PAGE FXH R Napulpa lOkla , Herald Ttianuiav Jsh 19. IT]
Phase 4 Voluntary Compliance Termed Key
WASHINGTON (UPI) - E*
cerpts of President Nison's
statement Wednesda> on the
aims and actions of Phase IV of
his economic stabilization pro-
gram
The American people now face
a profound)) important decision
We have a freeze on prices which
is holding back a surge of in-
flation that would break out if
the controls were removed At
the same time the freeze is
holding down production and
creating shortages which
threaten to get worse, and cause
still higher prices as the freeze
and controls continue
The main elements in the
polic> we need are these
First, the control system must
be tough It has to hold back and
phase in gradually a large part
of the built-in pressure for
higher prices which already
exists in the economy
Second, the system must be
selective It must permit
relaxation of those restraints
which interfere most with
production, and it must not
waste effort on sectors of the
economy where stability of
prices exists The control system
should also be designed to ac-
commodate the special
problems of various sectors of
the economy under the strains of
high use of capacity
Third, the system must con-
tain sufficient assurance of its
termination at an appropriate
time to preserve incentives for
investment and production and
guard against tendencies for
controls to be perpetuated
Fourth, the control system
must be backed up by firm steps
to balance the budget, so that
excess demand does not
regenerate inflationary pres-
sures which make it difficult
either to live with the controls or
to live without them
The Program
The Coat of laving Council will
describe the Phase IV controls
program in detail in statements
and regulations These will take
effect at various times between
now and September 12. They will
include special regulations
dealing with the petroleum in-
dustry. published for comment
Here 1 will only review the
general features of the program,
to indicate its basic firmness and
i he efforts that have been made
to assure that production con-
tinues and shortages are
avoided
The controls will be man-
datory The success of the
program, however, will depend
upon a high degree of voluntary
compliance We have had that in
the past Study of the reports on
business behavior during Phase
II shows that voluntary com-
pliance was almost universal
Nevertheless, the rules we are
now proposing are stricter, and
it is only fair to those who will
comply voluntarily to assure
that there is compulsion for the
others
Except for foods, the freeze on
prices will remain in effect until
August 12 However,
modifications of the freeze rules
will be made to relieve its most
serious inequities
The fundamental pricing rule
of Phase IV is that prices are
permitted to rise as much as
costs rise, in dollars per unit of
output, without any profit
margin on the additional costs
Cost increases will be counted
from the end of 1972: cost In-
creases which occurred earlier
but had not been reflected in
prices may not be passed on In
addition to the cost rule, there
remains the previous limitation
on profit margins
l>arge firms, those with annual
sales in excess of 1100.000.000.
will be required to notify the
Cost of Living Council of In-
tended price increases and may
not put them into effect for 30
days During that period, the
Council may deny or suspend the
proposed increase
The wage standards of Phase
II and Phase III will remain in
farce Notification of wage in-
creases will continue to be
required for large employmen'
units.
Nowhere have tfcs dilemmas
of price control been cleared
than in the case of food. In the
early part of this year, rising
food prices were the Largest part
of the inflation problem,
statistically and psychological-
ly If price restraint was needed
anywhere, it was needed for
food But since the ceilings were
placed on meat prices on March
29, and especially since the
freeze was imposed on June 13.
food has given the clearest
evidence of the harm that
controls do to supplies We have
seen baby chicks drowned,
pregnant sows and cows,
bearing next year’s food,
slaughtered, and packing plants
closed down This dilemma is no
coincidence It is because food
prices were rising most rapidly
that the freeze held prices most
below their natural level and
therefore had the worst effect on
supplies
We must pick our way
carefully between a food price
pokey so rigid as to cut
p oduction sharply and to make
shortages inevitable within a
few months and a food price
pokey so loose as to give us an
unnecessary and intolerable
bulge. On this basis we have
decided on the following special
rules for food:
1    Effective immediately
processors and distributors of
food, except beef, may increase
thetr prices, on a cents-per-uni!
basis, to the extent of the in-
crease of costs of raw
agricultural products since the
freeze base period (June 14).
2    Beef prices remain under
present ceilings
3    The foregoing special rules
expire on September 12. after
which time the same rules that
apply to other products will
apply to foods
4. Raw agricultural products
remain exempt from price
control
To relieve the extreme high
prices of feeds, which have an
important effect on prices of
meat, poultry, eggs, and dairy
products, we have placed
limitations on the export of
soybeans and related products
until the new crop comes into the
market These limitations will
remain In effect for that period
But permanent control of ex-
ports is not the pokey of this
government, and we do not in-
tend at this time to broaden the
controls beyond those now in
force...
Process ot Decontrol
There is no need for me to
reiterate my desire to end
controls and return to the free
market I believe that a large
proportion of the American
people, when faced with a
rounded picture of the options,
share that desire Our experi-
ence with the freeze has
dramaticzed the essential dif-
ficulties of a controlled system
-its interference with produc-
tion; its inequities, its distor-
tions. its evasions, and the ob-
stacles it places in the way of
good international relations
And yet, I must urge a pokey
of patience. The move to
freedom now would most likely
turn Into a detour, back Into a
swamp of even more lasting
controls. 1 am impressed by the
unanimous recommendation of
the leaders of labor and business
who constitute the I-abor
Management Advisory Com-
mittee that the controls should
be terminated by the end of 1973
1 hope it will be possible to do so
and I will do everything in my
power to achieve that goal
However. I do not consider it
wise to commit ourselves to a
specific date for ending all
controls at this tune
Balancing the Budget
The key to success of our anb-
mflalion effort is the budget If
federal spending soars and the
deficit mounts, the control
system will not be able to resist
the pressure of demand The
most common cause of the
breakdown of control systems
has been failure to keep fiscal
and monetary policy under re-
straint We must not let that
happen to us
I am assured that the Federal
Reserve will cooperate in the
anti-inflation effort by slowing
down the expansion of money
and credit But monetary policy-
should not. and cannot, be ex-
pected to exercise the needed
restraint alone A further con-
tribution from the budget is
needed
I propose that we should now
take a balanced budget as our
goal for the present fiscal year
Achieving that goal will be
difficult, more difficult than it
seems at first My original ex-
penditure budget for fiscal 1974
was $268 7 billion Since that
budget was submitted economic
expansion, inflation and other
factors have raised the
estimated revenues to about the
level of the original expenditure
estimate However, while that
was happening the probable
expenditures have also been
rising as a result of higher in-
terest rates, new legislation
enacted, failure of Congress to
act on some of my recom-
mendations. and congressional
action already far advanced but
not completed
It Is clear that several billion
dollars will have to be cut from
the expenditures that are
already prt-bable if we are to
balance the budget That will be
hard, because my original
budget was tight However, I
regard it as essential and pledge
myself to work for it.
Despite the difficult conditions
and choices we now confront, the
American economy is strong
Total production is about 6.5 per
cent above a year ago, em-
ployment has risen by 3 million,
real incomes are higher than
ever There is every prospect for
further increases of output,
employment and incomes Even
in the field of inflation our
performance Is better than in
most of the world So we should
not despair of our plight But w<
have problems, and they are
serious in part because we and
ihe rest of the world expert the
highest performance from the
American economy We can do
better And we will, with mutual
understanding and the support
of the American people
Questions, Answers Concerning Phase 4 Clamps
By United Press International
Questions and answers con-
cerning lYesident Nixon's Phase
TV economic controls
O What is Phase IV?
A It's a complex set of wage
and price controls imposed on
most of the economy in the next
two months The object, as in
Phases 1. II and III. is to slow
down the rate of inflation.
O What happened to the price
freeie?
LEGAL NOTICE
A. Prices are still frozen until
Aug 12 except in the food and
health industries
O Does that mean grocery
prices are free to rise again?
A Yes, many food prices will
go up. some of them sharply
Beef prices will remain under
ceikng rules until Sept 12 But
grocers and food wholesalers
may raise prices only to reflect
increased cost of raw agricul-
tural products since June 8.
O Will nonfood prices also
start going up immodiately?
A. No Industrial, wholesale,
retail and service prices in most
cases will remain frozen until
Aug 12
O What happens after Aug.
12?
A The price freeze is kfted on
the rest of the economy on a
sector-by-sector basis. Each
sector or industry will be
governed by a special set of
rules dictating how much prices
can go up The administration
has pul forward a set of
preliminary regulations in each
case and will allow the pubkc to
comment on them until July 31.
Then the rules will be revised, U
necessary, and will take effect
Aug 12.
Q How about wages?
A. The familiar 5.5 per cent
standard for annual wage in-
creases. plus 0.7 per cent for
fringe benefits, still applies It
was mandatory during Phase II
November 1971-January 19731,
voluntary in Phase III I January -
May 1973) and now it’s man-
datory again
O Do the rules cover
everybody?
A. The Economic Stabilization
law itself requires that workers
earning $3.50 an hour or less be
exempt
Q What about my apartment
rent?
A. Rents are exempt, just as
they were during Phase III.
O Is the government going to
ration gasoline7
A Despite repeated rumors,
administration officials insist
there is no plan to impose a
World War II style gas rationing
system However, the proposed
Phase IV rules contain an
elaborate control system that
would place ceiling prices on the
petroleum industry In addition,
beginning Aug 12. you should
see a sign listing ceikng price
and octane rating on every pump
at retail gasoline stations
Q Do the Phase IV rules cover
everything?
A The new regulations con-
tinue to exempt raw agriculture
products They will also exempt
on Aug 12 lumber and plywood,
long-term coal production
contracts, public utikty rates
and all businesses with 60 or
fewer employes
O How long is all this going to
last?
A. Hie President didn’t say
and urged citizens to have
"patience" while the controls do
their work But a top-level
committee of labor and business
leaders has urged Nixon to scrap
the whole system by the end of
the year and Nixon indicated he
is leaning that way. provided
there is progress against in
flat ion
CaD So m CharterNo 14791 National Bank Region No 11
REPORT OF CONDITION. CONSOLIDATING DOMESTIC
SUBSIDIARIES. OF THE SECURITY NATIONAL BANK OF
SAPULPA IN THE STATE OF OKLAHOMA, AT THE CLOSE
OF BUSINESS ON JUNE X. 1973 PUBLISHED IN RESPONSE
TO CALL MADE BY COMPTROLLER OF THE CURRENCY.
UNDER TITLE 12, UNITED STATES CODE. SECTION 111.
ASSETS
Caah and due from banks .........  2.075,209    99
U.S Treasury securities    1.833,460    50
Obligations of other U.S. Government
agencies and corporations    250,078    12
Obligations of States and political subdivisions    2.720.U08. 13
Other securities • including 821.301 00
corporate stock)    21,301.00
Federal funds sold...................................700.000.00
Loans ...........   8.296.388    49
Bank premises, furniture and fixtures, and
other assets representing bank    premises    338.700.00
Real estate owned other than bank premises    1.300.00
Other assets    22.595    06
TOTAL ASSETS    16,259,131    29
LIABILITIES
Demand deposits of individuals.
partnerships, and corporations    4,410.429    39
Time and savings deposits of individuals,
partnerships, and corporations    7,431.473    09
Deposits of United States Government    440.882    04
Deposits of States and political    subdivisions    2.039.076.57
Certified and officers'checks, etc    171.569    54
TOTAL DEPOSITS
I a i Total demand deposits
(b) Total time and savings deposits
Other liabilities
TOTAL LIABILITIES
Reaction Divided Along Lines
WASHINGTON (UPIl -
Republican legislators are
praising Phase IV as "tough,"
but many Democrats and
spokesmen for business and
labor question its effectiveness
and say it will hurt city dwellers
and consumers generally
Senate Republican Leader
Hugh Scott and House GOP
leader Gerald R Ford both
picked up the administration's
word, "tough," to describe the
program
Scott said it "should avoid
explosive increases in the price
of food,” although he conceded
there would be short term food
price increases during the last
half of this year. L ord called it
the "best program ’’
AFLeCIO President George
Meany declined comment for the
tune being, but several leaders
of individual unions denounced
the pokey for allowing food price
increases in the months ahead.
Means Only One Thing
"Higher prices for food and
other necessities plus retention
of the 5.5 per cent wage guideline
can mean only one thing said
Paul Jennings, president of the
International Union of Electrical
Workers, "further fading behind
for working families "
"If prices of food increase as
anticipated, the government
might find it necessary to issue
food stamps because of
high prices," said James H.
Rademacher, president of the
National Association of letter
Carriers
The letter carriers recently
negotiated a 6.8 per cent first
year increase with the U.S
Postal Service, despite the
government's plea to hold wage
increases to 5.5 per cent.
Rademacher said he is "fearful"
the government will now order
the agreement rolled back
"Phase IV is a new summer
offensive against the con-
sumer." said Patrick E. Gor-
man, secretary-treasurer of the
Meatcutters “It will permit
most food prices to rise It will
presumably seek to keep wages
stabilized at unrealistic levels
that are rapidly losing their
buying power in this inflationary
era."
House Democratic leader
Thomas P. O'Neill said. "There
is no question but that it is an
increase (in the cost of living i
for the city fellow 1 just hope it
is not unbearable
"City People Disappointed"
Sen Jacob K. Javits. R-N.Y.,
said. “The city people are
disappointed that raw agricul-
tural products are uncontrol-
Sen Russell Long. D-La.,
chairman of the Senate Finance
Committee, said he doubted
Phase IV would work There
remain inequities and short-
comings," he said
Arch N. Booth, president of the
U.S. Chamber of Commerce,
said Phase IV "is another in a
series of charades that prolongs
the dangerous illusion that
economic problems can be
solved by government edict
rather than government respon-
sibility.”
"I hope the President's luck
turns." said Sen Phikp A. Hart.
D-Mich. “It will be good for
everybody."
Shell Says FTC Plan Would Boost Prices
$14,493,431.23
$ 6.268.867.54
$ 8.224.563.89
404.502 55
14.897.933 78
RESERVES ON LOANS ANI) SECURITIES
Reserve for bad debt losses on loans
(set up pursuant to IRS rulings)
TOTAL RESERVES ON LOANS AND
SECURITIES
CAPITAL ACCOUNTS
Equity capital-total
Common Stock-total par value
No. shares authorized 10,000.00
No shares outstanding 10,000 00
Surplus ..............................
Undivided profits
Reserve for contingencies and other
capital reserves
TOTAL CAPITAL ACCOUNTS
TOTAL LIABILITIES, RESERVES. AND
CAPITAL ACCOUNTS......................
MEMORANDA
Average of total deposits for the 15
calendar days ending with call date
Average of total loans for the 15 calendar
daysending with call date
I, James L. Autrey. Cashier, of the above-named bank do
hereby declare that this report of condition is true and correct to
the best of my knowledge and belief
James L. Autrey
We, the undersigned directors attest the correctness of
this repart of condition and declare that it has been examined by
us and to the best of our knowledge and belief is true and
correct
J. Milford Davis
LouT. Jackson Jr.
Walter Brown
Directors
139.958.00
139.958.00
1.221.239 51
200.000    00
510,000.00
506,239 51
5,000 00
1,221.239.51
16.259,131.29
14,346,84C 93
8,257.134.47
United Press International
Major oil companies scoffed at
the government’s trustbusting
efforts in the petroleum industry
Wednesday One of the eight
corporate giants named in a
Federal Trade Commission
antitrust complaint said the
government's action itself could
result in higher gasoline prices
“It is not just a question of the
FTC's wanting us out of the
refining business. Shell Oil
Co.’s Harry Bridges said in a
statement issued from the
company 's Houston headquar-
ters "One senator wants us out
of the transportation business. A
Florida suit wants a separation
between exploration and
production from the rest
“If all these things prevailed,
the industry would be split into a
large number of companies all
working separately, and a
company like Shell would have
to become four different com-
panies with different sharehol-
ders
“This would be completely
inefficient and would result in
high prices to the consumer." he
said
But outside the industry, the
FTC charge seemed to stir new
complaints against the major oil
companies of monopolizing and
contriving the fuel shortage to
jack up prices and rake in bigger
profits.
In Philadelphia, Peter Page,
the president of Pennsylvania's
Mayors Association, called for a
congressional “Watergate
style" investigation of major oil
firms, saying they are "out to
screw the independent dealers
and drive them out of business "
And on the West Coast, eight
major oil firms including
several named in Tuesday's
FTC antitrust complaint were
Larry Advises: Follow Strictest Law
OKLAHOMA CITY (UPI) -
Candidates would he wise to
follow whichever law is stricter,
state or federal, on campaign
contributions. Attorney General
Larry Derryberry said Wed-
nesday
He commented after it was
disclosed that Sen Dewey Bart-
lett’s campaign had received
$49,100 in caah and loans from
Bartlett and his brother, David,
during the 1072 election cam-
paign.
But Bartlett said the $30,100 in
loans had been repaid before the
election and spending from
family contributions never ex-
ceeded the $35,000 limit imposed
by federal law.
Bartlett said federal law
superseded the 16,000 limit from
one person or family contained
in stole law.
Bartlett said the federal ceil-
ing was actually $70,000 w his
case, because he had two cam-
paigns - one for the primary
and one for the general election.
denials of the past two days that
any laws had been violated.
“I want to state unequivocal-
ly," Bartlett said, "that charges
which appeared in some
newspapers in Oklahoma
recently concerning violation of
the Campaign Contributions law
by my brother and me in the 1972
senate campaign are completely
untrue.”
“There is no question that fed-
eral law is controlling in cam-
paigns far federal offices..."
Bartlett said. "...It is distressing
to read accounts implying
wrongdoing on the part of my
family."
Derryberry said he had not la-
sued an opinion and none had
been requested on whether the
state or federal law prevailed.
Where there is a conflict ba-    n .    n ,
Lease Puces Rise
would certainly be wise to follow
the stricter of the two, "
Derryberry said
“He should follow the state
law unless It is superseded by
the federal,” Derryberry said.
Derryberry said he is studying
the state law and its legislative
history in an effort to determine
its intent.
Bartlett Issued a news release
late Wednesday repeating Ms
PAWHUSKA (UPI) - One
firm paid f191,000 for its share of
oil and gas leases at the quar-
terly Osage minerals lease sale
Wednesday which was more
than the amount paid for all
teases sold at the test sale In
April.
The Tulsa firm, Dyco, bought
several of the 150 oil and gas
tease* which ware sold for a total
of $317,500, compared with
$121,110 In April’s sale.
Gas teases showed a dramatic
increaee, going from $7.00 at last
January’s sate to $10.11 an acre
Wednesday. OU teaae prices
remained about steady at $$.-01
an acre.
Most of the oil tracts were 100
scree and sold for $1,000.
ordered to send representatives
to court in \jus Angeles today to
answer questions about a 50 per
cent increase in the amount the
county has to pay for gasoline
this year as compared with last.
San Francisco’s electric utikty
company, which runs its
generators on natural gas and
oil, said it does not have enough
fuel to run at full power and has
made plans to reduce electricity
to some of its 10 million
customers next year if
necessary. The firm also said it
may resort to “selective
blackouts."
Oil company spokesman vig-
orously denied FTC accusations
that the shortage is their fault,
saying it came about depute
their efforts. The statement
issued by B R. Dorsey, board
chairman of Gulf, was typical.
“Gulf and the industry have
done an outstanding job in
meeting the growing and
changing energy needs of the
American public,’’ Dorsey said
in Pittsburgh. “This is convinc-
ingly demonstrated by the fact
that prices for gasoline and
other petroleum products have
risen at a much slower rate than
the general rate of inflation in
this country.
“I regret that this witch hunt
comas at a time when we should
be devoting all of our efforts to
meeting the potentially serious
energy shortage Americans face
today."
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