On Chance of Passing
Excess Profits Levy
By th* Associated Press
A top administration leader said
today the Senate is likely to add
a $3 billion-plus corporation excess
profits tax to the $5 billion tax
But Chairman George of the
Senate Finance Committee told
newsmen he does not agree. Sen
ate tax debate—set to begin to
morrow—may be a slam-bang af
In a late move that may attract
new support Senator O’Mahoney,
Democrat, of Wyoming softened
his excess-profits proposal to make
the top tax 85 per cent, instead
of 100, on highest corporation
earnings that exceed “normal”
O Mahoney Explains Aim.
His aim. he said, was “to remove
any danger that the excess profits
tax might adversely affect the
Incentives to produce.”
He would make the tax effec
tive last July 1.
If the excess profits levy car
ries, the bill is expected to yield
$8.5 billion or more a year, in
stead of the $5 billion President
A bill substantially in line with
Mr. Truman’s recommendations
was approved unanimously yes
terday by the Senate Finance
Committee, and goes to the Senate
floor with bipartisan backing. It
would put about $3 billion of new
taxes on individual incomes, an
other $1.5 billion on corporations,
and would gather other millions
by plugging tax law loopholes.
Pinned to Present Bill.
Along with his softening of the
proposed excess-profits rates, Sen
ator O’Mahoney predicted again
that the levy would be pinned
to the $5 billion bill, as a means
of preventing “profiteering.”
But Senator George has said the
bill will pass without an excess
profits tax “or there will be no bifi
at all.” He said an excess profits
levy can be enacted later, effective
January 1, 1951.
He told reporters he does not
want to be a party to hasty action
that might wreck some businesses.
Mr. Truman also has suggested it
might be better to act later on an
excess profits levy.
A top administration leader,
who asked that his name not be
used, told newsmen he believes
the O’Mahoney proposal, or some
thing like it, will pass now. He
said the Senate might be swept by
the same psychology that moved it
to vote broader economc controls
than the President asked.
Some Want Limits.
Some Senators are saying that
If prices and wages are to be con
trolled, then profits should be
Under his new proposal, Senator
O’Mahoney would define as “nor
mal profits” 75 per cent of a cor
poration’s average earfttngs in the
years 1947-1949, plus $25,000 (it
would be plus $50,000 if the cor
U. N. Mediator Fails
To End Kashmir Dispute
ty lh« Associated Press
KARACHI. Pakistan, Aug. 23.
—U. N. Mediator Sir Owen Dixon
said yesterday his efforts to end
the dispute between India and
Pakistan over Kashmir have end
ed in stalemate.
Just before leaving for London
en route to report to the U. N.
Security Council, he said in a
1,500-word statement that he felt
there was nothing more he could
do to end the dispute.
Kashmir is divided between oc
cupying troops of the two coun
tries holding their lines under a
y. N. cease-fire 'order. There
have been no open conflicts since
the end of 1948, according to
Korea War Sergeant
Gets Arlington Rites
Infantry Sergt. Ernest K. Tur
ner, 35, of Berwick. Pa., was to
be buried today in Arlington Na
tional Cemetery, the first enlisted
casualty of the Korean war to
rest in that cemetery.
For the historic occasion, the
military prepared a ceremony of
full honors. Among officials sched
uled to attend were Secretary of
the Army Pace, Gen. Wade H.
Haislip, Army vice chief of staff;
Maj. Gen. Thomas W. Herren,
commanding officer of the Mili
tary District of Washington; Sen
ators Martin, Republican, and
Myers, Democrat, of Pennsylvania,
and Sae Sun Kim, Charge d’Af
faires of the Korean Embassy.
Several members of 8ergt.
Turner’s family also were to at
tend, as were delegations from
Pennsylvania veterans’ groups.
Sergt. Turner, an Army veteran
of eight years, was woqpded in
action in Korea July 24 and
four days later in a Tokyo hos
He also saw 256 days of combat
in World War H with the 142d
Infantry, 36th Division. His dec
orations include the Soldiers’
Medal, Silver Star, Bronze Star
and Presidential Unit Citation.
A brother, Staff Sergt. Day G.
Turner, was awarded posthumous
ly the Medal of Honor, highest
military award for bravery, while
serving with the 80th Division in
Europe during World War II. An
other brother, Robert, was wound
ed in action in World War n.
poration commenced business after
September 1, 1945).
Then he would apply a tax of 65
per cent on profits between 1 and
15 per cent above the base period;
plus 75 per cent on profits between
15 and 25 per cent above the base,
and plus 85 per cent of profits
more than 25 per cent above the
During World War n the ex
cess profits rate was 85.5 per cent
on cojpoartion income above the
average of 1936-1939. Some cor
porations’ taxes were determined
on the basis of invested capital.
Cost of Living Reaches
2-Year Peak, but Food
Shows Slight Decline
By Malcolm Lamborne, Jr.
Government economists, faced
with the highest cost-of-living
index in nearly two years, today
were , banking on continuation ol
a seasonal decline in many food
items to offset soaring prices in
other consumer goods.
They based their optimism on
a downward trend noted between
mid-July and mid-August.
During July, however, the Na
tion’s cost of living increased 1.4
per cent over mid-June to the
highest level in nearly two years
Sharp increases, many of them
after the lighting began in Korea
June 25, in prices of meats and
fresh fruits and vegetables were
blamed for a July 15 price index
of 172.5 per cent of the 1935-1939
level. It was the highest since
GM Workers Get Increase.
For 335,000 General Motors
workers, last night’s price re
port means a 5-cent hourly wage
increase. The company, under its
wage contract, raises the hourly
rate or lowers it, depending on
per centage point change in the
consumer price index.
A GM spokesman said another
76,000 salaried employes would re
ceive ah additional $25 each for
the next three months starting
September 1. At the same time he
said the company contemplates no
Walter P. Reuther, president
of the UAW, termed GM’s deci
sion not to raise prices “encourag
In a telegram to President Tru
man and congressional leaders
demanding anti-inflationary con
trols, he said the GM decision
“clearly demonstrates that cur
rent profit margins are sufficiently
high . . "
Mr. Reuther urged that Con
gress clamp on price controls and
an excess profit tax “to protect
the living standards of the people
from inflation and profiteering.”
Further Increases Seen.
Warning that retail prices would
rise still more, he declared:
“Inflationary price grabs are
weakening the American economy
at a time when its strength and
stability are crucial.”
“General Motors workers and
their union are not being deceived
by the 5 cents increase.” he said.
“It will be paid in the wooden
nickels of inflation and will not
enable GM workers to buy any
more of the necessities of life for
themselves and their families.”
The report of the Bureau of
Labor Statistics recalled that food
prices on July 31 were slightly
lower on the average than the
July 15 prices.
Then, it added that a prelimi
nary tabulation of prices made
last week indicates retail food
prices declined slightly from mid
July to mid-August.
One economist said he would
not be surprised If price increases
recently in such items as apparel
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__ __ _ Clesad Saturdays During August
t V 11 i L" iU
Another 11 Try Channel Swim;
Belgian Planning Round Trip
By th* Associated Press
DOVER, England, Aug. 23.—
Two more swimmers beaded
across the English Channel in op
posite directions-r-just a few hours
after seven men and two women
churned their way through the
strait in a mass crossing.
Two other Britain-bound mara
thoners—Frenchman Georges Al
fonsi and Dutchman Joseph van
Waal—gave up less than half
way to their goal.
The England-to-France swim
mer was 18-year-old Philip Mick
man, English swimmer, who took
off at 7:45 a.m. (2:45 a.m. EDT)
from just west of Dover Harbor
to try for his second Channel
conquest and his first crossing in
He began his try exactly a year
from the time he conquered the
France-to-England route in 23
hours and 48 minutes.
Others of today’s starters be
gan at Cap Gris Nez, France.
One of them—the Belgian, Fer
nand du Moulin—was so confi
dent he planned to swim back
again after a 15-minute rest.
Moulin, who crossed last year
in 21 hours, 48 minutes, tossed
off a bottle of champagne and
entered the water at 2:36 a.m.
(9:36 p.m. EDT yesterday).
and housefumishings would be
offset by lower food prices indi
cated since mid-July.
Washington’s cost of living was
not checked between mid-June
and mid-July. However, the
agency released figures showing
food prices in that period had ad
vanced 1.4 per cent, also to the
highest point since October, 1948.
BLS said meat, poultry and fish
prices here rose 1.9 per cent; eggs,
up 12.6 per cent: coffee, up 5.3 per
cent: fats and oils, up 3 per cent:
fresh fruits and vegetables, up
3.9 per cent, and cereals and bak
ery products, up three-tenths of
1 per cent.
Nationally, BLS gave these fig
ures for the 30-day period ending
Food prices, up 2.6 per cent to
He was preceded by Alfonsi, 36
year-old oil refinery engineer, and
An atack of appendicitis ended
Alfonsi’s attempt one hour after
he started. He was pulled out of
the water with a rope and was
still doubled up in pain when he
was brought back to his hotel at
Scene Vastly Different.
The scene on the French beach
this morning was vastly different
from yesterday, when 24 swim
mers set out in a race won in
record time by 41-year-old Has
san Abd-el Rehim, 217-pound
Egyptian strongman. There were
only a few spectators and report
ers on the beach.
Rehim won yesterday's race
with a closing spurt that over
took Roger Le Morvan of France
just off the English shore. Rehim s
time for the swim was 10 hours
The old record of 11 hours 5
minutes was set by Georges
Michel of France in 1926.
Both Rehim and the first wom
an to finish—Eileen Fenton, 21
year-old English school teacher—
won prizes of $2,800 each, given
by the London Daily Mail, which
sponsored the race.
a point where they are 44 per
cent higher than fn June, 1946;
clothing, down two-tenths of 1
per cent; housefumishings, up
six-tenths of 1 per cent; fuel,
electricity and refrigeration, up
six-tenths of 1 per cent; residen
tial rents, four-tenths of 1 per
cent, and miscellaneous goods and
services, up six-tenths of 1 per
Meanwhile, the Agriculture De
partment predicted wholesale
prices to farmers for all milk will
rise seasonally throughout the
rest of this year.
Its monthly dairy report said
this will result primarily from
higher fat content of milk, an
increased proportion of milk used
in class 1 outlets, and scheduled
increases in prices of milk for
Burma Claims Capture
Of Key Rebel Town
By the Associated Press
RANGOON, Burma, Aug. 23.—
The Burmese government an
nounced yesterday its naval units
recaptured the river town Mya
Gyi, seat of the Rebel Karen
government in the rice-growing
Irrawaddy Delta. It lies 85 miles
southwest of Rangoon.
A communique added that
naval units attacked two nearby
Karen strongholds where fierce
fighting tbrought heavy losses to
the Karen tribesmen.
New England caught nearly a
billion pounds of commercial fish
in >949. i
Hook Quits Claims Post
As Senate Denies Approval
ly the Associated Prats
Frank E. Hook, former House
member from Michigan, yesterday
resigned the Federal job to which
the Senate had refused to confirm:
him—member of the Motor Car
riers Claims Commission.
Mr. Hook had served on the
commission under a recess ap
pointment made October 27, 1949,
by President Truman. Mr. Hook
said he could not afford to work
He was one of four men the
Senate recently refused in a
single day to confirm for jobs
to which Mr. Truman had named
Myrna Loy's Divorce
From Markey Granted
■y th« Associated Pratt
MEXICO CITY. Aug. 23,
Myrna Loy’s attorney said yeste
day her divorce from Produo
Gene Markey has been grant*
Francisco Lopez Figueroa sa
Judge Alfonso Roquini signed tl
decree August 15 on the groun*
of mental cruelty. The laws *
Morelos State permit either pari
to a non-contested divorce to fli
suit immediately on arrival an
then leave. In this case, bot
Miss Loy and Markey named at
tomeys to act as their legal rep
resentatives before the court.
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