April 1, 1995

Republican governors and the Republican leaders of Congress are negotiating major changes in Medicaid that would limit the soaring cost of the program and vastly increase the states' power over it. The proposal, if adopted, would give the states new authority in deciding eligibility, benefits and methods of paying doctors and hospitals for the care of 36 million low-income people.

President Hafez al-Assad of Syria was reported by Israeli officials today to have agreed to establish relations with Israel in return for getting back the Golan Heights, which his country lost in war 28 years ago. The officials said Mr. Assad had told Secretary of State Warren Christopher two weeks ago that he would allow Israel to maintain "a low-level diplomatic representation" in Damascus even before it completes a withdrawal from the Golan Heights.

Accomplishing what two Mayors before him had tried and failed to do, Mayor Rudolph W. Giuliani won final agreement yesterday to merge the transit force with the New York City Police Department, after promising to maintain roughly the present level of officers patrolling the subways. The change will take effect tomorrow morning. Under an agreement with the Metropolitan Transportation Authority, the state agency that runs the transit police, the Mayor pledged to keep an average of 1,023 officers policing the city's 230 miles of subways and 469 stations each day.

Republican Mayors call the shots in New York and Los Angeles. Republicans control Congress, and talk radio everywhere echoes Republican dreams and schemes. But Chicago belongs to Mayor Richard M. Daley, a throwback to the days when big-city mayors usually came in only one flavor: Democratic. The oldest son of the city's legendary political leader, Richard J. Daley, Richard Michael Daley is the soul of a new machine; a Democrat with the instincts of a Republican, a self-professed outsider who ritually bad-mouths "the bureaucrats in Washington." He says he has no serious beef with the Republican revolution, and he preaches privatization, big development and small government.

Russians Report City's Fall The last city in the separatist region of Chechnya has fallen, Russian forces said. But the rebels are expected to continue to wage a guerrilla war in the mountains. Page 3. Dollar Falls to Postwar Lows The dollar plunged to postwar lows against the German mark and the Japanese yen. Stocks closed mixed in tumultuous trading. Page 35. More Curbs Sought on Iran Secretary of State Warren Christopher has recommended that the U.S. ban most trade with Iran, Administration officials said. Page 5. Lives Saved, and Lost At a House hearing on repeal of an assault weapons ban, each side produced witnesses who told of guns' effect on their lives. Page 26. A Reminder Daylight savings time resumes at 2 A.M. tomorrow. Clocks are set ahead one hour.