PAGE FOURTHE DAILY REFLECTOR, GREENVILLE. N. C

MMiday, October 5, 1959.

Monday, October 5, lSf>9

Money Problem Forecast For 1961

Will state, revenues brought about by economic growth in North Carolina during the current biennium make up for the withholding tax windfall of $27 millions that will be spent for current operations between now and July 1061?

That question has been dabatc.l throughout North Carolina since Gov. Hodges proposed the withholding system of income tax colhections early this year. It is likely to continue well into the legislative session of 1961 and to have a direct bearing on the financial policies for the state set by the legislature.

Just this Aveek Gov. HodgesS-eiterated his opinion that the 1Q61 legislature will not face financial difficulties created by the spending of the windfall money for current operations in this biennium. He did so in defending the fiscal policies of his administration before the Young Democrats of the state.

While many North Carolinians are skeptical that economic growth during the biennium will provide sufficient new revenues to off-seL the $27 miUion tax windfall, it is significant that many legislators who cannot be termed pro-Hodges have voiced opinions similar to those of the governor.

It is also significant, we believe, that the outlook for increased tax revenues because of economic growth now being voiced by the governor are much different from those he voiced before thi^l959 legislature con

vened.

Another Divorce

"n State Agencies

By Lynn Nlsbet

DIVORCE? There may be ^nother major divorce action pending in State government. Many people think the next significant reorganization step will be separation of the Commerce ii Industry Division from the Department of Conservation and Dewlopment and made the nucleus for an independent agency with full departmental status.

Such a step would follow precedent established in 1947 when control over non-commercial fish and field game was transferred to the new Wildlife Resources Commission. The 1959 General Assembly combined responsibility for water regulations. which previously had been vested i three or four agencies, in the new Department of Water Resources.

After control of inlands fishing, field game and water resources were taken out. the C&D department still has widely diversified responsibilitie.s. The department has administrative divisions for State advertising and tourist-travel promotion; commerce and industry, for industrial development: commercial fisheries, including phases of conservation and '' promotion; community planning, for cooper-on with local people in overall utilization of resources; forestry, for fire control and orderly reforestation; mineral resources, which IS becoming increasingly important; and the administration of State parks.

There have been serious sug-gesUons that the commercial fisheries and forestry divisions should be independejitly administered. Majority opinion of those who have studied the problems doubt such separation wold be wise. Prom the beginning of the Umstead administration early in 1953 until now, the commerce-industry division has been so emphasized that it had become almost a case of the tail wagging the god. Governor Hodges has made industrial development the major objective of his administration.

HISTORY When Governor McLean in 1925 sponsored establishment of the Department o^ Conservation and Development, of which the old Geologic Survey and the Commercial Fisheries Commission were the chief components, the main idea was to conserve and develop natural resources fish and game, forests and mineralsprimarily for the benefit of North Carolinians.

The present extensive State advertising program grew out of the Governor's Hospitality Committee, established by Governor Hoey in 1937-38. A natural corollary of that idea was the de-A-elopment of a tourist buslnes.s. now worth more than a third of a billion dollars a year to the State. Plans for industrial promotion were sidetracked in 1939 by war in Europe, followed by U- S. Intervfntion in World War II.

For four or five years after that shooting war ended North Carolina faced necessity for rehabilitating its roads and schools, which had suffered deterioration during the hostilitie.s. It was not until around 1952-53 that real attention could be given to industrial development in order to provide jobs for farm workers who were being displaced by machines. It W'ould not be accurate, or fair, to sav that con-ser' ition and development of natural resources" have been neglected; but. certainly since 1953 major emphasis has been on industrial expansion. It is recognized that some balance must be maintained, but it is inevitable that sound economy depends upon North Carolina moving out of the strictly homc-farm category.

With that present and probably continuing emphasis on industry, many people think the time has come to set up a separate department to deal with the problem. C&D will still have a big job to do with its other obligations.

COMPONENTSThe proposed new department in all probability would include the State Ports Authority along with the present C&D commerce-industry division as its nucleus. This tie-in has already been accomplished with removal of the Ports Authority offices from Wilmington to the same floor in the Education Building at Raleigh where C&D is quartered, and by designation of Ed Kirk, assistant director of C&D, as secretary of tlie Ports Authority.

The plan to incorporate the Ports Authority into a new department designed to promote industrial progress. contemplates that the ports section might give more attention to development of shipping on rivers and canals as feeders to the tw'o big deep water ports at More-head City and Wilmington. There Is'considerable feeling that ports management, present and past, given over emphasis to big business. passenger and freight cargo. in competition with Norfolk Charleston and Savannah, and not enough attention to developing local service.

The concept that the deep sea ports should give more consideration to North Carolina needs than to those of big shipping companies is in line with the idea that any new industry sought to be located in this state should be evaluated on its appropriateness to improving our conditions rather than bailing out a factory which is in trouble somewhere else. Many people who have studied the problem think that the suggested new agency, which might be dubbed the Department of Industrial Development, can best serve these purposes. It would be free from administrative involvement with such more or less indirectly related problems of fishing, forestry and mining. __

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By RALPH ROBEY

battle? There are two principal

In Washington there still is extensive and, frequently, heated discussion as to w'hether President Eisenhower won his battle to balance the budget. It would" appear that this should be an ea.sy question to answer, but it is not.

The controversy started last January when the new* Congress convened. An extraordinarily large proportion of the members had been elected with the aid of labor union support. It w'as their clear intention to enact large proportion of the members had been elected w'ith the aid of labor union support. It was their clear intention to enact large spending billsas ah aid to recovery and an almost endle.ss st of increased welfare proposals.

The President immediately made it clear that he was not going to travel down that path that to the best of his ability he w'as going to hold appropriations dowm to the point where spending would be below receipts taken in by the Treasury.

The fireworks, of course, were not slow in starting, and they continued until the Congress adjourned.

Tcf'carry out his determination the President vetoed one spending bill after another. In some instances the veto was based upon the amount being larger than the President thought necessary. In other instances it was because the bill provided for a type of spending which was believed unwise. Perhaps the most surprising veto was that of the public works bill. This is known as pork barrel legislation and, according to reports, no president since Cleveland has had courage to veto it. The first veto of this measure was sustained, but Congress quickly passed another bill providing for all the same projects, but at an aggregate cost of 2*2 per cent less. The President also vetoed this, but in this instance the President was over-ridden, for the first time since he took office.

Why. then, should there continue to be a controversy over whether the President won his

reasons:

First, the Democratic leaders insist that they held appropriations about $1.5 billion below the Presidents budget requests, and ' superficially that is correct. The reply of the Administration and its spokesmen is that this does not take into account programs being started which will cost much more in future years.

Second, the total of appropriations does not determine or control the actual volume of spending. This is because of unspent balances from previous appropriations. Even if one grants the Democratic leadership claim of holding down appropriations, it does not follow that the budget will be balanceff. ' That" will depend upon how much the Administration is willing to release for actual spending. The Administrations mid-year budget review, released a few days ago, forecast a surplus of $95 million.

It is my personal opinion that for the fiscal year ending next June 30 we shall have not more than a billion dollar surplus, or more than a billion dollar deficit. Many careful students are of the opinion that the deficit will be two or three times this large, and it still is too early to attempt to prove that they are wrong. We may be sure, however, that if President Eisenhower had not entered this battle, we would be anticipating really significant de-ficts.

Opinions In Brief

THE UNITED WAY

Happy OrbitMoving

Prior to the convening of. the legislature, Gov. Hodge.s repeatedly warned citizens of the state that tax mercases might be necessary to meet the increased demands being made on the states government. In a conference with newsmen on one occasion Gov. Hodges expressed the opinion that revenues from the states economic growth between 1957 and 1959 would not provide sufficient new money to meet the increased needs of the state in this biennium. Apparently, the governor was right, otherwise the windfall legislation would not have been necessary lo balance the budget.

In order to prevent sharp lay increases for the biennium which begins in 1961, the economic growth of the state will have to be suificient to make up for the $27 million tax windfall as well as the normal increases in the cost of government .services and operations that might be expected.

There is no doubt that North Carolina is increasing its rate of economic development. It is adding more industrial plants and more new jobs with each passing month. There is every reason to believe that the rate of development .will continue to increase throughout this biennium. Even so, if the. rate of growth from 57 to 59 was insufficieent even to provide enough new tax money to meet the normal growth demands of the state in that two year period, can we expect the growth from 59 to 61 to be suificient to^ meet the demands brought about by growth in addition to providing an extra $27 million?

We have every confidence in the future economic development of North Carolina. We trust the predictions of Gov. Hodges and other.s prove correct. In the meantime well stick to our previous opinionand

hope were wrongthat the 1961 legislature is going to be confronted wdth one of the most difficult financial problems in recent history because the 19.59 legislators decided to spend a huge chunk of non-recurring state revenue for recurring state expenses.

i owgra

Middle

Budget Question Still Discussec.

By HAL BOYLE

Oil Lgmn Big Item

By ROGER BABSON

GOTEBORG, I had been told by some of my Washingfbn friends who have heard Premier Khrushchev that the, Torecast as follows; Russia will gradually become more conservative and the United States will gradually become more socialistic, until they meet on a middle ground, like Sweden. With this in mind, I have looked forward with great interest to visiting Sweden, where I now am.

Swedish People Have Security Stockholm-4he capitalis a beautiful city with wide streets ^ rand handsome^ buildings. It has large supermarkets with co-operative managements. Railroads, utilities, and telephones are mostly government owned. The people have old-age assistance, free medical care, and many other things which give them security. They seem happy, contented, and not overworked. They have only one complaint, namely, that taxes ai:e very high.

Not only is real estateheavily taxed, but excise taxes exist on most products used by the people from the craxlle to the ^ grave. There also is an expensive bureaucracy of government employees. Even though there government jobs. Until well after World War I the heavy taxes were cheerfully accepted, as Sweden was very prosperous from 1912 to 1927. But World War II was a different story. Sweden then got little trade, there was much unemployment, and the country went heavily into debt.

Cannot Balance The Budget

We all know what happened to Germany, . Poland, and many other European countries during World War II. They completely defaulted on their national debt and the value of their dollars declined greatly. The Swedish dollar called a KRONA

NEW YORK (API Those who put a light in the window for the one away do not always depend on Thomas Alva Edison.

Last year some $1,196,000 worth of old-fashioned oil lamps lighted American homes. When I write this I think of an endless landscape in South Dakota with a distant twinkle in the dark.

name what famous people die of. If you ask the ordinary person if they can name the year of birth and year of death and cause of departure of someone they admire who died naturally, often they have to stop to think.

and they are liberty, equality, and fraternity.G. K. Cherter-ton.

How often did bandits interrupt the 1,966-mile delivery o U. S. mail from St. Joseph, Mo., to San Francisco during the 18-month life of the Pony Express? Only, once was mail lost.

The one I have in mind is Emily Dickinson, born 1830, died 1886, Brights dlseasfe. Who do you think of?

This marvelous record of American communications had a wry result the completion of a coast-to-coast telegraph system made the pony run unnecessary and pauperized the genius that sponsored it.

How many red-haired presidents have we had? My opinion Is that Thomas Jefferson alone

Everybody knows a child says mam^ first. A father is sure the clnld says da-da next. What is the third word that any child evqf said? Who paid any attention?

How do you feel about a messed up desk? When I see a piled up desk, I think, Here is something a man wants to come back to. When I see a spotlessly clean desk, I say to myself He must dislike his task to make it so easy for the next man to come in and take his place. His desk has no identity. He probably has less.

If you were a beggar whom would you approach first? 1 have read that students of beggary say a fat, middle-aged woman is the first target. It has been my experience that if T pause at a window. I am more likely to be hit with the set pan and the held hand.

Words are exciting things. You dislike them or like them for your own reasons. Words belong to you or they dont. I like the open sound of hello, the mellow sound of mellow, but brake my thought against grudge and drudge and always -thought mellifluous was never spoken except by people who had marshmallows in their mouths.

is now worth only about 19 cents.

Sweden has not balanced its budget since 1952. In fact, the budgetary deficit has been in a decided uptrend, and in the year 1958 the deficit had risen to 1.5 billion Kronor, or to the equiv-lent of $290 million in American funds.

Swedens Economic System

Discouraging To Executives

All the above is disappointing to me, especially as the Swedes do not admit that they are operating under a Socialistic Government. They talk only of a cooperative government. It is true that the Swedish people buy almost everything from the great Co-operatives which operate most of the factories and many of the farms and other produc

ers.

was.

Famous people have ordinary diseases, but few people can

Our quotable notables; There are only three, things in the world that women do not understand;

There is no doubt that English has the worst word known in any language. It is goodby.

Other Editors Saying.. Strength osing Industrial Men for Today

(Hertford County Herald)

News report from Mo.scow is that Russians now are being allowed for the first time to buy things on the installment plan from government stores. En.slavement is complete! Tallahassee Democrat.

A good rule seems to be to put on extra police whenever a meeting announces peace or ftiendship as being among Its cbjectives. Asheville Citizen.

The fact that two top governmental indUstry-hunters have left the employ of North Carolina to go to South Carolina just when this State is supposedly in the midst of its great industry-hunting effort seems to indicate that maybe all is not as rosy in this drive as it might be.

Walter Harper, head of the Department of Conservation and Developments industry-hunting outfit, left in August to be chief industry-hunter in South Carolina. Then, this month, Gerald F. Albright, head of the small industries unit and a man who was perhaps next to Harper in ability, has left to join Harper.

These men. it would seem, would think that North Carolina is the place to be for their work. The state, according to its industry-hunting governor, is in an f^xciting period of industry-hunting and should be a good place for men who make that their game.

Of course, these men were tempted with hefty salary increases. Much of the reason for their moying was personal.

Still, there is some room for doubt that our industry hunt is all it is cracked up to be when its two top governmental practitioners feel that there are greener pastures in another southern state and that state is South Carolina of all places.

The fact probably is. our states Industry hunt is not much more

intensive than that of some other southern states. Certainly some others have grabbed some of the biggest migrating industries which have come South in the past few years.

Governor Hodges, as a matter of faat, has relied heavily on his own personal resources and the work of volunteer hunters rather than on the governmental Industry-hunting unit of the Conservation and Development Department.

This reliance on other resources rather than on such men as Harper and Albright was probably a big factor in their decision to go to South Carolina, where a new young governor has set out on an industrial development push with all stops open.

The governor has great ability in this field of industry-hunting. Because he has used his own ability to the exclusion, of at least to the weakening, of the work of such men^ Harper and Albright. In the Idng run, the governors personal Nyork may pay more dividends th^ steady work by a long-establisnbd governmental agency.

But the loss of such men as Harper and Albright will be felt in the states industrial development effort simply because they are men who had a tremendous backlog of knowledge and a tremendous store of day-to-day work which is lost to the state, not only lost, but actually taken to a rival where you can be sure it will be put to good use.

By EARL L. DOUGLASS

PEACE OF MIND

I sat with a friend of mine on the porch of his summer house laie one hot afternoon. His dog lay stretched out in the sunshine, drowsing happily, occasionally rousing enough at the sound of his masters voice to open one eye and beat his tail lazily against the floor.

Talk about peace of mind, my friend said, looking at the dog, theres real peace and contentment.

In a way. of course, he was right. Not only was the dog happy and content at the moment, but he was entirely free from the worries that plague most of us: How am I going to pay my taxes? What will the doctor report about my child? Will business improve? Will there be an atomic war?

Some of us, when we wish or even pray for peace of mind, seem to want to be very much like that dogfree from work and worry. But that kind of peace is simply not possible for intelligent human beingscertainly not for Christians, who know that they are their brothers keepers and that they cannot ignore their neighbors needs.

Real peace of mind comes not from the absence of problems but from the possession of confidence and strength to face the problems. Christians know that only God can help them to that confidence and strength.

Then what is the trouble? I hear no complaint of dishonesty: the workers are faithful and there is less leaning on shovels than In the United States. The difference is that the able Swedish executives leave the country, - going largely to the United States where they can earn much more. Because of Swedens economic system the country cannot get efficient managers; and this applies to the banks and all offices which receive high salaries in our country. The lid on executives salaries is the great handicap to the Swedish Co-operatives, railroads. steamships, and utilities.

Our Capitalistic System I am sorry to find this state of affairs in Sweden. Government-operated businesses need the competition of privately owned, fairly taxed competition. But our privately owned companies also need more competition as they become bigger. This is especially true of the Dow-Jones Industrial concerns, which have recourse to unlimited capital. We further can get the worlds best managers, since we can pay very high salaries. This, however. Is not healthy. Our nation needs small businesses. just as a church needs % Sunday School, Yet our good executives are being forced into the professions and government jobs because of the very high taxes levied on big business.

Not only does the Swedish system lack the Income to attract good managers, but Sweden Is losing its best mechanics and artisans. Khrushchev may see this danger ahead for Russia. It may be his reason for keeping his workers at home and not letting them see how much better they could live in the United States than in Russia. This may be one reason why the Communistic nations want to make the whole world communistic, namely, to prevent the moving of their best people to a so-called capitalistic country whera business is privately owned.

More Predictions For Business

By Elmer Roessner

It was predicted here August 8 that Khl'ushchev would attempt to create a climate for more So-viei-Amencan trade; it was predicted that American producers and exporters would carry the ball after Nikitas kickoff.

The first part of this lookahead materialized; this is .to predict action in the next few weeks will fulfill the second part.

Khrushchev played it just right. He mentioned possibilities of more foreign trade forcefully, but be did not beg for it.

Today, thousands of American businessrpen are asking .themselves. Can I make a buck if ther^ more trade with Russia? .And those who think the answerJS yes will .spearhead the campaign to let down restrictions.

MAY pE (;OOD IDEA.

This is not to say that their

mercenary interests will adversely influence American foreign relations, nor is it to say that everyone advocating more tr^de with Russia is moved by hope of personal gain. As was said here then;

No on? ever shoots a paying customer.

Realization of that ti'uism will increase agitation for more trade with Russia. Trade may not only warm up the cold war but also postpone the shooting war.

Here are more predictions, based on analyses of the news;

More juice: Most fruit and berry crops exceeded expectations this fall, generally exceeding demand. Surpluses axe being converted into juices; canned and frozen Juice will be bountl-lOt^uid cheaper next year.

More coffee houses; The Euro-coffee-house \dca le catching on in the U.S.A. They are springing up everywhere late

ly in shopping' centers, The big upsurge will be in the spring, when outdoor tables will attract customers to new' ones.

A RECIPE SUCESS

New hit cookbook; The new General Poods Kitchen Cookbook will emerge a best-seller in the field. General Foods has already spent $2.000,000 in prepublication promotion and is planning to spend as much after publication. Besides, its a pretty sound book.

More textile boom: Almost all kinds of textiles sre in firm demand and, although there will be some setbacks, the general price trend.s will be upward. Despite the loss of wages in ,the. steel strike, spending has been sustained and will shoot ahead in the next few months.

More lawn power. Popularity last summer of powered fawn-mower.s has aiused stcpDcd-up production schedules over win

ter. In addition, demand for powered mowers is strengthening interest in powered tillers,/powered edgers and other put-put garden Implements.

OLD PROMOTER INVENTS THE WHATNOT SCREEN

Another postcard, from the Old Promoter;

Rush money. Have great new idea. Modern families have no room for old-fashioned curio cabinets. Modern families need room dividers. Have Invented room-dividing screen with hooks on which to display Delft pipes. Mexican dglls, rocks from the Catacombs and ashtrays stolen from the Cafe de la Paix.

Have models , with cut-throuch shelves and. aperturr.s fnr larger gadgets, and with fiJa.ss globes for disphiylng rar-ilie.s.

It sounds like a good investment for somebody eiss.