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An In4t; 0\\\\. !e ml Weekly Newspaper 20, 1959 `%\(‘-k 10c per copy No. 11 Vol. 51 We will serve no group or party but will hew hard to the truth as we find it and the right as we see it. The one great rule of composition is to speak the truth. THOREAU The Texas Observer AUSTIN The only real hope for a compromise tax bill in the first called session disintegrated this week when a three man majority of Speaker Waggoner Carr’s House c o of er e e s voted against principles a majority of the House members had voted for. Witnesses to this evidence that the people they were negotiating with did not believe in what they had seemed to advocate, the senators in the closed sessions of the House-Senate tax conference continued to hold fast for their 75 percent sales tax bill. From that point on it was certain that the Senate bill would emerge from the conference committee, if anything did. Speaker Carr Tuesday afternoon went to Governor Price Daniel and asked him to issue a AUSTIN Comments from key figures in the legislative tax fight on the House-Senate tax report in favor of a 75 percent sales tax, 25 percent business program, which the Senate accepted 19-12 and the House rejected 121-27: Rep. George Hinson, Mineola, sponsor of Gov. Daniel’s tax bill : “It’s a wonderful issuethe three-cent cigarette tax the Senate passed in preference to a natural gas tax. AUSTIN The Observer had occasion this week to question a few of the state’s political leaders on the latest Gallup Poll on the Democratic nomination for the presidency, which showed Adlai Stevenson ahead, John Kennedy second, and Lyndon Johnson third. JAKE JACOBSEN, executive secretary of the State Democratic Executive Committee, “My three choices, in order, are Johnson, Kennedy, and Stevenson. I believe this is also the feeling of a majority of the executive committee, and, as best I can state it, the feeling of the people.” Why Stevenson third? “Because Stevenson’s lost twice. There’ve been so many bad things said about him: Everything bad that can be said about a man has been said about him, and it’s been said so many times.” JAKE PICKLE, high-level aide to Governor Price Daniel, and principal organizer for Daniel’s forces in campaign’s: “I would imagine that if Johnson announces he is a candidate or is prevailed upon to be a candidate, the delegation would be a Johnson delegation and there would be no percentage for Stevenson or Kennedy. \(As between Stevenson and sis, I would think that Kennedy statement in support of t . forthcoming report, which was to be substantially the Senate bill, not including either a token severance beneficiary tax on out-ofstate users of Texas natural gas or the Governor’s change in the franchise tax so that it would fall more heavily on interstate corporations. Daniel had earlier asked the two House conferees who represented the House majority on taxes to accept a Senate-like compromise on the strength of private assurances Daniel made to them. They told him they could not sell such a compromise to the House. Therefore, when Carr approached Daniel, the Governor told him he would not issue a statement for the give-in to the Senate. He told Carr that in order for there to be compromise, the Senate and Carr’s three-man majority on the House committee must give in on behalf of at least We can get some people beat with that.” Sen. Charles Herring, Austin, one of the Senate conferees: “I have some reservations. But I have 20,000 state employees in my district who won’t get paid if we don’t pass a tax.” \(He signed the Rep. Don Kennard, Fort Worth, one of the two House conferees who refused to sign the report and voted against it: “There was such an odor of natural gas in might be our more practical choice for the simple reason that Stevenson has been defeated twice before in Texas, and that’s a pretty hard hump to overcome.” \(Pickle also said, “The Democrats are going to win. All these people who are candidates will get behind the nominee. And I don’t think we’ll have as much difficulty in the election as beMRS. R. D. RANDOLPH of H o u s t o n, national committeewoman from Texas and chairman of the Democrats of Texas Clubs: “I’m a Stevenson woman.” She thinks most liberal Democrats in the state prefer Stevenson to Kennedy, except that she has heard of Kennedy support in ‘San Antonio. MRS. KATHLEEN VOIGT, liberal figure in San Antonio politics: She is for Stevenson, Kennedy, Hubert Humphrey, that order. Johnson “doesn’t figure.” She says the “Catholic liberals” will go for Kennedy, but “every non-Catholic liberal who is a leader in San Antonio politics is for Stevenson. I’ll take Kennedy second because I think he’s a liberal and I have satisfied myself about this Catholic thing,” Johnson can’t be nominated or elected and “Nelson Rockefeller would a token severance beneficiary gas tax and some change in the franchise tax formula. Carr noted down these two items during his conversation with Daniel. At this very time, the tax conferees were mulling over a package presented them by Reps. Don Kennard and Alonzo Jamison, the two House conferees who represented the House majority. This package, 60 percent sales taxes and 40 percent business taxes, ineluded one percent severancebeneficiary on natural gas and a change in the franchise formula. It left the Senate’s three-cent cigarette tax intact. Kennard and Jamison told the senators they would advocate this package to the House. The Senators were interested and wanted to causus. Conference With Carr Carr’s three men on the conference committee, Reps. Bo Ramsey, W. T. Oliver, and George Cook, all of whom opposed a severance-beneficiary tax and voted against the House’s half-business, half-sales tax version of the tax bill, were taken aback by the Kennard-Jamison proposal. Ramsey and Oliver went to find Carr, as they had done on frequent occasions during the 16 or 18 meetings of the conference committee. Carr at the moment was in the Governor’s office, but on his return they conferred. Carr was cross because Kennard and Jamison had proposed a package which fell between the House and Senate versions without consulting him in. advance. When the conference committee reconvened, the senators said that before they would state their position on the package, they wanted to know if the House stomp the daylights out of him, couldn’t he?” JERRY HOLLEMAN, president of Texas State AFL-CIO: “If the choice were betWeen Kennedy and Stevenson, I’m inclined to think they \(state political leadnedy. They feel, and I’m inclined to feel a little this way myself, the unfortunate losses that Stevenson has suffered give him a tremendous disadvantage.” BOB ECKHARDT, ‘Chairman, Harris County Democrats, and a state representative from Houston: He is for Stevenson because he believes Stevenson is equipped to handle the main issue confronting the nation, the foreign situation. He believes most liberal Democrats in Texas rank-andfile prefer Stevenson to Kennedy. He says “mere political competency” is “not enough” and classes Johnson and Kennedy as merely competent. ELWOOD FOUTS of Houston, founder and guiding spirit in “Freedom in Action”: “I am amazedwas the other day when I saw a record of popularity by poll showing Stevenson and Kennedy so popular. It was inclined that Lyndon Johnson wasn’t even in the picture.” Whom does he favor among the three? “I think they’re all about alike, don’t you?” 1 conferees themselves would take it. By a vote of three to two the House rejected the package, Carr’s three men. voting no, Jamison and Kennard aye. Kennard then said he wanted a vote of the House conferees on a one percent severance beneficiary gas tax. \(The House majority had same vote of three to two, the House conferees opposed the one percent severance beneficiary tax. Ramsey then took votes on the Senate’s tax provisions, and the Senate’s tax bill, with minor revisions, was presented to the Senate, which approved it, 19-12, and the House, which thunderously defeated it, 121 to 27 \(see “The and Jamison refused to sign the report and voted no with the 121. Of the 27 who voted aye, eleven are members of Carr’s 21-member tax committee in the House. All three of Carr’s men on the conference committee signed the report and voted for it. There was not much evidence that the senators would have taken the package in any case. Three separate occasions before in the closed conference committee meetings they had refused to consider the severance-beneficiary tax in any form. In fact, until Kennard presented the package, the senators, except for Charles Herring of Austin, who favors the House approach to taxes, adamantly refused to compromise on any substantial point excep the franchise tax. The other four Senate conferees were Rudolph Weinert, Seguin, who was elected chairman of the conference; Dorsey Hardeman, San Angelo; Jimmy Phillips, Angleton; and Bruce Reagan, Corpus Christi. These four stuck fast together for the Senate’s bill. Concessions Expected Thursday a week ago, the afternoon the conferees were named, the five men for the House side met with Carr in his apartment. He said he had designated them because they would AUSTIN The Senate-written tax bill rejected by the House would have provided for a one percent increase in the tax rate on. natural and temporary increases \(through tive sales taxes in the bill: car \(from five to eight cents a pack, $4.-cigars and smoking and chewing boats and boat motors \($2.6 milators’ chauffeurs’ licenses \(not direct sales tax on utilities gross receipts was booked for $3.1 million. Miscellaneous taxescuts in theater taxes of $180,000, and better special fuels enforcement for $1.2 millionbrought the bill’s Price Insists On New Gas Tax AUSTIN Governor Price Daniel told a joint session of senators a n d representatves, “You and I know that the major issue which has deadlocked this legislature has been the question of whether natural gas pipeline companies would bear a fairer, larger share of the tax burden of this state. I think they should. I am positive that a majority of the people of this state, if permitted .to vote on the issue, would favor additional taxes on those who have tied up the natural gas reserves of this state and who are transporting to other states and foreign countries 53 per cent of all marketed gas produced in Texas.” Receiving a standing ovation from the floor and the gallery when he entered the lower chamber for his address opening the second called ‘session, Daniel repeated in strengthened terms his program for solving the state’s financial troubles. “My only regret is that I did not recommend a higher tax on these pipeline companies,” Daniel said. “I see no reason to put all of the natural gas increase on Texas producers and royalty owners when there is a constitutional method available for placing it on the gas pipeline companies … Governor Shivers, one of the most conservative governors in the history of our state, recommended to the legislature in 1954 a similar tax of one half cent per thousand cubic feet.” After saying he suggested a lower figure than Shivers in the hope that gas pipeline companies would practice “business statesmaship” and accept the boost. Daniel departed from his prepared address to reflect that one gas representative told him earlier in the year that the tax was acceptable and that he felt the biggest job Daniel and Rep. George Hinson had was “to keep it from going any higher.” Hin presumed revenue to $177 million. Excluding the miscellaneous taxes, the bill was about $44 million business taxes and $130 million sales taxes, a ratio of 25 percent to 75 percent. Voting for its enactment into law on the Senate side: Baker, Colson, Dies, Fly, Hardeman, Hazlewood, Herring, Hudson, Lane, Martin, Moffett, Owen, Phillips, Ratliff, Reagan, Roberts, Secrest, Smith, Weinert. Senators voting no: Aikin, Bradshaw, Crump, Fuller, Gonzalez, Kazen, Krueger, Moore, Parkhouse, Rogers, Willis, Wood. Thus it passed the Senate 19-12. The House then rejected the report, 121 to 27 \(counting four sets that every member was recorded one way or the other except Speaker Waggoner Carr and Menton Murray, Harlingen. The 21 representatives for the bill were Allen, Bartram, Bass, Blanchard . Bowers, Bristow, Buchanan; Burkett, Cook, Cory, Ehrle, Gluging. Green, Heatly, Jarvis, Jerome Jones, Matthew, Oliver, Osborn, R a m s e y, Richardson, Roberts, Shannon, Slack, M a x Smith, Thurman, and Woolsey. All other members who voted said no to the Senate. Senate Plan Sags Under 121-27 Vote