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Served By Leased Wire Of The ' Jim ^ i ^ "-! ASSOCIATED PRESS Ijj , +++4^1+*, £2 4_ STAR . NEWS^CIRCDLATIOII With Complete Coverage 01 > Yjl [1 1 rT F* Yesterday....;. 18,268 State and National News 4 4^ 4^ ^ ^ Same Day Last Year. 14,255 VOLjlr^0‘ 2—__WILMINGTON, N. C., TUESDAY, AUGUST 5, 1941 FINAL EDITION ESTABLISHED 1867 Russians Encircled In South _ — * SHIFT FROM SMOLENSK flev “Doomed” Claim Ger mans Reporting Successes 0n All Battlefronts By the Associated Press BERLIN. Tuesday, Aug. 5.—Ger Bjn sources reported early today (hat Nazi columns were fighting en circle(j Russian troops south of Kiev jn a battle of annihilation "now in {Ull swing” and paralleling destruc t!on of soviet forces near Smolensk. They pictured the weight of the German offensive as having shifted from the Smolensk area, where Rus sian resistance was declared to have been broken, to the Kiev sector, where the high command said Red troops were isolated from railroad supply lines. In the drive on Leningrad, Ger man pressure on Soviet forces was increasing, a military spokesman said. Portions of two Russian units were said to have surrendered to en circling German troops northwest of lake Peipus, on the Estonian fron tier. Russian railroad communications bare been cut by German and Hun arrian troops thrusting deep Into .‘he Ukraine toward Kiev, it was of ficially declared today, and along the central front the bulk of a ma jor Red force defending tne Moscow approaches has been destroyed in a trap east of Smolensk. Surviving units of the Soviet army in the Smolensk theatre, it was add ed, face dissolution. Command Announcement These parallel but far-separated victories were announced by the Nazi high command in a communi que which pictured the Russians as suffering disaster on two of the three major areas of the front. As to the center, however, it was soneeded that despite the demolition of another major obstacle on the way to Moscow the bitterly resisting Russians might be able to organize still other defenses before the city. South of Kiev, where German tank units were declared io have broken down the Red defense lines to burst out into the flat, open coun try, a battle similar to the Smolensk action appeared to be developing. The primary objective in each in stance. it was statde, was the same: to destroy the Russians rather than to push them back. Thus in the Ukraine German ac counts indicated that encirclement (Continued on Page Three; Col. 7) GERMANSSMASH ALONG NEW FRONT Red Armies Fight Desper ately to Stop German Triangular Wedge (By The Associated Press) MOSCOW, Tuesday. Aug. 5.—The Red army, battling bitterly against a double drive into the Ukraine, re ported 'today the Germans have smashed another triangular wedge into the northern flank of the front halfway between the Smolensk sal tent and Leningrad. The Moscow war bulletin declared fierce fighting had developed in the vicinity of Kolm, easternmost point °( a triangle based on Pskov, 100 miles northwest, and Polotsk, 100 miles southwest. Kolm, little town in the marsh lands 0f White Russia, is 70’miles eeper into Soviet territory than • ov°rzhev, where fighting in this sejtor pas reported last week. Red army said the fighting continued jn the Smolensk salient tn" near Eel Tserkov, southern arm Continued on Page Three; Col. 3) WEATHER „ forecast rvlf,,1 Carolina and South Carolina: thanfl r?l)'e cloudiness with scattered R'edno* °"ers Tuesday and probably ‘"day; moderate temperatures. ,,JBy C. S. Weather Bureau) tndW^cal data for the 24 hours S 7:.j0 p. m. yesterday). 1.7. Temperature Si."","' m- 79; 7:30 a. m. 81; 1:30 p. m. ®iim -?. m- 81: maximum 87;. mini ’ Wean S2; normal 79 ] 7j, Humidity Rl-j.7„ m- 87; 7:30 a. m. 82; 1:30 p. m. ’ 1 -W 1). m. SO. Total'* Fcecipitation >. m nJ.°r tlle -4 hours ending 7:30 Rx mfS “* to u. st an<i Geodetic Survey). R’llmington / High Low gton- 8:00a 2:52a •flsonhne„ r . 8:38P 3:08p snt>oro Inlet- r, :50a 11:58a * binrisp *..... 6.29p p ,:54P: moonset’3:45na6et 7:°®P; moonriSe " m'"t«d5 ?e.?^ayett"i,le “ " fcwit,"u*d on Page Four; Col, 2) STEP UP, LADIES, WHILE THEY LAST!—With the government suddenly freezing all raw silk.processing and the supply cut off from Japan, silk stockings seem destined to be definitely on their way out in these U nited States “for the duration”. Not one to be caught wearing coarser hose if she can help it is the American woman, millions of whom, from all accounts (Wilmington ladies included) stormed hosiery departments of stores yesterday. T*he above photo was taken in a large New York department store and gives a pretty good idea of what the store manager meant when he said it was “worse than Christmas buying!” GEN. CRAWFORD REMAINS AT CAMP Maj.-Gen. Frederick Smith Assumes Duties As AA Center Commander Brig.-Gen James B. Crawford will remain at Camp Davis and will be in direct charge of the iraining program, Maj. Gen. Fred eric H. Smith, his successor as post commander, said yesterday. “I am very much impressed with Wilmington and the cordiality of its people.” General Smith said. “Mrs. Smith jnd I are looking forward with a great deal of pleas ure to a very delightful duty here. This is my first duty in this state and my first trip to Wilmington. Since I have always planned to live in the peninsular country of Virginia, I’m glad to get back to a place where the atmosphere is so similar,” he said. General Smith arrived here Sat urday from Birmingham, Ala., where he formerly commanded the Seventh army corps. As he takes command of Camp Davis, the post has passed t h e 18,000-man mark toward its au thorized strength of 20,000 troops. Training programs are now under way in the anti-aircraft, sea coast artillery and barrage balloon units. Ickes Hails Gas Curfew; City Operators Dubious WASHINGTON, Aug. 4.— <A>) — Secretary of the Interior Ickes de clared today that Atlantic coast gasoline dealers had entered into the sales curfew with “enthusias tic” approval and some outside the emergency area had sought to join the program. After the first night of the gaso line sales blackout in 17 states and the District of Columbia, Ickes ad mitted there were instances of non compliance, adding^ “these cases will be followed up.” But on the whole, he said in a statement, last night’s compliance was “very satisfying.” In the same statement, however, he again warned motorists that unless they curtailed the use ol motor fuel voluntarily, more dras tic steps would be taken. He gave no hint of what these steps might be. Thousands of filling stations clos ed their gasoline pumps at 7 p. m. yesterday for 12 hours. Oil admin istration officials here admitted the records of yesterday’s sales throughout the affected area prob ably would show a spurt because many motorists loaded their tanks in preparation for the nightly cur few. Nevertheless, they expressed the hope that in two or three days, with drivers kept constantly re minded of the threatened shortage, sales would begin to taper off and finally reach the goal of a one third reduction from normal. Ickes said the motoring public had not yet realized the necessity of reducing gasoline consumption, and reported “many cases in which drivers did not cooperate with the spirit of this undertaking.’’ He said the restricted hours ap-. parently had little effect on em ployment of filling station opera tors. He added, however, the pro gram would cause savings in elec tricity and reduce wear and tear of equipment. Meanwhile, Price Administrator Leon Henderson asked the oil re finers to stabilize prices on Penn sylvania grade neutral lubricants, the highest type of lubricating oil refined from Pennsylvania grade crude. He requested that prices be bas ed on 33 cents a gallon for the dominant grade and that current price differentials on the other grades of neutrals be maintained. In recent months refinery prices have soared from about 22 cents a gallon to 45 cents and higher. Little Local Enthusiasm Insofar as could be ascertained in a check-up yesterday and last night, all New Hanover county and Wilmington gasoline service sta tions were complying with the (Continued on Page Three; Col. 1> British Report Axis Tobruk Force Weakened CAIRO, Egypt, Aug. 4.—(S’)—The war in the Mediterranean, left to take a routine course when the Germans turned from the battle of Crete to an invasion' of Russia, showed signs of rousing today. The British declared the Axis has relaxed its siege lines about Tobruk and reported heavy aerial onslaughts on numerous objectives, while the Egyptians acknowledged many cas ualties from wide Axis raids on the Suez Canal area and the Delta of the Nile. The Middle East command said British patrols, which have been making nightly raids deep into the Axis lines about Tobruk, cut off on the land side now for 113 days, re cently had been unable to make con tact with their enemy. The Axis forces have been withdrawn from their forward posts at night, it was said. - Commission Authorizes Sale Of School Bonds A resolution providing for the issuance of $500,000 in bonds was adopted and an order to sell the bonds to finance new construction and improvements of school^ was approved at a meeting yesterday of the New Hanover county board of commissioners. The bonds were authorized in a special election July 15 to finance improvements and new construc tion to meet an anticipated in crease in school enrollment of 1> 000 new students whose families have moved to the locality be cause of defense and related proj ects. The bonds will be sold under the supervision of the Local Gov ernment commission at Raleigh under the direction of W. E. East erling, secretary. The county commissioners der cided that sealed bide would be received until 11 a.m., E. S. T., August 26, by the commission for sale of the bonds. The bonds will be in $1,000 de nomination dated Sept. 1, 1941, ma turing “annually March 1, $10,000 1944, $10,000 1949, $20,000 1946 to 1964, and $25,000 1965 to 1968, all inclusive, without option of prior payment.” The bonds will be of thg coupon type and will be registerable as to principal alone. Delivery will be about Sept. 8 at the place of the purchaser’s choise. There will be no auction. Bidders are being requested to name the interest rate or rates, not exceeding six per cent per annum, in multipls of 1-4 -of one per cent. Each bid may name one rate ^r part of the bonds (having the earliest maturities) and another rate for the balance, but no bid may name more than two rates, and each bidder must specify in his bid the amount of bonds of each rate. The bondr will be awarded to (Continued on Page Four; Col. 7) COUNTY’S BUDGET NEAR COMPLETION Commissioners to Meet To morrow for Further Con sideration of Item The New Hanover county board of commissioners, with arrange ments on the sale of $500,000 school bonds taking up a major portion of yesterday’s session, decided to meet again tomorrow morning at 9 o’clock. At that time the officials will further consider the county budget for the current fiscal year which began July 1 and will end June 30 next year. County Auditor J. A. Orrell re ported yesterday to the ' commis sioners that the county has $181, 743.48 in cash on deposit and that the sum is secured by $191,000 in securities held by banks in which the money is on deposit. In the Wilmington savings auu Trust company is $82,598.11, the' auditor reported. Deposited with the People’s' Savings Bank and Trust company is $79,144.57 and in the Morris Plan bank is $20,000 of the county’s money. Schaol Request Granted The request of H. M. Roland, county school superintendent, for the placing to the credit of the board of education funds for Au gust was granted by commission ers. • For general control $300 will be used, $5,000 for plant mainte nance and $500 for the book fund. These expenditures are in the reg ular budgetary requirements. Supplemental expenses for the month included $1,500 for instruc tional services and $2,000 for the building fund. (Continued on Page Two; Col. 3) HOUSE VOTES RECORD TAX; UNITED STATES TO PROVIDE ECONOMIC AID TO RUSSIANS RENEW AGREEMENT * Soviet Expected to Buy Heavily On American Marts Following Pact WASHINGTON, Aug. 4—W—1The United States gave Russia a for mal undertaking tonight to supply “all economic assistance practi able” to strengthen Soviet resist ance to Nazi Germany. In an exchange of diplomatic notes, connected with the renewal of the annual Russian-American trade agreement, the United States informed the Soviet union that is is: 1. Extending “priority assist ance” to Soviet orders for urgently needed materials “upon the prin ciples applicable to the orders of countries struggling against ag gression.” 2. Issuing unlimited licenses per mitting the export of “a wide variety of articles and materials needed for the strengthening of the defense” of Russia. 3. Giving “favorable considera tion” to Russian requests for the extension of available American shipping facilities to expedite the delivery of goods to Russia. No Minimum Under the renewed trade agree ment, no minimum figure was given for Russian purchases in the United States. In . the expiring agreement, Russia undertook to buy at least $40,000,000 of goods here but actually greatly exceeded this figure despite American ex port control restrictions. The United States granted most favored-nation treatment to Rus sian commerce; that is, it agreed to give Russian trade favorable treatment as is accorded to any other country. Trade between the two countries in the coming-year, the new agree ment stated? “will be governed largely by the defense needs of the United States and of the Soviet union and other countries strug gling against the forces of armed aggression, rather than by the The United States expects to buy usual commercial considerations.” The United States expects to buy strategic devense materials from Russia. The new trade agreement was overshadowed in importance by (Continued on Page Three; Col. S) WALLACE TAKES UP DUTIES HP City’s First Municipal Man ager Asks Cooperation Of All Citizens The cooperation of all citizens was invited yesterday as James G. Wal lace, declaring his intention to dis charge his duties as efficiently as possible, arrived from Bangor, Me., and assumed the city managership of Wilmington. The new official conferred first with Mayor Hargrove Bellamy in the office Mr. Bellamy has used, but which will in the future be occupied by Mr. Wallace. Promises Best Effort "At this time,” he stated, “I can not make any definite declaration of policy. I shall have to familiarize myself with our personnel and the problems with which we are con fronted. All I can say now is that I shall do the best I can to discharge my duties efficiently, and I urgently request the cooperation of all our citizens." "I have been very favorably im pressed by Wilmington and its citi zens,” Mr. Wallace continued. “It is a beautiful city, and everybody I have met has been very cordial (Continued on Page Four; Col. 7) State Department Commander Lauds Patriotic Legion Aims Wilmington Post No. 10, Ameri can Legion, inaugurated a drive to increase it; membership to 700 at a meeting held in the Sorosis hall last night, with the principal address befng made by Roy L. McMillan of Raleigh, state depart ment commander. Commander McMillan praised the officers and members of the local post for their accomplishment is increasing membership from 227 to 507. This expansion, represent ing an enlargement of approxi mately' 213 per cent, was among the best in the country, he said. Outlining the background and ob jectives of the Legion, Command er McMillan termed it the “great est patriotic organization in the history of fee world.” The back ground of the American Legion is the American fighting man; al ways military, never militaristic, he continued. The purpose of the Legion, he said, is community service, youth activities, veteran activities, and the promotion of Americanism, "the only ism for which there is room in America.” Strange Presides The meeting was opened, Post Commander Robert Strange pre siding, with the advance of the colors and a prayer by the post chaplain. j Wilbur R. Dosher, chairman of the membership committee, intro duced Henry L. Ingram of Ashe boro, general organizer and state head of the “Go Getters,” a desig nation conferred upon members ! (Continued ou Page.Four; Col. 2). H fc i"T '. Defense Highway Bill Vetoed By President WASHINGTON, Aug. 4. — (jj>) — President Roosevelt vetoed today a $320,000,000 defense highway bill, ob jecting that its provision for distri buting $125,000,000 to correct "criti cal deficiencies in lines of strategic networks of highways nad bridges” on the basis of population, area and other factors "entirely disregards” the interest fo national defense. “The critical deficiencies in high ways and bridges that may require prompt correction in the interest of our natonal defense cannot be rea sonably related to the population of states or the other factors which en ter into ordinary apportionment,” the Fresident said in his veto mes sage. He said also that there were “other provisions of this bill which raise questions of public policy or depart from established practice.” The bill provided $150,000,000 for roads giving access to military and naval reservations and defense plants and $25,000,000 for damage to local highways as the result of military maneuvers. Sentor Thomas (R-Idaho) of the Senate Roads committee said an ef fort would be made to revamp the measure to meet the President’s ob Marine Parachutists In Onslow Maneuvers JACKSONVILLE, Aug. 4.— UP)—Several thousand soldiers and marines landed on Onslow beach today, parachutists la id ed three miles inland, and tanks, armored cars and little scout cars and other mobile equipment were brought ashore by men in landing boats. It was the start of joint train ing maneuvers, and on hand were Gen. Holland M. Smith of the Marine corps and several high army officers. Engineers placed three pon toon bridges across the In land waterway, over which troops and equipment started moving inland. About 35 boats were anchor ed from six to 20 miles at sea. jection and still take care of the "acute highway financing situation in western public lands states.” The 13 public lands states would have been allowed to contribute less than 25 per cent toward the cost fo stra tegic roads while other states would have had to contribute 25 per cent or more. Powerful British Navy Units Move Into Orient By RELMAN MORIN SAIGON, French Indo-China, Aug. 4.—UP)—Unofficial,- unconfirmed, re ports circulated in Saigon tonight that a British naval squadron, in cluding the 30,600-ton battleship Warspite, had been sighted in the Gulf of Siam, coinciding with known British measures to strengthen the land and air defenses of Malaya. No confirmation of the Warspite’s presence in Far Eastern waters was obtainable from any official quarter, but the report, if true, would mean that for the first time in many years the British navy has sent a capital ship east of Suez. Augments Force Britain has considerably aug mented the forces defending Singa pore, the Malay peninsula and Bur ma recently and thousands of tough Australians and Indian troops are reliably reported to have been moved in recent days to the Malaya bor ders with Thailand. This is believed to be in prepara tion against any Japanese thrust into that country from new Japanese bases in southern Indo-China. The RAF also has strengthened its Bur mese posts, near Thailand. A Japanese aircraft carrier and a submarine arrived at Saigon today and more thousands were reported en route. Roads from northern Indo China were clogged by long lanes of trucks carrying Japanese troops, equipment and supplies toward the Thailand frontier. American business firms prepared to transfer management of their local offices 'to French states and sending American employes home on the first ships leaving Saigon. About 100 Americans remain in southern Indo-China, but two-thirds of them are expected to leave before the end of the week. MacArthur Consolidates All Philippine Forces DEFENSE TALK IS HEARD BY P.-Tl. Director Outlines Duties of Members in National Pro gram Before Institute CHAPEL, HIEI,, Aug. 4.—LT)— "You members of the Parent-Teach ers association have a double duty in national defense in that you may serve not only as plain citizens but also as representatives of the schools of this state,” Ted S. Johnson, direc tor of Civilian Defense for North Carolina, told delegates to the 14th Annual Parent-Teacher Institute at its opening session here tonight. “It is your duty,” he said, “to keep the home, the schools, and the public in your respective communities in formed as to what North Carolina is doing and plans to do for national defense. “It may sound fantastic to you, but it is a very real part fo our pro gram to prepare North Carolina for conducting black-outs, building air raid shelters' and other forms of home-defense — just in case,” Mr. Johnson declared. Following the invocation by Har ry F. Comer, secretary of the Uni versity Y. M. Q. A.. Controller W. D. Carmichael, Jr., extended greet ings. The response was made by Mrs. J. S. Blair, of Elizabethtown, president of the State Congress of Parents and Teachers which, with the cooperation of the University, is sponsoring the institute. Mr. Johnson said there are three classes of civilian defense, namely, 1—primary defense program which includes the buying of government bonds and making loans and contri bution; 2—civilian protection which includes the preparation for air raid shelters, black-outs, and other home defense; and 3—the development of morale and efficiency among the jCivilian population. * MANILA, Aug. 4.—(#)—Swift con solidation of Philippine armed forces under Lieut. Gen. Douglas A. MacArthur, commanding the United States Army in the Far East, was augmented today by steps designed to strengthen do mestic preparation of the islands for any emergency. Announcement that the Philip pine Air corps hereafter would be known as the air force of the Far Eastern command was followed quickly by action of President Man uel Quezon in authorizing promo tion of 52 Philippine army officers, including three to be colonels. The advisability of stationing guards at all oil tanks and other fuel storage facilities to prevent sabotage was considered by the Civilian Emergency administra tion. Two thousand additional Con. stabularymen will be moved into Manila, bringing the total in this area to 4,000. • (President Quezon recently warn ed eight Socialist mayors that stern reprisals would follow any disloy al actions by their followers. Of ficials are concerned over the pos sibility that hostilities might pre cipitate Socialist attempts to gain control in districts of central Luzon where they are strongest). Mania’s recent blackout, the practice evacuation of a slum dis. trict Sunday, the mining of Manila and Subic bays, incorporation of Philippine forces into the U. S. Army and heavy reinforcements of the latter, especially the air arm, have combined to emphasize the seriousness of-the situation and to give evidence that the islands will be fully prepared. JAPS SUSPEND SERVICE TOKYO, Aug. 4.—UP)—All regular direct Japanese steamship service with the United States has been sus pended, it was reliably reported to day, and an all-out economic, indus trial, political and social mobilization to counter United States and British pressure is likely to come next week. ' 3 BILLION MEASURE Early Senate Approval 1$ Forecast As Administra tion Given 369 Votes (Tax Chart on Page Five) WASHINGTON, Aug. 4.—W*-Th4 stiffest tax bill in the nation’s his tory, designed to raise about $3, 206,200,000 to help finance the de fense program, was passed by ths House late today by an overwhelm ing majority, after being stripped of a provision requiring married persons to file joint income tax returns. The measure, which now goes to the Senate, would virtually triple the taxes of persons in the lower and middle income brackets and would tap the nation’s busi ness firms for an additional $1, WASHINGTON, D. C., Aug. —(/P)—All North Carolina mem bers of the House of Represen tatives votes for the tax bill to day. - _ 332,900,000 through surtaxes and more drastic excess profits taxes. It went through by the to-heavy roll-call vote of 369 to 30. Elimination of the joint return provision lopped about $323,000,000 from the bill’s originally estimated yield. (By filing separate returns, married couples sometimes pay lower taxes because of lower rates. This is especially true in the nine community property” states, where a husband and wife can add up their incomes, split the sum in half and each report half for income tax purposes.) FDR Asked Modification President Roosevelt had ap pealed for modification of the joint return provision to exempt earned income from such returns. He also had asked two other last-minute changes, which would have low ered the income tax exemptions» and altered the excess profits tax plan, but the House was unable to consider these under the parlia mentary procedure it had adopted. Members of the Ways and Means committee and other legislators warned the House that elimination ,of the joint return would inevita bly mean higher individual income taxes to compensate for the loss. On the other hand, opponents of the provision contended it was a blow at women’s rights, that it wgs unconstitutional and unfair. Spokesmen for the community property states declared some of those states such as Texas and California had had community property laws ever since they were admitted to the union. Just before the vote on final passage of the bill, Rep. Crowther iR.-N. Y.), offered a motion to recommit the measure to the Ways and Means committee with instruc tions to amend it so as to recoup the lost revenue, but the motion was defeated on a voice vote. Graduated Surtaxes As it passed the House, the bill would raise about $829,000,000 from individuals through a drastic sys tem of graduated surtaxes start ing at the first dollar of taxable income. They would range from 5 per cent to 75 per cent, the latter rate applying to income over $5, 000,000. The present normal tax rate of four per cent was un changed but under the new plan a married man with no dependent* and earning $2,500 would pay a (Continued on Page Two; Col. 3) VICHY TO DENY FUTURE DEMANDS Will Not Accede to Axis Occupation of Empire In North Africa VICHY, Unoccupied France, Aug. 4. — UP) — Authorized sources indi cated tonight that France would re fuse to grant the Axis military fa cilities in North Africa such as Japan got in Indo-China even if Vichy considered the North African territories menaced by attack. TJiis indication was contained in a statement to correspondents in answer to a statement by United States Acting Secretary of State Sumner Welles Saturday that the United States attitude toward Vichy would be determined by "the effec tiveness with which France defends its territories against the Axis powers' aggression." The Vichy statement reviewed dif ficulties in sending reinforcements to Indo-China which led Chief of State Marshal Petain to accept (Continued on Page Three; CoL 4k (
Wilmington Morning Star (Wilmington, N.C.)
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