THE Summer Daily 111r111 Edito/ of TiF 51Mf lIGAN DAI Y Edited and managed by students at the University of Michigan Soturday, Juiy 14, 1973 News Phone: 764-0552 Senate committee vote commendable THE REJECTION OF G. McMurtie Godley by the Senate Foreign Relations Committee is commendable be- cause the nominee was undesireable for the recommend- ed position and also because the action was a reassertion of the Senate's constitutional powers. Godley was nominated by President Nixon for as- sitant secretary for far eastern affairs. The rejection apparently is the first decision of this kind by the For- eign Relations Committee nn a key'nomination by any administration. According to the committee chairman, Sen. William Fulbright (D-Ark.), Godley showed too much enthusiasm for U. S. military involvement in Southeast Asia. THE WHITE HOUSE, as was to be expected, was aghast at the committee's action. They believe Godley was rejected not'on his qualifications as a Foreign Service of- ficer, but rather because he was executing a policy un- popular with the committee., Godley was deeply involved in the secret fighting in Laos. He headed an American operation that involved the use of Central Intelligence Agency commanders with a clandestine army. In addition, Godley was instrumental in the determination of bombing targets in Laos, a posi- tion he spparently relished. But, as University Prof. Allan Whiting said, Godley was in some degree responsible for a secret war and the creation of 700,000 refugees. "IT IS INCONCEIVABLE that Godley's activities in Laos could be irrelevant to this appointment," Whiting said. He stated that the consideration of politics in For- eign Service appointments is "long overdue." This, in itself. is sufficient to reject Godley, Military strategists, disguised as Foreign Service officials, are not needed to develop our far eastern policy. But, equally imnortant, the rejection of Godley dem- onstrates that the Foreign Relations committee is reas- serting its responsibilities in foreign affairs. While the President is allowed to develop foreign relations, only Congress has the power to declare war, But the evidence shows conclusively that the Presiden has decided to pre-empt this power of Congress. His bombing of North and South Vietnam and in Cambodia without permission of Congress are evidence of this fact. Indeed, there is no better example of this unconstitution- al activity than the ''scret war" in Laos, in which God- ley was so deeoly tn olved. Since the President ignored the votes in Congress to directly end the bombing. Congress has had to respond indirectly. First, the President was forced to set a cut-off date for the bombing of Cambodia. And now to make the message even more clear, a Presidential appointment has been blocked. The committee's rejection of Godley now shows that the actions of a diplomat will be considered in further appointments. And it further demonstrated that the Con- gress is serious in its efforts to restore its constitutional war-making powers. a--. LI A } " TH. . ..., - ..: AM ., qS .. N.v u.t f 7 1. .1.1 i1S'5 MVWJAY WE C AOCOVJER ULP *" 6I5 OIL$ATE 1ThNr Major oil companies make most of the controversial gasoline shortage By DAVID STOLL A FEDERAL Trade Commission (FTC) report made public last week charges that the major pe- troleum companies have used the well-publicized but yet-to-be-proven gasoline shortage "as an occasion to debilitate, if not eradicate, the independent marketing sector." The report stated that 1,200 in- dependent gasoline stations have closed in the first five months of this year. In the midst of the alleged gaso- line shortage, the major petroleum companies have called for t a x breaks, higher prices for gasoline IN THE oligopolistic oil industry, it is much more profitable for the big companies to cooperate w : t h each other than to compete. 13y concerted shifts in pricing and supply arrangements, they try to cut smaller companies out of busi- ness. - The infamous oil depletion allow- ance, intended to encourage es ploration for new sources of oil, has long rebounded to the benefit of the majors. The law, in effect, encourages integrated companies to declare their profits on the crude oil phase of their operations In the oligopolistic oil industry, it is much more profitable for the big companies to co- operate with each other than to compete. By concerted shifts in pricing and supply arrange- ments, they try to cut smaller companies out of business. tailers, ostensibly because of t h e gas shortage. Yet several majors are proceeding with plans to set tip their own new discount brands. The war of the majors against the independents, combined with their self-serving solutions to the alleged gasoline crisis, raises the question of whether a shortage exists at all. FOR EXAMPLE, while the maj- ors point to a lack of national re- fining capacity as one of the rea- sons for the shortage, independent refineries say they are operating at only 50 to 60 per cent capacity. And the revelation by the FTC of serious under-reporting of na- tural gas reserves by petroleum companies casts further doubt on their petroleum reserves reports. What is certain is that the major oil companies are reaping benefits from the "crisis." Oil industry spokespersons have noted with satisfaction that prices have "stabilized" in recent months, usually at prices higher than be- fore. Gas prices in the Detroit area are reported to be about 6c per gal- ton higher than at the same time last year. THE PROFITS of Standard Oil Co. of Indiana in its Michigan marketing area have doubled, from two to four percent, in the last year. Majors' profits, it should be remembered, traditionaly come from crude oil operations. Because of such facts, and prompted by the FTC study, the Cost of Living Council announced and natural gas, "more realistic" environmental legislation, and con- struction of the ecologically con- troversial Alaskan pipeline. The major petroleum companies claim that these moves - which would divert billions more of the national income into their pockets - are required due to increasing demand for their products. Although the United States may soon face an energy crisis of mon- umental proportions, there is little doubt that the big petroleum cor- porations are managing to parlay the present "crisis" into a more profitable future for themselves. SPECIFICALLY, the majors -- the large integrated producers who control their own oil from the fields to the refineries . and fin- ally to the gas pumps - are using the occasion to declare war on the smaller independents. Together the eight largest com- panies hold 64 per cent of the na- tion's proved crude oil reserves, 58 percent of its crude refining capaz- ity and sell 55 percent of its gasoline. Independent refineries and retail-r ers depend on such majors for a large share of their crude oil and gasoline. Independents, however, engage in competitive, price-cutting practi; es inimical to the interest of the larg- er, integrated companies. where they will be taxed at the most advantageous rate. The majors operate their refin- tog and retailing operations, onethe other hand, at a minimal rate of profit or even a loss. Thus inde- pendent refiners are charged an artificially high price for the crude oil they need in order to survive, which, as the FTC report cogently observed, renders their existence "hazardous." . INDEPENDENT refineries al- ways used to get by, however, by trading their government allotied The war of the majors against the inde- pendents, combined with their self-serving solutions to the alleged gasoline crisis, raises the question of whether a shortage exists at all. :{{: - - - . S- - -r...; { r{,f::"%:::.": ir{,; . . ": ^. .,?': rights to import foreign oil, whizh they have no means to transport, to the majors in exchange for the majors' domestic oil. Now that foreign oil has become as expensive as domestic oil and the impitv quota system has been abandoned however, the independents are left without a lever. And, at the same time that the major suppliers are squeezing the independent refineries,- they are also cutting off the independent re- earlier this week that it was launching a major investigation of the petroleum industry and its well- publicized gasoline shortage. In the nation-wide audit the Council plans to investigate supply prac- tices to independent retailers and refineries, and whether, in fact, a gasoline shortage exists. David Stoll is an assistant sight editor of The Daily.