Banner Graphic, Volume 13, Number 118, Greencastle, Putnam County, 25 January 1983 — Page 2

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The Putnam County Banner-Graphic, January 25,1583

'No rosy economic forecasts' due in State of Union

WASHINGTON (AP) President Reagan, facing strengthened opposition in Congress and the longest recession since World War 11. unveils priorities for the second half of his term tonight, and a White House official says there will be “no rosy economic forecasts.” Delivering his State of the Union address to a joint session of the House and Senate and a nationwide television and radio audience, Reagan will make a "strong bipartisan appeal to attack the economic problems,” said the official, who spoke on the condition that he not be identified by name. Reagan invited Republican congressional leaders to the White House this morning for a briefing on the speech and budget. Deputy White House press secretary Larry Speakes predicted that once Reagan’s congressional allies have had a look at his proposals, they are less likely to object to some of them. The president's reported plan to ask for a contingency tax increase by 1986 if his program fails to bring down the federal budget deficit has met with skepticism on the part of Senate Majority Leader Howard H. Baker Jr., R-Tenn. As late as Monday afternoon, that plan was still under discussion at the White House, a senior White House official said. The president is scheduled to begin the State of the Union speech, marking the start of the 98th Congress, at 9 p.m. EST. The new Congress presents the president with a new political situation.

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Presenting the Nonviolent Peace Prize to movie director Sir Richard Attenborough, Mrs. Martin Luther King Jr. places the medallion around his neck during ceremonies in Atlanta. The prize is awarded in the name of slain former civil

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The Republican congressional leadership is showing less willingness than it did two years ago to go along with Reagan’s plans, and the Democrats have boosted their majority by 26 seats in the House The new scenario, and continued economic problems, has brought pressure on Reagan to propose jobs programs, reduce the planned increase in defense spending, and scale back his planned reductions in spending for domestic programs. In addition, his political standing appears weaker among the voters. A recent Gallup Poll showed that 41 percent of those surveyed approved of the way he was doing his job, a figure lower than that of his recent predecessors at midterm. And a new Washington Post-ABC poll got the same results, putting the approval rate at 42 percent of those it surveyed. One administration official, speaking privately, said that in his message, Reagan will say that “we are going to create conditions that will result in future economic growth and solve the problem of unemployment” During the past year, the rate of joblessness rose from 8.5 percent to 10.8 percent. Officials said the president would include proposals to: —Allow teen-agers to work for a sub-minimum wage. —Delay cost-of-living increases for beneficiaries of certain government programs.

rights leader Dr. Martin Luther King Jr. Attenborough, a British filmmaker, is responsible for the highly acclaimed motion picture “Gandhi,'' currently showing in the United States. (AP Wirephoto).

OPEC stalemate to mean cut?

By ROBERTBURNS AP Business Writer The stalemate among OPEC nations over how to eliminate a world oil glut may lead to lower gasoline prices by spring, but some industry analysts believe the cartel will resolve its differences before a price war erupts. OPEC’s problems threaten the unity of the price-fixing cartel that quadrupled the cost of gasoline in a few years and left millions of Americans waiting on line in cars for hours.

Reagan has no reservation about policy

WASHINGTON (AP) - President Reagan says his administration is committed to easing the plight of the 1.4 million American Indians by allowing tribal governments to “resume control over their own affairs.” In a sever.-page statement Monday outlining the administration’s Indian policies, Reagan pledged to reverse past government efforts which he said were “more rhetoric than action.” The president put his ad-

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Out-of-court agreement reached Three Mile Island suit settled for s37million

c. 1983 N.Y. Times NEW YORK The operator of the Three Mile Island nuclear plant agreed out of court Monday to accept $37 million in settling its suit against the manufacturer of the disabled reactor. The operator, the General Public Utilities Corp , charged that it had suffered $4 billion in damages on March 28, 1979, in the worst accident in the history of commercial nuclear power. The settlement was reached after a trial in the suit had gone on for almost three months The companies were reported eager to bring the trial to an end because further disclosures could damage the future of the nuclear power industry in which both parties had a large stake. But a spokesman for the operator, Renee Leuchten, said the settlement with the manufacturer, the Babcock & Wilcox Co., would have no effect on a similar $4 billion suit the utility is pressing against

“But I wouldn’t go out and buy a gas guzzler based on that.” William Randol, an oil industry analyst at First Boston Corp., a New York investment firm, said Monday. “We don't see prices collapsing.” The Organization of Petroleum Exporting Countries talks, which took place in Geneva, Switzerland, ended Monday when Nigeria and other African nations refused to raise their petroleum prices to make Saudi Arabia’s oil more attractive. No date was set for

ministration on record in support of Indian selfdetermination and promised to address the Indians’ economic plight by promoting free enterprise on reservations. The policy initiative, which was first disclosed last week, brought a lukewarm response from many Indian leaders. “The words sound lovely, but the real Indian policy of this administration was set in the first budget the president sent to Congress, which proposed to cut one-third of the total budget for

—Grant tax breaks to parents saving for their children’s education. —Renew fair housing laws. —Reduce medical costs. Administration officials, speaking on condition that their names not be used, have said the speech would include a general call for “major tax reform,” but that no specifics would be included. Reagan has said that a so-called flat-rate system, under which income tax deductions are reduced and tax rates are lowered, “is a thing we have agreed to look at....” The president was also not likely to include a specific figure for the fiscal 1984 budget deficit, although White House sources have placed it at SIBB billion. The figure will be revealed when the president sends his budget proposal to Congress next Monday. Edwin Meese 111, the president’s counselor, has said Reagan will propose measures intended to balance the budget by the end of the 1980 s something he originally promised to produce by this year. The deficit for the current fiscal year, which ends Sept. 30, is expected to exceed SIBO billion. A year ago, in his State of the Union message, Reagan predicted a 1982 deficit of “less than SIOO billion,” but that grew to a record of $110.7 billion. One White House official, also speaking with the un-

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the Nuclear Regulatory Commission. The utility is charging that the commission, as well as Babcock & Wilcox, had failed to warn of safety hazards. In the trial that began last Nov. 1 in the Federal District Court in Manhattan before Judge Richard Owen, the utility sought to show that the manufacturer was negligent in not providing vital safety information. Babcock & Wilcox had countered by saying that the accident was caused because the utility operated the plant improperly. Part of the settlement

new talks. The stalemate triggered alarm on the New' York Stock Exchange, where the Dow Jones average of 30 industrial stocks tumbled 22.81 points Monday to close at 1,030.17. its biggest dip since Oct. 25. Analysts attributed the slide to worries about the effect of price declines on heavily indebted oil exporters such as Mexico and on the international banking system. The discord among oil producers also disrupted

Indians.” said Suzan Harjo ot the Native American Rights Fund, which represents Indian tribes before Congress and the courts. Reagan’s Indian policy statement was issued five days afer Interior Secretary James Watt grabbed headlines with controversial statements branding Indian reservations as failed examples of socialism. The president’s statement, which had been in the works for some time, took no note of Watt’s comments.

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reached Monday was an agreement “that neither party has established that the other was the cause of the TMI-2 accident and that it would be counterproductive to incur the substantial costs of further litigation in an effort to resolve the issue." In a joint statement the utility and the manufacturer both expressed satisfaction over the settlement. The utility said it had continuing need to buy services from Babcock & Wilcox for the cleanup of the plant, on an island in the Susquehanna River near Harrisburg, Pa.,

trading in volatile commodity exchanges, where prices plunged Monday on contracts for future delivery of heating oil and gasoline. After the talks broke up. the price of heating oil fell 4.82 cents to 78.54 cents a gallon in contracts for February delivery on the New York Mercantile Exchange, while gasoline for February delivery dropped 3.24 cents to 80.51 cents a gallon. Chances are now better than 50-50 that Saudi Arabia w'ill reduce its $34 benchmark price

However, the National Congress of American Indians, the country’s largest association of Indian tribes, was meeting in Washington today and planned to show delegates a tape of Watt’s remarks last week. Watt, on a television interview program, called Indian reservations an example of. failed socialism which had fostered the highest rates of alcoholism, drug addiction and venereal diseases in the country.

Testing for Shuttle leak

CAPE CANAVERAL, Fla. (AP) A 20-second test firing of the space shuttle Challenger’s three main engines may finally pinpoint the source of a potentially dangerous hydrogen leak, officials say. “We’re counting on things going well,” NASA spokesman Hugh Harris said late Monday. “The whole crux of the matter is finding where that hydrogen is coming from.” The countdown for today’s scheduled test began at 9 a m. Saturday, and space agency spokesman Dick Young said that “it looks like a smooth count.” National Aeronautics and Space Administration officials said they would not know for

derstanding that his name would not be used, said Reagan would offer in his half-hour speech “a realistic approach to the deficit anda plan to get itdown.” But, he said, there will be “no rosy economic forecasts “Bold, fair, realistic” are the words being used frequently by White House aides as they sought to portray the tone of the speech. It “will set the tone of progress for the foreseeable future.” said spokesman Speakes. Although the focus will be on the economy, one official said Reagan would restate “the basis for our relationship with the Soviet Union” and would offer an overview of his arms control proposals. Reagan spent much of Monday afternoon working on the speech, which had undergone several drafts at the hands of speechwriters and senior aides. “The president’s draft differs substantially from the draft that was submitted to him,” Speakes said. Reagan’s aides have said that in the speech, the president will attempt to clear up misunderstandings about his economic program. He will seek to “re-establish himself as a central figure and as one who helps to set the agenda for the coming year,” said David R. Gergen, Reagan’s assistant for communications.

and that the settlement would help pay for that cleanup. The $37 million is to be paid to the utility in the form of rebates on services that Babcock & Wilcox will perform in the cleanup operation over the next 10 years. “We’re pleased that a settlement has been reached that is beneficial to both sides,” said John Lynott, executive vice president and chief financial officer of McDermott Inc., the parent company of Babcock & Wilcox. Speaking from the company headquarters in New Orleans, Lynott said that even

High court to rule on Death Row cases WASHINGTON (AP) The fates of some 1,150 Death Row' inmates in America will be affected when the Supreme Court rules on how low er courts should handle last-minute delays in executions. At stake could be months, even years, of added court battles and execution delays. The court set the stage for the ruling Monday by dramatically halting today’s scheduled execution of Thomas Barefoot, convicted in Texas of killing a policeman. In other developments before beginning a four-week recess, the court: —Rejected a special plea from the Reagan administration to restrict busing for racial desegregation. The court refused to allow reduced busing and greater racial imbalance in Nashville, Tenn., public schools. —Agreed to decide in a California case when courts may exclude the public and media from jury selection in potential death penalty cases. The court has previously upheld a constitutional right to public trials. —Said it would examine whether the Atlanta law firm of former Attorney General Griffin B. Bell may be found guilty of sex discrimination. A woman lawyer who was dismissed from the firm filed the lawsuit. In the death penalty case, the court granted a hearing on April 26 for Barefoot to decide how emergency appeals in capital punishment cases should be handled. It will announce a ruling by July. The court intends to use Barefoot’s case to guide federal appeals courts in granting or denying stays of execution. Defense lawyers said the decision will be vital to the lives of all Death Row inmates.

several days whether whether the leak had been found. The leak of hydrogen within, or into, the tail-section engine compartment has mystified technicians since shortly after the first engine test on the new shuttle on Dec. 18. The discovery forced NASA to postponement Challenger’s first mission by more than a month until late February at the earliest. Lt. Gen. James A. Abrahamson, director of the shuttle program, said there was concern for the safety of the shuttle and its crew. Harris emphasized that “this is nothing like the Hindenburg,” referring to the German zeppelin whose hydrogen-inflated gas bag exploded over Lakehur-

with the rebates, his company expected to make money on the cleanup operations at Three Mile Island. “We’re pleased to have this work,” Lynott said. The direct damage to the plant was estimated at $1 billion and so far the utility has spent S3OO million in the cleanup operation. The utility says it also suffered $3 billion in economic damages because it has not been able to use the plant, Three Mile Island No. 2, or a sister plant. Three Mile Island No. 1, to generate power. The- No. 1 plant, which had been shut down at the time of the accident but was due to be restarted, has not been allowed to go back on line because of questions that were raised as a result of the accident. In the accident at the nuclear plant, the operators did not realize until it was too late that the core of the reactor was losing cooling water and overheating to the point of damage.

st, N.J., in 1937, killing 36 people. “We’re talking about a relatively small amount of hydrogen.” But he added: “By the time we got 80 seconds into the flight, the gas would be at the lower margin of flammability. There could be an explosion if two other failures occurred: the entry of oxygen into the area and an ignition source.” The test was ordered after exhaustive checks of the spacecraft failed to show the source of the leak. “If the hydrogen is coming from outside, there’s no problem,” Harris said. “If the leak is inside, the test should show us where.”