Evening star. [volume], March 30, 1938, Image 1

About Evening star. [volume] (Washington, D.C.) 1854-1972

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WEATHER.
tU. S. Weather Bureau Forecast.)
Showers tonight and tomorrow; warmer
tonight, with lowest temperature about 60
degrees; moderate winds. Temperatures
today—Highest, 62, at 2 p.m.; lowest
50. at 6:15 a.m.; 61 at 3 p.m.
Full report on page A-2.
Closing New York Markets, Page 16
The only evening paper
in Washington with the
Associated Press News
and Wirephoto Services.
Means Associated Press.
86th YEAR, No. 34,301.
WASHINGTON, D. C., WEDNESDAY, MARCH 30, 1938—FORTY-TWO PAGES.
Entered as second class matter T’TJ'OTT'ir /'ITT'VTPC!
post otBce, Washington, D. C. InilXjJj lo.
REORGANIZING BILL
DEBATE BEGINS IN
BOUSE TOMORROW
Special Committee Reports
Four Early Measures
as Amendments.
COCHRAN ASKS LIMIT
OF SIX HOURS ON TALK
Gifford and Taber Protest on
Refusal to Hold Public
Hearings Now.
BACKGROUND—
Legislation to change line-up of
government departments and agen
cies is one of Administration's
favored reform measures. Despite
bitter opposition, becoming in
tensified in last few days, Senate
leaders pushed bill through this
week, but circumstances forcing its
return to House once more jeop
ardize its enactment.
By WILL P. KENNEDY.
The special House Reorganization
Committee, by a strict party vote of
7-2, today reported* the four House
bills on reorganization as an amend
ment to the reorganization bill that
passed the Senate and voted to a^t
the House to start six-hour debate
on the bill tomorrow.
Chairman Cochran this afternoon
introduced the new composite bill
with each of the four previous House
bills being a separate title. He also
submitted the identical reports that
were made on each of these bills last
session.
The committee will ask the House
by unanimous consent to meet at 11
a.m. tomorrow, and to limit debate to
six hours. Unanimous consent also
will be asked to read the bill by title
in order to save time.
Chairman Cochran announced that
the committee agreed that no debate
on a legitimate amendment under the
5-minute rule should be shut off. The
committee itself considered no amend
ments. He said that he hopes to
have debate finished tomorrow.
Agreement is Reached.
An agreement was reached, he said,
that in the event the bill passes and
goes to conference and the provision
in the Senate bill to establish the Na
tional Resources Board is included in
the conference report, the House com
mittee pledges itself to bring the bill
back to the House for a separate vote
on the National Resources Board pro
vision, which was not Included in the
original House bills.
A demand for hearings was made
by Representatives Taber of New York
and Gifford of Massachusetts, the
Republican members of the Reorgani
zation Committee, After discussion
the committee decided not to hold
hearings. Mr. Cochran explained
that hearings had been held for 15
days before the joint committee and
the Senate held hearings for 14 days.
He also emphasized that the repre
sentative of the Civil Service Com
mission had sat with the committee
helping to perfect civil service reor
ganization provisions. In this, he said,
Mr. Tabor had offered several amend
ments which had been accepted.
Asks “Breathing Spell.”
Representative Gifford, when asked
If the minority had concurred in the
committee action, replied, "The mi
nority has to be satisfied.” I begged
with all the power and earnestness
I have for action to be delayed so
that the public mind can be eased
of its distress over this question and
be assured that it is our intention to
retain the Controller General,” he
said.
"The country is in an awful condi
tion today. All financial writers are
tying up reorganization with the
financial situation in the minds of
the country. We should have a
breathing spell,” Representative Gif
ford declared.
Mr. Gifford also protested that “the
House committee never had a single
day of public open hearings—every
thing was done in secret. Besides, the
state of the public mind is nothing
today as it was months ago. The
people are aroused and deeply con
cerned regarding reorganization. They
ought to be heard.”
Representative Taber, Republican,
of New York yesterday made a final
attempt to postpone floor debate by
asking for public hearings. Admin
istration lieutenants termed them un
necessary.
The failure of the Democrats to
invite minority members into their
conference yesterday prompted Re
publican Leader Snell to complain
wrathfully to the House about “a
purely partisan matter.” He called it
a "very unfortunate approach to such
an important problem.”
Telegraphic Protests Pour in.
Chairman Cochran replied that it
was customary for majority members
of a committee to work out strategy
for handlnig bills.
Both supporters and foes of the
administration’s broad program agreed
the House struggle would be as intense
as that in the.Senate. The thousands
of telegraphic protests which Senators
bad received were being duplicated
in the other chamber.
The Senate and House reorganiza
tion programs differ most widely in
their treatment of the General Ac
counting Office. The Senate bill would
place its functions in the Budget
Bureau. The House bill would retain
the office of controller general.
Wheeler Answers President.
The Associated Press reported that
President Roosevelt, vacationing at
Warm Springs, Ga., told reporters
yesterday that Senate approval of the
reorganization program “proves that
the Senate cannot be purchased by
organized telegrams based on direct
misrepresentation.”
Senator Wheeler, Democrat, of Mon
tana, one of the bill’s leading foes,
commented after learning of the Pres
ident’s statement:
"If there was any purchasing done,
it wasn’t by telegrams. All the as
surances that came on the bill, came
from executive departments.”
^ Ah
Pitts, Realty Man, Found
Dead Where Boy Killed Self
HARRY B. PITTS.
witch was on, but the motor was not
•unning and the gasoline tank was
hree-quarters full.
The garage door was closed, but
the rear doors of Mr. Pitts’ automo
jile were open.
At Mr. Pitts’ office here, employes
said he had worked there until about
5 o'clock last night and seemed in
;ood spirits and good health. Police
-hief J. William Garrett and Sergt.
Earl Brudine, who began an inves
tigation immediately after the body
was discovered, said no notes were
found.
An autopsy was being performed,
aowever, by Dr. E. A. A. Dunn, who
(See PITTS.’ Page~A-5J
--
President of Company
Dies of Fumes
From Car.
Montgomery County polioe this
morning found the body of Harry B.
Pitts, 48, of Chevy Chase. Md., a well
known real estate operator, seated in
his ear, parked in the same garage
where only two months ago a 17-year
old Woodrow Wilson High School ath
lete had killed himself.
Mr. Pitts, owner of the vacant house
and garage in the rear of 4856 Chevy
Chase boulevard, was dead of carbon
monoxide poisoning. He had died in
the same manner as Truman W. Cole,
17, ot 4620 Hunt avenue. Chevy Chase,
whose body was discovered in the ga-4
rage on January 24 alter the boy had
been missing for a week.
Mr. Pitts, who was president of the
Harry B. Pitts Real Estate Co., with
offices at 1019 Fifteenth street N.W.,
had been missing since last night from
his home, at 2 Blackthorn street,
Chevy Chase. He had left his house
to keep a business appointment with
Clarence J. Poland of Aurora Hills,
Va., and a salesman, Lagerson Floyd,
806 Maple avenue, Takoma Park, Md.
It was Mr. Floyd who discovered the
body of the Cole boy while preparing
to show the house to a prospective ten
ant in January.
When he learned this morning that
Mr. Pitts had not returned- home over
night. Mr. Poland notified police and
gave them a list of houses for which
the Pitts firm was agent. After a brief
search, Officers E. R. and Carroll Jones
discovered Mr. Pitts’ body on the rear
seat of his car. parked in the Chevy
Chase boulevard garage. The ignition
CANCER INJECTION
IS FATAL TO SIX;
Orlando (Fla.) Women Die of
Tetanus—Inquiry Begun
by U. S.
By the Associated Press.
ORLANDO. Fla., March 30.—Dr.
H. A. Day, president of the Orange
County Medical Association, said today
six women have died here and four
other persons have been stricken with
tetanus during the last 24 hours fol
lowing injections used in treatment of
cancer.
He said Orlando physicians feared a
number of other persons might be
stricken, since an undetermined num
ber had been given the injections.
The six women have died in Or
lando hospitals since midnight. The^r
and the four who are in a serious con
dition were stricken with tetanus
(lockjaw) yesterday. Dr. Day said
that in every case death came much
sooner than usual in tetanus cases.
Hospitals said the dead are Mrs.
Jack Sweetman, Mrs. L. J. Jackson,
Mrs. W. R. Thompson and Mrs. Eliza
beth Sunderburke. all of Orlando, and
Mrs. W. C. Braswell of Holopaw. Fla.,
and Mrs. H. B. Homage of Cocoa. Fla.
Dr. Day said every effort w>as being
made to locate all persons who had
received treatment for cancer. He de
clared the serum used in the cases
which had proved fatal came from the
office of a physician here. Most of
the injections, he said, were admin
istered Saturday.
Drug Held Contaminated.
CHICAGO, March 30 (VP).—Dr. Mor
ris Fishbein, spokesman for the Ameri
can Medical Association, said today
the compound used in cancer treat
ment at Orlando, Fla., apparently had
become "contaminated.”
Dr. Fishbein said the drug, known as
ensol, was manufactured in Kingston,
Ont., Canada, and was introduced in
September, 1935. At that time, Dr.
Fishbein said, the medical association
warned against its use as an unstand
ardized product.
He said the cases would be investi
gated by the Federal Food and Drug
Administration and the United States
Public Health service. Investigators
obtained samples of the drug for bac
teriological examination.
Dr. Fishbein said he did not expect
deaths would be widespread since the
product, because of its foreign manu
facture, would have only limited dis
tribution here.
It is administered only by a physi
cian, is not sold to the public across
the counter, and its sponsors claimed
no other uses for it than for cancer,
Dr. Fishbein said.
Cancer sufferers, Dr. Fishbein wrote
in 1935, had been "stimulated to false
hopes” by the product.
U. S. Inquiry Ordered.
The Federal Food and Drug Admin
istration ordered an investigation to
day into the deaths last night of six
persons at Orlando, Fla., which officials
said had beep attributed to a "cancer
cure” drug. '
Dr. J. J. Durrett, chief of the drug
division of the administration, said
two investigators now located in
Florida had been instructed to go to
Orlando to make the investigation.
They are M. O. Rentz and Lowrte M.
Beacham.
Dr. Durrett said the administra
tion would seize all the drug that
could be located in this country. It
is manufactured, he said, by a drug
concern at Kingston, Ontario, Canada.
The Canadian Legation here, Dur
rett said, had promised to co-operate
in every way to obtain a list of sources
to which the drug had been sent
in this country.
Dr. Durrett said he had been in
formed the drug had not been placed
on the market yet, but that samples
had been distributed among physi
cians for clinical trial.
“Whether or not this is the case,”
he said, “we will not know until we
hear from Canadian health officials
through the Canadian Legation.”
Ship Voting Booth.
MANILA, March 30 (/P).—A char
tered German ship will carry German
and Austrian residents of Manila be
yond the 3-mile limit so they can vote
in the April 10 plebiscite on Ger
many’s annexation of Austria, the
German consul general said today.
FRANCO ADVANCES
ON WIDE FRONTS
Rebels Are Within 11 Miles
of Lerida, With City’s
Fall Nearing.
BACKGROUND—
Spanish civil war, which began in
July of 1936, has been moving
rapidly toward climax in last few
tveeks. In early days of tear Gen.
Franco's Fascist rebels advanced
siciftly and then began seige of
Madrid. Government Loyalists sur
prised by defending city, and entire
cause took new hope. But grad
ually by skirmishes and many air
raids Rebels gained. .Then several
weeks ago Rebels wgan big of
fensive on Barcelona, now gov
ernment capital, in effort to end
war.
By the Associated Press.
WITH THE INSURGENTS IN
SPAIN, March 30.—One wing of In
surgent Gen. Franco's eastern army
renewed its smashing toward the
Mediterranean from the Caspe and
Alcaniz sector today while the other
hammered Catlan resistance within 11
miles of Lerida, the “gateway” to
Barcelona.
Gen. Garcia Valino’s division of
Italians and Navarrese stormed the
Sierra de Caspe and moved in the di
rection of Gandesa without resist
ance. (Dispatches from Irun quoted
insurgent officers as saying this divi
sion was only 6 miles from Maella,
which is 38 miles from the coast.)
A few miles to the south, Gen.
Miguel Aranda's army captured the
town of Palanques Heights, near Zorita
in Castellon Province.
Forty miles north of this sector, in
surgents fighting along the road to
Barcelona, widened their spearheads
before Lerida. 80 miles from the gov
ernment capital.
Occupy Important Posts.
They occupied important positions
southeast of Frasa, including Aytona
and Seros in Catalonia Province.
These towns southwest of Lerida are
Segre River Valley electric power cen
ters which supply much current for
(See SPAIN, Page A74.7
---->
Belgian Strike Threatens.
BRUSSELS, March 30 UP).—Coal
workers threatened a general strike
today, after announcement of a 5 per
cent wage cut beginning April 3.
Already 1,450 St. Vaast miners had
laid down their tools. The cabinet
was expected to seek a solution to
night.
SNELL BELABORS
Resolution Held Effort to
‘Muddy Waters’ to Bar
Intelligent Report.
PRESIDENT’S QUIZ HELD
STAR CHAMBER SESSION
If Inquiry Is So Broad Nobody
Will Ever Be Able to Get to
Bottom, He Says.
' *
BACKGROUND—
Dr. Arthur E. Morgan, deposed
chairman of Tennessee Valley Au
thority, forced a sweeping Congres
gessional investigation of that
agency by refusing to produce facts
in support of charges against co
directors at hearings arranged by
President. Although in some dis
agreement as to proper scope of in
vestigation, it is expected House
and Senate will compose differences
and authorize probe of all phases
of T. V. A.
By JOHN H. CLINE.
House Minority Leader Snell to
day assailed the Senate resolution for
Rn investigation of the Tennessee Val
ley Authority as an attempt to "muddy
the waters" so no intelligent report
can ever be made of the dissension
within the power agency.
Talcing the floor as the House be
gan debate on an amended resolution
called up by Chairman O’Connor of
the Rules Committee, Mr. Snell de
clared:
“The fundamental issue involved in
this controversy and the primary
question for investigation is whether
the directors of the T. V. A. have
honestly, intelligently and efficiently
spent the public money.
“The Senate proposal to investigate
propaganda disseminated by the pri
vate utilities opposing T. V. A. and the
recommendation that the committee
investigate any financial loss to mu
nicipalities or farm organizations
caused by preventing their purchase of
power from the T. V. A. are attempts
to muddy the waters.
“If we are going into such matters,
the investigation will be so broad in its
scope and so complex in form that no
committee will ever be able to get to
the bottom of the matter or submit an
intelligent report to Congress and the
people.”
At one point, Mr. Snell was inter
rupted by Representative Allen, Re
publican, of Illinois, who said the ma
jority of the people regard President
Roosevelt's “fact-finding" investiga
tion of T. V. A. dissension as a “star
chamber proceeding" and evidence
that the President was prejudiced
against Dr. Arthur E. Morgan, who was
removed as chairman of the T. V. A.
by Mr. Roosevelt. Representative Al
len said the demand for a congres
sional investigation is imperative.
Mr. Snell said Dr. Morgan had an
enviable reputation as an engineer be
fore he was named to the T. V. A., and
pointed out that the President’ was
unreserved in praising his character,
ability and integrity when he selected
Dr. Morgan to head the power agency.
No Precedent.
"In view of the President’s opinion
of Dr. Morgan at that time,” Mr. Snell
said, “it would seem abvious that the
charges he has made against his co
directors merit the serious attention of
Congress and demand that we made
a fu'l and complete investigation of
them.”
In calling up the amended joint res
olution, Mr. O’Connor said there was
no precedent for that form of investi
gation and that the Rules Committee
would have insisted upon subsitution
(See t7v. A, Page A-57)
150 MOROS KILLED
Philippine Soldiers Report Fifty
Strongholds Destroyed.
MANILA, March 30 UP).—Common
wealth soldiers returning today from
a four-month campaign in Lanao
Province reported more than 150Moro
outlaws were killed and 50 forts were
destroyed.
The 106 soldiers were sent to Lanao
when the regular garrison reported
it was unable to cope with a Moro out
break. At present, officers said, the
province is peaceful except for isolated
clashes between patrols and outlaws
who escaped into the jungles.
Summary of Today's Star
^age. Page.
Amusements C-4-5 Radio_C-5
Comics C-10-11 Short Story_.C-12
Editorials .. A-8 Society_B-3
Finance ... A-14 Sports_C-l-3
Lost & Found C-5 Women’s Pg. B-ll
Obituary_A-10
FOREIGN.
Cardenas, facing revolt by labor, calls
Congress. • page A-l
Rumanian cabinet of "old men” re
signs. Page A-4
Chinese and Japanese mass war ma
terials for "big push.” Page A-4
NATIONAL.
Snell assails Senate resolution for
T. V. A. probe. Page A-l
House reorganization bill debate begins
tomorrow. Page A-l
Pendergast wins in Kansas City, but
lead is cut. Page A-10
WASHINGTON AND VICINITY.
Senators favor tax exemption in “death
sentence” action. Page B-l
Early grand jury action promised in
Landis case. Page A-2
Highway Bridge improvement to result
from Jefferson Memorial. Page A-2
D. C. supply bill goes to President with
parking meter plan. Page A-3
Washington to vote April 29 on D. C.
suffrage. Page A-5
Revised estimates of business privilege
tax revenues too high. Page B-l
Official "suggestions” complicate life
in Greenbelt. Page B-l
D. C. crime probe by special House
group urged. Page B-l
Nine indicted on lottery charges as
result of raid. Page B-l
House group votes to close Military
road for airport. Page B-l
EDITORIAL AND COMMENT.
Editorials. Page A-8
This and That. Page A-8
Washington Observations. Page A-8
Answers to Questions. Page A-8
The Capital Parade. Page A-9
David Lawrence. Page A-9
Dorothy Thompson. Page A-9
Constantine Brown. Page A-9
Lemuel Parton. Page A-9
SPORTS.
Failure of Chase, Krakauskas crimps
Nationals’ plans. Page C-l
Baseball injury jinx on job ahead of
time this year. Page C-l
Colorful Cards an “if” team, but a
flag possibility. Page C-2
Terp tracksters would duplicate suc
cess of nine. Page C-2
Thomas pins hopes on landing early
against Louis. Page C-3
Prospect for Escobar title fight here
brightens. Page C-3
MISCELLANY.
Nature’s Children. Page B-5
Shipping News. Page A-6
Vital Statistics. PageA-12
City News in Brief. Page A-13
Service Orders. Page A-13
Bedtime Story. Page B-2
Letter-Out. Page C-10
Cross Word Puzzle. Page C-10
Contract Bridge. Page C-ll
ka
W&0& '
iflfOMtOCAU?
" SAFETY FOR THE THRIFTY !
CARDENAS FACING
REVOLT OF LABOR
Calls Urgent Session of
Congress After U. S. Sends
Strong Protest.
Hull Acknowledges
Mexican Rights but
Insists on Payments
By the Associated Press.
Secretary Hull formally ac
knowledged Mexico's right to ex
propriate American oil properties
today but demanded adequate
payment.
"This Government has not un
dertaken,” he said, "and does not
undertake to question the right of
the government of Mexico • • •
to expropriate properties within
its jurisdiction.
“This Government has, however,
on numerous occasions and in the
most friendly manner pointed out
that in accordance with every
principle of international law, of
comity between nations and of
equity, the properties of its na
tionals so expropriated are re
quired to be paid for by compen
sation representing fair, assured
and effective value * * *
BACKGROUND—
Expropriation of foreign oil in
dustry in which more than S400.
000.000 has been invested has cre
ated grave economic situation in
Mexico. Lacking foreign market for
oil, business in other industries has
been at standstill since March IS.
Move' resulted when 17 companies
refused to comply uHth orbital
award, sharply increasing wages.
Companies declared wage increases
were confiscatory, since revenue did
not make them possible.
By the Associated Press.
MEXICO CITY. March 30.—Presi
dent Cardenas, summoning an "ur
gent” session of Congress to help him,
was confronted today with near-revolt
by a segment of labor, and a vigorous
Uhited States protest against expro
priation of the $400,000,000 oil indus
try.
The American protest was presented
to the foreign mmistry yesterday by
Ambassador Josephus Daniels, and a
high Mexican official Indicated it was
an energetic note demanding explana
tion how Mexico intended to pay for
the 17 American and British oil prop
erties.
The indications of labor dissatisfac
tion came from Carlos Flores, labor
department inspector in Tampico and
member of the powerful union there
which controls 6,000 ex-employes ol
the Aguila (Royal Dutch Shell) Co.
The government “took advantage ol
labor-capital conflict to create inter
national political conflict” by the ex
propriation, Flores charged.
Denies Labor peace.
Asserting he spoke for other mem
bers of his union, Flores contradicted
assertions by union headquarters in
Mexico City that all was peaceful
among the workers. The Tampico
union ousted a capital-approved ad
ministrative council, demanded wage
increases and other benefits.
“We are all discontented. We were
far better off before,” Flores said.
Tampico reports said every storage
tank there was filled with oil, and there
was no place to put crude or refined oil
since the lack of foreign markets
created by expropriation of the com
panies March 17.
Asphalt, packing, shipping, marine
and other departments of all shipping
termini were closed, and nearly 3,000
part-time workers were released.
From Poza Rica came reports that
workers there were not paid Saturday
or Monday, although the oil labor
syndicate asserted “payments were
effected normally throughout the in
dustry” last week end.
A permanent commission of Con
gress was to meet late today to set a
date for the congressional session,
probably for the second 10 days in
April.
Cardenas’ request for the session
(See MEXICO, Page A-5.)
BULLETIN
HONOLULU, March 30 VP).—
Five Navy flyers were missing to
day and officials feared they were
killed in the crash of a big patrol
bombing plane at Waianae, on the
Island of Oahu. *
Weds in New York
ELIZABETH VANDENBERG
PFEIFFER,
uuuyruer uj oenaLor vanaen
berg of Michigan, who ivhs
married yesterday in New
York to Edward Pfeiffer of
that city. News of the mar
riage was revealed today by
the Senator.
(See Page B-3.)
CLASS 1 RAILROADS’
DEFICIT IS $2,136,481
February Operating Loss Is First
Since 1921—Made $38,792,779
Last Year.
By the Associated Press.
The Nation's class one railroads re
ported today an operating deficit for
February, the first since February,
1921.
The Association of American Rail
roads said a deficit of $2,136,481 was
shown by the 137 class one railroads
last month, compared with net oper
ating income of $38,729,779 in Feb
ruary, 1937.
The association said 69 class one
railroads failed to earn expenses and
taxes in the first two months of 1938.
Twenty-eight of these were in the
Eastern district, 10 in the Southern
district and 31 in the Western dis
trict.
Class one railroads are rail carriers
with gross annual revenues of $1,000,
000 or more.
For the first two months this year
class 1 railroads had a net operating
income of $4,783,395, which the asso
ciation said was at the annual rate of
return of 16-100 of 1 per cent on
their property. In the first two
months of 1937 their net operating
income was $77,659,615, or 2.58 per
cent on their property investment.
In the first two months of 1930 their
net railway operating income was
$113,013,227, or 3.79 per cent on prop
erty investment.
Sacrifices Life.
QUINCY, 111., March 30 (TP).—Gor
don Holbert, 35, a Davenport (Iowa)
crane operator, drowned in the
Mississippi River here last night when
he tried to rescue a fellow workman.
School Filled With Pupils Is
Hit—Many Taken to
Hospitals.
BULLETIN.
COLUMBUS. Kans., March 30
(/Pi.—The tornado which tore
through this town of 3.500 near
noon today twisted apart a school
and 30 other buildings and in
jured an estimated 50 persons,
many of them children. It was
one of a series which dipped into
Arkansas, Oklahoma. Missouri and
Kansas. Three were reported
killed in Boone County, Mo. A
woman was killed at Republican,
Ark.
Bj the Associated Press.
COLUMBUS, Kans., March 30 —A
tornado struck the western side of this
town of 3,500 shortly before noon to
day, severely damaging a school build
ing and injuring scores of persons.
The West Side Highland School
Building was filled with children who
were preparing to leave for lunch when
the storm struck. One survey indi
cated as many as 40 houses were dam
aged.
Columbus is located in the extreme
southeastern corner of Kansas, near
both Missouri and Oklahoma. Emer
gency calls to nearby Joplin, Mo., and
Pittsburg, Kans., summoned cars of
doctors and nurses.
Hospitals Fill Up.
Prom 30 to 35 beds in the city's two
hospitals were rapidly filled with in
jured. Only one telephone wire was
operating out of Columbus and that
was taken over by the officials and
rescue workers as an emergency line.
The tornado cut through an area
of from eight to ten blocks. The
roof of the West Side School col
lapsed while brick and mortar poured
through the second floor.
Virtually all the windows of the
community high school, in which were
750 pupils, were blown out, but it was
believed none of the high school pu
pils was injured.
Classes Just Dismissed.
The lower grades of the Highland
School had been dismissed for noon
before the tornado struck, and as
some of these have their classrooms
on the second floor, this may have
saved many lives.
The tornadic winds were accom
panied by a heavy rain and hail
stones as large as good sized mar
bles. The storm raged with great
severity for about 20 minutes. It
swept the west and north sections of
columbus, striking from the south
west.
Gandhi 111.
CALCUTTA. March 30 <£>).—Doc
tors announced today that Mohandas
K. Gandhi had suffered a “fairly bad”
breakdown in health after he attended
a conference on village education and
rural uplift at Berbhoi Orissa.
Nevertheless the former mahatma
was expected to resume discussions
shortly with the Bengal government
on release of political prisoners.
‘Singograni1 Is Latest Wrinkle
In Modern Message Sending
Djr U. AVAAIS tlUWAKil.
One never knows what to expect
over the radio when it is tuned in at
random, but the telephone, up to a
short time ago, seemed to be a little
more specific. Now, however, that has
changed. Picking up the receiver, one
may hear some one crooning "Happy
Birthday to You,” or some peculiar
greeting or advice from an entirely
unknown voice—and, what might be
embarrassing, a girl’s voice.
Don’t be worried. It’s the "singo
gram,” the latest business-getting idea
of the telegraph companies. Pick out
any popular song and the singogram
operator, whether In voice or out, sings
it to your best friend over the tele
phone. If she lives at Des Moines and
Des Moines hasn't a good singing
operator, she gets the message from
Cedar Rapids.
First of all, there appeared about
the same time with both telegraph
companies what is known as "kiddie
grams.” These messages to the chil
dren followed the Christmas, Easter,
Thanksgiving Day, birthday, Mother’s.
Day and Father’s Day greetings, which
were sent by both companies at vastly
reduced rates, regardless of what part
of the country they were intended for.
A number was used to signify the
particular thought to be expressed.
a
But numan nature is iuu oi iun
and practical jokers. The messages
that are supposed to be for children
sometimes reach adults.
Imagine your surprise (and your
wife’s) if you should receive No. 1381,
“Here is a big X and a big round O,
a kiss and a hug for one I love so!
Happy birthday.” And Junior and
Jane tucked in bed these two hours.
Or No. 1394: “Brush your teeth,
comb your hair, hurry to bed, say
your prayer, and before you know it
I will be there.”
Then there's No. 9, under engage
ments: “Never mind, old man; it
could be worse and probably will be
before long. Cheer up.”
And No. 853, children’s birthday
anniversaries: "If I were there you
wouldn’t dare to turn your little back
because, as you know, I am never slow
to hand a birthday crack.” Another
one. No. 871, “Little birdie whispered
you were being good, little birdie said
tweet-tweet. I just knew you would.”
So if an operator calls you up to
sing “Happy Birthday to You” and
says the call is from Joe Zilch, don’t
mind, unless the song is rendered
too late at night. Probably these
lines of communications have a limit
there, too.
CAPITAL GAINS TAX
TO MPT mt
SENTENCED TO DIE
Senate Committee Moves to
Protect Utility Security
Owners.
INVESTMENT TRUSTS
BLANKETED INTO BILL
Both Actions Are Taken With
Approval of S. E. C. After
Chairman Testifies.
By JOHN C. HENRY.
The Senate Finance Committee to
day exempted from taxable income
the capital gains or losses accruing
from dissolution of utility holding
companies under the so-called death
sentence.
The action would have the effect
of protecting from prohibitive taxa
tion the equity of security owners in
utility holdings, involved in changes
in corporate structure under the act
of 1936.
At the same time, the committee
blanketed into the ordinary corpora
tion tax group all investment trusts,
thus making them subject to the flat
18 per cent income tax. with credits
allowable for corporations.
Previously, investment trusts had
received preferential treatment.
Both actions were taken with ap
proval of the Securities and Exchange
Commission, whose chairman, William
O. Douglas, appeared before the com
mittee this morning.
iiueu udvlous injustice.
Although not Important particu
larly as to revenue, the decision on
the utility transfers has the effect of
correcting an obvious injustice in Gov
ernment policy and should lead to
comparatively rapid progress in the
integration of utilities as provided in
the Public Utility Holding Company
Act of 1936.
Under section 11 of this act. the
S. E. C. is directed to supervise the
simplification of the corporate set-up
of the utilities and to accomplish a
geographic integration of the system.
It is this latter task, implying the con
solidation of utility enterprises now
existent or their transfer to different
parent groups, that give rise to the
“death sentence” description.
Briefly, the job may be accomplished
through voluntary action of the com
panies or by specific direction of the
commissicar.
Under present tax law, however, the
capital gains and losses resulting from
the shifting of ownership of securities
in these utilities are subject to the or
dinary tax treatment accorded to all
capital gains and losses. The effect,
in other words, was to compel transfer
of the securities and at the same time
compel payment of heavy taxes on the
forced transfer, a condition which
Chairnran Douglas described this
morning as “too much like putting a
gun at the head of the industry.”
Second Qualification.
A second qualification specifies that
the exemption should not be effective
in case of transfers for cash—that is,
if the holder of the securities sells
them outright rather than accepting
securities of different status in the
exchange. Also the transaction be
comes a taxable one at a later date if
there is an initial transfer under sec
tion 11 and a subsequent outright
sale.
The committee was to attempt to
complete its consideration of the reve
nue bill in a second session this after
noon.
Meeting in a four-hour session last
night, the committee responded to the
leadership of Chairman Harrison,
Democrat, of Mississippi by conclu
sively voting down all “special inter
est” pressure to load the measure with
extraneous tariff provisions.
Extra Year Allowed.
Most important decision, however,
was that of liberalizing the tax re
quirements applying to liquidation of
personal holding companies. The com
mittee decided to allow them an extra
year in which to complete their liqui
dation and pay their taxes on an in
stallment basis.
By the amendment, such companies
could take three years for the process
of liquidation and those receiving the
proceeds from sale of assets could
spread their tax installments over
four years. Many of these companies,
rendered virtually useless by the 1937
law tightening avoidance loophopes,
have stood idle for the past year with
billions of dollars thus withheld from
the reinvestment market because of
the prohibitive taxes which would
have applied had they proceeded with
liquidation.
Fork Tax Excluded.
Chairman Harrison estimated last
night that from $2,000,000,000 to $4,
000,000,000 has been frozen in these
companies. Several witnesses appear
ing before the committee during the
open hearings placed the figure as
high as $6,000,000,000. Availability of
an important part of these totals in
the investment market should be of
material help in stimulating new
business, it is felt.
In its decision to exclude tariff pro
visions from the modification meas
ure, the committee was complying
with administration wishes as ex
pressed yesterday by Secretary of
State Hull and Secretary of Agricul
ture Wallace. Stricken from the
House bill was an import excise tax
of 6 cents per pound on prepared
(See TAXES, Page A-5.)
BRANDEIS IS ILL
justice Mieses Second Session of
Court—Has Cold.
Associate Justice Louis Brandeis,
who is suffering from a slight cold, re
mained away from the Supreme Court
Bench today for the second consecu
tive session.
At his home it was said the 81
year-old Justice was not confined to
bed and would have resumed his duties
today except for threatening weather.