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The U.N. Security Council resumed its debate Friday on the shooting down of Iran Air Flight 655, with Iran rejecting U.S. suggestions it shared blame. It demanded Washington take full responsibility before it accepts compensation for the victims' families.

Thursday, Vice President George Bush - a U.N. ambassador under the Nixon administration - returned to the world body on orders of President Reagan to defend the U.S. position on the shooting down of the Iranian plane with the loss of all 290 people aboard.In a high-profile appearance aimed in part at bolstering Bush's diplomatic credentials, the vice president countered charges by Iran's foreign minister, Ali Akbar Velayati, that U.S. policies are the "root cause" of the conflict in the Persian Gulf.

Bush accused Iran of rejecting the world body's calls for a cease-fire in the nearly 9-year-old Iran-Iraq war while at the same time complaining about the consequences of the conflict.

He said it was that defiance of international pressure to end the war and Iran's stepped-up fighting that led to the July 3 shooting down of Iran Air Flight 655 by missiles fired from the USS Vincennes. Officers on the U.S. warship, which was patrolling the gulf to defend oil tankers from attack and had just clashed with Iranian gunboats, believed that the airliner was an Iranian F-14 jet.

"We respect Iran's right to air its grievances," Bush told the Security Council. "But Iran cannot have it both ways. Iran cannot simultaneously complain to this body and defy it."

Bush said U.N. Resolution 598 remains the basic document to work out the permanent cease-fire and urged its implementation. Iran has refused to abide by it, demanding that the United Nations brand Iraq the aggressor in the war before peace talks can begin.

Iraq said it will accept the resolution if Iran does the same. The ambiguous position of the two nations has stalemated U.N. diplomatic efforts in the past year.

More than 15 nations have demanded the right to speak in the debate, and U.N. diplomats said Friday Iran will not get the condemnation it wants.

Security Council president, Brazilian Ambassador Paulo Nogueiro-Batista, was consulting with the council's 15 members on ways to compromise a possible U.S. veto and the Iranian demand.

The diplomats said it would take several days to work out the compromise, possibly in the form of a statement by the council.

Velayati, in contrast to Bush's 20-minute speech, spoke for almost two hours. His detailed accounts of the incident and strong accusations against Washington at times made many council members uneasy and impatient.

"The foreign minister knows better," Bush said when it was his turn to speak. "He knows that the tragedy was an accident. He knows that by allowing a civilian airliner to fly into the area of an engagement between Iranian warships and U.S. forces in the gulf, Iran must bear a substantial measure of responsibility for what has happened."

Velayati rejected that suggestion and instead accused the U.S. administration of lacking "common sense."

"What is important is for the United States to show responsibility," Velayati said. "We will accept the compensation if it is in the context of the United States accepting that responsibility."

But he said "We don't need charity" if the U.S. payments are just a humanitarian measure. The Reagan administration has decided to pay the victims' families directly instead of directing the money through the Tehran government. The amount of compensation has not been determined.

Velayati also derided Bush's suggestion that Tehran should reroute civilian air traffic over the Persian Gulf waters where the U.S. Navy has been providing protecting for oil tankers and merchant ships against missile attacks either from Iran or Iraq.

Velayati said air traffic corridors around the world are fixed by the Montreal-based International Civil Aviation Organizational.

"Tomorrow they will ask us to relocate our oil installations because the U.S. fleet is nearby," he said. "Wherever the U.S. is stationed, lives are disturbed because of that."

The United States, as one of the five permanent members of the Security Council, can veto any resolution condemning its actions.