Iran 'generally’ accepts terms
From Associated Press Reports
A top Iranian official said Wednesday that
Iran has “generally” accepted the latest, still
secret proposals for resolving the 14-month-old
hostage crisis. But U S. officials said important
issues remained unresolved.
The statement by chief Iranian hostage
negotiator Behzad Nabavi, elaborating on
sketchy remarks Tuesday by Iran’s prime
minister, seemed to confirm that some progress,
perhaps significant, had been made toward end
ing the U.S.-lranian deadlock.
Urgent messages flashed back and forth
across the Atlantic late Tuesday to clarify some
items in the new plan. But details of the proposals
remained undisclosed, and cautious officials on
both sides refrained from saying a breakthrough
was at hand.
“The process aimed at release of our hos
tages continues but a number of important ques
tions remain to be solved,” State Department
spokesman John H. Trattner said in Washington.
Another U S. official said, however, that
agreement had been reached on some "basic
principles.” Iran is prepared to revise its demand
that the United States put $24 billion in cash and
gold in Algeria’s central bank to guarantee even
tual compliance with Iran’s financial demands,
said this official, who requested anonymity.
Since last weekend, Algerian diplomats act
ing as go-betweens in the crisis have been
discussing the latest proposals with Iranian
leaders in Tehran. The Algerians had conferred
for five days last week with U S. officials in an
effort to find acceptable alternatives to Iran’s
$24-billion plan.
On Tuesday, Iranian Prime Minister Moham
mad Ali Rajai said Ayatollah Ruhollah Khomeini
had authorized acceptance of a proposal from
Algeria "to solve our problem with the United
States.”
At a Tehran news conference Wednesday,
Nabavi, who is minister of state for executive
affairs, said the Algerians had made a new
proposal involving unspecified guarantees. “This
subject has been studied and has been agreed
upon generally,” he said
Nabavi's remarks left the nature of the
“guarantees” unclear. At one point, he also said,
"The Algerian government has said in its proposal
that it is ready to accept the undertakings of both
sides, in other words Iran and the United States
can empower the Algerian government with their
undertakings."
Later, official Tehran Radio said, "In these
proposals, the Algerian government is prepared
to obtain a guarantee from the Iranian and U S.
governments."
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Economic outlook grim;
budget deficit expands
WASHINGTON (AP) - Gov
ernment economists are
forecasting a no-growth econ
omy in the next six months, with
inflation and unemployment
persisting at high levels during
Ronald Reagan’s first year in
office, Carter administration
and congressional sources dis
closed Wednesday.
The grim outlooks came as
Reagan's strategists warned the
president-elect that the federal
budget he will soon preside over
is piling up a $60 billion deficit,
far more red ink than they had
expected.
The state of the current bud
get "is far worse today than we
thought even in October,”
Reagan’s budget director
designate Rep. David A. Stock
man, R-Mich., said after he and
other chief economic advisers
met with Reagan.
Stockman said the task of
bringing federal spending
under control “is going to be
even greater than we expect
ed." He added that the advisers
still believe they can cut 2 per
cent from the 1981 budget and
balance future budgets if
Reagan’s tax cut plan goes into
effect.
Stockman said the advisers
and Reagan discussed the state
of the economy and their ideas
for improving economic condi
tions and cutting federal spend
ing.
Speaking to reporters after
the meeting, Stockman and
Donald T. Regan, treasury
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secretary-designate, said that
despite the growing budget
deficit, Reagan intends to press
ahead with his proposal to cut
tax rates 30 percent over three
years.
“If we don’t implement the tax
progam, the deficit will be
worse," Stockman said. “The
economy will falter and we
won't have the revenues that
are being projected ...”
Stockman’s estimate of the
anticipated fiscal 1981 budget
deficit is in line with updated
forecasts hv the outgoing Carter
administration and congres
sional economists. Just two
months ago, government econ
omists were predicting a $30
billion deficit, and last spring,
President Carter vowed the
budget would have no deficit.
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