The Daily Alaska empire Newspaper, January 10, 1949, Page 1

THE DAILY ALASKA EMPIR VOL. LXXII, NO. 11,089 “ALL THE NEWS ALL THE TIME” JUNEAU, ALASKA, MONDAY, JANUARY 10, 1949 MEMBER ASSOCIATED PRESS PRICE TEN CENTS NATIONAL BUDGET IS GIVEN CONGRESS Truman Proposes Bigl Development in Alaska BIG BUDGET FOR ALASKA REQUESTED Over One H;J_ridred Million Dollars Asked from Congress By HARRISON B. HUMPHRIES i WASHINGTON, January 10.—®— ‘The National budget called today for expenditure of more than $100,- 000,000 in Alaska during the 12 months Lteginning July 1. President Truman recommended to Congress that millions be spent for housing, community facilities, and transportation “in this impor- tant area.” The budget includes increased funds for the study and development | of Alaskan timber, water, land, mineral, fish and wildlife resourc- es. “As part of the program to de- velop the resources of Alaska,” the President said in his budget mes- sage, “I have recommended special assistance tor both private and pub- lic housing. Such housing is badly needed, but is hampered by exces- sive construction costs. “This budget provides for a $10,- 000,000 revolving fund to finance loans and construction by the Alas- ka Housing Authority. “T also recommend a $2,000,000 ap- propriation to the Federal Works Agency to provide for certain ur- gently needsd public works in Alas- ‘The largest amounts proposed in the Alaska budget are for improv- ing the Alaska Railroad. The President asked for $25,000,000 appropriation and authority to con- tract for an adaitional $22,000,000 expenditure on the Alaska Rail- road. Last year Congress granted $17,000,000 in cash and $12,000,000 in contract authority. Congress also was asked to re- appropriate $15,800,000 from the op- erating revenues of the railroad. For construction and maintenance of roads, bridges, ferries and trails, the budget calls for $26,692,000 and an additional $7,000,000 in contract authority. Last year's cash appro- priation was $10,442,400. The Office of Indian Affairs re- quests $5,925,000, compared with $4,- 118,962 appropriated last year, for the Alaska Native Service. A proposed $2,682,500 building con- struction program would be for work rebuilding the White Mountain boarding school, with $2,000,000 for (Continued on Page Three) —————— The Washington Merry - Go- Round Bv DREW PEARSON 1Copyright, 1948, by The Bell Syndicate, Ine.) ASHINGTON— Senator Ar- thur Vandenberg, gruff, able GOP spokesman of the bipartisan for- eign policy, phone the other day to find out for himself whether President Tru- man was considering him for Sec- retary of State. The big Michigan Senatoj called Truman's right-hand man in the Senate, Les Biffle. A story had leaked out the White House back door, explained Van- denberg to Biffle, that he might' be asked to take over Secretary of State Marshall's job. Just to put the rumors straight, Vandenberg wanted the White House to know where he stood. Biggest obstacle would be leav- picked up the tele-| | TAX ON FISH PROPOSED IN By JAMES HUTCHESON A bill to tax halibut, herring, cod, clams, crab and bottom fish for the first time in Alaska head- ed toward a special session of the Territorial Legislature today. timated four to five times the pres- ent tax on canned salmon. Rep. of the Douglas Packing Company, drafted the bill and said he intend- | ed to introduce it today. He said he was offering it as a potential revenue source which would fluctuate with the market as preferential to property taxes. Except for canning fish (salmon) the measure proposes a tax of four per cent on raw fish with the value based on price paid the fisherman. For canning fish, the taxing value would be 50 per cent of the whole- sale value in Seattle for that spec- ific kind of fish. Estimated on present prices, this would make the tax on sockeye with the present tax of 10 cents. The estimated revenue is about three million a year compared with about one million currently de- rived from the canned salmon in- dustry. Jensen said he thought there was little danger of halibut being di- jverted to Prince Rupert to avoid the tax because only southernmost catches go there, amounting to akout 10 per cent of the total catch the past season and fishermen 20 to Prince Rupert and miss valu- able fishing time just to avoid a than $50 for a big boatload. Jensen said the bill was based on a study of prospective Washington state legislation. Slops Erupfing; Small Plane Found, Slopes HONCLULU, T H Jan, 10.—A— The Hawailan volcano Mauna Loa The yolcano came to life last Thurs- day and erupted a stream of lava for the first time in several years. Now the eruption is subsiding. A snowstorm over the weekend has left a gleaming white blanket on the upper slopes of the volcano. A small plane with three men aboard has been missing in the vol- cano area since last Friday. Last night Coast Guard headquarters re- ported that a search plane had sighted the small red aircraft about nine thousand feet up the volcano’s party will set out to try to find the plane. COMMUNISTS WIPE OUT CHINA FORCES SOUTH OF SUCHOW Sdn, Francisco. SAN FRANCISCO," Jan. 10.—®—! The Chinese Communist radio said today that all Government troops: completely wiped out by 10 o'clock this morning.” from Nationalist ing the Senate, he pointed out. He couldn’t desert the Republican par- ty and let Michigan’s new Demo- cratic Governor appoint a Demo- cratic Senator in his place, A possible compromise, however, would be Mayor George Weish of Grand Rapids who would be ac- ceptable both to Democrats and Republicans, Vandenberg added. But the Senator from Michigan said he still couldn’t sit at the Last reports Gen. Tu Li-ming at between 150,000 and 250,000 men. Red estimates a few hours ago cut the size of the force down to 130,000 troops. The 3 pm. on January 6. At one time 1,0000000 com:atants were reported engaged in the Su- head of the President’s official " (Continued on Pue Four) chow struggle. » The Communist broadcast was heard by The Associated Press in JENSEN BILL It also would increase by an es-! Marcus Jensen, Democrat, president | about 56 cents a case as Compared | couldn't afford to take the time to| tax whieh wouldn't amount to more | slopes. Today, a ground searchingl encircled south of Suchow “were sources estimated the troops under | Communist radio said the, big battle to end the long nnd; costly Suchow struggle began ati Elecrical Energy Is Key fo Alaska Industry Says Warne rTO INTERCEDE, WASHINGTON, Jnnunr) 10- Development of electrical energ; the key to Alaska's industry, As- sistant Secretary of the Inwuor William E. Warne said late Satur- | day. Within the past six months, he said, enough power. sites have beer founq in Alaska to multiply the Ter- ritory’s electrical output 1,500 times. ‘Warne, writing in the Bureau of Reclamation magazine, “The Re- clamation Era,” e n | iand irrigation project possibilities last July after Congress provided 1$150,000 for that purpose. | | Although engineers have surveyed {only the major rivers, Warne said, they already have found hydroelec- imc power sites which would pro- {duce more than 50,000,000,000 kilo- watt-hours annually. This represents about one-fifth Ithe electric power output of United i States utilities in 1947, he added. Alaska’s power output last year was only 34,500,000 kilowatt-hours. The Reclamation Bureau's Juneau office already has submitted to the Interior Department its report on the proposed Eklutna project near Anchorage, Warne said. He addad: “At the present time it appears that the next development in the railbelt area would be in Devil Canyon on the Susitna river, 125 miles north of Anchorage and only 10 miles from The Alaska Rail- iroad. but also several large industries projected for the railbelt. Initial in- stalled power plant capacity would 2e more than 100,000 kilowatts. | “All in all, I am told, there are 30 major potential hydroelectric power sites in Southeast Alaska alone which could have a continu- ous capacity of mores than 300,000 kilowatts. Investigations are now Leing conducted on major sites near Juneau, Sitka and Ketchikan.” Warne said the Federal Govern- ment’s inter-agency committee on Alaskan development, organized last year, “feels that if we can develop | hydro-electric power in Alaska, the edge can be knocked off the high cost of energy.” “Some Industries will be attract- |ed,” he said. his would also reduce the size the requirement for capital in putting small industries into the Territory, and thereby knock down high cost of living. “Without a new source of energy, a town like Anchorage will have to |stop growing. Without a lower-cost |source of energy, the same town |appeared to be going back to sleep. | will have no development of business of basic_industry to support it in the long run.” LEGISLATIVE RECEPTION T0 BE HELD JANUARY 29 All members of the 19th Session of the Territorial Legislature will be honored at a pullic reception given by the Governor and Mrs. {Ernest Gruening at the Governor's House on Saturday evening, Janu- ary 29 between the hours of 9 and 12. All residents of Gastineau Chan- nel are cordially invited to attend the reception to meet the Legisla- tors. STOCK QUOTATIONS i NEW YORK, Jan. 10.—®—Clos- |ing quotation of Alaska Juneau mine stock today is 3%, American |can 85%, Anaconda 34%, Curtiss- ‘erght 8%, International Harvest- ler 27%, Kennecott 56; -New York | Central 12%, Northern Pacific 16%, | Sales today were 770,000 shares. U. 8. Steel 71%, Pound $4:03%. Averages today are as follows: Industrials 180.57, rails 53.54, util- (ities 34.23. —,e*-— — TACOMA— Two Air Force pi- Iots in a helicopter have identi- fied the wreckage of a missing C-47 transport on a ridge 30 miles west of Mount Rainier. Ground parties will attempt to reach the wreck- age today. The big plane vanished !last Thursday night on a flight {from McChord Air Base from Hill il'leld. Utah. Three men were ) aboard, said the Bureau| started investigating Alaskan power | “The Devil Canyon project would ! serve not only the Anchorage area | HOUSE MOVES, 'Arbltrahon s Suggested in Legislative Trouble ~Comment Made By JAMES HUTCHESON The House of the Alaska Lef lature voted today to try to inter- |cede in the Senate deadlock over the presidency. Without a dissenting vote, it adopted a motion calling upon the | Senate to allow the House to arbi- | trate the dispute unless it can| reach its own agreement by 3 p.m. today. A few minutes later it vot- ed 21 to 1 for a critical resolution to be sent to the Senate “in a spirit of cooperation.” The first voice vote came on a motion by Rep. Stan McCutcheon, Democratic leader from Anchorage, who charged “the wheels of pro- ress are being tied vp by eight in the Senatc, CRI1.CILM “We stand criticized by the pub- lic like the few who are causing: the deadlock,” he added. McCutcheon said he had learned me Senator had said the special session is fllegal and “would sit there until the whole thing blows! 'np," McCutcheon said, “that’s dan<} erous.” There was a quick response from teputlican Senator William Munz of Nome, who said, “We can run the Senate without any help from the House.” ENGEBRETH'S CHALLENGE Sen. Gunnard Engebreth, Anchor- 2e Republican, and temporary President of thc Senate, challenged the House Democrats’ contention the eight Republican Senators are to olame for the deadlock. “The responsibility lies with 16 Senators, not with eight,” said the Senator who polled a minority vote for President himself through' the carly balloting. “Seventeen ballots have been tak- en and NOT once has a Senator ~rossed a party line. It appears that | varty does mean something to each and every member. I would put the hlame on the failure of the organic ict to provide for breaking tie votes | and the refusal of 16 Senators to compromise.” Engebreth said, however, “I'm still optimistic. A bad start often augurs a harmonious session, despite ap- pearances to the contrary.” ! The House entered the Senate [ ~ontroversy as the deadlock con- *nued for President with a change | of faces. The vote in the House against the resolution to intercede in the dead- lock was cast by Republican Frank Tohnson of Nome who said the House shouldn't try to tell the Sen- ate how to vote. ARBITRATION PLANS The resolution to Le presented to the Senate proposes that if the Senate is unable to settle the Pres- idency by 3 p.m. today it should agree to one of two mediation plans: Each Senate faction to select one member to meet with a House member, who would be elected at |large, with the three having au- thority to make a decision binding on the Senate, or, 2. meet in joint session with the House to select the Senate president. While the Senate is divided eight- eight, the Democrats have 19 of 24 seats in the House. Johnson was the only House mem- ber, Republican or Democratic, to speak against the House proposal. He advised against rushing “hasty action. We shouldn’t try to tell the Senate how to vote. The Senate’s own actions will advise the | public where it stands.” SUBJECT OF RIDICULE Rep. Warren Taylor, Fairbanks Democrat, said the whole legislature is becoming the subject of ridicule because “a few wilful men are stop- ning the wheels of both House and Senate.” The resolution was presented to the House bv Rep. Clarence Keat= ing, Anchorage Democrat and for- mer Seward mayor, and Rep. Doris " (Continued on Page Six) 17 BALLOTS FAILTO END SENATE TIE| Peratrovich an& Rivers Re-| jected by Repubicans for Senate Presidency At 2:30 o'clock this afternoon the Senate went into an execu- tive session, newsmen and oth: ers were asked to leave. which they did, and the Senate doors were locked. By BOB LeARMOND There was a shift in Democratic candidates for the office of Senate President, but at noon today it had failed to break the deadlock, now in the fifth day of the Special lEGISlAIORS IN DIFFERENCE ON TAXATION ISSUE | By JAMES HUTCHESON | Most legislators at the special |session express the opinion that new taxation appears a certainty but there is considerable difference of opinion over the type of taxation While the Governor's message was postponed from this morning ibecause the Senate remains unor- Iganized, the House Ways Means Committee is due to start intensive consideration of the first two bills' for income and general property taxes. Income and property tax bills and | ganization of the upper body | Session, which has prevented or-|are supported by Democratic organ- of jization on the argument they are the Legislature. Senator Frank Peratrovich of the ' First Division was the first new a roll call eight votes for Senator eight for Senator Jones. showed tor Howard Lyng of the Fourth Di- vision was nominated, with no change in results. First order of business this morn- ing after the invocation by the Rev. Robert Treat and the reading of | from the Third Division Grand Jury that the Legislature provid: funds for welfare and health and for a juvenile detention home in Alaska, was a motion by Senator | Rivers for the adoption o1 Roberts' Rules of Order. Motion Contested Senator Rivers' motion, which makes Roberts’ Rules the govem-! ing code for the body umtil a per- manent president is elected, receiv- cd some opposition from the Re- publican members. The vote on the motion was 9-7 with all Republicans except Sen. Engebreth voting against it. There was alsa vocal opposition from the Republicans on Sen. Riv- ers’ motion to reopen the nomina- tions for permanent president al- though the final vote on his mo- tion was 15-1. Senator Coilins made the point | that new nominations were merely to be added to the existing hallot | and it was so ruled by Senator Engebreth, President pro tem. ‘The nomination of Sen. Peratro- vich placed four cgndidates before the Senators, although Peratrovich and Jones captured all the votes and Engebreth and Rivers none of them cn the next four roll calls. Senator Engelreth called for discussion from the floor on the stalemate and suggested that the Senators flip a coin to decide the presidency. There was some other thinking along the same line, Sen- ators Nerland and Garnick pro- posed that lots be drawn for the office. Senator Lyng proposed an execu- tive session of the Senators, with the public and press excluded from the chambers, and thought that a2 compromise might be reached under those circumstances: As an alternative, he suggested a secret ballot. Nominations were reopened at 12 o'clock noon after another re- cess and caucus and the name of Senator Lyng joined the other four on the ballot. On the first roll call on the new list of candidates, Senator Frank' Barr failed to catch the signals and voted for ; Sen. Peratrovich. Into| sen, Lyng received seven and Sen. ' feg; Jones tallied eight, question unresolved. The final ballot of the Senate's forenoon session, the 17th ballot of the session on the question of elect- | ing a permanent president of the Senate, showed an 8-8 deadlock of | Lyng and Jones. Senator Lyng announced on the floor this morning that the Demo- crats will continue to offer “com- promise candidates,” which may mean that each of the five Demo- crats who have not yet been nomi- nated may have a chance for the chair. lenvmg the Rivers, | After four | iballots failed to change the vote’ from the prevailing 8-8 tie, Sena- | !the most equitable and directed against those best able to pay. [ Two middie-of-the-road Repub- | nomination by the Democrats this | licans, belonging to a group upon | morning after |whose support Democrats are count- ing to put through revenue legis- lation, said today passing of some tax legislation is a certainty. They are Gunnard Engebreth of Anchorage and John Butrovich, | i Jr., of Fairbanks. Business Licensing Tax Engebreth said he 'plans to offer a measure, however, for a business ‘the Journal and recommendations 'Censing tax instead of income or ! property taxes. It is based on a milar tax law now used by sev- Engebreth says it 'should raise six million® dollars tor the blennium, bringing the Terri- jtory's total expectations to twelve | 1 million, | He predicted the proposed seven- teen-million dollar budget may have to be cut considerably ¢ Cut In Budget cuts should be made in budget es- and property taxes in principle. Coliins, one veteran old-line Re- puklican, favors a sales tax as the fairest in spreading the tax burden to all and the cheapest to collect. “Don’t think the Territory could ;et more than 30 cents on the dol- lar from income or property taxes because of the high cost of col- lecting them,” said Collins. Tax Proposal Costly i Engebreth also criticized two tax proposals as costly. Collins criticized the calling of jthe special as “needless” and an ;nllempl by the administration to | ‘speed measures through inexper- ienced Democratic legislators.” “We recognize some new revenue it needed,” he said, “but the regular session could have handled the problem.” He also predicted many mines will .be forced to close if the property tax is enacted. ESTIMATED INCOME TAX WARNING GIVEN Since January 15 falls on Satur- day this year, Monday, January 17, becomes the deadline for amending 11948 Declarations of Estimated In- come and for paying the tax, In- ternal Revenue Collector Clark 8quire reminds Federal income tax- 1payers. Not all taxpayers are required to file by January 15. Those princi- paily involved are business and pro- fessional people and farmers. Pro- onal people and those-in busi- ness must pay the final installment jon declarations filed last March, and if they find they have underesti- mated by more than 20 per cent they must file amended declara- tions. Farmers were excused by law from lestimaung their 1948 income last March, so must now file declara- tions or final returns and pay any tax cue, Those taxpayers who are not re- quired to file until March are urged Ly the Collector to mail their re- turns early, especially if refunds are due. the | Butrovich and Sen. E. B. Collins | lof Fairbanks also said extensive | timates, Butrovich endorses income | 'New System for Contracting Labor Proposed by Alaska TFL | sITKA, A)uskn Jan. 10—p ‘Luilding trades section of the | Alaska Territorial Federation of | Labor voted today to insist tHat all | future union agreements in the construction industry in Alaska be negotiated within the Territory | The action is. directed against | the negotiation of contracts outside contracts. Newly elected President ! Davis aeclarved “In view of the fact that Alaska, America’s last frontier, soon will take its rightful place in the poil- tical and economic life in statehood, we regard the move essential development of Alaska. This will result in a better understanding be- as the agreements will be negotiated | by the persons directly involved.” | Glen Irving, business | tative for the Plumbers and Pipe~ fitters, Anchorage, was elected as executive Soove Abcut 125 delegates are on hand, among them Lee Flynn of Seattle, representing AFL President William Green, and Clayton W. Buildderback of Portland, representing the Steamfitters’ Umon COLD WAVE IS HITTING CALIFORNIA iMore Miser>y7f6r Western Plains, Rocky Mountains ~Citrus Crop in Danger (By The Associated Press) A benumbing cold wave heaped more misery today upon the west- | ein plains and Rocky Mountain re- gigns which still were counting their losses from last week’'s par- alyzing blizzard. Citrus fruit growers in South- ern California were fighting again to save the remainder of their crops from another freeze. Snow fell in Los Angeles yesterday for the first time since 1932, and in Long Beach for the second time n 50 years. It melted rapidly ‘Temperatures as low as 19 de- grees were forecast for tonight or ewsly tomorrow in the fruit area which suffered a $25,000,000 dam- age last week to the $100,000,000- a-year crop. Fresto had a low of 28 early today and Los ‘The frigid blast in the great plains and Rocky Mountains was Montana's coldest in 10 years, It drought renewed fear for the sur- vival of livestock already weaken- ed 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. At Livingston, Mont., the cury skidded to 26 below today. degrees Is Nof Married WASHINGTON, “Completely absurd,” Warren G. Magnuson (D-Wash.) of year-old actress-heiress, Reports linking the Senator romantically Millarde, known as 43-year-old with June Toni as “necessarily absent” ing of Congress. The weather, not romance, layed him, Magnuson told a reporter upon his return to town yesterday. Tlu | Alaska which have been prevalent | in cannery and major construction ! George | | peace-time the | United States with the coming of | to continued growth and | tween labor and management since | rePIOSEN” | President said he will propose be- | lay, | the nation faces an $873,000,000 1950 | deficit piled atop a $600,000,000 red | wants on corporation, Angeles 24, | reports that he had married a 25-| Seve:n“ arose last week when he was listed | at the open- | | de- PEACE-TIME BUDGET GOES T0 CONGRESS Half of Great Amount Is fo Wage Cold War on Rus- sia-More Money Wanted By CHARLES MOLONY WASHINGTON, January 10.—(P— President Truman today handed Congress a record $41,858,000,000 budget—half of it to wage a cold war with Russia. And he warned that the price of bulwarking freedom in the world is going higher still. The spending program Mr. Tru- man charted for the 12 months be- ginning next July 1 is $1,678,000,000 higher than this year's—also a peacetime record. Still to come is the cost of re- arming Western Europe—a step the fors the year is out, to boost the |total still further. NEW DEFICIT Even in the absence of that out- the chief executive declared, ink entry for 1949—unless taxes are raised. Socerly, Mr. Truman declared lmac future budgets will have to be b?uer yet to meet America's mount- 'ng responsibilities in the world and to pay the bill for a greatly ex- panded military establishments at home. JUMP TAXES Thus the President renewed with emphasis his plea that Congress {jump taxes $4,000,000000 a year— not counting higher levies for in- creased soclal security benefits and a new health insurance program he wants to start the New Deal ball rolling again. ‘These important disclosures were made on highest authority follow- ing issuance of the budget mes- sage; i 1. The President figures on July 1 being the effective date for the | $4,000,000,000-a-year tax hike he estates and “middle and upper” bracket incoms. He thinks it may yield only $2,. 000,000,000 in fiscal 1950, however, because of a time lag in collections. 2. The President expscts to fi- nance his proposed national health insurance program with a one-half of cne per cent total tax on pay- rolls, beginning next July 1. Em- ployees and employerq each would pay one-fourth of' one per cent. 3. An estimate that individual income tax collections in 1950 will vield $19,135,000,000 reckons that in- dividual incomes will remain at the irecent record-high annual rate of $215,000,000,000 and the Federa! in- come tax alone will drain off nearly one-tenth of that. o NEW ATTACK MADE ON “SANITY CODE" SAN PRANC!SCO Jan. 10.—(P— The outgoing president of the Am- erican Football Coaches Association lashed out at the National Collegiate Athletic Association’s . year-old sanity code” today. He said coaches ‘are fearful we.have another prohi- ition act on our hands.” Harvey Harmon. of Rutgers, in 4 statement at the end of the As- e - S M | #ociation convention here, said his en. Magnuson | | keep football amateur and we must profession had no..quarrel with the 2ims of the code, “We recognize it as an effort to be sympathetic with the ‘motive, he declared. “We are waiting to see” | how honest, fair and free of ‘hypo- crisy the administration of this code will be. “College football coaches despise hypocrisy.” The veteran Rutgers mentor as- serted that “one college president (not my president) recently said: “This sanity code will make' liars of us all'" ORI SRS AT GASTINEAU Registering at the Gastineau Hotel yesterday from Ketchikan were Douglas B. McMullin, Walter R. Pehlman and Vern Albright.-