PACE POURTHE DAILY REFLECTOR, GREENVILLE, N. C

Monday, Augul 8, 1960

Mondaj', August 8, 1960

See Anyone You Like, Nikky?

The Greater Waste Lies In Apathy

Tiine and again over a period of years the federal gmernment has found itself confronted with charges by its General Accounting Office that this agency or that has wasted money in the millions for things which were needlessly bought or built wdth taxpayers* money.

It is important to the people of the nation that these matters are brought to light, and the GAO, watch-dog of federal funds, has done an excellent job of exposing waste in government operations.

The disturbing factor, however, is that time and again the waste exposed by the GAO involves practice and programs that have been exposed before and have gone uncorrected by the federal government, Such is the case with the latest GAO charge that iome 1147 million has been wasted by the military in needl#sly building housing projects at U. S. bases. On a number of previous occasions the accounting department has called attention to the w'aste of tax funds in housing projects at military bases. Each time there is a stir and commotion, the w'aste is denounced in Congress, the charges are denied by key officials of the agency involved. Soon it is forgotten and the gov-crnpjent lapses back into its traditional practice of spending taxpayers money like it was water.

Many of the practices w-hich lead to the waste are not altered. Procedures which permit the squandering of federal funds are not corrected. A few years later it is announced that several million more in tax funds

have subsequently been xvaated in a similar manner.

While Congress cannot keep tab on every dollar spent by the multiplicity of federal agencies, members of Congress, as the direct representatives of the people, have the ultimate responsibility for safeguarding federal funds. It is the responsibility of Congress to see that every possible precaution is taken to prevent this repetition of waste of federal money.

* It is not enough that members of the legislative branch of government make indignant speeches about the terrible w'aste in government every time such an exposure is made. It is not enough that the incident hold the limelight for a few days or a few weeks without basic reforms being instituted to prevent the recur-rance of the same thing at a later date.

Perhaps it is too much to hope at this late date somehing concre ill bndytnttiao something concrete w'ill be done by Congress to eliminate such practices as those recently uncovered. Reforms liave been passed up under similar conditions over the years. Too many billions in taxpayers\dollar have gone down the drain in unnecessary spending.

And yet, there remains the hope that some day Congre.Hs will devote as serious attentipn to preventing waste of federal funds as it does to appropriating new millions that will find their way down the same drain.

Carteret Bridge Is

Budget Surplus Of statewide Concern

''vlay Be Problem

Bv LYNN MSBET

CARRY-OVER The States general fund net credit balance or surplus at end of business June 30. I960, stood at $42,654,274. That will be money for the next General Assembly to appropriate, if revenue continues to exceed estimates for the fiscal year i%0-61. And it .S now predicted that the surplus at end of next June w^ill be in excess of $55 million, unless the 1961 Legislature digs into it for emergency appropriations for the current fiscal year.

The actual gross surplus this year was $51,710,194, made up of carry-over from 1959, receipts above estimates, and savings in spending (meaning funds appropriated but not allowed to be spent). However, the contingency payment to school teachers of $7,055,920 and $2,000,000 earmarked for projects in process. cut the net balance to $42,-654.274.

Of the $284 million spent last year, more than 73 per cent was for education. A breakdown by the budget office shows $202.-066,300 listed for education, about 71 per cent of the total. However, large part of the $16 million dollar item for retirement and pensions and $7 million for debt seryice went for school teachers and school building bonds, bringing the total for education to more than 75 per cent of all general fund spending.

Next largest expenditures were $27 million for health and hospitals, and $10 million for public welfare. Less than three per cent of the total spending was for general government, the agencies and departments about which most complaint of extravagance is heard.

In commenting to newsmen on the financial report. Governor Hodges castigated the niggard-Imcss of North Carolina, especially in the area of providing adequate facilities for its governmental operations.

FOOTBALL It is axiomatic that government surplus can be worrisome as government deficit. Shakespeare has one of his characters to say that "they who surfeit wth too much are poor as they who want for not enough. The prospect of a hefty balance next June will give the ujacoming Legislature a football to play with. The f^ct that approximately half the presently contemplated surplus will derive from non-recuTing windfall income tax withholdings will be argued in surport of claims that the money should not be itcd for recurring operating expenses. Some $27 million from this source was incorporated in operating appropriation.s for this biennium It was not needed r in fact, collections other than windfall provided for all ap-propriatiorLs and about half the surplus of the 1959-60 fiscal year.

There is .iuhstantial support

for the idea that the accrued surplus should go into permanent capital improvements, in lieu of bond issues for that pur-fKise. Clyde Harriss, chairman of the 1959 House appropriations committee and a member of the Advisory Budget Commission, is a* strong advocate of that policy.

On the other side of the argument are those who contend that a surplus of tax collected money indicates what the late Governor Scott called a deficit in public service, and that the balance should be plowed back into operations and future estimates of revenue be realistically based on an expanding economy. That concept was basic in the primary campaigns waged by Governor-nominate Terry Sanford, and was emphasized by implication in Governor Hodges comments at his latest news conferen^ce.

The clash of these ideas will precipitate some lively battles In the next General Assembly.

ADVICE Chairman Kemp Doughton of the Advisory Budget Commission advised spokesmen for State agencies, departments and institutions not to try to out-guess the General Assembly. At several ports of call on the recent budget commission itinerary there was evidence of "padding requests for Improvements on the apparent theory that we are not going to get all we ask for, so lets make application for a lot. with expectation the amounts will be reduced. Chairman Doughton was emphatic in condemning this attitude, and warned that It might backfire. The budget commission and the General Assembly are entitled to as accurate and complete statement of needs and a* honest report on activities as can be given, he said.

EXPORT TOBACCO Records compiled by the State Ports Authority show that tobacco exports consistently declined during the 1947-57 decade. but within the past three or four years there has been a steady increase. Most of the increase is in hurley leaf from Western North Carolina, Ten-ne.ssee and Kentucky for w'hich the North Carolina ports are logical points of export.

UNWILLING No child comes here because he is mentally retarded, said Dr. Frank Badrock, superintendent of Ca.s-wcll Training School. He comes here because there is nowhere else for him to go or stay, The doctor explained that many times when parents would like to keep their child at home, they cannot do so in justice to the re.st of the family. In most instances social needs rather than economic or mental condition is the prime factor in requiring institutional care._

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Were it not for the location of one of the state's deep-W'ater ports, the location of the proposed new highway bridge between the towns of Mohehead City and Beaufort in Carteret County would be of only passing interest to most people in other parts of North Carolina.

The fact that the proposed new bridge is close to the property of the state eport at Morehead, however, removes the bridge location matter from purely local interest to a matter of state-wide importance.

Upon approving the new location, Highway Director W. F. Babcock explained that the 65-foot high span over the inland waterway channel later could be converted into a dra^vspandf necessary. This factor, of course, may someday be ofutmost importance to the expansion of facilities at the Morehead City port. It would have been shortsighted indeed, had the Highway Commission constructed a new $2 million bridge that would have cut off possible expansion of the port facilities.

The states ports at Morehead City and Wilmington are yearly increasing in importance to the economy of the state. The goal of making them major port facilities on the Atlantic seaboard will depend in part on the ability of the state to provide necessary areas to expand facilities as greater demands are made on the ports.

While approval of the new bridge location along with the stipulation that a high drawspan can be provided laterapparently is satisfactory to everyone concerned, the state should make sure that at some later date the bridge does not become an obstacle to expanding the port facilities at Morehead City.

By GEORGE SOKOLSKY

Must Kno wRussi an History

Copyright, 1960, King Features Syndicate, Inc.

It would seem that Soviet Russia benefits from the ignorance of history and geography, the schools nowadays teaching the social sciences. There arc more than 1,000 years of Russian history that need to be known if we are to understand the Russian people. If we go into the story of the Scythians or the Uz-begs, we need even more history than that.

Thus when one writes about Russian gold an immediate economic problem in the world today, he is not discussing something that is novel in 1960 or that started in 1917. Gold has had a unique place in the history of man. No matter how taste has changed, gold has at least 6,000 yessB of history. Gold is rare: its color is attractive! It does not corrode or rust. Although Lenin ridiculed the value of gold.

his government has always hoarded the metal. C. H. V. Sutherland, in his book Gold esti

mates that during the past five centuries about 100,000,000 lbs. of gold has been taken from the Earth for the use of man. This metal does not appear in quantities everywhere. Russia possesses three large areas that

have produced gold in enormous quantities: the south Urals, the Lena fields and the Altai field.

Gold has always been found in what is now Russian territory, being exported into Persian, Greek and Byzantine civilizations. But it was in the I9th

Century that the Siberian fields were exploited to a degree that made Russia the principal gold producer of the world at that time.

Sutherland writes:

. . . Alluvial gold from the Urals was generally of high purity .. . it made up the great

Basic Difference Other Editors Saying...

n Two Platforms '^'^^ditionalWhippingBoy

By RALPH ROBEY

By all odds the greatest controversy in the Republican National Convention was over the platform. The particular points upon which there was disagreement were oivil rights, defense, and to a lesser degree the proposal for federal aid to education. Until the last it appeared there would be an argument on the floor, but that did not happen. None the less, this is the most liberal platform ever adopted by the Republicans.

But just as in the case of the Democratic platform, we are concerned only with those pledges and policies which have a direct bearing upon the business trend. There is a vast and basic difference between the two platforms in this regard.

Tlie Democrats, it will be recalled. pledged whatever policies that may be necessary to have a national growth rate of 5 per cent, and made it clear that this was a responsibility of government. The Republicans are in favor of more rapid growth (they mention no specific percentage! -but insist that this must result, not from government action, but through the decisions of free men. Their proposals. therefore, are designed primarily to create a climate which will encourage growth.

The exact words in the Republican platform are:

To build a better America with broad national purposes such as high employment, vigorous and steady economic growth, and a dependable currency, responsible management of our federal finances is essential. Even more important, a sound economy is vital to national security.

They state it as their belief that except in times of war or economic adversity, expenditure* should be covered bv revenues and our tax stiucture should be improved to provide greater incentive.s to economic progress, to make it fair and equitable, and to maintain and de.serve public acceptance, They pledge to support the independence of the Federal Reserve System and this is directly contrary to the pledge of the Democrat*.

A most uaqsual lt*m in the Republic platform is the priority assigned for the use of federal revenues. This Is. flr.st. meet the needs of nntioiol d<^ feiLse: s.iHond, t.at e rare of the urgent needs of the nation" that cannot be handled by local government or private teuton; third, reduce the public (iebt: and fourth, iinpruve our tax iinicture

All argumriit can he inad*: for this order, but in our judgment it 1* not tcx) sound. Obviously

national defense need.s must be met, but it doe* not follow that this should require larger expenditures, and certainly there is no evidence that we need an increase of $3 billion, as Governor Rockefeller has been saying.

The urgent needs of the nation is so vague a phrase that it can mean anything, and it could be made to absorb all possible growth in revenues.

Paying off a part of the public debt is a desirable objective. but at the moment it is not as important as tax rate reform. This is because only by tax rate reform can we get the increase in personal savings and incentive that are essential for a more rapid growth of the nation.

It is not too much of an exaggeration, therefore, to say that the order of priorities listed in the platform is exactly backwards.

There are other points in the platform upon which theres much room for dlaagreement from the economic point of view. But the over-riding fact remains that this Republican platform reflccLs a basic faith and confidence in individual en-terprtse and freedom, whereas the Democratic platform was directly pointed to a more and more powerful federal government and less and less individual freedom. It will be interesting and Important to see whether this difference is maintained in the campaign which is anpad.

OPPORTLMTIES FOR

There are numerous small industries which should attract young people to Maine. Unfortunately, too many young people are leaving the State. This sad fact, however, furnishe*

more opportunities to young people from other states to come

to Maine and start a small

business. There are in Maine small woolen and other textile mills, .shoe factories, lobstef and other fishing and canning facilities. and passible foims of mineral extraction. The field of

recreation al>;o holds many opportunities for starting a small independent business, Maines surplus of water power make* for reasonable electrtc rates: it* freedom from state income taxt* allows reasonable operating costs; while its labor situation Is especially favorable. The efficiency of the workers Is to be eommendi'd. Maine people are liL'-imriively rehvious and con-scientioiw They are anxloiu; to give a dajss work and are naturally ingenious.

For young people who want an independent biLsine.s.s, I e-pi'cially reeonmv'tul that they visit AtiguMa. Maine, and ere the Department o Economic

.(Uoutuiuea on page 5>

(Rocky Mount Telegram)

Political expediency almost certainly indicates no farm legislation at the shirt-tail post-convention session of Congress. Sen. John Kennedy, with his advantage of Democratic control of both houses, says only that he is consulting his advisers on several proposals. Senate Republican Leader Everett Dirksen has said he would like to see a wheat bill that would "at least meet the emergency of a mounting surplus. But the Democrats have a must program of their own which does not extend to the problems of farmers.

Besides, Kennedy made It quite, clear he wanted to keep the tag of association with Secretary of Agriculture Ezra Taft Benson securely pinned on the lapel of Vice President Richard Nixon. The sequence of events starts wn^ti Nixon, who dissociated himself from Benson, for whom he had the highest regard and respect. and called for new leadership and promised for agriculture a new massive program.

Kennedy backers charge that Nixon had haiied Benson as the greatest Secretary of Agriculture in our countrys history. Benson finds himself in much the same boat a* his predecessor, Chai'les F. Brannan. in 1952. The program of neither man wa* wholly put Into action at any

time during his Incumbency. Indeed. Brannan was so put upon that in 1952 he denied authorship of the controversial program calling for non-recourse loans at 100 per cent of parity for storable commodities and direct payments to farmers on non-storable commodities.

The program had been tagged the Brannan Plan, for political purposes, Brannan claims. In any event, the GOP platform in 1952 condemned the Brannan Plan as aiming to socialize agriculture. And Gen. Eisenhower campaigned against the Brannan Plan as a political monstrosity amounting to moral bankruptcy. Ironically enough,' the President was to propose in his 1954 farm message special treatment for wool, subsequently adopted by Congress, which was immediately lltened to the Brannan Plan.

Benson, like Brannon, denies having a plan. But Benson appears to be fated to be the same .sort of whipping boy for the Democrats in 1960 that Chai'les Brannon was for the Republicans eight year* ago. The truth seems to be that the Secretary of Agriculture, the traditional friend of the farmer. Is anything but his political friend in election years unless the farmer can afford to drive to the polls In a Cadillac.

bulk of Russian gold output down to the eighteen-thirties: for the years 1814 to 1839 the total yield has been put at over 175,000 lbs., with an annual average of 5,000 lbs. or more. At this point, however, a decline set in, either because of the alluvial gold had had it* richest deposit removed or because attention was switched to new and very rich sources lying in the remote territory west of Lake Baikal in the valleys of the Altai Mountains.

For here too there were numberless alluvial sites, the combined yield of which quickly surpassed mat of the Ural region: 40,000 lbs. were obtained in the decade 1830 to 1840, and the annual average rose thereafter very sharply to 13,000 lb. and, even higher, to 17,000 lb . . .

Today, we have no figure* on the production of Russian gold. Sutherland estimates:

. . . But the bulk of this massive annual quantity a quantity, each year, which It would have taken Roman miners more than a hundred years to extract from their deposits In Spain comes from five areas in particular. Australia supplies Just under 5 per cent of the annual world total. From the United States there comes Just over 6 per cent. Russian output is veiled behind the curtain that hides so much else, but is put around 7 per cent. Canada furnishes over 15 per cent, and her figure may rise substantially with the discovery and exploitation of new goldfields in the Quebec region. And, finally, South Africa claims the astonishing figure of nearly 50 per cent . .

Of the known figures, about 80 per cent of all gold mined comes from the ipritish Commonwealth. But in all these figures there remains the dubious quantity from Russian territory. There are no reliable statistics but estimates are possible, particularly in view of the prior knowledge.

Now, we come to the serious political problem in the Cold War of the Russian plan to establish a gold rouble producing a coin in international commerce which can be harder money than the American dollar. If you talk to an optimist on this subject, he will say that money is based on confidence and that whereas there is universal confidence in the American dollar, there Is no confidence In the Russian rouble.

This is like the statement so often made by American busi-<Continued on page five)

Maine !^ich In I'orests

By ROGER BABSON

BABSON PARK. Mass. It ha* been my custom tq,.-pend A part of each summery visiting a different section of ma~<mn-try. This summer I l|^ve c1kp sen the State of Maine. I have been truly astounded by its size, its coastline, and certainly its natural resources.

POTATO INDUSTRY

Through the compliments of the able President of the Bangor & Aroostook Railroad, Mr. W. Gordon Robertson, I have been able to travel through the approximately 150,000 acres of growing potatoes. The plants were in full bloom with their white blossoms when I took the trip, and I was able to talk with some of the leaders in the industry. The potato growers are more than just farmers. They are progressive businessmen who are constantly seeking new varieties of potatoes and attempting to Improve the quality of the crop. The best potatoes are marketed, while the small ones are used for producing frozen "french frieds, premashed potatoes, starch, and other by-products.

When you eat a finely flavored meally potato, you have no idea of the patience, brains, and hard word which have been put into raising the potato. Apparent ly the only thing which Aroostook County cannot control is the rainfall, which may be too much, or too little, or occur at wrong intervals. I understand that the two reasons why Idaho potatoes are such a strong competitor to Maine potatoes is because the Idaho potato growers use considerable irrigation and freely spend money on advertising. Maine people need education on the value of advertising.

LT^IVERSITY OF MAINE

AGRICULTURAL DEPT.

Preceding my trip through Aroostook County I spent several hours with Dean Winthrop Libby, who probably knows more about potatoes than anyone in Maine. He explained that the potato is really a part of a stem, and not a seed, or a bulb, or a root. In fact, Uie tiny potato seeds which come from the blossoms are of no use to the industry. As most readers know, new potatoes are obtained by cutting an old potato into several pieces, each containing one or two eyes which develop sprouts and give us the new potatoes.

Dean Libbys wife, who was a teacher of Home Economics, says that the perfect menu from a dieticiana standpoint is a potato with a piece of butter thereon, a glass of milk, and some orange Juice or fruit. Furthermore, the potato contains only 20 per ceiit starch compared wlUi 40 per cent in bread and 80 per cent in rice hence It is really a food for reducing, rather than being fattening. Maine is very backward in not adverUsing this.

THE PAPER PRODUCTS INDUSTRY

I am told that 90 per cent of the great State of Maine is covered with growing timber: also that this timber is growing faster than it is being cut and used.

I was astounded to stand at the Searsport terminal of the Bangor & Aroostook Railroad and see a ship 400 feet long loaded with newsprint made from Maine trees by the Great Northern Paper Company. There, however, are several other paper mills in Maine. Your newsboy probably delivers to many of you each day State of Maine newsprint: and even the books which you read and your telephone directory might well have been printed on paper made by Maine mills- Maine is also benefiting from the growth in packaging of almost everything sold in supermarkets, as well as from the increase in use of cartons and boxboards. These products, however, are suffering from lack of proper advertising.

The State of Maine la doing very little to help the manufacturer of these paper products. This especially applies to newsprint, which is absolutely dependent upon newspaper ad-overtising. Radio and television advertising and the beautifully colored magazine advertisemenU are all indirectly aided by the federal government: but the

State of Maine is doing noth-(Continued on page five)

Should Men Tru st Hunches More?

By ELMER ROESSNER

A suggestion that businessmen trust their hunches more has provoked a storm of praise and abuse for the suggestor. Eugene Raudsepp. Director of Psychological Research for Deutsch ic Shea, Inc., a manpower and industrial relations consulting firm.

Mr. Raudsepp advanced hia

idea in the April Issue of the Management Review, publushed by the American Management A.ssociatloii. Since then both he and the magazine have been bombarded with letters from buftinei* executives. Opponents have called him an enemy of progress and t subversive aittcker of the electronic brain. Supporters hgve calltd him t new leader in the fight of m^n verses machines, (ilenn J. Christensen, dean of Lehigh Univer-.sity, ciIIhI his article n stride forward in the science' of behaviorism.

Intuition has fallen on bad dayf, Mr. Haudsfpp wrote Ihert was a time when it was ponsldered a preeioiw mental faculty' a direct plpelinc to the essence of Iruth. Now, however, the pendulum has swung the other way, and intuition is

scorned as a prescientific concept and certainly has no place in the hardheaded world of buslncs.s..

HUNC H DtCTSlONH SCORNED

Today, he said, business cherishes the nonthinking executives; It stands in awe of the man who does not think for himself but who feeds facts and question.^ into an electronic machine and comes out with an incontrovertible answer. He quoted Irving Laiigmuii, philasopher and chemtl: In complicated situations of Hie, we have to solve numerous problems and make many decision*. It is absurd to think that reason should be our guide in all cases. Reason ia too *low and too difficult We de not have the necessary date er we ctanet simplify our pro-blems sufficiently to apply the method* of rra.*ioning. . .We underrate Hie impoi lance of intuition

He also quoted Albert Einstein; philosophers Susanne K. Linger gnd Jaqqurs MarUaln, and mathematician Jacques Hadamard in defense of lu-tnitlun

I'Koin rr ok

SUBCONStJOl s ,

Ml'. Raudsepp said that hunch

es and Intuition are usually the product of unconscious thinking, below the threshold of unconscious awareness. He conceded there is no way of telling the validity of the hunch until it has been acted upon. But many executives, he found, know that their intuitions often have a sense of certainty that an intuitive de-cLsion is the right one.

And intuitive decLsion is also frequently accompanied by a .sense of compulsion that urges the executive to do .something about it immediately, he wrote.

Furthermore, he added, most Important business problems are an inextricable mixture of factual and other characteristic*, and many of the latter are inaccessible to any directly verifiable observation.

In other wnriis. htLsineiu; problems iuiolve human element* that cannot be calculated by formulas or electronic machine. Therefore, the machine cannot give a complete answer but a human mind can.

Mr. Raudsepp said he is col-lictliig hud uric.'! of cases In which bunch decision* proved correct.

Reliance on formulae or electronic machines is especially bad at this period in our history, he said- We need leadership with the confidence that it can -make the right choice.

Dependence on machines pd formulae makes executives reluctant to assert their powers of leadership. It may even affect their personal life. The executive who may unable to make an intuitive decision may eventually be unable to make decisions for himself and family without the benefit of calulating machinesand so few homes have them these days! he said. U.S. EXPORT OF GOODS EXCEEDS OUR IMPORTS

In the recent column about the drain of United States gold, it was incorrectly stated that S. Imports exceed exports. The U.S. Mtill srll^ more goods abroad than it buys.

Howevar, we are spending more abroad than foreigners When spending for travel, foreign aid and private investment abroad is con.sidered, our (U'ficit ih our balance of pay-iiHMiis Is great atifl, as staled, will probably be about $2.5 billion this year.