at home, and when the
average citizen sees another two
per cent of his income bitten off,
perhaps tax reform will not sound
so pi'essing.
The next several weeks will tell.
A REALLY constructive policy
might take the following steps:
1) Move out the CIA and de-
clare openly the extent of our aid
to Diem; thent
2) Initiate talks with the
French, indicating a willingness to
make use of their experience in the
area and an interest in a united,
neutral Viet Nam; at the same
time,
x 3) Making it clear to Saigon
that continued internal tyranny
will be met with decisive reduc-
tions in nonmilitary aid.
* * *
IT STRIKES ME that winning
this war is impossible: neither we
nor the Chinese are willing to give
up Southeast Asia. The only pos-
sible solution" is a detente, yet
Washington and Mr. Sutin persist
in advocating the line of policy
which has not, and will not, pro-
duce anything but a long and
costly war of attrition.
-Edwin G. Burrows, '64
Bells , , ,
I AM a medical student living
near Burton Tower. Almost
every night of the week the caril-
lion blasts in my window, and I'm
sure that I'm not the only one who
finds this an annoying hindrance
to studying. If it must be played,
can't it be played at an earlier
hour (5:00-6:00 p.m.) when most
people are having dinner-and not
when students try to study? I like
music but not when, like an air
raid siren, it is too loud to be
muffled by a closed window.
-Dale Jacobs, '66M
"As For Civil Rights, I Agree With Sen. Goldwater
That This Is A Matter Of State Rights-Uh.-
Let's Finish This Speech Somewhere Else"
4r
S ' a
CITYSCOPE:
Demonstrators Meet
Dead End on Ordinan ce
rV
I
¢r
JL
. 'a I ".
By WILLIAM BENOIT
MAYOR CECIL O. CREAL and
the Ann Arbor City Council
pay they are embarrassed over
picketing and sit-ins at City Hall.
The only action that could delay
further civil-rights demonstrations
is passage of a strong fair-housing
ordinance, an ordinance radically
different and significantly more
complete in its coverage of bias
in housing than the ordinance
now up for council consideration.
Even if such an ordinance were
passed, contrary to the wildest
expectations of any fair housing
advocate, it is possible that similar
demonstrations would continue}
with varying only in the ends
they would hope to achieve. For
instance, the local Congress of Ra-
cial Equality is considering dem-
onstrating for fair employment
practices when and if the fair
housing battle is won for them.
* * *
SIT-IN demonstrators make bad
publicity for Mayor Creal. Lately,
they forced him into a defensive
position at a Michigin mayor's
meeting.
Mayor Creal asks what is the
rationale behind sit-in demon
strations. This is an incredibly
naive question. Sit-ins are used
by civil rights groups because these,
groups believe the ordinance ,now
in council scheduled for its second
reading is inadequate and there-
fore wrong.
Demonstrators have met dead
ends in trying to negotiate with
council and Mayor Creal. The de-
vice of public hearings or closed
council sessions is tired, worn out,
and has proved ineffective in num-
erous attempts.
THIS WEEK, Eastern Michigan
University Prof. Quin McLoughlin
was convicted under a section of a
city ordinance prohibiting loiter-
ing. His sentence was $50 or five
days.
This is significant in that Prof.
ably continue as long as there are
people to bring into court. But
even if CORE, the Direct Action
Co tmittee and other civil rights
groups run out of demonstrators,
civil disobedience is frequently
symptomatic of a deficiency in
government.
It is very likely that the defi-
ciencies lie in Mayor Creal and his
"Neolithic council member flunkl
ies." It is wrong, basically and
fundamentally wrong, to ignore
intelligent Ann Arborcitizens who
wanted to reason with council and
perhaps arrive at an adequate or-
dinance. Folly is added to political
wrong when an attorney for the
city makes a "dramatic" and "im-
passioned" plea for men to refrain
from "placing, themselves above
the law and therefore above G"
as did the prosecuting attorney in
the McLoughlin case.
* * *
IS IT NOT possible that the
men who make the laws are them-
selves somewhat short of perfec-
tion? And while on the subject of
God, it might be well to note that,
many Ann Arbor clergymen align
with demonstrations and civil
rightists' demands.
r
Fresh Air,
I
G NERAL de Gaulle certainly
has not offered a surefire rem-
edy for the woes of Viet Nam, but
he has let some fresh air into the
miasma which American policy
has generated and in which we
ourselves are stifling.
It may be, in view of the situa-
tion in Laos that a better solution
would be a federation of North
and South, the North to remain
Communist the South capitalist
with free intercourse between the
two and no foreign interference,
either from Red China or the
United States.
This is no easy solution, but it
is far more realistic than anything
k;
S,
.: