The Capital Journal from Salem, Oregon • Page 1

Douglas McKay apital jt, Joot ia Truman Calls tor $6 Billion New Taxes a Year to Finance Budget lakes uain as 25th Governor for $41.9 Billion Expenditures 61st Year, No. 8 Salem, Oregon, Monday, January 10, 1949 rVice Five Cents mttwr ftfc Sftltm. Ortfai Deficit Removal by Excise Tax Tops List Of Recommendations Past Wars and Future Peace Insurance to Cost $32 Billion New Legislation to Cost Over $6 Billion All Costs Going Up to Record Heights 1 1 Till oiUv-i U' 1 TX 'Mm B2R5 Harmony Rules As Legislature Gets Started Continued Cold Predicted for All of Oregon Budget Breakdown at a Glance i By th AMOclatfd Prrul Year ending June 30 Income (under oresent tax law) Outgo Deficit Year-end debt 1949 40.180.000.000 6nn.ooo.ooo .251.569 000.000 Washington, Jan. 10 UP' President Truman sent our biggest peacetime budget to congress today with a request for new taxes on corporations and individuals totalling S5.fl60.000.nno a year. lie wants more tax money largely to reduce the national debt, expand social welfare and conduct the cold war.

The requrst was made in his annual budget message for the fisral lyear 1950, which begin July 1 big spending for fiscal 1950 and warned that costs would go avail higher for some time thereafter. In round figures, Mr. Truman estimated fiscal 1950 spending at $41,900,000,000 and revenue at $41,000,000,000. He predicted a treasury deficit of just under 1. 000.

000, 000 unless taxes are raised. Congress will reject some of Mr. Truman's spending proposals land the President will later propose some new ones which are not i covered in today's budget. So the budget is open for changa at both ends. i Willi ir if i' in Leaving Private Life Senator Douglas McKay Monday morning leaves the desk in his office at the Douglas McKay Chevrolet company preparatory to leaving private life when he was inaugurated governor of Oregon this afternoon.

Cold Wave Grips Nation With Numbing Cold Bv the AMOclKtrd PrfMI A benumbing cold wave heaped more misery today upon the western plains and Rocky mountain regions which still were count ine their losses from last week's paralyzing blizzard. California were fighting again By PALL W. HARVEY, Jr. Preta dial! Correspondent! The 45th Oregon legislature opened today on a note of harmony and brotherly love, completing Its organisation without an argument. The lawmakers opened their session to formally elect offi- vers, after having done so informally last night according to script.

This afternoon they saw the inauguration of Governor Oogulas McKay and heard the messages of McKay and outgoing Governor John H. Hall. Tomorrow they will settle down to two or three months of hard work. Sen. William E.

Walsh. 45. Coos Bay, was elected president of the senate, and Rep. Frank J. Van Dyke.

41, Medford, was chosen speaker. Both are lawyers. Their elections were unani- mouse, as their opponents had conceded weeks ago. Staff All Top Hands A veteran staff of employes to run the business of both houses will be on hand. The only important change was election as reading clerk of Rollie Truitt, popular Portland baseball broad caster.

(Concluded on Pag-e 5, Column ft) Walker, Belton Head Finance Sens. Howard C. Belton, Can-by, and Dean H. Walker, Inde pendence, were named today to head the important financial committees of the state senate. Senate President William E.

Walsh appointed Belton, Who was barely defeated for state treasurer last November, to head the ways and means commit tee, which makes legislative ap propriations. It will be Walker's job to run the taxation committee, and thus be responsible for financ ing the state government. Chairmen of other senate committees which are expected to play a big part in this ses sion are: Agriculture, Carl Engdahl, Pendleton; education, Thomas Parkinson, Roseburg; forestry, Austin Dunn, Baker; game. Jack Lynch, Portland; judiciary. Irving Rand, Portland; labor and industries, William McAl lister, Medford; resolutions, Thomas R.

Mahoney. Portland; roads and highways, Paul Patterson, Hillsboro; rules, Eugene E. Marsh, McMlnnville. Individual committee assignments include: Allan Carson, Salem revision of laws, chairman; military affairs, vice chair-man; commerce and navigation, fishing industries, medicine. Frederick Lamport, Salem railroads and utilities, chair man; labor and industries, vice chairman; banking, medicine, revision of laws.

Dean H. Walker, Indepen dence Taxation, chairman; ways and means, vice chairman; education, elections, resolutions. rules. Truman Congratulations Forest Grove, Ore Jan. 10 (U.R) President Truman today sent Pacific university congrat ulations on the school's 100th birthday.

Special centennial charter day exercises were held on the campus here yesterday with the White House message keynoting the program. By JAMES D. OLSON Use of future of corporate excise taxea to wipe out the $38 million deficit in the 1949-50 budget wan advocated before both houses of the leg Mature Monday by Governor Douglas McKay. This and other recommends lions were read by Oregon's 25th governor after he had taken his oath of office administered by Chief Justice Hal) S. Lusk The house chamber, scene of the inaugural ceremonies was packed-jammed with members of the state supreme court and high state officers sitting on the rostrum, invited guests seated on the first floor and the general public in the galleries, The ceremony opened with John H.

Hall, outgoing governor, reading his message, in which he made several recommendations, a number identical with those offered by the new governor. McKay pointed out that the legislature might find it necessary to transfer a portion of the future collections of the personal income taxes for 'general purposes. Vote by People Requested However, McKay declared that a substantial sum of money is needed to provide needed new buildings at the state schools and institutions and urged the legislature to consider a building program that could be referred to the people, with the money taken from surplus income tax funds. He also recommended exemption from income tax of unusual medical expense and also life insurance premiums up to $250 annually. Repeal of the.

state withholding tax was urged by McKay, as was placement of all liquor sale funds into the general fund, and appropriations for old age assistance in the, same manner as other general fund appropriations are made, without limitation as to receipts from any particular source. (Concluded oft Pafe 5, Column ft) Summary of Speech Here, briefly, are Gov. Douglas McKay's major recommendations to the Oregon legislature: 1. Amend the corporation excise tax law so future revenues can be used to balance the budget. 2.

Repeal the 1947 withholding tax act. 3. Exempt medical expenses and life insurance premiums up to $250 a year from income taxes. 4. Refer to the voters a building program to be financed with surplus income taxes now on hand.

5. Repeal the law for discounting personal income taxes when a surplus exists. 6. Increase gasoline taxes, or motor vehicle registration fees, or both, to finance a 15-year highway program. 7.

Revamp the motor transportation act, with an eye to inter-state reciprocal relations 8. Place all liquor revenues in the general fund and pay old age pensions from that source. 9. Remove milk control forcement from the agriculture department. 10.

Increase industrial accident benefits. 'Butter and Egg Prices Drop in City Butter and egg prices were both lower here Monday morning, following similar cuts In Portland markets. The new butter prices listed grade A at 72 cents wholesale and 77 cents, retail: while but-terfat prices now list premium at 70 cents: No. I at 68-69 cents: ay the Ajaoelalfd Prtjl Oregon's prolonged cold snap froie to a new climax today, bringing a 34 below sero temperature at Austin, and the coldest weather of recent years to Portland and to the coast. All Lincoln county schools closed today because of ice-glazed roads.

Snow stretched to the beaches, and Newport recorded a rare minimum of 18 degrees this morning, lowest since 1943. Medford, in southern Oregon, was six above zero, the coldest recorded there in 12 years. Portland's mercury dropped to 16 degrees for the second straight morning the lowest temperature in six years. The weatherman warned that an east wind probably will lower the reading still further tonight. Six Fires In Portland Six houses and stores caught fire in Portland yesterday as occupants attempted to thaw frozen water pipes with torches.

All Oregon's highways were icy. The coastal community of Roads End was marooned by a solid sheet of ice on the road. The residents had no chains to make possible the drive and dared not drive out without them. In central Oregon, wildlife, driven from their usual haunts. moved into farms.

Near Canyon City quail approached hous es for food tossed out to them by housewives. Temperatures of 30 below coldest In the memory of many residents were recorded at Seneca and Bates. The Prairie City school's water pipes frozen, the school closed down. Grant union high closed when the furnace stopped working. Many Traffic Mishaps i rattic misnaps, tumbles on icy pavement, skiing and skat ing accidents piled up through out the state.

In the Eugene area, two mills curtailed operations after logs troze in the mill ponds. Minimum temperatures this morning included: Baker 5 be low; Burns, -5; Klamath Falls. -1; Lakeview, -4; Ontario. -13; Redmond, -3; Brookings. 26: Eu gene, 14; La Grande, Medford, Newport.

18; North Bend, 19: Pendleton. Portland, 16: Roseburg, 11; Salem, 17; The Dalles, 5. Medford's 6 above zero, was the coldest recorded there in 12 years. Body in River Is Identified as Yet Cottage Grove. Jan.

10 (Pi Deputy Lane County Coroner Robert Mills today reported a body found In the Willamette river near here last week has been identified as Albert Thorn-bury, 55. He had been a patient in the veterans hospital in Roseburg for the past eight years. Mills said the identification was made from dental records at the hospital. The deputy coroner said the hospital had received a letter on February 12, 1948, In which the war veteran said he intended to commit suicide. A sister, Edna B.

Donahue of Eugene, survives him. Three Dead in Plane Wreck Mineral. Jan. 10 (US) A snowshoe-equipped ground party reached the wreckage of an air force C-47 in heavily for ested country five miles west of here shortly before noon today and reported that all three crewmen were dead. crisis stemming from Israel's A Tel Aviv dispatch said the Israeli representative refused to accept the British protest because it was addressed to "Jew ish authorities in Tel Aviv' and not to the provisional government of Israel.

It was the second such Israeli refusal in two days. The first was by the Israeli delegation to the UN security council in New York for the same reason. Brit Sunday Coldest In Six Years New icy blasts blew in over Ihe Salem area over the week end, tumbling thermometers to the lowest marks in nearly six years. Sundays minimum slid down to 13 degrees, for the lowest mark since January 24, 1943 and cheer up. the minimum that date was only 5 above.

The maximum temperature (or Sunday was freezing point, 32 degrees. The minimum MnnJay morning was slightly higher. 17 degrees, still too low for western Oregon comfort. Mean temperature Sunday was only 22 degrres, 17 below normal for the period. No let-up in the intense cold is in sight for the next few days, at least.

The forecase for to night and Tuesday is for clear and cold with the mercurj due to fall to 14 tonight. The snowfall of Friday night is still on the ground, frozen solid, on the elevations around Salem, although it melted away in the downtown streets. Comic Books Led to Murder Philadelphia. Jan. 10 (r.

A slim, bespectacled 16-ycar-old youth whose room was found itlereri with comic books about crime was held on a homicide charpe today in the scissors slaying of a 12-year-old neighbor The battered and slashed body of Kllis Simons was found be hind a garage in the fashionable Wynnefield section vesterdav. clad only in shorts and bound hand and foot. Police said he apparently put up a "terrific battle" before he died. A hearing was set for Sey mour Levin at municipal court today. George F.

Richardson, assistant superintendent of police, said that Levin made an oral statement admitting the killing. Levin, a student at a select private school, was quoted by Richardson as saying that he now would miss his chance of becoming a doctor. "I guess I'm done for," he was quoted. "Now I guess I'll go to the electric chair." Investigators searched through Levin's room and unearthed a host of comic books dealing with crime and a number of works of fiction on the same subject. 1950 $40 9R.vooo.nnn 41.858.

000.000 873.000,000 251.925.000.000 this year. The message outlined National Park Money Doubled Washington, Jan. 10 (Pi Pres- ident Truman asked congress to day lo double last year's appro priation for the national park service. The national budget for the 12 months beginning July 1 recommends $29,485,600 fot the park service, an increase of over anticipated expen ditures during the current fiscal year. Most of the increase 650) would be used for the construction of roads and trails, parkways and physical improvement in the 26 national parks and 154 other areas administer ed by the park service.

The presidential message said other recommended Increases would permit "some expansion in general administration and in providing services to the stead-ly increasing number of visitors." Visitors to national park and monument areas last year totaled more than 29,000,000 persona the largest number in history. The park service maintains miles of roads, 6 868 milri of trails and 3800 buildings. Increased funds are sought for administration, protection, maintenance and improvement nf all of the 26 national parks. The breakdown Includes (anticipated expenditures for the current fiscal year in brackets): Craler Lake, $143,426 Mount McKinley, Alaska, $69,789 Mount Rainier. $212,751 Olympic, $145,290 Your Share to Be $282 for Year Washington, Jan.

10 Wi Your -hare in the cost of Eovernment as proposed by President Truman, averages out to $282 82 for the 12 months h. KiiiniiiR next July 1, compared with $271.04 for the preceding Ut months. Based on an estimated popula tion of 148.000.000. that is tha cost for every living Amercian man, woman and child of the government's operations at home and ahrnad, as reflected in the presidents budget messas today. The comparative cost in tha year ended June 30.

1941 the last full fiscal year before Pearl Harbor, was $101 14. The population then was onlv 132.350,-000. Commie Leaders Must Stand Trial Washington, Jan. 10 'A' The court todny refused to interfere with the indictment and scheduled New York trial of 12 leaders of the American communis party. The 12 akcd the supreme court to- Cancel indictments again.sl them, order a stay of their trij scheduled to begin in Federal court January 17.

and tli row out a list of propcctive jurors from which their tnal jury niav be drawn. The supreme court isued twa brief orders announcing ils refusal to interfere in the caws at this stage. It gave no reason The 12 all members of the national board of the communist party in the United Stales were Indicted charges of con spiraey to advocate the overthrow of the United States bov-eminent by force and violence. HfKhwav Bid Called The state highway commission todav called for bids on nine projects co.vting an 4ti mated $3,000,000. Rids will hr opened January 24 and 29 in Portland i This eye-pupping budget mcs-Isagc shows that past wars and future peace insurance are esti- i mated to cost the taxpayers near ly $32,000,000,000 in fiscal 1950.

Tat is approximately three of every four dollars Mr. Truman wants to spend. The only item there not directly related to past or future peace is the rela tively small part of the national debt interest due to deficits rolled up during Franklin D. Roosevelt's peacetime administrations. Keyed to Campaign's Promises Mr.

Truman reported to con gress that the treasury expected to get more money from the lax- payers in fiscal 1950 than in previous years despite republican tax cuts which congress passed over his veto. His list of new legislation keyed largely lo campaign promises, however, is a long one costing Mr. Truman also wants to help the treasury by reducing the $400,000,000 annual postal deficit by $150,000,000. He would raise parcel post, second and third class mail rates lo make those services self-supporting. The While House guess is that congress will make any new taxes start July 1 when the new fiscal year begins.

If so, the levies would not be fully ef fective in terms of new revenue until fiscal 1951. 14 Fields of Spending Mr. Truman broke his budget into 14 major fields of spending. Of these, four show a downward trend: international affairs and finance; veterans services and benefits: agriculture and agriculture resources; and transportation and communication. These costs are Roing up: na tional defense; social welfare, health and security; housing and community facilities; education and general research, national resources: finance, commerce and industry; labor; general government; debt interest; reserve for contingencies.

Third Suspect in Murder Case Nabbed Portland, Jan. 10 A third man gave himself up to police today In connection with the uptown street slaying of a janitor here last week. He was booked as Norman Carroll Andrus, 23, Portland. No charge was filed at once. Police said Andrus telephoned from his home after learning of the arrest of two others in the case Previously arrested were Le-land Uelbert Marshall, 20.

and Robert Edgar Carver. 24. both Portland. Slain in a robbery attempt a week ago was Ancel Abbott, 03 as he walked to work on an up town street. reclamation program during the malum projects in the next fiscal year, under the president's outline, would cost The remainder of the overall figure would go for administration, operation and maintenance of projects, and other expenses Yet, even as the president presented his record-miking budget, he warned that present high costs of construction and competitive demands of the country's economy "make it necessary undertake new river basin projects only where urgency is The estimates which he gave congress large as they were were still more than under the amount which the reclamation bureau was report led to have asked from the bud- get director.

Citrus fruit growers in southern to save the remainder of their $800 Currency Stolen at Combo Burglars pried an $800 prize in currency from a steel cabinet at Club Combo, a Hollywood district night spot at 2057 Portland road, early Sunday morning after smashing through a window and door. By Monday, Salem detectives were withbut an important clue to the robbery which was apparently executed by one or more thieves having a thorough knowledge of the clubs layout. Suspicion was aroused, how ever, that the burglary was staged by characters who had previously broken into the night club The burglary was discovered by Patrolman Harlay Cordray about 4:30 a.m. Sunday morning. A window to the mens wash room had been pried out with a pick or bar and was found smashed on the floor of the room.

A saw horse was propped against the building to enable the burglars to gain access to the building through the win dow which is more than five feet above the ground near the rear of the structure. The door to the second floor office of the establishment was pried with such force that the door casing was split. Inside, the steel cabinet was pried open enough to permit removal of an estimated $800 in cash. The drawers of the office were also rifled by the burglars Glen Woodry, 850 Norway street, listed by police as owner of the Club Combo, assisted officers in investigating th" burglary after he was summoned by detectives. Pat Hutchins of Albany was listed as manager of the club.

Want to Keep Power Pool Operating! Spokane. Jan. 10 Wj Want to help keep the nrrrthwest power pool operating tonight? Marshall Blair, supervisor nf system operations fur the Washington Water Power company, tells what you can do about the power shortage: 1. Turn off from 4 30 to 6:30 p.m. every electric heater in the house.

Each one uses as much power as 100 light bulbs. 2. Delay your dinner hour It necessary to keep electric stoves idle durintr the rw.nlr hours. es crops from another freeze. Snow fell in Los Angeles yesterday for the first time since 1932, and in Long Beach for the second time in 50 years.

It melted rapidly. Temperatures as low as 19 degrees were forecast for tonight or early tomorrow in the fruit area which suffered a $25,000 000 damage last week to the crop. Fresno had a low of 28 degrees early today and LosAngelcs 24 The frigid blast in the great plans and Rocky Mountains was Montana's coldest in 10 It brought renewed fear for the survival of livestock ready weakened from the lack of feed during the blizzard which brought death to at least 22 persons and tied up rail and highway travel for three days Blizzard conditions again were reported in some Wyoming areas and in northeastern New Mexico, but snowfall throughout the area generally was moderate with railroads and bus lines op erating on or near the normal schedules. At Livingston, the mer cury skidded to 26 below zero early today. International Falls.

had a -18, Bismarck N.D., a -11, and Casper, Wvo. 14. Readings generally below zero were in prospect for the en tire region as far south as north ern Kansas. The Red Cross set up a bliz zard relief service yesterday at Rapid City, S.D., and sent out planes In search of victims of last weeks storm. Snow there had drifted as much as 10 to 20 feet deep.

Eruption at Mauna Loa Ends Hawaii National Park, Jan. 10 iPi Mauna Loa, the giant vol cano which rumbled spectacul arly to life Thursday, appears to be going back to sleep A snowstorm left a gleaming white blanket on the upper slop over the week-end, contrast ing sharply with the main lava stream which has cooled from fiery red to fuming black. An eye-witness report by six men who rlimbed lo the riin of Mauna Loa'a 13.680-foot craler 24 hours after eruption provided a graphic description of a volcano in action. The party was headed by Frank Oberhansley. superintendent of Hawaii national park.

He said: "The lava was pouring from a crack about a half-mile long feet high put on a spectacular show. A river of lava flowed onto the floor of the craler." One small plane, with three men aboard, has been missing 'since Friday. (Coast Guard headquarters in Honolulu last night reported that a search plane crew member insisted he saw the small red craft through a hole in the clouds. He said It was intact in a ravine, on about the 9 (100 foot level of the vol can's slope. There were no re- Iporth ot any signs of life.) Britain Massing Strength Behind Her Arab Allies London.

Jan. 10 iPi Key British cabinet members and defense chiefs heard Foreign Secretary Ernest Bevin give a de- Nearly $380 Million Asked For Reclamation Projects Washington, Jan. 10 fP Prfsidrnt Truman baekrd up his and No. 2 at 61-68 rents, all buying quotations. tailed report today on the mid-East pledges fur development of western resources today wilh reeom action in shooting down five RAF planes.

The session was called by Prime Minister Attlee, presumably 3. Turn off all the lights Dl electrical appliances vou can. Ipr- More Blair ih. whnie onntilivid fountains from 35 to 50 to consmer Britain next move- and perhaps determine how far she will go in strengthening land, sea and air bases in that part of the world. Britain appeared to be massing strength behind her Arab allies as she concentrated warships and troops in the tense Mediterranean area.

The move came on the heels of Britains "strong protest' to Israel against the shooting down of five RAF planes Friday Britains protest was contained in a brief memorandum handed to a representative of the Israeli foreign office at Haifa by British Consul General Cyril Marriott. The protest stated that Britain reserves all her rights "both mrnriAtinns for 53.i yenr beginning July 1. including $6I. 500.000 for the Columbia basin. This would be $24,000,000 increase for the Columbia basin projret, compared with funds provided for the current fiscnl year.

Other northwest project rec ommendations would bring the region's tot fil to above They included: De.ichutes, 1, 368.000. Klamath project. Ore $1,000,000. and Yak'ma. Ro.se division, It was the biggest reclama tion budget ever submitted to congress.

Expenditures during the year ending June 30 for that work are expected lo $22 BR2.000 total Actual construction of recla- 1 listed lower prices Monday, some having cut previously. The egges now are listed at i 85 cents on AA grade. 56 cents on a grade, 31-5:) cents on mediums, all buying prices: and at 62 cents for AA grade. 60 cents 'or A grade. 55-60 cents, mediums, all wholesale prices.

THE WEATHER (Released by United States Weather Bureau! FyjrecaM for Sam and Vicinity: Clear and continued cold tonlahl and Tuesday. Lowest temperature expected tonight. 14 degrees: highest Tuesday. 34. Maximum yeMerdav 32.

Minimum todav 17. Mean tempera-lure yealrrriav which was 17 below normal. TVital 34-hour precipitation to 11:90 a.m. today 0 Total precipitation 'or the monih 30 ot an Inch which la 1 4R inches below normal. Willamette river height at Salem MonrtaT.

1.6 feet. could collapse unless enough people help during the current power crisis. Your electrically operated furnace could go out with it. ibrewer Ariolplni llii-rrt laid them out in 1903. gor on the auction block next Wednesday.

ain does not recognize the slate To Sell Bnvh (iardrn of Israel. Jan. in i4 Government sources said it lsThe Busch Gardens, a world probable Britain's next step will i famed horticultural park visited be strong demand that the UNlby countless thousand of tour-security council insist thai Jew-jists sincr millionaire St Louis with regard to claims for com-jish pensation and to all possible sub-1 troops keep within Israel's boundaries and that Israe. pay for the losstof planes and pilots. (sequent action." I I.