December 6, 1975

Spanish King Juan Carlos I decides to retain Carlos Arias Navarro as Prime Min, move that seems to satisfy rightists and disturb liberals and leftists; 19 mins offer resignations to Arias, who is expected to make major Cabinet changes; King, earlier in wk, chose Torcuato Fernandez Miranda as Parliament Speaker; Christian Dem leader Joaquin Ruiz Gimenez, who was to discuss amnesty at Madrid Univ, is forbidden by univ authorities to speak; had brought with him Communist labor leader Marcelino Camacho Abed, who was released from prison Nov 31; no reason is given for restriction (M)

Pentagon officials say size of fiscal '77 defense budget depends in large measure on pol chess game being played between Defense Sec Donald H Rumsfeld and Mgt and Budget Office Dir James T Lynn; say Lynn appears to have upper hand in imposing cuts in projected defense budget; say at recent White House meeting, Lynn prevailed on Pres Ford to agree on tentative cuts of $6.8-billion, bringing defense budget down to level of $110-billion in appropriations and nearly $7-billion below level that Ford had projected; say among proposed cuts were 37,000-man reduction in mil strength, now totaling 2.1 million, and 48,000-man reduction in Pentagon's civilian payroll of about 1 million persons; note that 'information memorandum' prepared by Asst Defense Sec Terence E McClary said White House is also proposing 5% ceiling on mil and civilian pay increases, 40,000-man cutback in mil reserves and delay in start of new nuclear-powered aircraft carrier and nuclear-powered strike cruiser; Rumsfeld agrees with his predecessor, James R Schlesinger, that there should be steady 'real growth' in defense budget, over and above inflation; says 200,000-man reduction in mil strength, which Schlesinger has warned would be result of original defense budget proposed by Adm, would be unaceptable to him; Lynn is primarily interested in implementing Ford's proposal for $28-billion reduction in projected growth of Fed spending in '76 (M)

Complex arrangement under which US grain is transported to USSR appears to have been jeopardized by new dispute over freight rates; Asst Commerce Sec Robert J Blackwell says that USSR officials have indicated unwillingness to pay anything above mkt rates for US vessels to ship grain after Dec 31, position that could make it unprofitable for US ships to carry cargo and thereby provoke renewed reaction from US longshoremen; US officials seem mystified that USSR would take such position now when harvest has been worst in decade and risk US union reaction; USSR has contracted to buy some 13-million tons of US grain and Blackwell estimates that only 4- or 5-millions tons have been shipped so far (M)

SAN FRANCISCO, Dec. 5—The Federal prosecutor said today that the Government had a written record, some of it probably in Patricia Hearst's handwriting, of Miss Hearst's apparent kidnapping and the bank robbery of which she is accused.

The stock market declined sharply yesterday in a continuation of the weakness experienced earlier in the week. The Dow Jones industrial average fell 10.31 points to 818.80 at the close. The decline in the indicator for the week amounted to 41.87 points, the largest weekly drop since September 1974. Details on Page 41.

Assembly minority leader Albert H Blumenthal on Dec 6 is arraigned on indictment that he lied under oath about his intercession for nursing home promoter Bernard Bergman; pleads not guilty to all 8 counts; issues statement calling indictment 'unfounded and outrageous' and motivated by 'pol sensationalism'; with assent of special state prosecutor Charles J Hynes, is released in his own custody; is 19th person indicted by special prosecutor's office since last June; Howard Wilson, chief asst prosecutor who directed Blumenthal inquiry, notes that 117 persons have been mentioned in files of former NYS Health Comr Andrew Fleck as having interceded with Health Dept; Assembly Speaker Stanley Steingut is reptdly among those under investigation; Blumenthal indictment concerns his testimony last Feb before Temporary State Comm on Livings Costs and Econ, about his meeting with state health officials in Apr '71; Blumenthal says he appeared at meeting at request of Bergman to learn why NYS was holding up final approval of Park Crescent Nursing Home, NYC; 4 officials have testified that Bergman was not there; says Blumenthal cited Towers Nursing Home, other Bergman facility, as 'spotless'; at issue is whether Blumenthal defended Bergman against charges of bad conditions at the Towers; Blumental says Dr George Warner, chief of long-term are for State Health Dept, gave sworn testimony before Stein comm that differed with statement to grand jury; Blumenthal case is assigned to Justice Harold Birns; preliminary hearing is set for Dec 12; Blumenthal illus (M)

PLO repr attends meeting on Israeli air attacks against targets in Lebanon; Israel boycotts it, charging Council violates Charter by inviting PLO (M)

Fed grand jury is looking into possibility that James R Hoffa's body was stuffed into 55-gallon steel drum at Gateway Transportion Co trucking terminal and taken from Detroit; terminal mgr Edwin Streicher says he and 5 other employes have appeared before grand jury; says they were asked if particular drum was missing from end of July to Aug 10; Fed investigators, who assume that Hoffa was murdered, are looking for body in NJ and Mich; informed sources deny repts that FBI is searching for Hoffa's body in Brother Muscato's Dump in Jersey City; say chances of finding body are remote; pres of Gateway Transportation is John A Murphy, who is trustee of Teamsters pension funds and close associate of union pres Frank E Fitzsimmons; Murphy on Oct 9 played in golf tourn at Carlsbad, Calif with former Pres Nixon, Fitzsimmons and 2 other Teamsters officials; illus of Salvatore and Gabriel Briguglio and Thomas Andretta, who allegedly participated in abduction and murder of Hoffa, after their appearance before grand jury in Detroit (M)

Article on nationwide job hunts by some NYC employes dismissed in fiscal crisis; policemen, firemen and teachers particularly seek out-of-state jobs, but few are successful; policemen who won out-of-state jobs comment; illus (M)

Igor Mestchersky, who played role of a thief on TV show To Tell the Truth, is arrested, NYC, and charged with being a real thief after Dutchess County policeman recognizes him while watching show at home (M)

US Sen overcomes attempted filibuster and votes 57-30 to authorize $2.3-billion in short-term Fed loans to save NYC from bankruptcy; 16 Repubs join 42 Dems in approving legis, after voting 70-27 to end debate; Sens Barry Goldwater, Mike Mansfield, John G Tower, James B Allen, James L Buckley, Abraham A Ribicoff, Sam Nunn and Harry F Byrd comment; loan legis revd (L)

Brit Govt announces end of its controversial policy of detaining terrorist suspects in N Ireland without trial; releases last 46 people held under policy from Maze Prison near Belfast; Govt official says detention without trial has 'outlived its usefulness'; since policy was adopted in Aug '71, 1,981 men and women were held without trial; in '75, 1,260 persons were tried on charges connected with terrorism; Brit Sec for N Ireland Merlyn Rees says it is now up to leaders of Prot majority and Roman Cath minority of N Ireland to see that there is no need to restore detention policy; end of policy is welcomed by both Rev Ian Paisley, hard-line Prot, and Gerry Fitt, head of Cath Soc Dem and Labor party; both say move deprives IRA Provisionals of prime emotional issue; Brit Conservative party, which introduced policy, condemns its abolition as 'dangerous' for people of Ulster; Conservative statement comes from Airey Neave, party spokesman on Ulster affairs, after he consulted party leader Margaret Thatcher; in Dublin, pol wing of IRA Provisionals, Provisional Sinn Fein, says in statement that Rees's timing is geared toward 'whitewashing' Brit system of justice at time when Irish Repub is pushing criminal law jurisdiction bill through Parliament; Primate of All Ireland, William Cardinal Conway, hails end of detention; Brian Faulkner, who as Prime Min of N Ireland in '71 urged Brit Prime Min Edward Heath to initiate policy, calls ending of detention 'appalling gamble' (M)