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Evening star. [volume] (Washington, D.C.) 1854-1972, June 21, 1934, Image 1

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(V. 8. Weather Bureau Forecsst.)
Pair and continued warm tonight; to
morrow local thundershowers; cooler to
morrow afternoon and night.
Temperatures—Highest, 91, at noon
today; lowest, 69. at 5 a.rj. today.
Pull report on page 9.
Closing N. Y. Markets, Pages 13,14 & 15
"From Prett to Horns
Within an Hour**
The Star's Carrier system covers every
city block and the regular edition is
delivered to city and suburban homes
as fast as the papers are printed.
Yesterday's Circulation, 117,529
No. 32,923.
Entered as second class matter
post office. Washington, D. C.
C4>) Meant Associated Prats.
All Nations Prepared to De
mand Increases Over
1930 Level.
MacDonald Likely to Be Forced
to Ask Greater Tonnage for
British Fleet.
Ambassador at Large Norman H.
Davis, who with Ambassador Robert
W Bingham is discussing in Lon
don the preliminaries of the naval
conference to be held in 1935, reports
that, v.hile the conference may still
be held, it does not look as if it will
bring about a reduction of naval
On the contrary, the Ambassador is
worried that it may lead to a new
naval race.
The preliminary conversations in
London have proven so far that, while
Ramsay MacDonaid is theoretically in
favor of naval reductions, in fact he
is forced by public opinion and the
admiralty to demand a larger tonnage
for the British fleet than it has today.
The arguments in favor of this in
creased tonnage are two:
(1) The dominions, especially Aus
tralia and New Zealand, have neg
lected their naval defenses in recent
years. While they are awakening
now to the necessity of an adequate
sea preparation, they have not the
necessary means to increase their
fleets substantially. Consequently it
is up to the mother country to pro
vide their naval defenses in the shape
of cruisers and destroyers.
Exceed 1930 Program.
(2) The naval armaments of Prance,
Italy and Germany exceed today the
progTam they had in mind in 1930,
when the London naval agreement
was signed. The British admiralty
is standing pat on the "two-power
standard," which requires that Great
Britain should have at all times a
fleet equal to any combined two Eu
ropean fleets. Hence the necessity of
building more ships than the London
agreement provided for.
While the conversations between
Davis and the Japanese Ambassador
in London have not given any posi
tive results. Ambassador Matsudalra
still is waiting for instructions from
Tokio and the Japanese government
has taken care to make its point of
view known unofficially by the decla
rations of high officials of the navy
department. Japan demands parity.
That does not mean a theoretical
parity as exists today between Great
Britain and the United States, but a
strong fleet capable of dominating the
Pacific against any possible combina
tion of forces.
In order to have this, it is necessary
for Japan not to have its hands tied
by any treaty limitations, but to be in
a position to build any ships its navy
department may deem necessary to
assure Japanese supremacy in Asia.
Their building program will have to
be guided, consequently, by what the
other nations interested In the Pa
cific will build.
Oppose Fixed itauo.
The French and Italians are as re
luctant as they were In 1930 to be tied
down to certain ratio.
The decision of the Italian govern
ment to build two battleships of 35,
000 tons, as provided in the Washing
ton Naval agreement of 1921, has
stirred up the French who have used
heretofore only a portion of that allo
cation by building a battle cruiser of
25,000 tons, the Dunirque. as an an
swer to Germany building the 12,000
pocket battleships "Ersatz and Preus
sen." It is fully expected the French
will increase their navy by adding
(Continued on Page 2, Column 7.)
Former Los Angeles County Re
lief Officials Cited by Grand
By the Associated Press.
LOS ANGELES, June 21.—C. W. A.
scandals, apparently dead in Los An
geles County after a sensational ex
pose months ago, were resurrected with
startling suddenness today in an in
dictment by the Federal grand jury,
charging nine former officials of the
C. W. A. and the F. E. R. A. with
conspiracy to defraud the Govern
One Indictment charged defendants
permitted the expenditure of funds
for the employment of men on proj
ects not approved, sent them to work
without plans or tools, forcing them
to remain idle, while paying them
$500,000 for labor not performed and
causing their activities to be reported
falsely by timekeepers.
The other alleged Harry E. Walker,
in charge of the re-employment of
fices for the State under the F E.
R A., established employment offices
here without authority, conspired
with two others to defraud the Gov
ernment, Issued C. W. A. work orders
to improperly registered persons,
tampered with ratings, caused work
orders to be issued in excess of the
allotment of 60,000 and issued 32,000
illegal orders
R. C Branlon. emergency relief di
rector for the State, is one of the
vGuide for Readers
Amusements B-14
Comics C-8
Features C-6-7
Financial A-13-14-15
Lost and Found A-9
Radio B-13
Serial Story C-ll
Sports C-l-2-3-4
Regions in Turkey Especially Hard Hit.
Shocks Also Are Felt in Ger
many and Nicaragua
By the Associated Press.
Earth shocks over widely separated
portions of the globe Wednesday are
feared to have caused extensive dam
Dispatches from Istanbul said an
unknown number of persons had been
killed in an earthquake in Western
Turkey, which was accompanied by a
sluicing downpour of rain.
The region worst affected was
Smyrna, where communications, mea
ger at best, were reported completely
disrupted by the violence of the
tremors. Detailed information was
not available.
Villages were inundated by cloud
bursts at the same time they were
being shaken by temblors, causing
enormous panic among the populace.
Reports from Buethen, Germany,
said an earthquake in Upper Silesia
entombed seven miners in the Kars
ten Zentrum pit. and was sufficiently
strong to crack the walls of build
An earthquake of considerable in
tensity was felt In Managua. Nica
ragua, early yesterday morning.
Disastrous quakes also have been
reported recently from India and
South America.
Heavy Shocks Believed to Have Left
Many Dead.
SMYRNA, Turkey, June 21 (4>).—
The region Afiunkarahissar in West
ern Anatolia was shaken yesterday
evening by a violent earthquake which
lasted 20 seconds, followed by shocks
which continued at intervals through
out the night.
Damage was heavy and there were
believed to have been many human
casualties, although the number could
not be immediately determined.
Shocks of considerable violence were
experienced also at Diner, Sandikli,
and Bulavadin.
Fires followed in some places and
hundreds of houses were reported
wrecked by cloudbursts In a fierce
storm which followed the quake.
Visit to Neudeck Follows
President's Approval of
Papen Criticism.
By the Associated Press.
BERLIN, June 21.—Chancellor Adolf
Hitler left today for Neudeck to con
sult President Paul von Hindenburg,
who yesterday indorsed a vigorous
criticism of the Nazi regime by Franz
von Papen. vice chancellor.
Officially, Hitler's purpose was to I
report "to the Reich's president on
the Vcnice meeting with Mussolini."
It was generally assumed however,
that Von Papen's speech would be an
Important added subject of conversa
Agree on Many Points.
Von Hindenburg Is known to agree
on many points with Von Papen, who
represents the conservative element
In the government.
The visit assumed added signifi
cance when it was announced at the
vice chancellor's office that Von Papen
soon would visit the president.
A spokesman emphasized that Hit
ler and Von Papen would not be at
Neudeck simultaneously.
"They have settled their differ
ences," the spokesman added.
Political observers said Von Papen's
position following his bold criticism
of Sunday, in which he scored radical
experiments and "muzzling" of the
press was greatly strengthened by
Von Hir.denburg's brief telegram of
Given Advance Copy.
The president had been given an |
advance copy of the address, but
Chancellor Hitler had not.
A heavy sale of Swiss newspapers
carrying accounts of Von Papen's
speech was reported. Joseph Goebbels,
minister of propaganda, ordered news
papers in this country not to print j
the speech.
Birmingham Factory Will Also
Build 500 Cars for Seaboard
Airline Railroad.
By the Associated Press.
RICHMOND, Va., June 21—Re
ceivers for the Seaboard Airline Rail
road today announced 1.000 new
freight cars would be built for the
road by the Standard Steel Car Co.,
with the construction equally divided.
500 cars each, between plants in
Richmond and Birmingham.
The cost of the new cars was not
announced here, but the order was
considered a large one, probably
reaching $2,000,000.
The contract will result in the re
opening of the Fourth street plant
of the Richmond Car Co., which has
been closed some time, and the em
ployment of several hundred me
Work is to be started within the
next two months.
The Standard Steel Car Co. is a
subsidiary ot the Pullman Car &
Manufacturing Co.
Worst Inundation in 25 Years
Follows Rains.
FOOCHOW, China, June 21 UP).—
The worst floods in 25 years have
inundated this South China coastal
city to a depth in some places of six
Torrential rains at the headwaters
of the Min River caused the flood.
Traffic is carried on by boats. Scores
of houses have collapsed and Consid
erable loss of life has been reported
in outlying sections.
Move Up to Employers, With
Secretary Perkins Ex
pecting Compromise.
By the Associated Press.
It was steel's move today in the
negotiations to avert a strike.
Steel management has union labor's
demands. The Government awaited
acceptance, denial or a counter-pro
"There is no reason why a satis
factory adjustment can't be made,"
Donald Richberg. N. R. A. general
counsel, told newsmen
Secretary Perkins. President Roose
velt's agent In dealings with both
management and union labor, said,
however, that so tar there had been
no comment from the employers on
the union's proposal.
Miss Perkins and her aides hope
to work out a compromise satisfac
tory to both employers and the union
from proposals each has tuomitted.
Demand of Recognition.
The Amalgamated Association of
Iron, Steel and Tin Workers, the
principal steel union affiliated with
the American Federation of Labor,
threatened to call a strike unless
given "recognition" In collective bar
The union agreed, however, to post
pone the strike indefinitely if a three
man neutral board were appointed to
set on its grievances and to super
vise elections to determine whether
it should represent steel labor in
dealing with management.
Management also suggested ap
pointment of a three-man board to
look into the men's grievances and to
conduct elections. The employers
made It clear, though, that they
would Insist upon minority repre
sentation in collective bargaining in
case the union won the elections.
Union labor so far has Insisted that
majorities rule.
Will See Delegation.
While the steel men considered the
union demands Miss Perkins ar
ranged to see a delegation from the
steel and metal workers union, so
called "left" group of workers. The
date for the conference was not fixed.
During conferences yesterday Miss
Perkins, Richberg and Senator Wag
ner, Democrat, of New York, found
time to discuss the set-up of the
new labor boards called for in the
bill Congress passed just before ad
Wagner heads the National Labor
Board, which the new tribunals will
The three expect to have definite
recommendations ready for Mr. Roose
velt when he returns from his trip.
Uncorrected Mistake of Sleepy
Furniture Mover* Bevealed
in Flea for Loan.
By the Associated Press.
CHICAGO. June 21.—Because a
crew of sleepy furniture movers made
a mistake one dreary morning, two
Chicago families have been occupying
each other's homes for the past
seven years.
This came to light yesterday when
application was made to the Home
Owners' Loan Corporation for help
on a mortgage.
The houses, both in the sama block,
were new and very similar in appear
ance seven years ago.
But neither the Prank Drltsches
nor the Joseph Raabs wanted to cor
rect the error, so they merely trans
ferred titles.
of the
and other scenes in the celebration at St. Marys
City of the landing there 300 years ago of
Leonard Calvert and his colonists
are shown in a
Full Page of Photographs
in the
Rotogravure Section of Next Sunday's Star
Morgenthau Issues Order
to Workers Holding
Political Office.
Declares It Has Been Shown
"Man Cannot Collect for Uncle
Sam and Party Both."
By the Associated Press. |
All Treasury employes holding po
litical party offices in addition to
their financial Jobs were told today
by Secretary Morgenthau that they
must resign their party posts not later
than September 1.
Either these persons must separate
themselves from political activity or
submit their resignations from the
Treasury by that date, the Secretary
"I think It has been demonstrated
that a man cannot collect for Uncle
Sam and the party both." said Mor
genthau today at a press conference.
He made public a letter sent to all
Treasury bureau heads explaining his
The letter followed one of June 5
which directed attention of Treasury
employes to Federal law provisions re
garding political activity and solicita
tion of contributions for political pur
Fears Hampering or Duties.
"Since distribution of this letter, I
have received inquiries from several
employes of bureaus and divisions of
the Treasury as to the legality and
propriety of their continuing to hold
office in regular political party organ
izations," read the new letter. "X
have considered this matter very care
fully and I have come to the firm
conviction that no officer or employe
of the Treasury Department ought to
continue to hold any political party
"It seems to me that the holding
of any such political party office Is
not compatible with the public in
terest and will hamper the officer or
employe In the effective discharge of
his governmental duties."
Morgenthau followed that with the
request for resignation of either party
of Treasury jobs. Questioned concern
ing replacements of officials who have
been removed or have resigned from
the Treasury because of political ac
tivity. Morgenthau said he had done
nothing on new appointments and did
not expect to have anything on them
for some time.
Farley Takes Stand.
Postmaater General Parley, chair
man of the Democratic National Com
mittee, already had stated that cus
toms and internal revenue collectors
who are committee members must sur
render one of the two positions.
Horatio J. Abbott recently resigned
as collector of internal revenue at
Detroit following allegations that men
un£?r his command had solicited
political contributions. He still is a
member of the National Committee
Farley has said he saw no reason why
he should resign that post.
Alvin F. Fix, internal revenue col
lector at Philadelphia, resigned under
somewhat similar circumstances. His
resignation was requested by President
Roosevelt after Treasury investigators
had accused him of soliciting party
campaign funds.
Pour other employes In the Phila
delphia offic were suspended for a
year, and a fifth for a month.
President Roosevelt has gone on
record as opposing persons who hold
Federal jobs and membership on the
National Committee simultaneously.
He also has hit at prominent party
members appearing before Government
agencies. Several lawyers practicing
In Washington resigned their party
posts following a statement by hlin
to that effect.
Lake Michigan Area Combed for
Youth and Co-ed Lost After
By the Associated Press.
CHICAGO. June 2:.—A privately
chartered airplane aided Coast
Guardsmen from thrc: stations today
in a search for Raymond Gustafson,
24, and Miss Ruth Hatch. 25. who
failed to return last night from a sail
boat trip.
Gustafson and the young woman,
who is a Northwestern University
student living at his home, set out in
Lake Michigan from Belmont Har
bcr in an 18-foot sailboat, owned by
Gustafson. The two have frequently
taken boat trips together and were
said to be good swimmers and sailors.
When the pair failed to return, the
young man's mother. Mrs. Walter T.
Gustafson. fearing the slight craft
may have met disaster in the gale
which swept the lake shortly after
midnight, appealed to the Coast
Guard. Later she employed a com
mercial pilot to aid in the search.
Gustafson has written several mag
azine articles on Great Lakes naviga
tion. It was held likely that he and
his companion may have taken refuge
in some isolated port.
XT. S. Agents, Navy Officer and
Police Seek Mrs. Fidanque.
SAN JOSE, Calif., June 21 VP).—
Department of Justice agents, a
United States Navy intelligence offi
cer and police of a dozen California
cities today directed the search for
Mrs. Sibyl Fidanque. missing from her
home here since Saturday.
Theories, ranging from amnesia to
kidnaping, were presented by police.
The Navy officer. Lieut. A. J. Rich,
joined in the investigation at the re
quest of the attractive 39-year-old
woman's > husband. Joseph Fidanque,
Panama shipping man.
f bots.thc
[chiefs a
Trdde Commission Will
Work as Court With
N. R. A.
Copvritht. 1934. bT the Associated Press.
The Government. an authoritative
source disclosed today, has forged a
new weapon to strike at monopolistic
oppression of the "little fellow" and
By a far-reaching change In pro
cedure. this source said, the Federal
Trade Commission will become a
business court 10 mete out swifter
decisions on charges of unfair prac
The new weapon. Involving a basic
change of the relations between the
commission and the N. R. A., is
contained in a technical order issued
by the commission
As this order was explained today,
the emphasis will be placed on the
commission's judicial function Hith
erto its operations have been three
fold. It investigated, made com
plaints. and then sat In judgment
on its own comDiaints.
Roosevelt Suggested Step.
President Roosevelt, It is said, sug
gested the commission and the N. R
A. get together to iron out apparent
conflicts in procedure. Out oi con
ference the new plan arose.
An explanation is contained in a
private memorandum, technical In
character. This dees not discuss the
implications of the order, but it was
said these three points are important:
1. The small business man may
appear before the commission to
argue his case If a code authority has
complained. He thereby obtains a
legal forum not previously in exist
2. Similarly the code authority
must argue its case before the com
3. The commission sits as a non
partisan judge.
The order in point was issued in
the case of three rubber concerns,
which the N. R. A. accused of violat
ing price-fixing provisions of the
May Accept Complaint.
The N. R. A. and the companies
will argue before the commission,
which may either proceed against the
companies or dismiss the N. R. A.'s
Under previous rules, the commis
sion had to make its investigation
before issuing a complaint. Now it
may accept the N. R. A.'s complaint
and let hearings determine the Jus
tice of the proceeding.
The commission is further en
abled to hand down decisions to be
gin the creation of a body of law
under which code authorities will op
The order does not alter past pro
cedure on matters not coming under
the codes. It affects only N. R. A.
The memorandum explains that
another purpose is to furnish data
regarding the N. R. A., which will
be helpful to Congress when it sets
about determining the recovery unit's
Robert Berg Unable to Give Rea
son for Attack While He Was
Eating Breakfast.
By the Associated Press.
CHICAGO. June 21.—While Robert
Berg, 24, clerk for the Home Owners'
Loan Corporation, was eating his
breakfast ham and eggs in a down
town restaurant today two gunmen
walked up to his table.
"That's him; let him have it," said
The other fired twice. Two bullets
felled Berg, one piercing his head and
the other penetrating his neck.
The assailants then ran to a small
sedan parked at the curb, with a con
federate at the wheel, and raced away.
Berg, thought at first to have been
wounded fatally, was able to give his
name to police and murmur that he
did not know the men nor why they
tried to kill him.
The restaurant where the crime oc
curred was one of the Raklioe chain,
situated at Randolph and Wells
streets in the Steuben Building.
$1,000,000 Alaskan Deal Fails.
JUNEAU, Alaska. June 21 C4">.—
The million-dollar offer of the Alaska
Juneau Mining Co for the Thane and
Perseverance properties of the Alaska
Mining-Power Co. has been turned
down by the stockholders of the lat
ter corporation.
Women Yield Lifeboat Seats
To Old Men as Ship Crashes
Four Are Drowned When German Holi
day Boat Hits Rock—Steward
Dives and Saves Several.
By the Associated Press.
KOPERVXK, Karmoy Island, Nor
way, June 21.—How women who
could swim gave up places in life
boats to elderly men was told today
by a survivor of the wreck of the
German steamship Dresden, in which
four women were drowned when it
struck a rock last night.
Other tales of heroism were brought
to shore from the vessel before it
sank in the choppy waters. One
thousand holiday-making German
Nazis were on board when it struck
in the shallow Hardanger Fjord.
The ship's band played the nation
al anthem and other sprightly
marches until the last passenger had
been lowered from the decks, the sur
vivor said.
"The second tables had about fin
ished dinner when, with a violent
jerk, passengers, tables, furniture and
dishes were hurled together on the
floor," the survivor related.
"At first there was great panic
among the struggling passengers, but
this was quieted when officers said
the commotion was caused by the
| rolling seas. But shortly the crew
; began distributing lifebelts and or
' dering everybody to the decks Then
panic broke out again.
"As lifeboats were being prepared
for launching only the firm action of
| officers and some passengers who
! helped handle the situation main
! tained order.
"The orchestra continued playing
| all the while.
"One of the stewards. Willy Bruns
(Continued on Page 2, Column 6.)
N. R. A. m BACK
Latter Threatens to Drop
Hour and Wage Terms
in Price Row.
By the Associated Press. I
N. R. A., its code abandoned by
cleaners and dyers, struck back today
with threats of reprisals—removal of
the Blue Eagle and "other steps."
Deputy Administrator Sol Rosen
blatt gave this answer to an an
nouncement by the code authority of
the cleaning and dyeing trade that it
had discarded wage and hour provi
sions. all that was left of the code.
Accusing Hugh S. Johnson of bad
faith, the Executive Committee of the
code authority wrote President Roose
velt a denunciation of N. R. A.'s
recent action In scrapping price con
trol and other fair trade practices of
the code.
"Abandonment of price control,"
the authority sail yesterday, "has re
sulted in complete demoralization of
the trade in large centers.
Racketeering Charged.
"Already evidences of vicious rack
eteering practices which had been
eliminated under the code are begin
ning to appear in different sections
of the country, and we cannot hope
to maintain stabilized conditions and
eliminate the chiseling element with
out enforcement of this all-important
Therefore, said the letter, the es
tablishments would not bind them
selves to abide by the clauses designed
to keep wages from falling and hours
from rising beyond certain levels.
Rosenblatt, in charge of the code,
countered with a statement that these
provisions were still in force: that the
code authority was in reality abol
ished by N. R. A.'s recent action.
The committee's letter, signed by
Chairman N. J Harkness of Sliver
Spring. Md„ and nine others, com
plained that Gen. Johnson had given
assurances no material changes would
be made In the code.
Charre They Were Misled.
"Under the circumstances." the
protest said, "we can only feel that
the administration knowingly and in
tentlonally deceived and misled the
(Continued on Page 2, Column 8.)
Friends and Foes See Chal
lenge in Roosevelt's
Yale Speech.
By the Associated Press.
President Roosevelt's praise of the
"brain trust" made some of his foes
see red today.
There seemed no doubt that the
men from the universities would be
headlined as an issue as the cam
paigns for the Fall elections rise to
a crescendo.
Supporters, reading the speech In
which the President accepted a de
gree from Yale yesterday, found be
tween the lines a challenge.
"Bring on that Issue!" It seemed
to them to say.
The path the new deal Is taking
promised also to furnish powder for
the big campaign guns on both sides.
Mills Scores New Deal.
A few hours after the President's
New Haven speech. Ogden Mills
spoke in New York, hitting the new
deal with the declaration that "a
planned economy is surrender."
Judging from the comebacks here
today. Republicans plan to pose the
question: "How brainy is that trust?"
"It will be one of the outstanding
topics of the coming campaign," de
clared Senator Dickinson, Republican,
of Iowa. "We are all for brains
when they are leading us In the right
direction, but against them when
they take us the wrong way."
"I suppose the President's idea,"
commented Senator Lewis, Democrat,
of Illinois, "that the 'new democracy'
will do all It can to encourage young
college men to come into politics
and Government; and, if consistent
with their conscience, to come into
the 'new democracy.' "
The significance of his last re
mark was not lost, what with both
parties out to corral young voters
for the Fall election.
Advisors of the President kept their
own counsel. Not receptive to inter
views. Dr. Rexford Guy Tugwell was
standing with Prof. Raymond Moley
on the position that there isn't any
"brain trust" any more.
It was during the 1932 campaign
that they and Prof. A. A. Berle were
principals of the group close to Mr.
(Continued on Page 2, Column I.)
Washington has a crime wave.
And the ever alert police are In
Search for burglars, murderers, sec
ond-story workers, confidence artists,
bootleggers and gamblers must wait.
A more important type of criminal
is at large.
A newspaper photographer took a
ride to No. 6 police station last mid
The photographer, who Is an adult,
broke down and confessed that he
lit a firecracker, but Insisted it was
probably the world's smallest fire
cracker, not more than an inch long,
i Inspired by the example of some
Juveniles in the vicinity, the photo
grapher lit the firecracker and hurled
it from him with gleeful whoop.
The moment he chose for the cele
bration, however, was unfortunate.
It exactly coincided with the ap
pearance of a patrolman. The photo
grapher found himself collared In the
well-known manner—belted is a bet
ter word.
The patrolman rang for the wagon,
and the ride followed. It was no fr*
ride. He had to poet $10 collated1,
though he insisted the firecra^*<r
only went "PF-F-F-FT."
"BOOM" was the way the fonct
man described it. „
At any rate th« "crinV wave
seems well In hand.
Action, Taken on Request of
House Members, Follows
r 7
Two Lines.
Acceptance of Favors in Form of
Car Discounts and "Parties"
Is Charged.
The Department of Justice has
launched an investigation of charges
made before a House committee that
certain War Department officials ac
cepted favors from firms doing busi
ness with the Army, in alleged vio
lation of Federal bribery laws.
The inquiry, it developed today, is
proceeding along two separate lines
at the request of two subcommittees
of the House Military Affairs Com
mittee. One has to do with auto
mobile purchases and the other with
the leasing of an old Army base.
Chairman Rogers of the subcom
mittee which is demanding removal
of the Army air chief, Maj. Gen.
Benjamin D. Foulols, disclosed today
that the Division of Investigation of
the Justice Department is looking into
the "Holabird situation," at the com
mittee's request.
Base Leasing Probed.
At the same time, at the suggestion
of Chairman McSwain of the military
affairs group. Attorney General Cum
mings has named a special assistant
to review evidence of alleged collusion
in connection with the leasing by
the Mercur Corporation, terminal
firm, of the former Army base at
Port Newark, N. J.
The "Holibird situation," Rogers
explained, involves allegations that
Army officers accepted unlawful favors
from motor manufacturers bidding
for Army motor truck and automobile
contracts. Camp Holabird is the
Army's testing ground for motor
Harry B Fleharty, special assistant
to the Attorney General, is studying
testimony before McSwain's commit
tee to the effect that high Army of
ficers had enjoyed choice seats at
world series base ball games and at
New York night clubs and other
amusements at the expense of the
Mercur Corporation.
The Justice Department, It was
said at the Caoitol, is endeavoring to
learn if any Federal laws were vio
lated by Government officials, with
a view to launching criminal pro
ceedings if the findings warrant.
Car Discounts Alleged.
Members of Rogers' Committee re
cently asserted that testimony showed
certain Army officers received dis
counts on automobiles purchased for
their own use. Committee members
are of the opinion this was "grossly
improper" and they asked the Jus
tice Department to determine if the
practice constituted a law violation.
The Department of Justice is mak
ing no investigation of plane pro
curement methods of Gen. Foulois,
Rogers said. The committee, he said,
was diytisfled merely with Foulois'
admini^ration of Air Corps policies
and belie\es he should be removed
| from the corps for alleged "dishon
esty" and "incompetence." The "dis
honesty" allegation, he pointed out,
had reference solely to Foulois' state
ments to the committee.
Foulois Prepare! Answer.
Gen. Foulois today was preparing
his answer to the committee's
charges, contained in a report sub
mitted to Secretary of War Dern.
The latter forwarded the report to
the air chief for "comment." Foulois
in a public statement already li» de
nied all charges against him and
has offered to meet his accusers in
The Port Newark lease project is
said to have been brought to the at
tention of Justice officials at the
time of the grand jury inquiry into
charges of illegal lobbying betore the
War Department. This inquiry ended
with no indictments, but with a
special report to the President and
Secretary Dern condemning lobbying
conditions allegedly existing at the
War Department.
The former base, consisting of
dock and warehousing facilities at
Port Newark, bougnt by the Govern
ment from Newark for $11,000,000,
was leased to the Mercur Corpora
tion under an agreement that the
corporation would pay the War De
partment $1 a year and 95 per cent
of the profits from the warehousing
No Profits Reported.
The committee was advised by wit
nesses that the Government has re
ceived only (1 a year because the
corporation caimed there were no net
profits. Offlcials said that reve*1^'
exceeding *4.000.000 were col}ect£
by the corporation, but
and "maintenance" had eateo "P
sum. M
In a report on the pro^Tfraud
Swain subcommittee .v..
and collusion." and d«*2^nearlv
among the "expens**" o( Armv
*25.000 lor entertaWW^f f~,f hTii
gfmes5 »nd °th"
Secretary of War.
I0™" ^weport alleged that pre
ii estimates Indicated that lm
e*penditures totaling about
had been made out of the
* jja* from the base and that this
jjL,« eventually might run much
SP*- ^
Berlin Names Moscow Envoy.
BERLIN, June 21 (JP).—Count Fred
eric von der Schulenburg. German
minister to Bucharest since 1931.
today was named ambassador to Mos
cow, succeeding Adolf Nadolny. An
official announcement emphasized that
there would be no change In the Ger
man policy toward the Soviet Union.

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