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Senate Republicans
offer budget plan
WASHINGTON
Pres Reagan, his original
budget plan in shreds, chal
lenged Democrats on Thursday
to back an alternative shaped by
Senate Republicans which calls
tor $95 billion in new taxes and
$40 billion in Social Security
cuts over three years
Reagan, at a White House
session with reporters, insisted
that the new plan will “continue
to protect" the basic benefits of
Social Security recipients de
spite unspecified slashes in the
Senate plan.
He added that the outline ap
proved Wednesday by the
GOP-controlled Senate Budget
Committee, after talks between
White House officials and
Republican leaders, will "put
our country firmly on the road to
economic prosperity" if con
gressional Democrats cooper
ate
The Republican compromise
was reached after the panel u
nanimously scuttled Reagan's
original budget, in which
Reagan promised virtually no
new taxes
The new plan would appear to
set the stage for a repeat of last
year's partisan battle over
spending and taxes
But “It will be rather difficult
for them (Democrats) to explain
how they did not want to be a
party to a plan that was going to
reduce the three-year deficit by
$416 billion,” Reagan said
House Speaker Thomas
O'Neill, D-Mass , said it
"provides for walloping defense
expenditures and fails to cor
rect the inequities and excesses
of the Reagan-Kemp-Roth tax
bill. At the same time, it
proposes deep cuts in Social
Security and other vital pro
grams,"
Earlier, Senate Democratic
leader Robert Byrd of West Vir
ginia said the compromise plan
amounted to 'mortgaging the
economic future of the elderly of
this country to finance the
economic folly of the Kemp
Roth tax scheme'' of across
the-board tax rate cuts
Peace talks stall;
two Harriers lost
FALKLAND ISLANDS
Britain and Argentina tailed to
agree Thursday on a cease-fire
in the Falkland Islands conflict
and Britain's naval task force
lost two more Sea Harrier fighter
lets
Prime Minister Margaret
Thatcher said Britain will "con
tinue with our military activi
ties "
The two downed Sea Harriers
disappeared for unknown
reasons, although the cause
could have been bad weather.
Defense Ministry spokesman
Ian McDonald said They were
the first losses for Britain since
Tuesday, when an Argentine
missile demolished the des
troyer HMS Sheffield
McDonald said the two fighter
jets disappeared from radar
screens at 7 a m EOT while
patrolling in the British-imposed
200-mile exclusion zone around
the Falklands
There have been r*o reports of
fighting in the area from either
side since Tuesday
Two different peace propo
sals were under consideration,
one sponsored by United Na
tions Secretary-General Javier
Perez de Cuellar and the other
by Peruvian Pres Fernando
Belaunde Terry
Foreign Secretary Francis
Pym said that the Peruvian plan
for a cease-fire at noon EDT
Friday had collapsed
The Peruvian plan included
Argentine withdrawal from the
Falklands. which were occupied
on April 2
Perez de Cuellar refused to
make public his peace plan, but
informed sources said it includ
ed a cease-fire withdrawal of
Argentine and British forces
from the Falklands area and ap
pointment of a U N administra
tor for the islands while nego
tiations resume to determine
their future The plan reportedly
takes no position on the thorny
question of sovereignty
On Thursday. Britain an
nounced 20 men from the Shef
field were presumed dead,”
while Argentine naval sources
were quoted as saying 240 from
the torpedoed cruiser Gen Bel
grano were missing
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