The NewsHour with Jim Lehrer

RAY SUAREZ: Good evening, I'm Ray Suarez. Jim Lehrer is off this week. On the NewsHour tonight, Gwen Ifill and Jan Crawford Greenburg discuss the Supreme Court ruling supporting state's rights, and two constitutional lawyers will debate what the decision means. We'll take a look at the plans for dealing with Social Security from the bush and gore campaigns, and media reporter Terence Smith peruses the nation's magazine racks, groaning under the weight of new publications. It all follows our summary of the news this Monday.

NEWS SUMMARY

JIM LEHRER: The U.S. Supreme Court today issued another major decision upholding states' rights. The Justices threw out part of a 1994 law that allowed rape victims to sue their attackers in federal court. The 5-4 decision said those suits belong in state courts. Lawyers for a Virginia woman had argued states aren't doing enough to protect rape victims. We'll have more on this story right after the News Summary. Texas Governor Bush laid out his plan today to overhaul Social Security. The Republican presidential candidate said he would let workers invest part of their payroll taxes in private accounts. He said he trusts Americans to manage their own money, but he also sought to reassure retirees.

GOV. GEORGE W. BUSH: For those on Social Security or close to receiving it, nothing will change. Government has made a commitment, and you have made your plans. These promises will be honored, yet it's important to note that without reform, our younger workers face a great risk, a lifetime of paying taxes for benefits they may never receive.

RAY SUAREZ: In response, Vice President Gore said Bush's plan amounted to "stock market roulette." We'll have more on this story later in the program tonight. Israeli troops fought with Palestinian police and protesters today in the West Bank and Gaza. At least four Palestinians were killed and more than 320 were hurt. 14 Israeli soldiers were injured. We have this report from Vera Frankl of Associated Press Television News.

VERA FRANKL: The worst violence erupted on the outskirts of the West Bank town of Ramallah. It began when about 400 Palestinian protesters threw petrol bombs and stones at Israeli troops, who responded with rubber bullets and tear gas. After several hours, Israeli troops and Palestinian police mingling with the protesters began using live rounds, but it was not clear what prompted the escalation. Later, Palestinian policemen shooting from rooftops exchanged fire with Israeli soldiers in the streets below. The violence came despite a decision on Monday by the Israeli cabinet to transfer three West Bank villages near Jerusalem to Palestinian control. Israel was braced for trouble, as thousands of Palestinians across the West Bank and Gaza Strip marked Al Naqba, the Arabic word for catastrophe they use to describe Israel's founding in 1948. Protesters also demanded the release of hundreds of Palestinian prisoners from Israeli jails. The atmosphere has been tense in the Palestinian territories in recent days, with Palestinians increasingly frustrated over lack of progress in the peace talks, and Israel's refusal to release more prisoners.

RAY SUAREZ: The two sides blamed each other for the violence. In Washington, a State Department spokesman said U.S. Special envoy Dennis Ross was headed to Israel for new talks. U.N. officials said today that rebels in Sierra Leone have released at least 139 U.N. peacekeepers. Those freed are being taken to neighboring Liberia. Some 350 peacekeepers remain captive. Rebels abducted them earlier this month and shattered a ten- month-old peace accord. Thesituation calmed somewhat after a British evacuation force helped secure the capital city. Freetown. The fire danger to Los Alamos, New Mexico eased today. Crews contained parts of a wildfire burning closest to the town and its national weapons laboratory. Elsewhere, the flames burned unchecked, and forecasters warned of high winds tomorrow. Officials said controlling all of the fire could take some time.

JIM PAXON, Spokesman, U.S. Forest Service: This is going to be cyclical. We look at probably three or four days of pretty good firefighting weather after this front gets through. That will start Wednesday. Then we'll have another one come flew, another dry cold front. We won't develop rains until we get the clouds and the monsoonal moisture moving in unless it's just a little freak storm that comes along, so this is long term.

RAY SUAREZ: The National Park Service set the fire may 4 to burn brush, but it got out of control. It has now burned more than 44,000 acres and destroyed more than 200 homes. That's it for the News Summary tonight. Now it's on to today's high court decision involving a Virginia rape case and state's rights; Social Security and the presidential race; and the crowded world of new magazines.

FOCUS - SUPREME COURT WATCH

RAY SUAREZ: Gwen Ifill has the Supreme Court story.

GWEN IFILL: The states versus Congress: Who gets the last word? The Supreme Court sided today with the states. It threw out a key provision of the 1994 Violence Against Women Act, which allowed rape victims to sue their attackers in federal court. In a 5-4 decision, the court held that Congress overreached. We get more on today's court action from NewsHour regular Jan Crawford Greenburg, national legal affairs correspondent with the "Chicago Tribune."

Jan, when you were here in January, we talked about the arguments in this case. You said even then that the justices seemed skeptical about this appeal and that's proved to be true.

JAN CRAWFORD GREENBURG: That's right. In fact, several of the lawyers that I spoke with today said that they weren't really surprised by the ruling because the Justices at argument seemed so skeptical of the law. Now, sometimes you cannot obviously predict how they're going to go after the argument, but in that argument, even the ones that the supporters, the supporters of the law, had hoped would be on their side made clear that they were dubious of Congress's authority in this area. Justice O'Connor, for example, said if Congress can pass a law here, then they could seemingly get involved in a host of other areas that traditionally the states have handled, like child support and alimony, and some of that language was in the opinion today that was written by chief Justice William Rehnquist.

GWEN IFILL: Tell us some more about that opinion and exactly what points did he make?

JAN CRAWFORD GREENBURG: Well, today's ruling I think has to be seen in context of a 1995 ruling. So let me just mention that one first. That one is called United States Versus Lopez. In that case, the court for the first time in some 60 years said that Congress went too far when it passed this law that would have made it illegal, a federal crime, for someone to carry a gun 1,000 feet I think within a school. At the time when that ruling came down, legal scholars said it was just and passed a law that exceeded its authority, in this case, to regulate interstate commerce. But today the court's ruling made clear that it meant what it said in that 1995 case and that no longer is Congress going to just get a pass when it points to a law and says we can pass this law because the Constitution gives us the authority to do so under our ability to regulate interstate commerce.

GWEN IFILL: No matter how politically popular the subject matter may be.

JAN CRAWFORD GREENBURG: That's right. This was certainly a popular law. Many states said that they supported it, but the Chief Justice in his majority opinion closely divided like all of these states' rights ruling are by a vote of 5-4 stressed that every law Congress passed has to stem from some power that has been given in the Constitution. And for them... for Congress to say that the law comes from its ability to regulate interstate commerce, it must be able to show that the activity at issue substantially affects interstate commerce. There are many things that the court is going to look at in evaluating whether it substantially affects interstate commerce such as how close the impact is on interstate commerce, whether or not the activity is economic in nature, obviously violence, the court has said, may not be. So that's significant because for decades people have assumed that pretty much anything goes, and Congress can regulate a lot of things under its ability to regulate interstate commerce.

GWEN IFILL: You mentioned that this was another very narrow 5-4 decisions. Justice Souter was the one who wrote the dissent. What was his point in supporting that appeal?

JAN CRAWFORD GREENBURG: He said that this case was different than the 1995 case. In fact, after that case some of the lower court ruling said that that wasn't this grand change in the court's thinking. In fact, it was just like a judicial slap on the wrist and Congress just needed to make clear why it was regulating interstate commerce. Souter said Congress did that when it passed the Violence Against Women Act. It had mountains of evidence that domestic violence and gender-motivated violence affected interstate commerce, three to five billion lost every year in productivity. He listed a long list of the impact that violence would have on the national economy. And then he suggested that actually Lopez was wrong. The court didn't obviously get into that and these five Justices seemed to strongly believe that Congress has a very distinct role to play, the states have a very distinct role to play. That's important in the founders' vision of our system, that to preserve, as the court said today, to preserve our fundamental liberties, we need this and the founders saw this, to have these divided authorities where congress had a role and where the states had a role.

GWEN IFILL: The court also rejected the notion that Congress needed to step in because this was a gender-motivated crime that we were talking about and that Congress had to speak to this sort of issue. It rejected that as well.

JAN CRAWFORD GREENBURG: Right. We've been talking about one of the ways that Congress can get its power to pass laws under the commerce clause as I mentioned. There's another way that Congress can pass laws is under its authority to enforce the 14th Amendment which prohibits states from depriving people of life, liberty or property without due process or equal protection of the laws. Today the court said Congress can't fit this law into that area either because that authority only goes to state activity. Here this was between two private individuals. So Congress couldn't pass a law regulating private conduct.

GWEN IFILL: People have been watching Sandra Day O'Connor on this one. They thought perhaps that on a case that involved gender-specific crimes she might be more likely toflip to the other side.

JAN CRAWFORD GREENBURG: Right. Because she has been with the five Justices in the majority on these states' rights rulings and they had pinned their hopes on her. But I think after the argument, the lawyer for Christy Bronkala, her trial lawyer told me today that her heart just sunk because O'Connor's questions at the argument were very skeptical and certainly she's very sensitive to gender issues but there is a remedy for women who have been subjected to gender-motivated violence and they can turn to the state court. So I think some people have suggested that that weighed on O'Connor's thinking that women weren't being shut out of the courthouse; they just couldn't go into federal court for damages in this situation.

GWEN IFILL: Briefly, was either side surprised by the outcome today?

JAN CRAWFORD GREENBURG: I don't think so, not after the arguments.

GWEN IFILL: Jan Crawford Greenburg, thank you very much.

GWEN IFILL: Now, with more on the impact of today's states' rights ruling, we're joined by two Constitutional law professors: Michael McConnell of the University of Utah, and Catherine MacKinnon of the University of Michigan and the university of Chicago.

Catherine MacKinnon, does the court have a correct interruption when they say in your view that Congress can't really act on this?

CATHERINE MacKINNON, University of Michigan School of Law: Well, I disagree with their interpretation, and as the dissent showed, there's substantial support for Congress having power to pass this law. They can pass it when there's a substantial impact on interstate commerce. There was overwhelming evidence of that here -- and also to give people equal protection of the law when the states aren't doing it. And the evidence there was absolutely overwhelming. Indeed the states themselves agreed with it. So, you know, this was close. There's a very, very strong case on the other side.

GWEN IFILL: Michael McConnell, your view?

MICHAEL McCONNELL, University of Utah School of Law: Well, I think this was an expected decision. I think it was largely a pretty straightforward and commonsensical interpretation of the Constitution. This is, of course, a very popular law, and no one opposes effective legal protection against violence against women, but what was at stake here is more fundamental structural principle of our government: Not all power is vested in Washington, that in our system, a great deal of authority and including some of the most important laws that we live under are left to the states to pass and to administer. And this was, as I say, I think a pretty straightforward interpretation of those limits. Congress has the power to regulate interstate commerce. That's a very important power and a very large power. But this statute was directed at something that is neither interstate nor commerce. And I really don't see how the court had much of a... of an option. It simply went beyond Congress's authority.

GWEN IFILL: So, Professor McConnell, what you're saying it's not up to Congress to step in when the states or if the states are not doing their job?

MICHAEL McCONNELL: The Constitution doesn't give Congress the power simply to step in whenever it thinks states are not solving a problem. It gives Congress the power to step in to regulate interstate commerce, and that's the question before the court.

GWEN IFILL: Professor MacKinnon, part of the central argument here was that gender violence was having a direct affect on the national economy. Do you agree with that? I think you agree with that and could you explain to me what that would mean, how you would prove such a thing.

CATHERINE MacKINNON: Well it was proven in Congress when the legislation was passed. There's a massive amount of evidence that when you're being beaten and violated and, in fact, tortured and nothing is being done about it by the states in which you live, not through the police, not through the courts, that has a bad effect on your ability to travel to make a living, to go to work to make a living, to stay at work to make a living, to stay off welfare. It has a huge economic affect. It's substantial. It was direct, and it was proven. So, you know, there really is absolutely no question about that impact.

GWEN IFILL: Excuse me. You heard Jan Crawford Greenburg say a moment ago that during the arguments one of the arguments was if they took this case and agreed with the proponents that they would open the door to all kinds of other actions, second-guessing the states in all kinds of other cases like child support and alimony.

CATHERINE MacKINNON: Well, those, first of all, don't... you would have to first make a case that was as strong as this one. And it was a very, very strong case. Secondly, they don't raise in precisely the same way the same issues under the 14th Amendment. It may be that that case could be made. If it could, possibly something should be done about it. But it hasn't been. You know, what needs to be kept in mind here is that sex-based violence does deprive women of equality in society. It's deprived them of equal protection under state law. And what this federal remedy was for was to give women in every state in the nation access to both federal and state courts. They could have brought it in either one -- to stop that violence against them. As I said, the states were for it. The idea that states' rights are somehow being violated here isn't correct. Not only did the states themselves not think they were, but this would have continued to allow states to do everything and anything they want to do and can do to address violence against women and only would have given women themselves an additional civil remedy that they could pursue on their own.

GWEN IFILL: Professor McConnell, that's an interesting point. Actually 36 states did sign on in support of this law. Is this a broader issue beyond just the question of gender violence, this whole question of states' rights in this case?

MICHAEL McCONNELL: It certainly is. We don't judge the constitutionality of statutes by whether state attorneys general, who are after all just a different species of politicians, sign briefs supporting the law. The question in this case was whether this was a law regulating interstate commerce. I think the court correctly held that it wasn't. Now, of course violence against women effects... has various economic effects. There's no question about that. All violence and all crime have very substantial economic effects. But if that's the argument here, then that means that the entire criminal law could be made a matter of federal concern. And that is simply not the Constitution that we have and not the system that we have. There was no showing here that violence against women had any more of an effect on the economy than any other slice of the problem of violence crime. In fact, men suffer from violent crime at much higher rates than women do. 75% of all homicide victims are male. Two-thirds of robbery and assault victims are male. Men are 2.5 times more likely to be victim of violent assault. And if you look at the aspects of crime that probably have the greatest effect on the economy, it's even more extreme. Men suffer over 83% of all workplace homicide. They're more likely to be victimized traveling than women....

GWEN IFILL: I'm trying not to reargue the case but in a broader sense I wonder what Congress now has to do in this. Congress has been told in 1995 in the Gun-Free School Zone Act which was set aside by the court as well as now that Congress's role should be scaled back. What does Congress do now? Let me start with Professor MacKinnon.

CATHERINE MacKINNON: Well, Congress could take some shorter steps here, but it strikes me that if any further evidence were needed of the need for a federal equal rights amendment to the Constitution, this ought to provide it. In addition, states that want to do something further about violence against women are in a position like Illinois recently has done to introduce and pass their own Violence Against Women Act. Congress can, of course, work with additional hate crimes laws that it has and work with a New Violence Against Women Act in an attempt to give women the rights that they need and some men too.

GWEN IFILL: Is the burden now to change this, professor McConnell, on the states rather than on the federal government, to fill in any gaps that might exist?

MICHAEL McCONNELL: As it always has been and still is, the principal job of fighting violent crime in this country is in the states. I am all in favor of it and I think most Americans are in favor as effective enforcement of laws against violent crime as we can possibly have. There's simply no reason to believe that this particular slice of the violent crime problem belongs to the federal government instead of the states.

CATHERINE MacKINNON: We look forward to the support of all those people in every state in the union passing their own violent-- Violence Against Women Act.

MICHAEL McCONNELL: I don't think you'll find that there's any political opposition to effective anti-crime measures in this country. This is really not a very controversial statute on the merits. Everybody is in favor of making this sort of thing, this sort of activity criminal and of enforcing it effectively.

GWEN IFILL: Would you agree that overall this court is moving more and more towards taking power away from Congress and giving it to the states, Mr. McConnell?

MICHAEL McCONNELL: Actually, I think that the court is enforcing only in the most modest restriction. Essentially what the court is saying is that in that exceedingly unusual case where Congress is regulating something that is non-economic and not interstate that it is overstepping its bounds. That doesn't happen very often. In fact, I can think of very few statutes that were likely to be challenged as a result of this decision.

GWEN IFILL: Catherine MacKinnon, a final word on what the eventual... where Congress... where the court ends up with this in trying to scale back Congress's rules over state rights... I didn't say that well. I think you know where I'm going.

CATHERINE MacKINNON: States' rights has long been recognized as a fig leaf for racism in this country. What I think we've seen today is its employment as a fig leaf for sexism. It's up to all branches of the government to attempt to get women equal protection of the law which so far we do not yet have.

GWEN IFILL: Catherine MacKinnon, Michael McConnell, thank you both very much.

RAY SUAREZ: Still to come on the NewsHour tonight, Social Security and the presidential race, and the crowded world of new magazines.

FOCUS - SOCIAL SECURITY

RAY SUAREZ: Susan Dentzer of our health unit begins the Social Security report. The unit is a partnership with the Henry J. Kaiser Family Foundation. (Applause)

SUSAN DENTZER: George W. Bush today unveiled a broad outline of key principles to reform Social Security. Among them was a provision to allow younger workers to invest a portion of their Social Security taxes in personal retirement accounts. The controversial approach is often referred to as "partial privatization."

GOV. GEORGE W. BUSH: Millions of Americans will have an asset to call their own. This is the best thing about personal accounts. They are not just a program, they are your property, and no politician can take them away.

SUSAN DENTZER: Democratic candidate Al Gore has charged for weeks that Bush's proposal put retirees' benefits at risk, and imperiled Social Security.

AL GORE: I think that's bad for American families and bad for our economy.

SUSAN DENTZER: Vice President Gore and Governor Bush have now raised sharply different approaches, for addressing Social Security, but they do agree on the central problem.

GOV. GEORGE W. BUSH: Eight years from now, the massive baby boomer generation will begin drawing benefits. Their lives will be long and healthy, and within two decades, there simply will not be enough younger workers to pay the benefits earned by the old.

SUSAN DENTZER: Under current projections, around 2015, Social Security is likely to start paying out more in benefits than it takes in in payroll taxes. By around 2037, its trust funds are likely to be exhausted. Incoming payroll taxes would then cover only about 70% of promised benefits. Experts have long called on Social Security to put aside more money ahead of time to pay benefits due future retirees. Bush's plan aims at doing that by allowing workers voluntarily to shift a portion of their payroll taxes into private accounts.

GOV. GEORGE W. BUSH: A younger worker can take some portion of his or her payroll tax and put it into a fund that invests in stocks and bonds. Now, our government will establish basic standards of safety and soundness, so that investments are only in steady, reliable funds. In other words, there will be no fly-by-night speculators or day trading. And money in this account can only be used for retirement, or passed along as inheritance. Even if a worker chose only the safest investment in the world, an inflation-adjusted U.S. Government bond, he or she would receive twice the rate of return of Social Security.

SUSAN DENTZER: Even with today's speech, Bush was vague on many details. For example, he hasn't said what portion of workers' payroll taxes would be invested in private accounts. But Social Security is largely a pay-as-you-go program, where most of the money coming in goes right out the door to retirees. So to allow workers to switch money into private accounts, Bush envisions tapping Social Security's surpluses until about 2030. After that, experts say benefits would need to be cut or other money found to keep the system going, or some combination of both. Today, the only thing Bush ruled out was a hike in the payroll tax.

GOV. GEORGE W. BUSH: The payroll tax must not raised. (Applause) We cannot tax our way to reform. (Applause)

SUSAN DENTZER: Vice President Gore's radically different approach would harness the surpluses currently building up in Social Security to help stave off insolvency. In effect, he would use the surpluses to pay down the $3.5 trillion in national debt held by the public. In turn, the interest savings from reducing the debt would be invested in the Social Security trust funds.

AL GORE: If we pay the publicly held debt down to zero, the savings are going to be enormous. I believe those interest rate savings that come from the debt pay-down attributable to the Social Security surplus ought to be put back into the Social Security fund. That will extend the life of the trust fund to the year 2054.

SUSAN DENTZER: Gore said today that his is a far sounder approach than Bush's, which would expose retirees to the vagaries of investment markets.

AL GORE: If you chose to invest part of your Social Security into the stock market and the investments somehow didn't work out, and you had sharply reduced benefits, then what would happen? Well, one possibility is that the Congress in the future would be called upon to bail out the poor choices that investors made to prevent them from falling into social insecurity.

SUSAN DENTZER: But critics note that Gore's plan could still fall well short of guaranteeing Social Security's solvency over the long haul.

RAY SUAREZ: And for more, we're joined by Alicia Munnell, Professor of Finance and Director of the Retirement Research Center at Boston College. She is an economic advisor to the Gore campaign. Kenneth Blackwell is Secretary of State for Ohio, and a supporter of the Bush campaign. Edith Rasell is an economist with the Economic Policy Institute, a Washington research and policy group. And Michael Tanner, director of the Project on Social Security Privatization at the Cato Institute. Kenneth Blackwell, let's start with you. This Bush plan has been termed a partial privatization. How would that work?

KENNETH BLACKWELL, Secretary of State, Ohio: Well, essentially what governor Bush is saying is that people at the lower end of the economic ladder have a right to have a stake in the ownership of America and their retirement security. This really speaks to the needs of people who are right now on the wrong side of the asset gap and the wealth gap in this country. This is a bold plan, which really understands that the demographics of the "pay as you go" tax transfer system no longer works. But more importantly it no longer provides an opportunity for lower-income workers to have a real stake in the asset base of this country. One of the things that I find a bit hypocritical is that I would imagine that the Vice President doesn't have all of his money, all of his assets, tied to treasury bonds or notes. The reality is that he benefits from the power of compounding interest. What we want to do is to give working people that same benefit. And I think Governor Bush has established a framework for us to think differently about this and to think in a bipartisan fashion. He is not saying this alone. You have Senator Kerry and Senator Moynihan both saying that this is a logical completion to the Social Security system that was begun in 1935 and that it is this sort of gradual approach, responsible approach, that will lend itself to building a bipartisan base to get this done. This is a ticking demographic time box that Al Gore is willing to let explode on our children's future.

RAY SUAREZ: So if this were to become a reality, we would have 105, 110 million American workers each with a privately managed retirement account from this portion of their Social Security?

KENNETH BLACKWELL: From the small portion of the Social Security taxes. The reality is that Governor Bush's plan would protect the core of the present program. It would... but it would allow some personal ownership and personal involvement in shaping the Social Security destiny of each individual worker. I mean, that is the American way.

RAY SUAREZ: Michael Tanner, were you pleased by what you saw?

MICHAEL TANNER, Cato Institute: I think this is a dramatic step in the right direction. Governor Bush is the first major party presidential candidate since Barry Goldwater to be willing to talk about true Social Security reform. Social Security faces two distinct problems, not just one. The one we hear about is the solvency problem. The fact, as your report indicated, that within just about 15 years it will begin to run a deficit and the fact that overall it's about $21 trillion, that's with a "t" dollars in debt but there's an additional problem. And that is the fact that for most young workers are receive a remarkably poor return on their money. Many young workers will receive 1% return on their money or less. Others are going to receive a negative return, actually lose money on the current Social Security program. We need to find a Social Security reform that fixes both of those problems at once -- not only keep the program solvent into the future but also increases the rate of return for young workers and also guarantees them a legal property right in their benefits, a legal right of ownership and an ability to pass on benefits to future generations.

RAY SUAREZ: And the Bush plan does this in your view.

MICHAEL TANNER: The Bush plan goes a long way towards doing this. I'd like to see more but it's a good start.

RAY SUAREZ: Edith Rasell, does this satisfy some of the built-in requirements that you would have a national retirement system?

EDITH RASELL, Economic Policy Institute: Not at all. It's a step in the wrong direction. It introduces risk into a program that now is a guarantee... provides guaranteed income to people in retirement. This program instead is more of an investment program. We know the stock market can go up. It can also go down. And this program also means that we're going to have winners and losers. Right now nobody gets rich off Social Security. But everybody gets by for the most part. And when we have an investment program like he is describing and people put away 2% or whatever percent of their income is the final proposal, if you've got a high income and put away 2% in a private account and make good investments because you're more experienced at doing that, then you might end up doing very well. Somebody else who has a more moderate income and puts away 2% is going to have not much to start with and if they are unlucky in their investments or happen to retire at a time when the market is down, then they're going to do poorly. And instead of having everybody getting by with their core retirement benefit, as they do now with Social Security, we're going to have some people who do very well and other people who do very poorly. And then the question is what are we going to do about these folks, this growing number of elderly people that are now living in poverty, who are really not security in their retirement. Bush's plan just doesn't really address that.

RAY SUAREZ: Alicia Munnell, don't we have winners and losers today with the current set-up of those who are more economically able to provide fairly well for their retirement? Mr. Blackwell pointed out that Vice President Gore is unlikely to have all his future plans based on treasury notes.

ALICIA MUNNELL, Boston College: I would like to make two comments. The first is that Social Security is a well functioning program. The trustees are very prudent. They make financials projections over 75 years. Over the 75-year period, this program is running a small deficit. That deficit can be fixed within the context of the current program. There is just absolutely no need for a dramatic restructuring of this program. The second point I want to make is the benefits provided under this program are very modest. For the average person it's roughly $800 month. Is $800 a month an amount that we want to put at risk? It just does not make any sense at all.

KENNETH BLACKWELL: Well, you know, that's off the point. What Governor Bush is saying is that we should put 2%, we should preserve the core of the program. Now essentially this is the duplicity of the Gore campaign once again. Let me just give you a for instance. He wants to hold a lot of children hostage in schools that don't work but he sends his kids to private schools. Now he wants to benefit from the power of compounding interest and ownership but he doesn't want people-- Latinos and African-Americans-- at the lower end of the economic ladder to have ownership stake. What we are talking about is a very responsible approach to preserving the core of the program. This is not an effort to supplant the core of the program but to supplement and strengthen. And I can tell you right now, you would have a substantially higher number of losers. They happen to be our children. And they would probably happen to be losers when Gore, if he was President, was out of office. That is why Governor Bush's position is a true leadership position because what he's talking about is not a risky scheme. The risky scheme is to stay attached at the hip with the status quo.

RAY SUAREZ: Well, the Governor has talked also about no reduction in benefits. I'm wondering how you divert away 2 or 2.5% of what Americans are paying in taxes now and not reduce benefits because that money is supposed to be channeled into the system and going out to people as checks.

KENNETH BLACKWELL: What he essentially said is that over the next ten years, there will be a surplus of about 2 trillion dollars. What he wants to do is to put that $2 trillion against the cost. What that does, it guarantees to people who are presently in the system that their benefits will not be cut and it guarantees to those folks who are right at the margin of becoming retirees that their benefits won't be cut. But it gives the younger generation an opportunity to invest in their future and to have a Social Security... socially secure future. Now, I can just tell you right now, this is typical Al Gore. It is, you know, divide, divide, divide. What Governor Bush has proposed is a proposal of win, win and multiplication. He is avoiding inter-generational warfare and I think that's good for the country.

RAY SUAREZ: Alicia Munnell.

ALICIA MUNNELL: Yes. I think your point about putting the system at risk is very right. We have a deficit equal to 2% of payrolls right now. If everybody took advantage of the Bush proposal and put 2% of their payrolls into the individual accounts, we would double the deficit. Then you would either have to put more money into the system or cut benefits. Governor Bush has made a pledge not to put any more money into the system. Therefore his plan involves an enormous cut in benefits.

RAY SUAREZ: Alicia Munnell, give us the simplest explanation of what the Vice President would like to do instead.

ALICIA MUNNELL: The Vice President wants to stay with the current structure of the program. He understands that this program is particularly beneficial for low-income individuals. He would meet part of the deficit in the program by putting in some general revenues that are equal to the interest savings that come from using the Social Security surpluses to pay down the debt.

MICHAEL TANNER: The Vice President essentially is not reforming the system. Both the Congressional Budget Office and the General Accounting Office have looked at the Vice President's proposal and said, "this is not reform. It is simply a promise that we're going to tax people in the future in order to continue to pay benefits at the levels that are promised." The system needs fundamental, structural reform. It is $21 trillion in debt. And it is going to provide a poor rate of return to young workers and it does not give individuals ownership. The Vice President doesn't address any of those problems. He doesn't keep the system solvent. He doesn't increase the rate of return, and he doesn't give individuals ownership and investment in this economy.

RAY SUAREZ: Edi Rasell.

EDITH RASELL: Vice President Gore's plan does provide for a secure future for people. He makes the system totally solvent for the next 50 years. Beyond that, if we do nothing different than what we're doing now, we have more than two-thirds of the money we need to pay all benefits. So there is no need to get rid of really the most important feature of the system, and that is the guaranteed income -- the social insurance feature of the program. We can make small adjustments in the future, if need be. The projections that we all use are based on fairly pessimistic projections for the economy. If the economy does well, the problem is even smaller than what we've described. There is no need to dramatically restructure this program. I think one of the most dangerous parts of what's been proposed today is voluntary nature evidently, we don't know all the details-- but it appears that Governor Bush is proposing voluntarily... sorry. That people will volunteer to opt into these private accounts. Now what this means is that some people probably will. And I think it's more likely that the upper-income people will because they stand to gain the most from doing it. And that means the more moderate-income people who actually benefit most greatly under the current program would stay in the current program. This is dangerous both economically and politically, I think.

RAY SUAREZ: Let's talk a little bit more about the assumptions built into the Gore plan. You're assuming surpluses that stretch out into the future for a while and also making a sort of sophisticated macro economic argument, aren't you, Alicia Munnell, that there are effects in paying down the national debt that would be felt in the broader economy and help spur on the solvency of the system?

ALICIA MUNNELL: I wish I could claim that it was sophisticated. It's not that sophisticated. It's very fundamental notion that if we save today and invest today, we'll have more equipment, we'll have more highly trained workers, we'll have a higher GDP in the future and that will make it easier to support workers in the future, so it's based on paying down the debt and saving, which is very sensible when you have a large aging population.

RAY SUAREZ: But you're proposing using interest savings, aren't you, to pay future benefits?

ALICIA MUNNELL: The interest savings are just a metric to determine how much of general revenues should be put into the system. So it's a fixed dollar amount that will be put in over a period of time.

KENNETH BLACKWELL: What he is talking about doing is propping the system up with IOU's. Those IOU's will come due, they will come due, you know, to our children. That means that at that point when they come duethat they're going to have to increase taxes 20, 25%. That's a wallop.

RAY SUAREZ: Would they have to increase taxes if there's no longer any national debt?

ALICIA MUNNELL: Because we save today....

KENNETH BLACKWELL: Yeah.

ALICIA MUNNELL: ... The economy will be much stronger and able to bear that burden and the Treasury will be in a much stronger position because it will not have a huge debt outstanding by the public.

KENNETH BLACKWELL: This is simple.

ALICIA MUNNELL: And then they will be able to finance that amount.

KENNETH BLACKWELL: This is simple. Al Gore is talking about the typical big government expansionist intrusion approach. And George Bush is talking about developing a bipartisan working in concert with Senator Moynihan and Senator Kerry and other Democrats and Republicans to make sure that we have a solution that is broadly based and doesn't divide us generationally, doesn't divide income wise and doesn't divide us by race and ethnicity. This is truly a coalition-building approach that will benefit all but particularly low-income workers who want a stake in America's prosperity. Al Gore is slamming a door in their face. He is a 21st century public policy Luddite....

RAY SUAREZ: He's been talking about generational... I'm sorry. Go ahead. Alicia Munnell.

ALICIA MUNNELL: Dramatic change in a program that functions extremely well on which many people depend for their retirement income and will in the future is not necessary and will not improve the security of older workers in the future. It will harm them.

KENNETH BLACKWELL: A dramatic change? 2%. Come on, Alicia.

ALICIA MUNNELL: 2 percentage point is a large portion of a 12.4% payroll tax. It will double the size of the deficit in the program.

RAY SUAREZ: You can be sure that we're going to be discussing this again down the road. Guests, thank you all.

KENNETH BLACKWELL: Thank you.

FOCUS - PAPER & INK

RAY SUAREZ: "Life" Magazine's last monthly issue is now on newsstands. Media correspondent Terence Smith reports on the end of "Life," and the changing world of magazines.

TERENCE SMITH: "Life": To see it was to see the world. In its heyday, founder Henry Luce once said, it was "what the public wants more than it has ever wanted any product of ink and paper." But the May issue of "Life," now on newsstands, is its last. After ceasing publication as a weekly in 1972, its monthly edition will now be gone, as well. "Life" is the latest victim of an extraordinary revolution that is under way in the magazine industry. The once-great general interest giants are being crowded out by a vast new crop of special interest titles. Over 800 new magazines were launched last year alone, more than 1,000 the year before, an average of three new titles a day.

DON LOGAN, Chairman & CEO, Time Inc.: Advertisers like to run their ads in magazines that address some topic, some subject, some issue that... "Niche" is the word that's used very commonly today.

TERENCE SMITH: Don Logan is chairman and CEO of the house that Luce built: Time, Incorporated. He says he could not see the kind of future for life that looks so promising for other, more targeted magazines.

DON LOGAN: We look for a couple of things: One is that we expect our readers pay a fair share for the magazines that we deliver. And the other is that we want that some advertising base that will be there to support the magazine. "Life" didn't have a core of advertisers that had to be in "Life" every month.

TERENCE SMITH: Time, Inc. has 36 magazines, including "People" and "Sports Illustrated." Brand-name spin-offs like "Teen People," and "Time for Kids," the nation's fastest-growing student publication, with 2.7 million copies weekly...

WOMAN: This is beautiful.

TERENCE SMITH: ...Are exceeding expectations.

WOMAN: This one has more emotional impact.

TERENCE SMITH: Significantly, Time, Inc., which grossed $4.7 billion last year, is aggressively launching six new magazines, even as it folds "Life."

WOMAN: I think that's the clear winner.

WOMAN: It really says summer.

WOMAN: Do you want to be there?

WOMAN: Oh, yes.

WOMAN: Yes.

WOMAN: I'd like to be there right now.

TERENCE SMITH: One of the new entries, "Real Simple," launched in April with 112 ad pages, is targeted to the stressed-out young woman who is trying to have it all.

WOMAN IN AD: I thought if there were a magazine that helped people create balance in their lives, that would be a really useful thing. And I think that women's lives, I like to say, are like those chinette paper plates with three compartments on it, except women are always trying to put six things on top.

TERENCE SMITH: "Real Simple" will be fighting with the thousands of other new magazines trying to capitalize on the booming economy.

MAN: We probably have a dozen or 15 tattoo magazines.

TERENCE SMITH: Samir Husni, a journalism professor at the University of Mississippi, is a consultant to the magazine industry. Amidst the boom, he says, things go wrong.

SAMIR HUSNI, The University of Mississippi: It's easy to start. Whether to stay in business is the hard question. 50% of all new magazines don't even celebrate their first anniversary. They are dead after the first year. And after four years of publishing, we have two out of ten who remain in business.

TERENCE SMITH: Even ambitious glossies can fail. "Mirabella" and "New Woman" folded this spring. "George," the politics and entertainment monthly started by the late John F. Kennedy, Jr., is searching for a new identity. And then there is "Talk." It had a splashy debut, and has a celebrity editor, Tina Brown, but there has been very little talk about "Talk." The moral: Know your audience. Success comes to those who do. "Maxim," dubbed "the national anthem for frat houses," is the current magazine of the year in "Advertising Age." After only three years in the U.S. Market, Dennis Publishing's British import is selling two million copies a month. Its target: The elusive 18- to 34-year-old male.

SAMIR HUSNI: They went after the circulation. They went after... "Okay, we know you are out there, we know these are your areas of interest, and we are going to highlight them in every single issue: Sports, sex women, beer, gadgets." And when we reached two million, they went to advertisers and said, "hey, look at this generation, look at those people, look at how much money they are spending. We can deliver them to you on a silver platter."

TERENCE SMITH: But many of the new entries focus on the American deities: Sports and entertainment celebrities.

NEAL GABLER, Author, "Life the Movie:" Celebrities are one of the few things that cut across demographic groups. Everybody knows celebrities. They are the common currency of conversation in this country.

TERENCE SMITH: Cultural historian Neal Gabler is author of the book "Life, the Movie: How Entertainment Conquered Reality."

NEAL GABLER: It's the entertainment that you have to focus on. The primacy of entertainment in American life-- that converts our politics into entertainment, our religion into entertainment, our education into entertainment, and virtually all of our magazines intovehicles of entertainment.

TERENCE SMITH: With so many magazines to choose from, celebrities sell. A newsstand reader glances at a cover from 2.5 to four seconds. A familiar face may provide an edge.

SAMIR HUSNI: The minute you identify with the image, or you unite with the typography, I have a better chance, a 50% more chance, that you are going to buy my magazine. We tell designers and editors you have a cover that says, "pick me up", I mean it has to be like punching you in the face the minute you see it. If you lose that first second, you're out.

TERENCE SMITH: Competition for magazine rack space is fierce, particularly for those magazines that rely heavily on newsstand sales, rather than subscriptions.

SAMIR HUSNI: There is not that much more magazine space, and we have double or triple the number of magazines that we used to have in 1980. Placement on the racks is very important, and why, for example, Oprah's magazine is going to spend hundreds of thousands of dollars to be placed on the checkout counter, so you can see it. You can't leave the grocery store without seeing the big "O!"

SPOKESMAN: Oprah!

TERENCE SMITH: Oprah Winfrey's new entry, published by Hearst magazines, is a triumph of the new multimedia approach. The magazine and Winfrey's enterprises in TV, film production, and the Internet will serve to promote each other. And what is the consequence of this explosion of titles and cross-promotion?

NEAL GABLER: Once upon a time, magazines competed with other magazines. "Time" competed with "NewsWeek," competed with "U.S. News and World Report." That was the competition. That's not the competition anymore. Now magazines compete with the larger culture. You can read a magazine, or you can watch television, you can read a book, you can go on the Internet, you can go to a movie. So now, a magazine, in order to survive, has to provide things that those other forms of entertainment provide. That's the competition now.

TERENCE SMITH: One of every five adult Americans still reads a newsmagazine. But the weeklies have become more lifestyle-oriented, less focused on hard news. And the new approach seems to be working. "Time" Magazine has had record profits for the last two years, when it has run covers on homework and hip-hop.

WALTER ISAACSON, Time: You can see the sort of pacing of how we do things around here.

TERENCE SMITH: Walter Isaacson is managing editor of "Time" Magazine.

TERENCE SMITH: Is this the death of news as Henry Luce defined it?

WALTER ISAACSON: I certainly don't think it is the death of news. I think we almost killed news by deciding that official pronouncements out of national capitals was the only definition of news.

SPOKESMAN: A lot of us are leaving Monday on this Mississippi River trip.

TERENCE SMITH: "Time," for example, is planning a heavily promoted July 4 issue on the "Pulse of America," highlighting people who live along the banks of the Mississippi River.

WALTER ISAACSON: News involves ideas, events, people's actions that affect our lives on a daily basis...

SPOKESMAN: Can we do this for the next 20 years?

SPOKESMAN: Once you get it in your blood, it's just hard to quit.

WALTER ISAACSON: How our kids grow up.

SPOKESPERSON: Are there a lot of teen parents in this community?

SPOKESPERSON: Yes, there is.

WALTER ISAACSON: ...How our communities are developed, how our downtowns look.

SPOKESMAN: It's like downtowns many places. They are gone because of malls and Walmart, and all those kind of stores.

DIANA WALKER: I'm gonna take your picture while I talk to you, if that's all right.

TERENCE SMITH: "Time" photojournalist Diana Walker.

DIANA WALKER: We are still doing the news on the outside, hard and heavy. But we also have a different look to show our readers, which is what... hopefully what goes on behind, away from the mikes and lights.

TERENCE SMITH: Much has been written about how the Internet may someday eclipse traditional magazines, but so far at least, the web has been a financial bonanza for the industry. Don Logan.

DON LOGAN: The fastest-growing category of advertising we have now is internet companies, and what are they trying to do? They are trying to establish a brand.

TERENCE SMITH: Even the Internet-savvy are turning to magazines for advice.

DON LOGAN: When people want to learn about the Internet, they don't go online and start picking through a bunch of buttons; they subscribe to a magazine.

TERENCE SMITH: Magazines are using the Internet to market their product. "Maxim's" web site brings in over 17,000 subscriber requests each month.

SAMIR HUSNI: We are using the Internet as a testing ground. Give us your ideas of what type or articles you want, and then boom, we bring them the articles in print.

TERENCE SMITH: And what does the future hold?

DON LOGAN: I expect you are going to see a lot of additional spin-off titles come out of there, as well as new titles that fill new niches as well. But we are going to be on the Internet. At the same time, we expect print and print- related products to be producing most of our profits.

TERENCE SMITH: Plain old paper and ink?

DON LOGAN: Absolutely.

TERENCE SMITH: Paper and ink: Henry Luce would have loved it.

RECAP

RAY SUAREZ: Again, the major stories of this Monday: The U.S. Supreme Court issued another major decision upholding states' rights. The justices threw out part of a law letting rape victims sue their attackers in federal court. Texas Governor Bush proposed letting Americans invest part of their Social Security taxes in private accounts. And at least four Palestinians were killed and more than 320 were hurt in clashes with Israeli troops. 14 soldiers were injured as well. We'll see you online, and again here tomorrow evening. I'm Ray Suarez. Thank you and good night.