December 16, 1978

Taiwanese Pres Chiang Ching-kuo denounces move by US; says Taiwan will neither negotiate nor compromise with People's Repub; accuses US of denying 'enslaved' peoples on mainland their eventual freedom; Govt calls off elections to lessen possibility of violent anti-American demonstrations; late Chiang Kai-shek and Mao Tse-tung illus together in '45 (M)

Carter move seen reflecting belief that normalization of ties will not affect SALT or expose Taiwan to attack from mainland; calculated pol risk to his Presidency noted; criticisms of decision and steps leading to normalization discussed (M)

HONG KONG, Saturday, Dec. 16 —President Carter's announcement last night that the United States and the People's Republic of China are finally normalizing diplomatic relations comes nearly seven years after Richard M. Nixon pledged in the Shanghai Communiqué of February 1972 to work toward that goal.

Pres Carter says US will establish diplomatic relations with China on Jan 1 and will terminate diplomatic relations and mutual defense treaty with Taiwan, natl TV speech; says US recognizes Govt of People's Repub as 'sole legal Govt of China'; says new agreement will open new vista of trade relations; says step is not being undertaken for 'transient, tactical reasons; says security of Taiwan is adequately protected under terms of agreement and that US will always be interested in peaceful solution of China-Taiwan issue; says Chinese Deputy Prime Min Teng Hsaio-ping will visit US on Jan 29; is angrily scored by moderate and conservative Cong reprs; Sen Barry Goldwater says decision is 'cowardly act'; Sen Bill Brock says it represents 'callous disregard' for Taiwanese; illus; map (L)

City in default as govt fails to repay some $15.5 million in loans to group of local banks and city treas; as midnight deadline for repayment of loans passed, City Council had not taken any action on fiscal rehabilitation plan proposed by Mayor Dennis J Kucinich; Kucinich declares that council's failure to act on his plan means that as of Dec 18 there will be hundreds of layoffs of police, fire, and other munic workers; Kucinich illus at Council meeting; map shows location of Cleveland (M)