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Home Newspaper Of Oshawa, Whitby, Bowman- ville, Ajax, Pickering and neighboring, centres in Ont- ario and Durham Counties, VOL. 96--NO. 128 10¢ Single € 5c Per Week Home Ghe Oshawa Cimes OSHAWA, ONTARIO, FRIDAY, JUNE 2, 1967 elivered Weather Report Light winds bring warm air. High today 80; low tonight 50. Authorized as Second Class Mail Post Office Department Ottawa and for payment of Postage in Cash TWENTY PASES 7 DEFICIT OF $740,000,000 FORECAST FOR CANADA BY WILSON Middle East 12 PC Drug Tax Dropped Tariff On Them To Be Cut | OTTAWA (CP). -- A federal|will be admitted duty free and|"non - jdeficit of $740,000,000, the 11th| jin a row and the second largest| ¢ inflationary behavior on special mergarines for allergy|the part of those who are in a victims will be admigged to the | position to exercise strong mar- FINANCE MINISTER SHARP drinks a toast water -- to signify the end of the 12-per-cent federal sales tax on drug »rices prices which he announced in his budget speech in Ottawa Thursday night. At a press conference after the budget speech, he displayed a number of products affect- ed by the scrapping of the tax plus the cut on duties on imported drugs by 25 per cent. (CP Wirephoto) Two Israelis Killed In Syrian Skirmish TEL AVIV (AP)--Israeli sold- fers clashed with a group of Syrian infiltrators near the Syr- jan border early today and two Israelis were killed, an army spokesman announced here. The incident took place less than a mile from the border at the village of Kfar Hanassi, pop- ulated by American settlers the spokesman said. One Syrian also was killed in the clash, the army said. Four Syrians, believed members of the Syrian Palestine Command, crossed into Israel, the army added. A sub-machine-gun, ammuni- tion and two anti - personnel mines were found beside 'the khaki-clad body of the Syrian. It was the first major incident on the Syrian border, and the first deaths, since the current crisis between Israel and its OTTAWA '(CP) -- A strong} United Nations force in the Mid- dle East operating on both sides | of the Egyptian-Israeli border) was urged today by Prime Min- ister Harold Wilson of Britain. The prime- minister told a news conference he had - dis- cussed the Middle East situa- tion "very intensively" with Prime Minister Pearson Thurs- day and they agreed a solution must be' sought through the United Nations. "Only if we fail might other action be considered." He said this was not a time for historical judgments, but for cool heads. "What we are trying to do first is get rid of the crisis at- mosphere." Any lowering of tension should be used as a springboard for reaching perm- anent solutions in the Middle East. Freedom of passage through the Gulf of Aqaba was the cen- Force Urged crisis, but he hoped there would be enough time to work out a solution. - The Straits of Tiran were still jopen and some ships had gone through. He said he didn't know |of any British ships in the area that would try to force the straits in the event of an Egypt- ian blockade. Britain had made clear {ts support of French President de Gaulle's proposal for a meeting of the big four powers (Britain, France, Russia and the United States), but thought it best that jthey meet under the aegis of the United Nations, "But we have not yet re- ceived the green light neces- sary," he said in apparent ref- erence to Russia's silence on the proposal. The position of maritime countries was the same now as it was in 1957, that the Gulf of Aqaba and the Straits of Tiran were international waters with free passage guaranteed to all jin peacetime, is forecast by Fi- jnance Minister Sharp. country. Previously antiques had to be ket power.'" He warned that, chiefly be- For most Canadians, the only|120 years old to escape duty Cause of a decline in produc- \bright spot in the minister's budget speech Thursday night came in a government assault on drug costs. In a_ three- pronged attack, he proposed eliminating the 12-per-cent sales' tax on all drugs, reducing tar- iffs on them and changing their anti-dumping regulations. * The forecast deficit comes on the heels of the actual shortfall of $428,000,000 run up in the last fiscal year. The largest peace- time deficit, $791,000,000, was in 1961-62 when the Conservatives were in office. The 56-year-old minister, pre- |senting his third budget, includ- ing a mini-budget last Decem- ber, defended the proposed def- icit as necessary to give the economy a moderate sustaining force as it passes through a deli- cate transitional period. He also said he is asking again for restraint from busi- * |ness and labor to counter cost }and price increases which would jlead to "increasing inequity and dissension in the country. There were no changes in per-| and, despite the special conces- sion for allergy suffers, there was no indication of general changes in the margarine im- port policy, Mr, Sharp rejected proposals that he lift the special excise tax on television sets, radios, phonographs, jewelry and other opular consumer goods on grounds there were no economic or social gains to be made in them this year. HELPS BUSINESS For business, Mr. Sharp said the government will lift the re- maining six-per-cent sales tax on production machinery imme- diately, instead of next April 1 as previously planned. There no longer was a need to restrain capital spending by business, and ending the tax-- it was established duction costs. tivity, the economy is likely in for a "modest" increase in un- jemployment, but a generally jforecast upturn in economic conditions later this year should cancel that by 1968. A possible trend away from the traditional dependence on annual budgets was suggested. Experience during the last 18 months had indicated that a new. flexibility was available in dealing with fiscal matters. With Parliament sitting more or less continuously, it could move promptly to enact needed measures without having to give the government extraordinary standby powers. The minister called the Car- ter report on taxation "thought- ful, radical and stimulating" but said it bristles with technical and political problems. subject of bitter criticism since WHITE PAPER DUE in 1962-- would help reduce future pro- Repeating his previously an- \nounced plans to publish a white |paper on government thinking The 11 - per - cent sales tax|on the report this fall, followed on building materials, however, |by legislation in 1968, he warned Arab enemies began. UAW Would tre of the problem. 'Without that. we plunge: rapidly back into a crisis situation." Mr. Wilson said there had been no real defusing of the was maintained because it|that too much time cannot be peaceful shipping, he said. Fa ; would be too expensive to lose |left for study. He declined to comment on | British arms. shipments to the -- ee \TAX LIFT: SEPT. 1 the revenue. It brought in more) Taking time to: study the re- Middle East saying such ship- (gi | The proposed lifting of the 12-/than $200,000,000 last year, jport caused uncertainty, which ments were never _ discussed - jper-cent sales tax, applied at That tax was maintained at/could not be avoided. It was a publicly. He also declined to jthe manufacturers' level, would/the 11-per-cent level Tast Decem-/reason for pressing head as sonal or corporate income taxes. South Vietnamese Force ~~ Kills 150 Of Viet Cong SAIGON (AP)--A 1,000-man force of South Vietnamese par- atroops and infantry chopped up a Viet Cong battalion just south of the demilitarized zone today and killed at least 150 Viet Cong, the Vietnamese com- mand announced. A few miles to the west U.S. marines were calling in air and artillery against a bunkered Communist ridgeline where dug- in North Vietnamese regulars killed 13, marines and wounded 63 Thursday. The fighting raged a few miles below the 17th parallel dividing Vietnam, an area where the Communists have shown every willingness to feed in fresh troops for a growing war of at- tribution. The South Vietnamese jumped off on a widespread sweep at dawn and within hours hit the guerrilla battalion of about 500 men in a coastal area of sand Russia, China Closing Ranks TOKYO (Reuters) -- Co-oper- ation between Russia and China in the Vietnam war has been intensified, a senior Japanese official reported today. Osamu Kaihara, chief of the defence agency secretariat, told the governing Liberal Democra- tic party's security affairs re- search council that a consider; able quantity of relief supplies recently reached North Vietnam through Soviet - Chinese co-op- eration. Kaihara also told the party group that China was still sev- eral years away from being able to use nuclear warheads. dunes, low hills and brush where it has long operated. The battle northeast of Quang Tri City was the third in the area in the last two weeks. COMMAND RIDGELINE To the west, the marines were attempting to dislodge the North Vietnamese from a low ridgeline that gives them ob- servation of Con Thien and Camp Carrol, two bunkered marine outposts just. below the demilitarized zone. Serious fighting was reported in the Mekong Delta, where the Viet Cong mortared the provin- cial capital of Tan An 23 miles from Saigon. The Communists early today shelled a camp holding defec- tors, killing one and wounding 28. They followed with a small ground assault which was beaten off. A U.S. platoon caught the fleeing guerrillas about a mile away. An eerie night battle broke out in the paddy fields. At dawn 17 Communist dead were found. Four of the Amer- icans were wounded. Toronto Exchange Trading Sharpens TORONTO (CP) -- The Tor- onto Stock Exchange displayed another burst of strength in morning trading today, raising hopes that the market may be breaking out of a four - week slump, The industrial index climbed 54 to 163.23. Analysts said the continuing rise was influenced more by the advance at New York rather than reaction to Finance Minis- ter Sharp's budget. Aad Three DeGaulle Canadians DETROIT (AP) Unless Chrysler Corp. commits itself to Sounds pay wages in Canada equal to those paid in U.S. auto plants, the United Auto Workers union Proposes to add three Canadians to its nine - member U.S. bar- gaining team. UAW President Walter P. Reuther has said wage parity for Canadians is an essential to any new contract negotiated this year with any of the automotive big three -- General Motors, Ford or Chrysler. He has said he wants to win a commitment on equal pay in both countries in U.S. bargain- ing before moving to Canadian subsidiaries of the big three, and he fears government regu- lations might thwart Canadian strikes to achieve that goal. Reuther speaks today to the union's Chrysler council, which decided Thursday to add three Canadians to its bargaining team in Chrysler refuses to commit itself on parity. BARGAIN IN JULY New contract bargaining be- tween the UAW and the big three begins in early July in the United States. Canadian bar- gaining comes some_ two months afterward. A spokesman for the union said today the names of the three Canadians won't be known until July. The names may not be released until the union finds out whether the Chrysler nego- tiators are willing to bargain simultaneously with the Cana- dian representatives. Warning PARIS (AP) -- President de Gaulle warned today that any nation which opened fire in the current Middle East crisis would have 'neither the approval or support" of France. He repeated his call for the United States, the Soviet, Union, Britain and France to seek agreement on how the crisis should be resolved. Britain and'the U.S. have ex- pressed interest in the idea but the Soviet Union has cold-shoul- dered it. De Gaulle's statement, made at a regular cabinet meeting, was given to reporters by the cabinet spokesman. De Gaulle added that in comment on what other action would be taken if the United | Nations was unable to keep the straits open. On other aspects of British foreign policy Mr. Wilson said the problems of Vietnam and Rhodesia had not been forgot- see ro the present Middle East crisis. PRIME MINISTER Wil- son of Great Britain, using hands and pipe, provides an interesting camera study in these pictures taken in Ot- tawa Thursday night. --CP Wirephoto take effect Sept. 1 so druggists|ber, when the general sales tax|quickly as possible -- but not could get rid of existing stocks|Was raised by one shied 3 justification for haste. on which the tax already has been paid. help make sure the savings are passed on to the public, Mr. Recent civil disorders in Hong Kong had not affected the sta- tus of the British colony and the situation had settled down, he said, thanks to the restraint shown by police and the admin- istration. Chinese Gunboats Scare Investors HONG KONG (Reuters)-- Gold prices rose sharply on the Hong Kong market today fol- lowing rumors that Chinese Communist gunboats were cruising outside the colony's territorial waters. British authorities denied the reports, which appeared in left wing newspapers. Market sources said a flurry France's view all the states in| the Middle East have "'the right} to live." | But, he went on, "the worst| thing which could happen would) be the opening of hostilities." | "In consequences, the first state which would employ arms anywhere would have neither its (France's) approval -- nor,| for greater reason--its support." De Gaulle said that if the present situation could be main- tained and a relaxation of ten- sions brought about, the prob- lems of navigation in the Gulf of Aqaba, the Palestinian Arab refugees and the relations among the neighboring states "must be completely settled through international decisions," WOULD AVOID TEST STRENGTH Washington Seen Optimistic DEPEND ON DIPLOMACY WASHINGTON (AP) -- U.S. leaders are reported hopeful a way can be found out of the Israeli - Arab crisis without a test of force against Egypt's anti - Israeli blockade of the Gulf of Aqaba. A review of the war-threaten- ing situation in the Middle East and planning for future develop- ments were scheduled in a White House conference. be- tween President Johnson and British Prime Minister. Wilson. Wilson, following a brief visit White House in late morning for day-long talks with Johnson. Vice - President Hubert H. Humphrey, State Secretary Dean Rusk and Defence Secre- tary Robert McNamara told congressional leaders Thursday the United States is trying for a diplomatic settlement ahead of a test of force. Humphrey, when asked about reports the United States and other maritime powers are plan- ning to use a naval force in the gulf, told reporters: "T have not heard of any such considerations." Rusk said: 'I don't want to get into any question of uni- lateral action." They were reported to have shown the congressmen one pro- posed declaration on freedom of shipping which said that signers would assert right of passage through the gulf on behalf of all shipping serving under their flags. UNLIKELY TO ACCEPT This version did not mention specifically the right of Israeli- flag ships to navigate the gulf, however. One top official said Israeli would be unlikely to ac- cept a declaration which did not pop its gght to ship through Humphrey played down the additions of Soviet warships to its Mediterranean force. An important element in the U.S. hope that forcible action will prove unnecessary is the Soviet attitude. U.S. officials say as a result of exchanges with Soviet author- ities they believe the Soviet gov- ernment is interested in avoid- ing war in the Middle East Al- though it is supporting Egypt President Nasser's general posi- tion against Israel. The assumption here is that the Russians have advised some restraint in Nasser's actions. Of- ficials note the Russians in sup- porting thé Arab position in pub- lic statements and at the United Nations have avoided all-out en- dorsement of Nasser's declared blockade of the Gulf of Aqaba against Israeli shipping. of nervous buying was a direct result of the rumors. Gold prices went up by 4.5 Hong Kong doltars about $1 a tael (1.2 Troy ounces). Hong Kong has been in a state of anxiety for the last month as riots and threats from neigh- boring China grew out of labor Arab Editor Sees Israeli Friction CAIRO (Reuters) -- Moham- med Hassanein Heykal, editor of the authoritative Al Ahram and a close personal friend of President Nasser, claimed today that Israel is on the verge of internal breakup because of -dis- sension between the military and government leaders over the current crisis. In an article, Heykal said that unless Israel breaks.the Arab blockade of the Gulf of Aqaba "she will break from within." Heykal said a state of' "boil- ing and dissension" exists in Israel between official power represented by. Premier: Levi Eshkol and moderates on the one hand and the Israeli mili- tary organization, represented b the armed forces staff, intelli- gence services and other mili- disputes here. tary institutions. Sharp said. He told a later press confer- ence, however, that the govern- ment has no way of controlling prices. But the government would be keeping an eye on the situation, and he was sure other groups would be too. The 12,000-word speech, run- through in a faster-than-usual 80 minutes, offered little else to the public, The duty on_ tequila was | halved, antiques 100 years old} German Seaman Faces Spy Charge MANCHESTER, England (AP) -- Magistrates court to- day handed German seaman Peter Dorschel, 26, over to Scot- tish police to face charges of espionage at Dunoon, near the American Polaris submarine base in the Holy Loch. Dorschel, who lives with his wife's family at Prestwich, Lan- cashire, was charged with incit- ing another person to obtain information contrary to the in- |terest of the state. President Johnson and Australia's Prime Minister nesday during a walk in the @ LB] CONFERS WITH PRIME MINISTER HOLT White House Rose Garden, Holt came to Washington for, conferences on problems in point. The budget also extended a used by auto parts makers. Mr. Sharp, who went through his speech as calmly as though he were addressing a service club luncheon, made it clear, however, that the economic im- plications of his udget were uppermost. He told his post-speech press conference that fhe economy now is at the end of a rapid expansion period. The problem was to make the transition from} unsustainable spending to a) steady rate of growth. FORECASTS PRICE RISE Mr. Sharp told members fis jrecommendations on tariff Changing the tariff and anti-|99-per-cent drawback on duties/changes were few, and they dumping rules would open the|now given on automotive pro-/would not be implemented until way to more competition.,and| duction machinery to machinery/detailed results of the recently concluded trade talks at Geneva were made known. That was expected about July 1. Then the thousands of tariff changes that would be needed to fulfill Canada's commitments at the talks would be presented. At the same time, he pledged government help for industries seriously affected by tariff con- cessions made by Canada in the negotiations. He gave no details. TO LOSE MONEY Mr. Sharp said his two ma- jor tax changes -- lifting the He told the Commons that the chief obstacle to stable growth! during the next few years is the| danger of excessive increases in| prices and costs. | He rejected formal wage and| price guidelines because of practical problems involved, but said there is "great value" in mobilizing public opinion behind sales tax on drugs and on pro- duction machinery--would ccpt the government about $82,000,- 000 in revenue in the coming year. The drug sales tax would amount to $22,000,000, but should produce savings even greater than that for the pub- lie, PARIS (CP) -- France plies to any country that sta East. In a policy statement, France's strict neutrality in warned that whoever started French approval. Greyhound Bus Dr tested proclaiming '"'On Strike, Amer Lawyer Fined For REGINA (CP) -- Dr. M during a murder trial in Y day. the Far East and the Middle East. S uid AA ALA (AP Wirephoto) |i 2ngn tt TMM ur .. In THE TIMES Today .. Oshawa Steelers Win New Arts Centre Donated For City--P. 9 Need Changed Attitude Toward Mental Sickness--P, $ Ann Londers--10 Ajax News--5 City News--9 Classified--16 to 19 Comics--14 Editorial--4 Financial--15 5 Obituaries--19 EANTTHTU TMT Te TUMTTTE TMNT Greyhound Bus Lines Ltd. and Toronto waiked off their jobs at midnight Thursday in line with what they claim is an Ontario-wide strike. Picket lines were set up by Windsor drivers who pro- "unfair labor practices' and by London drivers, ticket agents and baggage clerks who carried placards NEWS HIGHLIGHTS France Threatens To Cut Off Arms today issued what was con- sidered to be a warning that it would cut off arms sup- rted hostilities in the Middle President de Gaulle declared the present crisis. He said both Israel and the Arab states had the right to live, but the shooting would not have ivers Strike drivers in Windsor, London icans are taking our work." Contempt . C. Shumiatcher, prominent Regina lawyer, has been fined $2,000 for contempt of court orkton, Sask., last October. Appeal action has been launched, it was learned Thurs- Ma Home Debut--P. 6 Pickering News--5 Sports--6, 7 Television--14 Theatres--13 Weather---2 Whitby News--5 Women's---10, 11 { 0