January 20, 1977

Pres Sadat, after 2d day of widespread rioting and increasing casualties, cancels price increases for food, cooking fuel and other products; violence continues; newspaper Al Ahram repts 21 persons killed, 360 injured and 439 arrested in Cairo and Alexandria in 2 days; Egyptian authorities order curfew in Cairo, Alexandria and Suez; curfew, 1st since '52 overthrow of King Farouk, is defied, and police rept battling with demonstrators in several places; Sadat returns to Cairo from Aswan to deal with crisis; Deputy Prime Min Abdel Moneim Kaissouni, who was responsible for price increases, submits his resignation, but it is rejected by Prime Min Mamdouh Salem; Interior Min blames troubles on Communist agitators and says police will maintain order; map (L)

Labor Dept repts Consumer Price Index for Dec rose modest 0.4%, seasonally adjusted; 4.8% inflation rate for '76 was lowest since '72; rate in '58‐65 period averaged less than 1.5%; most economists see little or no lowering of rate in '77; comments on inflation by Charles L Schultze and Arthur M Okun quoted; charts on Consumer Price Index showing major components and percentage annual increases since '70 (M)

Outgoing Commerce Sec Richardson announces award of $730‐million in loan guarantees to shipbldg div of Gen Dynamics to help in construction of 7 tankers for ferrying of natural gas between Indonesia and Japan; guarantee reptdly is largest ever provided by Fed Govt to single co; action affects 5,000 workers at Quincy, Mass, shipyard; Gen Dynamics chmn David S Lewis lauds move (M)

Poland's Communist leadership reptdly has decided to tackle its domestic dissidents by what it calls ‘political means,’ ruling out arrests, police harassment and outright repression; leadership believes that only small number of people arc involved and that they can be isolated by campaign of propaganda and personal defamation; decision has been to avoid creating any new martyrs or provoking wider dissent, without being seen to give in to demand of dissident intellectuals; Edward Lipinski, who helped organize informal orgn called Workers Defense Com, comments; internal pol situation detailed; illus of Edward Gierek during 71 visit to Moscow as Leonid Brezhnev looks on (L)

Snow reptd in state for 1st time; Gov Reubin Askew declares state of emergency because of potential damage to citrus indus (S)