THE NOME NUGGET
Published Monday, Wednesday and Friday by the
NOME PUBLISHING CO.
NOME, ALASKA
Telephone: Main 125 P. O. Box 618
$1.50 PER MONTH $16.00 A YEAR
W. A. Boucher .Owner-Publisher
Entered as second class matter October 14, 1943, at the postoffice
•t Nome, Alaska, under the Act of March 3, 1879.
Nome, Alaska, Monday, August 22, 1949
STARTLING, BUT TRUE
Here is a statement that should shock the people of
the United States:
“We could have shortened the war by at least six
months with a saving of $50,000,000,000, more or less,
and hundreds of thousands of American casualties.”
Who is it that makes such a startling declaration?
None other than Gen. George C. Marshall who, as Chief
of Staff, planned the prosecution of the war for the
war for the United States. How does he think the
United States could have shortened the war, with a
saving of money and lives?
In the fall and spring of 1939 the leaders of the na
tion. acutely aware of what was going on in the world,
begged Congress for prompt action to prepare the
United States for its own defense. If these requirements
had been met, “even to a modest degree,” the General
feels that the nation would have been spared much suf
fering and financial loss.
Today, according to Gen. Marshall, the nation faces
a situation that is “almost exactly like 1940-41.” He ad
mits he is “very fearful of delays” and questions the ad
vantage of small cuts in connection with the program to
assist the western nations of Europe to rearm.
If there is anybody who doubts the accuracy of what
Gen. Marshall says about the similarity of the present
threat to peace and that which existed in 1939, let him
hunt of a newspaper of the era when Hitler had Europe
by the ears. Read it carefully and, in place of Germany’s
military power and aggressive actions, consider the rec
ord of Soviet Russia in Eastern Europe.
ENDING TRIBAL HAPPINESS
We are always intrigued by explorers—they always
come home with stories of discoveries, adding a bit to
the sum total of the world’s knowledge.
One explorer, not too long ago, announced his dis
covery of a primitive village, in Africa, “where perfect
happiness exists.” He remained a week in the village,
where no white man had been seen before, and never
noticed a sign of anger—only laughter and general hap
piness!
Think of what the visit of this explorer will mean to
the happy life of these native people. As news of their
“happiness” gets around among civilized people, more
and more white men will visit them and, gradually, the
blessings of civilization will demoralize the happy tribe.
The aborigines may learn of white men’s miracles, of
their troubles and, even, of their moralities!
It seems a pity for a tribe to develop its happiness and
then have an inquisitive stranger, representing a for
eign breed, intrude upon them and, perhaps, introduce
some of the “vices” of educated and civilized men.
ARMY SURRENDERS FLEET
Not many people know that the Army operated more
ships at sea during World War II than the Navy for the
purpose of transporting troops and supplies but the
“fleet,” consisting of 320 ocean-going vessels, will be
transferred as a unit to the Navy in October.
We call attention to the fact that the Army owns1129
ocean-going vessels, including 66 passenger transports,
58 cargo transports and five tankers. This will give the
people of this country some idea of the magnitude of
our present operations abroad in connection with occu
pation responsibilities. The army also has 320 ships
chartered, some operated by army crews and others by
civilians.
The average American reads of the tremendous ex
penses connected with our occupation forces abroad
but there is sometimes confusion as to the reasons for
such expense. The size of the army fleet, which is large
ly used for the support of our forces abroad, gives some
indication of the gigantic task the army assumed.
Communication
Nome, Alaska,
Aug. 18, 1949
Editor Nome Nugget.
Dear Sir:
In your issue of Aug. 17, the As
sociated Press dispatch states that
the interested Seattle bank has
cancelled a recently negotiated
one-million dollar loan to the Ter
ritory of Alaska. The cancellation
resulted from the discovery that
Territorial indebtedness is two
and a half million dollars instead
of one million, and that it will
“progressively mount.” To which
the cry of intimidation by the “in
trenched interests” is raised at
Juneau, charging that these “in
terests” are seeking to force a spe
cial session of the Legislature so
as to modify or repeal existing
legislation and enact a sales tax.
Nowhere was there any men
tion, in the form of a denial or af
firmation, that the Territory’s in
debtedness is presently two and
one-half million dollars, and due
to increase in the next few
months—It remained for the Seat
tle and Territorial bankers to ac
quaint the people of the Territory
with the amount of the total in
| debtedness.
The people of the Second Judi
cial Division of Alaska have elect
ed me to represent them in Alas
ka's Legislature on a number of
occasions, the last in October,
1948, to a 4-year term in the Sen
ate. I therefore feel an obbligation
to report to them through the col
umns of the “Nugget” what the
present financial predicament of
the Territory consists of and what
in my opinion should be done
about it.
The first thing is to recognize
condit:ons as they exist today, in
cluding recognition of our own
mistakes, and quit blaming every
thing on the “intrenched inter
ests.” It is time to stop crying
“wolf,” face the issue squarely
and do something about it.
The Organic Act of Congress.
1912, which is Alaska’s Constitu
tion, expressly state “. . . nor shall
the Territory have power or au
thority to create or assume any
bonded indebtedness whatever;
nor to borrow money in the name
of the Territory; nor to pledge the
faith of the people of the same,
for any loan whatever, either di
rectly or indirectly.”
The recent ill-fated one-million
dollar “loan” as it was termed by
| the press, was really a sale to the
banks of one million dollars worth
i
of vouchers accumulated the past
several months in Territorial Aud
itor Boyle’s office in Juneau. In
I
volved however was SI5,000 worth
of interest charges for holding the
vouchers for 6 months while wait
i ing repayment from the Territory,
i with 15 citizens signing individual
one-thousand dollar notes as a
1 guarantee of repayment in case
I the next Legislature refused to ap
! propriate this sum with which to
pay the banks’ interest charges,
i This entire procedure is skating
on very thin ice, is only a stop gap
at best, and no proper solution to
I the problem confronting the Ter
ritory.
The accumulated vouchers or
warrants now reposing in Auditor
Boyle’s office, and which are be
ing added t > daily, are acknowl
edgements by the Territory of
services rendered, and m rues due
and payable by the Territorial
treasurer. The only mcra is of pay
ment t e treasurer ha- is from tax
rece ms that go directly into the
General Fund.
Paradoxically as it may sound,
there is at present approximately
two million dollars in the Terri
torial treasury but—and here is
the catch—these are ear-marked
funds and cannot be spent for any
other puro. sa than that le-ignated
under the law. Fo • instance the
gasoline and fuel tax m »n cs can
only be spent for roads, airfields,
water and harbor facilities; the
1 tobacco tax, for school construe
: tion. These two tax measures alone
bring in several million dollars
during the year.
I regret ‘hat Henry Roden, act
ing treasurer, has had to bear the
1 brunt of recent publicity, both
, here and in the States. Mr. Roden,
former President of the Senate,
was appointed only recently to
serve out former treasurer Oscar
Olsen’s uncompleted term, and
! has had no part in the conduct of
i the Territory’s affairs since he
completed his term as Alaska’s
Attorney General in 1943.
The main tax collections placed
directly into the General Fund
stem from the income, general
property, liquor, canned salmon,
I and mining tax laws. The mining
' industry is at present dormant,
paying taxes during the fiscal
year, 1943, in the amount of only
$166,666.17.
Under the General Property
Tax Law of 1949, payments to the
I
LAST ONE IN...
Territory do not begin until Feb.
1, 1950. The Salmon Canneries
whose 1948 fiscal year taxes
amounted to $1,411,897.00, 31 per
cent of the total taxes collected,
do not pay their taxes until early
in 1950, neither does the mining
industry.
The Income Tax Law of 1949
was made retroactive to Jan. 1,
1949, but will not become fully op
erative until next year, due to
court tests and holdbacks on the
part of many, pending further le
gal clarification.
It is apparent that the Liquor
Industry taxes, which for the fis
| cal year, 1948, were $985,114.00,
I 25 Vi per cent of the taxes collect -
| cd, and payable quarterly, plus
! he brand new Income Tax at its
I present collection level, are not
' sufficient to pay the Territory's
current operating expenses at the
prevent rate of spending. It is also
evident that the present financial
crisis will continue well into next
year unless remedial steps are
taken soon. There is only one
agency of government that can
remedy and relieve the present sit
uation — Alaska’s Legislature —
and a special session is clearly
indicated.
The Legislature can—
1. Quickly request Congress to
! pass immediate authorization for
: he Territory to bond itself for
wo and on-half million, or what
j ever sum is required to finance
the Territory until such time as
the tax income becomes sufficient
to meet the Territory’s day by day
operation costs.
2. Repeal the laws governing all
ear-marked funds, thus diverting
j the two million dollars now in the
reasury into the General Fund
mtil such time as the Territory's
Board of Administration declares
j ;he emergency over.
3. Pass a General Sales Tax to
be operative only until a specified
amount of money has been ob
tained—this amount and the rate
to be set by the Legislature.
The alternative to legislative
action is to continue to deny pay
ment for another four to six
months of several million dollars
owing tu many of our towns, busi
nesses and citizens, for refunds,
I goods sold, and services rendered.
It means the continued freezing
of the five and one-half million
dollars worth of expenditures au
thorized by the 1949 Legislature,
including two and one-half mil
lion dollars for badly needed new
school construction.
It means the paring of expendi
t tuies right down to the bare min
imum, including reduction of per
sonnel of all departments, boards
and bureaus. It means the rigid
practice of what the British call
‘austerity,” right down the line
i l Territorial government
It also means that Alaska’s cit
izens will expect to be told, from
now on, the cold, ifnvarnished
facts, unembellished by fancy
rhetoric or double talk.
Only those with a guilt complex
can fear a special session of the
Legislature.
The great States of California
and Washington only recently
' held special sessions during which
they wrestled with, and overcame,
their financial difficulties. The e
is nothing demeaning about a sp •
cial legislative session, whether it
seeks to rectify the mistakes of
earlier sessions, or to pass emer
gency legislation.
The disgrace Les in not imme
diately remedying the intolerable
situation which presently con
fronts the Territory and its peo
ple.
HOWARD LYNG.
Territorial Senator.