The MacNeil/Lehrer NewsHour

MR. LEHRER: Good evening. I'm Jim Lehrer in Washington. After our summary of the news this Thursday, President Clinton's chief economic adviser, Laura Tyson, explains the President's new budget. We continue our series on health care reform with a debate about requiring all employers to provide health insurance coverage. Essayist Richard Rodriguez talks about the other people in the Zoe Baird and we close with a remembrance of the great voice of Marian Anderson. NEWS SUMMARY

MR. MacNeil: President Clinton sent the details of his 1994 budget to Congress today. Congress has already passed an outline of the plan but today's document provides a line by line accounting of the $1 1/2 trillion to be spent next year. It also spells out in nearly 1500 pages how the President plans to achieve more than $1/2 trillion in deficit reduction over the next five years, including cuts in defense and domestic spending and higher taxes on the wealthy, corporations and energy users. Budget Director Leon Panetta had this to say at a White House briefing.

LEON PANETTA, Budget Director: This is the economic plan. It remains, I believe, the most honest and comprehensive budget in recent history. And I think Congress has enhanced it by adopting its own budget resolution to complement what his being presented here in the budget. It's a courageous budget. It asks every American to contribute to our economic future, senior citizen, federal workers, doctors, hospitals, farmers, the wealthy, everyone, to try to contribute to this effort to put this country back on the right track. There's more to come. There obviously will be difficult battles along the way, but we have taken the first major step in changing the direction of this country.

MR. MacNeil: President Clinton did not attend today's budget presentation. He left for Little Rock this morning following the death of Mrs. Clinton's father, Hugh Rodham Republicans were quick to attack the plan. Congressman Christopher Cox of California said, "Democrats finally know the details of what they voted for, and it should make them nervous." Senate Minority Leader Bob Dole had this reaction. He spoke on Capitol Hill.

SEN. BOB DOLE, Minority Leader: It's a "tax and spend" budget. It's what theDemocrats want to impose on the American people. And it's not going to sell on Main Street because I've just been on Main Street, and as recently as yesterday, in my home town of Russell, Kansas, and I can tell you people don't trust the Congress. They don't particularly trust anybody in government to cut spending. That's what they want us to do is cut spending, don't raise my taxes, cut spending, start with Congress, start with the Executive Branch, and they're not going to get that in this package.

MR. MacNeil: We will discuss the budget with the chairwoman of the President's Council of Economic Advisers later in the program. The Producer Price Index which measures inflation at the wholesale level rose .4 percent in March, the same amount as February's increase. The Labor Department report said higher food and energy prices were the main reasons. Jim.

MR. LEHRER: Two men have been arrested in Miami for the brutal murder of a German tourist last week. The victim was named Barbara Jensen. She was attacked while driving her rental car from the Miami Airport. Her mother, her six-year-old son and two-year-old daughter watched while she was beaten, robbed, and then run over and killed. The suspects were identified today as 23-year-old Anthony Williams and 18-year-old LeRoy Rogers. They were found in the Dade County Jail, where they were being held on unrelated robbery charges. Police said the arrests were made last night. Miami's police chief talked about it at a news conference today.

CALVIN ROSS, Miami Police Chief: We'd like to serve notice on those individuals that prey on tourists and that prey on the citizens within this city that as a result of this arrest and some future arrests the police department is not going away, we're going to be here, and we will get you, may not get you today or tomorrow, but we're going to get you. We, just as the citizens of this city, we're fed up and we're sick and tired of the type of offenses that we've seen on the streets of this city.

MR. LEHRER: Yesterday two other suspects were arrested for an attack against two other German tourists last month.

MR. MacNeil: NATO officials meeting in Brussels decided today to begin forcing the U.N. no-fly zone over Bosnia next Monday. The mission, NATO's first combat role since its founding in 1949, will be carried out by 70 warplanes from the U.S., France, and the Netherlands. In Bosnia today, a U.N. convoy delivered relief supplies to the besieged Muslim town of Srebrenica. A few hours later, the truck crossed Serbian lines to Tuzla, carrying 1400 Muslim refugees. A similar mission yesterday was abandoned when Muslim officials refused to let the refugees leave on the U.N. trucks. At the world court, Serb-led Yugoslavia was ordered to stop acts of genocide against Bosnia. The court has no power to enforce the ruling. The court did not respond to Bosnia's requests that it be exempted from the U.N. weapons embargo.

MR. LEHRER: The space shuttle Discovery blasted into orbit early today from Cape Canaveral, Florida. The liftoff at 1:29 AM Eastern Time was without incident. Two days ago technical problems stopped the countdown 11 seconds before launch. The crew's mission is to conduct atmospheric experiments on the Earth's shrinking ozone layer. They are expected to stay in space eight days.

MR. MacNeil: Marian Anderson, the singer who became a symbol of the civil rights movement, has died at the age of 96. She was the first black performer to appear with the Metropolitan Opera, but she is perhaps best known for her 1939 concert at the Lincoln Memorial where she sang before a crowd of 75,000 people after the Daughters of the American Revolution denied her the use of their Constitution Hall. She suffered a stroke last month and died at the home of her nephew in Portland, Oregon. We'll have more on Marian Anderson later in the program. Now it's on to the Clinton budget, mandating health insurance for business, and a Richard Rodriguez essay. NEWSMAKER

MR. LEHRER: We begin tonight with Laura Tyson, President Clinton's chief economic adviser. She's here for a Newsmaker interview about the $1.5 trillion federal budget Mr. Clinton released today and some of the Clinton factors underlying it. Ms. Tyson, welcome.

MS. TYSON: Thank you very much.

MR. LEHRER: How would you characterize this budget?

MS. TYSON: Well, I would characterize it as a very bold attempt to really reverse course in this country, to move on a sustainable long-run deficit reduction path, and to do it at the same time that we shift government spending priorities to investment programs for the future.

MR. LEHRER: You say bold. What's bold about it?

MS. TYSON: Well, what's bold about it, it's first of all reversing course. When we started this process, we looked out there and we saw that the deficit was going to increase relative to the size of the economy, and what we have done is we have taken a series of spending cuts and revenue increases, and we're halving the deficit as a percent of GDP over a four or five year period, and at the same time that we do that we're actually asking for a major shift in government spending to spending programs for the future, spending on our roads, spending on our children, spending on our civilian technology.

MR. LEHRER: Well, let's go, go through that. The major -- I saw a list today from the budget of 22 federal agencies, departments, and et cetera. There were only two of them that took cuts from '92 through this budget of '94. That's the Defense Department and the Labor Department. Is that a bold approach? How does that qualify, in other words, as a bold approach to federal spending?

MS. TYSON: I think you have to first of all two things are true about our package: No. 1 is that we have, it's a multiyear package. We phase in cuts starting in '93 and going through '97 and continuing on thereafter, so initially our program starts relatively heavy on the revenue side, but we build up and build in spending cuts over the four year period, and then, as I said, extending out, and we actually have 200 specific items cuts. We have a $45 billion cut overall in the cost of government, something that Sen. Dole was talking about in the news part of the program. I really disagree with him. We have asked for and identified $45 billion of savings in the cost of administration across agencies.

MR. LEHRER: But his point, picking up on the point that he made that, that the real emphasis, and it's not only Sen. Dole, Ross Perot, some moderate Democrats in the Senate and in the House have said the same thing, that, that your budget plan is out of sync to where the country is now, in other words, everybody's in favor of deficit reduction, but they want it done through cuts in federal spending, rather than through raising taxes.

MS. TYSON: Well, I think you actually have to -- people say that -- you have to actually look at the numbers and look at what it is we could cut, and then you realize, I think, that we have made a series of cuts that can be made that will have an effect, but if you look at the numbers, some of our big spending on it -- let's look at defense. Defense with our cuts is now going to be the lowest percentage of GDP that it's been in post World War II history. So we're raking substantial defense cuts. Look at another spending idea of ours, interest payments on the debt. The government now spends something like 14 percent of its budget on interest payments on the debt. The only way to get those interest payments down, we can't cut them directly. We have to cut the deficit, cut the government's need to borrow and cut interest payments on the debt. The other two big items that one could think of cutting are Medicare and Medicaid, health care spending. We're dealing with that through a separate reform package which we will be introducing by -- the task force intends to report sometime in May to the President, and then you have Social Security. And Social Security as a percentage of GDP, relative to the size of our economy, has actually been brought under control already. So in some sense the notion we could find cuts all over the place to reduce the deficit more than we have is actually, I suggest to people they actually look at the composition of government spending and they'll realize that this is a very hard process to engage one's self in.

MR. LEHRER: So somebody sitting out there in Russell, Kansas, as Sen. Dole said, and say, well, wait a minute, why aren't these Clinton people downsizing the federal government, the domestic programs, all of that awful bureaucratic waste in Washington, what do you say to them?

MS. TYSON: I say that we have the $45 billion cuts in the cost of administering the government. We have a reinventing government - - excuse me, we have a reinventing government effort that is headed by the Vice President to look for various ways to improve the efficiency of all of the government agencies. We are looking for a gradual decline in the federal work force of a hundred thousand people through attrition, so we are, in fact, committed to the notion of addressing waste and addressing -- I won't even call it waste -- streamlining the process of government just as American companies are streamlining their own production processes. We are going through the same process.

MR. LEHRER: Now one of the things that has got things stuck right now, one of the things that's got things stuck right now on Capitol Hill is the economic stimulus package.

MS. TYSON: Yes.

MR. LEHRER: $16 billion, the President says, and I assume you agree with him, it is necessary to get the economy going again. What, what, on what is that based?

MS. TYSON: It's based on the notion that we have had a very slow economic recovery. We have been officially in economic recovery for 23 months, 23 months. Most Americans don't realize that we have officially been in recovery.

MR. LEHRER: Officially --

MS. TYSON: Meaning relative to how we measure a recession is over.

MR. LEHRER: Right.

MS. TYSON: When output doesn't decline anymore but starts to increase. But the problem is the increase in output has been so slow, the increase in production has been so slow, that in those 23 months we have created a little more than 800,000 jobs. That is not -- that is a very poor record. In most economic recoveries that the U.S. has gone through in its recent economic history we should have at least 3 million more jobs. This has been too slow, and all we want to do is use a series of tax incentives and government spending programs to move the recovery to a slightly faster rate to generate some additional jobs for Americans who have been out of work for too long.

MR. LEHRER: But, as you know, the Republicans in the Senate and with some help from some Democrats, are saying, wait a minute, the economy doesn't need it, but more importantly, it flies in the face of the stated goal of the Clinton administration, which is to reduce the deficit.

MS. TYSON: The Clinton administration has a goal, I would say, of having a fully employed, high growth economy. The stimulus package, the jobs package is meant to increase employment. The deficit reduction part of the package is meant to allow the economy to grow more rapidly in the future by bringing long-term interest rates down. So it's a package. It has coherence. You start by making the economy a little stronger, then you introduce deficit reduction, which helps the economy move forward at a faster clip.

MR. LEHRER: Of course the thing is stymied now in the Senate. The President has said he's willing to compromise. What does that mean? What does he want to compromise about?

MS. TYSON: Well, I think we are, it's very important to use to have as much of the stimulus as we can possibly achieve. I think that there are certain parts of it which are absolutely essential, immunization, summer jobs programs, some of the infrastructure programs, areas where we really feel not only will we get significant job creation but we'll be adding to the long run capabilities of the economy by building up a, building up skills in the work force, building up the infrastructure on which the private economy depends, making the work force healthier over time. There are a number of ways that the government can spend money to help the private economy. A lot of the debate I think really misses the point that not all government spending is the same. Not every dollar that the government spends is a withdrawal of benefits from the private economy. If the government spends money on roads and the private sector uses those roads to move people and goods and services around, that's government spending that helps the economy. So we want to shift government spending and we want to make sure that we're working on those parts that will help the economy perform better.

MR. LEHRER: You are the President's chief economic adviser. The economy of the United States of America is underlying all of this, the huge document that you all released today.

MS. TYSON: Yes.

MR. LEHRER: When you look ahead to the next year and the year afterward and overlay this document, this budget -- let's assume that the Congress passes it pretty close to what you all want -- what is the economy of the United States going to be like a year from now, two years from now?

MS. TYSON: Well, let me say that we, one thing also I should emphasize about the package is that the amount of deficit reduction that we project in there I believe will turn out to be an underestimate because deficit, the growth of the deficit or the reduction of the deficit depends upon how fast the economy grows as well. If the economy grows more quickly than is the underlying forecast on which those deficit numbers are based, the deficit will come down faster.

MR. LEHRER: And the reason for that is --

MS. TYSON: Well, when the economy grows faster, the government takes in more revenue simply because there's a bigger tax base.

MR. LEHRER: And spends less.

MS. TYSON: And spends less because you don't have to spend as much on food stamps, unemployment compensation, welfare programs, any program that the government used to help people through a difficult economic time. So we believe that the economy will grow more quickly than, in fact, the, there is a Congressional Budget Office economic forecast on which the deficit forecast we have included in our document is based. That CBO forecast is quite pessimistic, I believe unrealistically so, given that they start with an assumption about 1992, which is wrong. They underestimate what we actually realized in 1992, so we have a, what we call an administration forecast. We didn't use it in the deficit projection numbers because we didn't want to be accused of being excessively optimistic --

MR. LEHRER: Cooking the numbers.

MS. TYSON: -- cooking the numbers, rosy scenario, and there they go again, but I truly believe that our forecast is essentially a conservative forecast. We have projected for this year and next year with a stimulus, I want to emphasize, with a stimulus a three one growth rate this year, a three three growth rate next year.

MR. LEHRER: Is that terrific?

MS. TYSON: That is certainly much better than the one to one and a half percent we have seen in these twenty-three months of recovery. It would be nice to see more, but I think what we want to do is make sure we get at least that much, and that's why the stimulus is very important to us.

MR. LEHRER: What about, what do you see unemployment being these next few years?

MS. TYSON: Well, we see the unemployment rate trending down to about a six nine this year and a six seven or so next year, so trending down gradually, we'd like to get it to trend down faster, and we hope that that happens. Again, we chose to be conservative so that we would not be accused of being excessively optimistic. And I think that's the right thing to do since the American people are, I think, feel themselves to have been burned by previous attempts to project things out, making them look better than they actually turned out to be.

MR. LEHRER: You and the President and others in the administration have made the point from the very beginning, since February, since the President first announced this overall thing in February, that, that this is a big package, and there are a lot different pieces, and they all must be enacted in order for it to work. Let's assume for discussion purposes that the stymie continues in the Senate and the President backs off and he has to compromise, he doesn't get the stimulus package. What does that do to your projections?

MS. TYSON: Well, I think what it does is that you have to understand that the stimulus package, itself, is a moderate package exactly for the reasons we talked about before. We had to be aware of our long run deficit constraint when we put together the stimulus package. If we take away the whole package, which incidentally is the spending plus some tax cuts that we haven't yet negotiated on, the total size of the stimulus package, both the tax cuts and spending, which is about $30 billion, our estimates are that that creates about 500,000 additional full-time equivalent jobs. Now that means if we don't have any stimulus, we will be short 500,000 jobs for the period 1993/1994. That's what it means. And if we had been able to have a stimulus twice as large, we would be then, the missing amount would be twice as large. So I think of it in terms of foregone job opportunities for Americans.

MR. LEHRER: Finally let me ask you a semi-personal question. What is the -- you came from California. You were in the academic world before you came, had done a lot of writing, a lot of studying, everything about the economy. But now you're "hands on" here since January. What is the biggest surprise, the biggest thing that you didn't quite expect in doing what came out today, in putting a budget together for the United States of America?

MS. TYSON: Well, I suppose the issue is that for me, for example, it's very clear to me the distinction I made to you before. If I were teaching an Econ I class, and Economics I class, principles of economics, I would be able to explain and people would listen why a dollar of spending in an economy which has a lot of unutilized capacity is good for the economy, and I would also be able to explain why a dollar of government spending on infrastructure or research and development is not the same as a dollar of government spending on, for a public official to travel. Okay, those are not the same.

MR. LEHRER: Sure.

MS. TYSON: In the debate, which gets to be a heated and partisan debate, the notion is that somehow every dollar that government spends is actually harmful to the economy, and that is simply not true. It's not true by our own historic experience. It's not true by any international comparisons that we would look at. Sometimes government spending can be good for the economy, and I suppose that's the biggest surprise, that I can convince a classroom of students of that, there are principles of economic textbooks that are nonpartisan which demonstrate that. In a partisan situation, it's hard to make that case.

MR. LEHRER: Republican Senators are not students of Econ 105 or I.

MS. TYSON: Or if they have been in this particular situation that's not exactly what they're addressing.

MR. LEHRER: I hear you. Laura Tyson, thank you very much.

MS. TYSON: Thank you.

MR. MacNeil: Still ahead on the NewsHour, the debate over making business provide health insurance, a Richard Rodriguez essay, and remembering Marian Anderson. SERIES - OPTIONS FOR CHANGE

MR. MacNeil: Next, another in our series of debates over the options for reforming health care. Tonight we'll discuss employer mandates, a policy that would require all employers to provide health insurance for virtually all of their employees. The President's task force is considering such mandates as one of several measures to ensure universal health care for all Americans. We look first at the state of Hawaii, the only state which requires all businesses to provide health insurance. Correspondent Jeffrey Kaye reports.

MR. KAYE: Unlike millions of other Americans, when residents of Hawaii enter clinics and hospitals, they generally know that most of their costs will be paid by insurance. The vast majority of Hawaiian residents are covered by health plans carried by employers. Under state law workers pay a portion of the insurance, 1 1/2 percent of gross wages, or half the premium, whichever is less. While employers can choose their health plans, the law requires a minimum package of benefits. Those include full hospital care of up to 150 days a year, emergency services, physician visits, maternity and well baby care. Dr. John Lewin is director of the state's health department.

DR. JOHN LEWIN, Hawaii Health Department: Every worker in this state who works 19 hours or more has a health insurance policy as does his or her family members if they so choose.

MR. KAYE: And if you work fewer hours than 19?

DR. JOHN LEWIN: Then you're covered by a program which we developed here in the last two years called SHIP, the State Health Insurance Program, where it's a split cost between you and the state of Hawaii.

MR. KAYE: According to Dr. Lewin, the system emphasizes prevention.

DR. JOHN LEWIN: And that's part of the reason our rates are low. Our outpatient visits are twice the per capita number as the rest of the country, twice as many visits to the doctor's office, to the primary care provider's facility, but the inpatient the super expensive visits, are half to two-thirds the national average, and that's been a source of savings of cost, and that's also part of the information as to why people live longer with cancer and heart disease, et cetera. They get diagnosed sooner.

MR. KAYE: But Hawaii's system of universal health care coverage does not get universal acclaim from the business community. Some companies, small businesses, in particular, consider employer- mandated insurance an unnecessary burden. The Kona Ranch House, a restaurant in Kilua Kona, employs about 60 people. Owner Bill Brye says it costs him about $5,000 a month to provide the required health insurance. That's 5 percent of his monthly earnings, and that's just for starters.

BILL BRYE, Restaurant Owner: Other than health care you must provide all types of different insurance, worker's compensation, general insurance, liability insurance, unemployment insurance, all of which eats away at the bottom line, if there is any.

MR. KAYE: And you think then that this is too much of a burden for you?

BILL BRYE: I think it could be spread out in a different way.

MR. KAYE: What do you say to some of the small businesses who say that it's too much of a burden?

DR. JOHN LEWIN: Well, what I say to them is they're right, of course, but I want them at least to know where we're starting from, that in Hawaii small businesses are buying insurance policies that cost between a thousand and twelve hundred a year for their employees, or three thousand a year for their families. They don't know what's going on in America today, where the prices are twice to three times that wherever you go and where they are literally excluded from buying coverage and underwritten. And if somebody in your business has diabetes or AIDS, the whole company is either thrown out or the rate's tripled. That doesn't happen in Hawaii.

MR. KAYE: Doesn't happen because employees around the state make up what is essentially one large insurance pool. 60 percent of the state's population, some 670,000 people, are insured through one company, the Hawaii Medical Service Association, Blue Cross/Blue Shield of Hawaii. Marvin Hall is the company's president.

MARVIN HALL, Hawaii Medical Service Association: We would never cancel anybody. We would never fail to enroll any employer. And if you have the worst kind of experience, you would still pay the standard rate just along with anybody else.

MR. KAYE: And what about the system enables you to do that?

MARVIN HALL: We're guaranteed that within an employer every employee is going to buy coverage, not just the high risk people. So we're into an employer, we're going to get the good with the bad.

MR. KAYE: So the fact that there's a mandated system guarantees a large pool and helps cut the risks.

MARVIN HALL: Keeps the risk down, yes, definitely.

DR. JOHN LEWIN: I can give you a whole list of flaws in the Hawaii system. It's just that we're light years ahead of everybody else, and we've got some incredible results of 17 years of duration that need to be examined. The people of Hawaii have a system of health care that works better than any place in America.

MR. MacNeil: Now four members of the business community to discuss the merits of mandating all employers to provide health coverage for their employees. George Moehrle, a masonry contractor in Frederick, Maryland, is president of the Maryland Chapter of Citizen Action, a national organization campaigning for national health insurance. Robert Patricelli, the president of a Connecticut-based managed care company, chairs the U.S. Chamber of Commerce Health & Employee Benefits Committee and sits on the chamber's board of directors. John Motley is vice president of the National Federation of Independent Business, which represents 600,000 small businesses. In Los Angeles, Margaret Jordan is a vice president for Health & Employee Services of Southern California Edison. Mr. Patricelli, you support an employer mandate as in Hawaii. Why has the Chamber of Congress changed its traditional position against such mandates?

MR. PATRICELLI: Robin, the Chamber supports the mandate of employers, of individuals that they have insurance, and of government supporting that system. We came to the conclusion that if you're in favor of universal access to health care in this country, and we are, you've got to have a way in which people will have insurance. And for us, it wasn't a question of philosophy, should there be a mandate or not, it was a question of who pays. Government now imposes numerous mandates for better or worse on business. The question is whether or not low wage workers and their employers will be subsidized by government to help meet the costs of insurance.

MR. MacNeil: You mean like the restaurant owner in Hawaii we saw there who says that for him it's too much out of his bottom line?

MR. PATRICELLI: That's exactly the point. We think all employers can afford something. In fact, all employers now provide contributions to the Medicare Trust Fund. So they do that already, but many employers can't afford very much, and that's where government has to step in and help those employers who can't afford the full benefit.

MR. MacNeil: So are you saying the Chamber of Commerce, with all its influence, would not support the Clinton administration in imposing an employer mandate if it didn't also have a subsidy for employers with low wage, a low wage base, is that right?

MR. PATRICELLI: Exactly correct. We've made clear to the administration that it would be a deal killer for us to have a mandate without subsidy, a mandate that produces job loss is not good social policy.

MR. MacNeil: Why would it produce job loss?

MR. PATRICELLI: Well, if employers were required to pay all themselves most of the cost of a $4,000 insurance policy, many small employers would not be able to pass that cost on in the cost of their products, and they would have to fold or cut employees.

MR. MacNeil: Thank you. Mr. Motley, you and your organization representing 600,000 small businesses oppose the employer mandate. Would you explain why.

MR. MOTLEY: Well, it's really very simple, Robin. We feel that health insurance today is a fringe benefit which is provided by employers to their employees in order to secure good employees. What an employer mandate is going to do is to make American employers responsible for the health care of all current and future employees in the United States. And we simply don't believe that there are many small employers across the country who can afford that. What is going to happen, and the previous speaker said so, is an awful lot of those small employers are going to release their employees. They're are many, many reputable estimates out there, some of them provided when we took a look at "Pay or Play" last year, which indicate that between a quarter of a million and three- quarters of a million jobs will be lost in the economy in the first year. And that won't solve the problem because when the person loses a job, they're going to become eligible for benefits on the other side. They're going to become eligible for unemployment compensation, for food stamps, for aid to families with dependent children, and for Medicaid, which means that the government is simply going to have to pick up the cost anyway. We think --

MR. MacNeil: What if the government, as Mr. Patricelli suggests, they will make a condition, the Chamber of Commerce will make a condition, subsidizes the employer who finds it difficult to provide insurance?

MR. MOTLEY: Well, I think all you're doing there is taking it out of one pocket and putting it into the other. We're still going to have to raise the taxes. Somebody is going to have to pay for it. One of the things that bothers us at least from a philosophical standpoint is when you make employers responsible for health care you are taking away individual responsibility, and we feel that for this system to work that individuals have to be involved in the decision making process of how to purchase health care intelligently.

MR. MacNeil: You feel so strongly about this I gather you refuse to go and testify when the Clinton health task force invited you, is that correct?

MR. MOTLEY: That is correct. What we wanted to do was to underline the fact that we believe that the task force has already made up its mind on this issue, therefore, since we had spoken to them several times in the past, we wanted to make sure that everybody understood that nine out of ten of our members oppose an employer mandate in health care.

MR. MacNeil: Mr. Moehrle, you also oppose the mandate but I think for different reasons. Why?

MR. MOEHRLE: Well, actually what we, my position is, is that --

MR. MacNeil: Could you just tell us first, how many people do you employ?

MR. MOEHRLE: Oh, we have about between sixty and eighty employees.

MR. MacNeil: Doing what kind of work?

MR. MOEHRLE: Well, we're a masonry outfit. We lay brick and block, building schools, building commercial buildings, that kind of thing.

MR. MacNeil: Okay. So why do you oppose the idea of the mandate?

MR. MOEHRLE: Well, I think what we need to do is to establish a fundamental change in the way we view health care. I think that Mr. Motley pointed out the prevailing view that health care is a fringe benefit. I think we need to change that. We need to take a look at health care as being a public good, a good just like public education, just like highways, just like police and fire protection, just like the national defense. And the mechanism by which we can best fund that is through the government and through a progressive income tax structure on both individual and corporate taxes. Our view is also, as we would agree with the problems that they have on mandate, and our view there is that mandates basically become an added cost to labor, and if you're going to increase the cost of labor, you're going to do two things: One, in the same type of businesses, you're going to make labor more expensive vis a vis capital or other equipment. So when an employer makes a choice in the production process, now suddenly capital and equipment looks stronger than labor, because labor looks more costly. In addition to that, as a masonry contractor, I take a look at the situation and I say I'm going to have to go out here in the market with a heavily labor intensive organization and compete against other people, produce wall systems with less labor intensive systems, or less labor intensive structure. That's going to put me at a disadvantage. I think we need to get away from that. We need to clean up the entire system and approach it from the standpoint and looking at it as a public good and then funding it as such.

MR. MacNeil: So what do you support instead? You support something like what's called the Canadian system here, the one payer with the government paying, is that what you support?

MR. MOEHRLE: I would support an American system but, yes, I believe the Canadians have a system that we can glean a great deal of pieces and structure from. But, of course, it's one that we're going to have to put together that meets the needs of the American people and meets the needs of our society, but a single payer system, one that eliminates 1500 different insurance companies and all the overhead and the cost associated with that, yes, that's a system that I can support.

MR. MacNeil: Just following up on what Mr. Motley and Mr. Patricelli said, would you as an employer of sixty to eighty employees have to lay people off if you were mandated to provide health insurance for all of them?

MR. MOEHRLE: Well, actually there's a certain advantage to me personally if there was a mandated system. Mainly, I provide health insurance for my employees, so right now I find myself at a disadvantage vis a vis those employers who don't because I get my jobs by contract and if you increase my costs, I'm at a disadvantage in winning those contracts. Now, from that standpoint, if they instituted mandates, yes, it would help me in the near- term, but my fear there is it's going to hurt us in the long-term because we need to change our system because of the enormous cost. It's burdening not only individual businesses, but it's starting to choke our economy understanding that by the year 2000 one out of every five dollars that we produce is going to be going to health care. Currently it's over $800 billion. That concerns me.

MR. MacNeil: Ms. Jordan, in Los Angeles, you at Kaiser support the mandate. Why?

MS. JORDAN: I'm at Southern California --

MR. MacNeil: I beg your pardon. I had Kaiser on my brain. Yeah, right.

MS. JORDAN: That's all right. Yeah. Yes. We support it because we believe that all employers need to remain responsible for health care benefits of their workers, and we share that view with a number of groups of employers around, the Washington Business Group on Health & National Leadership Coalition for Health Care Reform. And the reason for that is because historically in this country the employers have been responsible for the health benefits of their employees. It's dated back to depression years, and the issue that we have right now, one of the contributors to health care cost escalation is cost shifting. And when we don't have all employers involved in providing health benefits, the cost gets shifted from those who are not providing it to those who are. You know, the 37 million uninsured and under insured Americans are said to be the majority, are supposedly workers and dependents of workers. And when they receive care that goes uncompensated in terms of the payment for that and hospitals and large employers like Edison wind up playing the bill, so we really need to have everybody in it, and I'd point out the Hawaii system that we just looked at, what they made a point of is that the reason that they can keep their costs lower is because the risk is spread over a large pool, and so everybody needs to be in that pool. I also point out that we're not talking about in health care reform I hope that people will continue to pay the $4,000 a year per employee. We're hoping that part of the health care reform is a reform of the delivery system that will bring the cost of the delivery system down and furthermore, that when we're all in some type of pool situation that we'll be able to really negotiate in terms of what the costs are. So, yes, we really believe that all employers ought to be involved and that we cannot have cost shifting and because cost shifting is not cost containment, nor cost lowering, and if we have some employers out, we will have cost shifting.

MR. MacNeil: Ms. Jordan, how do you answer Mr. Motley, for instance, who says it'll hurt small business and they'll lay off hundreds of thousands of workers?

MS. JORDAN: Well, my experience when I was in Texas, and I was running a large insurance company, was that there are lot of small businesses that wanted to provide health benefits to their workers but because of this cost shifting issue, many of them couldn't get insurance, and then what they got was very expensive, with high deductibles, et cetera. So if we have a situation in which small employers are in a pool which is part of the proposal as I understand it will come out, that will allow them to have the leverage and a large enough group of them, they should be able to negotiate among good providers costs that they can afford. I listened to the presentation about the Hawaii system, and noted that the kind of costs that Dr. Lewin is talking about is half the costs of what we're providing here in the United States.

MR. MacNeil: Let me ask Mr. Motley, if the playing field is level Ms. Jordan says small businesses will be able to afford it, where they can't now because of cost shifting?

MR. MOTLEY: There's no doubt that if the playing field were leveled that more small businesses would provide health insurance. Two out of three of our members provide it today and two out of three of those who don't would like to do it. Their major problem is cost. But still for those employers who may be in areas of the country that are in recession, for those that are in areas that are in decline, small towns across the United States, they simply cannot afford two to four thousand dollars a year per employee. Most of the employees out there who don't have health insurance happen to be your lower wage employees and they are not working for very successful businesses, so you're going to have a natural job destruction which is going to occur. You know, we're arguing here in town right now about a stimulus bill. We're talking about a couple of hundred thousand jobs that in the next five weeks we're going to announce a health care plan which most of the estimators believe that is going to destroy somewhere in the neighborhood of 3/4 million jobs in the first year.

MR. MacNeil: Mr. Patricelli, you also worry about job loss if there isn't a subsidy for small businesses. But Ms. Jordan says if you get the playing field level and stop cost shifting for uninsured people that the price will be low enough you won't need those subsidies.

MR. PATRICELLI: I wish the facts bore that out, but there is no, no likelihood that average premiums even in big community rated pools for small businesses are, are going to go much below this three thousand or thirty-five hundred dollar level for a family, and many small businesses will not be able to afford that.

MR. MacNeil: Ms. Jordan.

MS. JORDAN: Well, I don't have the exact figures of what the estimates are. I can tell you that part of it has to do with reforming the delivery system. There's no doubt about it, and I will continue to say that cost shifting is not cost containment. And I know it is very difficult for small businesses and particularly large businesses who have large pools of part-time employees that frequently turn over to handle this. And I think it is going to be tricky in terms of what comes out in the reform package to find a way to have an equitable way of paying for this and may require some type of government subsidy to it. But I will still argue that we've got to have everybody in it. We already have had the experience of not having everybody in it, and we've seen what it has done to us.

MR. MacNeil: Mr. Motley, what were your -- what does your association want instead of a mandate?

MR. MOTLEY: Well, first of all, let's say that we agree that everybody should be in the system. The biggest cost shifter in this system is not small business or the workers of small business to larger businesses or businesses that have insurance. The biggest cost shifter is the federal government who keeps on putting more and more requirements into Medicare and Medicaid and is unwilling to pay for it. I mean, that's where the cuts that are being suggested are going to come from.

MR. MacNeil: They've been lowering the compensation rate on their Medicaid and Medicare procedures.

MR. MOTLEY: They absolutely have, and they spend almost one out of every two dollars in this country today on health care. So if you're looking to end cost shift, I think you should probably look at the federal government first. If you're looking for universal coverage, we're simply saying it shouldn't be placed upon the backs of the employers of this country. That's non- productive. That's going to hurt this country in the future.

MR. MacNeil: Well, who should, whose back should it be placed on?

MR. MOTLEY: Well, employers, we believe, should be allowed to continue to subsidize health insurance as a fringe benefit, but individuals should have the responsibility for obtaining an insurance themselves. If they can't afford it, then government should step in and help them through the tax code.

MR. MacNeil: Mr. Moehrle, you just don't agree with that?

MR. MOEHRLE: No, I don't.

MR. MacNeil: Why?

MR. MOEHRLE: I hear all this discussion about cost shifting. One of the reasons we can have cost shifting is because with somebody else you can always shift the cost too. You have a single payer system, there's nobody to shift it to. You're it. Okay. There's no way of getting around that. In addition, you have to get to the point where you realize that this is a public good, and that's the way we need to pay for it is through the government. Okay. We're in business, and it's an anathema for us to suggest that government can or will do anything correctly. But the fact of the matter is that this happens to be one of those things that they have to do. What we in business have to do is to respond by saying, listen, government, this is your job, we're going to insist that you do well and we want a place at the table so that we can give you our ideas on how to make it work well. And that's what we've got to work on. I listened at this table and with all due respect to those who have spoken already. My concern is if we continue with the current system we have, there's really nothing more than trying to make road worthy an Edsel to perform in the year 2000. The fact of the matter is our biggest problem right now is the fear confronting both the insurance companies and the doctors. And those in business sooner or later are going to have to buck up and face that.

MR. MacNeil: You've told us, Mr. Patricelli, earlier that the Chamber's view is that if you don't have employer mandates the only viablealternative is the one payer system that Mr. Moehrle describes.

MR. PATRICELLI: If you're going to face up to universal coverage and to end this business of cost shifting that's been properly pointed out, you've got to have a credible way to get there. Now where we take exception with Mr. Moehrle is honestly we don't think the answer to the nation's health care problems is to turn it into a government-financed system. That hasn't worked in any others.

MR. MacNeil: To your knowledge, is that even seriously being considered now by the Clinton task force, or has that been ruled out? Or do you know?

MR. PATRICELLI: We don't believe that anything's been fully ruled out at this point, but there is a large bloc on Capitol Hill that likes the idea of the government-financed system, and we think really that would be a tragedy because it would mean that people's health care would get caught up every year in of the politics of the federal budget and whether or not we'll have tax increases and how big the defense budget should be, and we don't think that health care ought to, ought to become a matter of federal budget policy.

MR. MacNeil: Ms. Jordan, what do you think about Mr. Moehrle's argument for the one payer system?

MS. JORDAN: Well, I don't think that there's a serious attempt to do that in this country. I don't think it's politically feasible, that would be my guess, now that we would have a government running our system, and even if we were to have that system where people would, where employers would be taxed and employees would be taxed, I would also submit that employers like ourselves at Edison would be very concerned about what we would be purchasing under that system. I don't see us abdicating our responsibility to the government in terms of what health care benefits are offered to our employees and/or the providers.

MR. MacNeil: Okay. Well, Ms. Jordan and gentlemen, thank you all for joining us. Jim. ESSAY - ALL IN THE FAMILY

MR. LEHRER: Now essayist Richard Rodriguez of the Pacific News Service talks about the other women in the nanny gate story.

RICHARD RODRIGUEZ: Zoe Baird, President Clinton's first choice to become attorney general, has long been gone from the pages of our newspaper. But something she said in the Senate chamber stays with me. It wasn't the dirt cheap salary she paid the Latin American couple to care for her house and her children, it wasn't her failure to provide for their Social Security, it was something else.

ZOE BAIRD: Quite honestly, I was acting at that time really more as a mother than as someone who would be sitting here, designated to be attorney general.

MR. RODRIGUEZ: It has taken the Zoe Baird controversy for us to notice something that has been going on in America for decades. Americans have been giving the key to the house to Latin American women, many of whom speak little English, many with Indian faces, women often here illegally, but now at the center of our intimate lives. Here in California, the state with the largest Hispanic population, you can see Latinos on suburban streets are on elegant city streets leading their blond charges, picking them up from school, taking them shopping, watching over them on the playgrounds, "baby city," the Latinos call it. The irony is, of course, that in California, as elsewhere in this country, Hispanics have long been criticized as people who were too family-oriented. You can hear the same complaint made about Asian immigrants, particularly the Chinese. But Asians are seen by many in California as being at an advantage precisely because they save and they work as a family unit. Republicans last summer at their convention in Houston went on about what they called "family values." The truth is that this country has never been a country of family values. We trust as Americans the story of the boy, Huck Finn, who runs away from home. We trust individualism, not the clutch of children on parents. Most Mexican-Americans in the United States live within two or three hours of Mexico. They had been loathe to give up the language of mother, reluctant to change like other immigrants, reluctant to stray far from home. Nothing has been more unsettling to the United States of America. And yet, there is the testimony of Zoe Baird. In thousands perhaps millions of houses today in the United States, Latin American women have been assigned the job of watching over the house now that mother and father have gone off to work or to play. Maybe Zoe Baird was right. Maybe it wasn't just a question of cheap wages. Maybe American parents have decided that the house is best maintained by the Latino. As long ago as the 1960s you could find in American book shops titles like these two: the Home Maid Spanish Cookbook and Home Maid Spanish. What do you say to the woman who last month was living in a Central American village? Here in Home Maid Spanish there is a list of everyday expressions. The list begins with buenos dias, good morning. The list ends with la siento, I am sorry.

WOMAN: Now the dryer is really easy. Again, you press the start lever here --

MR. RODRIGUEZ: In the wonderful movie of several seasons ago, El Norte, there were scenes of irony as cultures, languages, centuries collided in the kitchen. A Beverly Hills matron trying to explain American technology to the South American cleaning woman.

WOMAN: Okay.

SECOND WOMAN: [speaking through interpreter] Do you understand how this works?

THIRD WOMAN: [speaking through interpreter] Sure -- anyway, we'll figure it out. The important thing is, whatever they say, just smile and say yes.

MR. RODRIGUEZ: She has become a stock character in movies these days. You see her in scenes of cocktail parties, or movies about the foibles of Belaire.

ACTRESS: [scene in movie] Great! You can have garbage for dinner tonight too!

MR. RODRIGUEZ: The Latino, if only she spoke better English like Thelma Ritter, could probably get her own sitcom. But such is the irony she sees at $3 an hour. The American family is fragmenting in front of her. Meanwhile, President Clinton and Mexican President Salinas De Gortari discussed the free trade agreement between North American neighbors. Pat Buchanan says we need a trench or a wall or some kind of barrier to protect us from Mexicans. Americans speak of the flood of immigrants coming up from Latin America. Ross Perot speaks of Mexico sucking jobs from the United States down the drain. The U.S. Border Patrol guards the line as night falls.

[WOMAN SINGING TO SMALL CHILD]

MR. RODRIGUEZ: But all the while, the Latino has invaded the most private corner of American society, in the American house, from San Diego to suburban Washington, D.C., Latin American women are cooking, blond children are being raised in Spanish. The other day I met a tow-headed six-year-old in Marin County who told me with utmost seriousness that his name is Chico. Latin America is renaming the children of America. Children in large houses are being sung to in Spanish. This is what they will remember as their sweetest childhood dream. I'm Richard Rodriguez. RECAP

MR. MacNeil: Again, the major stories of this Thursday, President Clinton sent his formal 1994 budget to Congress. The $1 1/2 trillion budget includes plans to reduce the federal deficit by $500 billion over the next five years. The world court ordered the Serb-led republic of Yugoslavia to stop what it called crimes of genocide against Muslims in Bosnia. NATO agreed to begin enforcing the no-fly zone over Bosnia next Monday. FINALLY - VOICE OF CHANGE

MR. MacNeil: Finally tonight, a farewell to Marian Anderson, the brilliant contralto whom the conductor Arturo Tuscanini once praised as the greatest singer alive. She'll be remembered not only as a great artist but also as a heroine of civil rights. Her famous 1939 Easter Sunday concert at the Lincoln Memorial epitomized her long struggle against racial injustice. The Daughters of the American Revolution had refused her the use of Constitution Hall in Washington, claiming it was already booked. But Eleanor Roosevelt saw that as discrimination and arranged the Lincoln Memorial Concert instead.

[MARIAN ANDERSON SINGING]

MR. MacNeil: In a 1991 interview for a PBS documentary, Ms. Anderson spoke modestly of her achievements.

MS. ANDERSON: I wasn't a person and not to this day a real great fighter for anything. There are people who will if they want something, they fight, fight, fight, they don't mind, with their feet, with their hands, and everything, and those people are very, very necessary. But there are some who hope that if they're doing something worthwhile that it will speak for them.

[MARIAN ANDERSON SINGING]

MS. ANDERSON: There was something about the "Ave Maria" that meant so much to so many different people. It had its own message for me which transcended other things, or my program or in my mind, or whatever. And you get this from people who heard the concert, who heard the "Ave Maria," and you'd have felt with them that there's something special about it. RECAP

MR. MacNeil: Marian Anderson. Good night, Jim.

MR. LEHRER: Good night, Robin. We'll see you tomorrow night with Gergen & Shields, among other things. I'm Jim Lehrer. Thank you and good night.