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The Texas Observer An Independent-Liberal Weekly Newspaper A Window to the South Volume 53 TEXAS, DECEMBER 1, 1961 15c per copy Number 35 DALLAS Texas Baptists are gunning for Rep. John McCormack, successor-apparent to the late Speaker Sam Rayburn of Texas, in a sudden renewal of last year’s church-versus-state controversies. The Nov. 29 issue of “Baptist Standard,” the official organ of Texas Baptists \(circulation 366,is a Catholic first and an Americaii second. “Without equivocation,” the publication says in an editorial, “the Standard opposes . the elevation of this man to the high office of Speaker of the House. Time and again he has urged Congress to enact legislation that would send an envoy to the Vatican. He allied himself with his Roman Catholic hierarchy in the recent battle for aid to parochial education. In fact, many writers have charged him with the defeat of the President’s Aid-To-Education Bill in the last session. Drew Pearson says McCormack has so followed the dictates of the Catholic Church that President Kennedy has privately referred to him as the Bishop of Boston. HOUSTON Dr. S. M. Nabrit, president of Texas Southern University, told the Observer this week that 30 of the 65 Negro colleges now accredited by the Southern Association of Colleges will be removed from the SAC when that organization meets in Miami, Fla., next week. The schools Will lose their accreditation because they have failed to measure up to the new single standard of excellence demanded by the SAC, he said. Heretofore, the SAC, official accrediting group for all colleges and universities in the South, has had one standard for accrediting white schools, and another for accrediting Negro schools. Furthermore, while-the white schools were either in or out, with no gradation of acceptance, the Negro colleges could win acceptance on an A or B or C basis. . In other words, up to now a Ne “The President has proved that a Catholic can put the country first, but McCormack has proved already that some Catholics put it in second place,” the Standard’s editorial continued. “America does not need that kind of a man in this important post. Speaker Rayburn was a Baptist, but never at any time did he plead for the private interest of the Baptist denomination.” In a companion editorial, the Standard assails Catholics for seeking federal funds for church projects with an intensity reminiscent of the publication’s editorials during the last presidential campaign. Said this second editorial: “It is astounding how far the Romanists will go to get public money for their projects. In practically all countries where their people are predominant their schools, hospitals, and other agencies are financed with tax money. “In the United States this church has built a multitude of hospitals with government money. Her parochial school students get most all the fringe benefits accorded public school students . For several years she was able to operate a commercial winery in California without paying the customary taxes on it . . . “Reliable foreign reports say she often dispenses our surplus government foods in her own name. Every congressman knows that Senator Wayne Morse was right when he charged before the U.S. Senate that Cardinal Spellman and the Catholic hierarchy are responsible for the defeat of the Federal Aid to Education Bill. They said they would defeat it unless it provided equal funds for their parochial schools, and they have done it.” Insofar as the Baptist Standard speaks for the Baptist General Convention of Texas which owns it, Texas Baptists have declared war on the selection of John McCormack as next Speaker of the U.S. House of Representatives. gro college in the separate-butequal South had to be less than a caricature of a college before it would fail to win accreditation on some level. The move toward a single standard has been in progress for six years, Nabrit said. The 30 schools that will be bouncedschools situated from Virginia to Texas, excluding Oklahoma and Arkarisa.* have known what was coming, but could not make the needed improvements, usually for financial reasons. For these colleges, this may be the first step toward their extinction. Certainly it will be more difficult to attract students, since students cannot transfer credits from a non-accredited to an accredited college, nor can graduates of non-accredited colleges do graduate work at accredited colleges without assuming a considerable burden of “make-up” requirements. SAN ANTONIO, AUSTIN A veteran governor who is a conservative and a young legislator who is a liberal are spearheading the most vigorous campaign yet waged to bring banks under a state escheat law, but the Texas banking community has largely snubbed them. Gov. Price Daniel, who has met defeat on escheat legislation enough times to have set some kind of international record, and Franklin Spears, the San Antonio Willie Morris representative now involved in a race for Henry Gonzalez’ vacancy in the state Senate, are the principal leaders. Daniel has repeated his warning that an effective law covering banks will be at the top of the special session agenda in January. Spears is chairman of the special House Committee to Investigate the Enforcement of the Texas Escheat Laws. One hearing has already been held, another was scheduled for Friday \(after this The committee, which also includes Reps. Ted Springer of Amarillo, Paul Haring of Goliad, Reed Quilliam of Lubbock, and Dick Slack of Pecos, sent out 1,175 questionnaires to banks and savings and loan associations and received, as of mid-week, only 250 replies. Spears angrily charged that this was “a defiance of lawful authority” and promised to subpoena banker witnesses at the next hearing. The countless attempts to put dentures in the state’s abandoned property law offer a classic study in failure. Daniel has advocated such legislation ever since he became governor, and liberal Rep. Charles Hughes of Sherman has either sponsored or led floor fights for an escheat law in every session since 1953. Both on and off the floor there have been charges of “undue pressure” from local bankers. In recent sessions the voting in Nabrit’s prediction is, of course, unofficial and nothing certain can be known about what colleges will be excluded until the SAC committee on accrediting announces its verdict next , week. Nevertheless, several other educators close to the operation of SAC confirmed to the Observer that Nabrit’s estimate sounds reasonably in line with the firmer policy established by SAC. Nor is it certain what the move will mean to Texas colleges. Nabrit says Texas Southern, Prairie View A&M, Huston-Tillotson College in Austin, and Wiley College in Marshall will be accredited. There are eight other Negro colleges in Texas, five of which are now accredited. Nabrit said the Texas situation is unusual in that its public Negro colleges are best supported and findaccreditation easiest to win, whereas generally elsewhere the House has been extremely close. Several versions of Hughes’ billrequiring banks, savings and loan associations, insurance and oil and gas companies holding dormant accounts for seven years or more to report them to the state, which in turn would make every effort to find the owner or his heirs before filing suits to get the money for the statewere slapped down in the last legislature. Then, in the first called session this summer, Hughes decided he did not have the votes to pass a bill which covered banks. A watered-down measure covering dormant accounts held by everyone except banks and savings and loan associations was introduced, passing House and Senate and being reluctantly signed into law by Daniel. Spears Daniel Texas law has long provided for the escheat of property to the state upon the death of an owner without heirs. In the absence of statutory provisions under which the state could take and use unclaimed accounts, however, the law has been purely academic. Bankers have persistently argued that the proposal would violate the law of contracts, damage the relationship of banker and depositor, and do injury to the prestige of the banking community. When a person opens an account in a bank, they have . said, he should have the right to come back anytime, years later, and find his money still there. Dewey Lawrence, counsel for the Texas Bankers Assn., stated clearly the bankers’ view in hearings earlier this year: “We be in the South it is the private Negro college that maintains the higher standards. He said that not until one gets to North Carolina does one find the state supporting its Negro colleges in the style found in Texas. Nabrit praised the establishment of the one-standard accreditation, indicated some of the Negro colleges in the South offer such poor schooling it would be just as well if they did go out of existence, and suggested that many of the 30 de-accredited schools “should stop trying to be four-year colleges; they should become junior colleges and attempt to excel at the basic skills job.” He said Negroes that attended them would then at least come away with the equivalent of a good high school education. He predicted that only one Negro college in Alabama and one in Mississippi will be accredited. lieve in preserving that delicate relationship between banker and depositor . . . When he puts his money in our banks, he should be able to return and get it when he chooses.” Daniel, Hughes,’ Spears, and other leading advocates of the state’s case have rebutted that 40 of the 50 states have effective escheat laws, that their legislation has been recommended by the American Bar Assn. and the Council on State Governments, and don’t pass this law you’ll be making a gift of millions of dollars from the taxpayers of this state to the banks.” There have been other charges: that the banks have illegally transferred dormant accounts to their profit , columns, that they make little effort to locate owners or their heirs, that they have eaten up abandoned accounts with “service charges,” and that the absence of adequate legislation has encouraged and perhaps resulted in embezzlement. New Emphasis The governor last week shifted from his earlier stands. Rather than stressing the financial advantages to the state, \(‘Banking Cornmissioner J. M. Falkner estimates the amount of dormant funds in state and national banks in Texas said the emphasis should ‘be on finding the rightful owners after the statutory seven years has elapsed. “I do not think the banks should be able to hide these accounts forever,” Daniel said. At least a hundred national banks in Texas, he said, charge “unconscionable” service fees which often wipe out small accounts in a year. “I don’t think that’s right. They’re escheating the property to themselves. A minority of banks should not be allowed to do it, and bring discredit on the whole banking profession. To me it’s an outrage, and the citizens ought to rise up and prevent it.” Texas, he said, is ‘ the only state in which the state banking association has opposed an escheat law. Commissioner Falkner, in hearings last week, said he had evidence that the Union State Bank of South San Antonio transferred approximately $25,000 of its dormant accounts to profits while the escheat bill was being debated in the recent legislature. iDaniel commented on the San Antonio case: “Is that protecting the depositors, to take those dormant accounts and transfer them to the bank’s account? Certainly not. That San Antonio case is an example of why I think we need this legislation.” The House passed its resolution August 14, by a 77-45 vote, authorizing Speaker Jim Turman to appoint the special committee “for the purpose of recommending to the legislature a fair and equitable procedure by which unknown owners and heirs may be advertised for and discovered, and by which the state may detect and obtain any of such property which rightfully belongs to the state under present escheat laws.” The Austin American’s Sam CATHOLICISM FEARED Baptist Journal Renews Warning Texas ‘Bankers vs. State *, Daniel, Spears lead Full-Scale Campaign for Escheat Legislation 30 Negro Colleges to Lose Status