Galesburg Register-Mail from Galesburg, Illinois on July 30, 1973 · Page 4
Get access to this page with a Free Trial
Click to view larger version

Galesburg Register-Mail from Galesburg, Illinois · Page 4

Publication:
Location:
Galesburg, Illinois
Issue Date:
Monday, July 30, 1973
Page:
Page 4
Cancel
Start Free Trial

Page 4 article text (OCR)

E L w 1 i - 1 / V 1 L M 8* it* it* M *8 9* m 4* •» iW •» OS *• f* *•» Ml •i» ** ^* «f V* ** ** a* IS ** mi 5V - • -M. 4st \ Phase 87 Another Catch 22? Good As bly guessed, this press conference was called to announce the beginning of Phase 87 in the President's program for economic recovery. know know I'll just dispense with my explanatory statement and get right into the questions. Q: Mr. Secretary, we know conditions are always changing, but don't you think it's a little soon to go into a new phase when you just announced Phase 86 this morning?, SCHULTZ consumer index went up 18 per cent between 9 and 10 o'clock this morning. We always try to react so that we can stop inflation before it starts, more or less. Q: Many consumers are complaining because the price of a dozen eggs has risen this SCHULTZ contents who would like to paint the situa- terms think ving economic system And r incidentally, my researchers tell me that in the food area, cake is a good buy this week, Q: Can you tell us how Phase 87 will be different from Phase 86? A: For one thing, it is one point higher, F and I think you wity admit that there is a poetic justice in the fact that the phase numbers are being inflated, too. More importantly, though, the President has decided ^ to get really tough with big business and slap a limit of 1 per cent profit on all manufacturers in the areas of buggy whips, hula hoops and spittoons. Once we get these crucial areas of the economy cooled down we L can think about lifting the ban on paying wages that was instituted during Phase 45. Q: About that ban on wages — I haven't eaten for a week and I wonder if I could borrow $50 from you until this phase is over? . 4SCHULTZ: Somebody find an IRS agent to arrest that man on a charge of being an inflation-monger. That's the problem: Nobody wants to do his part. I, for instance, have aided the balance of payments by sac? rificing my favorite snack, imported Bolivian anchovies. Now if I can do that I don't see why the rest of you can't pitch in. Q: What has President Nixon done to cut down? SCHULTZ: He has saved on electricity by pulling out the plug on his television set. Q: How does Phase 87 relate to the traditional Jaws of economics, our competitive system and supply and demand factors? SCHULTZ: God only knows. And as you recall, He was frozen back in Phase 64. The High Cost of Borrowing EUROPE'S CENTRAL BANKS complain that they have too many dollars. American banks and savings and loan associations say that they have too few. So the federal government has taken a number of interrelated actions to make thrift more rewarding for the ordinary citizen. The booming American economy is rapidly shifting from a spender's to a saver's market. It all began on June 29, when the Federal Reserve Board raised the discount rate the fee it charges for loans to member banks from 6.5 to 7 per cent. The discount rate had not reached such heights !| since 1921. Even during the credit crunch of 1969-70, it never went beyond 6 per cent. When the discount rate climbs, commercial lending rates are sure to follow. Thus, it came as no surprise when three federal financial regulatory agencies announced on July 5 that commercial banks, savings banks, and savings and loan associations would be permitted to pay higher interest to savers. At the same time, the maximum • interest rate allowed on home mortgages backed by the Federal Housing Administration and the Veterans Administration was raised from 7 to 7% per cent. THE NEW interest-rate structure for tiqie deposits simply raised existing ceilings. But the Federal Reserve Board also created an entirely new type of savings instrument the four-year, $1,000 maximum ac<Wtfii on which banks may pay as much interest as they please. The ^ramble already is on to lure savers to this new money-maker. In Los Angeles, for example, the Bank of America immediately announced that it would pay interest of 6% per cent on such four-year accounts. Union Bank and Manufacturers Bank immediately topped that with offers of 7 per cent. One New York bank is promising an effective annual yield of 7.9 per cent on $5,000 deposits, MEANWHILE, the business community is beginning to feel the pinch of higher borrowing charges. The banking industry's prime, or minimum, interest rate on loans to large corporations has risen to 8% per cent, and a further increase to 8% per cent is considered all but inevitable. •'Tight money always kills a om, says William Ericson, president of Chicago's American National Bank & Trust Co., "and we believe the liquid positions corporations had are used up." He adds that "Big banks such as ours are being forced to ration business loans, especially acquisition loans." THE MULTI-BILLION "Eurodollar" market may also weaken the Fed's tight F money policy. Eurodollars are, in effect, "expatriate" American funds held by individuals, by American and European companies, and by foreign governments. Because there are no reserve requirements on Eurodallars, they are the most usuable form of funds that big American commercial banks can obtain quickly to provide their customers loans during periods of credit- tightening at home. The Guaranteed Student Loan Program (OSLP) was established under the Higher Education Act of IMS td provide young Americans with the means of borrowing to finance part of their post-secondary education, Through the OSLP, a student may borrow up to $2,500 each academic year up to a maximum total of |10,000 extending through graduate school. He may enroll in a variety of post- secondary educational institutions, including vocational and trade schools. AT THE CORES of the program is the Issuance of student loans by participating lenders, with the loans guaranteed by state or private nonprofit agencies or insured by the federal government. The U.S. Office of Education estimates that since 1965 more than three million young men and Women attending nearly 7,000 eligible institutions have benefited from these loans. About $4.5 billion in insured student loans is currently outstanding. From the beginning, however, the GLSP has been hampered by the problem of "liquidity"there has been no secondary market for student loans. More- College over, loan repayment* are often deferred for relatively long and uncertain periods of time. Repayments do not commence until 9 to 12 months after I student complete* his education and can be suspended by service in the military, the Peace Cms or THE RESULT has been a decrease in the flow of funds Into student loan* in recent months. % remedy this situation and to enlarge the economic oppor* (unities for lower- and middle- income youths to attend the schools of their choice, a government-sponsored private cor* poration has been created the Student Loan Marketing As* sociation, or 11 Sal lie Mae." The hew corporation is designed to establish a secondary market in student loans and expects to tackle the liquidity problem in two major ways: By the outright purchase of student loans and by making advances to eligible lenders using their portfolios of student loans as collateral. SALLtE MAE plans to obtain funds for its initial operations through the shares of sale of 700,000 stock in common mid-August. A nationwide underwriting group will be co- managed by Lehman Brothers, Merrill Lynch, Pierce, Fenner & Smith, and Morgan Stanley & Co. The law under which Congress chartered Sallie Mae requires that advances acquired by lenders be channeled into additional student loans, thus enabling more students to obtain the educational financing they may need. A TRUCE has been declared in the war against the crown- of-thorns. Empty Trucks Can Cause WASHINGTON - Despite a gasoline shortage that will grow worse in the next two years, trucks waste hundreds of millions of gallons each year. The loss has been estimated by experts as high as 400 million gallons. EMPTY TRUCKS leave cargo piled in the warehouses while other empty trucks come to pick up the loads. Not only does this waste diesel fuel but it boosts the prices that consumers must pay for transported goods. At a time when food prices are soaring out of sight, for example, the trucks that haul foodstuffs in one direction of- Comment *v - By Jack M Anderson ten go back empty although loads are waiting for shipment. The cost of moving the empty trucks, of course, is added to the price of f i Kill Executives of the Food Fair supermarket chain told us they could reduce food prices $7 million a year if they were permitted to utilize the empty trucks. And this doesn't count all the fuel that could be saved. Yet, believe it or not, the waste is caused largely by the Interstate Commerce Commission, which is supposed to protect the public. ICC rules often force truckers to haul nothing but air while cargos beg for shipment. A TRUCKER may ship frozen vegetables in one direction and return empty, for example, if 4 he lacks certificates to carry cereals or fruits. Even worse are regulations requiring trucks to pass through "gateway" cities. To obey required routings, carriers must often swing off direct highways and go miles out of their way. These regulations increase travel mileage an average five to 10 per cent a trip. One food hauler, the Refrigerated Transport Company of Atlanta, has set its unnecessary mileage at 15 per cent. Attorneys for the company claim the firm's trucks needlessly guzzled over three million gallons of diesel fuel last year alone. "The cost to the consumer," © 1973 fcy NEA, Uc. ,, / know, Daddy — tell me the Watergate storyl" er-Mail Office no South Prairie Street Galesburg, Illinois! 61401 TELEPHONE NUMBER Register-Mail Exchange 343-7111 Entered as Second Claw Matter at the Post Office at Galesburg, Illinois, under Act of Congress of March 3, 1879. Daily except Sundays and Holidays other than Washington's Birthday, Columbus Day and Veterans Day. Ethel Custer Pritchard, publisher; Charles Morrow, editor and general manager; Robert Harrison, managing editor; Michael Johnson, assistant to the editor; James O'Connor, assistant managing editor. National Advertising Representatives; Ward Griffith Co., Inc., New York, Chicago, Detroit, Los Angeles, San Francisco, Atlanta, Minneapolis, Pittsburgh, Boston, Charlotte SUBSCRIPTION RATES By Carrier in City of Galesburg 50c a Week By RFD mail in our retail trading zone: 1 Year $16.00 3 Months $3 21 6 Months $ 9.00 1 Month |2.0U No mail subscriptions accepted tn towns where there is established newspaper boy delivery service. By Carrier in retail trading zone outside City of Galesburg 50c a Week By mail outside retail trading zone in Illinois, Iowa and Missouri and by motor route in retail trading zone: 1 Year $22.00 3 Months $6.00 6 Months $12.00 1 Month $2.50 By mall outside Illinois, Iowa and Missouri: 1 Year $2600 3 Months $7.50 6 Months $14.50 1 Month $3.1* one company lawyer told is, "is going up three or four cents a mile." FOR THE FLOYD and Beasley Transfer Company of Alabama, gateway regulations run up the annual mileage an extra 36 per cent. President Nixon's economic advisers have accused the IOC priv&tely of wasting 200 million gallons a year because of its foolish regulations. University of Chicago professor Yale Brazen, an advocate of deregulation, has estimated the annual waste as high as 400 million gallons. . Defending themselves, ICC officials claim their regulations prevent "cutthroat competition" and "financial instability" in the trucking industry. The present tangle of regulations, they say, is intended to protect the public interest. Whatever the explanation, the present ICC practices will continue to feed the fires of infla- |ion and to heighten the energy crisis. , Footnote: Spokesmen for the major shippers tell us the ICC is robbing the consumers in mere subtle ways, too. They claim the ICC hias pegged trucking fees at 15 to 25 per cent above their market level through "review" of rates and limitation of competition. NAVY RACISM: Plagued by racial unrest aboard its ships, the Navy has quietly ordered its top brass to fire racists if they refuse to change their ways. In a private memorandum to fleet commanders and other field chiefs, Navy personnel director David Bagley declared: "We are at a period of time during which we can no longer afford lip service or half-hearted support. Racism in ow ranks cannot exist." Cofal reef buffs will recall* that this oversii&ed starfish experienced a population explo- UMi in th6 late NXJOs i"' gari eating away at coral feefs, especially m Aus* tralia and Guam. Bounties were put on the creature throughout the Pacific and untold thousands were destroyed* Now, reports Smithsonian magazine, evidence is accumulating that the starfish may not be such a villain after all. According to one scientist, the starfish population may hot really have exploded; it may simply be that in the 1960s more people began snooping around reefs and thus more peopl gan noticing the thorns because it was designated as a threat. IT'S POSSIBLE, he says, that the starfish is simply one of several natural ways that coral- reef growth has always been limited. In any case, except in a few places where the starfish is probably harming a reef, the recommendation is to halt the eradication program, at least until we know more about what we think we are doing. (Newspaper Enterprise Assn.) \ Navy racists, wrote Bagley, must be weeded out even if they are "superior performers in technical or other professional aspects of their work." The traditional transfer of a white racist to tan all-white unit must also end, wrote Bagley. If counseling and discipline fail, he wrote, there must be "processing for discharge ... regardless of race." CARDINAL KROL: One of Ite world's most patient and persistent peacemakers is John Cardinal Krol of Philadelphia, the ranking U. S. Catholic. His quiet journey to Warsaw last October rivaled Henry Kissinger's celebrated visit to Moscow and 'Peking. The Polish government even placed the airliner "Copernicus" at his disposal for the journey to Rome, the equivalent of the White; House sending a VIP on his. way in Air Force One. Last month, Cardinal Krol was back in Europe pursuing his person- to-person peacemaking in strife- torn Ireland. One purpose of the visit was to engage Protestant leaders in ecumenical discussions. SCIENTIFIC JUNKETS: While research funds for the National Institute of Mental Health have been slashed, the institute's top scientists are junketing all over the world. An internal, eight-page summary of the junketing shows the taxpayers have footed the bill for trips to London, Canada, Germany, Mexico City, Paris, Monte Carlo, Stockholm, Italy, Belgium, Switzerland, Iran, Egypt, Guatemala and Nicaragua. The institute's thin purse was opened so the junketeers could; present papers or attend talks on everything from lesions on monkeys to green plant studies. Crossword Puzzle MEMBER AUDIT BUREAU OF CIRCULATION ACROSS 1 Old French coins 5 d'or 10 Pakistani coin 12 Ejection 14 Heroic deeds, 15 Lauded 17 Far off (comb, form) 19 Asterisk 20 Grocery item 23 Apoplexy (plant pathol.) 27 Knglish city 28 Regiment (ab.) 29 Bullfighter 31100 lakhs 33 One of the Furies 35 Spotted feline 37 Groups of two 39 Himalayan peak 41 One (comb, form) . 42 Ou*e tributary 44 Spaniab river 45 Employer 46 Preposition 48 Cattle genus 50 Garden plant 54 Dutch gold coin 58 Acted wildly 59 Shrub genus 60 Lower corners of sails 61 Bard DOWN 1 Unit of work 2 Actor's hint 3 Times of prosperity 4 Bout (coll.) i Cut off twigs 6 Pronoun 7 Land of the free (ab.) 8 Disease (suffix) 9 Ancient Roman coin (var.) 11 Mariner's direction 13 Former Por- 26 tuguese coin 29 16 Arid 30 18 Meadow 20 Cetacean 32 21 Dodecanese island 34 22 Self-centered 26 24 Ancient 38 Greek coin 40 25 Coojidge's 42 nickname 43 Answer te Preview Punk sua g |U • Qg^kiu • nun Proficient Affray South American tuber Priestly title (ab.) French river Sphere Baronet's title Cry loudly 504 (Roman) Unique act (coli) 45 Seize illegally 47 Greek coin 49 Poetic genrv 51 Summer (Fr) 52 Recent 53 Public notices (coll.) 55 Workers' group (ab.) 56 High card $7 Make lace (NEWAPU fNTCRFIiSi Am)

Get full access with a Free Trial

Start Free Trial

What members have found on this page