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Wednesday, July 30, 1969

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Keep This Surplus From Spenders

After years of deficit spondiii}? by the federal TOvernnient the reported $3.1 billion surplu.'i for the fiscal year 10C8-69, if it is rated a.* a surprise, niu.st be classified as' a pleasant Diie.

The size of the surplus startled *ven the hud-pet makers and treasury officials who hati |ncen forcastinp a surplus of less than a billion.

Officials said the surplus was due to individual income taxes runninp $2.8 billions above estimates. Corporate taxes were $1,4 billion below estimates.

Whatever the reasons the sur)dus was a preat reversal of the $25.2 billion deficit of last fiscal year and a welcome chanpe from the eipht years of deficits the fetieral poyernment has seen.

Since deficit .^penduhff' by the federal povern-ment has I'oen feedinp the roarinp inflation which has-pripped the nation forJiOmeJinie now. we^predict that the surplus this year and one planned for

next will have the effect of cooling down the inflation which is robbing every paycheck. That is, this is true unless the spenders can find ways to get their hands on the surplus funds.

There are plenty of schemes for greater spending of federal money and some of them, of course, are justifiable. However, w'e consider the bringing of inflation nnder control the prime priority for the nation right now. There are signs that inflation is going to he brought under control without upsetting to any great degree most of the progijams now being carried on by the federal government. However, any sudden increase in federal spending that threw' the federal budget back into a deficit could undo all that has been done to control inflation.

Inflation became a problem because the government waited too long to do anything about it. Now something is being done and the brakes are being ridden pretty hard. Part of the inflation fight is to create a surplus in federal funds, but a surplus is like honey to the spenders. Responsible government officials should see that inflation is brought under control before the spenders are turned loose.

NC. Fairylanc.

Of All SeQSOnS Qqq(J Tobacco Prices

Are Certainly Needed

By WILLIAM A. SMIF.LS Rofleclor Raleigh Bureau

ASHEVILLE - 11 was raining on the heights of the Itfue Ridge and mist, fog and a light rain enveloped the highway as we reached the foot-hiU'.

Just ahead was the Blue Ridge escarpment and the towering peak.s of the Black mountains and the craggies.

Cki a clear day the view is one of grandeur and mountain majesty, of which all of North Carolina is proud. These areas to the east and west, north and south of Asheville, the highest, most rugged mountains in the Eastern United States and probably the most beautiful anywhere because they are frosted, and lush and green in .summer.

In the winter they become a fairyland of snow, ice and rime.

Seasons Tiiere are more visitors during the summer, the so-called tourist season. But the most famous season for Western North Carolina is the color season, when the leaves turn to purple and gold scarlet and brown. W'hen the winds blow from the heights, they fall and add to the richness of the dark mountain soil, a visual promise of more mountain flowers and greenery when Spring comes again.

This has been a wet, rather warn and humid summer season in the mountain country.

It is better than drought,' says a national park agency official. The area suffered severe summer drought conditions for the past several years and last year was the worst.

Region There is a sense of expectancy and excitement as one approaches the mountains, perha^^ such as early settlers of western North Carolina experienced as

they climbed.

Clothed in clouds and spattering rain, and drifting wisps of fleecy fog the escarpment beyond the Catawba valley assumes an aura of mystery and wonder, feeyond the overlooks there is a .sea of white invisibility. But the mountains and deep gorges are there silent and serene, reaching higher and higher.

On the escarpment, in a mountain-rimmed bowl, is the city of Asheville, our destination and the site of the annual summer meeting of the North Carolina Press Association. It is the most populous city of tlie North Carolina Press Association. It is the most populous city of the region and its economic, cultural and social influence reached more than lOO miles from all points of the compass. Asheville thus is the hub of the western mountain region in many ways.

City The city itself i.s a gem in a scenic setting but not unlike other expanding population areas it has its haws.

Reaching Asl>eville through its siiburbh.sort towns is difficult becau.se of highway problems. lnterse<tions and stoplights in Black Mountain may back up vehicle traffic for more than half a mile. On a hot day this is distressing to any traveler.

Entering Asheville itself, conditions on Tunnel Road are simply terrible. There is little if any orderly traffic control and traffic jams are enormous. It is an area of shopping centers, motels, restaurants, tlicaters and drive-ins ifnd unlimited access along with une(K>rdinated stoplights.

A weary tourist may wonder whether he has entered an obstacle course by the time he reaches old. two-lane, pcwrly lighted Beaucatcher Tunnel.

Bottleneck - This is one of Ashevilles bottlenecks. Only one. There are others. One or two are being fixed. Relief for others has been promised but there is i.o definite timetable. Going east of Ashevilles expressway is almost as bad because a four-lane highway narrows to two lanes at the tunnel and cars stack up in long lines waiting to make an alternate merge.

The $70.79 record opening day average on the Border Belt hopefully precedes record prices on the big Eastern Belt when it opens next month.

The weather has not been all that one could ask in this area this year. There has been some hail damage and too much rainfall early in the season. Still there is mpch good tobacco in our area and farmers will be looking for a good price for it when they place it on sale.

We cannot recall a time when tobacco producers needed record prices more than they do now, for, after all, the farmers are having record expenses in growing their crop.

i^evolt Within Aanks Of GOP

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By ROWI.AND EVANS

& ROBERT NOVAK

WASHINGTON-The rising mood of revolt among liberal Republicans and the reasons why it is spreading into not-so-li'beral ranks were dramatized by a recent cl(ed-door meeting of Senate Republicans.

denly became political drama when Sen. John Tower of Texas, a conservative power in both the Administration and Senate, rose to challenge liberal Sen. Charles E. Goodell of New York.

Goodell, said Tower, had strayed far off the party reservation and was damaging his President. But before Goodell could answer, freshman Sen. Robert Dole of Kansas, an organization man with gilt-edged conservative credentials, jumped up to indicate some support for Goodell.

President Nixon would be a great President. said Dole. The trouble is that the people around him are stupid.

This unexpected criticism was followed by a moment of .silence. Then Sen. Jacob K. Javits of New York, Mr. Liberal Republican in the Senat, joined tlie attack. Although th^ wasn't a single thing the Nixon administration could do to hurt him in New York, said Javits, there was much that he could do to sell the President to New Yorkersif only the Administratiim gave him half a chance by adopting more liberal policies.

Thus were revealed two principal ingredients of the revolt. Liberals feel that t h e conservative point of view is getting too much attention at the Nixon White House. TTiese same liberalsand some conservatives such as Dolefeel he is getting bad advice from his inner circle, quite apart from ideology.

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CliiefWe Just Foiiiid Sohk' ^lliin: Else Floaliiij' in >aiiliickel SouikP

ART BUCHWALD

Here For All Marskinc.

That is why half a dozen freshman Republican Senators (not including Dole) have set up an informal organization. Its purpose is not, as has been reported, to plot against their Senate leader, Everett M. Dirksen of Illinois (regarded as too powerful to strike). Rather, they are plotting to put pressure on the White House and move it to the leftin short, to give the President a liberal source of advice.

These freshman insurgents are anything but woolly-headed liberals or left-wing ideologues. Indeed, they are products of minor league Republican training. Sen. William Saxbe of Ohio, a leader in the new group, came here as a dependable member of t h e tightly disciplined Ohio organization and served an apprenticeship as Speaker of t h e House in Columbus before becoming State Attorney Generalhardly a preparation for .softheaded liberalism.

") But Saxbe has moved leftward in Washington. I never knew 1 was a liberal until 1 got into the United States Senate, Saxbe told us with wry humor. His main allies in the new insurgent group are Sens. Charles (Mac) Mathias of Maryland (accused 10 days ago by fellow Marylander R(V gers Morton, Republican National Chairman, of trying to undermine the Nixon administration), Richard S. Scheiker of Pennsylvania, and Marlow Cook of Kentucky. Others join their irregular meetings, but these four comprise the core. The immediate cause of tlieir banding together was the succession of defeats tor liberals inside the Administration a month ago. But beyond that, their efforts are directed against the official they re-(Continued On Page 6)

WASHINGTON - As I watched the two American astronauts on television go through their paces on the moon, I couldnt help thinking:

Suppose two Martians named Neil and Buzz made a space trip to this world and by accident landed in one of our citys parks.

A cop drives up. Hey, you guys. Get that piece of junk out of here.

Its not a piece of junk, says Neil. Its an earth module.

Yeah, well I dont care what you call it. Youre not supposed to put up nutty sculpture in the park. Were only going to be

here two hours and 40 minutes, Buzz says. Its very important that we get earth samples for our scientists to study.

Cop asks suspiciously, What kind of samples? Earth samples, Neil says. You see, I take this little scoop with the plastic bag on

Other Editors Bay

Is Georgia Leaf Better?

ART

BUCHWALD

(Henderson Dispatch)

This is merely posing the question, not answering it. At the same time, official records are not to be ignored. Is it tru| that Georgia-Florida tobacco IS better quality and more desired by manufacturers than types grown farther north?

Growers in the far southern belt have been claiming this in recent years. They cite the higher prices that are paid, and they have the facts on their side, at least from one standpoint.

Look at the reports. Through last Friday, sales had been in progress only three days. The only comparable markets are those of South Carolina. The average price on Floridas five markets was $7192 aer hundred pounds. The average for Georgias 23 markets was $70.59.

Border North Carolina operated only an hour or so when an abortive effort to open was made along with the southernmost areas. These may be eliminated because they do not afford sufficient evidence. But take South Carolina, which did open along with Georgia-Florida and has been

operated since. The eleven markets there had an average of $69.91. That is about one cent per pound under Georgia-Florida.

Weather conditions are always a factor in producing qualify leaf. But do the earlier belts always have better weather?

What is said here is not to disparage price averages in Eastern North Carolina and the Middle and Old Belts. But do buyers take so mu<:h leaf in the far south that they are not as eager when sales move up this way?

These are some of the factors that could enter into any evaluation of trends. It is not to concede advantage to Georgia, but merely to recite records. The season has hardly gotten under way as yet, but if precedent is followed the records by comparison may not vary too much.

The far south has not been in the tobacco business as long as North Carrolina l?elts have been. Could it be that soil conditions have been more depleted here, or that vagaries of the weather are more a concern? We are merely posing the question, not actually drawing conclusions.

the end and dig it into the surface like this, and then I put the bag in the p(x:ket of my space suit.

Youre pushing pot! the cop yells.

We dont know what pot is, Buzz says. But were supposed "to pick up rocks and put them in a box And then, the cop says, after you put the rocks in the box, youre going to take off in that crazy piece o f sculpture?

Affirmative, says Neil. But first we have to put the plaque up.

What kind of plaque? the cop asks he takes out his notebook.

Its a plaque which says, We came in peace for all Marskind.

I get it. Youre a bunch of anti-Vietnam peaceniks. Where are the rest of the creeps?

There only Mike, and hes flying around 100 miles above us, waiting for us to come back.

The cop looks up. Mike is (Continued On Page 5)

xtra Moneys In Bank

By JOHN CUNNIFF AP Business Analyst

NEW YORK (AP) - Perhaps it has never happened to you, but in your dreams at least you can imagine how it feels to be told by your bank that you really have $100 more than you realized in your checking account:

Something of the sort has been the good fortune of both the United States and Britain this month. And in both instances the discoveries came when the atmosphere was bleak indeed.

Nothing, that is, concerned the Nixon administration rnore than achieving its widely pi bli-cized goal of producing a Ihi< Iget surplus. It appeared nip and tuck, for the apparent sur )lus was less than $1 billion, a ps Itry sum.

Now the Treasury has discovered that, unexpectedly, it has collected $2.8 billion more in personal income taxes than fwas foreseen as recently as last April, pushing the budget surplus to well over $3 billion,, a respectable figure.

Britain found its good fortune in underestimating its exports, one of the critical areas of its economy. And compounding the good fortune was the fact that . the same error has been made every year since 1964;

As many Americans and all Britishers realize, that nations economy has been in the doldrums, one of the reasonsor effectsbeing that exports have not been strong enough to produce an inflow of cash.

The Board of Trade made a mighty contribution to rectifying that poor situation earlier this month when it announced that it had been underestimating these exports by between 2 and 3 per cent.

Certainly this isnt going to correct the imbalances in the British economy, but it does mean that the country was better off by between $24 million and $36 million a year since 1964. And it provokes interesting speculation.

Did Britain act too hastily in reducing the stated value of the pound sterling from $2.80 to $2.40? One of the reasons for so doing was the distressing figures that showed big imports and small exports.

It is unlikely that the errors would have meant the differ^ ence between a strong pound and a weak pound. But in soma monthly reports the errors could have meant the difference between a poor export month and a terrible one.

Equally interesting is the speculation on the U.S Treasurys error. If nearly $3 billion more than was expected was taken out of the hands of American consumers, why in tb world didnt this have more of an impact?

In other words, why wasnt the decreased spending power of Americans more obvious in reduced sales of, let us say, automobiles and mutual funds and clothing, and in lower expenditures for travel and vacations?

The explanations are perhaps as common as errors. One reason, it is safe to say, is that incomes also were a bit higher than forecast, and higher incomes sometimes mean higher taxes. Another is that savings were dipped into.

But an entirely unprofessional explanation of why taxpayers can part with their cash and still continue to spend, is that errors were made on the other side of the ledger also.

That is, while the government was siphoning money from tax-(Continued On Page 5)

Strength For Today

Oil Lobby 'Hasn't Quit Fighting

A Prophet Cries Justice

One of the most popular Biblical figures is the Prophet Amos. He appeals particularly to people of our own day because of the emphasis he makes on social justice.

Amos was a shepherd living in the kingdom of Judah very near n^o the town of Bethele-hem] The prophetic ministry of Amos is usually dated about 750 B.C. Although Amos was a subject of the Southern Kingdom of Judah, he w a s called to j)rophesy in the Nor-tliern Kingdom of Israel. 'Phis humble shepherd was a .mo-notJieist, holding to the reality of the God of creation and providence, the sovereign ruler of individuals and nations. Amos on one of his trips int the Northern Kingdom observed the evil of tlie people with whutn he came in eont,u't during his travels ond the injustice with which those in high

station treated the poor and the dissolute living of all who could afford that sort of existence. He stood up, probably in the marketplace, and cried out bitterly against injustice and evil living.

The most fomous passage in the Book of Amos deals with God's judgment upon those who pretend to be religious and yet trample upon the right of their fellow men. I hate. says tiie Lord, I despise your feast days, and will not attend to your solemn assemblies. Though ye offer ' me burnt offerings and your meat offerings I will not accept them . . . .Take thou oway from me the moise* of thy songs; for I will not hear the melody of thy viols. But let judgment run down as waters, and righteousness as a mightv stream lAmos 5 21-24).

By Earl L. Douglass

By ELMER ROESSNER

The oil lobby has largely, but not completely, given up the fight to maintain the 2714 per cent oil depletion allowance in the Hcuse of Representatives, following the 18 to 7 vote in the Ways and Means Committee to cut the allowance |o 20 per cent, which saves a lot of taxes.

It is now' concentrating its efforts on Senators.

Of course, anything can happen on the House ^ floor, but observers think that t h e House' will accept the 20 per cent figure. Representatives, except those from the o i I states, have been under considerable pressure. Ccmstitu-ents, facing rising taxes and . prices, are inrrea.singly resentful of what appears to be a tremendous tax loophole. To vote for a continuation of the ^ depletion allowance could be \political suicide for some. The .Next Fight

However, tlie oil lobby is working on tlie Senate. While

some Senators are under as much pressure as Representatives, the lobby thinks the Senate .may vote for a smaller cut and, in the quiet of a conference, House members may go along with the Senate.

The oil industry has a pretty good argument that has been overlooked by many of those who are demanding a cut in or abolishment of the allowance. It is this:

Manufacturing industries get a depreciation tax deduction. After a corporation builds a new plant, it can accumulate a tax-free reserve to replace the plant when it wears out. But it would be impossible to calculate the'depreciation of an oil well.

If an oil company spends $70,000 to drill a well, it might get anything from a dry hole to a well that runs out in six months or to a well that gushes for 10 years.

A Simple Sohitiou

Becau.se of the diifieulty in calculating oil well deprecia

tion, Congress in 1926 invented the depletion allowance and set it at 27 per cent by pure guess. It also set similar allowances, at varying rates, for other minerals.

Instead of hammering away on this argument, the oil lobby

BJNRR

ROESSNER

and its publicists 'have been using scare tactics. The Pe-troleiKH Industry Research Foundation has been warning that a cut in the depletion allowance mfght lead to higher gas and oil prices. Frank N. Ikard, president of the American Petroleum Institute, said .-that a cut in the allowance would impede the industry's

ability to raise $200 billion in new investment money to meet the additional demand for petroleum products over the next HI years.

John D. E.merson, economist for the Rockefellers Chase .Manhattan Bank, stated that the present allowance is necessary to encourage producers to develop their own reserves. He is right; one of the reasons for the allowance was to encourage the development of larger oil reserves. Kenneth E. Hill, an investment banker outside of the oil industry, stated that a cutback in petroleum activity could cause depressed conditions in oil-producing states.

It is a bit embarrassing for the oil industry to have the ^ battle joined just after Ohio and New Jersey Standard, Gulf, Cities Service and Atlantic Richfield liave reported substantial increases in first-half earnings, although Shell and Sun reported declines in profits