Site Ed. Note: The front page reports that Britain had
determined to oppose the Soviet-American plan for partition of
Palestine, which provided for Britain to leave Palestine by May 1,
1948 and to administer the country in the meantime after the
partition into Jewish and Arab states, to become effective January
1. Britain renounced support of the plan on the basis that it would
not be party to any plan by which it would be responsible for
application of force to achieve and enforce partition and thus would
not be prepared to contribute substantially to the plan or
single-handedly carry it out.
Assistant Secretary of the Navy Gordon Gray, of
Winston-Salem, said in a speech in Philadelphia to the Military
Government Association and the Military Order of Foreign Wars that a
self-supporting Germany would be less of a threat to world peace
than one starving and desperate. He said that under the contemplated
industrial recovery as part of the Marshall Plan, Germany would no
longer have war-making capability. Its allocation of steel would be
sufficient only for peacetime production purposes. Having a
self-sustaining nation would alleviate the drain on American aid. A
healthy Germany was considered sine qua non to recovery of
Europe. While the original goal of obtaining a favorable balance of
trade for Germany had been 1949, it was now estimated that it would
be at least 1952 before it could be achieved.
The Senate War Investigating subcommittee, chaired by Senator
Homer Ferguson of Michigan, investigating the war contracts of
Howard Hughes, now, according to the chairman, was going to begin
investigation of what the Army Air Forces had done to uncover and
expose possible fraud in procurement practices during the war. The
intention had developed out of the testimony of Mr. Hughes and Maj.
General Bennett Meyers regarding the conflict on whether General
Meyers was offered or sought a $200,000 loan while he negotiated the
Hughes contracts on the Spruce Goose and F-11 reconnaissance plane,
and the General's testimony that he had made $90,000 from a four
million dollar investment in war bonds, with the blessings of
Federal Reserve chairman Marriner Eccles and Secretary of the
Treasury Henry Morgenthau, the latter having informally denied
providing such advice, calling it a lie.
French author Andre Gide received the Nobel Prize for
Literature. He was described by his translator as a Communist
against Stalin and a Christian against the Church. In 1933, he had
provided a funeral oration for Russian writer Maxim Gorky in Red
Square.
In Southeastern New England, a winter blizzard, with winds
gusting to 80 mph, had taken two lives and caused a million dollars
worth of damage. Much of Cape Cod was without electrical power.
In Cleveland, the Young Democrats met in convention and would
hear from four war-veteran Congressmen, including George Smathers of
Florida. The President had sent a message the previous evening.
Former Vice-President Henry Wallace, having been denied use
of an auditorium at the University of Cincinnati, stated that he
would not hold a street meeting or speak elsewhere on the campus, as
he initially indicated he might, electing instead to speak at the
Music Hall this night. Mr. Wallace said that he respected the
reality that university administrations had to respond to the
desires of boards of trustees to keep the minds of their students
"pure". But he also said that one day the students of the
country would reach the political maturity of those in Europe and
Latin America instead of the "rather sheltered existence"
they now enjoyed.
In Newark, N.J., fireboats were ordered by the Mayor to block
entry to the Harbor by the New Mexico, a ship now owned by a
private salvage company, for wrecking in the Navy Shipyard.
Negotiations with the Navy were underway and a compromise appeared
in the offing. Newark officials wanted no more salvaging of ships to
take place in the Harbor. Meanwhile, New Mexico officials were
reportedly upset from having its namesake blocked from entering the
Harbor.
In Atlantic City, Walter Reuther won an impressive victory
for re-election as president of UAW, and his lieutenants had
captured the four top offices in the union, appeared certain to
obtain a majority for the first time of the union's executive board.
They had run on a campaign of eliminating Communist influence from
the CIO.
In Williamsburg, Va., a missing seventeen-year old
Westhampton College student and daughter of the vice-president of
General Foods was found working as a waitress in a coffee shop. She
had been missing since November 5. She could not remember her own
name or anything else. Friends ascribed the lapse to a head injury
received in an automobile accident in 1946. She had complained
recently of severe headaches and told associates that she planned to
leave school and return home.
The State Utilities Commission in Raleigh had notified
Charlotte that it would be given a chance later to be heard in
hearings on telephone rate increases proposed by Southern Bell,
increasing the rate commensurate with the density of population in
the area of service by the company.
Congressman Hamilton Jones of Charlotte informed that the
Second Assistant Postmaster General had told him, in response to his
inquiry about slow-boat airmail, as slow as regular mail in reaching
the two Carolinas from New York, that the current airmail service
was as sound as could be had under present operating conditions. Nonetheless, in an effort to increase efficiency,
the Post Office had implemented certain new schemes for delivery of
airmail to the Carolinas. Airmail was
two cents more than the three-cent regular mail.
In Charlotte, actress Anne Jeffreys, native of Goldsboro,
crowned Miss Christmas as part of the Christmas Festival activities
in the city the previous day and night.
If you have wondered why it was that Charlotte was
celebrating Christmas two weeks before Thanksgiving, your guess is
as good as ours, except that it probably had something to do with
rampant inflation and flagging consumer sales. We are certain,
however, that Miss Christmas, as part of her duties, accompanying
Santa Claus down every chimney on Christmas Eve and morn, would
considerably improve morale. For she plainly had the right ho-ho, as
demonstrated by the photograph, able to slip through the aperture with ease and aplomb.
On the editorial page, "What America Has to Fear"
responds to a Louisville Courier-Journal editorial which
found that a Gallup poll showed 53 percent of Americans fearing a
war in the ensuing decade, compared to 39 percent in Holland and 35
percent in France. The Courier-Journal editorialist found the
chief fear to be of Russia, and then went on to explain why that
fear was not well-grounded in reality, based on the fact that the
smaller land mass and population of the U.S. was nevertheless
uninfringed directly by the late war, and the country's possession
of 60 percent of the world's gold supply and exclusive resort to the
atomic bomb. America had allies throughout the world, Russia only a
small number of satellites congregated around its borders. The
American coalition could check the Soviet-bloc nations at the U.N.
The country held the lead in resources and in a reliable system of
government. The editorialist had concluded that such irrational
fears of Russia helped the Communist cause and undermined democracy.
The piece agrees, reminds that the only thing America had to
fear was fear itself.
"Gambling in the American Way" tells of the
likelihood that the special session of Congress would present an
emergency aid and inflation-control plan which would entail little
regimentation, would certainly be sans price control, wage control,
or rationing at the consumer level. Credit controls might be
restored and some extension of rent control, set to expire March
1—thus rendering useless the only advantage in tenants having
formed a lease through 1948, which had allowed the landlord,
pursuant to the last rent-control extension measure, a contingent 15
percent rent increase, thus a bad political move for the Republicans.
Some restrictions on commodity speculation were also a possibility.
The primary change would be in export controls, which would
not be noticed by the consumer, as the chief impact would be
vis-a-vis Latin America, Australia, and Canada. The U.S.
would feel a pinch in steel, coal, wheat, fertilizer and industrial
equipment, being funneled to Europe, but the Congress was determined
not to impose allocations and rationing.
The result would be a system which continued to encourage
inflation while giving aid to Europe. It counted on the vicissitudes
of weather to provide adequate crops, that private industry and
farms would be able to make up the difference in increased exports
and provide for both foreign deliveries and domestic consumption.
The Republicans also appeared bent on providing a tax cut at the
beginning of the 1948 session, twice vetoed and sustained in June
and July, 1947.
America was going to gamble and seek to have things both
ways, without sacrifice, should, that is, Senator Taft and his
followers have their way.
"Strange Noise on Telephone" tells of Southern Bell
Telephone proposing to raise its rates statewide, higher in more
populated areas where demand was more for telephone service. The
rate increase would be 50 cents per month in Charlotte and 25 cents
in the County. The City Manager had brought the matter before the
City Council for public hearings. The piece thinks it would be
revelatory of why Southern Bell appeared to stand traditional
economic theory, that prices go down as demand rises, on its head.
But it also wonders why it had taken until the eve of State
Utilities Commission hearings in Raleigh for the City Manager to
bring the matter up before the City Council, finds that there was
some interference somewhere on the telephone lines.
A piece from the Asheville Citizen, "Point for
the Smokies", tells of an editorial in the Waynesville
Mountaineer which quoted the director of the National Park
Service, from Haywood, reporting that the Great Smokies Park led the
nation in visitors for the previous year, with 1.2 million. He also
pointed out that facilities in the park system, especially
campgrounds and roads, lagged behind the increasing strain put on
the parks by growing numbers of visitors. He favored expenditure of
a hundred million dollars in the coming years for improvements.
The piece agrees with the Mountaineer and hopes the
Congress would so act. The popularity was demonstrated by the number
of visitors.
Drew Pearson tells from the "Friendship Train",
heading to New York from Los Angeles collecting food for Europe, of
the effort by the whiskey distillers to promote among newspaper
editors the idea of ending the 60-day moratorium on production of
whiskey to save grain. They were claiming that the President had
double-crossed them. They were then planning to try to railroad
through Congress a bill to end the moratorium, voluntary in the
first instance.
The confidential memorandum they were circulating, which Mr.
Pearson had obtained, told of the industry consuming 100 million
bushels of grain per year, the amount necessary to fill the grain
deficit for Europe. They also claimed that utilizing the grain in
distilling did not destroy its nutrient value as feed for livestock,
a defiance of simple fact, as distilling consumed 65 percent of the
grain's nutrient value, leaving ash, fiber, and protein,
constituting only 30 percent of the feed's content.
Moreover, the distillers had a three-year supply on hand and
were making record profits.
New Mexico was receiving seven million dollars in Federal
relief annually, but most of it was going to voting whites, not the
non-voting Navajo Indians. The Government had warned the State that
it would either need distribute the funds to everyone in need,
including the Navajo, or be cut off from the aid completely. The
State changed its policy.
Republicans were pointing out that new Secretary of Defense,
James Forrestal, had been investigated in the mid-Thirties for
gaining a huge tax advantage by setting up a trust. His banking
firm, Dillon, Read, also had been exposed for making bad loans to
Germany and Latin America. In consequence, FDR had set up the SEC to
patrol the securities and exchange markets, and had won in 1936
largely on his campaign to curb Wall Street. The Republicans, who
had nothing against Mr. Forrestal, believed it time to point out
that the sins of Wall Street were not exclusively the province of
Republicans.
French Ambassador Henri Bonnet, aboard the "Friendship
Train", had once been a school teacher before fighting in the
infantry in World War I and winning the Croix de Guerre, returned
from war determined to do something to avoid it in the future,
joined the League of Nations Secretariat where he worked until 1940.
He then escaped to England as the fall of France to Hitler took
place that June, becoming part of the government-in-exile. General
De Gaulle, head of that Government, appointed M. Bonnet Ambassador
to the U.S. after liberation in 1944. He knew the Midwest well and
so was familiar with it when he spoke from the train at Omaha.
The Congressional Quarterlytells of supporters
of universal military training, led by the American Legion,
beginning an intensive campaign to get the Congress to pass the
program by mid-winter. Lobbyists for the program estimated that a
little over a third of the Congress favored it, a little over a
third opposed, the rest still being undecided. They believed that
world events would determine in the ensuing two months how the
program fared.
Another group supporting UMT was the newly formed National
Security Committee, comprised of 63 veterans, church, educational,
and citizens groups, headed by retired Supreme Court Justice Owen
Roberts—who had chaired the Pearl Harbor investigation in 1942.
More than 200 organizations opposed UMT, but none of the
larger ones gave it the same emphasis as the Legion. The American
Friends Committee on National Legislation, the National Council
Against Conscription, and the National Council for the Prevention of
War were the most vocal opponents. The AFL and CIO, as well as farm
groups and the Amvets also opposed it. Some religious groups favored
it and some opposed.
In the Senate, Senator Taft led the opposition, while
Administration Democrats favored it, as did the President and
Governors Thomas Dewey and Earl Warren—the latter duo ultimately to
comprise the GOP ticket in 1948. Generals MacArthur and Eisenhower
also favored it.
Many Republican Senators were preparing a National Readiness Plan
to be submitted probably as a substitute for UMT, stressing
industrial preparedness for war, to accelerate mobilization if
needed.
It provides a table of the country's military strength at the
time, a total of 3.8 million military personnel. Recruiting drives
were taking place in all the branches. Planning for increase in
reserve strengths was underway. But the primary modality for
increasing military strength was UMT.
It provides the substance of the bill on UMT, to apply to all
physically eligible men between 18 and 20, to mandate six months of
military training, after which one of ten alternative programs could
be selected by the trainee, including another six months of
training, voluntary enlistment in the armed forces or the National
Guard or one of the Reserve units.
The cost of UMT was estimated at 1.75 million dollars per
year.
Stewart Alsop discusses the President's urging of Congress to
pass new measures to control inflation during the upcoming special
session, to begin the next Monday. He had spoken firmly of the
proposal when he called for the special session two weeks earlier,
but at the time had no idea what kind of measures he was seeking and
still did not. Nor did his advisers, principal among whom were Clark
Clifford, John Steelman, Dr. Edwin Nourse of the Council of Economic
Advisers, Agriculture Secretary Clinton Anderson, Interior Secretary
Julius Krug, Secretary of Commerce Averell Harriman, and their
advisers, still in disagreement over what kind of measures to
propose. They were convinced that it would be useless to try to
resurrect OPA, as it would take too long to put in place again the
bureaucratic machinery necessary for it to run, having lain moribund
for a year.
It was agreed that export, allocation, and credit controls
were essential. Some of the experts, primarily Mr. Anderson and Mr.
Steelman, favored some price control, especially on meat, wheat and
steel. But it was also conventional wisdom that the country could no
more remain a little under price control than that a woman could be
a little pregnant.
But the proponents argued that a few goods and raw materials
could now be regulated in a civilian economy, in contrast to the war
economy under which OPA had operated. Without the controls, they
argued, the bad winter wheat crop would, along with the mounting
cost of living, continue to push upward the prices of these
commodities, essential for the recovery of Europe.
Some argued that proposing price control could split open the
fragile foreign-policy coalition in Congress between Democrats and Republicans and
thereby jeopardize the Marshall Plan. The proponents argued that if
the Republicans refused such a request, then the Administration
could blame them for inflation in the 1948 campaign.
The President's message to Congress on Monday would reveal
his decision. It would be several months, however, before the wisdom
of the decision would become apparent.
Samuel Grafton states that the Marshall Plan was lend-lease
dressed up in a bit of new garb, and if the latter had not been so
abruptly terminated at the end of the war, the problems
necessitating the Marshall Plan would have been attenuated. The
special session was actually designed to correct, therefore, a huge
Administration mistake made in the late summer of 1945.
Yet, there had been practically no opposition to the
termination at the time. The President, new at the game of executive
responsibility and acquiring cooperation of Congress, had been
trying to placate the Republican opposition and conservative
Democrats when he made the move to give a clear signal that the war
was over. The country was relieved, especially those who trumpeted
"common sense" as the ultimate arbiter of wisdom.
But common sense was not so useful when dealing with the
complex machinery of multiple economies trying to recover from
wartime devastation and readjust to peacetime production. And the
country did not even save all of its money in ending the program, as
it had to give the lion's share of funding for UNRRA, a 3.75 billion
dollar loan to Britain, and aid to the Continent in the form of
supplies.
Common sense, however, wanted no sense of continuity to
embarrass the proponents of termination of lend-lease. But, he
suggests, it was important to realize that nothing really new was
coming up as business at the special session, just determination of
a remedy to an enduring problem. The session would in fact be a
"mourners' bench".
