August 28, 1981

To most people in the lower half of Manhattan, Manhattan Cable Television is an entertainment company. But to banks and large companies, Manhattan Cable is also a telephone company. Those banks can use the cable, instead of New York Telephone lines, to send data from one of their buildings to another. And if John Gault, president of the cable company, has his way, those businesses will also be able to use the cable to communicate by voice from one of their buildings to another. Manhattan Cable is at the forefront of change in the telephone business. The last vestige of the American Telephone and Telegraph Company's near-monopoly - local telephone service -is being pierced.

At a point when economists of various leanings are urging President Reagan to take steps to calm the financial markets and thereby bring down interest rates, the Administration contends that the President is already responding with substantial efforts to keep Federal spending in check. Administration officials say the entire tenor of current discussions over the Defense Department budget has changed because of the Administration's renewed determination to bring down projected Federal deficits and achieve a balanced Federal budget in 1984. In budget cutting, military spending had heretofore been considered untouchable - as officials openly and repeatedly stated - but now it is subject to cuts, they say. Further, according to Edwin L. Dale Jr., spokesman for the Office of Management and Budget, the Administration's budget officers are warning Congressional appropriations committees that the Administration will insist on cuts in projected spending greater than those envisaged by the budget bill approved by Congress last month. Vetos of appropriation bills are being threatened.

International Jimmy Carter praised the policy of the Reagan Administration toward China as ''compatible'' with his own. The former President, who is visiting China, said that, if he were still in the White House, he would also have offered to sell defensive weapons to the Chinese as President Reagan has proposed. (Page A1, Columns 4-5.) Washington warned North Korea of ''serious concern'' over the firing of a North Korean antiaircraft missile at an Air Force high-flying reconnaissance craft Wednesday and vowed that the United States would take all steps necessary to assure the safety of its pilots and planes. (A1:5-6.)

Canadian air traffic controllers asked the Canadian Government today to stop all flights between Canada and the United States, but the Government refused. The controllers' union, the Canadian Air Traffic Control Association, charged that flying conditions in the United States were unsafe because of the continuing strike by their American colleagues. William Robertson, the union's president, referred to more than three dozen air incidents that, he said, proved the lack of safety.

The United States expressed ''serious concern'' today over the firing of a North Korean antiaircraft missile at an Air Force reconnaissance plane yesterday. Washington also warned that it would take ''whatever steps are necessary to assure the future safety of our pilots and planes.'' The American statement, issued by the State Department, was accompanied by a call for a special meeting of the Korean Military Armistice Commission to meet at Panmunjom in the demilitarized zone between North and South Korea on Saturday to discuss the incident. Dean Fischer, the State Department spokesman, said the United States was able to ''confirm'' that North Korea ''fired a missile at a U.S. Air Force plane flying in South Korean and international air space.'' He said it was one of a number of ''routine'' flights conducted for years in the region.