The Lethbridge Herald (Newspaper) - January 22, 1974, Lethbridge, Alberta
2 LETHBRIDOE HERALD TuMday, January 22, 1t74 News In brief Hijacked aircraft in Cuba Free franc may spark monetary free-for-all HAVANA (Reuter) A hi- jacked Colombian airliner landed in Cuba today but there was no immediate word on the whereabouts of 20 hostages aboard or the fate of the reported lone hijacker. The plane was surrounded by police and interior ministry officials. Reporters were denied access to the landing area and were not permitted sight of the aircraft. The plane, a four-engined Viscount turbo-prop owned by the Colombian domestic air- line Aerooesca, was seized over southern Colombia Monday with 45 passengers and five crew members on board. It refuelled in the south- western city of Cali, where the hijacker, apparently a lone 25-year-old Ecuadorean left winger, allowed 26 women and children and four men to disembark. By H. J. MAIDENBERG New York Service NEW YQJJK The decision to float the French franc in the currency markets points up the nationalistic hurdles that still confront Europeans, as well as the early effects of the energy crisis. And that decision, made in Paris last Saturday, also confronts the United States and other western economic frontrunners with some dangerous potholes. Basically, what President Georges Pompidou on France did was to let the franc sink or swim in the money market, rather than use more foreign exchange reserves to sop up francs that are being dumped by both Frenchmen and foreigners. The French franc has been falling because of soaring fuel oil prices and the attendant inflation, so have other Euro- pean currencies, but French reserves were smaller in comparison to the trading volume. Last summer, for example, it took 3.8 francs to buy a dollar; last Friday the rate was 5.18. At the rate import costs are rising, most of France's 15 billion of gold and foreign reserves would have vanished by the end of 1974. Thus, as President Pompidou saw it he had little choice. The French have traditionally mis- trusted paper money, often with good reason, and believe in hoarding valuables such as gold against the all-to-frequent im- providential acts of domestic and foreign leaders. Those facts of French life help explain why the price of gold rose to a record an ounce in Paris last Friday, or almost above the London and Zurich levels. By floating the franc, the French have also, in effect, told their neighbors that it is every man for himself. Thus West Ger- many is freed of moral, if not monetary, obligations to use its reserves to support the mark and do whatever else it can to spur exports, now that the French 'have gone it alone. Bonn's monetary reserves are four or five times greater than France's, but the German people are as terrified of the specter of inflation as the French are about losing their gold. By holding onto their reserves, the Germans hope to use it as a bulwark against inflation. If the French action signals the start of a monetary free-for-all in Western Europe and Japan, the United States could low whatever trading advantages it obtained from the devaluations of the dollar in 1971 and 1972. "It is a most dangerous one leading monetary authority said today. "We may be back to square one." If, as expected, West Germany, Belgium, The Netherlands and Luxem- bourg follow France's suit and abandon their efforts to support weakening curren- cies with reserves, then their exports will tend to become cheaper and more com- petitive here. And, obviously, any decline in the values of those currencies serve to strengthen the dollar and make American exports dearer to foreign buyers. Laundry patrons faint EDMONTON (CP) A woman and child were treated and released from hospital Monday night after apparent- ly being overcome by carbon monoxide fumes at a coin laundry. Police said the fumes were apparently generated by a defective hot water heater. Other customers in the laundry at the time were said to have complained of sore eyes and nausea. Spanish terrorists warned MADRID (AP) Interior Minister Jose Garcia Hernan- dez, who took office following the assassination of Premier Luis Carrero Blanco, says the Spanish government is going to crack down hard on terrorism. "We are agreed to act with full severity so that these out- breaks of subversion dis- the minister was as saying in the Catholic newspaper quoted Roman Ya. "The difficulties in destroy- ing them come not so much from internal problems as from the external protection they have received and are still he said. The government says that guerrillas in the northern Spanish Basque provinces use France as a sanctuary. Prince tries surfing BRISBANE, Australia (AP) Prince Charles went surf- ing today on the Australian coast and drew compliments from the way he handled the waves. "He showed he is quite a said one spec- tator. The prince had borrow- ed a surfboard for the outing at Mooloolaba, 70 miles north of Brisbane. Prince Charles is commu- nications officer on the Royal Navy frigate Jupiter, which sails Wednesday from Brisbane for Christchurch, New Zealand. He will meet his mother, the Queen, and other members of the Royal Family in New Zealand at the Com- monwealth Games. New Zealand cuts fuel use WELLINGTON (AP) -The New Zealand government to- day ordered the closure of gasoline stations from noon Saturday to 7 a.m. Monday and strict enforcement of a 50- mile-an-hour speed limit. Prime Minister Norman Kirk said New Zealanders have already achieved a nirie- per-cent saving in fuel, but pleasure driving will be prohibited on alternate Sun- day afternoons if the saving isn't increased to 15 per cent. He said that gasoline ra- tioning will be ordered as a last resort. Truckers plan petition WASHINGTON (AP) A small group of independent truck drivers says it hopes to avert a United States-wide shutdown of the trucking in- dustry by "exercising the democratic process" of petitioning for redress of grievances. Julie continues defence NEW YORK (AP) Julie Nixon Eisenhower says her fa- ther should resign as presi- dent "if he is involved in Watergate and has been lying to the American people." But she says "he hasn't done anything wrong." Mrs. Eisenhower made the comments in an interview published in the February issue of McCall's magazine. The article also quotes her husband, David Eisenhower, as saying that Julie's current spate of public appearances, interviews and other ac- tivities in defence of her father has led to occasional strains in their marriage. "She has a tendency to take things too much to he said. "And, given the very ex- traordinary pressure the family is under now, we oc- casionally quarrel." Food prices may rise 10% TORONTO (CP) A 10- percent increase in food prices is expected in 1974, C.G.E. Steele, president of the Grocery Products Manufac- turers of Canada, said Mon- day. In a statement, Mr. Steele said this increase would be an improvement over the 14.6 per cent recorded in 1973. Do You Have PROBLEMS taking GOOD PICTURES? skowymi how! GERRY oTtUNDY KWIKKOLOR Pttorw 327-4M4 limi li, l BRIDOERUQ DRAPIS LTD. Wtmm UMHI Geologists seeking assurance Stars of Ottawa performance Provincial premiers in Ottawa for the federal-provincial energy conference posed for a group picture with Prime Minister Trudeau and Governor-General Jules Leger at Government House Monday evening. From the left are: Allan Blakeney of Saskatchewan, CALGARY (CP) The Canadian Society of Petroleum Geologists has urg- ed delegates to the energy conference in Ottawa to en- sure that oil company profits and reinvestment incentives are sufficient to keep the Canadian petroleum industry viable. In a telegram to Prime Minister Pierre Trudeau, Energy Minister Donald Mac- donald and the premiers of the 10 provinces, the society says it is concerned that "the im- petus of oil and gas explora- tion and development remain strong." Declining production from existing petroleum fields must be offset by develop- ment of new fields and oil sands plants, the society says. "It is therefore essential that investment in the oil and gas industry be maintained at a high level if a shortage in domestic supply in the 1980s is to be avoided." Any recession in the oil in- dustry would endanger the Canadian economy and any shortfall in petroleums supplies would eventually cause widespread unemploy- ment in parts of Canada. L. i. Thc society says that Gerald Regan of Nova Scotia, Robert Bourassa of Quebec, Mr. although it is not concerned Trudeau, Mr. Leger, Bill Davis of Ontario, Peter Lougheed of about profits to oil company Alberta, Frank Moores of Newfoundland' and Alex Campbell of Prince Edward Island. ment remain strong. Canada 'in good position9 to continue growth in '74 VANCOUVER (CP) Al- though the impact of higher oil prices on Canada's supply of petroleum products may not turn out to be severe, we are exposed to the effects of increases in world prices, says Gerald K. Bouey, gover- nor of the Bank of Canada In a speech, which was re- leased in advance of delivery Monday night to the Van- couver Board of Trade, he added that the new price structure also creates the potential for "large shifts in the regional and sectoral pattern of income" and spending flows in this country's economy. "The world petroleum situ- ation also seems likely to affect Canada in other ways, mainly as a result of its more severe impact on the balance- of-payments positions, and Farmers who fled cloud claiming compensation He said the over-all inflation rate will be about seven per cent in 1974 compared with 7.6 per cent last year. Mr. Steele added food prices have levelled off in recent months and the recent pres- sures on the consumer price index have come from housing, transportation and clothing. Deaths By THE CANADIAN PRESS Washington John Putnam Shaw, 50, a United States for- eign service officer specializ- ing in Soviet affairs who was a member of the U.S. negotiating team in the first phase of the Strategic Arms Limitation Talks with the Soviet Union, of a heart at- tack. London Edmund Blonden, 77, English poet, critic, and professor of poetry at Oxford University from 1966 to Grosse Pointe, Mich. Ross Corbit, 74, retired president of Hiram Walker Inc. CAMROSE (CP) Farmers in the New Norway area near here agreed Mon- day they will take no im- mediate legal action against Sun Oil Ltd over late compen- sation payments resulting from an Oct. 2 blow-out of a natural gas well in the area. About 90 farmers asked dur- ing a meeting that a represen- tative of Sun Oil be sent to New Norway to deal with compensation claims. Kennedy boy may sometime be able to ski NEW YORK (AP) Edward M. Kennedy Jr. even- tually will be able to play touch football and even ski, says a rehabilitation specialist. Kennedy, son of the Demo- cratic senator from Massachusetts, had his right leg amputated above the knee in November because of bone cancer. Dr. Donald Cavalt, associate director of the In- stitute for Rehabilitation Medicine at the New York University Medical Centre, is quoted in the Ladies' Home Journal as telling Senator Kennedy: "After a period of training he will be a young boy .Tbeli again, to ski. ilicie he will be able George Calvin, a National Farmers' Union official who helped organize the meeting, said legal action may be con- sidered later if compensation is not provided. "We have to take this thing one step at a said Mr. Calvin, who said he has received no action from the company on a claim filed about a month ago. "I know people who put in claims more than two months ago and still haven't heard said Mr. Calvin. About 35 farmers Monday put their names on a list of claims yet to be submitted and more will be collected in surrounding communities, .said Mr. Calvin. Most of the claims were ex- pected to be nominal, cover- ing hotel, restaurant and other expenses resulting from a 24- hour mass evacuation of the area, about 50 miles southeast of Edmonton, after the well blew. The Energy Resources Conservation Board has ab- solved Sun Oil from blame in the gas leak, which occurred when a device to prevent blow-outs failed to work as a company crew was attempting to reopen an old well. Initially, it was believed the gas spewed out large concentrations of deadly hydrogen sulphide gas but it was established at the hearing later that water vapor and non-lethal concentrations of the gas formed the large cloud that covered the area perhaps also on the levels of economic activity, of some of our trading partners. "Nevertheless, 'Canada ap- pears to be in a better position than most countries so far as its prospects for continuing growth during 1974 are con- cerned." POLICY CHANGE Mr. Bouey said the federal bank, since early last year, has followed a policy that is less conducive to high money and credit rates than it follow- ed in 1971 and 1972. The main reason for this change was that a strongly ex- pansionary monetary policy was no longer appropriate. "By the spring of 1973, it was becoming increasingly clear that, for the immediate future, the level of over-all de- mand in Canada was more likely to be too high than too low. "The subsequent course of monetary and financial developments in Canada has reflected both the continued strength of the economic situation and this change in the posture of monetary policy." He said rapid spending growth last year was reflected in an unusually large increase in the level of economic activ- ity. "A remarkably rapid surge of growth last winter was followed by six months or so of relatively slow growth, ow- ing in part to limitations on productive capacity and to the effects of strikes, but there seems to have been a strong rebound of activity in the clos- ing months of the year. "If one takes the year as a whole, the total physical volume of output o! the economy was close to seven per cent higher in 1973 than in 1972. This was a higher rate of growth than in any year since the mid-1960s, and well above the annual average of five to 5.4 per cent that we can ex- pect to achieve over the longer run." This, Mr. Bouey said, was accompanied by the largest increase in employment since the per cent com- pared with the previous record of 4 2 per cent set in 1966. Oil sands development proposal 'still open9 OTTAWA (CP) The CBC says the federal govern- ment has rejected a "no strings attached" offer from Japan to develop the Athabasca oil sands in Alberta. The network says Ross Campbell, Canada's am- bassador to Japan, flew to Ottawa last week with the offer of the loan from a Japanese consortium, to be is- sued at the rate of billion a year for four years. The CBC says the offer was initially to be made directly to Alberta's Premier Peter Lougheed but instead was presented to the federal government where it was scuttled by the ministries of energy, mines and resources and finance. South Viets forecast move south by China SAIGON (AP) The South Vietnamese government said today the Chinese naval force that drove Vietnamese forces from the Paracel Islands last weekend may be preparing to head for the Spratly chain far- ther south. United States sources, how- ever, said they have no in- dication that the force is mov- ing south. Observers in Taiwan also doubt such a move will be made. The Spratly archipelago is 270 miles from the South Viet- namese coast in the South China Sea and about the same distance from the Philippines and Malaysian Borneo. It is claimed by South Vietnam, China, Taiwan, the Philip- pines, Malaysia and Singapore. Informed sources said South Vietnam recently established an outpost in the Spratlys, which like the Paracels con- sist of uninhabited coral reefs and atolls. But also like the Paracels, there may be oil there. South Vietnam sent a note today to the members of the Paris conference on Vietnam, protesting the Chinese move into the Paracels. The confer- ence, which agreed last March to guarantee the Viet- nam peace accords and the territorial integrity of Viet- nam, includes the United States, the Soviet Union and China. In Washington, the Pen- tagon denied reports from of- ficial South Vietnamese sources that the U.S. govern- ment provided reconnaissance flights over the Paracels for the Saigon government, and also refused two requests from the Saigon government for help in rescuing its forces from the Chinese. The South Vietnamese sources said the request was made in Da Nang and perhaps never got past U.S. Ambassador Graham Martin in Saigon. Shortage HELENA, Mont. (AP) The Montana Co-operative ex- tension service estimates de- mand for fertilizer in Montana will approach tons, or about 50 per cent more than the supply. And the service says the price may be twice as high as it was last year. The shortage resulted from increased de- mand and raising of restric- tions on acreage which will be planted. TRIM CAR RATES HARTFORD (AP) Aetna Life and Casualty Insurance Co. will reduce auto insurance rates for car-pool participants sharing driving chores with at least two others. Workers who group together to ride three to 10 miles, or three to 15 miles in some states, will be eligible for up to 13 per cent reduction in liability, comprehensive and collision premiums, Mid Frazier P. Shipps, senior vice- president. Russians protest expulsion MOSCOW (Reuter) The Soviet Union has issued a strong protest to China over the detention and expulsion of five of its Peking embassy personnel and accused the Chinese authorities of using threats and violence. In a protest note Monday to the Chinese embassy here, the Soviet foreign ministry called on China to prevent a further deterioration in relations following the worst incident between the two Communist rivals since the armed border clashes in 1969. The expulsion Saturday of the diplomats, their wives and a "a carefully staged hostile act to the the note said. It said two of those arrested were threatened with being shot and the two women were told they would never see their children again unless they gave the necessary infor- mation. The Chinese alleged the five were involved in espionage. Foreign Communist sources said a young Chinese diplomat here has been declared per- sona non grata, also on spy charges, in apparent retalia- tion for the treatment of the Russians last week. The sources said Kuan Hengkuang, Chinese embassy attache, was detained in the Siberian city of Irkutsk Satur- day shortly after the Russians were expelled from Peking. Kuan was travelling home by train after finishing a six-year spell in Moscow, the sources said. The Soviet foreign ministry informed the Chinese am- bassador here of the decision to expel Kuan, the sources said. The Soviet protest note, handed to Ambassador Liu Hsin-chuang, said there is no doubt that Peking needed "a new anti-Soviet provocation to justify the course of hostility to the Soviet Union and to give a new impetus to the anti- Soviet chauvinistic cam- paign." It described the incident as "barbaric" and a "crying violation" of international law.