NATION AND WORLD
University Daily Kansan, February 7, 1984
Page 9
Fed sets a wary financial course for 1984
By United Press International
WASHINGTON — The Federal Reserve Board, warning more strongly than ever about the dangers of big defics, told Congress yesterday that it has a cautious set of policy guidelines for 1984 in doing out money and credit.
The board made it clear in an annual report to Congress that it intends to accommodate the rate of economic growth that is already anticipated by President Congress. But the board also stands to cut short any inflationary surges.
The new report contains the Fed's most extensive warnings yet that high federal deficits are "dominating the outlook for credit flows in the year ahead," according to a market pessimism blamed for sharp declines in stock prices in recent days.
"THE PERSISTENCE OF large deficits in the face of strengthening private credit demands would tend to exert pressures on domestic credit markets, keeping interest rates higher than they would be," the policy statement said.
The report dismissed the economic progress made last year as a largely routine rebound from recession and said the year was not proof of a permanent victory for anti-inflation policy.
Board Chairman Paul Volcker will testify on the report before Congress
The board's analysis of the effect of deficits on interest rates and trade performance paralleled that delivered last week by the president's top adviser, Martin Peldstein, in the Council of Economic Advisers report to Congress.
THE NEW FED policy statement
spelled out virtually the same targets for growth of the money supply as tentatively set earlier. It also contained revisions in 1983 figures showing that cash available at the end of the year grew more than was evident at the time.
The report also said the board would be only slightly less wary of returning to a strict interpretation of "M-1," the most widely-followed category of the money supply. The Fed has been paying less attention to this category, because it has been distorted by the deregulation of bank interest rates.
The annual money targets announced each year mean little to analysts trying to decide if interest rates will climb in the next three months. Other factors, such as the pace of business borrowing and how fast money moves through the economy also influence the competition for credit.
THE HOUSING INDUSTRY would
be the first to benefit if federal deficits were reduced by substantial amounts — $50 billion to $10 billion a year, the board said. Although whatever tax increases or spending cuts were involved would not take effect until later, interest rates could respond immediately, the Fed said.
"The counterpart rise in private credit may be the most noticeable initially in mortgage markets at the lower long-term interest rates that are likely to evolve," the board said. "In addition, businesses would be in a position to increase bond and stock offerings."
Fed critics have disagreed on the shortcomings of last year's board performance, some saying it would lead to a "flawed" soon and others seeing higher inflation.
The Fed said that it was right on the tip of the nail to successfully keep inflation low while raising
Taxpayers pay for junkets to the Paris Air Show
EDITOR'S NOTE: This is the second in a series of reports investigating overseas travel made by industry researchers.
By GREGORY GORDON United Press International
WASHINGTON — Like swallows returning to Capistrano, 36 members of Congress flocked to Paris last spring for the world's grandest extravaganza, probably some of the finest free meals they ever will eat
House and Senate members attending the weeklong Paris Air Show were so lavishly wined and dined by aerospace industry firms that one member among nine congressional delegations called it "disgusting."
White House and Senate members drew $131 in daily expense money from the U.S. Embassy, defense and aerospace contractors picked up fat tabs at Tour de France meetings, the city's dinner spots, several congressmen said in a survey.
SHUTTLE BUSSES SERVED the hotel entrance, but 10 members rented mid-sized, chauffeur-driven Mercedes and Peugeots at a taxpayer cost of $18,848, United Press International and the non-profit Better Government Association found in a review of embassy and Pentagon vouchers.
Sen. John Tower, R-Texas, chairman of the Senate Armed Services Committee who was President Reagan's personal representative, hired two limeauxs for himself, his wife and two staffers for $5,303.
Melvin Price, D-III, rented two cars for his House Armed Services Committee delegation at a cost of $5.759. Ron DeLugo, a non-voting delegate from the Virgin Islands, sent $1.372 on a car.
ALTHOUGH EMBASSY CHARGES for the suite and refreshments reserved by a House Science and Technology Committee delegation headed by Rep. Donald Fuqua, D-Fla., totaled $2,555, sources said Price insisted on a separate control room for his contingent. It cost an additional $2.908.
In a four-month investigation, UPI and the BGA found the Paris Air Rife with the kinds of excesses that helped drive congressional overseas travel costs to more than $21.6 million in fiscal 1983.
Taxpayer cost for representation in Paris by delegations of at least 142 House and Senate members, spouses and aides easily exceeded $252,000. Two-thirds of the money was for airfare because within 24 hours, Price's 15-member delegation, a 13-member House Appropriations Committee team headed by Rep. Bill Chappell, D-Fla., and Fauqua's 29 members, took three military planes to Paris at a cost of $217,000.
CAPITOL HILL SOURCES said prices of meals that contractors bought congressmen and their wives often exceeded the limits of ethics rules barring acceptance of the laws, from those with an interest in pending legislation.
Rep. Jack Edwards, R-Ala, who dined at The Ritz as guest of a contractor, he cannot remember, said, "I know that there are rules to play by and . . . I played by those rules. I don't know what it costs to
Said Rep. Robert Badham, R-Calfi: "As our political leader from California once said, if 'you can eat their food and drink their liquor and take their wine,' I will believe you belong in this business." And I've done all of the above.
Defense contractors deny padding government contracts with entertainment expenses. But law enforcement sources disclosed that a federal grand jury in Florida is probing allegations that Pratt and Whitney, a division of United Technologies Inc., improperly charged the Pentagon for entertainment expenses, including some from the 34th Paris Air Show in 1981.
have a dinner in a nice French restaurant "
One U.S. official said he only saw a handful of House and Senate members and a smattering of aides in response.
ROBERT STANGARONE, Pratt and Whitney
spokesman in West Palm Beach. Fla., declined
EVAN GALBRAITH, U.S. ambassador to France who cabled the State Department to complain about the crush of 658 official U.S. visitors, said embassy burdens were extreme.
"I had senior political officers having to deal with menus for dinners, and supplies and taxis and all sorts of menial things," he recalls. "It's sort of a glorified nanny."
Members of Congress did not limit their regal living abroad to the Paris Air Show.
Next: Tower retires in style
By United Press International
Nicaraguan elections are back on schedule
Nicaragua's Council of State yesterday said it would make a rough draft of its electoral law public only one day later than originally planned, putting 1985 elections back on schedule.
Another communique from the ruling junta said the date and other details for presidential, vice-presidential and constituent selections in 1965 would still be announced Feb. 21 as planned earlier
The junta condemned air attacks last week in Chinandega Province in northwest Nicaragua by rebels, but the president has refused to postpone the elections.
THE COMMISSION WILL also make public tomorrow a rough draft of the proposed legal law origi- nated to be released the day before.
When the commission postponed today's announcement last week, many observers feared elections could be delayed or canceled.
The junta, however, did warn that continued attacks by U.S.-backed rebels could result in the disruption of the elections.
The attacks, which the Sandinistas claim were directed by the United States and carried out by anti-government rebels based in Honduras, were also protested by the United Nations Security Council.
In El Salvador, the U.S.-backed army prepared to launch new counterinurgency drives in rebel-controlled regions in the first test of a modified command structure put place. Nov 7, military sources said.
U. S.TRAINED battalions and "hunter" units began deployment Sunday in northern Chalatenango province, far northwestern Morazan province and southeastern Usulutan province, military sources said.
El Salvador's ultra-right political party has not considered switching presidential candidates, despite allegations that the current choice
— Roberto d'Aubuisson — ordered the 1980 slaying of Catholic Archbishop Oscar Carmello Romero.
British pilots plan an attempt to set balloon-altitude record
By United Press International
PAGE, Ariz. — Two British pilots will attempt to set a world hot-air balloon altitude record today and become England's first astronauts.
Peter Mason, a spokesman for Operation Sky Quest, said yesterday that "all systems are go" for the balloon launch.
"The balloon is ready, the capsule is ready, the pilots are ready," he said. "The only thing that can stop us now is an increase in the winds."
Mike Kendrick, 37, of Bridgnorth,
England, and Per Lindstrand, 35,
of Oswestry, England, hope to飞 at about
80,000 feet — more than 25,000 feet
higher than the current balloon record set in 1980 over Denver.
After a three-day delay caused $ _{12} $ strong surface winds, Mason said that calm conditions were needed for the launch.
"There's a lot riding on this, including two guys' lives," Mason said.
He said the men would wear presurized spacesuits because no oxygen was available.
A 30-man ground crew spent most of the summer making adjustments on the sandy
Saturday night the crew did a test inflation, Mason said. They needed between 60 and 90 minutes to fill the tank. The gas holds 1.5 million cubic feet of hot air.
DELTA DELTA DELTA SCHOLARSHIP AWARD
If you are an undergraduate woman enrolled at KU with a high degree of academic achievement and community service work, you could win a scholarship worth $534 (or one semester's tuition at KU). The winner of this scholarship would then be eligible to compete for the Zoe Gore Perrin National Scholarship worth $1,000!
Applications available at the Tri-Delta house or for more information, call 843-4610. Deadline is March 1, 1984.
Questionnaires for
MORTAR BOARD National Senior Honor Society
may be picked up in the Office of Student Affairs, 214 Strong. All juniors and first semester seniors with at least a 3.0 grade point average are eligible. Deadline to return questionnaires is Friday, Feb. 24.
MINI-TOURNAMENTS at The Jay Bowl
By Recreation Services
Mondays at 4 p.m.
starts Feb.13
INTRAMURAL BOWLING
Entry Deadline: Thursday Feb. 9
208 Robinson
Fees charged at The Jay Bowl
1 Day Ektachrome Slide Processing
PHOTOGRAPHIC SERVICES 864.4767
- Slide Duplication
Contact: University Placement Center 223 Carruth-O'Leary Hall to make an appointment. EOE/AA
Serving K.U. Students, Faculty, and Staff
Complete Black & White Services
*B/W prints to $ 2 0 \times 2 4^{\circ} $
- Passport & Resume Photos Taken *
Slides of Original Art and Photographs
Slides of Original Art and Photographs
Price List Available
More Other Surfaces Rush Service Available
All applicants should possess excellent writing ability, strong representational skills and knowledge of foreign language. Q.S. citizenship required. Starting date open. Starting salary range: $17,138-$20,956 depending on education and experience.
On Feb. 14 a representative of the
Central Intelligence Agency
Analysts—MA, international relations, area studies, foreign languages; BA with overseas working experience or post-BA education.
206 Art and Design Building
Librarians—MLS or BA liberal arts with library experience. Geographers—MS or MA, BS or BA geography/cartography or equivalent.
will interview prospective applicants for positions in the Washington, D.C. area. Positions and qualifications are:
Buy a $12 membership and you will receive a $10 gift certificate from Sgt. Preston's
TUESDAY----40c DRAWS
WEDNESDAY NIGHT IS LADIES NIGHT
SGT. PRESTON'S WANTS YOU
25c Draws 50c 7 p.m.-2 a.m.
RECIPROCAL TO 80 CLUBS IN KS.
OPEN 11 am-3 am
OPEN TO PUBLIC
11 am-2 pm
815 New Hampshire
presents Gene Hoffer speaking on "What Makes A Good Campaign"
JOIN THE COLLEGE REPUBLICANS
Date: Feb. 7, 1984
Time: 7 p.m.
Place: Council Room at the Union
"I don't know what the hardest shot in golf is, but the easiest shot is the first shot at the 19th hole.
$1.25 drinks & 50c Draws tonight."
-W.C. Fields
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