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VOL. LXI, No. 21-S ANN ARBOR, MICHIGAN, THURSDAY, JULY 26, 1951
FOUR PAGES
Jury Indicts
Racketeers
On Contempt
Costello, Adonis,
Erickson Tagged
NEW YORK-WI)-Frank Cos-
tello and two other racket big
shots were indicted on Federal
.contempt charges yesterday.
Costello, h o t a n d nervous,
hopped a subway and turned him-
self in with a plea of innocent.
* * *
A GRAND JURY tagged Cos-
tello, racketeer Joe Adonis and ace
bookie Frank Erickson for their
refusal to answer questions before
the Senate Crime Committee last
March.
Adonis and Erickson are be-
hind bars on gambling charges.
They couldn't answer the con-
tempt charges at once. Costello
was arraigned and then re-
leased on $5,000 bond.
' The Government said it would
press for an early trial of the case.
The 60-year-old racketeer-re-
garded by Senate crime probers as
top man in the American under-
world-had nothing to say to
newsmen.
* * *
IN EACH COUNT of the Grand
Jury's multi-count indictment the
top penalty on conviction is a
year in prison, plus a $1,000 fine-
nine years for Costello, 16 for
Adonis and 74 for the pudgy Erick-
son.
Millions watched on television
last winter as Costello squirmed
and squeaked but stubbornly re-
fused to answer the Senate com-
mittee's questions.
Adonis and Erickson were even
less talkative during their turns
on the witness stand. They ad-
mitted hardly anything.
Adonis, 49 years old, has been
accused of just about every crime
in the book at one time or an-
other-gambling, kidnapping, ex-
tortion, and assault. He supposed-
ly was a figure in Brooklyn's mur-
der, Inc., the old murder-for-hire
gang. But few of the charges
agaist him ever stuck for long.
HE FINALLY was tripped up
in New Jersey and is now serving
two to three years there on gamb-
ling charges.
Erickson, 54 years old, was the
bookie's bookmaker-the gambler
to whom they turned with bets too
big for most operators to handle.
He headed a $12,500,000 a year
gambling empire.
House Re ects
Compromise
HousingBill
WASHINGTON-(A)--By a two-
vote margin, the House yesterday
refused to retreat in its demands
for a big slash in the Administra-
tion's public housing program and
for a cut in the number of Fed-
eral employes.
The chamber voted 188 to 166 to
stand pat on the two economy
moves and to reject a compromise
worked out by a Senate-House
conference committee.
* * *
HOUSE CONFEREES were in-
structed to insist on the original
House decisions as spelled out in
the $6,160,000,000 independent of-
fices appropriations bill. The mea-
sure provides funds for more than
a score of Federal agencies, in-
cluding the Atomic Energy Com-
mission.
Originally, the House had voted
to allow the Public Housing Ad-
ministration to build only 5,000
public housing units this year.
Under the compromise proposed by
the Senate-House conference com-
mittee, the number would have
been increased ten-fold to 50,000
units. President Truman h a d
asked for 75,000.
The conferees had also agreed
on a Senate proposal for cutting
Federal personnel by 10 percent,
instead of the t-ouse provision to
refill only one out of every five
job vacancies.
President Truman had originally
asked Congress to authorize 135,000
housing units in the year starting
July 1, but later cut the number
to 75,000 because of shortages
arising from the Korean War
emergency.
Acheson Issue
DividesGOP
Minority of House GOP Approves
Ouster Move at Strategy Session
WASHINGTON-(P)-House Republicans split wide apart yester-
day in voting 71 to 33 to back legislation designed to oust Secretary of
State Acheson from the Federal payroll.
The vote was taken behind closed doors at a grand strategy session
heralded in advance as a meeting of the entire GOP House roster.
HOWEVER, MORE than 90 Republicans either failed to attend
or refrained from voting. The outcome made it doubtful that the
Agreement
Seen
Imminent
In
Korean
Cease-Fire
Talks
4
Lattimore
Ties Probed
By Senate
WASHINGTON-(P)-A Senate
committee produced evidence yes-
terday that Owen Lattimore, one
time State Department consultant,
urged a Far East research organi-
zation in 1938 to support Soviet
Russia's international policy "with-
out using their slogans."
The disclosure was made at the
start of an investigation into the
Institute of Pacific Relations
(IPR). Senator McCarran (D-
Nev.), presiding at the inquiry
conducted by an Internal Secur-
ity subcommittee, said he aimed
to find out whether "subversive
influences" have affected American
Far Eastern policy.
* * *
THE FIRST witness was Edward
C. Carter, a slender, gray-haired
man who is a trustee of the IPR.
He described himself as a former
edu'cator and vigorously denied he
ever was a Communist.
The examination dealt princi-
pally with Lattimore, now a Johns
Hopkins University professor, and
Frederick Vanderbilt Field, leftist
New York millionaire.
Carter told the Senators that
Field tried without success to
obtain an Army intelligence as-
signment after the United States
entered World War II. He testi-
fied he wrote someone in the
War Department in behalf of
the appointment.
Senator Eastland (D-Miss.) said
a February, 1942, letter from Field
to Carter showed that Lattimore
and Lauchlin Currie, an Admin-
istrative assistant to President
Roosevelt, also recommended Field
for the job.
The letter said "Owen" was tak-
ing the matter up with Currie,
but Carter under questioning said
he didn't know whether Lattimore
and Currie recommended Field for
a commission.
The letter Lattimore wrote on
July 10, 1948 concerning Soviet
policy was produced in photostat
by subcommittee counsel Robert
Morris. It advised the IPR, a pri-
vate organization, how to conduct
its then current Sino-Japanese
survey. It was written to Carter,
then Secretary-General of the
IPR.
Fight Rages
Over Controls
WASHINGTON-(I)-The Ad-
ministration tore into one of the
hottest issues of the economic
controls fight at the opening of
Senate-House Conferences yester-
day.
It sought to keep the right to fix
livestock slaughtering quotas.
Both Houses, in their varying
bills which the conferees are try-
ing to weld into one, denied the
Office of Price Stabilization that
authority. In view of that action
Senator Maybank (D- S.C.), chair-
man of the conference, said there
is some doubt there is any legal
way to restore the power in the
present bill.
@"get-Acheson" drive would succeed
unless it gained strong and unex-
pected Democratic support.
S o m e Southern Democrats
have rallied behind the GOP-led
attack, but Administration lead-
ers said they were confident they
could beat it off when the Re-
publicans make their move,
probably today.
Under GOP strategy-as ap-
proved by a majority of those who
voted at the meeting yesterday-
the showdown will come on -an
amendment offered by Rep. Phil-
lips (R-Calif.) to a $1,051,715,115
money bill.
The omnibus bill is to provide
funds for the Departments of
State, Justice and Commerce, and
the Federal Judiciary.
* * *
REVISED AND carefully tailored
to meet the specifications, Phillips'
amendment would strike directly
at Acheson and would spare sev-
eral dozen other top-flight offi-
cials who might have been hit by
an earlier version.
The amendment says that no
money provided under the omni-
bus bill could go to the head of
any Executive department who,
within five years before his ap-
pointment, was connected with
a professional firm that repre-
sented a foreign government.
Acheson's law firm once repre-
sented the Polish government in
obtaining an American loan.
TM *
THE AMENDMENT would cut
any such person off the Federal
payroll unless his appointment
was "submitted or re-submitted by
the President to the Senate for
confirmation."
The vote was 126 to 102.
Rep. Stefan (R-Neb.) sponsored
the reduction.
Local Blaze
Drives Mei
From House
Several men students fled into
the street yesterday afternoon
when a fire of undetermined ori-
gin destroyed the rear of their
rooming house at 725 Haven.
The owner of the rooming house,
R. J. O'Leary, called the fire de-
partment after being notified by
a neighbor who first saw the fire.
Responding firemen found the rear
of the house completely enveloped
in flames, and O'Leary held little
hope that the rest of the structure
could be saved.
** *
QUICK ACTION by firemen us-
ing high pressure fog guns kept the
blaze confined to the back of the
house and the fire was reported ex-
tinguished an hour after the alarm
was turned in.
The fire destroyed most of the
furnishings and personal belong-
ings of students occupying the
three rear rooms, while the kit-
chen and a shed were completely
burned out. Smoke and water dam-
age to the front of the house was
considerable.
One student was caught in the
third floor shower when the fire
started and paused only long
enough to grab a pair of pants
and his shoes.
Fire Department officials gave
an on-the-spot estimate that dam-
age from the blaze, which appar-
ently started in the kitchen, would
exceed $15,000.
-Daily-Bob Keith
NEW ROOMERS-The University's versatile Victor Vaughn House will open its doors to coeds next
fall. for the third time in its 12 years of existence. Its conversion for feminine occupancy will
come at the same time hundreds of rooms for men are made available with the completion of the
University's $5,600,000 South Quad.
odT nVu* * H * * s
Coeds To Live In Vaughn House
By BOB KEITH
Coeds will be living in Victor
Vaughn House next fall for the
third time since the structure was
built, Services Enterprises Man-
ager Francis C. Shiel announced
yesterday.
The 187 bed red-brick dormitory
overlooking the Huron River will
be opened for women "because
we're not getting enough housing
applications from men," Shiel
said.
** *
"THIS IS the first time we have
been caught without enough male
applicants to occupy our regular
men's facilities," he added.
Shiel laid the shortage of male
Field Denied
Bail by U.S.
Court Jude
NEW YORK - ()- Millionaire
leftist Frederick Vanderbilt Field
was denied freedom on bail yes-
terday by U. S. Supreme Court
Justice Stanley F. Reed.
The action in Washington also
applied to Field's two fellow-trus-
tees of the Civil Rights Congress
bail fund, mystery writer Dashiel
Hammett and W. Alphaeus Hun-
ton.
ALL THREE were jailed for con-
tempt after they refused to say
where the Congress got the bail
money it posted for four fugi-
tive American Communist leaders.
The decision climaxed a rec-
tic, day for Field, who was
whisked from one hearing to an-
other as the Government tried
to pry the bail data from him.
In a separate case, Field went
before a Federal grand jury with
orders to talk-or else. There was
no indication whether he did.
LATER, HE was taken before a
state banking investigation into
the Civil Rights Congress bond ac-
tivities. There he said little or
nothing.
applicants to a drop in enroll-
ment.
The unexpected lack of men and
the conversion of Vaughn House
into a women's dorm come at a
time when the University's mam-
moth new $5,600,000 South Quad-
rangle is about to first open its
doors for male occupancy.
Designed to ultimately hold
1,179 men, the South Quad will be
equipped to house approximately
500 by the time the fall semester
begins, Shiel estimated.
* * *
WHEN THE South Quadrangle
is fully completed, probably by the
start of the spring semester, the
"dispossessed" men who lived in
Vaughn House last semester will
be transferred as a unit to one of
the houses in the new dorm, Shiel
added.
"It is our desire to maintain
the spirit-and continuity of the
group despite the break of one
semester," he pointed out.
Vaughn House, meanwhile, will
serve to ease the still acute short-
age of women's housing, Shiel said.
LOCATED at the corner of
Catherine and Glen, Vaughn
Boyle .Denies
Connection
With RFC Loan
ST. LOUIS-(P)-The name of
William M. Boyle, Jr., Democratic
National Committee Chairman,
was linked yesterday with *print-
ing firm here which after three
unsuccessful tries secureda $565,-
000 loan from the Reconstruction
Finance Corporation.
In Washington, Boyle denied
any connection with the RFC loan.
*o *
THE POST-DISPATCH reported
that Boyle, a close friend of Presi-
dent Truman, was paid $8,000 by
the American Lithofold Corp., in
monthly installments which began
soon after an RFC loan for it had
been approved in 1949.
House was built in 1939 for use
by medical students.
Although coeds have remained
in the house for only one semes-
ter both times they previously
moved in, Shiel said they will
now be allowed to stay until
such time as the house is turned
back over to the medical stu-
dents.
He said this could be any*here
from one to three years hence.
IN ANOTHER move to counter-
act the shortage of male housing,
applicants, the number of male
residents in Fletcher Hall will be
sliced in half, from 110 to 58, so
that more men can be directed
into the larger University housing
units, Shiel said.
Meals are not served at
Fletcher Hall and its revenues
are not directly applicable to
the University's current dormi-
tory construction program.
The various changes in housing
will have no effect on the total
number of men living in the East
and West Quads next fall, Shiel
said.
Previous plans had called for
1200 residents in both dorms.
This number representing a re-
duction of approximately 150
men at each since last spring,
will still hold, he said.
Another previously announced
action expected to remain unaf-
fected is a contemplated $60,000
food improvement program in the
dorms. Financed by a $40 hike in
room and board rates, the food
improvement is already in effect
Shiel said.
THE LATEST housing moves
will serve to keep the larger dorms
as full as possible and enable the
University to meet construction
bond obligations.
It was not known whether fur-
ther acts will be necessary to
guarantee full dorm occupancy
once the complete capacity of
South Quad becomes available.'
This question is expected to
hinge chiefly on the size of Uni-
versity enrollment at the time.
Ungrateful
TAUTON, Mass. -An auto-
mobile hit a dog here but it was
the motorist who went to a hos-
pital, according to a United
Press dispatch.
Worried because he h a d
struck the dog, Ernest Spencer
Jr. got out of his car to give
aid, only to be bitten on the leg
for his trouble.
Living Cost
Index Drop
Announced
WASHINGTON-(A')-The Gov-
ernment's cost of living index
dropped from May to June-the
first decline since February, 1950,
the Bureau of Labor Statistics re-
ported yesterday.
The index on June 15 was 185.2
percent of the average prices pre-
vailing between 1935 and 1939.
That was 8.8 percent higher than
the index of June, 1950, just be-
fore outbreak of the Korean con-
flict, and 0.8 per cent above Feb-
ruary, 1951, the first month after
the price and wage freeze.
* * *
FOOD PRICES declined 0.2 per
cent between May and June. The
food index was 226.9 per cent of
the 1935-39 average. That was
11.7 per cent above last June.
Miscellaneous goods and serv-
ices dropped 0.1 per cent. Rents
increased 0.2 per cent while
other items in the average fam-
ily budget remained unchanged
in the month ended June 15.
At least 3,000,000 workers now
are covered by contracts calling
for upward or downward adjust-
ments in pay rates as the Govern-
ment index rises or falls.
However very few contracts are
adjusted on the basis of the June
15 index, because most of them
provide for pay changes only every
three months. The pay of auto
workers will be determined by the
July 15 index, to be announced late
in August.
World News
Roundup
By The Associated Press
WASHINGTON-The State De-
partment refused yesterday to tell
Senator McCarthy (R-Wis.) the
status of loyalty cases involving
its employes.
* * *
WASHINGTON-A stiff bill
aimed at correcting abuses in
the future operation of the GI
education program is being
drafted by a House committee
that has reported questionable
practices in the past.
DETROIT-The U.S. Treasury
Department and the Detroit Pro-
secutor's Office yesterday stepped
into the investigation of defense
contractors and the people with
whom they deal at the Army's
tank arsenal and tank-automotive
center here.
WASHINGTON - Chairman
O'Conor (D-Md.) of the Senate
Crime Committee asked Con-
gress yesterday to set a penalty
of 20 years to life, without pro-
bation, for any adult convicted
of peddling narcotics to youths
under 17.
* * *
WASHINGTON-Senator Aiken
(R-Vt.) declared yesterday that
opponents of the St. Lawrence
Seaway Project "are fighting
against the security of this na-
tion."
a* * *
McKES SPORT, Pa-A petite,
48-year-old grandmother beat
down a vigorous Republican an-
ti-Truman drive yesterday to
give Democrats their third Con-
Reds Offer
To Postpone
TroopIssue
U.S. Said Ready
To Accept Terms
U.N. ADVANCE HEADQUAR-
TERS, Korea - (A') - United Na-
tions and Communist teams met
today in Kaesong amid strong in-
dications they would rub out the
last barrier to full-scale peace
talks.
That barrier is the withdrawal
of foreign troops from Korea,
devastated by 56 weeks of war.
Authoritative sources in Wash-
ington said the Communists of-
fered yesterday at Kaesong to
postpone discussion of the knotty
issue until after an armistice.
* * *
THE ALLIED delegation went
into the meeting promptly at 2
p.m. (11 p.m., Ann Arbor time)
presumably ready to accept the
Red compromise.
U.N. Leaders had insisted an
armistice must come before the
withdrawal of foreign troops could
be discussed. Such withdrawals
are a political, not military, issue,
they said.
Earlier the Red Korean and
Chinese delegates had insisted
the issue of troop withdrawals
must be placed on the agenda
for further peace talks.
Helicopters carrying the five-
man Allied delegation took off for
Kaesong at 1:20 p.m. The usual
motor convoy carrying service per-
sonnel already had arrived at
Kaesong.
A wave of optimism swept Allied
advance headquarters following
Wednesday's ninth session. A
communique issued Wednesday
night reported "considerable prog-
ress toward formulation of an
agenda" was made at the meet-
ings.
* * *
DETAILS of the Communist
plan were not disclosed Wednes-
day, but it pertained to the - ex-
plosive issue of withdrawing for-
eign troops from Korea-the only
issue standing in the way of a
completed agenda.
In Washington the Commun-
ists were reported to have of-
fered a compromise in which
the withdrawal of foreign troops
would not be discussed until af-
ter an armistice is arranged. In-
dications were this proposal
would prove acceptable to the
United Nations command.
The Washington reports reached
the advance headquarters camp
before dawn but produced only
mild surprise.
A.P. correspondent Robert Tuck-
man said those receiving the word
felt it backed their own feeling
that "something big" may happen
at today's session.
MacArthur
Blasts U.S.
KoreaPolicy
BOSTON - (') - Gen. Douglas
MacArthur struck out last night
with a sweeping condemnation of
American policy, at home and
abroad, and declared that the re-
sult of the war in Korea has been
"indecisive."
In one of his most powerful
speeches since he was recalled
from the Far East, MacArthur laid
down four major points:
1. The result of the war in
Korea has been indecisive and
added that "appeasement became
the policy of war on the battle-
field."
2. American foreign policy has
become a "mass of confused mis-
understandings and vacillations.
The sorry truth is that we, have
no policy.
CONSTRUCTION PROGRESS REPORT:
Major Part of South Quad To Be Ready by Fall
Interior work on five of the
work has been completed up toI
IN THE UNIVERSITY Hospital
has been started, Roth said. The
provide a 40-car parking lot close