Garden City Telegram from Garden City, Kansas • Page 9

AMC Will Get Big Tax Rebate By JOHN CUNNIFF AP Business Analyst NEW YORK (AP) In its battle for survival the deficit ridden American Motors has received bank terms that Would he refused richer companies and now, in addition, it will Kct a tax break that nobody else van obtain. The company, which recently leported a fiscal year loss of $75.8 million, soon is expected to leceive a second extension on repayment of a loan that originally totaled $95 million. Hie banks seemingly have no choice but to extend. Almost simultaneously, congressional action this week will mean a big tax rebate for tne company, a gift that may total as much as $20 million, pnly American Motors can obtain a rebate through this unique legislation. The bank loan was extended last when the troubled company, th -nation's fourth largest automaker, neared bankruptcy.

The loan, totaling $95 million, was extended by a group of 224 banks. Last May, when the loan was to have been repaid, these banks granted an extension on American Motors' promise to sell a subsidiary and use some SHOP LATE! CHRISTMAS DUCK WALL'S of the money to reduce its Indebtedness. This American Motors did. Now the company still owes ihe banks $60 million and still it barely afloat in a sea of red nk. Payment day is Dec.

31, and it appears the banks will again extend the deadline, for they cannot sink the company. The tax action, which has jeen approved both by the House and Senate, also has been tailored specifically to American Motors' problems. The tax provision concerns a section of law which permits operating losses to be applied as a reduction on taxes already paid in more profitable years. The new legislation will enable American Motors to apply its present losses against taxes paid in the previous five years. This is an extension of two years, a benefit that no other company can obtain.

The widom of this move now is being questioned by businessmen who certainly would like to have the same breaks. Is this legislation fair to other corporations? Can Congress so easily give preferential treatment? Though based in perhaps the mast humane motives, the action is provoking a lot more questions also. Is it fair to other taxpayers, to productive individuals and enterprises who theoretically must pay a disproportionate share of taxes to support a losing enterprise? Isn't it the free enterprise credo, With reservations dictated morality, charity, civility and progress, that the less efficient concerns should fall by the wayside as the productive and efficient advance? Proponents of the tax measure can muster some very cou- MIRACLE SOFT WATER dear and your bucks well tpwit! 612 St. Join. Garden City BR 6-7345.

No obligation DelLoyd owaer vincing arguments. American Motors employs close to 28,000 workers whose jobs would be jeopardized by financial failure. Its 2,500 dealers would be endangered. Hundreds of suppliers would be hurt by bankruptcy. Shareholders would lose equity.

Automotive competition would be reduced. The present plight of American Motors may not be the result solely of its own internal Poqt Grsritan Cily Thursday. Dec. 14.1967 problems, but a very strong case can be made for mismanagement. Why, the'critics ask, should A once profitable company have fallen into the red at the very time auto sales were reaching record high levels? Why should American Motors, which profitably developed the smaller car market in the United States, now see it taken over largely by foreign imports, whose sales are 15 to 20 per cent higher than a year ago? U.S.

Sources Sure Red Pilots Flying for Yemen By JOHN M. HIGHTOWER WASHINGTON (AP) Some well-informed U.S. officials are convinced Soviet military pilots have been flying combat missions for Yemen's Republican government against Royalist forces attacking San'a, the capital city. This reported involvement of Soviet fliers, using Soviet-made planes and supported by Soviet ground considered here to reflect Moscow's desire to establish power positions in the Middle East, once the exclusive domain of Western interests. The possibility of Soviet fighter participation was raised a few days ago when a Royalist information minister said the body of a Soviet pilot, carrying Russian-language papers, had been found.

In official quarters Yemen has considerable strategic importance because with the neighboring region until recently known as dominates the 12-mile- wide southern gateway into the Red Sea. It has a commanding position on the Suez Canal, Unking the Mediterranean and the Indian oceans. The canal has been closed since the June war between Israel and the Arab states but is expected to be reopened eventually. erations is yet to be determined, they caution. The war in Yemen is between the Republican regime and Yemeni Royalist forces which took to the hills in September 1962 when the monarchy was overthrown.

The struggle has been going on, with periodic eruptions of violence, for five years. But two recent developments changed the political framework in which it has been conducted. President Gamal Abdel Nasser of Egypt pulled out the last Washington authorities say his Soviet-armed troops, which once totaled around 70,000, as a result of a deal with privately they can't recall conflict similar to that in Yemen in which Soviet pilots have played such an active There have been reports of such involvement in the past in troubled lands, but in the present case responsible policy makers say they have no doubt in Washington, it is said there's the information is true. Whether no doubt the downed airman this marks th beginning of a was a Soviet. new phase in Soviet foreign op- OTASCO BEST SELECTIONS LOWEST PRICES "MARSHAL" DOUBLE HOLSTER SET CORN POPPER GIFTS FOR HER Leather double hol- tter, belt, silver bid- lets, 2 T6peatirig neckerchief.

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