‘Praying Ceaselessly’ for Hijack Victims : Even on Road for Tax Bill, Reagan Is Deeper in Crisis

President Reagan traveled to the Midwest on Wednesday to drum up support for his tax plan and to dispel any impression that the Beirut hostage drama has taken over his agenda, but he found himself drawn to the crisis at every stop.

In the small town of Mooresville, Ind., he told reporters that he is “praying ceaselessly” for the safety of the 40 Americans held captive by Shia Muslim gunmen. And in Indianapolis, he met briefly with the parents and other relatives of hostage James Hoskins Jr., 22.

During the eight-minute meeting, arranged at the request of Hoskins’ family, Reagan sought to reassure them that he is doing everything possible to solve the crisis, White House spokesman Alfred R. Brashear said.

Aides said the President had intended to concentrate on selling his tax reform proposal during the one-day trip. On the trip and in Washington, however, both the President and his Administration found themselves drawn deeper and deeper into the crisis.

Even before Reagan could begin informal remarks to the Chamber of Commerce in Mooresville, he paused as his host asked the group to join in a silent prayer for the hostages.

Later in the day, Reagan departed from the text of a speech on the tax plan to tell 5,000 delegates at the annual convention of the U.S. Jaycees: “We must not yield to the terrorists’ demands. We must not yield to the terrorist demands that invite more terrorism. We cannot reward their grisly deeds. We will not cave in.”

The crowd responded with a standing ovation and chants of “U-S-A.”

Despite a major White House effort to project an image of business as usual, the demands of managing the hostage crisis already have taken over much of the Administration’s foreign policy machinery and are drawing the President into an increasingly direct role as well.

From the first day of the hijacking of TWA Flight 847 last Friday, Reagan aides made every effort to portray him as not enmeshed in the crisis and able to adhere to his schedule of White House meetings and travel on other issues. They said the President intends to go ahead with a planned trip to Dallas on Friday and to spend the July 4 holiday in California.

More Active Role

But as the stalemate in Beirut continued, the Administration stepped up its diplomatic activity on the crisis, and Reagan gradually assumed a more active role. The President telephoned Syrian President Hafez Assad on Monday to ask his help, officials said, and spoke with King Hussein of Jordan and other foreign leaders Tuesday.

In his news conference Tuesday evening, where the questioning was dominated by the Beirut crisis, Reagan acknowledged his emotional involvement in the issue. “I’m as frustrated as anyone,” he said. “I’ve pounded a few walls myself, when I’m alone, about this.”

Reagan is scheduled to meet today with the president of the Geneva-based International Red Cross, which is playing a delicate role in the U.S. strategy for ending the crisis. Administration officials say they hope the Red Cross can certify that Israel plans to release the 766 prisoners whose freedom the Shia terrorists are demanding and that such a declaration will prompt the Shias to release the hostages without any formal bargain being struck.

Neither the United States nor Israel is willing to make formal concessions to the hijackers, saying that such actions would encourage future terrorist acts.

Walking a Careful Line

Officials also say they are trying to walk a careful line in their responses to the crisis, making it clear to the American public that they are working hard for a solution without allowing the issue to swamp all other priorities.

In that, they are applying one of the lessons from President Jimmy Carter’s confrontation with Iran in a similar hostage seizure in 1979-1981. Carter, who declared the crisis his overriding priority and canceled several scheduled trips, later concluded that his consuming attention to the issue may have encouraged the Iranian militants to resist U.S. pressure--and clearly made him a focus of resentment over the long standoff.

Instead, Reagan’s national security adviser, Robert C. McFarlane, has been the central figure managing the problem, both suggesting options to the President and staying in telephone contact with Nabih Berri, the Shia Muslim militia leader who claims to control the hostages and their captors.

Reagan and his aides also have been insistent in saying that by declaring his responsibility for the hostages, Berri will be accountable for any failure to turn them over--whether he genuinely controls the terrorists or not.

‘Trying to Create Space’

“They’re trying to create some space between themselves and the crisis,” said Gary Sick, who advised Carter on Iran. “In a way, they’re saying it’s not our problem anymore, it’s Berri’s problem. But it isn’t easy. . . . So far, Reagan’s handling of the crisis is no different from what Carter would have done.”

In the speech that was planned as the centerpiece of the trip, Reagan said he wants to lower the top income tax rate not “so the rich will do better,” but to give working Americans “a better chance to get rich.”

Answering critics of his tax plan, which would reduce the highest income tax rate from 50% of earned adjusted income to 35%, the President said the effort to face “the great challenges of our future with today’s outdated tax system” is akin to “trying to win the Indianapolis 500 on a bicycle.”

Simplifying Tax Structure

In addition to lowering the top tax rates, the plan would simplify the overall federal income tax structure, removing deductions allowed for state and local taxes, increasing the allowances for individual exemptions and trimming to three levels the current system of up to 15 tax brackets.

To critics who have advocated a higher uppermost level “so the rich pay more,” Reagan said, “That argument misses the central point of what we’re doing.

“We are not lowering the top tax rate to 35% so the rich will do better. We are lowering the top rate to 35% so that every working American will have a better chance to get rich,” he told the Jaycees, whose organization emphasizes community service projects.

James Gerstenzang reported from Indianapolis and Doyle McManus from Washington.