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LABOR'S WALKOUT
See Page 4
Latest Deadline in the State
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CLOUDY, COLDER
EIGHT PAGES
Within
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VOL. LXI, No. 103
ANN ARBOR, MICHIGAN, SUNDAY, MARCH 4, 1951
Senator Asks
For Abolition
Of RFC Plan
Agency Called
Corrupt by Kem
WASHINGTON -(/P)- Senator
Kem (R-Mo.) called the Recon-
struction Finance Corporation
"corrupt" yesterday and demanded
that Congress abolish it.
He declared President Truman is
'0apparently unwilling to clean up"
the agency.
* * *
THE MISSOURI lawmaker said
in a statement the RFC has "sur-
vived its usefulness" and should be
put out of business "lock, stock
%nd barrel."
The current investigation of
the RFC by a Senate Banking
Subcommittee has made it clear,
Kem said, that "as a result of
political pressure many unsound
loans in large amounts" have
been made by the agency. He
added that "the people take the
loss."
Kem's blast came against a
background of reports that Tru-
man may be thinking of running
for Kem's Senate seat next year.
Truman was a senator from Mis-
souri for 10 years before he be-
came Vice President and then
President.
* * *
U.S. Announces
New Bond Issue
WASHINGTON-(AP)-The U. S. Treasury and the Federal Reserve
Board last night announced a settlement of their fight over ways to
halt inflation.
It calls for issuance by the Treasury of billions of dollars of a
new type of none-marketable bonds, bearing more interest than the
old type.
8* s * *
THE HOPE WAS EXPRESSED that banks, insurance companies
and other lending institutions would exchange these bonds for certain
outstanding treasury issues. The outstanding issues in question total
$19,000,000,000, but it is not expected that all of them will be ex-
changed because the bonds cannot be cashed until maturity. The idea
is that curbs will thus be placed on
Y.Nine
Smash
to,
Miles
of
o ngehor
n
KEM EXPRESSED his views as
Federal income tax collectors took
a hand in the subcommittee's in-
quiry into alleged "favoritism and
influence" in the granting of RFC
loans.
Senator Fulbright (D-Ark.),
the subcommittee chairman, said
the Internal Revenue Bureau has
asked for transcripts of all testi-
mony in the investigation.
Fulbright said the request will be
met. The sub-committee has been
exploring the income of E. Merl
Young, husband of a White House
. stenographer, and others. Young
has testified to borrowing thou-
sands of dollars from 'various
sources. He has denied that these
were payments for exercising in-
fluence or providing entree to the
White House or the RFC.
IN A RECENT REPORT, the
subcommittee charged that three
RFC directors had yielded to out-
side influence in approving loans.
The report also said White House
aide Donald Dawson, among
others, appeared to have exerted
influence on the RFC.
Truman called the report asi-
nine. Later, however, he recom-
mended to Congress that the RFC's
five man board of directors be re-
placed by a single administrator.
The subcommittee, in its report,
had made a similar recommenda-
tion.
Labor Action
AProbe Asked
By Senator
WASHINGTON --(M)- Senator
Humphrey (D-Minn.) announced
yesterday his labor subcommittee
will launch an investigation Tues-
day into labor leaders' walkout
from the mobilization program
which has brought fears of a na-
tional crisis.
On the same day, he was advised,
Mobilization Director Charles E.
Wilson will be in Key West, Fla.,
to confer with President Truman
who went there Friday on a vaca-
tion.
* * *
THEIR TALK presumably will
deal with the labor action, Hum-
phrey told reporters, because "that
certainly is the issue of paramount
importance."
If so, this might indicate the
Administration or Wilson him-
self takes a graver view of the
trouble than President Truman
indicated on Thursday when he
said that it is not very serious;
just a disagreement.
Humphrey, who talked with Tru-
man about the situation Thursday,
said he got the impression that
Truman felt it would work itself
out.
IN ANOTHER controls develop-
ment yesterday, the Government
I d 4 . -nif m nm+-- niin rt r
ReiNew
WageBoost
Ford, Chrysler,
Action Expected
DETROIT-P)-General Mo-
tors Corp. agreed yesterday to give
its 350,000 production workers a
five-cent hourly cost -of -living
wage boost.
There had been some question as
to whether the employes would
get four or five cents under the
latest consumers price index pub-
lished by the Bureau of Labor
Statistics.
* * *
GENERAL MOTORS' move, an-
nounced after a conference with
C1O United Auto Workers officials,
is expected to lead to similar action
by Ford, Chrysler and several
smaller firms which have escalator
wage contracts with the Union.
About 1,000,000 UAW members are
covered by such pacts.
But UAW President Walter
Reuther meanwhile announced
that the union would welcome a
rollback of wages to pre-Korean
war levels if prices were pegged
tightly at the same mark.
By agreeing to give its employes
five cents, General Motors accept-
ed a revised BLS index. This one
included rental costs on new homes
and other factors not included in
the so-called official index.
* s * 8*
THE RAISE, based on the Jan.
15 index and effective immediate-
ly, brings total wage gains of GM
employes to 17 cents an hour since
January, 1950. But one quarterly
adjustment lopped two cents off
their pay last March, leaving a net
gain of 15 cents. This includes a
guaranteed four-cent "productivi-
ty" raise last May.
Economic Stabilizer Eric John-
ston has approved wage gains un-
der escalator clauses at least until
June 30, regardless of whether they
exceed the 10 per cent formula.
UAW officers will confer with
Ford officials Tuesday on the four-
or five-cent issue and with other
companies during the week.
Reuther's willingness to accept a
wage rollback was voiced in a let-
ter to Sen. James Murray, (D-
Mont.), chairman of the Senate
Labor and Welfare Committee. He
asked the committee to hold pub-
lic hearings on the entire prob-
lem of inflation "and its relation-
ship to defense mobilization."
WAGE-PRICE FIGHT:
inflationary tendencies.
The bonds, bearing two and
three-quarter per cent interest,
payable semi-annually, will be
offered in exchange for out-
standing two-and-one-half per
cent Treasury bonds maturing
June 15 and Dec. 15, 1967-72.
Secretary of the Treasury John
Snyder and Chairman Thomas
McCabe of the Federal Reserve
System issued this statement:
"The Treasury and the Federal
Reserve System have reached full
accord with respect to debt-man-
agement and monetary policies to
be pursued in furthering their
common purpose to assure the suc-
cessful financing of the Govern-
ment's requirements and, at the
same time, to minimize monetiza-
tion of the public debt."
* * *
AT KEY WEST President Tru-
man said he was "highly gratified
at this agreement, which repre-
sents a very important step for-
ward."
A strenuous row had been going
on between Snyder and a majority
of the Federal Reserve Open Mar-
ket Committee, which has been
supporting government bonds at
par by standing ready to buy them
when necessary.
The Federal Reserve men and
many economists have wanted to
change this support policy, say-
ing it fans the flames of infla-
tion.
They have argued that if banks
can depend on cashing in their
bonds at par or better whenever
they desire that means huge sums
are available for inflationary lend-
ing.
They advocated stopping the
support-operations and letting the
bond find their own level in the
market. But if these went down, it
would mean in effect an increase
in interest rates.
Sec. Snyder has opposed letting
them drop. One of his reasons was
that the Government's interest
costs would rise more than $1 bil-
lion a year.
Draft Showdown
Due Tomorrow
WASHINGTON - (P) - Just
ahead of a Senate draft age show-
down, slated for tomorrow, Chair-
man Vinson (D-Ga.) of the House
Armed Services Committee spoke
out against conscripting men un-
der 18 and one half, contending it
is not justified.
However, confident Senators
battling to retain the 18-year pro-
posal sought to line up 55 to 65
votes among the 96 members in
an effort to roll up an impressive
total on the first test vote.
Nationalists
Tell of Vast
Red Purge
By The Associated Press
The Chinese Nationalist De-
fense Ministry in Formosa de-
clared last night that 1,000,000
persons already have been massa-
cred on the mainland in the cur-
rent Communist blood purge.
It said a total of 25,000,000 were
marked for slaughter,
* * *
THE STATEMENT, issued by
the ministry's information service,
also declared the Nationalist re-
turn to the continent was only a
matter of time and that the Reds
were ready to abandon South
China whenever it occurred.
The Ministry alleged that de-
pendents of top Red officials al-
ready were moving north from
Canton and that Reds were
shifting their private capital to
British Hong Kong.
The statement continued that
with the shift of Communist
strength to Korea, only four Red
armies (120,000 to 160,000 men)
remained in South China's vital
Kwangtung and Kwangsi provin-
ces. These relatively small forces
cannot be reinforced because
large numbers of troops are need-
ed to hold other provinces, the
statement said.
4' * * *
THE NATIONALIST Ministry
predicted that opposition to a Na-
tionalist landing would be "very
light" but conceded that the Red
program was to abandon South
China only if necessary, and not
unconditionally.
From Hong Kong have come
similar reports of bloodshed.
Arrivals there from faraway
Manchuria, within echo of the
Korean war, say jails and special
prison camps are jammed and
execution teams are constantly
busy.
Besides Hong Kong, the nearby
Portuguese colony of Macao has
produced similar stories from
refugees who have sneaked out of
Red China when they learned
their names were "on the list."
As such Communist programs
as land redistribution are pushed,
conditions worsen. Landowners,
big and little, are reported resist-
ing the redistribution despite ter-
rible personal peril.
World News
Roundup
By The Associated Press
PARIS-Socialist Guy Mollet,
46-year-old former school teacher
from the northern mine fields,
agreed yesterday to try to solve
France's cabinet crisis but bis
chances did not appear good.
* * *
NEW YORK-Soviet Deputy
ForeignMinister Jacob Malik in-
dicated yesterday he has broken
off further talks with American
Ambassador John Dulles on a
Japanese peace treaty.
* * *
WASHINGTON-America, is in
"greater internal security danger
than it has ever been," Sen. Patrick
McCarran (D-Nev.) said yesterday
after talking to FBI Director J.
Edgar Hoover.
* * *
GRAND RAPIDS-Sen. Ar-
thur Vandenberg's condition re-
mained unchanged yesterday, his
physician, Dr. A. B. Smith, said.
WASHINGTON-The Air Force
yesterday announced the start of
a general rotation program of per-
sonnel in the Far East May 1.
* * *
NEW YORK - The United
States yesterday offered again to
let the United Nationnscount its
-Daly-Jack Bergstrom
"HEY, NOT THERE!'"-Vigilant Union pool attendants shouted just in time to prevent overzealous
Sailing Club members from launching their dinghy in the chlorinated waters of the Union. Undis-
-couraged, the sailors hauled the craft upstairs to the ballroom where it will be the center of the
club's exhibit at the Activities Carnival tonight.
___________ . * *
Subzero Cold,
i I
Raging Snow
Hit Midwest
By The Associated Press
Subzero cold bore down on parts
of the midcontinent yesterday-
an area still crippled by two big
blizzards in a week.
The twin storms, worst of the
winter in the upper Midwest area,
buried parts of a six-state area
under a paralyzing blanket of
snow. Gale-force winds and ice
storms added to the hardship in
the weather-stricken area.
* * *
DRIFTS RANGING up to eight
feet deep halted or snarled high-
way travel in parts of the Dakotas,
Minnesota, Wisconsin, Michigan
and Iowa.
Some towns were isolated,
small buildings collapsed under
the crushing weight of the snow
and communications lines were
disrupted.
Hardest hit areas were South
Dakota, Minnesota and Northwest
Iowa.
HIGHWAYS WERE lined with
abandoned cars in South Dakota.
Motorists sought refuge in small
towns or farm houses. Virtually all
bus and highway travel was halted
temporarily in the state.
A northwest gale toppled 50 tele-
phone poles in the Muskegon,
Mich., area. Service was disrupted
to three cities.
New Carnival To Rise
From Ashes of Smoker
Troops Meet
Stiff Enemy
Resistance
Bayonets Shatter
N. Korean Force
TOKYO -- (R) - U.S. Marines
stabbed at the Chinese Red Army
in its Central Korean mountain
lair today, driving within nine
miles of the Red headquarters
town of Hongchon.
The Leatherneck infantry and
tanks, moving north from Allied-
held Hoengsong along a narrow
canyon road, were running into
moderate-to-heavy resistance.
HONGCHON, headquarters of
the Chinese 66th Army, is the cen-
ter of an important road network
See MAP page 8
that the Reds need to mount their
threatened spring offensive. Ilt
is 22 miles south of the 38th Par-
allel.
While the Marines advanced
in the center, artillery fire and
bayonet-charging infantrymen
of the U.S. Seventh Division
farther east completely shattered
one North Korean Communisi
division yesterday.
British and South Korean troops
slashed forward with a bayonet
action to gain more than a mile
yesterday in the Ninth Corps sec-
tor, west of Hoengsong-key cen-
ter position in the Allied line.
* * *
HEAVY FIGHTING also raged
on the far eastern end of the
United Nations line, in the wil-
derness five miles northwest of
Pangnim.
There, U.S. Seventh Division
troops pulled a classic one-two
punch against some 3,000 Reds
of the North Korean Third
Corps.
The Reds charged through a
deadly barrage of 3,000 rounds of
artillery shells. Many fell but
about 500 reached the top of Hill
980. There they were met by a
battalion of U.S. infantrymen
with fixed bayonets who charged
down the slope.
As the bayonets found their
:..marks, the surviving Reds broke
in disorder and fled to the north,
field dispatches said.
At the same time, other troops
of the Seventh Division advanced
up to 4,000 yards (more than two
miles) and seized key positions
three miles south of Changdong
-a North Korean assembly area.
In the center of the line, north
of captured Hoengsong, U.S. Mar-
ines brushed through light resist-
ance as they moved ahead more
than two miles northeast.
Expect New
Red 'Big Four'
Peace Plans
PARIS--()-Western diplomats
speculated yesterday that Russia
may suggest a peace pact with
Communist China and a peace
treaty with Germany at tomor-
row's Big Four Deputies Confer-
ence.
Another old male tradition will
pass into oblivion tonight when
the Union and League sponsor an
all-campus Activities Carnival.
Until today a male stronghold
known as a "smoker," the new
version of the annual carnival
will present the men and women
of the University with a compre-
hensive look into the workings of
23 campus organizations. The 23
City Council
Will Discuss
Zoning Plan
T h r~ e e controversial amend-
ments to Ann Arbor's proposed
zoning law will be discussed at
7:15 p.m. tomorrow at an open
meeting of the Common Cduncil
in City Hall.
First on the schedule is an
amendment to ease the 90-day
restriction on nine fraternities
which will be left outside of the
proposed A-i fraternity-sorority
zone. Under this amendment the
rule which makes operation of
these houses illegal, if they are
left vacant for more than 90 days,
will be discontinued in case of
national emergency.
Amendments to include cooper-
ative houses in the A-i zone as
well as to extend its boundaries
will also be discussed.
represent all kinds of male and
female membership - from Pan
Hellenic Association to Alpha Phi
Omega, the national Boy Scout
fraternity.
IGNORING THE mildly revolu-
tionary aspect of the affair, mem-
bers of the groups worked uncon-
cernedly last night in the Union
Ballroom erecting booths and ex-
hibits designed tobsnare the in-
terests of would-be BMOC's and
women.
Recognizing the distinctive
problems presented by t h e
switch Union and League gU~
cials plan to have dancing in
the nearby Terrace Room along
with several acts from Gulan-
tics and Union Operas.
Union Councilman Jim Moran,
'52, explained the "concession" as
the "necessary result of probable
mobilization."
*' * *
MORAN SEEMED to be worried
over one possible result of the
change. Voicing concern over the
non-organizational aspects of the
affair, he said "the entertainment
and the dancing might detract
from the prime purpose ,of the
event."
At the old smokers, he pointed
out, either you smoked or in-
vestigated organizations. But
now-
"Well, you never can tell," he
shrugged, "it might be an enjoy-
able evening."
Stabilization Program
Viewed by Economists
By HARLAN BRITZ
The problem of sacrifices and
who should make them has been
listed as the central dispute over
wage stabilization, by three mem-
bers of the economics department,
Prof. William Palmer, Thomas
Gies and William Zentz.
As more income in devoted to
wartime uses, there is less avail-
able for other purposes, according
to Gies. If the amount of income
remains practically stable, there
will be less available for civilian
use. At present, labor and man-
agement are both maneuvering to
make less sacrifice than the other,
he said.
* * *
as a whole should then decide.
(It has been argued by labor
leaders in the past few days
that they have not been given
enough voice in the program;
that the program favors big
business, and is unfair.)
Two flaws in the present agree-
ments were pointed out by Zentz.
He claimed that the ruling allow-
ing escalator clauses signed before
the wage freeze date of Jan. 25,
by their definition exclude those
workers not covered by escalator
clauses.
* * ,*
THESE WORKERS are not al-
lowed to receive wage increases of
more than ten percent above' the
CHORAL UNION SERIES:
Kubelik To Make Ann Arbor Debut
'-4.>
. * *
Rafael Kubelik who will conduct
the Chicago Symphony Orchestra
at 8:30 p.m. today in Hill Auditor-
ium will be making his initial Ann
Arbor appearance.
But the name Kubelik is not
entirely unfamiliar to Ann Arbor
concert-goers. In earlier days
the conductor's father. Jan Kube-
ducted such orchestras as the
Czech Philharmonic, the Paris
Conservatoire Orchestra and the
famous Concertgewbouw of Ams-
terdam.
THIIE CHICAGO Symphony's
program for today's concert in-
cludes: "Overture to 'The School
Aware the Soviets nearly alw
stage surprises at internati o
gatherings, they think that P2
may be no exception..
The "World Council of Peac
which met recently in Berlin, urj
the four great powers to me
peace with China and in Pa
yesterday the Politburo of
I :.