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Show What has happened in Iran ,: during the past month and a 'K4II and what will happen in jr-fJhe weeks immediately ahead i Jqould have considerable im-rTpact im-rTpact on the U.S. economy in !.;i980 as well as on Washing-: Washing-: .ton's policies and programs. r- - ' i :t FOR ONE thing, the new :5Xress on military prepared-;Vness prepared-;Vness and domestic energy 'output will mean that efforts fj,Cq balance the federal :: j;overnment's budget will go jiithering on the vine. Coming, too, in the wake Oi U.S. embassy takeovers in Iran and Pakistan, sack of our embassy in Libya, and the abortive attempt on its counterpart coun-terpart in Kuwait will be a step-up in security of personnel, person-nel, buildings, and documents at all our foreign diplomatic missions. 1980 will also see changes in U.S. intelligence-gathering intelligence-gathering operations abroad and extensive re-examination of U.S. foreign policy and foreign aid. BY ITSELF, the cut-off of oil imports from Iran won't make for big, widespread oil shortages here in the U.S., at least not in the period directly ahead. This assumes that greed and allocations mismanagement mis-management can be kept to a minimum. But over the intermediate term and beyond we will likely have to face up to spreading cutbacks in oil output out-put .that will be dictated by the needs or whims of individual OPEC member nations. IT IS then that domestic supply shortfalls of oil and gasoline could become more serious, especially if we have not by that time taken definite steps toward domestic energy production incentives that will more nearly approximate those going to encourage con-. con-. servation. Tight oil: supplies and the : new testing.,,pf American . strengthR,en'durance, and K flexibilityrthatwe expect are , bound tahike costs ana result in added uncertainties. Without doubt, they will make it more difficult to stop the upward march of inflation. They could make for a somewhat longer and deeper recession than the Babson's Reports research staff now expects, though on the whole we believe that new policies and programs coming on stream in 1980 will give the economy fresh impetus. FEDERAL outlays for detense are sure to be expanded ex-panded substantially as new projects for beefing up our conventional military and naval forces encounter con-' siderably less opposition than in recent years. But, initially, increased ship strength for our naval fleets will still be slow to get underway. And there are bound to be r some rough times,ahead .fp&s Pentagon chiefs as Congress ; investigates the shortcomings of U.S. military intelligence in Iran, Pakistan, Saudi ' Arabia. . .as well as in -; Nicaragua and other. Latin American nations. MILITARY pay levels will -be increased and there will be'; newquestiDns about the' wis-ji dom of relying onvojunteer army.'Congressional'thinking on reviving selective service -; registration is changing and, j despite the fact that 1980 will be an election year, the need- ed approval may be forth- 1 coming. i Finally, our forecast is that the boost in federal outlays for the military will be in the neighborhood of 10 percent. UNCLE SAM'S larger outlays for energy and for beefing up military programs are bound to increase the Treasury's needs for revenues. .But although federal spending will be rising ris-ing substantially in 1980 and ensuing years, inflation, recession and certain inequities inequi-ties built into the U.S. tax system assure that Congress will vote for and the President will sign a tax cut during the coming year. Beyond 1980, however,. " pressures fonnew federal tax income will become acute. That is why Congress is already considering the pros and cons of a value-added tax and will be continuing its search for new levies as well as for additional government-planned government-planned income redistribution. redistribu-tion. .-vV--.-" , WHILE THIS search could lead to " massive-" ' tax "reform," more likely it will result in enactment of a series of iar-reaching tax changes encompassing little or no real reform. |