House conferees offered a compromise aid package for Turkey yesterday, but it promptly was rejected by Senate conferees and the Carter administration.
The action came as a House-Senate conference committee was set to meet to resolve differences about $50 million in military assistance to Turkey that has become tied up in U.S.-Turkish relations and the debate on verification of the SALT II treaty.
The rejection caused a postponement of yesterday's meeting to give both sides additional time to find an acceptable compromise.
The Senate approved the $50 million as a grant to Turkey after intensive lobbying by the administration. But last week the House, in a slap at the administration, voted overwhelmingly to instruct its conferees to insist that the $50 million be in the form of a loan. The House action caused Turkey's top military commander to assert that "under the circumstances, Turkey would not allow U2 flights over Turkey."
Since the loss of U. S. intelligence-gathering posts in Iran, the use of the high-altitude U2s along Turkey's border with the Soviet Union has been seen as one of the principal ways of monitoring Soviet compliance with the new strategic arms limitation treaty.
House leaders said yesterday that they would not be moved by Gen. Kenan Evren's statement denying permission for the U2 flights.
House Majority Leader Jim Wright (D-Tex.) said. "I really don't think Congress . . . should be in a position of responding to threats." Wright said the threat was "not new," because Turkey had said some months ago it would allow the U2 flights only if the Soviet Union agreed to them.
Majority Whip John Brademas (D-Ind.), one of those in the forefront of the fight to deny Turkey the military grant, said the issue was Turkey's lack of willingness to settle its Cyrpus dispute. Brademas said after the vote last week that Turkey has done nothing to settle the dispute despite a promise to seriously negotiate the Cyprus question last year year when Congress was persuaded to lift an arms embargo against Turkey. After a 1974 invasion Turkey took control of the northern 40 percent of Cyprus, forcing nearly 200,000 Greek Cypriots to flee to the south as refugees.
Brademas said Turkish promises of a movement towards settlement have proved to be false, and he is reluctant to grant more aid under those conditions.
Administration offcials have argued the $50 million grant is justified because Turkey, a key member of the North Atlantic Treaty Organization, is suffering severe economic problems.
The House compromise called for the $50 million in military aid to be in the form of a loan, but would have provided a $50 million grant for economic assistance.
State Department congressional liaison Brian Atwood said the administration rejected the House proposal for $50 million in economic aid because "we're keen on our original proposal. The problem is in getting assistance to Turkey's military, which is in bad shape. You might think they could take $50 million from one pocket and put it in another, but they can't. It's just their political situation."
A Senate source said, "Frankly, I think it's become a symbolic issue with the Turks." He said they were promised a $50 million military grant and feel anything else does not fulfill the promise.
Atwood said, "This is going to take some negotiation," and predicted the House and Senate conferees on the foreign aid bill probably wouldn't meet again until after the July 4 recess, which begins Friday.