Cedar Rapids Gazette, February 1, 1974

Cedar Rapids Gazette

February 01, 1974

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Issue date: Friday, February 1, 1974

Pages available: 52

Previous edition: Thursday, January 31, 1974

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Cedar Rapids Gazette (Newspaper) - February 1, 1974, Cedar Rapids, Iowa Weather- Cloudy, warmer through Saturday. Oc- casional light snow. High Saturday in 20s. 15 to 20. CITY FINAL 10 CENTS CEDAR KAl'lOS, IOWA, FlilDAV, FEBRUARY I, 1974 ASiOCiATKi) PRESS, UH, NEW YORK TIMES Percent Out of Job WASHINGTON (AP) With the fuel shortage tightening its economic grip, the nation's em- ployment rate rose from 4.8 per- cent to 5.2 percent in January, the biggest monthly increase in four years, the government: Friday. The labor department blamed actual or anticipated shortages of gasoline and other petroleum products for a substantial loss of jobs last month in the avia- tion, automobile and recreation industries. Nearly workers lost their jobs, raising total unem- ployment in the nation to a seasonally adjusted 4.7 million. This pushed the jobless rate over five percent for the first time since last May. To Worsen Administration economists predict the job situation will continue to worsen this year due to the fuel situation and general economic downturn. The White House has estimated the rale will climb to about six percent but a number of private econo- mists believe it could' go to seven or eight percent, depend- ing on how long the fuel short- age lasts. January's increase in the job- less rate was the largest since January 1970 when it rose from 3.5 to 3.9 percent. Unemployment was at a. 20- year low of 3.3 percent when! President took office in January, 1969. It began a steady! rise in 1970 and hovered around the 6 percent mark for 19 months before beginning to de- cline in June, 1972. Joblessness bottomed out at 4.6 percent last October. Fuel Impact The bureau said that while the loss of jobs to the fuel shortage was substantial it was unable to give precise figures as to just how many jobs were lost to shortages of fuel and how many were due to the economic slow- down that began even before the Arab oil shutoff heightened the energy crisis. However, in a separate re- port, the labor department said that of 2.5 million persons re- ceiving unemployment ance benefits for the week (Continued Page 3, Col. 8) Nixon Voices Call for Patience on Economy WASHINGTON (AP) Amer-1 year'as economic output dips to leans will be pounded by power fully rising prices and increas ing joblessness until the econ omy takes a mid-year turn foi the better, President Nixon': annual economic report saic Friday. Conceding the economy i caught in the worst inflationar. spiral in a generation, Nixon urged patience by consumers "To correct a powerful trend o the economy which has been going on for some time requires lie said in a message to congress. The grim, but somewhal hedged, outlook by his three- man Council of Economic Ad visers: A C percent rise in con sumer prices in 1974, comparereak the back of the energy crisis this year because we're going to continue to experience ,hese very high prices" as a result of actions taken by petro- eum exporters. "I think what the Prasidt-n! was saying was that we're going to get started with the Sawhill said. "But to say we're (Continued Page 3, Col. 4) Mansfield Reply To Nixon Tonight WASHINGTON (AP) Sen- ale Democratic Leader Mike Mansfield delivers his party's official response to President Nixon's Stale of the Union speech tonight. Mansfield plans to speak for about 15 minutes and then an- swer questions from radio and television newsmen. The 50-minutc program will be carried live p.m. CDT by CBS, NBC and ABC television. near-recession levels, the coun- cil said. Nixon expressed frustration over dealing with the nation's many economic problems. Bui he said the American people arc better off than they think. "Compared with our parents and grandparents we are enor- mously he said. "We have protections against the ebbs and flows of economic life Stocks Drop NEW YORK (AP) Stocks were sharply lower Friday as Wall Street reacted with pes- simism to administration pre- dictions on the economy, brokers said. At 2 p.m., the Dow Jones average was down 11.30 to 844.25 while declining New York Slock Exchange issues led gainers 3 to 1. that they never expected anc barely imagined. But I cannol assure the American people o! an easy time." He reaffirmed his faith in free economy and said the sys- tem of wage-price controls he established in 1971 to corral in- flation would continue to be phased out. When, he didn't say. The lengthy economic reporl also scooped the President's budget message, scheduled to go to congress Monday. II showed the budget for fisca 1975 will total billion, with a deficit of billion. Spending Rise Defense spending will rise about to-a record level Nixon said the budget will im- pose moderate economic re- straint, because the total spend- ing does not surpass the reve- nues that would be brought in iy the government in a time of high prosperity. He promised to step, in and increase federal spending if nec- essary to keep the unemploy- ment rate from going too high as a result of the energy crisis. But what the economy now needs, after two years of up- heaval, is a "greater steadiness of he said. The council raised the specter of international economic reces- sion if the industrialized nations fail to deal with spiraling oil prices properly. Nixon said worldwide recession can be avoided with international coop- :ration. Price Rise Consumers can expect food and fuel prices to rise sharply jetwcen now and mid-year, Council Chairman Herbert Stein said. After the sharp increases in he cost of living have run their course, the rise should slow to an annual rale of about 4.5 per- cent in (he second half of the 'ear, the report said. This still would be higher than he 3.4 percent inflation rates recorded in 1971 and 1972. It's been a hard fight and t's going to be a hard fight for long Stein said of the nflalion problem. He said there ire "no instant solutions." Nixon outlined this strategy or dealing with Ihe nation's (Continued Page 3. Col 2) Date Set TRUCK DRIVERS John Olson of Indianapolis and Harold Elwood of Stockton, Calif., look at a paper calling for drivers in Los Angeles to jump the gun on the trucker strike. Drivers there began the stop- page some six hours early when they blockaded the terminal with their rigs. Gazette Leased Wires U.S. judge issued a tempo- rary restraining order against the head of the Council of In- dependent Truckers Friday as a nation'wide .work stoppage by in- dependent drivers grew. Dozens of shooting incidents and reports of thousands of drivers participating in the pro- test against high fuel prices were reported. In Tennessee, police reported fired at trucks. One driver suf- fered minor injuries. Police.in Pennsylvania, Ken- tucky, Alabama and Tennessee Iruckers who were ignoring calls for a shutdown. In Alaba- ma, troopers said a large'gaso- line tanker was hit by three small caliber bullets bill the driver was not hurt. They said the tank was punctured and leaked gasoline. Bars Interference In Cleveland, U.S. District Court Judge Leroy Contie issued a temporary restraining order on behalf of the National Steel Carriers Assn. against George some 15 incidents of shots being Rynn, president of the Council of Independent Truckers and others. It bars them from interfering with steel carrier association reported shots being fired at members and bans use of citi- ;en band radios to further what Prices of Raw Farm Products in 9% Jump WASHINGTON Prices of raw farm products jumpec percent from mid-Decem- 3er 'to mid-January, including another big rise for wheat to a record per bushel, the U.S agriculture department (USDA) said Thursday. The farm price index rose 1.5 icrcenl from November to De- cember after declining for three consecutive months. The index lad soared lo a record love! asl August. Wheat averaged. per lushel in early December and vas in January 1973. In- creases were triggered by big export sales to the Soviet Union 8 months ago but have risen nost rapidly since last summer. The Crop Reporting Board said higher prices for cattle, ration, hogs, corn, potatoes and calves also contributed (o the December-January in- crease. Fuel Pinch Old Hot to Albany Couple ALBANY, N.Y. (AP) The rest of the nation is just catch- ing up willi Joseph Navilia and his wife. For them, Ihe energy crisis began more than three years ago. Since 1970, the Navilias have lived in their suburban home without clectrictiy. The doorbell doesn't ring, (Pholo on Picture the television set Is useless, (inly kerosene lights brli'hlen (lift living room mill Ihe family I'olics on a porlnblo null" for much of Its entertainment. In IliB summer of 1970, the slain clodded lo widen Wolf road in front of the Navilia home and Ihe Niagara Mo- hawk Power Corp. moved all power lines underground. The utility said customers who wauled lo continue with electricity would have to hire a contractor to connect their houses with Ihe main road cable, Navilia said. He re- fused. "Kor 25 years we always paid our Mrs. Navilia said. "And we didn't, Ihink we should have lo pay for a cable." "Bui you know where Ihe power added her hus- band, "My bill was n month. That's a lot, but they can afford (o forget about me and hook up a big motel. Big companies if they don't get you one way, they get you another." Now, Ihe roadside vegetable stand (he couple has operated for 30 years is dark. Mrs. Navilia cooks on a gas stove nnd lakes licv laundry to a laundromat. Refrigerator "One problem was the re- she said. "We li'ied using a cmnping box, filling il witli blocks of Ice, but Ihcy'd melt almost soon as 1 bought them." So she buys food each day at a nearby supermarket. The couple's gas furnace works but not the two extra electric healers. Navilia said they once rcnl- ed an apartment behind (he house but the tenants moved after the clcclricily was shut off. Despite Ihe inconvenience, loss of rent money and lack of regular business since he slopped lighting Ihe vegetable stand, Navilia says ho does not regret Iheir decision. "Noi. one bit 1 he said. 'I resent being steam- rolled by Niagara Mohawk. And to protest this Is Ihe only weapon I have." Perhaps most important in the near future for consumers was a 12 percent increase from Dec. 15 in the meat animal in- dex. Compared with mid-January a year earlier, these prices av- eraged 21 percent higher. Meat products make up about 32 per- cent of a family's food spend- ing. Family spending for cereal products, including baked goods accounts for 15 percent of the food budget on the average, ac- cording to USDA. Advances in livestock prices point to January food prices breaking the August record when new statistics are avail- able in a few weeks. Cattle averaged ?44 per 100 pounds of live weight in mid- January, up from 37.60 in De- cember. The peak, for all kinds of beef cattle, was last August. In January 1973, they were per 100'pounds. USDA Friday said farmers in 1973 had a record net in- come of billion, up from the previous high of bil- lion in 1972. The net' income was derived from record cash receipts total- ing billion for products sold by farmers last year. In 1972 receipts totaled bil- lon. In addition, government pay- ments in 1973 including sub- sidies for taking cropland out of iroduclion totaled bil- ion. That was down from a billion in 1972 and the owcst since 1965, when Ihe pay- ncnls were billion. The government has removed icreagc restrictions for 1974 Ji'ops of wheat, cotton and feed jrains and officials expect Ihe mymcnls lo farmers will drop o prac'lk'allv nothing tills year. association called a con- spiracy to interfere. The suit asked for million damages a day. A hearing was set for Feb. 7. Reports of drivers joining the shutdown came from more than 20 states, mostly in the East, South, Appalachia and the Mid- west. There were scattered re- ports of parked rigs in Califor- nia and Arizona. Some truckers not joining the stoppage traveled in packs, spending the night in motels, awaiting the arrival of safer daylight hours. Near Allentown, Pa., a motel clerk said a number of drivers had taken "They're afraid to go out on the he said. Calling Guard Some plants announcec a y o f f s, others said the; couldn't stay in business mucl onger and Pennsylvania Gov Hilton Shapp prepared to cal out the national guard to hal :he violence that claimed one ife in his state Thursday. One New Jersey refinery kepi its gasoline trucks parked as pickets marched outside. State police patrolled high- ways in some Appalachian states. Union drivers not honor- ing the shutdown call travelet in groups of threes and fours in other areas. On one Virginia highway early Friday groups of trucks slaved down at bridges and intersections, looking for nails and other obstacles which caused some drivers to head home. Reports received from truck stops in several states were thai rigs had blocked the fuel lanes "1 just told the drivers to pull in front of my pumps and block said Don King, a truck stop manager in Fenton, Mo "These guys are my bread and liullcr and whatever they want, I'll go along with them." Feeling Impact Businesses dependent on trucking were beginning (o feel the impact of Ihe action, which started last week in Ohio and Pennsylvania but did not begin Today's Index Comics .................-..18 Courthouse ..................3 Crossword Daily Record ...............3 Deaths ......................3 Editorial Features...........C Farm ......................14 Financial Marlon .....................19 Movies .....................10 Society Sports ..-................15-17 Slate Television ..................13 Want Ads................22-25 spreading much further unti Thursday. General Motors said the strike could force it to close all 21 of its plantsvin.Oiio next week, throwing close to employes out of work. A few small firms in Ohio anc West Virginia announced layoff Thursday. Bethlehem Steel said truckinj it its Bethlehem, Pa., plant wai at a standstill and a meetin] was to be held today to discus, a layoff. The plant employs persons. Some Midwest meat packing plants said they may soon fee the pinch. A dozen major coal mines in Appalachia were said to be run- (Continued Page 3, Col. 7) By Frank Nye DBS MOINES Protesting all the way at being "black- mailed" into it, the Iowa house inally bowed, to the inevitable 'riday and voted, 83 to 10, to idopt the 55 mph energy crisis peed limit imposed by ongress. The 55 rnph limit will go into iffect on all Iowa highways March 1, if the state senate ac- cepts house amendments. It will last until June 30, 1975, unless the President declares an end to the crisis earlier. The 55 mph restriction re- places present daytime limits of 75 on interstate highways, 70 on primary highways and 60 or less on other roads. License Revocations Before passing the bill (SF1013) .the house adopted an amendment to repeal the law which now makes it mandatory for the state public safety de- partment to revoke drivers' li- censes of persons convicted three times in one year of speeding charges. The senate passed the bill, 38 to 8, on Jan. 17, during this ses- sion's first week, and the house took it up the'next day. l But when it ran into a mael- strom of objections from members who declared "we SAO PAULO, Brazil (AP) Fire swept through the upper floors of a 25-story bank build- ing Friday and at least 60 people were killed. Many office workers jumped to their deaths. At least 25 persons on the roof waved frantically to circling helicopters as flames and smoke rose from the floors below. Because of the heat and smoke, the helicopters were un- able to land on the building until nearly two hours after the fire started. Then they took turns landing and carrying away sur- vivors. what to it was made a special order ioi' debate Friday. What thej objected, to was the "blackjack" or "black- mail" provision that states falling to adopt the 55 mph limit by March 3 would lose their federal highway funds. 1 1 w a s variously estimated during the debate that this would mean a loss of million to Iowa. There nerer was any question that the legislature would pass the bill, once congress threat- end lo take away funds and once Gov. Robert Ray recom- mended the 55 mph limit in his Jan. 14 message to the legisla- ure. Even so, reluctant house members weren't about to let it >ass without letting the world mow they don't appreciate the eds applying a headlock on the >tate through fund-threatening. Stock Answer Various attempts to change he bill ran into a stock ar- [ument from its floor manager, ?ep. Richard Drake (R-Musca- ine) that Iowa would lose its ederal highway funds if the 55 nph figure was altered. But this didn't keep objectors from offering amendments to change the figure to 60 mph and to authorize Gov. Ray to change the 55 mph limit to a figure of (Continued Page 3, Col. 5) Report: Could Scrap i i 25% of Rail Mileage WASHINGTON (UPI) The transportation department said Friday that 25 percent of the railroad mileage in 17 Norlh- iv e s t e r n and Midwestern states is uneconomical or rc- lundaut and could be abanoncd ivith only minor impact on shop- Jers or passengers. The remaining lines should be into a core system of well maintained high density 'interstate" railway lines, gath- ering traffic 'coder lines iranch lines, said. Unprofitable secondary profitable the department from and b r a n c h lines should be abandoned and rcdun- lant main lines should nilher be ibandoncd or downgraded inlo secondary linos, the report said. Indiana, Michigan, Illinois Ohio were spotlighted as he slates with the greatest imounls of "polunlinliy excess" ine more lhan wiles, each, ranging from one-quarter to one-third of each state's mile- age. The report was ordered by congress when it passed legisla- t i o n to consolidate seven bankrupt Northeastern and Mid- western railroads into one sys- tem. Although only a recommen- dation, it is expected to play a major role in the thinking of the new U.S. Railway Assn., which will plan and finance the now system over n two-year period. The report had been expected to recommend massive abandon- ments. Tndau's Clntckte Sign In n used car lot: Ca- dilliic, like new. Was driven by a doctor to make hoiwo calls. -Cwvrlohl ;