Page 12-Wednesday, July 26, 1978-The Michigan Daily
SANTIAGO, Chile (AP) - Ten air
force generals resigned yesterday in
solidarity with their deposed comman-
der, Gen. Gustavo Leigh, ousted Mon-
oday from both his air force post and the
ruling military junta. .
C The 10 men joined eight other
C n lean generals who retired Monday rather
than take over Leigh's command and
his position in the four-man junta.
ISPRESIDENT Augusto Pinochet
# ousted the 57-year-old Leight, most
liberal member of the ruling group.
Leigh had publicly criticized Pinochet's
policies and called for a return to
civilian democracy.
It was the first change in the for-
overthrew elected President Salvador
Allende, a Marxist, on Sept. 11, 1973.
Gen. Fernando Matthei, 53, the health
minister, was named to replace Leigh.
BRIG, GEN. Hernan del Rio Kowol
told journalists that he and the nine
other generals, severeal said to be air
base commanders, were resigning
voluntarily.
In response to the move, nine
colonels were elevated to brigadier
general, and Gen. Javier Lopetegui
Torre was made chief of staff, accor-
ding to an official announcement.
The government announced Monday
that Leigh was being "disqualified"
because he had repeatedly neglected
"the nrincinlesand n iS tha
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spired the military movement of 1973."
LEIGH HAS been publicly
disagreeing with Pinochet's policies for
more than a year, but the catalyst for
his ouster was an interview he gave last
week to an Italian newspaper reporter.
He demanded that Pinochet end cen-
sorship of the press, restore the ih-
dependence of the judiciary and right of
habeas corpus, divide executive and
legislative powers and set a timetable
for elections.
The country remained quiet. Leigh
said he planned to challenge his ouster
in court.
Besides Pinochet and Matthei, the
junta members are navy commander
Adm. Jose Merino and Gen. Cesar
Mendoza, chief of the national police.
House
panel
OK's
tax break
WASHINGTON (AP) - The House
Ways and Means Committee voted
yesterday to exempt from income taxes
any increases in property values
caused by inflation.
The action could end a three-month
stalemate and clear the way' for com-
mittee action on an across-the-board
tax reduction for individuals and
businesses. But that is far from certain
because of efforts to further reduce
federal taxes on capital gains, which
are profits from the sale of assets held
for a year or more.
The panel earlier in the day refused
to vote an income-tax credit to help of-
fset the higher Social Security taxes
that take effect next year. And it rejec-
ted an effort to limit business deduc-
tions for what President Carter has
called "the three-martini lunch."
BY A 21-16 VOTE, the committee ap-
proved an amendment by Rep. William
Archer, (R-Tex.), that seeks to ensure
that a piece of property whose value is
pushed up by inflation is not taxed as if
the gain were real.
It was not clear whether the commit-
tee would treat the Archer plan as an
alternative to broader reductions in
capital-gains taxes or as an addition to
such tax relief.
But Rep. James Jones, (D-Okla.),
sponsor of the most popular capital-
gains bill, told reporters he does not see
the Archer vote as a challenge to his
own tax package.
THE CAPITAL-GAINS issue, the
most difficult facing the committee,
has blocked tax-action since April. A
majority of the 37-member panel ap-
parently favors the Jonesrbill, which
seeks to provide greater incentive to
investors by cutting the tax on capital
gains. Rep. Al Ullman, (D-Ore.),
chairman of the committee, insists that
the panel resolve the taxation of capital
gains issue before moving on to other
tax issues.
Carter opposes the Jones measure on
grounds that the great majority of the
tax benefit would go to Americans ear-
ning $100,000 a year or more.
Current law allows preferential tax
treatment for capital gains, such as
profits from the sale of stock or land
owned for a year or more.
In many cases, Archer contended, the
"profit" is illusory - due more to in-
flation than toa real increase in value.