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November 14, 1971 - Image 8

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Publication:
The Michigan Daily, 1971-11-14

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11 Page Eight

THE MICHIGAN DAILY

Sunday, November 14, 1971

I

Page Eight THE MICHIGAN DAiLY Sunday, November 14, 1971

Phase 2 begins for new
U.S. economic program

STATE VS. 'U':

Autonomy ;ho shall control?

FREE BILLIARD
INSTRUCTION
Thurs. 7-9 p.m.
Nov. 11 & 18
Michigan. Union

(Continued from Page 3)
and more competitive in world
markets. The other countries
balked.
They are still balking. They
want the United States to come
part way by directlyrdevaluing
the dollar; that is, raising the
price of gold. They want assur-
ances on the removal of the
surcharge before revaluing their
currencies and removing trade
barriers.
The deadlock has magnified
antagonisms across the Atlan-
tic, and soured relations be-
tween the United States and its
two greatest trading partners,
Canada and Japan.'
The United States, meanwhile,
had its first balance-of-trade
surplus in six monhts in Sep-
tember,. a $250-million margin
that was helped by a rush of
shippers to beat the Oct. 1 start
of a dock strike. And the sur-
charge brought in nearly $100
million in customs revenue.
As a protective tariff and
revenue-raiser, the surcharge
appeared to have had consider-
able success. But as a persuader
of this country's trading part-
ners it hasn't worked, so far.
By contrast there is proof-
in the form of the consumer
price index -- that the wage-
price freeze did work. How ef-
ficiently it worked is a matter
of some argument. All govern-
ment reports show excellent
compliance. Some private re-
ports do not.
Larger firms unquestionably
observed the freeze. In one sam-
pling of 10,951 business firms,
the Internal Revenue Service
said it found 10.150 complying.
Of the others. IRS got quick
voluntary compliance in 499
cases.'
Some unofficial inquiries pro-
duced other results. The New
York Times reported last month
that retailers raised the prices
of seven out of 27 cuts of meat
illegally.
The Times said the federal
order requiring merchants to
provide lists of freeze prices was
more often ignored than not. A
computerized price watch start-
ed by the American Federation
of State, County and Municipal
Employes corroborated t h i s
finding on a national basis.
The OEP reported four ma-
jor areas of concern and com-
plaint, out of an analysis made
available to the President's new
Phase 2 control agencies, the
Price Commission and the Pay
Board. These were:
-Complaints from groups,
such as school teachers and
unions, which had wage in-
creases scheduled but were un-
able to collect them;
-Merchants objecting to the
requirement that they maintain
price lists for inspection;
-A spreading feeling by the
public that prices, especially in
grocery stores, were not being
frozen as hard as wages and
rents and that the freeze fav-
For the student body:
FLARES
by
~'Levi
Farah
Wright
Lee
"Male

CHECKMATE
State Street at Liberty

ored business over workingmen;
and
-Rising concern,bconfusion
and uncertainty about what
would happenrto the price-
wage control program when the
freeze ended.
Labor's antipathy for the
freeze plague Nixon's policy-
makers from the start. The
freeze was just four days old
when AFL - CIO President
George Meany described it as.
"inequitable, unjust, unfair and
unworkable."
Then Secretary of Labor J.D.
Hodgson said Meany was "sad-
ly out of step" with the labor
movement, and Secretary of the
Treasury John B. Connally ac-
cused the 77 - year - old labor
leader of "rank demagoguery."
Faced with possible collapse
of his program for labor-indus-
try - public cooperation in a
price-wage program before it
was even started, President
Nixon took steps to placate the
AFL-CIO.
He promised a tripartite Pay
Board with labor, management
and public members, and pledg-
ed - despite hints-to the con-
trary from Connally - that it
would have independent and au-
tonomous power over wage
cases.
Meany and four other union
leaders took seats on the Pay
Board. The board's deliberations
culminated last Monday in a
5.5-per-cent y e a r 1y general
guideline for Phase 2 pay in-
creases and the approval of de-
ferred pay increases under exist-
ing contracts except for those
"unreasonably i nc o n s i s t-
ent" with the 5.5 percent stan-
dard.
But the five industry and five
public members overrode labor's
demand for retroactive pay-
ment of scheduled pay boosts
that were blocked by the fieeze.
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(Continued from page 1)
The universities, however, have
gone ahead with these programs
on their own because, as Daane
says, the state constitution sharp-
ly limits the boards powers to
"planning and advising" institu-
tions of higher,education.
As the board joined the side of
the state, another group joined
the side of the "Big 3" universi-
ties. The Michigan Association of
Higher Education, which repre-
sents faculty at some of the small-
er state schools, entered the case
this month, particularly concern-
ed about the impact of the suit on
faculty teaching requirements.
But even when Ingham County
(Lansing) Circuit Judge Marvin
Salmon hands down his decision
later this month, the end of the
dispute will not be in sight. Both
sides have said they will appeal
the case to the State Supreme
Court - a process Krasicky says
could take another two years.
If the case is eventually decided
in favor of the state, the implica-
tions could be expensive. By tying
controls to future appropriations
bills, the Legislature could spread
its influence into nearly every
aspect of University life.
And if the case goes for the
universities, the current limita-
tions on their operations would be
removed, and their autonomy
from state or board of education

control would once again be de-
fended.
But th degree of control which
either side would exercise after
the decision remains unclear.
It is unlikely the Legislature
would movetoassume control
over many aspects of the Uni-
versity. For when the Legislature
had the chance to assume such
control - in the form of a pro-
posed constitutional amendment
which would have stripped the
universities' constitutional autono-
my away - the proposal was
soundly defeated' by the State
Senate in July, 1970.
The University, on the other
hand, mustalways keep somewhat
attuned to the wishes of the Leg-
islature-because that body con-
trols the pursestrings on Univer-
sity funds.
As Daane says, "A working re-
lationship must be maintained.
The Legislature might be told to
'go bag it' but the next year it
will keep funds low."
"With autonomy and 15 cents,
all you can buy is a cup of coffee."
Indeed, it seems that the uni-
versities' timidity in "stepping on
the toes" of the Legislature when
appropriations time has approach-
ed, has been one reason the suit
has taken so long. The universities
would apparently press their case
at times and then let up during
negotiations with the state.

So, though the questions of
autonomy are both important and
far-reaching for the University
and the state, they are questions
which have, it seems, no easy
answers, or no immediate solu-
tions.
Award granted
The Society of Economic Geolo-
gists will present its annual Lind-
gren Award to Alexander Brown,
recently a graduate student in
the geology department, for his
research on the White Pine copper
deposits of Northern Michigan.
This award is based on an inter-
national competition and g o e s
to that student whose research as
a doctoral candidate is deemed
outstanding by the society. Brown
is now an assistant professor in
the geology department of t h e
Ecole Polytechnique in Montreal.
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