--- a/src/ChangeLog
+++ b/src/ChangeLog
@@ -1,3 +1,15 @@
+2008-03-25  John W. Eaton  <jwe@octave.org>
+
+	* lex.h (lexical_feedback::looking_at_initializer_expression):
+	New data member.
+	* lex.l (lexical_feedback::init): Initialize it.
+	(handle_identifier): Don't unconditionally force identifiers to be
+	variables in the current scope.  Don't call force_local_variable
+	for symbols that appear in parameter initializer expressions.
+	* parse.y (decl_param_init): New parser "subroutine".
+	(decl2): Use it.  Set lexer_flags.looking_at_initializer_expression
+	to false after parsing initializer.
+
 2008-03-24  David Bateman  <dbateman@free.fr>
 
 	* data.cc (map_s_s): Fix for sparse/sparse mappers that resulted

--- a/src/lex.h
+++ b/src/lex.h
@@ -92,6 +92,10 @@
   // TRUE means we're parsing the parameter list for a function.
   bool looking_at_parameter_list;
 
+  // TRUE means we are looking at the initializer expression for a
+  // parameter list element.
+  bool looking_at_initializer_expression;
+
   // TRUE means we're parsing a matrix or the left hand side of
   // multi-value assignment statement.
   bool looking_at_matrix_or_assign_lhs;

--- a/src/lex.l
+++ b/src/lex.l
@@ -2286,7 +2286,8 @@
     {
       if (next_tok_is_eq
 	  || lexer_flags.looking_at_return_list
-	  || lexer_flags.looking_at_parameter_list
+	  || (lexer_flags.looking_at_parameter_list
+	      && ! lexer_flags.looking_at_initializer_expression)
 	  || lexer_flags.looking_at_matrix_or_assign_lhs)
 	{
 	  force_local_variable (tok);
@@ -2312,11 +2313,6 @@
   yylval.tok_val = new token (&(symbol_table::insert (tok)),
 			      input_line_number, current_input_column);
 
-  // FIXME -- this forces a link for tok in the chain of variables for
-  // the current scope.  Probably this step should be done
-  // differently, maybe in symbol_table::insert?
-  symbol_table::varref (tok);
-
   token_stack.push (yylval.tok_val);
 
   // After seeing an identifer, it is ok to convert spaces to a comma
@@ -2364,6 +2360,9 @@
   looking_at_return_list = false;
   looking_at_parameter_list = false;
 
+  // Not looking at an argument list initializer expression.
+  looking_at_initializer_expression = false;
+
   // Not parsing a matrix or the left hand side of multi-value
   // assignment statement.
   looking_at_matrix_or_assign_lhs = false;

--- a/src/parse.y
+++ b/src/parse.y
@@ -929,10 +929,16 @@
 		  }
 		;
 
+decl_param_init : // empty
+		{ lexer_flags.looking_at_initializer_expression = true; }
+
 decl2		: identifier
 		  { $$ = new tree_decl_elt ($1); }
-		| identifier '=' expression
-		  { $$ = new tree_decl_elt ($1, $3); }
+		| identifier '=' decl_param_init expression
+		  {
+		    lexer_flags.looking_at_initializer_expression = false;
+		    $$ = new tree_decl_elt ($1, $4);
+		  }
 		;
 
 // ====================