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TIDAL WAVE .OF RED INK
NEWSMAKEH PROFILE
STRAINS U.S. ECONOMY
Sllah otlran
Q.
Mr.
Pnsld~nt.
whtn Y9"
Mn
Mmortf¡ LAadtr of tht House,
~-ould
you
not haWJ
bun
horrifi.d
by
o prtlidtnt
whtJ • ..
predit:Jed a SJO
blfllon tltjiCII
anJ
then
proposeJ
u
blg
IQX CUI
M
IOp
oj/1?
A . Wt/1.
/'m
horrijitd
a.r
Pnsl·
dtnl.
Fro"
~·•
Ford)
pras
c:onr~fiCit.
la• W11')'11.l91S
Burdencd under
a
proj«tcd dcfi·
en of SS2 bitlíon in 1976.
$70
bll·
hon of Congrcss docsn·r go along
wnh ¡roposed budgel cuu. lhe
UnJie Slai<S Treasury plans 10
borrow on esrimared $28 bitlion in
thc ncxt ftve months. The movc
'will
spill more
red ink onto govern·
mcnt
books
than at any
tirn.e
since
World Warll
To facilltate the massive deficit
spendona. Trell!ury o!licial$ have
askcd for a hikc
U.
lhe nauonal
debl cerhn& from
S49S
lo
$604
btl·
hon The new figure represenu ap–
proxomarely $2,800 for evcry man.
woman. ond child loving
on
lhc
Unitcd States.
Thc extra indebtednes:s tcftecl$
lO SOme dcgrcc lhc elfeCIS of
IIX
cuts to pull the economy out of t.he
current recession. But
it
also rcprc·
sents the
unwiiHngoess
(and. in
par~
onabílily) of bolh lhe execu·
hvt end
lt¡dla.tivc
bodies - Upc-·
cially the
lauer -
co
curta.tl
spendon&-
ll's nol popular
10
cul
lhe
soaal
wclfarc spending
that
has
c:ausc:d
thc: lion's share of tbe
inacase
in
lhc federol budgel since 196S. And
u·s almos• impossible 10 lop olf
mandared. legally non-reducible
prog.ranu that werc passed in more
proaperous days when Americ:ans
lhoughl rhey wer<: heading inro rhe
"Grur Sociery.•
lntcrat alonc on the naüonal
dcbt
now
run.s ovcr 30
b1lhon
dollan
a
year. third behind soaal
welfare and defense
in
federal oul·
la
y.
The
dtbt
is
working enonnous
burdens on the natjon's mooey
market.s. Sorne economists
esuma.te
that two
out
of every three lend·
able dollan on the Unired Srares
cnd up ín ¡ovemment bands. lhtlc
money
i.s
ten
ovcr
Cor
pnvate ln·
vcsunent.
Wllh feder>.l borrowing soakin&
up
so
muc:h oflhe availablc money.
key
~non
of lhe economy suc:h as
hous1ns
and automotive arcas
be·
come especially vulnerable.
In adduion, thc general mone·
taty dearlh
(orces
up intt"re.st rates
as all
bu~tine.sscs
compete for whllt·
ever runds are lefl over. The hi¡her
rates deter c:cpansion while addan¡
extra cosls to doing busineu -
COSlS which worfc their way
even·
lually onro hogher pri<e$. mcaniog
more 1nftation.
Thus. increasing federal debl
&oad. 1ntended to stimula.te
('(!Oo
nomic reoovery, tends to
be
self·
defcating. lcading to s:lresses up
and down rhe
fiscal
ladder. In rhe
cnd~
a
far worse reecssion -
cven
depreiSion - could become all rhe
more inevitable. o
WEEK ENDINO FEB. 22.
1975
Brltaln Tumbles oown
Eurooe's Economic Ladder
The
stable. commoo·SCDSC:
8rh·
osh nation. lhe Morber of Parha·
mcnl$. more: at1.d more rese:mbles •
banana republic.
The prestigious Hudson lnst11u1e
predicu rhar by rhe early ei&hlies
Briu1in will
take Spain"s posltlon
u
onc of thc poorest places to live in
Europe.
lnftarion boils along •• 22 per·
ccnt - or 27 pcrccnt depcnding ·on
wh1ch
slatistic:s
onc
uses. No
de·
mocracy. say lhe historians.. evcr
Ion¡
survived inllation ratc.s
over
20pe=nL
In three
yeafs.
England's money
supply has vown by sixry pe=••
- 1
stag,genng arnount t.o absorb.
The
nation
is
chokíng on
it -
•n
the
form of spiraling pria:s. batanee of
paymcnos deficios reaching ludí·
crous proportions. a wcakcned
pound stcrljng. and now thc inev1·
lable hang.over - unemployment
approaching the mili
ion
mark.
To add io.sult to m¡ury. rhe
vaunted lifclin.e of
the rulin¡ La·
bour ¡ovemment - thc ""'social
contract" whereby untans moder·
ate wage demands
in
tt.turn for
"socialist
gove:mment.. - appean
10
be
c:oming
unglued. A na.hon·
wide ooa.J mine shutdown
looms
again while che increasingly renlc:ss
middle cJass: as secn in the rccent
doctors· strilce is showing iLS wilf·
ingness
co
achicve
its
cnds by force·
ful means as
wdl
And lhe bad news keeps rolhng
in íbe
Londotl
s:todc
exchange
i.s
at a twenty·year lo-..·; cwo bt¡ con·
ocrns. Burmah Oil and Brollsh Ley·
land, appealed 10 rhe Broush
aovemment for a finanoal bale-out
lO keep from goiog under: and
sporu car maoufaclUrcr Aston
Marun simply gavc up the ghosl.
Oalloping inflation on lhe óne
hand plus paymcniS dollicuhics on
che olher are squu:tJna the British
economy
in a dramat•c
pincer
movemenL DevaJuauon
IS
scen
as
no cure bec::ause an tconomy •n
whtch imporu play
so
lar&< a role
can'r alford 10 pay
mon
{or rhose
imporls.
The
frantic
search for
solulions
ranges beyond price conrrols 10
proposaJs for radiul impon restnc·
tions..
Tbis
would
be
a move of des–
peraüon - ooe which
JU.Sl
mig_ht
bring the wbole
inlcrnacional
house·of-c:ards uadln¡ system
eruhing down
as
other
rtaiiOI\S
in·
sritute their
owo
protcctionist
mea–
sures. Cen.a.inly. at abe very least.
sucb a move oould seriowly endan·
ger the Brilish posi1ion in 1he Euro·
pcan Community. Yet che impor1
tide may be so grut lhat
Britain's
leadcrs will feel compelled lo rake
such drastic mca.sures.
Hovcring sinistet·lllc:e over the
eoonomic chaos
is
thc pohtical tur·
moil that lhtu.leru to a.me from
1l
A
natioo c.:cpencooog
a rerun
of
lhe 1930's may nol be able
10
con·
tinue: in a middle-of·lhe·road.
poli·
cics·aS·usual postutt:.
Last
su.mmer,
when
small
prtvate
armies
emerged lo
do
bBttJe wilh
jndustriaJ strikers. the Brilish
press
bewaired lhem as sig.ns
oC
some
horrible righr-wing eoup In rhe
malcing. While lhis analysis was
overdone.
lhe
phenomena
or
citi·
ze.ns tak.ing
thtnp
anto thetr
own
hands
is
not • c:omfonablt one ror
any
dem-oaaüc state.
The uu1enec
of privare groups of
~Sin
ke break·
en" is a r<lhalc
Rgn
10 rhe Brirosh
public 1ha1 all
is
cerlaonly nor
~<ell
- and lhal segmeniS of lhe popu·
lation
~re
growin¡ de5ptrate for
answers in tbc facc of so much
gloom. o
HowtoSpend
Oil
Billions
LeastofHis
Worries
King of Kings. Li¡hl of lhe
Aryans. Shadow of lhe Almighly,
Vice·Rcseot or God. Cenrre of lhe
Unjverse. Tbe
man who
coday
holds lhese ancoenl royal tilles.
Shab Mobammed Rou Pahlavi clf
lra.n.
is • ·
mona~h
with
1
vision..
T'hat visioo
LS
to rev1ve the glory of
the
ancient Persian Empire
by
tntnsformin¡
his
backward but
oil- . .
ricb Moslcm nation of
32
million
people into a major power within
15
yean.
U
all gocs according to the
Shab's plans, thu envisioned
..Gre.:u
Civiliution·•
will
rival lhe
powcr
and inftuencc which
lhe
61\h
c:enrury B.C. Penian Empino of
Cyrus and Danus commanded
in
the aocicnl world.
"Lel- me 1ell you:· rhe 55-year·
otd monarch asserted in an tnltr·
view
IMl
year, ••in
25
years
we
wiiJ
be lhe Srh largesr world power and
we
shall
have a round
65
million
people." On rhc road lo rhal goal,
he hopes to achievc lhc level of the
current Euiopc-an powers in
10
to
12 years - a
Wmsdaftswuntkr
un·
panllelcd
$ÍDC<:
lhe days of West
Germany·s spectacular postwar
~
rúe.
The Shab os in a hurry because.
though
lran
i.s
currtnlly the world"s
~:":Ctc~;~~~¡ ~~~e;/:7~"~~;;
will
bcgin running our by .1990 or
so. The Shah ninu 10 devclop his
nation beforc
that
happens.
Crowoed H lm•elf
The ambuious kin¡ ascended lhe
emerald
aod
ruby·sruddcd Peacock
Throne a l lhe age of 2 1 upon his
falher's abdocarion in 1941. The
Shah put oft"his officíal eoronatlon.
however. unlil 1967. Then. like Na–
poleon. he erowned homself wirh
Jran's glouenng
IO.~r>.l
Pah·
la
vi
crown.
The Shah
is
mamed 10 36-year·
old Empress Farah Doba. daughrer
of an lranian army c.apt.ain.
The
royal couple
has four childreo.
c~o
boys agcd 14 and 8. and rwo gorls
aged
11
and 4. Their elder son.
Crown Prince Riu, is , the desig·
natc:d heir to lran's throne. (The
Shah has approved rhe in«<·
changeable use of"Jran" and "Per·
sia•• as the officia1 name of the
eounrry.) Empress Farah has been
oamed r<:¡enr for lhe Crown Prin«:
should lhe Shth doe befor<: bis son
rums
20
m
19&0.
lran·s energetie monarch has sur·
vived
two
extrcmely closc
assa.ssi–
nation attemplS since assuming lhe
rhrone.
"1'11
sra_y
alivc lill such lime
as
1'11
have finoshed wliar 1 ser our
10 accomplish," he has confidenrly
declared.
~And
1ha1 day -has bcen
markcd by Ood. nol by
!hose
who
wlsh lo usassínate me...
Re-olullon From tbe
Topoo.....
-rhe ton¡'s JOb
os a
big head–
achc.- the rulcr commeyted rt·
ccntly. Aod
hi$
task. to
be
sure.
is
not
an ealy
one. Ove-r
half bis
na·
<ion (roughly rhc
slze
of \\(<Srcm
Europe) is srill illirerare. rhe 11\ajor·
hy
live
in
poverty, and most of lhe
land
is unworkable without ani·
ficial
irrigahon.
Thc Shah. consequenlly.
has
ini·
tiated cxtens:ive projeas to con–
strvce
d.tms.
roads. nuclear powcr
planrs. ochools. hospirals.
aod
steel
11\)lls all over rhe oounrry. largely
fundtd
Wllh thC 011
rr.oney Which
is
pouring
into thc
national treasury
ata rate
or
over
$2
billion
a
month.
Thcse
prog.rarns are
pan of
what
he
calls rhe "Shah· Pcoplc Revolu·
tion.··
(Contlnu.J on
pog<
4. col. 4J
lhe
Last Rays
of Empire
Flicker Away
Prompred by economic lrouble.
Britain's Labour Govtrnmcru
has
announced
a
ten year. $11.2 billion
cul in defense spending. induding
over
S720
mollion for 1975.
Then: w1ll
be
a
reduction of
about
3S.OOO
service
men
and
about
30.000 civ1Hans in defcosc
r<lared JObs. Twelve Royal Air
Force bases woll be closed.
One sevcnlh of Britain's
descroy–
ers. fn8-ates and mine counter#mea·
sure vcsscls will
be
scrapped as well
as
one quarter
of i1s
convent ional
submanne Rcet.
As •
resuh of lh< harcher work
juSl
about
tll
vnuges of the formcr
British Emp.re will
soon
vanub. A
tiny
bll!e
11
Hon& Kong 2nd al
Di<&O Gama in rhe lndiao Occan
are
essenually
aiJ
that
will
remain
of lhe narion's once &lobe·girdling
military
migh1.
Bases tn lhc lndian
Ocean
on
the
islands ofMautirius and Ganar<: 10 be
ctosed.
Large
reductions
will
be
made
in
Corees
at
Hong
Kong
and
Cyprus. The Ghurka Ballalion al
. Brunei
on Borneo
will
go.
Armed
forus on Malta wlll leavc when the
prese:nl agccmenl
expires.
Mihrary experu fear 1ha1 NATO
secunly
t.s
now
weakcned sigmfi·
cancty •n the Eastem Mcdirerra–
ncan wbere the only major Allied
foroc is thc Slxrh Fleet. NATO Scc·
retary~G~ncral
Luns ttrmed 1hc
slash as •
"swin~
o(
slralcgic ad·
vantagc in
Russia
s f'avor."
!Contln11.d on poge S. col. /)
3