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Stale Beer Dissent In Texas Press AUSTIN Thumbing back through the records of the 57th Legislature this week, we came across a House SiMple Resolution we hadn’t been aware of before. Sponsored by Rep. W. T. Oliver, that demure political gargoyle from Port Neches, this resolution commended the capitol press corps for its conscientious reporting of the news and ordered a copy of the commendation sent to each newsman. Alack, we did not receive our carbon of Mr. Oliver’s commendation, so the empty frame on the Observer’s peeling wall must go vacant for at least another year. Remembering that he co-authored the anti-atheist bill, which the Observer treated with levity, we fear the Supreme Being has through His legislative agent, Rep. Oliver, wreaked vengeance in this way. But there are compensations. At least we have not been counted in the same league with the representatives of other Texas newspapers. Mostly they are good fellows for whom we have a real affection, but they have for so long been forbidden to report the news as they would like to report it, that they have become journalistically pop-eyed, like fish in the oceans’ deeps, blind to normal light. A COUPLE OF East Coast newspapers were once described by A. J. Liebling as “straight McCarthyon-the-rocks, with a sprig Of David Lawrence.” The bulk of Texas’ daily newspapers are not so intoxicating as that. They are mostly stale beer. But they do try. When McCarthy was alive, publishers, being generally a group of men preoccupied with what is going on in the business office, were sometimes not aware that McCarthy was for them. He was their man, and some of them didn’t know it. This was their tragedya tragic mistake they have had to think about in the intervening years without, until recently, a chance to atone for. This week, we were happy to see, the Texas editors and publishers ightened their consciences by inviting exgeneral Edwin Walker and airlines czar Eddie Rickenbacker to address the annual meeting of the Texas Press Association. Edwin and Eddie stand for McCarthyism in a big way, and in fact praise his memory at every opportunity. Passing through Austin, Rickenbacker told the Chamber of Commerce that some day this country would be proud to build a monument to McCarthy. We don’t know if he told the Texas eds and pubs the same thing, but after what he did tell them, they must have been able to fill in the rest. Walker, of course, was up to his usual paranoiac flutterings, assuring the editors and publishersnote we carefully have refrained from calling them newsmenthat he himself, Edever more, world without end, “the symbol of patriotism for this country.” A number of the editors and publishers, we are told, did not applaud. Doubtless these heroes of dissent have put it around all over their hometowns, how “By God, I don’t go for that fanatical stuff.” But this is conversation : Where have they contradicted Rickenbacker and Walker in print calling them by name, and identifying them for what they are: one, a bad-mouthing military bully ; the other, a malicious rich man who has grown bitter toward this generation that has, for the most part, innocently forgotten the fame he deserved more than 40 years ago. B. S. AUSTIN Businessmen, too, have rights against the government. As a class they have so obtusely opposed government regulation, many American liberals have lost sympathy with them, even when their grievances have been just. Yet liberalism must uphold any individual who is abused by those with power over him. From the evidence we have seen it appears that Robert Mullen Sr., president, the Alice Savings and Loan Assn. of Alice, Texas, is such an individual. The Federal Home Loan Bank Board has made things extremely difficult for the association. Though impressed by explanations from persons known to us in the association, as a depositor therein we were naturally alarmed when the feds closed in. So were other depositors. During a similar situation in 1960, when the board took over the Long Beach Savings and Loan Assn., deposits declined $37 million in one month. FROM THE FIRST it seemed plausible that a Republican government agency might choose to harass the Alice association which, years ahead of most other savings and loan institutions, opted to pay its depositors four percent interest and therefore, in the view of the three percenters, engaged in unfair competition. The government’s charges seemed to be nit-pickings, and certainly no justification for the drastic public steps the government had taken, obliging the officers of the association to proffer almost desperate reassurances to all its customers. The government never once suggested insolvency. As John E. Moss of California, chairman of the subcommittee on the Home Loan Bank Board of the U.S. House of Representatives committee on government operations, said, “There is no question, not the slightest shadow of a doubt, as to the soundness of the Alice Savings and Loan Association.” Yet the government slammed it around in the public view. The Mullens own much of Alice and the surrounding land, and they have issued many loans for homes in which they have a financial interest. This does not violate any federal law. It illustrates the way in which the free enterprise system tends to let the rich get richer, but it also resulted in many persons owning their homes. Ennis M. Oakes is president of the government’s Federal Home Loan Bank in Little Rock, Ark. On May 15, 1961, Oakes wrote the director of the federal board’s division of supervision : “I could write the Association further regarding the conflict of interest operation and other matters. However, I could possibly find myself in a continuing exchange of correspondence without any final determination . . . I see no solution to this problem other than a complete liquidation of the association, which I recognize will be a most drastic action.” This was singularly strange. If the Alice association was violating rules or regulations, all the federal board had to do was to order the officers to stop ; they would have to comply or be taken to court. Why “liquidation”? It was too much for the director of the division of supervision, who replied that there should be “additional supervisory attention” after the next examination, and then that …A9 a in It is to be noted that the American Medical Assn., the National Assn. of Manufacturers, and the National Chamber of Commerce have been fighting federal aid to states to reduce the childbirth mortality rate because it “tends to promote communism.” “the supervisory file on the subject matter may be closed.” O AKES, hauled before the Moss subcommittee, ate crow. “An ill-advised statement,” he called his own words. “. . . because of his \(Mulrounding area where he is doing business, it is not possible ever for the association to make a loan where he or some member of his family or some interest doesn’t have an interest . . . We know that it is not possible for the association to operate unless it does.” Rep. Moss: “Mr. Oakes, are any of these loans in violation of any rule or regulation . . . ?” Mr. Oakes: “No, sir . . . ” Mr. Moss : ” . . . why does this continue to be picked at as a matter of supervision ?” Mr. Oakes: “In our letter to Mr. Mullen we didn’t mention that phase of his operation. I don’t think” \(and, you will notice, in his reply to Mr. Moss, he did not answer that phase Mr. Moss: “Somewhere along the line we haven’t gotten the full story on the determination to undertake the 1958 examination of Alice Savings and Loan.. . . Normally, a special examination would not have been in order, there is nothing in the background of previous examinations to justify it. Would you agree with that?” Mr. Oakes \(who supervised the exthat.” Mr. Moss : “But it was undertaken, and it took on all the aspects, in my judgment, of a very prolonged, detailed and searching examination of everything, of a hunting expedition. . . . There was a great deal of atten AUSTIN As this issue goes to press, the Senate begins debate on HB 3, the loan shark bill. We hope both the Senate and the House, when the measure returns to that chamber, take a long look at some disturbing facts. Under the Preston Amendment of the House version, interest up to 460 percent on small-small loans would be legalized, particularly on loans of $25 to $50 made for .one month to three months and requiring weekly payments. The small-small sharks argue with much sanctimony that they fill a noble service by providing small loans for needy people. This noble service is performed by charging these needy borrowers 200 percent and more. Our second criticism of the House bill lies in the excessive charges for tie-in sales of credit insurance. In 1955 the Langer Congressional Report had this to say on tying-in individual credit insurance: “This situation places temptations before the unethical lender which too often are irresistible. Coupled with this is the inferior bargaining power of the borrowers. Especially is this true in connection with small loan transactions. . . . Because of the borrower’s inexperience in business, lack of other credit sources, his imperative need for money, the unethical lender finds it an easy matter to coerce and intimidate him into buying credit in tion paid to personal matters rather than to the matters ,of the association, and then the taking of the minutes on the $50,000 item, which again, by the admission of all who have testified, violated no rule or regulation. . . . This was an unusual examination, wasn’t it?” Mr. Oakes : “It developed into that, yes.” Mr. Moss: “Now is it to be the practice to continue here . . . to impose an impossible standard of conduct, admitted by you as impossible and unrealistic, upon this community?” Mr. Oakes confessed: “It couldn’t operate, and it would be my recommendation that it not be required to operate in accordance with the strictest rules set out here, or, we will say, opinions, because there are no rules, that is right, it can’t. . . . The records show that the institution has done a marvelous job in promoting home ownership in the community.” In other words, the supervising examiner admitted that he was carried away by his opinions and that since he had no better way to enforce them, \(as they were not embodied in suggested just shutting the damn guys . down. BUSINESSMEN s h o u l d make a mental note of the fact that when they have been genuinely abused by a governmental agency, others who believe in civil liberties become their philosophical allies. American Civil Liberties chapters are now forming in several Texas cities, Houston, Austin, and Dallas, so that the individual in Texas, whatever his station, politics, or race, will not so often be subject to abuse by policeman, employer, government agency, school, or university. FREE MEN and women have a common interest in civil liberties, whether the victim is a Marxist who wants to meet peacefully in a public building, a pacifist who wants to demonstrate peacefully in a public park, a John Bircher who wants to publish a tract advocating the nuclear bombing of Russia and China, or a businessman who has been kicked around by power-wielding government functionaries. R.D. surance. The borrower is in no position to do anything but accept the lender’s terms. One of these terms often requires the borrower to purchase the insurance exclusively from the lender. . . . These practices are literally so widespread as to inflict these abuses upon millions of borrowers and their .families.” The regulation features of the House measure are adequate ; it is the rates which are totally unreasonable. Unless the credit insurance tie-in sale and the Preston Amendment are eliminated, HB 3 will legalize outrageously high rates of interest. This would be, in effect, a repudiation of the will of the voters as expressed in their overwhelming approval of the loan shark constitutional amendment of 1960. If these features remain in the bill, the situation would, in fact, have gone from bad to worse because excessive rates would be legalized. Although Gov. Daniel is to be congratulated on the progress of the session in other areas, it is a plain fact he has not fought for good small loan legislation with reasonable rates. He has treated the problem with a great deal of indifference. He has been quoted recently as saying he is not concerned with the rates permitted so long as the industry is brought under licensing and regulation. This position is patently absurd. The need for regulation is to prevent excessive rates. Otherwise, why regulate at all? BUSINESSMEN, LIBERTARIANS Strange Philosophical Allies REGULATING RATES