The NewsHour with Jim Lehrer

GWEN IFILL: Good evening. I'm Gwen Ifill. Jim Lehrer is off. On the NewsHour tonight, our summary of the news. The newly minted Medicare law: We debate the pros and the cons. Vladimir Putin's team wins big in Russia: We'll have a report, plus analysis. From Iowa, a campaign snapshot of Democratic presidential candidate Richard Gephardt and a report on a new kind of fiction known as hip hop literature.

NEWS SUMMARY

GWEN IFILL: President Bush signed a new Medicare bill into law today, the most extensive changes to the health care program since its inception. The new plan will cost an estimated $400 billion over ten years. It covers some of the cost of prescription drugs for seniors beginning in 2006, and there's a larger role for private health insurers. The president said the law means better choices for the elderly, but some lawmakers say it costs too much and threatens Medicare's future. We'll have more on all this in just a moment. Republicans in the House pushed through a huge spending bill today, worth $373 billion. If it wins Senate approval, it will fund 11 cabinet-level agencies for the fiscal year that began October 1. Some Republicans complained it was too expensive, while Democrats said it shortchanged education and other needs. But the chairman of the House Appropriations Committee defended the measure.

REP. C.W. "BILL" YOUNG: Anybody who wants to find something at fault, something to complain about in this bill, they can do it because it's seven bills. You've got to find something there you don't like. But I will tell you that it is the best product that we could provide when you consider the fact that we were negotiating with the Republicans and Democrats in the House, negotiating with the Senate Republicans and Democrats, negotiating with the leadership and negotiating with the White House.

GWEN IFILL: Democratic leaders complained the entire process was skewed to make sure the president got his way.

REP. STENY HOYER: The congressional branch does not work, Mr. Speaker, for the executive. And I would urge the majority party, my friends on the other side, to let the executive department know that this is a democracy. It is not a kingdom, it is not a dictatorship. And just because the House passes something and the Senate passes something and they don't like it, that doesn't mean that the Congress of the United States ought to turn tail and run.

GWEN IFILL: The spending bill now goes to the Senate for a vote later this month or in January. Also today, the House gave final approval to a bill that cracks down on unwanted e-mail, known as spam. The measure asks the Federal Trade Commission to set up a registry for people who don't want to receive spam. The Associated Press reported today that former Vice President Al Gore will endorse Howard Dean for the democratic presidential nomination. The report cited a Democratic source close to Gore. It said he will endorse Dean during a joint appearance tomorrow in New York City's Harlem. Supporters of Russian President Vladimir Putin won big in parliamentary elections on Sunday. Putin allies, members of the United Russia Party, took 37 percent of the vote. That was more than three times the support garnered by the communists, who came in second. Putin hailed the results. But the international observers complained that state money and media helped the winners. A top official of the Organization for Security and Cooperation in Europe spoke today in Moscow.

BRUCE GEORGE: Whilst the duma elections were, in our view, professionally organized and took place in a generally calm manner, nevertheless, these elections failed to meet many OSCE commitments and commitments of the council of Europe and failed to meet other international standards for genuine democratic elections.

GWEN IFILL: In Washington, a White House spokesman said the U.S. shares those concerns about the fairness of the campaign. We'll have more on this later in the program. U.S. forces in northern Iraq closed off parts of Mosul today. They searched vehicles and pedestrians, hunting for suspects. An American soldier died in a roadside bombing there yesterday, and another U.S. soldier was gunned down today. And in Samarra, U.S. troops seized nearly $2 million in cash in a raid on Sunday. The U.S. Military opened a new ground offensive in Afghanistan today, the largest since the war two years ago; 2,000 troops moved into southern and eastern regions to root out Taliban and al-Qaida fighters. On Saturday, a U.S. air strike mistakenly killed nine Afghan children. Today, local officials warned the incident could undermine support for American efforts. Security forces in Saudi Arabia killed one of the country's most wanted terror suspects today. The interior ministry said Ibrahim Mohammed Abdullah al-Rayes was shot dead in a gun battle at his hideout in Riyadh. He was among 26 fugitives named on a most-wanted list made public Saturday. Officials said all are connected to recent suicide bombings. On Wall Street today, the Dow Jones Industrial Average gained more than 102 points to close at 9965. The NASDAQ rose 11 points to close above 1948. That's it for the News Summary tonight. Now it's on to Medicare changes; Russia votes; a campaign snapshot; and hip-hop lit.

FOCUS - MEDICARE CHANGES

GWEN IFILL: A look at the new Medicare benefit that became law today and what it means for seniors. Ray Suarez begins with the day's events and reaction in the Capitol.

RAY SUAREZ: The president's traveling entourage this morning stretched almost the entire distance from the White House to Washington's Constitution Hall, three blocks away. And the hall was packed, too, with public officials ready to watch the most significant change in the 38-year history of Medicare.

SPOKESMAN: The president of the United States! ( Cheers and applause )

RAY SUAREZ: President Bush was welcomed on stage by selected representatives of several senior citizens, and health care groups, and by two dozen or so members of Congress.

PRESIDENT GEORGE W. BUSH: This legislation is the achievement of members in both political parties. And this legislation is a victory for all of America's seniors. ( Applause )

RAY SUAREZ: Although only two congressional Democrats joined the delegation on stage, the Medicare bill did receive bipartisan support in congress. But there also was almost as much bipartisan opposition. The legislation slipped through both the House and the Senate last month with only a handful of votes to spare.

PRESIDENT GEORGE W. BUSH: With the Medicare act of 2003, our government is finally bringing prescription drug coverage to the seniors of America. With this law, we're giving older Americans better choices and more control over their healthcare so they can receive the modern medical care they deserve. (Applause )

RAY SUAREZ: The new drug benefit in the bill is voluntary and begins in 2006. It would cover 75 percent of annual drug costs up to $2,250. The beneficiary would pay all drug costs between $2,250 and $5,100. But above that level, 95 percent of drug costs would be covered. Seniors initially would pay $420 a year in premiums for the drug benefit, plus a $250 deductible. Nearly all those costs would be waived for beneficiaries with incomes under $12,100 and assets of no more than $6,000.

PRESIDENT GEORGE W. BUSH: It's a good thing that Medicare pays when seniors get sick. Now you see we're taking this a step further. Medicare will pay for the prescription drugs so that fewer seniors will get sick in the first place. ( Applause )

RAY SUAREZ: The House and Senate leaders who maneuvered the Medicare bill through Congress crowded behind President Bush as he signed the new legislation into law. ( Applause ) Hours later, a dozen of the Democrats who tried to defeat the Medicare bill staged a rally of their own, also packing the room with senior citizens. Among their complaints is that a provision in the new bill, which will allow private plans to compete with Medicare, is the beginning of a Republican attempt to dismantle the system. Massachusetts Senator Edward Kennedy:

SEN. EDWARD KENNEDY: If we had had a successful private system, we'd never need Medicare. Every senior understands that. Everyone understands that.

RAY SUAREZ: House Minority Leader Nancy Pelosi:

REP. NANCY PELOSI: America's seniors deserve a better bill. This Republican hope is a bitter pill. You deserve a defined prescription drug benefit under Medicare. We won't stop fighting until you get it. Thank you all very much for being here. ( Applause )

RAY SUAREZ: Democrats say they'll push to repeal the Medicare provisions signed into law today when Congress convenes for the 2004 session.

RAY SUAREZ: Some reaction now from two consumer groups who saw this new bill and its drug benefit differently. David Certner is the director of federal affairs for AARP, representing more than 35 million people who are age 50 and older. And Ron Pollack is the executive director of Families USA, a health care advocacy group that represents seniors, among others. David Certner, are people, your members, start to go get a handle on what's in this bill? And what kind of feedback are they giving ought the AARP?

DAVID CERTNER: I think the biggest feedback we're getting so far is people don't have a handle on the details of this bill. This is a complex bill, almost 700 pages long, a lot of information here. And more importantly, there's been a lot of misinformation and rhetoric out there. So it's very hard for people to understand exactly what's in the bill and we're going to be spending a lot of time over the next weeks, months and probably a couple of years trying to talk about the details of this bill. What we do know is that, when people do find out more about the bill, they are more comfortable with what's in the bill.

RAY SUAREZ: Ron Pollack, what are you hearing?

RON POLLACK: Well, I've been speaking to senior gatherings all across the country throughout this legislative process. And there are two reactions I get: The first time when you describe this very bizarre and sparse benefit that people get, people look at you very bewildered. They just don't understand it. And the more you explain it to people, then they start getting angry because they feel the benefit really is very poor, and what bothers them enormously is that the prices of prescription drugs are going to continue to skyrocket. When they learn that, not only was there no reasonable effort made to contain costs, but rather, there was actually a prohibition in the legislation that prohibits the Medicare program from bargaining on behalf of seniors to get prices down, that bothers seniors. When they learn that they can't go to Canada where prices of drugs are a fraction of the price of what they are here in the United States, that bothers seniors. When seniors learn there is this huge gap that you portrayed in the opening, that after $2,250 in annual drug expenses, up to $5,100 in drug expenses, they have to lay out all of this money out of pocket -- they've never heard of something like this. Now, the president said during his speech, "we should be providing to seniors what members of Congress get and what the federal employees get." This is a far cry from this. So seniors actually are very disappointed. The groups we've talked to have really expressed some anger.

RAY SUAREZ: Well, David Certner, somebody's on the phone who just says something like what Ron Pollack just said. How do you answer?

DAVID CERTNER: I think what you have to understand is that this bill is only half a loaf in essence. This bill only goes so far. There are some strange subsidy gaps in this bill, big coverage gaps because there is not enough funding allocated for the bill. This bill will help millions of people. This bill will also not help many millions of other people because there's just not enough funding in the bill. And Ron is right when he talks about a issues at price controls and holding down drug costs. This bill goes very light in that direction, but this is not an issue that's going away in this country. This bill was about covering people. We're going to be right back at it, talking about trying to hold down the high cost of drugs.

RAY SUAREZ: Well, break it down a little bit. Who are some of the people who really get something out of it, the way it's written now? And who are some others who might not be happy with what's in there?

DAVID CERTNER: Well, as shown by some of your earlier information, the biggest winners I think under this bill are the basically one-third of individuals who are at 150 percent of the poverty level or below. Those her-income folks who are below about 18,000 for a couple, $14,000 for a single, for them, they're going to have pretty good coverage. There is no gap in coverage, as Ron described, which is for many other people, not for the low-income. And they will have limited amount of co-pay and in many cases have their premiums and deductibles waved. So they're the big winners under this bill. The other big winners are those who have very high drug costs. There's a $3,600 out-of-pocket cost, catastrophic cap at which point the government picks up 95 percent of your cost. So if you have very high drug costs, you're going to be a winner under this bill. The third group is those who have no coverage today because this bill, for the first time, will provide in Medicare good prescription drug coverage for you that you can't get anywhere else.

RAY SUAREZ: And Ron Pollack, on the other side of that win-loss equation?

RON POLLACK: Well, let's take some of the groups David mentioned because there are some real problems for some of these groups. First, let's start with the low-income. As David knows, this is a group that we care a great deal about and work very hard on behalf of. David's right in saying that those people who qualify for this low-income benefit, they get something pretty good. They'll pay essentially $2 per genetic prescription, $5 for brand name prescription. But there are two things you need to know about this: First, there is a very large number of senior citizens who get disqualified from getting this benefit even though they are very poor. They have assets, as you indicated in the opener, of more than $6,000. They may have a life insurance policy, they may have a little money set aside for burial expenses or household items. They're going to be disqualified from this. They won't get this benefit. There's another group, and this is the poorest of the poor. These are people who are below poverty. They have income below $9,000 a year, and they're currently in the Medicaid program. Today, they get prescription drug coverage. Under this bill, they're going to be worse off for two reasons: One, is they're going to have to pay more money to get their drugs, and they're not going to have the same drugs available to them under this program because there's going to be a limited so-called formulary. So the poorest of the poor are actually a good number of them, are going to be hurt. Now, there's another group David mentioned that also deserves serious consideration. These are the people who have very high drug expenses. Now, David is correct in saying that, if you have over $5,100 in drug expenses, you'll get this so-called catastrophic benefit where you only have to pay 5 percent of the costs. But before you do, that you have to pay $3,600 out of your own pocket in co-payments and in deductibles over and above a $420 premium. You have to pay more than $4,000. Many of these people will never get to this catastrophic benefit because they can't afford it.

RAY SUAREZ: Do we know how many of the current recipients we're talking about when we talk about that category?

DAVID CERTNER: Well, there's the category the asset test that Ron mentioned, and we think the asset test was a bad idea. It should not have been part of this bill. And that will probably disqualify somewhere between 10 and 15 percent of the low-income people who otherwise would have been eligible for the really good coverage for low-income folks. That's a problem. On the top end, I think we're talking close to 10 percent of people who actually have costs above the out-of-pocket cap.

RON POLLACK: It's important... David's numbers I think are roughly the same as our numbers would show. But the people who fall in this gap, they call it here euphemistically a donut hole -- it's really a coverage chasm. There's a lot of people. There are about one-third of America's seniors have drug expenses that take them into this gap, where they get no coverage at all. But there's a very important thing to keep in mind, as well and that is all of these out-of-pocket costs that seniors are required to pay under this, those costs are going to grow over time. And because there isn't any serious cost containment as David and I were explaining before, those costs are going to grow very substantially. And so instead of paying $4,020, $420 in a premium, $3600 in other out-of-pocket costs to get this catastrophic benefit, ten years from now you're going to have to pay $7,100 in order to get this catastrophic benefit because the drug costs are just going to sky rocket.

RAY SUAREZ: And David Certner, will more people end up in that valley as well who maybe didn't expect to be there in the coming years because drug costs are going to be....

DAVID CERTNER: Well, you're going to have people paying higher prices if we don't get a handle on drug cost. This bill does a little bit on drug costs, particularly trying to encourage genetics to the marketplace, which are generally cheaper than the brand name drugs. But for the most part, this bill dodges most of the real issues on cost containment. We're going to have to go back and deal with those issues like reimportation from Canada. We hear that all the time. Why are prices lower in Canada than what I can get here? And we're going to have to address those issues. And the coverage gap is a problem. We explored amendments earlier in the year to try to close that coverage gap; it's a big problem for people who are not low-income, who are looking to see if they can get a good deal out of this benefit and they're going to find that if they fall in that gap, their deal is not going to be nearly as good as it should be.

RAY SUAREZ: Well, earlier Ron discussed the formulary, that is the list of approved drugs. Are there a lot of people that are taking drugs that they might right now assumed are going to be approved for them who will end up paying out of pocket and it won't even count toward their deductible?

DAVID CERTNER: Well, I don't think we know the answer to that because we don't even have these plans coming forward yet and we don't even know what's going to be on their formulary lists, so we're not sure. I think it's probably a good guess that many people will not be able to get drugs that they currently get now under a Medicare formulary that they might be able to get under a more expansive regime now. We really don't know the answer to that yet. Many of these issues we're to not going to find out ever been until the next two years as we roll out what these plans are actually going to look like.

RAY SUAREZ: Ron Pollack, you've discussed the gaps between rich and poor seniors, those with high and low drug costs. Are there other split perceptions here between younger seniors and older ones, between those who are still on the verge of retirement and those who are already in the Medicare plan, as far as the way they perceive this thing?

RON POLLACK: Oh, I think so. You've got a whole group of people who have prescription drug coverage today, they get it through their employer in most instances, if you have drug coverage as a senior, it's a previous employer, it's a retiree benefit. And although there were some provisions made to try to encourage employers to continue providing coverage, about one quarter of the people who have coverage today from their employers are likely to lose it. That's what the Congressional Budget Office tells us. So there are a significant number of people who are very happy with the coverage they have. They're likely to lose it. Then there's a big difference in terms of healthy and younger seniors versus the older and sicker seniors. The private plans, the HMO's and other managed care plans, they like to cherry-pick. They like to get the youngest healthiest people. And the traditional Medicare program takes all-commerce, the oldest old and the sickest sick. We're going to see them increasingly divided up with the private plans trying to pick off the youngest healthiest people. In the process, I think over time, it will put the traditional Medicare program in jeopardy.

RAY SUAREZ: Let me get a quick response from David Certner.

DAVID CERTNER: I want to mention because I think Ron touched on one of the things we probably hear most about from our members is, those who currently have good coverage particularly coverage through a former employer, very nervous about losing that coverage. Of course what we've seen over the last decade is the fact that employers have been dropping their retiree health benefit coverage. We've seen almost a 50 percent reduction in the number of employers who are actually offering this coverage over time. So this is something that's been happening. One of our number one objectives in this bill was to make sure that there were substantial subsidies from the federal government to private employers to encourage them to continue to offer retiree health benefits. And that's in this bill. We have almost $88 billion worth of subsidies in the bill to employers to maintain their current coverage, and that was a huge priority for us. We want to make sure we can slow down the number of companies who are dropping this coverage.

RAY SUAREZ: David Certner, Ron Pollack, thank you both.

GWEN IFILL: Still to come on the NewsHour tonight, the Putin victory in Russia; Richard Gephardt in Iowa; and hip-hop literature.

FOCUS - BIG WINNER

GWEN IFILL: Elections and democracy in Russia. We begin our coverage with a report from Moscow by special correspondent Simon Marks.

SIMON MARKS: They counted the votes all night long and into the morning, from the Baltic to the Pacific, but within hours of the first results being published, it became clear that Vladimir Putin was on track for a massive victory. The Russian leader wasn't even on the ballot yesterday. Voting in Moscow, the president refused to say which party he was supporting... ( applause ) ...but everybody knew the president was voting for United Russia, a brand-new party in its first electoral outing. In a field of 23 competing parties, United Russia secured more than a third of the vote, its support spread nationwide and throughout Russia's socioeconomic divide. Turnout was 56 percent, slightly down from four years ago.

MAN ON STREET (Translated): I voted for United Russia because Russia is now getting up from its knees. It already has. And United Russia is a winner compared to all the other parties. I support Putin and United Russia because finally our country is winning some respect in the West and is becoming civilized.

SIMON MARKS: The other big winners, Russia's two nationalist parties, one of them already threatening to re- nationalize recently privatized industries, both of them expected to be loyal to President Putin.

( Speaking Russian )

SIMON MARKS: The results mean Vladimir Zhirinovsky, long considered a crypto fascist by western observers of Russian politics, will now be a central figure in the parliament, andmay be able to exert enormous influence over government policies. His party secured around 11 percent of the vote, and in Moscow today there was much speculation about what kind of bargain Mr. Zhirinovsky will seek to strike with the Kremlin in exchange for his support, support that could give President Putin the two- thirds majority he needs should he wish to change the constitution and serve more than two terms in office. The Kremlin used a tried and tested formula this past weekend: As in 1999, the winning party was hastily created by the government specifically to fight these elections; it wrapped itself in the flag, secured utterly favorable media coverage from Russia's television networks, all of which are now loyal to the Kremlin; its leaders spread unsubstantiated rumors in a bid to discredit their opponents; and its very name, United Russia, implies that everybody voting for it was acting in the national interest. And that left Russia's liberal reformers out in the cold. A dozen years after the fall of the Soviet Union, the country's two parties promising western- style democratic reform failed to meet the 5 percent threshold for parliamentary representation. It's an annihilation of historic proportions, caused partly by the country's bad memories of economic reform during the Yeltsin era, and partly by the government-inspired difficulties both parties faced getting their message out. It leaves familiar figures here, Grigori Yavlinksi, leader of the reformist Yabloka Party, and former finance minister Anatoly Chubais back at square one.

ANATOLY CHUBAIS ( Translated ): In this country there is no other political force that has the same experience with victories and defeats. We'll start to fight all over again. We've done it before. We know how to do it.

SIMON MARKS: Also facing a tough road ahead, the country's communists. Though they still won 12 percent of the vote and placed second, that's an historic low, and the party remains reliant on aging supporters. In the Kremlin today, President Putin described the election as another step toward democracy, but election monitors from the Organization for Security and Cooperation in Europe disagreed. Citing the Kremlin's strict control of the media, they said there was no level playing field on the campaign trail because state assets were used to promote United Russia. The elections, they said, were a step back. And with Russia's Democrats facing the tough task of starting over, their supporters find themselves increasingly worried that Vladimir Putin will now build on a record that includes jailing businessmen, charging academics with espionage, restricting the independent media, and discouraging dissent. Lev Ponimiriov was a dissident in the 1980s who worked with the late Andrei Sakharov and other legendary thorns in the Soviet Union's side.

LEV PONAMAREV ( Translated ): If Putin is elected president for a second term, he will simply continue his current policy. He will build a regime based around authoritarian rule. The people will support it more and more. Eventually, every boss in the country will have a sculpture or picture of Putin on his desk. They will sing songs about Putin, and the people who will try to fight all this will slowly become enemies. I have no doubts about it at all.

SIMON MARKS: There seems no doubt that the way is now clear for Vladimir Putin to coast to victory in presidential elections in just three months' time. Indeed, it's hard to identify any national figure capable of mounting a serious challenge. The communist party leader Gennady Zuganov is likely to run, and likely to go down to another defeat. As the winter snows envelope the Kremlin, Vladimir Putin can safely expect to occupy his office inside until at least the year 2008, and, should he wish to, possibly even beyond.

GWEN IFILL: Margaret Warner takes it from there.

MARGARET WARNER: For more on the elections and what they portend for Russia's future we turn to Toby Gati, a former assistant secretary of state and an NSC official in the Clinton administration. She now advises Russian and American business clients at a Washington law firm. And Anna Vassilieva, head of the Russian Studies Program at the Monterey Institute of International Studies. She is a Russian native and an American citizen. Welcome to you both. Toby Gati, what do these results tell you about the state of democracy in Russia today?

TOBY GATI: The results of these elections really are the culmination of several trends that we've seen in Russia; the suppression of a free press, the pressure on civic society, the use of government apparatus and of the apparatus of the police to keep opposition in check. And what we've seen is a system where the parties that are favored by the government do well and those that aren't don't do very well. And I think what it means is that we are now relying on the fate of Russia on one man, on Putin. If Putin takes Russia towards full authoritarianism, it'll go that way. If Putin becomes the defender of a semi-authoritarian state, well, it'll be that way. In any case, it is not the Russia certainly that I expected and many expected, and it's not a Russia based on the rule of law.

MARGARET WARNER: Anna Vassilieva, why do you think the people of Russia endorsed this party, United Russia, which didn't have much of a platform other than to wrap itself around Putin?

ANNA VASSILIEVA: Well, I believe that Russian citizens endorsed the party United Russia precisely because the party United Russia supports President Putin. And with the highest level of popularity that President Putin enjoys in Russia, people, citizens of the country just wanted a force, political force in the country that would fulfill the wishes of the president who is so popular.

MARGARET WARNER: But I mean what does he represent to them?

ANNA VASSILIEVA: President Putin, I believe, represents self-confidence and some faith in the possibility of restoring stability in the country. And I know that stability is not the word that is popular in the present-day discourse when we analyze Russian politics. But it's extremely important to remember that we had 2,600 percent inflation in the year 1992 after the reforms, liberal reforms were started by Yeltsin's government. We had the war in Chechnya, and we had another financial collapse in 1998. And all those revolutions affect the quality of life of Russian people so that right now, Russia represents a society with about 40 million people who live below the poverty line and about 30 million people who live just a little bit above the poverty line. And definitely those people want anything but more radical economic reforms. They want the society of order and stability. And President Putin seems to be offering that to them, at least in words.

MARGARET WARNER: So Toby Gati, you said this is a real open question. Where do you think Putin is going to take this mandate?

TOBY GATI: Well, it's not only an open question, it's a very important question. Putin was one of the first to recognize that Russia really had to turn towards the West to modernize. I think he shocked Russian society when he said conditions were so bad that it would take 20 years to reach the level of Portugal and its standard of living. And I think he does understand that openness towards the West is important. And many people in the West have been saying that Russia's path towards, if not greatness, at least normalcy, was to continue in openness. And of course it's our hope that Putin will continue to do that. But the real question for Russia is: Who is Vladimir Putin? And if we read the programs of some of the parties that are supported by him, of course there is no reason to believe that that openness can be continued. However, even business is going to be concerned, and if investment doesn't come in, I think Putin understands that this is not going to be the kind of Russia he wants to build. And that's going to be a constraint on how many controls you can put on currency, how much redistribution of property, the kinds of things that are being called for by the one party that gives me the most concern, and that's the motherland party of Dmitri Rogozin and Sergei Glazyev, who have really called for a return to the old policies.

MARGARET WARNER: This was another new party formed to try to peel off support - a very ultranationalist party.

Anna Vassilieva, if were you a businessman in Russia or if you were investing in Russia, Russian, what message would these results in the last few months send to you? How do you think the western business community will look on this?

ANNA VASSILIEVA: Well, it depends on what kind of a businesswoman I would be. It was made very clearly by motherland party and by Zhirinovsky's party is that their idea of reforms is to support in all possible ways the small business in Russia, to give a partial control to the middle sized business in Russia and to make sure that Russian government controls fully five most important strategic resources of Russia, which are oil, gas, electricity, railways and military industrial complex. So if I were a foreign businesswoman who would like to invest, I would make sure that, first of all, legislation, the current legislation in Russia takes into consideration the risks that I will have to take as a foreign investor who doesn't really know Russian business culture. If I'm a businesswoman in Russia, I would make sure that I pay all the taxes that I am obliged to pay by law, that I am socially oriented, that I make sure that my profits partially go to the people of Russia, rather than are taken away from the people of Russia and deposited in foreign accounts. And I would make sure that I can always have an open dialogue with the government because what we see in Russia now is a tendency for a more authoritarian style of politics and for any businessmen, this is something very important to consider.

MARGARET WARNER: How do you see this point, Toby Gabi, for instance, do you think that some of these big industries are going to be renationalized?

TOBY GATI: No, I don't think there'll be a re-nationalization of industry, and I don't even think that a lot of the private property will be touched. But private property will not be private property for the use of the owner of the private property. It's going to be private property in the interests of the state. So for example, you want to make a major investment, you have to make sure that the government believes that that's the kind of investment that should be made. Business likes stability. Business has been happy with the results of what President Putin has done. The growth rate in Russia has been over 6 percent. A lot of positive things, and I think President Putin will be aware that the initial analysis, for example, of some of the companies in Moscow is kind of concerned about where this is going and what it's going to mean for their investments.

MARGARET WARNER: What is the U.S. stake now in which direction Putin goes? And does President Bush or the Bush administration have really any influence on it?

TOBY GATI: Well, we have an enormous stake in what kind of Russia emerges -- a strong Russia, yes, but a strong Russia for what? And I really think it's about time for this administration to get a Russia policy, rather than a personal policy towards Russia -- to understand that, yes, one man matters, but what really matters are institutions. And I'm pleased to see the White House, for example, agree with the OSCE, that there were problems with the election. But we have to remember this is an administration that for three years has not said very much about internal developments and has been mainly concerned with Russia's support of terrorism, which has been good and support of the policy for Iraq, which has been good sometimes, others not. And I think Russia, along with other countries, like Azerbaijan and Uzbekistan have gotten the message that this is a one-theme administration. If you follow us in foreign policy, then we don't really care what you do inside Russia. I have always thought that what happened in Russia matters very much. When the Soviet Union was our enemy, it wasn't our enemy because it had nuclear weapons; it was our enemy because its internal system was inconsistent and opposed to our own. So what happens in Russia really does matter. And if somebody wants to do President Bush a favor, he should read him "Glazyev's Economic Policy, a Redistribution of Resources" and ask him to get a good night's sleep.

MARGARET WARNER: Anna Vassilieva, your view on this, on the U.S. stake, and what has the Bush administration received from here?

ANNA VASSILIEVA: I believe that the administration of the current president of the United States should take into consideration the reality on the ground in Russia. And understand that Russia has been through a major transition during the last ten, twelve years, that Russian democracy is very young and very fragile. And this is, again, the confirmation of it is something that this election shows to us. How many years did it take the United States to build democracy we're all enjoying now? Russians have been through tremendous revolutions. Russians are being challenged in all aspects of their everyday life. And if the administration of President Bush is putting too much pressure on Vladimir Putin, I don't know if that would cause positive result because President Putin has to deal with enormously difficult task of helping the people raise from their knees. And this is what one of the people who was interviewed by your correspondent said earlier in this program. He wants... the people want to raise from their knees. This is where they were thrown by the reforms -- no matter what kind of reforms, what names we are attaching to the reforms. So it's extremely important to be tactful about fragility of Russia and to do everything this administration can do to help stabilize Russia, help its economy, because demos is based on economy, civil society is based on demos and democracy cannot exist without economy, civil society and demos.

MARGARET WARNER: And by demos, you mean the body politic?

ANNA VASSILIEVA: By demos, I mean the civil society, the people who don't need to worry about what they're going to feed their children with or where are they going to find the money to buy just basic things, shoes, coats, and this is what Russian citizens are concerned by now.

MARGARET WARNER: Thank you, Anna Vassilieva and Toby Gati. We have to leave it there. Thank you both.

FOCUS - CAMPAIGN SNAPSHOT

GWEN IFILL: Next, another of our snapshots from the presidential campaign trail. Tonight we hear Missouri Democratic Congressman Dick Gephardt's remarks to voters in Waukee, Iowa.

REP. RICHARD GEPHARDT: My name is Dick Gephardt. I'm going to win the Democratic nomination, and I'm going to beat George Bush in November, 2004. ( Applause ) Let me, if I can, tell you why for a minute we need to replace this president -- as if you needed to know. He's leading us in all the wrong directions. Every area you want to look at, he's leading us in the wrong direction, not the right direction. The economy is a mess. Yeah, I know, they say, "oh, we had 7 percent growth last quarter. Everything's fine, everything's terrific." Well, you know, that's what economists say when they look at numbers. You ought to come out here to Iowa, Missouri, Pennsylvania, Michigan, Ohio, South Carolina, North Carolina, even California, and ask that question: Where is the 7 percent growth? Is it going to be sustained? Is it going to continue? And what about jobs? Where are the jobs? This president has lost 3.3 million jobs since he's been president. That's more jobs than the last 11 presidents put together lost. They don't get it. They think the way to make the economy work is to give more money to people at the top, they'll spend the money and that'll make the economy work better. Well, it doesn't work. Just think about it for a minute. If you give somebody who's really wealthy more money, they're not going to spend it. Give it to people that will spend the money. One of the best things we did in the Clinton administration is raise the minimum wage. Why did that help? Because people who are at the minimum wage spend it instantaneously. The money courses through the economy and the pie gets bigger for everybody. We're the builders, we're the growers, we're the people that know how to make the economy better for everybody. Everything that I talk about in this campaign is designed to create jobs, to get this economy moving again. I have three goals for my presidency: Jobs, jobs, jobs. And everything I'm talking about here will create jobs. All my competitors in this race are now coming around saying, "I'd never be for a NAFTA that doesn't have enforcement of labor and environment in it." Well, check the record. They were for it. I not only talk the talk, I walk the walk. When I fought against NAFTA, I was taking on my own president. I was majority leader. I was his right-hand person. But I don't back up when I think something is wrong. And I thought that was wrong, and I will always fight for what I think is right. We need to stop the human exploitation that's going on in this world. I've been in the villages. The people live on the ground. They live in cardboard boxes that bring the products back to the United States. They live in worse condition than most farm animals do in Iowa. This is nothing short of human exploitation for the profit of some big corporations. When I'm president, we're going to bring it to an end. We're going to have a trade policy that's good for everybody. ( Applause ) And finally, finally, I will have a foreign policy. I told George Bush in the Oval Office on 9/12, we got to trust one another. I told him early in the last year, I said, "if you want to deal with Iraq, you got to go to the U.N., you got to go to NATO, you got to get us the help that we need." I said, "we're not going to need their help going in. We're going to need their help coming out." He went to the U.N. and said, "we're going to do this with or without you. Have a nice day." Is that a way to get people to help you? This is not complicated, folks. It is not complicated. You know how you have to deal with members of your own family, you know how you have to deal with colleagues and friends in the community, you know how you have to deal with people that you work with. You have to deal with people with respect, and you have to listen as well as talk. And you have to collaborate and you have to work with people and cooperate and get things done. That's the kind of president I will be. In the end, my philosophy of life is a little bit different than W.'s, and I guess I'll leave with you that. I think we're all tied together. I think Bush thinks we're all separate, isolated individuals. If you make it, great. If you don't make it, it doesn't matter, according to him. It's called survival of the fittest. And my problem with it is that I don't think it works and I don't think it's moral. My own life is a good example. I grew up poor. My dad was a Teamster and a milk truck driver. It's the best job he ever had. We had no money. I got a great education because I got church scholarships, government loans. I'm the example of the American dream. I'm running... I've been leader in the House for 13 years. I'm running for president of the United States of America.

GROUP: Bravo! ( Applause )

REP. RICHARD GEPHARDT: I didn't do it on my own. No way. I wouldn't be here today without all that help. There aren't many of us that don't need some help to fulfill our God-given potential. And I just want to leave you with this: When I'm president, every day, on every issue, I'm going to be trying to figure out how every person in this country fulfills their God-given potential. Nobody left out. Nobody left behind. We can make America a better place, a better place than it's ever been if we bring everybody forward together. Thank you very much. ( Applause )

GWEN IFILL: We'll show you similar campaign snapshots of other presidential candidates in the days and weeks ahead.

FOCUS - HIP HOP LIT

GWEN IFILL: Finally, tonight, Spencer Michels looks at a new, but increasingly popular brand of streetwise fiction. It's known as hip-hop literature.

SPENCER MICHELS: Mornings at 5:00, Renay Jackson takes up his floor polisher and his cleaning rags and performs his job as a custodian at the police department in Oakland, California. But in his head, a novel is taking shape.

RENAY JACKSON: To me it's like drama, and my books are a running soap opera in my ear. So by the time I get home, I kind of know what's going to happen today.

SPENCER MICHELS: "Oaktown Devil" was the first of Jackson's four novels, which together have sold about 35,000 copies. He writes in an increasingly popular style called by various names like "hip-hop" or "gangsta," using the raw, often sexually-explicit language heard on the streets. African-American bookstores report books like this are becoming increasingly popular. The genre usually depicts a violent, drug-filled life in ghettos across America, including Oakland, where Jackson grew up.

RENAY JACKSON: It's coming on similar to what rap music did. Somebody is going to jump on this bandwagon and make a lot of money.

SPENCER MICHELS: Jackson hasn't gotten rich yet, but he is supplementing his custodian salary by selling his fast- moving stories of the drug life.

RENAY JACKSON: In this neighborhood, just like the majority of neighborhoods I describe in my books, you have, like, killings, you know, drug dealings-- look at that-- you know, just like the everyday life of, like, you know, the urban streets.

SPENCER MICHELS: Did you live like this or have you?

RENAY JACKSON: I grew up in poverty- infested neighborhoods, yes.

RENAY JACKSON: Barbara!

WOMAN: Hey, hey, hey. What you got for me?

RENAY JACKSON: "Oaktown Devil" because I know you're out.

SPENCER MICHELS: Jackson delivers some, though not all, of his books personally. They are self-published, meaning he pays to have them printed. They sell for $13 each, but after paying book stores, a distributor, and the printer, he ends up with less than three dollars a book. From all indications, his audience includes young black males who don't normally read novels. At a World of Books near Oakland, Jackson's work is nearly as popular as "Harry Potter."

WOMAN: We're way over 100 a month easily.

SPENCER MICHELS: Jackson's books can be hard to find. Many major bookstores don't carry much hip-hop literature, though a few titles, like Sister Souljah's "The Coldest Winter Ever," have been published by big companies and are on the shelves at major chains. The number of books is growing. This African-American bookstore carries two dozen current titles, which sell quickly. And so some publishing houses are getting interested. Richard Grossinger, founder of North Atlantic Books, a medium sized publisher in Berkeley, believes Jackson's work could take off.

RICHARD GROSSINGER, Book Publisher: When I got the books, I thought that they were actually pretty wonderful. They were good stories, they were funny, they had great dialogue in them, and they had a quality of authenticity that you just couldn't fake. I would say it would be disappointing to sell less than 50,000 of each of the books. And they could well sell up in to the hundreds of thousands.

SPENCER MICHELS: Grossinger would like to publish Jackson's work and other gangsta literature, something the bigger houses have mostly avoided.

RICHARD GROSSINGER: Because most publishing companies are corporate bureaucracies, somebody's going to say "who are we going to offend by this?" Or "what is this going to do to our self image?"

SPENCER MICHELS: A single father with a degree from a community college, Jackson began writing at age 40 after one of his three daughters asked for help describing her summer for a school assignment.

RENAY JACKSON: So I typed up on the computer, "it's a hot summer day, at least 95 degrees, so hot you could see waves in front of your eyes," and, you know, described myself washing a car. She bounced on away, and after she left, I just kind of continued writing, you know? It was like, "okay, I'm going to do a short story."

SPENCER MICHELS: From the beginning, his books were based on real happenings in Oakland, a town with a very high murder rate. Using vernacular laced with obscenities, Jackson's "Oaktown Devil" is a novel about Rainbow, a black city worker who is attempting to find the killer of his brother, who was murdered over drugs. Many of Jackson's characters are drawn from the streets, including Rainbow's sexy girlfriend, Cassandra, and ex- con Buckey Jones.

RENAY JACKSON: "Buckey Jones was a fool in every sense of the word. Even his closest friends on occasion could not escape his fury. You wouldn't want him going out with your daughter either. A known fact throughout the hood was that if you wanted something sinister done to someone, Buckey was the man."

SPENCER MICHELS: At Lucky's Barbershop in Oakland, where Jackson gets his haircut, barber Jarbarie Bell enjoys his books as fiction.

JARBARIE BELL: For the most part as African Americans, we all don't live this lifestyle, but there are some that do.

SPENCER MICHELS: It's not your world?

JARBARIE BELL: No, not my world at all.

SPENCER MICHELS: In fact, not everybody in the African American community is a fan. These unvarnished tales of violent men and their women have provoked debate on the value of gangsta literature. Marcus books operates several bay area book stores that feature the works of Toni Morrison and other black authors, and more recently, hip- hop writers like Jackson. Blanche Richardson is a manager.

BLANCHE RICHARDSON, Marcus Books: It's fiction written by, I would say, novice writers that deals with, and in many instances glamorizes, thug life, street life, gangsterism, even prison life.

SPENCER MICHELS: Why do you say it glamorizes it?

BLANCHE RICHARDSON: Because often in the books there's no socially redeeming value to them at all.

SPENCER MICHELS: Richardson praises ghetto fiction for attracting new readers; that's why she carries it. But she has problems with the way it is written.

BLANCHE RICHARDSON: I'm talking about misspelled words. Generally the works are unedited or poorly edited. Sentence structure is that of a middle school student. I would like to see these novice writers hone their craft.

RENAY JACKSON: I'm not trying to write like everything else you reading. You know? My characters... I have them talking the way if you go into the heart of the projects, black folks talk.

SPENCER MICHELS: Jackson asked his daughters if his writing was too crude.

RENAY JACKSON: "What about the sex? What about the violence?" And my oldest daughter, Patricia, man, she killed me, she was like: "Daddy, we can see that on cable every night."

SPENCER MICHELS: On the campus of San Francisco State University, in the nation's first black studies department, hip-hop literature got mostly high marks from the students.

STUDENT: It surprises people, because it's the real truth. And when it hits them, it's just so dynamic. It's like I never heard anything like this in my life.

STUDENT: His book actually gives a thug a three-dimensional life.

STUDENT: I think that writers should have some sort of moral opinions about how the characters are portrayed, and not glamorize or romanticize, like, just out and out violence.

DORTHY TSURUTA: I don't want us to discuss this book in terms of great literature.

SPENCER MICHELS: Black literature Professor Dorothy Tsuruta finds that Jackson's work is not devoid of morality.

DOROTHY TSURUTA: No, I don't think he's condoning violence at all. He wouldn't have all the bad guys get killed. He's not celebrating this. He's saying, "Folks, look at this. This is what we have come to."

SPENCER MICHELS: Tsuruta says Jackson's work isn't quite literature yet.

DOROTHY TSURUTA: He has the spark that could be honed and groomed to become a writer.

SPENCER MICHELS: Jackson says he wouldn't mind a publishing contract and a little professional grooming as long as it doesn't ruin his style. He has recently finished his fifth book, called "Crackhead," and is working on a sixth, hoping the hip-hop genre catches on big time.

RECAP

GWEN IFILL: Again, the major developments of the day: President Bush signed a new Medicare bill into law. And later today, a jury in South Dakota convicted Republican Congressman Bill Janklow of manslaughter for killing a motorcyclist in an auto accident. We'll see you online and again here tomorrow evening. I'm Gwen Ifill. Thank you and good night.