6/8/70

KISSINGER, HENRY A./NEWS.CLIPPINGS

# People of Cambodia, Forlorn Army Of Nation Remain Serene in War

*Continued From Page One*

Into their shirt collars, pant waists and boots. The leafy recruits are racing to and fro, periodically diving to the ground under simulated attack.

The young men exude confidence, if not competence. "We are ready for the Vietcong," says one diminutive warrior with a three-foot tree sprouting out of his left boot. "One Cambodian soldier is a match for three Vietcong," says a second clump of foliage.

At the mess hall, rice is cooking in several giant vats. One is uncovered and is immediately blackened by a blanket of flies. "Ah, the flies, the miserable flies. I make war against the flies, but always I lose," says Lt. Col. Leng Saroun, the camp doctor and an unlikely character even for the Cambodian army. The colonel gives visitors a guided tour of his flower garden on the base, all the while reminiscing about better days in Paris at the Follies Berbere. He complains that his garden is harassed by hungry cows and stunted by lack of water supply.

Indeed, there's no running water anywhere on the base. There's no electricity either. Nor is there telephone or radio communication between the base and Phnom Penh, about 70 miles to the southeast; urgent messages must be sent by train. Aside from Col. Lao Vacal's prized Jeep and a baby blue Mercedes, there are only three operative motor vehicles on the base. There are several dozen Chinese, Soviet and American trucks, but all lack engines and other vital parts.

## A Visit to Luong Vek

The real vehicular graveyard is to be found at Luong Vek, the Cambodian army's central supply base 40 kilometers north of Phnom Penh. A sentry along the base's largely unguarded and unfortified perimeter admits visitors, after first riding off on a bicycle to see if the colonel in charge is still busy at siesta. He is not, and he gladly welcomes visitors with a mention of his happy days studying American military logistics eight years ago in Maryland.

Luong Vek, the colonel says, has considerable stockpiles of small arms of varying age and national origins. But there are no comparable stockpiles of ammunition. The base also houses the rusting hulks of several hundred World War II military vehicles, none of which will ever move again under its own power. The Cambodian army has some 400 other operative vehicles, he says but the only operative vehicles to be seen at serene Luong Vek is a bicycle.

The atmosphere is much the same at the town of Saang, 35 kilometers east of Phnom Penh. Saang is on the military front, though

this term seems vaguely inappropriate. Saang also is the scene of the Cambodian army's most impressive victory to date. Vietcong forces, numbered by the Cambodians at several thousand but by most other observers at several score to several hundred occupied the town on the 19th of April. Four battalions of Cambodian troops sat at the edge of the town for five days and finally demolished portions of it with artillery. By this time, the civilian population was long gone and, so it seems, were the Vietcong.

## The Colonel Is Asleep

A week after this victory, Saang was still a deserted town, except for a few dozen soldiers resting in the shade of shell-pocked buildings. The Cambodian military presence had been extended three kilometers east of town, where a bamboo pole was stretched across the road. This unfortified forward line was manned by a platoon of soldiers led by a sergeant outfitted in a sarong and dark glasses. He casually explains that the Vietcong are 300 meters down the road.

This statistic, like everything else in Cambodia these days, is anything but definitive. A major says the Vietcong are 10 kilometers down the road. The mystery might be cleared up by the colonel commanding the area, but he is asleep. It is 10:40 in the morning.

Back in Phnom Penh, life is also serene. Military dress has become something of a public fetish, with Phnom Penh teenyboppers outfitting themselves in khaki shirts and berets, worn with form-fitting slacks and high-heeled shoes and topped off with empty cartridge belts slung low on the hips. Walls are plastered with signs, such as "Get Out Dirty, Aggressive Vietcong, Eaters of Cambodian Territory." And, except at siesta time, the city's parks serve in training grounds for khaki-clad civil servants laboriously learning how to march in step.

More than 400 teachers who have fled in recent weeks from towns taken over by the Vietcong are in Phnom Penh undergoing a two-week combat training course in preparation, they say, for being sent home as "guerrilla commandos." The men are armed with World War I rifles, and they have been promised eight practice shots.

They are dressed in scraps of uniforms purchased in Phnom Penh shops. One teacher displays a rusted knife, apparently with no blade, that she bought for a dollar. "Oh, that is much better than mine," says another. An American questions the effectiveness of these weapons. We will fight fiercely to defend our country," says one teacher. "We will throw the knives at the Vietcong," says the other.

Touch Me, Feel Me,
Grunt, Growl, Purr

by LEO ROSTEN

I have this caustic friend, Rodney, who has this sentimental cousin, Elmer, and they disagree over just about everything. The disagreements are, I should tell you, extremely friendly. That is because each man is mature, intelligent, and thinks the other an idiot.

Rodney once told me that ever since Elmer fell out of his high chair he had suffered from a lopsided cerebellum; and Elmer once confided that Rodney had contracted a virulent variety of mumps at fourteen, which left him parched in the medulla oblongata. "It's pretty tough to go through life with a parched medulla oblongata," said Elmer.

This might have made a deeper impression on me had not Rodney remarked, the preceding night, "Elmer is such a sweet fellow. Sensitive. Idealistic. Heart of gold. Wouldn't hurt a fly-only people, whom Elmer gives the most mush-headed advice since doctors advised patients with worms to rub aloe and honey into their navels."

Politically, the cousins are as far apart as Poles. Elmer thinks Rodney is a reactionary, and Rodney calls Elmer the kind of ninny described by H. L. Mencken as a man who, upon discovering that a rose smells better than a cabbage, concludes it will also make better soup.

I was lunching with Elmer and Rodney at the latter's favorite restaurant, the Ptomaine, when a long-overdue confrontation erupted. It began when Elmer announced that he had changed his entire life and Weltanschauung with an astonishing, uplifting, even revolutionary experience: a group "Liberating Weekend," in the Catskills, at Swami Ishmar Yonklowitz's "Nirvana Sensory-Expansion Sanctuary." Elmer's eyes moistened as he pronounced the name.

"Is that the sort of retreat I saw in the movie *Bob and Carol and Ted and Alice?*" asked Rodney.

"Y-yes," said Elmer, "although our guru stresses empathy more than punching pillows."

This article is part of a chapter from Leo Rosten's new book *People I Have Loved, Known, or Admired*, to be published in September by McGraw-Hill.

"It was a marvelous film," grinned Rodney. "So perceptive. All those hung-up kooks, chasing adolescent phantoms—"

"Kooks? Phantoms?" echoed Elmer in dismay. "No, no, you got it all wrong, Rod. The movie gives an honest insight into four emotionally crippled people, typical of our alienated generation, brainwashed by the false values of our materialistic society. The film shows how such people, lonely and isolated, can break through their inhibitions to free their deepest emotions and widen their sensual potentialities beyond anything they'd ever dreamed possible—through honest, frank self-exposure in discussions, no matter how intimate, telling bedrock truths—"

"You think people should go around telling each other the *truth*?" asked Rodney in horror.

"Absolutely," said Elmer.

"You have bad breath," said Rodney. I dropped my fork.

"Oh," stammered Elmer, turning vermilion. "I didn't know. Thank you for telling me. I-I'll change to a stronger mouthwash!"

"Don't," said Rodney. "I was just testing your principles."

"That is a lousy trick!" cried Elmer. "Don't *you* believe in people telling each other the truth?"

"Good God, no," said Rodney. "It's too cruel, and it solves nothing. Why, if people went around telling each other the truth all the time, we'd have fisticuffs, bloodletting, homicides, divorces, ax murders—"

"I, for one, have decided to defy social hypocrisy by being truthful at all times!" declared Elmer.

"Okay," sighed Rodney. "What do you like best in bed?"

Elmer flushed. "This is not the right atmosphere for a question like that!" "Here's one that is: What do you really think of Leo?"

Elmer hesitated. "Pass the ketchup."

"Good lad," said Rodney. "Leo always passes people ketchup."

I passed the ketchup.

"You're confusing the issues, using debaters' tricks," complained Elmer. "The Nirvana Sensory-Expansion Sanctuary teaches us not to be ashamed of our natural emotions—"

"You think that's *good*?" asked Rodney, agape.

"Certainly!"

"But our natural emotions have to be shamed, chained, threatened, and restrained," said Rodney, "or this horrid enough world would become one big abattoir, rapery, and torture chamber."

"I meant man's good, noble feelings!" exclaimed Elmer. "You see how you twist my meaning? I meant feelings that hurt no one else! Touching, holding, embracing each other—those things are *beautiful*, not to feel guilty about."

"I don't feel guilty about embracing my wife, child, or secretary," said Rodney.

"Then why can't you show the same warmth to a stranger?"

"Male or female?" leered Rodney.

"Either!" said Elmer severely. "That's the point. A truly liberated person feels no guilt about showing physical affection to another human being, even one of the same sex. That other person is a human being, just like yourself."

"Like hell he is," said Rodney. "I am unique. So are you. So is the waiter. Besides, I don't feel lonely or alienated."

"Then why do you balk at publicly sharing love?" asked Elmer.

"Because I see no need to go around proving my virtue," said Rodney, "or getting kinky sex-kicks, or gratifying voyeurs, or letting any freak intrude on my privacy—or moon over my privateates."

"You have been crippled by this decadent society," mourned Elmer.

"Do you go to church?" asked Rodney.

"No," said Elmer stoutly. "I am a freethinker."

"Well, you're free to think about anything you want in church—"

"But it is an outmoded *institution*," blurted Elmer. "Man can worship God or Nature anywhere—in the hills, crossing a meadow, on a stretch of beach. We do not need the stultifying hokum of priests, ritual, prayers *en masse*—"

"Then why go in for mass snuggling, moaning, and weeping?" asked Rodney. "Pass the sugar."

"Again you distort my meaning," complained Elmer. "Real or synthetic?"

"Either. The reason I suggest you go to church," said Rodney, "is that you should address your complaints about this undeniably baffling and iniquitous world to the responsible cause thereof: the Lord. He, after all, made two sexes, potent gonads, and arranged for babies to be very small, utterly helpless, and totally dependent. This cozied mankind into the family, and a social system, in both of which our 'noble, natural' feelings—incest, patricide,

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SR/MAY 30, 1970

viable alternative, and both candidates in the 1968 Presidential election spoke as supporters of the Vietnam War, moods of despair swept across the campus, and the New Left could transform these moods into a disillusionment with liberal politics in particular and the idea of liberalism in general.

2) An internal connection between the thought of the early New Left and the thought of the later New Left. What both shared was an impatience, sometimes a distrust, and more recently a downright contempt for the methods and norms of democracy—the “cumbersomeness” or “sham” of representative elections, the “irrelevance” of undemonstrative majorities, the “magnipulation” of the masses by politicians and the media, the “dullness” of ordinary middle-class people, etc. Under the guidance of such authoritarian thinkers as Marcuse, the New Left in both its phases, although more so in the later one, revealed a profoundly elitist bias. It might speak about “the people,” and sometimes even “the workers,” but it found its base of support mainly among the alienated middle-class young.

When the phrase “participatory democracy” first began to be heard, it gained its impact as a response to a genuine problem that had been troubling both socialist and nonsocialist thinkers for some time: What could be done to stop the gradual erosion of democratic institutions, in which the formal appearance of participation by the people continued but the real substance declined?

At first, the New Left's emphasis on participatory democracy signified mainly a desire to reinvigorate democracy, to give it greater meaning and immediacy—although the New Left rarely had any concrete proposals for achieving this end. Too often participatory democracy meant in practice a blithe dismissal of parliamentary rules in the discussions of the New Left groups, a practice that may have encouraged collective expressiveness (and interminable meetings) but also proved to be peculiarly open to manipulation by tight little factions and charismatic figures emphasizing their own modesty. At best, such procedures helped enliven—were relevant to—the politics of small groups; but they could contribute almost nothing to solving the problem of democratic politics in large societies, where the sheer number of citizens and the complexity of competing interests require a system of representative institutions.

The stress on participatory democracy proved to be especially damaging in the curious way it prepared the ground for authoritarian politics. There was not too great a distance be-

tween the distrust shown for the limitations of representative institutions by the early New Left and the contempt shown for the very idea of representative institutions by the later New Left. To dismiss “formal democracy” in behalf of participatory democracy was in effect to jettison the values of both—as if, in reality, democratic rights didn’t always require a commitment to “forms,” that is, rules both fixed and open to change through agreed-upon procedures. By the late Sixties, one rarely heard much about participatory democracy from the New Left. Now the fashionable phrase was “revolution,” unspecified as to social character, political possibility, or ultimate goal, and too often reduced to a ritual of expressiveness that required neither thought nor moral justification.

Those of us who want to preserve and extend democracy, while simultaneously working toward fundamental social change, must acknowledge that the coming decade likely to be a time of trouble, even peril. There are linked dangers from the irrationalities and violence of both polar extremes, which together could destroy our hopes for an American movement at once democratic, militant, and radical. The New Left plays a double role here. It contributes valuable energy to the needed task of protest and insurgency, but it also contributes a political-moral confusion, sometimes verging on nihilism, which threatens liberal values and helps provoke a popular backlash.

Nor are our objections merely tactical. The kind of “revolution” envisaged by all the SDS factions has nothing to do with the large-scale social transformation this country needs. Who with a reasonable impulse to self-preservation and democratic survival would care to test out the dispensation of a Tom Hayden or a Mark Rudd? Worthy fellows, perhaps, but better powerless.

The perspective I would advance for the immediate future combines a broad coalition of popular forces to work for immediate social improvements along a liberal course, and a regathering of

those people, now a tiny minority in this country, who believe in the values of democratic socialism. This signifies:

* the premise that we are not and will not soon be in a “revolutionary situation”;

* the subpremise that, if “revolutionary activity” in the next few years comes to more than loud talk, it will have an elitist, desperado, and adv enturist character;

* the belief that it is in our interest to preserve and improve the present agencies of democratic politics, marred as they may be, requiring changes as they do, and even liable to sudden collapse as they are.

I think that the more sensitive and undogmatic elements in and near the New Left will soon have to face the futility of trying to “go it alone.” Their movement has grown and probably will continue to grow; yet, barring some major self-transformation, it will also continue to have the character of a sect isolated in fundamental outlook, language, and psychology from the American people. Nevertheless, it contains precious resources of energy and idealism, and this energy and idealism ought to be thrust into the mainstream of American politics.

One can only hope for a slow regathering of forces among the liberal-labor-Left in the United States. A movement that fails to understand the needs and aspirations of the American workers and their unions, or that dismisses them contemptuously in the name of some abstract revolutionary purity is doomed to failure. A movement that fails to understand the urgency of moral protest animating the young and that stays rigidly within the limits of traditional New Deal and post-New Deal liberalism is also doomed to failure.

Can we then bring together the strategy of coalition with the passions of insurgency? Can we recognize that in the American system wide and loose electoral blocs are essential, even if inherently unsatisfactory to ideological purists, while at the same time the idea of stirring the bottom layers of society to speak out for themselves is also urgent? Such a view is inherently complex, and this is a moment when many people are seized by a mania for simplicity; but I think it is a political perspective that, no matter how difficult to realize, is required by the present state of things. Oddly enough, if you were to go back to the founding document of SDS, the now-famous Port Huron statement, you would find a view of politics fairly close to what has been said here. One can only hope that many young people will yet return to it.

SR/MAY 30, 1970

11

matricide, the Cain-and-Abel bit—must be harnessed—”

Elmer was sputtering objections all over his meatballs. "That's the Freudian fallacy! And we can overcome it! The time has come to stop our self-deception, end all our lying—"

"Suppose you have cancer," said Rodney. "Terminal. Do you want your doctor to con you with cheer or tell you the truth?"

"The truth!" said Elmer.

"You are a brave, fearless, admirable man," said Rodney, but not in a brave, fearless, admiring tone. "Now, suppose your child has leukemia. Would you—"

"Of course not!" retorted Elmer. "She's too young to be asked to cope with such hopeless tragedy."

"Right. And so am I."

"That's an extreme example," sputtered Elmer.

"Then let's take an unextreme one. You're going out to dinner. Your wife comes in, all dolled up, wearing a new low-cut gown and a hairdo she spent four hours and twenty bucks on. 'How do I look, dear?' she asks. What do you answer?"

"It—depends on how she looks!" said Elmer.

"You cad," said Rodney. "You heartless fiend. Can you really say, 'Sweetie, you look like an aging Algerian houri who has seen better days, not to say nights. Your Pucci dress looks like a pooch walked across it with his paws dipped in bubble gum. Your hair reminds me of nine snakes wrestling in aspic. And as for your décolletage, Pussycat, let's face it: You're fifteen pounds overweight, in the bosom of the family, which is also where you're fifteen pounds overweight.'"

Elmer drew himself up into the huff that is known among the righteous as Elmer's Huff. "You mock my meaning! You caricature my ideas! You distort my reasoning—"

"Do I?" Rodney scratched his chin. "Didn't you tell your neighbors in Nutley, New Jersey, that Timothy Leary says LSD makes it possible to have a hundred orgasms a day?"

"Timothy was only giving that as a possibility—"

"Suppose you start having only ninety orgasms a day all over Nutley? Who will have enough strength left to bring in the milk, put on Junior's snowsuit, or turn on the six o'clock news?"

Elmer wiped his palms. "You are very hostile! You're just not on my wave length."

"Don't I turn you on?" asked Rodney.

"Certainly not!"

"I'm glad," said Rodney, "because 'wave length' and 'turning on' refer to

machines. It offends me when such barbarisms are used about people. After all, the basic difference between men and machines is that men have emotions. Machines don't. For dessert, will you have ice cream, cake, or tapioca?"

"Tapioca," said Elmer. "Or will you interpret that as a symbol of my soul?"

"Not your soul. Your ideas."

"Semantics! That's your undoing!" exclaimed Elmer. "Words! They distort ideas—"

Rodney said, "I always thought words are tools. Used with precision, they're irreplaceable. Used by the zonked, they're gibberish."

"No, no, no," protested Elmer. "Take the poets, the mystics, the new generation of singers. Listen to them! Just listen to their basic, preverbal truths. They teach us to express ourselves by smashing old forms—to forget and transcend words, to release our gut emotions—to grunt, growl, purr, snarl."

"Then why don't we get down on all fours?" asked Rodney, unkindly. "We could cancel out a hundred thousand years of civilization—imperfect though it be, violent and vicious and disgraceful though the human race often is. Will grunting, growling, purring, and snarling really redeem us? Cousin, honest to God, don't you think that instead of going to Swami Yonklowitz you might try an old-fashioned shrink?"

"You are a pawn of the Establishment!" cried Elmer. "You are a god-damn cynic! You throw cold water on every new, liberating idea!"

"First," sighed Rodney, "what you call new was old in Babylon—with unappetizing results. Second, what you call liberating, I think schizo-phrenic. Third, I prefer reason to day-dreams, and experience to pipe dreams, as tests of truth or validity."

The atmosphere was growing so charged I knew there would be no quick reaching for credit cards; so I hastily said, "Elmer, is it true that your swami says that, if everyone got a massage every day, there would be no war?"

"An interesting and original idea!" said Elmer.

"Oh, God!" groaned Rodney. "Nero and Caligula went right from their masseurs to butcher Christians. In fact, the massages so relaxed their senses they needed more Christians than if they hadn't—"

"You son of a bitch!" shouted Elmer.

"Elmer!" I protested. "Rod! You're both too intense—"

But I never finished my felicities. Elmer had popped two pills in his mouth. He was ashen, his lips parted, his forehead glistening. He was staring into space.

Rodney snapped his fingers. He did not seem at all worried, as I certainly was. "Elmer.... Stop that.... Elmer!"

Elmer made no answer. He was not dead, because he was sitting upright, not leaning right or left, and I could hear his breathing, which was exceptionally rhythmic. Elmer had gone into a trance.

I hear that Swami Yonklowitz is now teaching his acolytes how to spread the faith without swallowing any pills at all.

"All I did was throw open the window and say, 'Good morning, world.'"

SR/MAY 30, 1970

13

## Saturday Review

Editor - Norman Cousins

Publisher - William D. Patterson

Associate Editors

Irving Kolodin • Horace Sutton

Associate Publisher - Richard L. Tobin

### Managing Editor

Roland Gelatt

Science Editor

John Lear

Education Editor

James Cass

Book Review Editor

Rochelle Girson

Poetry Editor

John Ciardi

Travel Editor

David Butwin

Art Editor

Katharine Kuh

Copy Editor

Peter Nichols

General Editor

Hallowell Bowser

Layout & Production

Pearl S. Sullivan

Editors-at-Large

Cleveland Amory • Alfred Balk

Henry Brandon • Harrison Brown

Frank G. Jennings • Joseph Wood Krutch

Elmo Roper • Peter Schrag

Paul Woodring

Contributing Editors

Goodman Ace • Hollis Alpert • Jerome Beatty, Jr.

Henry Hewes • Arthur Knight

Martin Levin • Rollene W. Saal

Robert Lewis Shayon • Zena Sutherland

Walter Terry • Margaret R. Weiss

John T. Winterich

## The Manhood Game

“It is not our power but our will and character that are being tested,” President Nixon declared in explaining his decision to commit American fighting forces to Cambodia.

A White House aide, talking to a reporter, underlined this thesis when he said that the President had to show the world that “America hasn’t lost its manhood.”

What, then, is manhood?

Whatever manhood is, there are some things manhood certainly is not.

Manhood is not armed soldiers firing into a crowd of students, whatever the provocation.

Manhood is not a powerful nation raining bombs down on the villagers of a small nation, without any risk of counterattack or retaliation.

Manhood is not ordering soldiers to use flame-throwers in tunnels, often incinerating noncombatant civilians who are too terrified to heed the order to come out.

Manhood is not the manufacture and stockpiling of weapons beyond any reasonable definition of national defense—weapons that already far exceed any possible requirement for the use of destructive force.

Manhood is not dealing with error by concealing it or compounding it, or by making false pride more important than intelligence and compassion in America’s relationship with the rest of the world.

One curious feature of the manhood game as played by large nations is that it is filled with deadly contradictions.

The same nation that feels it can make an impression on others only by the show of force is curiously unimpressed by the same strategy when it is employed by others. This is true not just of U.S.-Soviet relations, but also of the increasingly ominous Israeli-Arab confrontation. Retaliation, not reconciliation, is the first impulse. A nation that believes others understand only the language of force has difficulty itself in speaking the language of peace.

The underlying theory of the manhood game is that a nation demonstrates its will and character in direct ratio to its readiness to use force in what it conceives to be its national interest. Thus, the Soviet Union finds it necessary at this time to carry out massive naval maneuvers in the Atlantic Ocean. Submarines, anti-submarine vessels, and auxiliary ships are involved in the exercises. They have been docking in Cuba to refuel and resupply. The obvious aim is to serve notice on Washington that Moscow does not lack the will and character to extend its overseas military commitments.

International observers, assessing the reasons for the Soviet military presence so close to U.S. shores, contend it is a reaction to President Nixon's decision to move into Cambodia. The Cambodian decision, however, has been described by some U.S. officials as a reaction to the increasing military commitment of the Soviet Union in the Middle East. It is obvious that each side is convinced its will and character are being tested by the other, and that the only way to pass the test is to dis-

play a readiness to use force in ever larger amounts and in increasingly risky situations.

The trouble with the manhood game is that it is played at the expense of man. The inevitable result of a competitive display of national manhood is to create the stage and the occasion for an ultimate assault on human life.

There is a wider, positive definition of manhood that takes in more than just raw force and the will to use it. Manhood has something to do with maturity, the comprehension born of experience, and the capacity for making moral judgments.

It may be said that this kind of national maturity is not possible in a world that lacks the specific institution and the machinery to render force unnecessary. The answer to this objection is that a nation such as the United States has the obligation to press forward with ideas for developing alternatives to force, brutality, and ill-temper. Nothing would be more dramatic and hopeful than for the United States to declare to the world that the central and overriding purpose of its foreign policy is to enable the United Nations to put the human interest above the national interest.
—N.C.

## Hippo

by Harold Witt

Wiggling small ears, with bubbling holes in what's too much to call a nose, here comes the hippopotamus submerged but looking out at us. He slips along upon his lip, and hoping peanuts, opens up a wrinkled cavern, pink, with teeth, hinting more and more beneath.

His humped eyes blink, his chins arise and as he climbs, surprised by size we watch a world of otherwise, a hipless blimp on stumps with toes—stepping out—the wonder is why nature made such tons of him; clumping off, eliminates—his mossy sideways tail shakes—

then glumly finished, goes back in, troubling the water once again, and since we've seen all sides of him the weighty question starts to thin—what came up is underneath widening ripples, and at least seems less monstrous, now we know how much hippo swims below.

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SR/MAY 30, 1970

The Washington Post

AN INDEPENDENT NEWSPAPER

MONDAY, JUNE 8, 1970

# The Problems Involved in Leaving Public Service

By Douglass Cater

CLARK Mollenhoff's boss on the Des Moines Register and Tribune voices gleeful expectations that Clark will bring along some juicy secrets now that he is leaving the White House and returning to journalism. Henry Kissinger's friends are publicly calling on him to quit and come home to

> The writer, a White House special assistant during the Johnson administration, is now working on a novel.

Harvard if he wishes to retain credibility in the academic community. Speaker McCormack is praised by Washington Post columnist David Broder for his "timely exit" from office—although 43 years in Congress may be stretching a bit the notion of timeliness.

All three situations illustrate a lesson of life which I have had occasion to ponder more than once: departing public service takes greater skill than entering it.

The lesson was borne in most clearly when I worked in the LBJ White House and watched a variety of colleagues make their exits. Few went through the experience unscathed. Most found themselves caught on one or the other horn of the dilemma—was he departing in love or anger? Of course, most men quit their jobs, just as they divorce their wives, for a mixture of reasons. But the press is seldom satisfied with lukewarm explanations. And few departees handle their leavetaking as artfully as one colleague of mine, a sub-Cabinet officer, whose resignation was hailed in the press as a major rupture within Johnson administration ranks. A columnist wrote that this man was the first to have the "guts" to quit over Vietnam. Wondering how this story had developed, I telephoned my colleague. Hadn't he got presidential approval for his resignation six months in advance so that he could tend to personal commitments? Yes, he replied, that was true. Then why had the press so badly misinterpreted his departure? "Oh," he replied blithely, "they asked if I agreed with Vietnam policy and I said that I didn't."

MR. Mollenhoff's leaving does present unique problems. He has been involved in a most sensitive area of governmental activity: searching out corruption and probing the intimacies of other people's income tax returns. So far as I know, he has been the first public inquisitor with White House rank. Obviously his mind will not become a blank if he returns to the practice of expose journalism for which he is noted. I have wondered his predicament and must regretfully confess that I have no concrete advice to offer him. I would hate to have to make his ethical judgments in the months ahead.

But for Henry Kissinger, whose departure problem is entirely different, I do have some advice: Be not hustled by friends outside government who are anxious to make one's moral decisions. A delicate scale weighs whether a man's worth is more by leaving than staying. The moral choice is rarely between being Martin Luther or Adolf Eichmann.

CERTAINLY, it is difficult to codify the laws of quitting. I was not particularly edified by David Broder's column interpreting Albert O. Hirschman's new book, "Exit, Voice of Loyalty." Commenting on unhappy Johnson appointees who stayed on, Broder remarks, "They know how long it takes to shed the cloak of cowardice that such inaction implies." Cowardice? As one who, to a degree, suffered and stayed, I can attest that the far easier course—the course offering rewards and praise and warm companionships—would have been to break with Johnson as noisily as possible.

To stay or not to stay. For one weighing his options, it is necessary to make a not so subtle distinction between bad policy and evil policymakers. If an appointee becomes convinced that the President is deranged or irrevocably committed to wrongdoing, then his only recourse is to resign, though there is not much historical evidence that this can have great curative effect. If, on the other hand, the appointee still believes that the

unending task of those in government is to struggle toward sound policy, then there is a strong case for staying and struggling. First of all, the nation's situation, both foreign and domestic, is too critical to encourage abdication as a way of life. Secondly, the blackmail powers of quitting are seldom very great. Perhaps for a few who have earned national prominence in their own right. But most appointees can hardly expect to accomplish much by what Hirschman-via-Broder calls the "unanswerable argument" of threatening to exit.

Obviously, an appointee must draw the line at some point if he finds himself serving as the agent for carrying out policy he believes to be profoundly wrong. So should one who finds himself a pariah in the policy-making councils. But the decision to leave should not be made without soul searching.

Broder concludes, "Hirschman suggests that men in power might take seriously the 'bumper-strip commandment' and decide that that which they no longer love, they should leave." I believe there could be no more certain and, if applied promiscuously cowardly commandment for handing over government to the reign of incompetents.

N.Y. TIMES Foreign Affairs: Suez and the Soviets

6-5-1970

By C. L. SULZBERGER

MOSCOW—Three years after the Six Day War began, Moscow's Middle East strategy is perhaps no longer based only on rearming the Arabs so they can overcome Israel while the Soviet Union and the United States warn each other to stay away. Indeed, Russia may be preparing deliberately to participate in a limited conflict, reckoning it can get away with this at little risk.

In 1967 the Kremlin avoided intervention to protect its massive Arab investment. The consequence was a swift Israeli victory. The Soviet leaders were then convinced Washington would not permit Israel's destruction and would forcibly prevent it. Now, however, there have been changes in the situation.

Russia considers it in its primordial interest to reopen the Suez Canal. This is no longer a major concern of other big powers because petroleum is more cheaply and efficiently carried in huge supertankers which could never squeeze through the canal.

Moreover, with the British and French empires gone and the U.S.A. in Asia essentially dependent on trans-Pacific maritime support, Suez has lost

strategic meaning for the West. But it shortens the route between European Russia's Baltic and Black Sea ports and the East—to India and North Vietnam. It also allows access by the U.S.S.R.'s growing Mediterranean fleet to the Indian Ocean and the Red Sea where Soviet penetration is significant.

So long as Israeli occupation of the canal's east bank continues, these major projects are frustrated. It is worth a considerable gamble to change this and the easiest way for Moscow—while insuring the consequent war doesn't get out of hand—is by supervising the operation under its own commanders in Egypt.

## What Russia Might Do

The Kremlin might conceivably use as an excuse almost any of the daily incidents occurring between Israel and Egypt. It could proclaim it was acting merely to enforce the U.N. Middle East resolution and that once Israel's 1967 Sinai borders were reached, fighting would halt. Moscow could insist this was a quick, one-shot operation designed to correct injustice and to open Suez for the good of world commerce.

This hypothesis was first conceived early in 1968 by Sir Harold Beeley, then British

Ambassador in Cairo. Even then it would have been difficult for the United States to intervene promptly on Israel's behalf and counter by superpower confrontation an operation proclaimed by Moscow as limited. Instant decisions on enormously vital matters would first have to be taken in Washington. And today the American people are far less in a mood to accept such decisions than they might previously have been.

Bitterly divided on Vietnam and Cambodia, confused by a sagging economy and torn by racial dissension, America may well be deemed by the Kremlin as today so weak that the gamble is acceptable for Russia. Every development of the past few months seems to fit into this analysis.

Moscow has been circum spect about Cambodia, where America is embroiled, but has been unyieldingly tough on the Middle East. It has sent SAM-2 and SAM-3 missiles to Egypt and protects them with a Soviet air division. The defense system was first established along the Nile Valley, preventing Israel from attacking Egypt's heart in the war of attrition.

Now a second stage has been

reached. The infrastructure for SAM-3 missile sites has been laid down along the west bank of the canal. If Egypt's own air force cannot defend these emplacements when the actual missiles are inserted, Russia may simply extend its protection to the front lines.

## Forcing the Issue

Then either the Israelis will have to withdraw from their existing positions as they become untenable or the Russians could decide to force the issue — perhaps when Israeli pilots have knocked down Soviet planes. Nowadays Russia not only has some armed cadres in Egypt but commando units and helicopter carriers in the Mediterranean.

Moscow's actions increasingly indicate the Kremlin might decide to force the reopening of Suez and strengthen its position in the Arab world, the Red Sea and Indian Ocean. The argument about whether Israel should be allowed to purchase more U.S. Phantoms is no longer even relevant to the possible new form of crisis.

Major U.S. Government contingency plans must be made now and perhaps aired in advance if deterrence is intended—before, not after the fact.

THE WHITE HOUSE
WASHINGTON

June 26, 1970

FOR JULIE PINEAU

Julie --

The attached draft is per our
telephone conversation. I am also
returning the incoming correspondence
which you sent over.

Pete Vaky

EMBAJADA DE CHILE

Washington, D.C.

June 5, 1970

Dr. Henry A. Kissinger
Assistant to the President
for National Security Affairs
The White House
Washington, D.C.

I have just come back from Mexico, where I
flew over the weekend to attend the opening
of the World Foot-ball Championship.

As I know that you are one of the few residents
of Washington who think - and with reason - that
also foot-ball is an important issue and that
watching a good foot-ball game is extremely
healthy, I am sending you some articles of the
Mexican press on the opening ceremony and the
first game played: Mexico and the Soviet Union.
Unfortunately, the score was nothing to nothing!

Will the Jules Rimet Cup remain in Latin America?
(In Brazil, for instance?). I hope you will help
us to win, from your location in the stadium,
when you attend the finals.

Domingo Santa Maria

KISSINGER, HENRY A.

JUL 10 1970

Dear Bill:

Many thanks for sending me Murray Kempton's
"Mr. Nixon Scares his own Side." He makes
some interesting points.

I do not think that I have forgotten your suggestion
about making combat duty voluntary. Changes
in this controversial subject are taking place,
but as one might expect, very slowly.

When will you be coming down? They have
finally moved me upstairs from my cold dark
place in the West Basement. I can't offer you
any better food, but at least nicer surroundings
to eat it in.

Mr. William F. Buckley, Jr.
Editor, National Review
150 East 35th Street
New York, N. Y. 10016

jlp:7/8/70

JULY 10 1970

CENTRAL OFFICE

NATIONAL REVIEW, 150 EAST 35th ST., NEW YORK, N. Y. 10016

Wm. F. Buckley Jr., Editor

Telephone: (617) 523-6974.

Telephone: (617) 662-7440

DR. GEZA J. JAKO
169 EAST EMERSON STREET
MELROSE, MASSACHUSETTS 02176

July 8, 1970

Dr. Henry A. Kissinger
White House
Washington, D. C.

Dear Dr. Kissinger:

Reading an article about you and your work in the July 7, 1970 issue of the Boston Evening Globe which I am enclosing here, I would like to sum up my feelings about you and this article.

Not having any insight in your work and your decisions, judging it only through the International affairs conducted by the White House, I would like to congratulate you for this excellent and broadminded International policy. I have been telling my friends around that the United States has never had a President before with so much International and political maturity and experience as President Nixon has. Naturally, part of these feelings would go for you too. It is unfortunate that many members of the Harvard academic staff, who are sharply criticising your work, have never had the experience that you have had. Most of them are interested in their own small world and cannot see the International interest of this nation. I am hoping that your work will not only change this country's International policy for the better, but some day, when you feel that you have accomplished what you wanted in the government, that you will come back and change the thinking at Harvard too. I definitely feel that you should stay with our President until most of your goals are accomplished, and you can work for the International interest of our country.

I just wanted to give you some encouragement to stay on because there are many of us in the academic life, who are maybe not so noisey as others, but are supporting the President and your policy.

Associate Professor - Boston University

Executive Chairman - Hungarian-American
Republican National Federation

GJJ:mc

Enc.

ners

e
k office at

er is

of at least slow revival was
the acceptance by the Gov-
ernment National Mortgage
Association of $331.5 million
of mortgages from the sav-
ings and loan associations in
the first phase of a program
to help low and moderate in-
come housing. The bonds
will be sold when market
conditions are believed fav-
orable, and this type of buy-
ing will be continued as the
Federal National Mortgage
Association (Fannie Mae)
has a forward-commitment
market in which it periodi-
cally "auctions" commit-
ments to buy mortgages in
the future.

As expected by a few
economists outside Washing-
ton, the Federal Reserve
Board Industrial Production
Index for June fell to 168.6%
of the 1957-1959 base, down
0.3% from the 169.1% of May.
Although the third monthly
decline, it was much smaller
than the sharp 0.8% drop in
May. Without the 4.5% in-
crease in June auto produc-
tion, the index would have
fallen 0.5%. Demand for fi-
nal products was off only

demands. Just w-
procedure he will unde-
is idle to guess, alth-
rumor has spread
that a cut in mem-
reserve requiremen-
be the first step. I
as there is not m
yet of a seasonal u
the economy, and
no assurance of c
danger of an au
strike is past and
models can be suc
marketed, there is n
what might be pr
credit easing.

As it is, the Fed
prompt to relieve t
depicted by the $-
drop in commercia
outstanding in th
three weeks of Ju-
decline in 19 months
ing the Penn Centr
ruptcy, and the Chr
nancial predicame
Fed not only opened
count window wide
stepped up its open
operations. Through
chase of $1.168 bill
ernment securiti
brought system to
ings to a record $5

# Aggressive Mr. Bauer

## He Has Left His Mark on Security and Commodity Trading

BY RICHARD A. DONNELLY

NOTHING too exciting ever happens in Conshohocken, Pa., one of those numerous not-very-big, not-very-small industrial towns that fan out from Philadelphia. By and large, its 10,259 citizens are law-abiding folk, who go quietly about their business, cast an occasional line into the sleepy Schuylkill River, take an infrequent night out in Philadelphia and have a special feeling for Alan Wood Steel Co., the town's largest industry and leading employer. One day in late April of 1969, however, Conshohocken came to life when The Wall Street Journal disclosed that an unidentified "West German group was seeking to buy stock" in Alan Wood Steel. The news caught most of Conshohocken by surprise. More puzzled than surprised, though, was Charleston R. Wood, chairman and president of the steel company, who, with his family, is in firm possession of over 40% of Alan Wood's stock. Noting that he had received several cables from what purported to represent a "powerful and select German industrial group," Mr. Wood conjec-tured that "somebody in Munich may be planting this whole thing."

### More the Merrier

The offer, as it happened, was no plant. Whether the men making it really were "powerful and select" is a matter of judgment; however, their spokesman was none other than Ludwig Erhard, former chancellor of West Germany. Lending an intriguing flavor to the affair was that Alan Wood was the object of *another* acquisitive probe by German-born John P. Bauer, head of his family's food company and a business associate of Dr. Erhard. Bauer, who denied any connection with the Munich group, first evidenced his interest in Alan Wood in January of 1969, purported to

In a way, John P. Bauer has come full circle. In 1933, at the age of eight, his family had to abandon its substantial food processing activities in Fuerth, Bavaria, when Hitler came to power, and flee to Paris, where his father set up operations again. When Nazi troops overwhelmed France in 1940, the family moved to the States and once more went into the food business. In 1967, John Bauer, by then head of Bauer International, returned to Germany and established Bauer International (Europa) gmbH, in Frankfurt.

After he arrived in the States, Bauer attended school in New York City, then went into Army military intelligence, where he was assigned to a team connected with interrogating German prisoners of war at a secret installation outside of Washington, D.C. These were top-ranking prisoners such as scientists and generals, Bauer says, "and we really took them apart."

Bauer is a friend or at least an acquaintance of influential people (he's been seen with Senator Jacob Javits, Golda Meir, prime minister of Israel, and Ludwig Erhard, former chancellor of Germany). And he will mention that he went to grade school in Fuerth with Henry Kissinger, special assistant to President Nixon.

look. Fortyish, dark, gravel-voiced, he first captured the attention of Wall Street in June of 1968 when, with some associates, he purchased a block of 200,000 shares of Swift & Co. To this day, what he had in mind isn't entirely clear.

### Modus Operandi

Although he announced that he was seeking to buy up more Swift shares, within a month he unloaded his original block, claiming he had been rebuffed by Swift management

family, and another 10% is owned by employes, a serious acquirer obviously would need the cooperation of the voting trust. But while he was accommodated to the extent of being taken on a tour (accompanied by his mother) of the Alan Wood plant, Bauer met not cooperation, but instead firm resistance.

Bauer, though, is a man not easily discouraged, as the people at Alan Wood learned on December 17, 1969, when the American Stock Exchange suspended trading in

that between December 2 and December 9, Bauer and Bauer International purchased, for their own accounts and for accounts Bauer controlled, 50,000 shares of Alan Wood common through two brokerage houses in 10 separate transactions and in the same span, sold, through two other houses, 53,900 shares of Alan Wood in 16 separate deals.

Because trading in Alan Wood stock is normally light, the SEC charges that Bauer and his companies "so dominated the market ... that on days when they were active, their trades constituted between 36% and 90% of the total activity in the stock for the day.... The appearance was given that volume and, thus, market interest in the stock was far greater than it really was."

Specifically, according to the SEC, "on December 3, 1969, at 2:31 p.m., defendant Bauer entered an order to sell 10,000 shares of Alan Wood common stock from an account he had opened in the name of International Genossenschaftsbank (a Swiss bank) at Filor, Bullard at a limit of $40 per share. Nine minutes earlier, defendant Bauer had entered a matching purchase order for the same number of shares at the same price limit for the account of defendant Bauer International at Lehman Brothers, and all 10,000 shares were purchased by him at the limit price of $40 per share. Later in the day, at 3:01 p.m., defendant Bauer succeeded in selling on the open market 700 shares of Alan Wood stock for the account of defendant Bauer International at a price of $41 per share, the high price for Alan Wood stock that day.

### Misleading Impression

"Thus, by matching the 10,000-share sell order which defendant

AGGRESSIVE MR. BAUER

*Continued from Page 5*

Bauer's announcement touched off a drop in futures prices.

On December 17, another Bauer press release, circulated by P. R. Wire Service, announced that the first shipment of Spanish shell eggs "ever to be shipped to the U.S. from Spain is scheduled to arrive on the steamer Sea Witch of the Sealand Container lines on December 19, 1969. . . . The shipments to the USA will proceed rapidly from now on on regular scheduled steamers operating from Spain to New York."

On January 7, another press release was sent to P. R. Wire Service with instructions that it be disseminated to all editors of economic and commodity news throughout the nation, including wire services. The release stated that the first shipment from a total purchase of 425,000 cases of Spanish eggs had arrived on board the Sea Witch and that shipments would continue at a rapid pace. The

whole quantity, it was stated, would be shipped before January 25.

These three publicity releases and their subsequent publication in several financial journals attracted the unfriendly eye of the United Egg Producers Association. On January 16, the Association filed notice of a preliminary injunction asking the court to enjoin "the defendants from delivering or causing to be delivered false or misleading or knowingly inaccurate reports that affect the price of eggs in interstate commerce."

## Egging Them On

The egg group also asked $15 million in damages on behalf of the producers and futures traders. There's no argument that the domestic price of fresh eggs was high (the Commodity Exchange Authority in late December had launched an investigation into the sharp rise in egg contract prices). Too, there was a surplus of Spanish eggs. Beyond these bare

facts, things are considerably less clear.

Bauer points out that egg prices continued to rise despite his announced intentions of bringing in Spanish eggs. They might have dropped back on a given day ("people take profits"), but overall, the trend was up. Moreover, he insists, the United Egg Producers, in reality, controls the market.

Be that as it may, Bauer never quite fulfilled the promise of his press releases. He did bring in a shipment of 2,400 cases of fresh eggs in December, but these bore no relation to his promised 425,000 cases of storage eggs. He did send over representatives to inspect the Spanish supply and he opened up a letter of credit with the Banco de Santander, Madrid, first for $800,000 covering 200,000 cases of Spanish shell eggs and, ultimately, for $1.8 million, covering 425,000 cases. Everything depended on how well the eggs passed inspection.

Curiously, however, Bau-

er had no written contracts for the shipment of the eggs here. This was to count against him in court, as was his admission that he had sold short on eggs on the Chicago Mercantile Exchange. However, Bauer protests, it wasn't the shorts who should have been investigated. Rather, "they should have investigated those who were long. Because the longs made the money."

## Strikes Back

On this score, in mid-February he struck back with a $60 million counterclaim against United Egg and others charging that they "combined and conspired together to fix the price of eggs sold for consumption in the U.S. at high levels by manipulating the supply of eggs available for sale and creating artificial demands for eggs."

This countersuit was thrown out in the U.S. District Court on April 27 on the grounds that the association was an agricultural cooperative and therefore immune from such charges. Earlier, on March 17, Judge Dudley Bonsal had issued a preliminary injunction "enjoining defendants from delivering or causing to be delivered

for transmission through the mails or in interstate commerce by telegraph, telephone, wireless, or other means of communications false or misleading or knowingly inaccurate reports that affect or tend to affect the price of eggs in interstate commerce. . . ."

Amid these legal storms, Bauer remains outward calm. Although he consented to entry of a temporary restraining order in the Alan Wood case, he shrugs it off: "There's nothing wrong when the market in a stock goes down to 22, but the moment it goes up to 42, even though its book value, its multiple, would be justified, then, of course, you get into a problem." And although he's not eager for more legal combat in eggs, he claims his actions were morally and legally justified.

He currently controls about 10% of the outstanding stock of Alan Wood and now says he never had any intention of taking over the company, although he did hope to place a representative on the board. Why invest in a steel company, he was asked, when it was his stated purpose to buy into related food companies to

*Continued on Page 14*

dustrial group," Mr. Wood conjec-
tured that "somebody in Munich
may be planting this whole thing."

More the Merrier

The offer, as it happened, was no
plant. Whether the men making it
really were "powerful and select"
is a matter of judgment; how-
ever, their spokesman was none oth-
er than Ludwig Erhard, former
chancellor of West Germany. Lend-
ing an intriguing flavor to the
affair was that Alan Wood was the
object of another acquisitive probe
by German-born John P. Bauer,
head of his family's food company
and a business associate of Dr. Er-
hard. Bauer, who denied any con-
nection with the Munich group, first
evidenced his interest in Alan Wood
in January of '69, persisted despite
rebuffs from management and fi-
nally made a bid for 150,000 shares
late in December when the stock
was at its all-time high (a perch not
shared by too many other issues at
the time). Bauer's bid touched off
concern in Conshohocken and cul-
minated a series of events which
caused suspension of trading in the
steel company's stock and brought
the 42-year-old entrepreneur into
confrontation with the SEC.

Not a man content with one foray
or one battle at a time, Bauer, while
tangling with the agency, also found
himself in hot water with a trade as-
sociation for his dealings in egg fu-
tures. For a fellow who was un-
known on Wall Street a scant two
years ago, Bauer already has made
something of a splash (although in
many ways a "mysterious" if not
shadowy figure, Bauer doesn't ex-
actly flee from publicity). Moreover,
undaunted by his brief but lively his-
tory of abortive takeover attempts,
Bauer says he is gearing up for an-
other "major" acquisition try.

Because his operations are global
in scope and span both the securities
and commodities realm — and be-
cause most of his more prominent
counterparts are so quiescent these
days—John P. Bauer merits a closer

pro (he's been seen with Senator Jacob Javits, Golda Meir, prime min-
ister of Israel, and Ludwig Erhard, former chancellor of Germany).
And he will mention that he went to grade school in Fuerth with
Henry Kissinger, special assistant to President Nixon.

Modus Operandi

Although he announced that he
was seeking to buy up more Swift
shares, within a month he unloaded
his original block, claiming he had
been rebuffed by Swift management
in an attempt to negotiate an agree-
ment. However, spokesmen for the
meat packer said they doubted that
Bauer was serious about taking over
the company. What is perhaps most
notable about the Swift episode is
that it set a pattern for Bauer's mar-
ket operations—disclosure of a posi-
tion with as much fanfare as possi-
ble and the implication of more to
come—only to be followed, usually
within weeks, by a quiet withdrawal.

Bauer's base for his acquisitive
activities is the presidency of Bauer
International and a clutch of affili-
ated companies engaged primarily
in the meat, dairy and poultry fields.
The complex includes a West Ger-
man subsidiary Bauer International
(Europa) gmbh, Frankfurt. This
business does an annual volume of
$85 million. If nothing else, it lent
credence to Bauer's interest in Swift.

However, as noted, when the in-
vestment community again heard
from John P. Bauer, it was in con-
nection with a company far removed
from food: Alan Wood Steel Co. By
June, Bauer had accumulated ap-
proximately 59,000 shares of Alan
Wood. From the start, Charleston
Wood insisted that the concern was
not for sale. Since better than 43%
of the outstanding shares are held
by a voting trust set up by the Wood

family, and another 10% is owned by
employes, a serious acquisitor obvi-
ously would need the cooperation of
the voting trust. But while he was
accommodated to the extent of being
taken on a tour (accompanied by his
mother) of the Alan Wood plant,
Bauer met not cooperation, but in-
stead firm resistance.

Bauer, though, is a man not eas-
ily discouraged, as the people at
Alan Wood learned on December 17,
1969, when the American Stock Ex-
change suspended trading in their
stock and asked the SEC to investi-
gate activity in the issue. Two days
later, in a Wall Street Journal inter-
view, Bauer announced that Bauer
International intended to purchase
150,000 shares of Alan Wood com-
mon stock. The day before, he had
filed a tender offer with the SEC.
However, the offer was withdrawn
abruptly on December 23 and tradi-
ing in the shares resumed. Slightly
over $40 when the bid was disclosed,
the stock sold off to $36.25 per share
in the session following resumption
of trading.

The SEC's Charges

In February, the SEC asked the
U.S. District Court to issue a prelina-
inary injunction stopping Bauer
from manipulating Alan Wood or
any other stock. In particular, the
Commission charged that in early
December Bauer had engaged in
two illegal procedures — "matched
orders" and "wash sales"—in order
to create an appearance of activity
in Alan Wood stock. (A matched
order is one placed with the know-
edge that an opposite order has been
placed of substantially the same
size and at substantially the same
price. A "wash sale" occurs when
one source is both buyer and seller.)

Specifically, the SEC charged

Genossenschaftsbank (a Swiss bank)
at Filor, Bullard at a limit of $40
per share. Nine minutes earlier, de-
fendant Bauer had entered a match-
ing purchase order for the same
number of shares at the same price
limit for the account of defendant
Bauer International at Lehman
Brothers, and all 10,000 shares were
purchased by him at the limit price
of $40 per share. Later in the day,
at 3:01 p.m., defendant Bauer suc-
ceeded in selling on the open market
700 shares of Alan Wood stock for
the account of defendant Bauer In-
ternational at a price of $41 per
share, the high price for Alan Wood
stock that day.

Misleading Impression

"Thus, by matching the 10,000-share sell order which defendant Bauer had entered for International Genossenschaftsbank, defendants were able to keep the price of Alan Wood stock above the $40 level and profit thereby later in the day. Furthermore, the matched order allowed the completion of a limit order whose execution might not have been possible otherwise and resulted in reported daily volume of 12,700 shares traded on an advance of $0.50 per share. Such information could only convey a misleading impression to an interested public investor."

On February 19, Bauer consented
to entry of a temporary restraining
order, obtained by the SEC, pro-
hibiting him from manipulating the
stock of Alan Wood Steel Co. or any
other security. The SEC now is
seeking a permanent injunction.

During the period Bauer is al-
leged to have placed matched or-
ders in Alan Wood, he was also busy
on the commodity front. On Decem-
ber 3, 1969, he issued a press release
stating he had purchased 425,000
cases of Spanish eggs (or 153 million
eggs) and that the first shipment
would be leaving Spain for the U.S.
on December 8. At the time, eggs
were in short supply domestically
and prices were high. Accordingly,

*Continued on Page 12*

Mr. Bauer

*Continued from Page 12*

which he could bring "knowledge and vision"? Bauer says it was agriculture that brought him to steel, that he felt import restrictions would be placed on steel in the U.S., as there are import restrictions on agricultural products in the Common Market. He claims he was always essentially interested in buying undervalued equity, and he saw that Alan Wood was a well-run operation, and with book value of $52 and earnings last year of $6 per share, "it was a good buy."

His only complaint today is that Alan Wood management "doesn't look out too much as far as the investor is concerned. Even though it's an excellent company, with excellent performance, the stock isn't showing that kind of value, reflecting the kind of value it should."

In any case, he's now ready for more action. He says he's eyeing several

possibilities in the food field, where he's convinced his experience in the international arena can open fresh markets for a domestic operation or strengthen one with weak ties abroad. He makes no bones that he wants a part of the management of such a company.

If the past is any guide, Bauer's next move will be neither quiet nor uneventful.

asking us to wait until they could get HIP (the Health Insurance Plan, to which the TBTA subscribes) involved. They felt they had a contract with HIP and it should be doing most of the work, not Ayres. They still haven't put in effect a health surveillance plan."

At a meeting last Friday, Mauro said, union officials "in order to get things going" agreed to a "combo plan of HIP and Dr. Ayres."

"When the guys heard there was no agreement that all the tests would be taken by Ayres, they began to grumble. Then I guess they just got disgusted at waiting since last Thanksgiving and walked out."

Compounding the health

## Newark-Cuba

A Trans Caribbean airliner with 154 d was hijacked from Newark Airport y.

from Newark at 1 a. m. and landed

101 bound for Puerto Rico, radioed at 3:22 saying it had been hijacked

us received from the aircraft until

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