What was going on when I was born?

FRIDAY, MAY 10, 1985 The Economy The Senate early this morning tentatively approved by one vote, 50 to 49, a 1986 budget that would limit the military spending increase to the inflation rate and eliminate the Social Security cost-of-living increase for one year. [Page A1.] The President's tax plan has made accommodations to ''political realities'' regarding charitable contributions, capital gains and business depreciation, the White House chief of staff said. [D2.] New York State has begun an effort to preserve the deductibility of state and local taxes. [A1.]

New York has begun using its economic and political leverage in an effort to preserve the Federal income-tax deduction of state and local taxes, which President Reagan is expected to ask Congress to repeal. Governor Cuomo and a number of business, labor and civic leaders -seeking to go on the offensive before Mr. Reagan makes his proposal -have been talking to members of Congress and trying to mobilize a lobbying campaign by voters in New York and other states. As the Administration's tax plan takes shape, the President reportedly is easing his stand on taxing charitable contributions and capital gains and on business depreciation. [Page D2.] Mr. Cuomo, in a demonstration of how strongly he feels about the local-tax deduction issue, told a gathering of contributors to the Democratic Senate Campaign Committee last week that he would not help out-of-state Congressional candidates raise money in New York if they opposed the state's position.

The Federal Aviation Administration has drafted a plan to tackle one of the big remaining problems in aviation safety - the performance of pilots and other employees in the industry. The plan calls for pursuing a list of projects to address 30 ''human factor'' issues ranked in order of importance. Most of the projects are aimed at preventing pilot error, with emphasis on assuring that the accelerated use of automation in aircraft and ground equipment does not increase the workload in the cockpit. ''This is the first time that the F.A.A. has taken a comprehensive look at the one link in the entire chain of aviation operations, the human being,'' said a spokesman, Dennis Feldman, ''Previously, it has been mostly piecemeal.''

Under this heading, The Times amplifies articles or rectifies what the editors consider significant lapses of fairness, balance or perspective. An obituary last Friday reported the death of Milton S. Eisenhower, the diplomat and educator.

The Republican-controlled Senate voted early this morning by 50 to 49 for a 1986 budget that would limit the military spending increase to the inflation rate and eliminate the Social Security cost-of-living increase for one year. The Republican victory required the vote of Vice President Bush to break a 49-to-49 tie. And the Republicans were that close only because they brought Senator Pete Wilson of California from a hospital to the Senate chamber to vote yes, a day and a half after his appendix was removed. Twelve hours earlier, Senator Bob Dole, the majority leader, announced that President Reagan had agreed to the proposal. The President's support came despite reservations about both the millitary and Social Security provisions, according to White House officials. For the military budget, the agreement by the President appears to spell the end of the rapid buildup he has sought since taking office in 1981.

Because of a transmission error, a dispatch from Strasbourg, France, yesterday about President Reagan's appearance before the European Parliament incorrectedly rendered a phrase of his speech. He accused the Soviet Union of ''undermining stability and the basis for mutual deterrence.''

FRIDAY, MAY 10, 1985 International President Reagan, in Lisbon, told Portugal's Parliament that he had ''heard the voice of the 20th century'' on his 10-day visit to Europe and that Communism was losing out to democracy. ''Everywhere we turn,'' he said, ''there is an uprising of mind and will against the old cliches of collectivism.'' [Page A1, Column 1.] The Soviet Union marked V-E Day with parades after a year of commemorations that confirmed the ''Great Patriotic War'' as a primary event in Soviet history. [A1:2-3.]

The 12th grader's report card arrived home the other day from Freeport (L.I.) High School. It read as follows: History, 95; Humanities, 93; Social Studies, 94; Advanced Placement Physics, 91; Math, 99. There was no line on the report card, however, to record the most remarkable fact of all: Three years ago the boy did not speak a word of English. The boy, Ngoc, a slim 18-year-old with intense black eyes and a ready smile, is one of 563 Vietnamese boat children who have been placed in foster homes in the New York metropolitan area. These are the children who fled from the Communist Government in Vietnam, leaving their families behind and setting out in overcrowded fishing boats across the South China Sea for refugee camps in Hong Kong, Malaysia, the Philippines, Singapore and Indonesia.

For four years the question has been when and how President Reagan's military buildup would end. The answer may have emerged in the latest compromise budget plan, even though it was defeated in the Senate early today. In one of the major concessions of his Presidency, Congressional and White House sources said, Mr. Reagan agreed Thursday to a 1986 budget that would have included no increase in military spending beyond one to make up for inflation. The forces that apparently led Mr. Reagan to accept a cap on four years of record military spending are the re-election concerns of Senate Republicans and the political realities that have been steadily building around the Federal deficit since the election last November.

Friday A YEOMAN PRODUCTION A lavish new production of one of the grandest of Gilbert and Sullivan operettas is the final presentation of the New York Gilbert & Sullivan Players' current season. Set in the time of Henry VIII, ''The Yeomen of the Guard'' is rendered against the backdrop of the Tower of London and offers up splendid Beefeater guards, cavalier gentlemen, a comic jailer and a colorful pair of street singers, among other characters. The Gilbert & Sullivan chorus is accompanied by a 27-piece orchestra, with the artistic director, Albert Bergeret, conducting. This weekend's performances will be held today at 8 P.M., Saturday at 3 and 8 P.M. and Sunday at 3 P.M., at Symphony Space, Broadway and 95th Street. Tickets are $11 to $22, with reduced rates for children and the elderly. Information: 873-8660.

Not long after Edward F. Hutton opened his stock brokerage in San Francisco in 1904, the firm's resiliency was sorely tested. The San Francisco earthquake of 1906 leveled the city, but the manager of Mr. Hutton's office uncovered its records and made his way to a telegraph office in nearby Oakland to continue placing customer orders. E.F. Hutton & Company, now one of the country's largest brokerages, has just been shaken by another sort of tremor. Last week, Hutton pleaded guilty to Federal charges that it had defrauded numerous small banks of millions of dollars through a check-writing system that gave it interest-free loans. The Wall Street house was fined $2 million and has set aside $8 million to repay the banks. And although Hutton has received a temporary waiver from a Securities and Exchange Commission rule that bars brokerages that are guilty of such frauds from certain underwriting and advisory activities, it still must seek a permanent waiver later.

A Federal judge ruled yesterday that the United States Government could not be forced to contribute to a $180 million fund to aid Vietnam War veterans who say they were harmed by Agent Orange. But the judge held that while the Government ''is within its legal rights in refusing to contribute'' to the fund set up by Agent Orange manufacturers, its position ''may be cruel to the veterans who served their country and feel that the government has turned its back on them in this litigation.'' The judge, Jack B. Weinstein of Federal District Court in Brooklyn, who has been presiding over the long and complex Agent Orange litigation, also said the Government's position ''may be shortsighted in its refusal to assist contractors who voluntarily produced at Government request what amounted to critical war supplies during a foreign crisis.'' Judge Weinstein declared: ''Undoubtedly, the United States will pay a high price for its present position. In the future many contractors will require indemnification, and increased insurance costs will be added to the price of the goods the Government purchases. There will be lingering resentment by veterans and their families who believe that the Government has let them down.''