The Daily Collegian Friday, July 31, 1981
Fire, smoke cause
extensive damage
Pugh Street house
Fire caused extensive damage yesterday afternoon to a
South Pugh Street house and sent a State College man to
the Centre Community Hospital.
Dale Herman, 525 S. Pugh St., was treated and released
for smoke inhalation, a hospital spokeswoman said.
Robert Fanning (13th-public service) said he was walk
ing home from work and noticed smoke coming from the
chimney of Herman's house. He said he bad just passed a
policeman and ran back to report the fire.
State College police officer Frank Cingle said he called
in the fire at about 2:15 p.m. He and Fanning then banged
on the windows to see if anyone was in the house.
"We were pounding on the back door and he (Herman)
came out," Cingle said. "He was staggering."
Herman told Cingle and Fanning he was sleeping when
the fire broke out.
"He was lucky," Cingle said.
Fanning said he did not see any flames but there was
smoke everywhere.
"It was very, very thick black smoke," Fanning said. "I
expected it to go any minute flames and everything."
Cingle said the fire was under control in about 10
minutes.
Alpha Fire Chief Marvin Robinson said the one-alarm
fire started on the first floor of the two-story structure. He
said there would be an investigation into the cause of the
fire.
State College police corporal Robert Abernathy said the
fire was contained to the first floor. He said they would not
know the cause until after they interviewed Herman.
—by Margaret Ann Walsh
Economy
By VICKI FONG
Daily Collegian Staff Writer
The U.S. economy is moving toward a devastat
ing depression if the federal government contin
ues on its policy of deficit spending and does not
return to a gold monetary standard, a University
instructor of international business said.
"We are already in an invisible crash," said
William Fenton, a State College tax attorney and
instructor for International Business 297 Gold
and Silver. Fenton spoke in the "Government,
Inflation and Gold" program sponsored Wednes
day night by the Undergraduate Student Govern
ment.
Real estate prices are an example of the infla
tionary cycle, Fenton said.
"If you buy a $lOO,OOO home today, it's worth no
more than the $30,000 home your parents paid for
20 years ago," .he said. One home can be worth
$30,000 in gold but $lOO,OOO in dollars, he said.
Holding up an $1 bill, Fenton said, "This paper
is depreciating to the true value of the piece of
paper and the ink it's printed on." As the govern
ment prints more paper money and reduces the
gold backing, the value of the dollar will continue
to fall, he said.
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In 1934, President Franklin D. Roosevelt re- percent backing, the money supply will increase
duced the amount of gold backing for the dollar but only in relation to the amount of gold discov
and eliminated domestic convertibility, stopping ered," he said. "Under the gold standard, which
private citizens from exchanging their dollars for has existed and will again in tIO decade, you will
gold, Fenton said. In 1971 President Richard M. eliminate inflation."
Nixon "shut the gold window" and eliminated The gold standard will stop inflation because as
foreign convertibility of U.S. dollars to gold, he domestic prices rise, people will buy cheaper
said. ' imported goods, shifting the balance of trade,
"It's no different than taking Kool-Aid and Fenton said. Gold will be paid to foreign countries
'lf you buy a $lOO,OOO home today, it's worth no more
than the $30,000 home your parents paid for 20 years
ago.'
adding more and more water to it," Fenton said.
"France, Italy, Germany and the Roman Empire
they all collapsed because of the funny money
game with a major depression.
"If you print these pieces of paper with 100
■
116 A
Fire and smoke caused extensive damage to this, house at 525 S. Pugh St. yesterday. Police have not determined the cause of the
•
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—William Fenton
but then credit based on gold will be restricted, he
said.
_ .
Gold's base of stability worldwide is because of
its endurance and rarity, he said.
"(Gold) cannot be manufactured by mankind.
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Acceptance of this metal has lasted for 6,000
years," Fenton said. "Government can't outlast
tradition."
Another problem adding to economic instability
is government deficit spending, Fenton said.
The theory behind deficit spending Keyne
sian economics was developed in the '3os after
the Depression and was intended to lend money to
needy businesses and areas that would be paid
back, he said.
But politicians never forced reimbursement,
fearing unpopularity, Fenton said, so the national
debt increased continually
Using a chart, Fenton showed the amounts of
U.S. domestic and foreign debts. The total adds up
to about $1.5 trillion, he said. The government just
prints more money to pay off its debts, he said.
"The last 21 years have been deficit years
through fractional reserve banking and .printing
more money," he said. ,
Top stop inflation, Fenton suggested three steps:
O Balance the budget. "You can't spend more
money than you're taking in," Fenton said.
e Return to the gold standard.
® Stop increasing the money supply. "We have
to stop increasing the supply of money. We must
freeze the dollar at a constant," he said.
"Only if all three are accomplished, will we
have a long-term stability and avoid collapse,"
Fenton said
About 60 to 65 people attended Fenton's speech
and the film, "Gold," produced by the National
Geographic Society, said Bill Cluck, USG presi
dent.
"I was pleased. It's worth continuing these
types of programs," Chick said. "There are a lot
of subject areas students and townspeople can't
take classes on but can debate.
"(The program) supplements what Colloquy is
trying to do. There's enough talent in this Univer
sity; there's a whole broad area that haven't been
touched on," Cluck said. "Anything that will
stimulate intellectual debate should be welcomed
by all."
He would like to sponsor intellectul programs
twice term, and the cost of such programs would
probably be minimal, Cluck said. But, the pro
grams do not come under the responsibility of a
specific USG department, Cluck said.
"It'll probably stay within the executive staff
for now," he said. The executive department can
organize the projects until USG decides if a new
department is necessary, Cluck said.
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