I finally got it out! A pair of pliers to the remnants of the plastic pull tab. After about six failed attempts, the whole tray came crashing down (boy am I glad my hand was not underneath) and the remnant of the pathetic plastic pull tab flew into the air as it split into 3 more pieces.
The spare tire (215/70-14) which was brand new with 0 miles when stowed has four deep gouges in the sideall that faced upwards. It was completely devoid of pressure. I filled it to 40psi to see if it leaks but I doubt I'd ever dare use it again (well I never have used it). It was a great tire too (Sears Response XL). Obviously a 215/70-14 cannot fit into the spare-tire bay without severe damage to the tire. Whether a 205/70-14 would fit, I don't know. I suspect it was designed for 185R14 so those of us with allow wheels are out of luck. Its amazing what mechanisms become visible one you look up through the empty spare wheel bay.
TWO QUESTIONS:
(1) Can the pull-tab mechanism be repaired?
(2) What size tire will fit in spare tire tray without damage?

-David (1987 Wolfsburg)