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December 10, 1977 - Image 8

Resource type:
Michigan Daily, 1977-12-10

Disclaimer: Computer generated plain text may have errors. Read more about this.

Murray knew of investment
scandal, Levin charges

(Continued from Page 1)
you should have known."
"I did not know," Murray said.
Russell also said that Levin's
appeals hearing, scheduled for this.
Tuesday, will be a farce since
Murray, who fired Levin, was re-
sponsible for choosing the three
members of the appeals board.
MURRAY FIRED Levin last Oct. 5
in a city hall shake-up that followed
revelations that the controller's of-
fice had entered into an arbitrage
agreement with Merrill Lynch, the
investment firm. The city, under the
transaction, borrowed a treasury
note, sold it, and used that money to
buy another note it hoped would be
more profitable.
Levin apparently found out six
months after making the investment
that Merrill Lynch had been lying
and the city was actually losing
money on the deal, so he entered into
the possibly illegal June 30-July 1
arbitrage transaction for which he
was fired.
On June 30, the Merrill Lynch
investment counselor, who has since
been fired, returned the $1.4 million
to Levin so that the loss would not
show up in the city's budget. The next
day, Levin gave the money back to
the Merrill Lynch representative for

"He (Levin) is definitely being
made a scapegoat," Russell said.
"Marc was singled out of all the
employes. All of his action had the
approval of his immediate superior."
LEVIN'S immediate superiors
were former City Controller Lauren
Jedele, who retired after the contro-
versy, and Assistant City Controller
Steven Hendel, who was demoted for
90 days. Assistant Administrator for
Finance, Patrick Kenney, was repri-
Administrator Murray said in a
September report explaining the
controversy that he took full respon-
sibility, saying he "failed to imple-
ment adequate controls which would
ensure that he had knowledge of any
unauthorized departures from ap-
proved investment practices."
"There are statements in that
report that Mr. Levin and I will raise
questions about," Russell said. "It's
our position that he (Murray) knew,
or should have known. This thing
could not go on without the knowl-
edge of higher city officials. He
(Levin) had very little voice in this."
ACTING CITY Attorney Bruce
Laidlaw, however, said yesterday, "I
think it will be quickly revealed that
Marc was not just some low-level
accountant who did what he was told.

He could transfer millions of dollars
just by picking up the phone."
Responding to Russell's charges
that the appeals board would be
biased since all the members were
picked by Murray, Laidlaw said:
"The people were picked in an
attempt to comply with the rule that
they be peers on the level of Marc's."
If the decision of the appeals board
is unsatisfactory to either party, they
may appeal to Murray himself.
Laidlaw said that Murray offered to
waive his final say in the matter, but
Levin declined the offer.
LEVIN HAS BEEN in California
since his ousting. Russell said yester-
day, "Marc is having serious prob-
lems getting a job. His personal life is
in shambles. He's not even eligible
for unemployment right now."
Russell 'said that newspapers
"from New York to California" have
reported Levin's involvement in the
Ann Arbor investment crisis, and he
blames city officials for "blatantly
ignoring the city charter" and publi-
cizing the disciplinary firing.
"Marc is just being screwed,"
Russell said.
"We did not take any steps to
publicize it," Laidlaw responded.
"We did not have a press conference,
a press release or anything."

Historical status for 'U' bldgs.?

AP Photo
PTIAN PRESIDENT Anwar Sadat, right, gives King Hussein of Jordan a traditional embrace before Hussein departs
Cairo for Amman yesterday. Hussein and Sadat were meeting in an effort to repair the rift among Arab nations result-
'om Sadat's peace initiative in the Middle East.

(Continued from Page 1)
WILLIAM STURGIS, assistant to the
financial vice-president, said, "This
really dilutes the value of the (National
Preservation) Register." Sturgis said
that in the case of Barbour-Waterman
there was 16 months of "airing every-
body's views," before the decision was
made to tear the building down.

Review Board member and Archi-
tecture Prof. Kingsbury Marzolf, who
abstained from the vote, called the pro-
posal significant only for its "nuiscance
value." Marzolf said that although the
measures would be "less restrictive
than they (University officials) think it
will be," the University will have go
through the review process to obtain

approval for most of its projects.
Washo agreed with Marzolf's predic-
tion. "This changes absolutely
nothing," he said.
State and federal laws already re-
quire owners to show that money from
the government will not damage
buildings on or eligible for the National

Vote brings variety to LSA-SG
(Continued from Page 1)

CAIRO (AP)-King Hussein, trying to mediate the Arab
dispute over President Anwar Sadat's peace overtures to
Israel, unexpectedly returned to Jordan yesterday after his
talks with Sadat were cut short.
Syrian President Hafez Assad, meanwhile, toured the
Persian Gulf trying to get Sadat's bankrollers to use financial
pressure to stifle the Egyptian leader's one-man peace cam-
IN BRUSSELS, Belgium, Secretary of State Cyrus Vance
said before leaving on his own Middle East tour that Sadat's
planned Cairo peace talks next week could lead to "an
agreement in principle covering a comprehensive settlement."
He said Washington and Moscow are deeply divided over
the talks. "I do not believe they (the Russians) would support
in any way the Cairo conference," he said.
Vance, who spoke with reporters at the end of a meeting of
Atlantic alliance foreign ministers, was scheduled to arrive
ein Cairo late yesterday,
Sadat and Hussein met for 2 hours Thursday night, and
Egyptian newspapers and Jordanian diplomats said the talks
were to resume yesterday, but 10 minutes after a grim-
Slooking Sadat arrived at Kuoben P'alace for the expected
meeting, the two rode off to Cairo airport and the Jordanian
monarch flew home.
THIS PROMPTED speculation that Hussein's mission
had failed, at least for the moment. He had met Wednesday
with Syria's Assad with no apparent results.
Assad arrived in Kuwait yesterday from Riyadh, where
he met Thursday with King Khaled of Saudi Arabia and
Crown Prince Fahd, the Saudi prime minister. Saudi Arabia
is the chief contributor of oil wealth to impoverished Egypt.
There was no indication the Syrian president had suc-
ceeded in getting Khaled and Fahd to put pressure on Sadat
by threatening to cut off their crucial financial support.
After Assad departed, the Saudi information minister,
Mohammed Abdo Yamani, said King Khaled has "expressed
hope that Allah will help the Arabs reunify their ranks and
achieve their aspirations."
The Syrian president was going today to Qatar, another
oil-rich state on the Persian Gulf.
A leading Egyptian newspaper editor who accompanied
Sadat on his historic trip to Jerusalem told a news conference

"I HAVE READ letters between President Sadat and
King Khaled," said Moussa Sabri, editor-in-chief of Al Akh-
bar. "I know that there were many contacts between
President Sadat and Saudi Arabia. Saudi Arabia is backing
the visit. So are Kuwait, the Gulf coast, Sudan, the Emirates,
Morocco and Tunisia."
"Syria will come back with Egypt because there is no
alternative," the editor commented. "If the Syrians want to
make war, they can't alone. If they are struggling for peace,
we are struggling for peace."
Hussein, attempting to breach the gap between Assad and
Sadat, came to Cairo Thursday from Damascus. The Syrian
government press and radio reported he failed to shake
Assad's opposition to the direct Israeli-Egyptian dialogue
engineered by Sadat. '
The king had been expected to follow Assad to Riyadh, but
instead he went home to Amman. There was no explanation,
and it was not known if he might go to Saudi Arabia later.
Preparations continued for the second stage of Sadat's
peace initiative-talks opening in Cairo Wednesday between
Egypt and Israel, along with U.S. and United Nations
representatives, to make preparations for a general Arab-
Israeli peace conference in Geneva.
UNCONFIRMED reports said Hussein might send an ob-
server to the conference, but informed sources said he would
hesitate to do so if that would threaten his relations with
Another mediator trying to bring Sadat and Assad
together asgain, U.S. Secretary of State Cyrus Vance, flew to
Cairo yesterday from a NATO meeting in Brussels. Officials
said he was able to arouse only lukewarm support among
America's European allies for the Egyptian-Israeli peace ef-
The Soviet Union, criticized by Washington this week for
refusing to attend the Cairo peace talks, lashed back at the
United States. Tass, the official Soviet news agency, said
Vance's efforts to make the Cairo meeting a success were "in
direct contradiction" to the recent joint Soviet-American
declaration on the Middle East, "which says Geneva talks
must be held before the end of the year."

Irving Freeman, who ran with the For-
ces of Goodness and Niceness party.
"I look at this from a student govern-
ment orientation rather than an
academic one," he said, adding that his
first goal is to rewrite the LSA Election
Earlier, however, Freeman de-
scribed his candidacy in a different
light: "I didn't run for the seat; I ran
for the (election) subsidy. I wanted
LSA-SG to pay me to put out a sheet on
PESC," he said, referring to his alleg-
edly slanderous campaign material
against the Program for Educational
and Social Change party.
Victorious independent candidate
Katherine Friedman espouses a view
somewhere between Freeman's and
Stechuk's. She is urging "a combina-
tion" of both academic action and some
changes in the student government
aspects of LSA-SG. "I'd like to see stu-
dent government as powerful as it was
in the 60's," Friedman said. She voiced
a desire for action on issues such as the
distribution requirement, too.

Spirnak called money matters his first
concern. Though he said he plans "not
to forget the student," Spirnak's priori-
ty is to review the LSA-SG budget and
see where the funds from each stu-
dent's mandatory 50-cent donation are
Spirnak and Freeman are pressing
their suit against the election even
though they won seats. Freeman ad-
mits that because of his victory, he
might have a difficult time proving that
the alleged election violations had
harmed his campaign.
The suit, which names Assistant
Election Director Michael Harwood
and LSA-SG itself as co-defendants with
Election Director Yemen, seeks to in-
validate the election and force Yemen,
Harwood and LSA-SG to pay fines of
$200, $100 and $600 respectively to the
igjured parties.
YEMEN, who said Thursday he
"can't anticipate the outcome of the
suit," reacted succinctly to the
suggestion that he might be fined. He
said: "Bull."
The suit will be decided by the LSA
Adademic Judiciary, a non-political

body of seven students appointed by
LSA-SG primarily to consider cases of
academic misconduct. Judiciary Chair-
man Steve Diamond said: "We
generally hear cases of plagiarism,
cheating and falsification of records -
violations of the academic code of con-
duct. Almost never do we get involved
in anything like this."
Diamond said the case probably will
not be decided until January. The elec-
tion results, he added, will stand until
IN ADDITION to the candidates,
three constitutional amendments were
on the ballot to complete a month long
reorganization of LSA-SG. All three
passed by considerable margins.
The amendments serve to reduce the
power of the president, and reduce the
quorum required to transact business.
at meetings.
Other aspects of the reorganization,
according to LSA-SG President Dick
Brazee, were designed to increase the
visibility and credibility of LSA-SG and
promote alternative educational
programs in the college.

Conferees in House and Senate
agree on, payroll tax increases

When Life goes
'to the movies,you'II
pictures that werl
never on the screc


r .
a .




WASHINGTON (AP) - House and
Senate conferees working on legisla-
tion to keep the Social Security sys-
tem solvent broke up in deadlock last
night over an unrelated issue after
agreeing on payroll tax increases
that would, within a decade, more
than triple the maximum amount
any worker could pay.
A Senate rider to- provide tax
credits of up to $250 for higher educa-
tion tuition was the issue that
stymied efforts to pass legislation
this year.
THE SYSTEM that pays benefits to
37 million persons and collects taxes
from 108 million workers is threat-
ened with exhaustion of its reserves
within five years.
Senate conferees unanimously in-
sisted on the tuition payment plan
and House conferees were as ada-
mantly opposed.
Sen. Russell Long, (D-La.), the
conference chairman, set no date for
returning to the negotiating table,
saying he would await word from the
House members.
"THE BILL IS not dead, it is only
sleeping," he said.

The agreement on the payroll tax
increases followed intense pressure
from the White House and the
congressional leadership to bring a
Social Security funding bill to a vote
before Congress adjourns for the
year. Whether a vote will occur this
year in light of the deadlock is uncer-
tain. Originally, Congress was sched-
uled to vote on the bill next week.
The maximum paid equally by
workers and their employers cur-
rently is $965.25 per year.
would set the 1987 figure at $3,046.
However, the ceiling would apply
only to those earning at least $42,600.
If the present law were left un-
changed, the maximum tax in 1987
would be $2,012.
The bill would raise Social Security
taxes a total $227.3 billion from 1979
through 1987.
Under the compromise, there
would be no Social Security tax
increases next year beyond those
already provided for under existing
law, which raises the maximum tax
to $1,071 in 1978.
THE CONFEREES also agreed to
increase substantially the amount
retired persons might earn without
losing part of their Social Security

earnings limit would go to $4,000 next
year and increase in $500 increments
to 1$6,000 in 1982. After that, the auto-
matic adjustments would resume.
The increase, however, would apply
only to those 65 or older. Persons re-
tiring at earlier ages would continue
to be covered by existing law.
THE. PANEL ALSO dropped a
Senate proposal, supported by the
Carter administration, that would
have levied higher taxes on employ-
ers than on employes. Also dropped
in the compromise was a House
provision 'for loans from the general
treasury when Social Security re-
serves run low.
The propoAl to provide tax credits
for tuition would cost the govern-
ment about $1.2 billion a year.
That was one of two unrelated pro-
visions tacked onto the Social Secur-
ity legislation. However, the confer-
ees had reached a compromise on a
series of unrelated welfare amend-
ments. The key element of that com-
promise is an immediate $187 million
federal grant to help states, cities
and counties pay their welfare costs.
Sen. William Roth, (R-Del.), spon-
sor of the tuition tax credit proposal,
challenged the House conferees to let
the full House vote on it without their

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