December 16, 1994

What ever happened to natural gas vehicles? After the oil crises of the 1970's and the clean air laws of the 1980's, the consensus among environmentalists, petroleum executives and state and Federal officials was that the United States would reap economic and environmental rewards from converting millions of vehicles to natural gas.

One year ago, China's Communist Party leadership presented a broad program to restructure, sell or put into bankruptcy thousands of state-owned industries whose heavy losses and inefficiency threatened the country's economic expansion. Endorsed by the paramount leader, Deng Xiaoping, the plan was heralded as a path to fulfillment of China's ambition to create a "socialist market economy" in which free-market forces would guide decision-making. Execution of the plan by 2000 became a national priority.

Mayor Rudolph W. Giuliani proposed tax breaks and zoning changes yesterday to bolster the sagging real estate market of Wall Street and the rest of lower Manhattan. The inducements are intended to encourage new housing and offices in the area and stop any further exodus of businesses. Despite the fame of Wall Street and high-profile sites like the World Trade Center, lower Manhattan's vitality has been drained by outdated office buildings and a lack of housing that leaves streets barren after dark.

The Securities and Exchange Commission's investigation into the Orange County, Calif., bankruptcy has shifted to the county's elected board of supervisors, even as the agency's chairman suggested that voters should throw the five-member board out of office. The S.E.C., late on Wednesday, subpoenaed records of the supervisors that relate to the sale of bonds by the county. But county officials said today that a letter to the board from the S.E.C. assured them that the request for documents "should not be construed as an indication by the commission that any violations of the law have occurred."

Like millions of other children, Marcelo Garzo, who is 10, can't wait to see the presents waiting for him under the tree on Christmas morning. And like a lot of his friends, what he hopes he'll find there is a lot of software for his home PC. The surge in sales this year of a new crop of home computers -- equipped with faster CD-ROM players, rich sound and higher-powered microprocessors than those of earlier years -- has created a boom in software for the home as well. Households with children 17 or younger are expected to spend $1.8 billion on software this year -- about 40 percent of it in the last quarter, according to the Link Resources Corporation, a market research company in New York.

Companies Morgan Stanley and S. G. Warburg broke off merger talks after a deal could not be reached with Warburg's independently run fund-management subsidiary. The dashed deal is a big setback for Warburg of Britain, which had sought an American partner to elevate it to the ranks of global banking powers. [ Page D1. ]

Breaking a long spell of grim news on the AIDS front, a team of New York City scientists yesterday announced a finding that could have a significant effect on the course of the disease for gay men should its preliminary findings be confirmed. Scientists at Columbia University said they had found strong evidence of an apparent newly detected virus that, they said, might cause Kaposi's sarcoma in people with AIDS. Kaposi's is the most common cancer affecting gay men with AIDS, and one of the principal causes of death among that group. For unknown reasons, gay and bisexual men with AIDS are 20 times as likely to develop Kaposi's sarcoma than hemophiliac men with AIDS.

MAYOR PLANS INCENTIVES FOR WALL STREET Mayor Giuliani proposed tax breaks and zoning changes to bolster the sagging real estate market of Wall Street and lower Manhattan. A1. GIULIANI SEEKS CUTS IN AID FOR POOR The Giuliani administration began planning sharp reductions in health and welfare benefit programs for the poor as part of its strategy for handling a $2 billion budget gap. A1.

After a 21-month investigation, District Attorney Richard A. Brown of Queens issued a report yesterday concluding that seven immigrant van drivers working in the Rockaways had falsely accused a male police officer of raping them. Mr. Brown said Officer Reggie Rivera would not be prosecuted because the rapes never took place. The drivers, all of whom are black immigrants working in the illicit van trade on the Rockaway peninsula, had a strong motive to defame Officer Rivera because he had issued thousands of tickets to van drivers and represented a direct threat to their livelihood, the report said.

The Giuliani administration yesterday began planning sharp reductions in health and welfare benefit programs for the poor as a key part of its strategy for handling next year's $2 billion budget gap. In a year-end letter sent to all commissioners, Abraham M. Lackman, the Mayor's Budget Director, said that after a year that saw $2 billion worth of reductions in the municipal work force, the administration's second fiscal plan would rely less on staff and agency cuts and place "more emphasis" on "cutting entitlement programs and mandates."

Since this particular Santa doesn't come around much anymore, the red suit had to be taken out of storage, the beard and wig restyled. He needed a new black belt and, most important, he had to meditate a few hours to get back into character: last time, when asked how he arrived, he said the No. 2 train, causing great consternation. This year, Mark Woodley as Santa took a car service to the State University Health Science Center in the Flatbush section of Brooklyn. There was no visible indication that many of the 100 or so shrieking children that greeted him had H.I.V., the virus that causes AIDS. Each sat on his lap, discussing pressing matters like loose teeth and toys.

For the first two years of his Presidency, Bill Clinton insisted that reducing the Federal budget deficit was his highest calling. Tonight, he reversed course. What is most important is not the details of what he proposed: a variety of tax breaks designed mostly for political appeal and a seemingly pain-free method of raising the revenue to pay for them. The Republican Congress is no more likely to adopt this President's budget offerings than Democratic Congresses were likely to accept President George Bush's.