Banner Graphic, Volume 22, Number 114, Greencastle, Putnam County, 16 January 1992 — Page 2

THE BANNERGRAPHIC January 16,1992

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German juggernaut put in check Slowing economy bodes ill for the rest of the world

BERLIN (AP) The slowing of the German economic locomotive is an ill omen for a world that seems to be begging for a big economy any big economy to help turn around the global slump. Economists now debate whether the western German economy is in recession like those of the United States and Britain. STATISTICS are confused by the gyrations that followed German unification, but there’s little doubt that the bloom is off. Economics Minister Juergen Moellemann says the economy is on a “knife’s edge.” He’s ready to battle what he calls “absurd” union

Banner Graphic (USPS 142-020) Consolidation ol Tha Daily Banner Established 1850 Tha Herald The Daily Graphic Established 1883 Telephone 653-5151 Published daily except Sunday and Holidays by Banner Graphic, Inc. at 100 North Jackson St., Greencaatle, 1N.46135. Second-class postage paid at Greencaatle, IN. POSTMASTER: Send addreea changes to the Banner Graphic, P. O. Box 508, Greencaatle IN 46135. Subscription Rates Per Week, by carrier 81.40 Per Week, by motor r0ute................—. $1.45 Mail Subscription Rates R.R. IN Reel of Rest of Putnam Co. Indiana U.S.A. 3 Months $21.00 623.00 $25.00 6 Months $40.00 $45.00 $50.00 1 Year $78.00 $86.00 $85.00 Mail subscriptions payable in advance ... not accepted in town and where motor route service ia available. Member ol the Associated Prose The Associated Press is entitled exclusively to the use lor republication of all the local news printed in this newspaper. Steve Hendershot General Manager/ Marketing Director Eric Bernsee Editor Wilbur C. Kendall Production Manager Gib Farmer Business Manager June Leer Circulation Manager

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pay demands while the 3.6-million-member IG-Metall metalworkers union has set a Jan. 26 date for a strike vote in a northern steelproducing region. Germany’s central bank, the Bundesbank, is fighting inflation by raising interest rates to record postwar levels, dismaying U.S. and European governments that watt lower interest rates to encourage growth. ECONOMIST Axel Siedenberg of Deutsche Bank, Germany’s largest commercial bank, notes that gross national product shrunk in the second and third quarters of 1991 and “with no prospect of a recovery soon, western Germany is finally following the Anglo-Saxon

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countries into recession.” “The stagflation in western Germany is casting its shadow over the whole of Europe: it is hampering monetary policy scope and leaves no room for an upswing in Europe,” Siedenberg wrote in a blunt assessment last month. But is western Germany in a recession? The government and the central bank won’t use the “R----word.” They say the economy is returning to normal after the burst that accompanied unification. THE FEDERAL Statistics Office release preliminary figures Wednesday showing Germany’s GNP grew 3.2 percent in 1991 to $1.6 trillion, giving western Germany the third largest economy after the United States and Japan. It was the ninth straight year of GNP growth, but the overall figure for the year masked the downturn after the early part of 1991. GNP contracted 0.5 percent in each of the second and third quarters, meeting the classic definition of a recession two quarters of non-growth. FOURTH-QUARTER figures weren’t available, but were predicted to be roughly flat Siedenberg and others say Germany’s economic slowdown is ominous for a global situation in which the United States is failing to rebound, Japan is slumping, most western European economies are fiat and former Communist countries are seeking capitalist help. But Peter Pietsch, spokesman for Commerzbank, another of Germany’s biggest commercial banks,

Bayh has $l.B million in bank for re-election bid

INDIANAPOLIS (AP) Democratic Gov. Evan Bayh’s reelection campaign began the year with six times more money than the total accumulated by his three potential Republican challengers. Reports filed with the State Election Board Wednesday showed Bayh’s political committee raised more than $1.27 million in 1991 and ended the year with $1.84 million in cash on hand. THAT PUT THE first-term governor, who plans to announce his re-election campaign soon, far ahead of all of his potential rivals in the Republican Party. Attorney General Linley E. Pearson ended the year with $300,438 on hand, Superintendent of Public Instruction H. Dean Evans had $2,875 and Valparaiso businessman John A. Johnson had $2,018. Johnson, a wealthy industrialist, was largely financing his campaign out of his own pockeL He made 10 loans worth $113,000 to his campaign between Oct. 3 and Dec. 26,

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says Germany is not in recession. “THE STIMULUS in 1990-91 was so strong that it is normal to decline. That has nothing to do with recession,” Pietsch said in a telephone interview. Pietsch noted that western German industrial production rose 1.2 percent from October to November. He predicted that the economy would look weak in statistics until mid-1992, then pick up strongly. The Die Zeit weekly newspaper’s survey of nine economic think tanks showed predictions of economic growth in 1992 between 1.5 percent and 2 percent for western Germany, and whopping growth of 9.5 percent to 14 percent in the formerly Communist east. UNIFICATION WAS a heady tonic to the western economy. Factories and importers worked flat-out to meet pent-up demand and Germany became a locomotive for its trading partners. Unemployment dropped and the western economy added 800,000 jobs. The eastern economy went in reverse: 1.9 million jobs were lost as obsolete factories closed and many customers in the Soviet Union and eastern Europe went dry. Now industrial production is starting to turn up, but unemployment is expected to rise for several months. Such gyrations make the two German economies hard to read and economists are wary about the quality of eastern statistics. REBUILDING THE east is a costly drag on the western German economy and, by extension, on the world economy.

according to the finance report In 1990, Johnson spent more than $660,000 of his own money in an unsuccessful race against sth District U.S. Rep. Jim Jontz. SUPPORTERS OF Bayh said his success in fund-raising is a reflection of his popularity. “We’re doing OK,” said Ann M. DeLaney, executive director of the Indiana Democratic Party. “I think it says the governor's got broadbased support and people are eager to contribute. It bodes pretty well for November.” State Republican Chairman Rexford C. Early said he wasn’t surprised by the numbers. Incumbents always have better luck raising money than challengers, he noted. “OBVIOUSLY, he’s got a head start, but that’s not a major concern,” said Early. “We knew he was going to outspend us. He’s probably going to spend six to eight million dollars.” Early said he’s confident Republicans will be able to raise

Gamsakhurdia, back in Georgia, declares start of a civil war

MOSCOW (AP) Ousted Georgian President Zviad Gamsakhurdia secretly returned to his native western Georgia today and declared war on the forces that overthrew him, according to witnesses and the republic’s new leaders. Gamsakhurdia flew to Sukhumi, Georgia, then drove to Zugdidi, where he spoke with supporters at a pre-dawn rally, Tengiz Kitovani, a member of Georgia’s ruling military council told journalists in the capital, Tbilisi. Zugdidi is about 150 miles from Tbilisi. THE MILITARY council ousted Gamsakhurdia on Jan. 6 from the parliament building in the capital after a bloody, 16-day battle and he took temporary refuge in neighboring Armenia, which he was reported to have left on Wednesday. At least 113 people were killed in the battle for Tbilisi, which laid waste to much of the capital center and left the nation bitterly divided. The military council, a loose coalition of dissidents, intellectuals and military leaders, controls Tbilisi. But Gamsakhurdia has considerable support in western Georgia and much of the countryside of the fertile, former Soviet republic of 5.5 million people. TODAY, HE urged his supporters to start “a crusade on Tbilisi,” according to a witness,

plenty of money once it’s clear who their nominee will be. To this point, many donors still haven’t made up their mind and thus haven’t made contributions, he said. “WE WILL HAVE what it takes to run a good campaign that we need to win,” said Early. At a minimum, that will be $2.5 million, he said. If the nominee is a good fund-raiser, the figure could go substantially higher, he said. DeLaney said she expected Pearson to hold a substantial advantage over his two rivals, who have been in the race only a brief time. Evans announced his candidacy last week, and Johnson began to campaign last fall. Pearson, who will formally announce his candidacy soon, had raised $88,209 entering last year. AMONG THE highlights of the finance reports: • Bayh: His committee began 1991 with $751,994 on hand and raised almost $1.26 million during the year. It spent $185,316. Carpenter’s unions are the leading labor contributors to Bayh’s campaign. At least 12 carpenter’s locals reported giving $5,000 each. Indianapolis liquor wholesaler T.P. Donovan gave Bayh $25,000 and also gave Pearson $13,000. Robert Gore, a media consultant to

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and announced the start of a civil war. The witness, reached by telephone, spoke on condition of anonymity. Georgi Zumbadze, a representative of the National Democratic Party of Georgia a party that had opposed Gamsakhurdia said in Moscow that “in the final turn, Gamsakhurdia’s attempts are doomed to failure.” But there have been increasing signs of tension in western Georgia, where rail links have been severed to the capital for several days as Gamsakhurdia supporters organized. VOLUNTEERS were being signed up in the rural areas outside Tbilisi and in western Georgia “to defend the lawfully elected president of the country,” the Tass news agency reported Jan. 9. Sukhumi, the capital of the Abkhazian autonomous republic located in southwestern Georgia, also has been a bastion of Gamsakhurdia support. Demonstrations have been held their daily since Jan. 5. A strident Georgian nationalist, Gamsakhurdia was elected overwhelmingly in May in the republic’s first popular democratic elections. His detractors say he then turned dictatorial, jailing rivals and closing opposition newspapers. THE MILITARY council has promised democratic elections by April.

the state Democratic Party, gave Bayh $7,600. AT LEAST SIX insurance companies controlled by Carmel-based Conseco gave $5,000 each, the reports show. The Indiana Bell employees political action committee gave $15,175, PSI Energy’s PAC gave $6,000 and PSI gave a $5,000 corporate contribution. • Pearson: His committee raised approximately $394,000 during the year and spent $182,964. Besides Donovan’s contribution, the major donations were SIO,OOO from United Consumers Club of Merrillville and $5,000 each from Johnny Morris Chevrolet in Muncie, Surgical Associates in Roanoke, Fairmont Homes in Nappanee, Whiteco Industries and Eddie R. Brown of Lynnville. • Johnson: Johnson’s committee spent $89,268, including more than $25,000 to produce and distribute a videotaped biography to tout his candidacy. • Evans: He began 1991 with $823 in the bank, raised $20,109 during the year and spent $18,057 including $17,000 for a poll to gauge his strength against his potential opponents.