Sw A Daitr LABOR'S WALKOUT See Page 4 Latest Deadline in the State r* CLOUDY, COLDER EIGHT PAGES Within R 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 :.