January 8, 1975

illus of Chase Manhattan Bank chmn David Rockefeller viewing coffin of NYC Ptl Michael W McConnon, killed during Jan 3 holdup of Chase branch in Gramercy Park, NYC

Gov Carey calls off apptmt of 2 prominent lawyers to investigate nursing home indus because 1 of them decided not to take job and the other appeared to have indirect link to indus; had scheduled news conf to announce naming of Bernard Nussbaum, formerly of HR Judiciary Com's impeachment staff, as special prosecutor, and Morris B Abram, of law firm of Paul, Weiss, Rifkind, Wharton & Garrison, as head of Moreland Act investigation comm; official close to Carey confused 2 posts and told NY Times that Abram would be prosecutor; Abram says he never represented any nursing home interests; another aide says it is now fairly certain that apptmt will not go to Abram; Carey, upon learning that Abram's law firm was mentioned indirectly in NY Times series on nursing homes, instead simply announces that he will name special prosecutor and comm under Moreland Act and will order hiring of 54 more auditors by NYS Health Dept; Carey comments on reptd ties to nursing home figures of Atty Gen Lefkowitz and Assemblyman Steingut; Carey illus (M)

EEC adopts plan to create $10 to $12‐billion facility to be guaranteed by IMF to finance balance‐of‐payments deficits; plan involves investment of surplus revenues of oil‐producing countries through IMF (L)

some Ford Adm energy planners say they fear Pres Ford's emergency energy policy—calling for $3‐a‐barrel tax on crude oil—will send shocks through depressed econ, aggravate recession and possibly provoke new increases in price of foreign crude oil; Ford reptdly concluded that higher taxes on crude oil will be best way to discourage energy consumption; major factor in decision is reptd to be collateral fact that oil taxes will raise revenue—about $15‐billion a yr—needed to finance econ‐reviving tax cut that would not add significantly to deficit in Fed budget; Adm believes Cong will enact gas tax, which will add 7c to 10c a gallon to price of gasoline (M)

4 former nursing home inspectors for City Health Dept testify Jan 7 that their highly critical repts on substandard nursing homes had been suppressed by superiors, who renewed homes’ licenses over objections of inspectors, testimony before hearing of Temporary State Comm on Living Costs; 2 other witnesses testify that their relatives died soon after having been put in nursing homes because of neglect and inadequate care; comm chmn Assemblyman Stein calls such practices ‘scandalous’ and calls for Mayor Beame to make full and complete investigation of City Health Dept's policy concerning nursing homes; says he will turn testimony over to City Investigation Comr Nicholas Scoppetta; officials named by inspectors include Al Schwarz, asst comr of evaluation and inst rev for Health Dept, his predecessor Dr Florence Kavaler and her predecessor Dr Herman Bauer; nursing homes owned by Bernard Bergman, Eugene Hollander, Charles E Sigety and Hyman Solnick figure in testimony; Dr David Goldstein testifies that many elderly patients brought from nursing homes to Kings County Hosp were dehydrated, ulcerated, grossly infected, in shock and suffering from other conditions indicating lack of med attention; illus

N Vietnamese forces overrun and capture Phuoc Binh City, Phuoc Long Prov capital, after wk‐long siege, striking significant psychological blow to S Vietnamese Govt; loss of town, with population of 26,000 montagnard tribesmen, reptdly is of little mil consequence; Vietcong's Provisional Revolutionary Govt asserts that aim of current stepped‐up mil campaign is to ‘force’ US and S Vietnamese Govts to implement 2‐yr‐old Paris peace agreements; S Vietnamese Pres Nguyen Van Thieu's Govt not expected to take pol and mil risk of attempting to retake Phuoc Binh; informed mil sources say Communist troops have driven regional forces from top of Nui Ba Mt, thus giving N Vietnamese forces superior forward artillery observation position; capture of mt seen as mil threat to Tay Ninh, which has population of 250,000; montagnard militiamen's recent loss of Ba Ra Mt recalled; Western diplomatic sources say N Vietnamese, who had reptdly committed 5,000 to 8,000 soldiers to fight, have suffered heavy casualties in attack on Phuoc Binh; illus of S Vietnamese protesters at truce supervision hq and map of area under siege (L)

Gov Hugh L Carey will ask in State of State message that Gov be empowered eventually to appt all judges down to county level and that in meantime law be changed to prevent statewide judicial primary challenges of sort that saw Jacob D Fuchsberg elected as insurgent to Appeals Ct this yr (M)

NYC reluctantly accepts 9.4% interest rate on $620‐million worth of short‐term notes from consortium of firms headed by Chase Manhattan and First Natl Banks; Mayor Beame and Controller Harrison Goldin, in joint statement, denounce rate as ‘unfair, unwarranted and outrageously high'; assert rate does not reflect ‘A’ rating recently given city's bonds by Standard & Poor's and Moody's Investors Service; say city is being victimized by lending insts and call for meeting with leaders of financial community to avoid repetition of incident; Goldin's attempts to find alternative to group's bid detailed; text of Beame‐Goldin statement

NYS Deputy Atty Gen Joseph A Phillips, chief asst to special state prosecutor Maurice H Nadjari, charges that NYC Cultural Affairs Comr Irving Goldman lied when he denied being pres of dummy candy co that was set up to funnel thousands of dollars in payoffs to NYC Transit Auth policemen and officials; describes alleged scheme whereby Goldman siphoned off close to $200,000 from Jola Candy Co in last 4 yrs and made money ‘available for corrupt purposes'; charges are made in affidavit filed with Sup Ct Justice John M Murtagh Dec 4 and unsealed Jan 7; Murtagh, on basis of document, authorizes Nadjari to resume grand‐jury investigation into Goldman's finances; had suspended temporarily grand jury's inquiry in Oct, questioning Nadjari's jurisdiction in case; also directs Goldman to comply with subpoena to turn over to Nadjari all records, checks, ledgers and bank accts dealing with Jola Candy; grand jury has heard testimony that systematic payments were made to provide protection for merchants and obtain promotions for transit police officers; has also heard from 4 transit officers that records were falsified to show that crime in subways had decreased during evening hrs; affidavit contends payoffs were also made to Transit Auth employes for protection for coin pickups taken from vending machines in city subway stations; Goldman for time was vp of Interboro News Co, which operated all of more than 6,000 vending machines in city subways; Transit Auth spokesman notes that auth gen counsel John G deRoos is ‘cooperating fully’ with Nadjari inquiry; Goldman por (L)

Chrysler Corp, in 1st significant attempt to reduce prices to stimulate car sales since auto indus went into its deep recession, will announce system of rebates that will save buyers of certain new cars from $200 to $400; program, which will last from Jan 12 through Feb 16, is aggressive attempt by Chrysler to reduce its huge 120‐day backlog of unsold cars and pry customers away from its competitors; will be announced in TV ads during Super Bowl football game; Chrysler has committed $10‐million to program; program detailed; Warner Elec Brake & Clutch Co says it will pay its 1,700 employes $100 and that auto dealers will match amount if employes purchase new Chrysler or Amer Motors car between Feb and May (M)

Sec Kissinger has told his closest aides he wants to make ‘massive effort’ to persuade Cong to give him more flexibility and end what he regards as unwarranted interference in day‐to‐day conduct of foreign affairs; sets meetings with leaders and new members of 94th Cong and preliminary work on major speech in which he will appeal to Cong to avoid legislating specific policy restrictions; long‐time Cong aide comments on problem, saying Cong would be interested in new ideas from Kissinger on strengthening bipartisanship; some Kissinger comments on mounting Cong criticism of him and some Cong actions contrary to Kissinger policies revd (L)

Israeli Premier Yitzhak Rabin says Israel would be prepared to give Abu Rudeis oil fields back to Egypt in return for true peace (S)