Evening Star Newspaper, February 18, 1931, Page 2

A2 #% BLACKFEET LAUNCH | §68.707,000 SUIT Tribe Seeks to Recover From U. S. Under Treaties of Covered-Wagon Days. BY THOMAS R. HENRY. The Blackfeet are on the war path again. This time the battleground is the United States Court of Claims, where the tribe is suing the Government for $68,707,000 on claims arising from long forgotten Indian wars and covered- wagon caravans over plains black with bison. | It is one of the largest claims ever brought against the United States and it all goes back, according to Joseph W. Brown, president of the tribal councfl,‘ 1o the days of the Oregon trail and the back wash of the '49 gold rush to Cali- fornia, when the Blackfeet considered themselves an independent Nation. The covered wagon trails passed through the Blackfoot country about the headwaters of the Missouri. ~The dry, desolate foot hills east of the Rockies were of no interest to the Ppioneers whose hopes were fixed on the fertile Pacific Coast slopes aheid. Ali they wanted was safe passage for their wagons and herds of stock through a country which, Mr. Brown they | never considered “a white man’s land. Treaty Signed With Tribes. For this purpose a treaty was signed with the chiefs of the Biackfeet and other mountain tribes, just as if they had been independent nations. by which the tribal territories were delimited. At that time the Blackfeet were a power- ful nation, numbering about 10,000 souls, who lived almost entirely off the buffalo. Now a point evidently over- looked in drawing the boundary lines Was the fact that there were no buffalo west of the Rockies, while the country about Hell Gate pass, the easiest route for the wagon trails, abounded with them. This was claimed by the Black- feet. The Nez Perces and the Flnt- heads of the Washington territory ye- gan to send raiding parties across : mountains. These would clash #ith the Blackfoot hunting parties and bloody skirmishes would ensue. To meet this difficulty Gov. Isaac I. Stevens of the Washington Territory arranged in 1855 another treaty between the Blackfeet, the Nez Perces and the Flatheads, setting aside, just south of the Musselshell and Missouri Rivers, & common hunting ground. Gold Found in 1862. For the white men merely the right of passing through was reserved. They + claimed no rights of settlement. But the cattle of the pioneer carava.s would arrive at Fort Bridger so e-hausted, from the long journey that tley could no further. Three or four “nterpris- e Dloneers started a profitgble busi- ness by buying up these exhausted cat- tle very cheaply and then turning them loose on the range to fatten. Then they would sell these fat cattle to the next caravan at a high price in exchange for their exhausted stock. The Indians Jet tais invasion pass without protest. Then came the backwash into Idaho and Montana of the “forty-niners,” and in 1862 gold was found ir. the heart of the common hunting ground. Pros- pectors -and settlers poured in, villages sprang up and the bison were slaugh- tered. The Montana Territory was es- tablished. At this time a new treaty was negotiated with the Blackfcot Na- tion, but it never was ratified by the ate. ‘e;‘n 1864 the law was enacted that no, case originating from a treaty with a; forcign power or with an Indian tribe could be heard in the Court of Claims. | A special act of Congress was necessary to bring the present action. In 1873 the Indians were declared wards of the Government rather than independent peoples. i No More Treaties Permitted. No more treaties could be negotiated between the Government and the tribes. | The Blackfeet saw their rights in the common hunting ground disappear with | 1o means of redress. They had nego- | tiated a satisfactory agreement as a “nation.” The United States had de- layed ratifying it and then suddenly ruled that the Indians couldn't make a treaty anyway. | Gov. Stevens, in negotiating the first treaty, had calculated that each Indian of the three tribes was entitled to a minimum of 20 bison a year to main- tain him in comfort. So the Blackfeet have calculated the mean of the tribal | numbers between 1868 and the presert and demand the value of 20 bison a year | for each person. This alone accounts | for $16,000,000 of the claim. But, they claim, the Montana invasion overran the territory assigned in the unratified treaty of 1868 exclusively to the tribe. After the establishment of Montana as a State in 1889 the tribe, at that time greatly reduced in num- bers, sold the greater part of its land north of the Missouri River and retired to its present reservation in the rorth- Wwestern corner of the State. | Case Hinges on Status. ‘The value of the land that was ap- Ppropriated by the settlers before they could sell it is the basis of the rest of the Blackfoot claim. The tribe claims that it had signed the treaty of 1868 in good faith as an independent nation and 1t was five years later that the status of the tribe was declared to be that of | case hinges largely, says Attor- arter. on the actual status of the Indians before the present policy w into eflect. At first they were con ered as “independent.” to be dealt w under the practices of international law 85 any other independent nation. Then, in the case of the Cherokec Nation against the State of Georgia, the Su- preme Court ruled, not without dissent- ing opinions, thac the Cherokee coasti- tuted a “domestic dependent nation.” Hence it was with a “domestic depend- ent nation,” in the eyes of the United States, that the treaties with the Black- = negotiated. The meaning of fication, the tribe coatends, is doubtful. Carter points out that under it some of the tribes con- tinued to function as practically inde- pendent governments. The Cherokee Nation in Oklahoma, for example, had a progressive government, which, among other things, istalied the first, govern- ment telephone line in the world for the transaction of official busines Tribe Numbers 3,000. The Blackfeet want to know exactly what they were when they signed the treaty establishing their territorial lim- its and the common hunting ground. Were they victims of international foul play on the part of a powerful nation toward a weaker one? They long since have accepted their present status as wards of the Government, but they are unwilling to admit that this status was retroactive from the time it was pro- claimed by President Grant. ‘The tribe now numbers approximately 3,000 souls. They are represented in ‘Washington by three members of the | Merriam. i months, and he was near death on one WILLIAM RUSH MERRIAM. —Harris-Ewing Photo. WILLIAM MERRIAM DIES IN FLORIDA Former Governor of Minne- sota and Director of Census Lived Here 30 Years. William Rush Merriam, former Gov- ernor of Minnesota and director of the United States census from 1898 to 1903, died_today at Port Sewall, Fia, where he had gone for his health several months ago. He was in his eighty-sec- ond year. Mr. Merriam had lived in Washing- ton for more than 30 years, but because of failing health had been spending his Winters in Florida during the past sev- eral years. With him when he died this morning, at_9 o'clock. were his wife, Mrs. Leura E. Merriam, and a daugh- ter, Mrs. Mabel de Lano Wheelwright. He is survived also by another daugh- ter, Mrs. James F. Curtis, and two sons, Capt. John H. Merriam and William H The body will be brought here at once. The funeral will be held from his late residence, 1728 N street, Priday afternoon, at 3:30 o'clock. In- terment in Rock Creek Cemetery will be private, Mr. Merriam had a distinguished ca- reer in public and private life. He was born in July, 1849, at Wadham's Mills, N. Y., the son of John L. and Mahala de Lano Merriam. He was educated at Racine College, Racine, Wis., receiving his A. B. degree in 1871. Shortly after graduation he entered business as a clerk in the Merchants National Bank. St. Paul, Minn., of which institution he became the president in 1882. He for- merly was president also of the Shenan- doah Iron & Coal Co. and the Liberty Furnace Co., in Virginia, and of the Tabulating Machine Co. of this city. Public service called him in Minne- sota after he attained prominence in business, and he was elected a Republi- can member of the Minnesota House of Representatives. He was speaker of the Minnesota House in 1886. In 1889 he was clected Governor of Minnesota, serving until 1892. Appointed director of the census in 1898, he established his home in the Capital and had remained here ever since. | Tl health had beset him for many occasion last Summer, friends here re- called today. CABINET IS FORMED IN SPAIN BY AZNAR, ROYALIST ADMIRAL (Continued From First Page) now is his cnly, by an appeal to his patriotism. Gen. Berenguer also is not well and it was considered doubtful that he( would be able to participate actively in the new Government. | The cabinet is composed of extreme Right Monarchists, with representatives | of the Conservatives, the Liberals and | the Catalan Independents. | The Count de Bugallal, minister of economy, 1s chief of the Conservative party. Juan Ventosa, minister of | finance, is a right-hand man of Cambo, | the Barcelona financier, who is leader ! of the Catalan grcup. The Duke of Maura, minister of labor, is the son of the premier who | founded the Conservative party. His brother, Miguel. a Republican leader, | is still in jail for participating in the unsuccessful revolt of last December. Juan de la Clerva, father of the inventor of the autogyso, is a prom- inent Conservative leader, known as a | loyal supporter of the monarchy. He | served in one cabinet as minister of | the interfor. Former Mayor in Cabinet. T Marquis de Hoyos is a former Mayor of Madrid. The designation of Admiral Aznar de- | veloped after a five-hour meeting last night of the Monarchist representatives at the ministry of war. After the meeting Dr. Julio Wais, minister of finance in the resigned Be- | renguer government, announced that an agreement had been reached to collab- orate in a government in which the only Monarchist group to be excluded would be that headed by Sanchez Guerra. Admiral Aznar was born September 12, 1870, and entered the naval school | at'San Fernando when he was only 14 | years old. He saw war service in Cuba | and the Philippines and also command- | ed parts of the fleet in the Melilla cam- paigns. An enthuslastic crowd met Queen Vie- toria when she arrived during the night from England, where she visited her mother, Princess Beatrice, and cries of “Viva la Reina” were heard. At the palace the cheering was so prolenged ! that both Queen Victoria and King Al- fonso_appeared on the balcony. tains that the Indians themselves were largely responsible for the killing of the bison. While the Blackfeet claim they had the right to 20 of these animals a | year for each member of the tribe, the Department of Justice has secured affidavits from older members that no such right was exercised while the herds were plentiful and that many of the Indians never had been in the common hunting ground. Land Claims Intricate, The claims for land, the Government insists, are intricate—bound up in the question of the validity of the treaty of 1868 and in any event the damages are far less than those claimed by the Blackfeet. Another matter which the councilors are trying to fix up in Washington is the status of what Mr. Brown calls “too late babies.” The tribal rolls were tribal council, an elective Jegislative body. They are Joseph W. Brown, president of the council; Robert J. Hamilton and Richard Grant. There are no longer any hereditary chiefs The Government, in the brief sub- mitted by Assistant Attorney General Charles B. Rugg, insists that the treaty, yegarded either as a contract or a com- pact between two peoples, the Indians gave up all right of exclusive oc- cupancy of the common hunting ground and that it became, in effect, part of the public domain of the United States and open to settlement. As for the hunting rights, the Government main- closed in 1919. Since then approximately 1,200 children have blen born who, under existing law, do not share in the tribal property. The council wants these children placed on the roll so that they will share equally with the others in what:ver the tribe obtains from the present claim and in other common property. Besides they are tryi to get the Department of the Interior to cancel a debt of n:arly 181,000,000 in unpaid assessments on an irrigation project in their territory which, they insist, never was practical, and to modify the regulations for se- curing oil well leases on the reservation, | 11 points which he called a THE EVENING STAR, WASHINGTON, D.' €., WEDNESDAY, FEBRUARY 18, 1931. INEW LAWS URGED | HOOVER'S PROTEST AT BONUS IGNORED Bill Is Reported Quickly to Senate and Action by Tomorrow Seen. ____(Continued From First Page.) 000,000 or more when the Treasury now faces a deficit of half a billion dollars, President Hoover said: “The welfare of the veterans as a class is inseparable from that of the country. Placing & strain on the sav- ings needed for the rehabilitation of emplyoment by a measure which calls upon the Government for a vast sum beyond the call of distress, and so ad- versely affecting our general situation, will in my view not only nullify the benefits to the veterans but inflict in- jury to the country as a whole.” The Senate supporters of the bonus legislation were determined to force the bill before the Senate for early consid- eration. A motion by Senator Ashurst of Arizona, Democrat, to discharge the committee from further consideration of the House measure was pending in the Senate when that body met at noon. House Gave All Bonus. The House Ways and Means Com- mittee, when it brought out the bonus bill which was passed by the House by a vote of 363 to 39, discarded a pro- posal that the loans to veterans of the World War be confined only to those who could show that they were in act- ual need. The attitude of many members of the Senate has been to liberalize the bill passed by the House, rather than to restrict its provisions. President Hoover's letter to Senator Smoot set forth the fact that the chair- man of the Finance Committee had re- quested the Chief Executive to give his views on the House bill. “In view of the short time remaining in this session for its consideration, I shall comply with your request,” con- tinued the President. May Need $1,000,000,000. The President, basing his opinion on information conveyed to him by Gen. Frank T. Hines, administrator of vet- erans’ affairs, expressed the view that 75 per cent of the veterans would claim the loans. or 2550000 in all. This would require, the President said, the Government to raise approximately $1,000,000,000 to meet the loans. The Chief Executive said he would not undertake to “enumerate all of the grounds for objection to this proposal.” He said, however, that a number are most serious, “some of which are mat- | ters of method and some of which are matters of fundamental principle affect- ing the future of our country and the sarvice men themselves.” ’ “I have supported,” said the Presi- dent, “and the Nation should maintain, the important principle that when men have been called into jeopardy of their very lives in protection of the Nation, then the Nation as a whole incurs a special obligation beyond that to any other group of its citizens. These ch- ligations cannot be wholly met with dollars and cents. But good faith and gratitude require that protection be | given to them when in ill health, dis- tress and in need. Over 700,000 World War veterans or their dependents are today receiving monthly allowances for these reasons. Bars Those Self-Supporting. “The country should not be called upon, however, either directly or in- directly, to support or make loans to those who can by their own efforts sup- port_themselves “By far the largest part of the huge sum proposed in this bill is to be avail- able to those who are not in distress.” Senator Harrison, Democrat, Missis- sippl, asked Chairman Smoot after the letter was read if he thought President Hoover would veto the bill. “I think he will, Senator Reed, Republican, Pennsyl- vania, sald, “That is a fair interpreta- tion of his letter.” Undersecretary Mills of the Treas- ury came to the Senate committec | hearing with Director Hines. Estimate of Loans. Senator Reed asked what proportion of veterans would exercise their right | to borrow 50 per cent of the bonus cer- tificates. Gen. Hines said “if employment con- ditions continue as now we should be prepared to take care of 75 per cent cf the_veterans.” “That means 2,550,000 veterans,” he continued, “to whom we would pay out $1,283,000,000. Subtract from that the $330,000,000 already loaned and this bill will cost just less than $1,000,000.000 Hines said the 41 per cent interest rate allowed by the legislation was going | to attract borrowers Reed Suggests Change. Senator Reed suggested making the loans available only to those who have already borrowed on their certificates | at 6 per cent interest. Senator Harrison protested “this | would not help the fellow now in dis- | tress.” Hines recommended two proposals: (1) Limitation of the loans to those in | | distress, and (2) Payment of the loans | over monthly or quarterly periods The administrator expressed confi- dence that th> veterans’ own statement would be sufficient to determine the | factor of need Mills testified he believed the veteran “with gumption” would take advantage of the 4'. per cent interest rate 1o make the loans and “make some money." “The average veteran without gump- tion would take advantage of it any- | way,” he added. “You are going to make a difficult {tuation for the Treasury,” he said, ‘and possibly do harm to the business recovery of the country.” Bonds Held Necessary. Mills told the committee it would “be absolutely necessary” for the Treasury to issue bonds to meet the cost of the legislation. “It seems to me to be just common ordinary good business for the Govern- ment to keep out of the bond market now,” he added with some heat. He said at the March 15 quarter the Government would engage in a $1,600,- 000,000 financial transaction. Of this, i he said, $1.100,000,000 would be a re- funding operation and $500,000,000 would be for new money for the Treas- ury. Vandenberg Gives Data. An argument that the bill would ne- cessitate no additional Treasury financ- ing but would take care of itself was made by Senator Vandenberg, original sponsor of the 50 per cent loan measure. To correct what he termed “miscon- ceptions” of the legislation, he outlined “‘succinct summary of facts in connection with the measure.” They were 1. A total of 3,500,000 adjusted com- pensation certificates were issued with a maturity value of $3,500,000,000, the average certificate being $1,000. The total loan value on the cer- tificates to date is $730,000,000. 43 Per Cent Borrowed. 3. Total loans on the certificates to date are $325,000,000, leaving $405,000,- 1000 in unused loan privileges. 4. To date 48 per cent of certificate holders have used 43 per cent of exist- ing loan privileges. 5. Pending bill increases from 22 to 50 per cent the amount that may be borrowed on face value of certificates, adding a grand maximum of approx mately $1,000,000,000 to loan privileges. But if the same percentage of lcens persists under the bill as undar the present law, it will add “only about $430,000,000 to outstanding loans.” 6. The $430,000,000, therefore, is the additional financing req by pending Hoover’s Letter States Objections to Bonus As House Frames It. (Continued From Pirst Page.) ernment of about $1,712,000,000, and, less the loans made under the o act, the total cash which might be re- quired to be raised by the Treasury is about $1,280,000,000 if all should apply. ‘The administrator of veterans’ affairs informs me by the attached letter that he estimates that if present conditions continue then 75 per cent of the vet- erans may be expected to claim the loans, or a sum of approximately $1,000,- 000,000 will need to be raised by the Treasury. Finds Serious Objections. “I will not undertake to enumerate all of the grounds for objections to this proposal. There are a number of most serious objections, some of which are matters of method and some of which are matters of fundamental principle affecting the future of our country and the service men themselves. “I have supported, and the Nation should maintain, the important principle that when men have been called into jeopardy of their very lives in protec- tion of the Nation, then the Nation, as a whole, incurs a special obligation be- yond that to any other groups of its citizens. These obligations cannot be wholly met with dollars and cents. But good faith and gratitude require that protection be given to them when in ill health, distress and in need. Over 700,000 World War veterans or their de- pendents are today receiving monthly allowances for these reasons. _The country should not. be called upon, how- ever, either directly or indirectly, to sup- port or make loans to those who can by their own efforts support themselves. “By far the largest part of the huge sum proposed in this bill is to be avail- able to those who are not in distress. Delicate Situation Cited. “THe acute depression and unemploy- ment create a situation of unusual eco- nomic_sensitiveness, much more easily disturbed at this time than in normal times by the consequences of this legis- lation, and such action may quite well result in a prolongation of this period of unemployment and suffering in which veterans will themselves suffer with others. “By our expansion of public con- struction for assistance to unemploy- ment and other relief measures, we have imposed upon ourselves a deficit in this fiscal year of upwards of $500,- 000,000 which must be obtained by issue of certificates to the investing public. This bill may possibly require the se- of a further billion of money likewise from the public, Beyond this, the Government is faced with a billion dollars of early maturities of outstand- ing debts which must be refunded aside from constant renewals of a very largs amount of temporary Treasury obliga- tions. The additional burdens of this project cannot but have damaging effect at a time when all effort should be for the rehabilitation of employment through resumption of commerce and industry. “There seems to be a misunderstand- ing in the proposal that the Government securities already lodged with the Treas- ury to the amount of over $700,000,000 as reserve against these certificates con- stitute available cash to meet this po- tential liability. The cash required by the veterans can only be secured by the sale of these securities to the public. Sees Need of Funds. ‘The Jegislation is defective in that this $700,000,000 of Government securi- tles is wholly inadequate to meet either a potential liability of $1,280,000,000 or approximately $1,000,000,000 estimated as possible by the administrator of vet- erans' affairs, and provision would need to be made at once for this deficiency. “The one appealing argument for this legislation is for velerans in distress. The welfare of the veterans as a cla: is inseparable from that of the country. Placing a strain on the savings needed for rehabilitation of employment by a measure which calls upon the Guvern- ment for a vast sum beyond the call of distress, and so adversely affecting our general situation. will. in my vie not only nullify the benefits to the vef eran but inflict injury to the country as & whole.” Letter From Hines. Attached to the letter was the fol- lowing_one to President Hoover from Gen. Frank T. Hines, administrator of veterens' affairs “My dear Mr, President: “You have requested that I advise you as to the estimated number of veterans who would be eligible for loans, and the amount which would be borrowed on adjusted service certificates | in the event H. R. 7054 becomes a law. “When I appeared before the Com- mittee on Ways and Means, House of Representatives, February 12, 1931, in | connection with this measure, I made the following statement in reply to Representative Ramseyer “+e "+ "+ Based on your experlence and knowledge of the ex-service men, are you prepared to make any estimate as to the increased borrowers that a bill like this would probably bring about? Expects 2,550,000 Loans. “‘Gen. Hines: Well it depends a great deal. Congressman, on whether the present employment conditions are going to continue. If there is a period still of another year where unemploy- ment is not going to improve, it would be my judgment that there would be an increase of at least 25 per cent in the men who would borrow." “In accordance with the above, it is my estimate that 2,550,000 veterans will avail themselves of the full loan value under the proposed measure and that the total amount of such loans will be $1.283,625,000. From the amount there should be subtracted the $325,000,000 which has previously been borrowed, making a total additional amount which | will be borrowed of $958,625,000, or ap- proximately $1,000,000.000. “Respectfully, “FRANK T. HINES. Administrator.” MERGING FORECAST OTTAWA. Ontarlo, February 18 (#)— The amalgamation of all "ex-service men’s organizations in Canada into one | association was forecast today as a Te- | sult of executive meetings of army and navy veterans held in Ottawa this week The army and navy directors in a declaration of policy asserted their be- |iief “that steps should be taken im- | mediately to complete the uniting of all national ex-service men’s associa- tions in Canada into one corporate entity.” bill. In other words, it is a little more than the Treasury already is obligated to_ make all veterans. 7. The Treasury has deposited $750.- 000,000 in certificates of indebtedness to the maturity fund and can cover the $430,000,000 by these certificates, leav- ing $326,000,000 over in the fund. Merely Hastens Loans. 8. To finance the $430,000,000 addi- tional loans the Treasury must redeem for cash certificates of indebtedness in the fund. In the next 12 months the Treasury will have $403,000,000 to re- duce the public dcbt, and under the law it can retire the certificates up to thi amount. 9. Even if total loans e:32 4 _.pec- tations, the handling vill 1: only a “credit operation sni <-::n't invelve any additional tax kuiden at any point in the calculation.” 10. If th> insurance was a regular one-peyment, 20-pay life policy, the loan velue today would be 53 per cent, instead of 50 per cent, as proposed. 1. Even on the basis of the present terms of the compensation certifi insurance the loan value would reach the same 50 per cent in 1937. The only thing, therefore, that is proposed is to “move the loan privileges al by six years. 5 FOR REALTY DEALS Blaine Subcommittee Hits Viciously at Alleged Prac- tices in District. (Continued From First Page) _ the company had no title, “and as the result of various false representations.” In reference to the bill to license real estate brokers and salesmen, a meas- ure passed already by the Senate but on which the House has not passed, the committee declared that it believed a law “would give public protection that is urgently needed, by substantially reducing iraud and imposition prac- ticed on the people by unscrupulous real estate operators and for the pro- tection of a legitimate business and honest realtors.” Procedure Here Blamed. Discussing the mortgage foreclosure situation, the committee declared that the District is practically without laws providing for an “orderly, regular form of procedure” for foreclosure of mort- gages or deeds of trust. The length of notice, if any, given to a mortgage debtor, the time, place. terms of sale and the compensation of a trustee are all matters left to the discretion of the trustee, mortgagee or No period of redemption from a fore- closure sale is allowed the mortgagor or grantor in a deed of trust, under ex- isting law, and once a sale has taken place because of a default, no matter how slight. and whether or not reason- able notice has been given, the mort- gage debtor is foreclosed from any recovery of the property no matter how substantial his equity may kave been, the committee stated. Check-up on Foreclosures. “A detailed examination of the rec- ords of 150 foreclosures showed that in a very large number of instances the property was purchased at the sale by the person or firm making the loan, or an agent or employe,” he report con- tinued. “Such persons were in position to profit by the foreclosure and charges and subsequent resale. Instances were found of repeated sales of foreclosures of the same property.” The report quoted the following dic- tum by the District Court of Appeals in a recent case: “There are few, if any, jurisdictions where the matter of foreclosure is con- ducted in the summary way that pre- vails in the District of Columbia, where, under a power of sale conferred in_the deed of trust, the trustees may, on short published notice, sell the property mort- gaged without any right of redemption in the mortgagor.” Counsel Ts Quoted. Nathan William MacChesney. gen- eral counsel of the National Association of Real Estate Boards, was quoted by the committee as foilows: “It is my judgment, based on prac- tical experience as a lawyer handling a large number of foreclosures, that there could be no real objection to a fair notice being_ given prior to foreclosure and to a redemption period of at least 30 days thereafter. Personally, I would not favor any bill that did not contain some such provision.” The committee added: “The present {1aws of the District contain no protec- tion of any kind.” The bill as recommended by the Blaine committee would provide for 25 days' published notice before foreclos- ure sale, for a 15-day redemption period after sale, for limitation of fees, for notice to all interested parties and for a certain definite legal procedure pro- tecting alike the rights and intereste of borrower and lender. Provision Against Fraud. “Particular provision is made against fraud and misappropriation by trustees, the need for which has been demon- strated recently in the District of Co- lumbia,” the report concluded. The committee report also contained a great volume of its findings in its investigation of the mortgage bond is- sues placed on Washington properties by large and national bond concerns of high reputation. Criticism is voiced against what was alleged to be excessive appraisals in these cases, and also in the case of the F. H. Smith Co. Huge Security Sales. “Detailed investigation by the sub- committee,” the report states, “has de- veloped the fact that within the past six or seven years, there has been issued or sold from the District of Columbia so-called ‘securities,’ largely consisting of morigage bonds or notes, in an amount approximating $100,000.- 000, a very considerable portion of which are of very dubious value, and in some cases utterly worthless. “In the sale of such securities—many | of which have been distributed to wom- en as safe investments for insurance and savings funds and to a large class of people who have no detailed knowl- | edge of investment principles—there has | been gross misrepresentation of values, |and concealment of essential facts as {to value amounting to fraud, criminal in character.” In this connection the committee urged enactment of the “blue sky" com- on type of legislation, rather than a aud” law, holding that the for- | mer, sponsoied by Senator Blaine, would more effectively reach fraudulent or unsound dealings. The “blue sky” bill would set up a commission to pass upon realty securities befcre they could be offercd lor sale, as well as providing for the licensing and bondiag of dealers in mortgage bonds. Another Type of Bill. vides for the licensing and bonding of security dealers and gives the United States attorney powers of injunction to Stop the sale of security issues, inves- tigation and prosecution Details of the investigation of the bond issues on the large Wardman-built properties and the Mayflower Hotel, ob- tained at the recent hearings, were in- cluded in the report to the Senate. In connection with the mortgage is- sues on the Wardman properties, the committee states: “Four members of the Investment Bankers' Association of America, name- ly. Halsey Stuart & Co., Inc.; Hamble- ton & Co., A. B. Leach & Co., Inc., and Rogers Caldwell & Co., Inc., together with William R. Compton Co., spon- fering throughout the country of what they designated on their circular to be *$11,000.000 first and refunding mort- gages, 62 per cent serial gold bonds,’ of the Wardman Real Estate Proper- tes, Inc. Deception Is Seen, “Even the printed description of this issue was deceptive, for, in reality, the authorized issue of bonds wa: $16,000,- 000, and the security back of the bond issue was not a first mortgage on all of the property cf the issuing corporation, but a second ¢nd possible third mort- gage as to some of the properties in- volved.” Tn counection with the Mayflower Hotel Co. bond issues, the committee repoiied that Halsey, Stuart & Co., Inc., and the American Bond & Mortgage Co. participated in sale of bonds. On this hotel property there was issued first mortgage bonds of $7.500,000, second age bonds amounting to $2,400,000 and preferred stock of $1,100,000, with also an authorized issue of 80,000 shares of common stock, the committee reported. “These security issues were based on extravagant valuations distributed by the investment bankers,” the committee found. ‘While the property was found by the District to have a total assessed value of $5,232,120, the Senate was told, head bonds amounting to $9,900,000 were ise sued against the h “cestui que trust,” the committee found. | The other type of securities bill pro- | sored and participated in the public of- during his administration. IMERGER INDORSED; FORMER POSTMASTER GENERAL HARRY S Appeared before the Senate Postal Lease Investigating Committee and entered a vigorous defense of the Post Office Department’s conduct in negotiating leases He was photographed on the witness stand. —A. P. Photo, Income Tax Facts. No. 17. The revenue act requires a re- of every single person whose net income for 1930 was $1,500 or more, every marricd couple living together whose net income was $3,500 or more, and every person, single or married, whose gross income was $5,000 or more, regardiess of the amount of net income. The tax being on net income, necessarily many returns are filed that are not taxable. Net incoms is gross income less certain specified deductions for business expenses, losses, taxes, charitable contributions, bad debs, etc, to b2 fully explained later. Al incom:, derived from any source whatever, unless ex- empt from tax by law, is gross in- come. However, in the case of a person engaged in trade or busi- ness, gross recepits do not neces- sarily constitute gross income. Such a person, in determining gross income, may deduct from the gross sales the cost of the goods sold, but not the expenses of the busin‘ss. For example, if the gross sales were $50,000, the cost of goods sold $35,000, and the business expenses, etc.. $12,000, the gross income is $15,000 and the net income $3,000. In this case, if th> person is married and living with_his wife, he is re- quired to file a return, although his personal exemption of $3.500 renders the return non-taxable. Here arises the question, “Why is a return demanded waen the per- sonal exemption and credit for dependents exceed th: amount of net income and thus reflects a non-taxab'e return? ‘The filing of a non-taxable return, however, is not a usel'ss procedure, as far as the Government is concerned. Upon examination many returns claimed to be non-taxable are found to be taxable, the person filing the return having claim:d more in amount than the per- sonal exemption and credit for dependents to which he s entitled. {SENATORS TO HEAR OF D. C. MILK PRICES AT FOOD INQUIRY ___(Continued From First Page) spread” between the prices received by the market price of these commodities. fat have dropped from 33.4 cents in 1922 to 26.2 cents today, he said. The prevailing average butter price is 37.7 cents, he testified, as compared with 42.5 in December, 1930. Joseph A. Becker of the Agriculture Department testified the farmers were receiving $2.04 for a hundred pounds of milk in January of this year, the lowest price since 1917. The average price in 1930 $2.30, he added. Becker's figures showed the farmer's price has declined rather steadily since it reached a high of $3.42 in 1920. Fred H. Sexauer, president of the Dairyman’s League of New York, a co- operative organization which markets milk for 43.000 producers, testified that retail prices have dropped correspond- ingly with the prices paid members of his association He denied that his league, which he said controls between 40 and 50 per cent of the milk in its territory, fixed the retail milk prices. The purpose of the organization, he added. was to eliminate unfair competition and stabilize the industry. F. D. Walmsley, president of the Bor- den’ Farm Products Co., which distrib- utes between 35 and 40 per cent of Chi- cago's milk, produced figures which he said showed the consumer had received the full benefit of reduced prices to the farmers. His company, he testified, reduced its prices from 14 to 13 cents a quart at the beginning of this year and the farmer’s price was cut of a cent. AVALANCHE KILLS SEVEN ISTANBUL, February 18 ().—Seven peasants were buried alive yesterday in a snow avalanche in_the mountains of Eastern Turkey near Malatia. Rescuers found the bodies. It was feared also today that several farmers traveling between the villages | of Ortakeuy and Boulane had been lost in a blizzard. Reading From Play Arranged. Miss Rachel Sewall will give a dr: matic reading from “Green Pastures, Marce Connelly’s play, Thursday evening at 8 o'clock in the parish hall of the Church of the Holy City, Sixteenth and Corcoran streets, for the benefit of the | choir of that church. Incidental music suggestive of spirituals will accompany | the reading. the farmer for butter and cheese and | “The prices paid the farmer for butter | | he thinks the time is propil . c. ORDERS CUT IN GAS PRESSURE TO END DANGERS Sk A __(Continued Pfom Pirst Page) plied with as to the progress made to- ward such compiiance. “Kindly acknowledge receipt of this letter.” Announcement also was made ot the commission today that protests over increased gas bills are continuing to come in by mail and telephone. As- | surance is given each complaintant that the commission will do everything in its powei to determine the cause of the increases. Richmond B. Keech, people’s counsel before the commission, also said he had received a number of additional com- plaints since his announcement several days ago that he would ask the en- | ginieering department of the commission to inquire into the cause of the rising bills. |~ The most recent protest received by | Keech was written by a prominent Gov- | ernment, official, who said that his bill | had gone up 100 per cent despite the | lower rates in effect, although he was confident the consumption of gas in his | home had not increased. certainly not | to that extent. | Higher Pressure Blamed. ‘ ‘The bill to authorize merger of the | Washington and Georgetown Gas Light Cos. was postponed by the Senate again last night upon objection of Senator | La Follette of Wisconsin. The bill has been reached on the call of the calen- | dar several times this season, but Sen- |ators La Follette and Howell are op- | posing its consideration in its present form. Recent disclosures by Bert M. Peck, chief engineer of the Public Utilities Commission, that gas pressures had been increased in violation of commission regulations, and in scme instances dou- bled, Senator Howell said, undoubtedly explains the reason for some of the higher bills. “Higher pressure, without an accom panying adjustment in gas appliances, he declared, “means higher bills.” ‘ Senator Howell is regarded as an ex- pert on public utility matters, and is one of the best informed members of the Senate on the affairs of the Wash- ington Gas Light Co. because of the searching investigation he made of this utility corporation when the gas merger bill was introduced. For 10 years be- fore coming to the Senate, he was gen- eral manager of the Metropolitan Utili- | ties District of Omaha, which operates public water, gas and ice plants. | Wants System Changed. | “My impression is that many of the gas mains in Washington are small; too small for high pressure,” said Senator Howell. “Small 2-inch mains are nu- merous. While I don't know what the minimum requirements are in Washing- ton, I do know that the smallest mains permitted in Omaha are 4 inches.” |~ Senator Howell declared that if high- er pressures are to be used in Washing- | ton, improvements should be made i the main and distributibn systems, and | by all means, gas appliances shouid ve | adjusted for the increase. Instead of | raising pressures throughout the entire | distribution_system to meet conditions in communities where consumption has increased, he said, the company should | construct high pressure mains_ directly | to those sections and regulate the pres- | sure there by station governors. | Senator Howell has offered vigorous opposition to the gas merger bill, and intends to fight it to death in the Sen- ate, unless it includes further conces- sions to the public. While he recently agreed to drop that part of ais amend- ment requiring the merged ccmpeny to accept his schedule of reduccd rates, he proposes to continue his opposition to the merger unless the bill contains a provision eliminating going concern value as an element in determining the rate base in any future revaluation of the gas properties. Going Concern Value. | Elimination of going concern value, | Senator Howell pointed out, will cuf | from $5.000,000 to $6.000,000 from the iluation of the gas companies and result in lower gas rates. The pro- vision he is seeking to insert in the bill sets forth that in arriving at the value of the gas plant for rate-making pur- poses nothing shall be included on ac- count of the franchise or going value, and that the rate of return on the valuation thus determined shall not | exceed 7!, per cent. Senator Howell said he would not ad- vocate a revaluation of the gas prop- erties at this time because he had been told it would be unfair to the new owners of the gas companies, although ous. “There has never been a better time in 15 years than the present for a re- i!AIi.D CONCERT. | By United States Marine Bahd Or- chestra this evening at 8 o'clock at the | auditorium, Marine Barracks, Taylor | Branson, leader; Arthur S. Whitcomb, | second leader. Overture, “Carneval Romain”. . Berlioz| Interm Dream After the Ball Excerpts from_ “Aida’ “The Break of Day," ‘Khovantchina” . “The Banks of the from the suite, Valse Caprice, “Lady Hamiltor Suite, “Peer Gynt,” No. 1 “Morning.” “Ase’s Death.” “Anitra’s Dance.” 0, c “Dance of the Imps in the Hall of the Mountain King.” Marines’ Hymn, “The Halls of Montezuma.” “The Star Spangled Banner," | companies. valuation,” said Senator Howell. “In- dex figures are low and I believe should be taken advantage of now. However, 1 am not prepared to say whether the gas properties in Washington should be revalued at this time, because I have been told it would be unfair to the gas And I don't want to be unfair. The Public Utilities Commission is in a better position than I am to be | the judg Will Drop Rate Schedule. The amendment which Senator How- ell proposed to the merger bill pre- scribed a maximum schedule of rates for general gas service. This schedule would make the net rate for the first 2,500 cubic feet consumed per month 85 cents, and for all over 2,500 cubic feet the net pate per %,0Q0 cubic feet cents. ginimum per month would be 60“ggnts. tor Howell, however, has Wgreed to ab:nden his fight for this schigule. Yet he still believes the small consufige: ONE VOTE IS CAST Gas Company Head Presides as Chamber of Commerce Aids His Concern. With George A. G, Wood, head of the Washington Gas Light Co., presiding over the meeting as acting president, the Washington Chamber of Commerce last night at its meeting’ at the May- flower Hotel indorsed the measure now before Congress providing for the merger of the Washington and the Georgetown .gas companies, The action was taken on the recom- mendation of the Public Utilities Com- mittee of the chamber. When the matter was put to a vote by Mr. Wood, Wwho recently was elevated to the first vice presidency of the chamber, there was but one vote cast by the member- ship of the organization, and that was in favor of the merger legislation. Two hundred members attended the meet- ing. “It’s a vote.” said Mr. Wood, declar- ing the resolution ddopted. | praised the chamber for the s of its action, adding that, I merger bill appears to be “dying” in Congress, “it is good to know who one's friends are and good to know who one enemies are.” Demonstrations Given. The proposed bill would authorize the Public Utilities Commission to approve a merger of the two gas companies, which already are under the same gen- eral ownership. The romantic as well as the com- mercial and pubic phases of modern public utility “developments were foa- tured at the meeting. Demonstrations ot some of the mar- vels of modern communication and various by-products of experimentation in sound and light waves were given in sound motion pictures made by the Bell Laboratories and presented by the local phone concern. The chamber went on record oppos- ing the proposed change in the present system, under which the rates of the Potomac Electric Power Co. are fixed annually. Phone Head Guest. Lloyd B. Wilson, president of the Chesapeake & Potomac Telephone Co., was honor guest of the meeting, and W. W. Wheeler, general information manager of the telephone concern, told of the work of the local and regional phone company, its plans of expansion, its present facilities and its relation to the American Telephone & Telegraph Co. and to the Bell Laboratories, which carries on extensive experimentation, {from which some of the radio and other inventions snd developments are credited. Cost Reduction Seen. ‘The chamber resolution on the gas merger also stated that it is & lieved ‘the proposed consolidation of the two companies, already under the same ownership, would pave the way for reductions in manufactur- ing cost and improvements in service greatly to the benefit of the citizens of District. In acting on the disputed matter over how the rates of the Potomac Electric Power Co. should be adjusted annuali the chamber declared that the po company “because of its unique record of service, has earned the commenda- tion and appreciation of the citizens ot Washington.” Declaring that it wculd oppose any effort made eithzr by th> Public Utli- ties Commission or the power company to abrogate the present consent d-c-e under which rates are fixed, without thére being recourse to the courts. ¢ chamber declares that if, after r taking investigation, the comm:: that further modification existing rate schedules is porsible, it should take such question up with tiv power company for co-operative con- sideraticn in public interest. The chamber went on record as “un- alterably opposed” to coercive action, directly or thfough the courts, “which might usher in another 10-year period of legal combat, the effect of which would be indefinitely to postpone the rate reductions which the public has been enjoying under the present ar- rangement.” . Eight-Hour Day for Firemen. Charles W. Darr, chairman of the Police and Fire Protection Committee, presented a resolution, adopted by the chamber, urging establishment of a three-platoon system in the District Fire Department to give the firemen an eight-hour day, instead of one of 12, and to place the firefighters on a parity with policemen. The chamber approved a recom- mendation of the Transportation Com- mittee, offered by George Keneipp, urg- ing the widening of Thirteenth street from Monroe street to Spring road, and another resolution, approving a cam- | paign waged by the Board of Trade, urging that Thirteenth street be re- tained as a traffic inlet to the Mall, running through the Federal building | development from Pennsylvania avenue to B street north Approval by Congress of a 15-year building program for the local public li- braries system, recommended by the Li- braries Committee of the chamber, was urged by the trade body. This would provide for a definite 15-year expansion program, calling for the purchase of addi- tional sites for additional branch libra- ries, a financial program for construc- tion of the additional build: , and for a project to double the &i of the present Central Public Library. The films presented by the telephone company illustrated the elementary phases of the scientific marvels under- lying the making of “talking” motion pictures by means of animated ‘“car- toons.” There were sound pictures also illustrating basic, principles of the radio reproduction of speech and music, and another film illustrating the value of radio to aviation. PERSHING IS BETTER Gen. John J. Pershing, who has bgen suffering with a severe cold, was suf- ficiently improved today to spend some time working at the desk in his room at the Metropolitan Club Army Medical officers attending the general advised, however, that he not Teave his room for several days because of the changing weather. Warning! ‘Word comes from the Assb- ciated Press of embarrassment and apnoyance inflicted by im- postors and petty grafters, who in many cities of the country, by posing as Associated Press rep- resentatives, have victimized mer- chants and others. For the protection of our citi- zens we can say authoritatively that the Associated Press does not issue badges or printed cre- dentials to its representatives. Its emploves do not ask for spe- cial privileges, advances of money, credit at hotels and other public places of entertainment. They do not ask banks to cash checks without complete identification; they do not solicit the purchase of any article, or endeavor to sell anything. We wish our business men and citizens to know that when any person comes to them seeking favors or making any solicitation Im'olvtn% money or credit on the ground that he represents the As- soclated Pregs, it is safe to set that person down as an impostor regardless of the nature of his urported credentials.