Monday, November 20, 1961

Dirty Word

Finally Emerging As A 'Republic

After years of Trujjllo dicta^rship, the Dominican Republic apparently is emerging as a genuine public to take its place among the other democratic nations of the Western Hemisphere.

in these last few days is important to all of the nations of the Western Hemisphere, because it represents removal of one of the thorns in the side of greater cooperation between the governments of this hemisphere. With the change, there is every reason to believe the Dominican Republic will be able to assume its rightful place among the other democratic governments of the inter-American group.

The change has not come without internal conflicts within the country, and the establishnient of a democracy in the true sense will not be achieved before other major problenis are overcome. For the _ . ^

Dominican Republic, however, developments within ^ ^ *

the past few days make if appear that the country has ViOtlOTl iVldllV

thrown off at last the yoke of the Trujillo government * U wOU VlW LiWll A AVAU J

and has launched out on a new course.

Obviously the new regime of President Joaquin Balaguer has the support of the government of the United States, and this country is prepared to send active military assistance to the new Dominican government if such is requested. The show of .S. power which appeared off the coast of the Dominican Republic this weekend, plus Balaguers assertion that internal strife could result within the next hors in a foreign military intervention . . . indicates clearly that the United States has committed itself to supporting the new democratic movement in the country.

Removal from power of carry-over officials from the Trujillo regime iniicates that the new government in the Dominican Republic still fears the possibility that the organization built under the old dictatorship still threatens the country. It also reflects that the new government recognizes the danger communist attempts to take advantage of a situation of unrest which always accompanies a major government change in Latin America. .

- What has taken place in the Dominican Republic

rammar irena Loan Agencies

By LYNN NISBET

LOANS The trend In the emell loan acency bual-neaa If following the same pattern as In banking, grocery store operation and numerous other boslness activities. The trend Is toward big chains absorbing the little independent operators. While there has been mucti more activity in the small loan field since beginning of the ar> ffuxnent over tighter regulations early this year, the trend is not yet as marked in this field as In banking.

in many instances the transfer of ownership has little ef-" feet upon the customers or the eommunity, because the loan agency continues to operate in the same quarters and more often than not with the same ma-nagera

. Another interesting development la that while the purchase and sales have resulted in a few more out of state operators taking over local business, by far the greater activity has been among foreign owners transferring title to North Carolina offices. _

OWNERSHIP The record of transfer of ownership of small loan office Is kept in the banking commission in two sec-tlons. One period is from January 1. 1961, to August 19. 1961. the effective date of the new regulatory act. The other period is for the time since August 19. From January to August there were 14 transfers of ownership involving 81 small loan offices. Prom August 19 to hate there have been 15 transactions Involving 24 offices.

The amount of money involved in these deals is not on record in the banking commission. It is the responsibility of that agency only to determine If the purchaser and prospective operator can comply with the legal requirements for protecting the public.

Further breakdown In the transfer to title shows that between January 1 and August 19 five NMth Carolina firms brought 14 North Carolina owned offices; four foreign firms brought 20 North Carolina owned offices, and five foreign firms brought 47 offices previously operated by other out of state owners.

Since August 19 one North Carolina firm has bought one

state office, and six out of state firms have bought 23 offices formerly operated by Tar Heels. Several of these had been affiliated with North Carolina chains.

These transfers In ownership result In the following status quo situation: There are (as of November 15 ) 599 local units or offices of small loan agencies. Of this number 266 are owned and operated by out of state firms; 233 are owned and operated by North Carolina chains (having two or more offices), and there are 100 entirely independent and individual North Carolina operations.

The total number of small loan units decreased by five during 1961. This decrease Was due chiefly to consolidations effected when chains took over independents. or in one or two Instances by local operators clocing down offices which were unprofitable.

REOU^iATION - Almost everybody from Governor Sanford and Banking Commissioner Ben Roberts all down the list agrees that the unall loan business needs stricter regulations than even the 1061 act imposes. Such control as is now provided by statute la divided between the Banking Commission and the Insurance Department, with some responsibility attached to other governmental agencies.

The 1961 act, which apparently nobody likes because it Is a hybrid legislative offshoot, did tend to stabilize the small loan business. Requirement for a $25,000 guarantee of lendable capital and a certificate of necessity and advantage from the banking commissioner protected the public against utterly irresponsible operators.

STUDY Governor Sanford has indicated be thinks this subject needs further study as basis for additional legislation next session. The banking commission and the small loan operators Join in the recommendation for further investigation. Any such study should start from soB*atch, not from the premise that big out of state firms are gobMlng up little North Carolina agencies. The trend In this field as In most business activity is toward consolidation and combination, and state lines have very little to do with de-vlopmenta.

The Dafly Reflector

INCORPORATED

Published Every Afternoon Except Sundaj BsUblished 1882 DAVID JULIAN WHICHARD, Publiihr

BitOTtd at Pott Offloa. OrocnvlUa, N O.. as aeoood claaa maf matUr.

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SUBSCRIPTION RATES By CMrrier (In Towns) Wools SOc

By Cnrrior (Motor Routoe) Wools SSc

BY MAIL, Poynblo In Adwnnoo

OracnvUle Pott Office. Pitt Oounty, Robartonvllle, Vanoaboto Washington and Chooowlnltf.

Tlirat hCootlis .........................

Six Bdonths tnO

On* Year ................................. UjOO

North Carolina (othar than Ustad ahovt)

Three liontln ........ 4JX)

Six isontha ................................. 1JS

Ont Yaar .................... I4B

All Other OuUlde North Carolina

Thra# Mootha $

Six llontlM Ont Yaar

laaoaooaaoooaaaaaaaaai

MBMItBB ASSOCIATBO PBBM

rha Aasodatad Prsat Is tatchislvaly anUUad to oat tor pubUcatSqn all nawt dlspatcbet credited to tyoi not otherwise credited to tbk paper and also the local oaw< published herein All rlfMe d pubUeatloo of epedaJ dlspatcbee bare are aleo ritMwad.

NATIONAL AOVBETUIINO BBFBBBKNTATIVB rbomat f Clark Oo. Inc., New York, Ohloafo. Atlanta M

May Have Overlooked

President Kennedys assertion that war or surrender are not the only alternatives to the cold war struggle between East and West reflects a conviction that many Americans have come to overlook in recent years.

Unfortunately, it seems to us, there has been a growing feeling among Americans that this country is unable to compete effectively with the Soviets on a long-range basis unless there is open conflict. Reports on Soviet economic gains, the inroads they have made in countries adjacent to the iron curtain, and the unrest they have caused in many parts of the world have tended to leave the' impression that they out-do us at every turn.

This <^is not the case, however. The economic strength of the United States places this country at a decided advantage when competing with the Soviets in the field of international trade. The universal appeal which democracy has for all peopie places the free world at a distinct advantage in its efforts to win new nations to the side of freedom and democracy.

The fear of tyrrany and oppression, which have been the trade-marks of communism, are not small factors in the struggle to determine which ideology will eventually win major support throughout the world.

In many cases, we think, the American people are selling themselves and their government short by thinking there is no alternative except to fight a hot war or surrender to communism. We can and we must compete. We must not allow ourselves to become complacent or over-confident in thinking that we have nothing to do but sit and wait for the world to come to us. And on the other hand it is just as dangerous for us to underestimate our own abilities to compete effectively. We cannot assume the fatalistic attitude that we are licked unless we pull out our nuclear weapons and fight.

It is not an easy thing to compete effectively in the cold war, but the United States has the ability and the resources to compete and do so effectively if it will.

A Coming Test ?or Easy Credit

By GEORGE SOKOLSKY

An ADDroach To Problem

AodU Bureau of ClrculatloiL

AU advcrtisifif oopf must M received at liMt ooe day AatA

By RALPH ROBEY

One of the clearly elated goala of the Kennedy Administration was to keep Interest rates low. The reason was to encourage expansion of business, and the rates were to remain low until we had reached full recovery. That would mean no tlchtenlng of rates for many months from now, because we still are far from maximum production.

This policy carried a strong Implication of criticism of the Federal Reserve System in past recessions. As a matter of fact, some of the Administration spokesmen openly stated that the Federal Reserve had choked off the recovery after the 1958 recession by unwise and too early restrictive credit policies.

Whether this charge is true -can never be definitely decided, even with the advantage of hindsight. All we know is that the Federal Reserve docs not take its responsibilities lightly, and when It moved to make credit less easy to obtain, the action was based upon the most careful analysis, a.nd the Reserve banks were convinced that they were operating In the best Interest of the nation.

When the Kennedy easy-money policy was made known, there was some speculation that it might result in a harsh controversy with the Federal Reserve authorities, and the question was raised as to whether Mr. Martin, chairman of the Federal Reserve Board of Governors, would resign If the Administration perslstedlnlts point of view. But that Is not the way It has worked out.

Rather, the Federal Reserve authorities have been most cooperative. Their Influence upon interest rates and the volume of credit Is primarily through the buying and selling of U. 8. Treasury obligations, although they also can change the rediscount rate and. within limits,-vary the legal reserve which commercial banks must maintain. Since the current recovery started last March there has been no change In the redis

count rate or in the reserve requirement. In other words, all the action of the Federal Reserve has been in the purchase or sale of government paper. Through this meclanlsm the free reserves of the commercial banks have been held at approximately $500 million.

The cooperation has gone even beyond this. For many yean the only Treasury paper the Reserve banks would buy was short-term. This was the "bills only," or "bills preferably, policy. Within recent months the Reserve banks have been buying a limited amount of longterm government paper. The unstated purpose of such buying on long-term bonds was to get a reduction of the Interest rate charged on mortgages.

Has the policy been successful In keeping credit plentiful and the Interest charges low?

Before answering this question one additional act must be mentioned. This is that the demand for credit, both short- and long-term, has been unusually low in this recovery. Because of this there has been no reason for interest rates to advance, and this probably has been Just as important as Reserve Board policy in keeping these charges at a low level.

But It does not follow that this situation will persist. Before many month.s the demand for credit will grow and this will exert an upward pressure upon Interest rates. In fact a recent survey shows that there already has been a slight increase in the rate on mortgages. The change is quite small but It was on the upside, and this may well mean that there la more to come.

It is widely believed, tooo,

that other rates also will move up before many months. At that time we shall have the real test of whether the Federal

Reserve Is determined to. keep credit easy.

- We think the decision wlll be that, in the Interest of the nation and the continued soundness of the dollar. It is nec

essary to permit a moderate rise of Interest rates-

Copjrrlght. 1961, King Features Syndicate, Inc.

The Kennedy Administration is making Itself clear that It is not anti-buiincss. The first important statement to that effect was made In a speech by the Attorney General. Robert F. Kennedy, who, discussing anti-trust en-' forcement, stated that it was not the intention of the Administration to harass business.

The Eisenhower Administration. while it^gave the impression of being dominated by businessmen. conducted a strong anti-trust policy, going after some of the largest enterprises. The anti-trust policy of the Admlnls-tratloB Is not only related to the economic but also to social conditions In the country.

Three distinct problems need to be considered in relation to this situation:

1. The capitalist system can only continue to exist If competition is active. The 8uppressi<m of competition by the formation of trusts is damaging to the capitalist system. The economic peril of trusts Is that prices are fixed and monopolies come into existence. Attorney General Ken

nedy takes the position;

*. . . I view the businessman who engages in such conspira^ cies in the same light as I regard the racketeer who siphons off money frOm the public in crooked gambling, or the union official who betrays his union member.

2. The moral factor in this situation is that we adopt a dual standard, forgiving the rich and important wrong-doer and punishing the poor and unimportant. After all. the businessman knows* when he is organizing In restraint of competition. Certainly his lawyer knows all about it. While in certain instances, there may be differences of opinion, In most, the organization of a trust is deliberate; price-fixing is deliberate. Those who engage in such activities have held meetings and discussed various problems related to a combination in restraint of trade. Their lawyers have advised them of the tolerable and Intolerable gimmicks. Their public relations councel have cautioned them. Therefore, if the organization of trusts and if price-fixing 1s against the law. the moral im-

Other Editors Saying... Must Go Slowly

(The Raleigh Times)

Governor Sanford has very wisely refused to be drawn into direct comment on the possibility of a special session of the General Assembly to consider urgent needs left unfilled by the recent defeat of the bond issues.

There are so many things which must be so carefully weighed before there could be any such special session without real danger of opening a real Pandoras box. Any one' who doesnt believe that there was real resentment on the part of thousands of people in the vote against these bond Issues. Just hasnt bothered to talk to the people themselves. Until that resentment can be resolved, until Its causes can be determined, until the people can get across to the leaders of this State Just why they feel as they do, there should be no thought of a special session.

There must be study, too, to find out Just where there was such spectacular failure to get to the hearts of the people with the real needs involved in many of these bond issues. The officials of the institutions of higher learning did work day and night during the bond issue campaign. They talked countless hours before countless civic clubs, but it is apparent that what they were talking about never really reached the people. Where was that failure? And why was it there?

There'are some now who feel that the Advisory Budget Commission should reassess the ur

gent needs which were not met when the bonds failed. Is the Budget Commission the agency to do that Job? After all, it is made up chiefly of legislators, and the members of the 1961 Legislature labeled all those bond issues as urgent needs. Would it be fairand politically practical to ask those same men to Judge again thfe very urgency on which they handed down a verdict less than a year ago? And if those very same men did hand down a new verdict of urgency, would the people believe them any more than they did on last November 7?

There are some who feel now that it is vital to have a cooling-off period, a period of time during which all the dust and at least some of the bitterness can settle down. There is much to recommend such a period.

The one thing which is sure now Is this; The leaders of North Carolina cannot again casually risk the cause of higher education as they did on November 7. There was a really casual air about much that was done or that wasnt donein preparation for that election.

The real needs of higher edu-. cation grow each day in our State, and they will continue to ^ grow during the time they will , be partially unmet because some of those bond issues werent approved. But it is better than they go unmet for a time than to run the risk of another defeat for education by rushing into something not carefully and prayerfully planned out.

r riend

Across

perative is to avoid such activities <x to get the law changed.

Attorney Genera] Kennedy says of this:

"When possible, I believe we should take action not only against the corporations and companies involved, but against the individuals who have participated in these frauds.

"I am against granting immunity to the individuals with the result that their cases end with their companies paying a fine. I think those responsible should be held responsible.

The third factor in this situa-tk>Q is the other side of the coin; big production cannot be handled by small enterprises. When, for instance, a company does a business of between $5(X).000.000 and $1.000,(KX),000 a year, the problems of capitalization and of managerial organization are different from those which involve a shop that does $10,000 a year. A company that employs 250,000 workers has labor problems that are different from a husband and wife store. Mergers often are essential to build an adequate agency of production. For instance, many electronic companies have recently come Into existence, each making some parts but not a sufficient variety of production to meet the growing needs in this field.

It becomes essential to form mergers to manufacture a imlt that meets the demands of the present situation. For instance some M the mergers are essential for the national defense because it is impossible to produce economically and to meet defense requirements. Small production can be very uneconomical and can add to the cost of the national defense.

This conflict between the law and the urgent needs of specific production has to be adjusted, but the place to make the adjustments is in Congress. The Executive official needs to en-forcet he law; if the people dislike the law, they, should put pressure upon Congress to change it. Usually the people want the law to stand but oppose enforcement if it affects them.

It seenvs to me that Robert P. Kennedy has offered business a distinct leadership in this connection a leadership which should be accepted with goodwill. This does not mean that there will not be differences of view on this subject or that certain businesses will not require special consideration.

But it seems at the moment that the Attorney General is approaching the problem rationally and that a combination of Attorney General Kennedy, Secretary of Labor Goldberg and Secretary of Health, Education and Welfare Rlblcoff can form a team that can work for the preservation of the capitalist system under the prevailing dire conditions.

By ROGER BABSON BABSON PARK, Mass., In these perilous times, it is a joy for me to discuss our nearest neighbor, Canada. A linemore than 3,000 miles long separates us and there is not a gun or any other form of "wall or defense on this very long line between us and Canada. This cej> tainly shows that some form of .nuclear disarmament should be possible for all.the world.

CANADIAN BUSINESS FOLLOWS U. S. BUSINESS Canada is now enjo3rlng a gradual recovery from the mild recession of a year ago. Industrial activity has turned upward, although to a modest extent. Canadian business, however, is subject to Intense competition caused by overcapacity and a corresponding pressure upon prices and profits.

For some time Canada has been a leading trading country, surpassed only by the United States, the United Kingdom, and West Germany. In the year 1962, export markets have accounted for about 15 per cent of Canada's nationl output. The United States currently exports only 4 per cent of its output. As a result, the Canadian dollar fluctuates,, and right now Is worth less than the American dollar.

CANADA AND THE EUROPEAN COMMON MARKET Concern has arisen that Canada's trading position may be hampered by the European Common Market. The great postwar impulse for multilateral trade in the Geneva Agreement on Tariffs and Trade is changing in favor of general trading blocs. The European Common Market may develop into a new nation that could rival the population. production, and power of even the United States.

I believe Canada should, examine carefully the above possibilities, and consider some form of association with Western Europe. Perhaps it should Join this European Common Market, a move which might eventually influence the United States to Join. This could result in a North Atlantic Trading Area of great strength to the "free world.

CANADA AND PREVAILING WAGES

Many in Canada feel that Joining the Common Marke^t would result in lower wages for Canada,, in view ofthe lower wages prevailing in Europe. However, efficient workers can demand and secure high wages. I further believe that such a united front would do much to prevent Communism from working further westward.

We cannot have everything we want In this world, and we must have a spirit of "give and :(akeeconomically, as well as militarily and politically. Also, Europeans should realize that only by including Canada can Western Europe extend its trading borders to the Pacific Coast. It seems as if this could be a great advantage to the Common Market. The very talk makes me very optimistic.

CANADA AND NATURAL RESOURCES Canada can supply Western Europe with oil, iron, copper, asbestos, sulphur, aluminum nickel, pulp and paper products, and even fishery products. One of the first projects may be to build a pipeline for crude oil from Western Canada to Montreal. Relations with Venezuela are now being cultivated by the United States. How this will affect Canads oil prospects is an open question.

Thus far. large sums of money have gone from the United States into Canada to help develop these natural resources. Very little of Canadas imported money has been for industrial goods, but mostly for investments or speculations in Canadas natural resources. OUTLOOK FOR THE FUTURE Factories may be built and go to decay; machinery may become obsolete; trade routes may change; but, at the worst. Canadas natural resources cannot be destroyed even though their exploitation may taper off for a few years. This means that Canada would profit from inflation, and Investments there could be a good hedge for those who are fearful of inflation.

In closing, let me remind readers that Canadas economic growth has taken only about fifty years; and with her present political, social, and economic structure, this excellent growth should continue. Hence, businessmen and investors should be optimistic about the future of Canada, even with radically changing world conditions.

Strength For Today

Before You Snicker At Lobei

By EARL L. DOUGLASS NATURE OF FAITH

Most people regard faith simply as the capacity and willingness to' believe certain things. 'The Bible teaches certain truths. We believe those truths; therefore, we say. we have faith.

But this is not the Biblical idea of faith. Faith involves be* Uef, but faith goes far beyond belief. We are told in the Epls-tit to the Hebrews (11:1) that faith Is "the evidence (A things not seen. or. "the giving of substance to things hoped for. In other words, faith is a spiritual power. It is a capacity of heart and mind which inablet us to create something->to give it substance. By having faith that ew can do certain things, we help bring, those things to

pass. By praying to Ood and then having faith that He wUl answer our prayers and grant our petitions, we cooperate with Him in the fulfillment of these desires.

Faith Is the cspaqlty of the human heart and mind whereby we assist Ood in His process of creation and achievement. When we have faith, we become channels through which Gods power flows. Let us not believe that Just because we believe the Bible, and the creeds, and attend church, that we have faith. We have faith when we trust God and let His power flow through us. And when we do this, we and God Himself become partners In projects which lead to triumphant achievement.

Faith Is the giving of substsnce to things hoped for.

By ELMER RLESSNER

The Japanese, in their drive to sell specialty foods to gain dollars with which to buy staples, are offering a Worcester (not Worcestershire) sauce through the Japan Trade Center in New York.

The literature deacrlbes It thusly;

"As the base material for Japanese . Worcester Sauce, soup made from fresh onions, garlic, tomatoes, and celery together Is used. The said soup is seasoned with salt. "Vigar, honey, pure smlno acids, soybean sauce and vinegar, and then it is made hot with pepper and capiscum.

"A further addlUon of spiced vinegar to the above mixture finishes the preparations of Japanese Worcester aauce.

"Among various kinds of spices the rhost populare are eaUve cinnamon of Ceylon, clove grow

ing In Indo-China. vanilla, sage, mace in Inanoesia, and allspice in.Central America, all of which are got from root. bark, on seeds of rare plants grown in the tropical and subtropical zones.

"These spices, when mixed properly with the special vinegar (acid liquid from fruit) come to give a unique aroma.

"The history of Japanese Worcester sauce dates back as far as 1896 when Kojiro Kimura first made a sauce in Osaka. According to the history, he learned the sauce making process from C. T. Davis, an Englishman, who was a chef for an English ship.

Before you start snickering at the Japanese, read the Isbel of the most popular American-made Worcestershire sauce:

^Prepared from soy, anchovies. eschalots, onions, tamarinds, garlic, vinegar, water, sugar.

epices and flavoring. Get that: after Lee puts in soy. anchovies, eschalots, tamarinds, garlic, vinegar. sugar and spices, Perrins flavors it I

WOMEN BULK LARGER AD MANAGER SAYS

Marlon Hllker, advertising manager of the H. W. Gossard Co.. told a sales promotion convention In Chicago that women are bujrlng bras about a size longer than they did ten years ago. and buying girdles about a sise longer. Sales of panty girdles, she said, have almost doubled In the last seven years but demand for regular has fallen about a third.

York, Boston, Los Angeles and San Francisco.

Your government announced, on November 2. that it had bought 5.174.325 pounds of canned chopped meat and 2,688,000 pounds of frozen ground beef an that on November 8 it bad bought 3.864,000 pounds of frozen ground beef.

We seem to be keeping ahead of those Australians.

AUSTRALIA SHIPS BEEF TO MAKE UP FOR SURPLUS Your government announeed that four ships left Australia between October 10 and 17 with 1,809,938 pounds of beef for New

AFRICA HAS LOTS OF EARTH TO BE MOVED Theres a big market for earth-moving machinery in Africa. according to Hugh H. McGregor, director of ProducUon-Englneering Ltd., of London. However, he told a meeting at, the WjtU Street Club, American firms must teach Africans efficient ways to utilize the machinery. CosU are tripled if it is idle 75 percent ol tM time, be obeerved.