The MacNeil/Lehrer NewsHour

MR. LEHRER: Good evening. I'm Jim Lehrer in Washington.

MR. MacNeil: And I'm Robert MacNeil in New York. After tonight's News Summary, a preview of issues for tonight's State of the Union Address, the pollsters and analysts, a debate on health care reform, is there really a health care crisis, and then a report on welfare reform as tried in the state of Wisconsin. To close, Charlayne Hunter-Gault talks with an inner-city writer who is 15. NEWS SUMMARY

MR. LEHRER: President Clinton delivers his State of the Union Address tonight. He's expected to focus on health care and welfare reform as well as new approaches to fighting crime. Mr. Clinton spent much of the day working on the speech in the Oval Office. He will deliver it at 9 PM Eastern Time to a Joint Session of Congress which just returned today from a two-month recess. This afternoon, the Democratic and Republican Senate leaders talked about their expectations for the coming year.

SEN. GEORGE MITCHELL, Majority Leader: We have a lot of work to do. I expect this session to be a tough one. It's going to demand hard work, many hours, and a willingness to look beyond partisan advantage for solutions that will work best for all Americans, not the Democratic or Republican solutions but for solutions that work for all Americans. Our first session was very productive, family leave, national service, solid deficit reduction, motor voter legislation, the Brady Bill. I hope we will this year build on that success.

SEN. ROBERT DOLE, Minority Leader: We stand ready with our colleagues on the other side of the aisle, as we did on the North American Free Trade Agreement not only to cooperate but to vote and support the Majority Leader in every way we can. And we have fundamental differences. It's our obligation not just to oppose but to provide alternatives and some, try to work it out, try to help it out. But where we have a basic fundamental difference in principle, then we'll flatly oppose the efforts if you we think it's taking America in the wrong direction.

MR. LEHRER: We'll have more about the President's speech right after News Summary. Robin.

MR. MacNeil: Overnight rain added to the mystery of quake- stricken Los Angeles. Nearly a half inch fell between nightfall and dawn, causing soggy ground beneath the tent cities which house thousands of displaced people. The rain also knocked out electricity to 5,000 homes. In Washington, Budget Director Leon Panetta said the administration would ask Congress for $7 1/2 billion in federal aid. He said nearly 4 billion would be used to help those who were left homeless by the quake. He spoke at a White House briefing. NEWS SUMMARY

LEON PANETTA, Budget Director: We view this as an emergency situation by any definition of an emergency. The number of victims that have been impacted, the amount of damage that has impacted on that area clearly fits anyone's definition of what an emergency is, and what we would ask is that Congress and the American people approach this situation with the same sense of compassion and concern for fellow human beings that we've applied in other disasters was the same spirit that applied in the hurricane damage in South Florida as well as Hawaii and with regards to the Midwest floods.

MR. MacNeil: The quake assistance package is expected to be one of the first ones on the agenda for the new Congress.

MR. LEHRER: Energy Sec. Hazel O'Leary told a Senate committee today radiation tests involving humans were still being done, but she said none of the more than 200 experiments being conducted by her Department violated current ethical standards. O'Leary has released evidence of Cold War era testing by the government in which individuals were not told of the dangers they faced. In testimony before the Senate Government Affairs Committee, she said the present work was different and promised there would be full disclosure. She was questioned by the committee chairman, Sen. John Glenn, Democrat of Ohio.

SEN. JOHN GLENN, [D] Ohio: Has there been word put out through the agency or throughout government that any experiments that do not have informed consent, whether classified of or not, shall be stopped until reviewed?

HAZEL O'LEARY, Secretary of Energy: Yes. And I might add that the President will shortly be releasing his own presidential memorandum to each cabinet agency directing that will be done.

MR. LEHRER: O'Leary said a preliminary report on the government- wide review of Cold War era testing should be released in June. Singer Michael Jackson today reached an out-of-court settlement in a civil suit which accused him of sexually abusing eight teen-age boys. Lawyers for the boy and Jackson made the announcement in Los Angeles, saying the singer admitted no guilt but wanted to put the matter behind him. They would not discuss the financial terms of the settlement.

MR. MacNeil: The Russian government did today what its critics feared it might: It announced a program of massive new foreign subsidies. The plan was announced by Prime Minister Viktor Chernomyrdin. The Interfax News Agency said it would cost hundreds of millions of dollars over the next few years. Western observers have said such spending would fuel Russia's already high inflation. The U.S. Deputy Secretary of State-designate, Strobe Talbott, warned yesterday that higher inflation could bring a cutoff of western aid and bring down the government.

MR. LEHRER: Russia also called today for an urgent meeting of Security Council foreign ministers on Bosnia. Deputy Foreign Minister Vitaly Churkin said the meeting would be aimed at forcing the warring sides to reach a political settlement. The proposal appeared to be an alternative to the air strikes against Serb positions threatened by the NATO alliance. The United Nations has begun investigating reports of another massacre in Bosnia. U.N. observers today tried to reach a Central Bosnian village where Croat troops allegedly killed 25 Muslim villagers on Monday. Heavy fighting kept them from getting through.

MR. MacNeil: That's it for the News Summary tonight. Now it's on to a State of the Union preview, is there really a health care crisis, welfare reform in Wisconsin, and a conversation with a very young writer. FOCUS - CURTAIN RAISER

MR. LEHRER: First tonight is a pre-game look at the President's State of the Union Address. It comes from two political consultant pollsters, Democrat Peter Hart, Republican Linda Divall, and Eddie Williams, president of the Joint Center for Political & Economic Studies. Eddie Williams, how important is this speech for the President?

MR. WILLIAMS: It's very important for the President. He has an opportunity to set a tone for his administration, and, indeed, the nation for this year, and that could have enormous implications for his party and the elections in November. I think he has to set a strategic vision to deal with the issues that we've been told he's going to focus on, health care, crime, welfare, and continued economic well being. He's got to tie it in a bundle that's going to have an impact.

MR. LEHRER: Vision more than specifics, you think?

MR. WILLIAMS: Well, I don't think he's going to get into a lot of, lot of specifics. I think, you know, Mr. Bush had his problem with the vision thing. I think he's going to stay with vision and deal with some very broad areas and problem the details later.

MR. LEHRER: Yeah. Linda, what do you think he must do?

MS. DIVALL: There are two things that he must do that I'm not certain he can do.

MR. LEHRER: Okay.

MS. DIVALL: No. 1, he has to diminish this concern that people have about his trust and integrity that cuts across a number of fronts. One is the personal front as most recently represented by Whitewater, and secondly, is the whole concern that people have about whether they trust him on the issue of taxes and specifically things like the payment mechanism for his health care program. The second thing that he needs to resolve -- and I don't think he can do this in the speech -- but people still have some concerns about his ability to lead the country in an international crisis. That's probably not going to get addressed in the State of the Union. The thing that he does have to address is pretty much what Eddie said. He does have to describe his vision, and I think he does have to be specific. The problem that President Clinton has, as Congressman Gingrich said, there's a world between the difference between the details of his speech, or between the delivery of his speech and the actual details of his speech, and that canyon of difference, if you will, is a fundamental problem that people have in terms of what they want to believe about this President. He's got to inspire leadership and really within his own party, because when you look at the major battles over the last year, the problem has been not as much with the Republicans but on every major issue a key battle within his own party. If I were him, I'd pick a battle with this Congress and his party, as George Mitchell laid out, and say, for the good of the country, we need to stop these parties from bickering and get some things accomplished.

MR. LEHRER: Peter, what's your overview going in?

MR. HART: Not quite the same, Jim.

MR. LEHRER: Not quite.

MR. HART: Okay. I think the first thing is he has to be able to challenge about tomorrow. It's not a recitation of what they've accomplished in the first year but the ability to say here are the changes that the country needs to go through. The second thing, he can't forget what brought him here, and that is the economy. And he has to be able to talk about the economy because the numbers are better, people feel more reassured, but at the same time there is the sense of apprehension about downsizing and things that are going on. The third is the health care debate, clearly central to this administration, and it seems to me that one way or another he has to regain the momentum that he had in September. It's been lost but there'sthe chance of his speech to begin again. He finally, it seems to me, has to do what he does the best, and that is provide some sort of overarching theme, bring together crime, welfare, children, education into something that talks about the fabric of our society and where we go. If he does those four things I think he's on the right track and will do well.

MR. LEHRER: Eddie, what do you think of Linda's point that still he has to also speak to some basic apprehension about himself, he, Bill Clinton as a person, he, Bill Clinton as a President, above and beyond the details of his programs?

MR. WILLIAMS: Well, I think that issue, that worry is there. I don't know that he needs to spend his time in his State of the Union addressing that. I think the Republicans and his opponents will definitely bring it up whenever they have an opportunity to do so. This is his evening in the moonlight, so to speak, and I think he should take maximum advantage of it to present himself as he wants to be seen, to talk about his accomplishments but, again, not dwell on that.

MR. LEHRER: Who's -- there's always -- obviously there are two audiences for State of the Union, at least two. There's the, the people in the hall and then there's the people watching on television. Which is the most important tonight?

MR. WILLIAMS: They're both important. I think for him the audience watching on television, because that audience can help him move the audience that's in front of him tonight, i.e., members of Congress. They're concerned about crime. They're concerned about health care. They're concerned about welfare. They would like to see gridlock ended and for both ends of Pennsylvania Avenue to come to grips with those issues. There are questions out there. There are questions in the President's own party that he has to address on each one of those.

MR. LEHRER: You agree with Linda on that, that he's got his own problems --

MR. WILLIAMS: There are divisions that he has to heal.

MR. LEHRER: Yeah. Linda, what about, how do you feel about that? Is he in a position where if he wants action say on health care, let's say Peter's right, that this is it, this is the centerpiece of what he's got to get done this next year; in order to get that done some way he's got to talk to the American people and they will then get the folks in the hall tonight to do it?

MS. DIVALL: He absolutely has to talk to the American public and probably pull a page out of Ronald Reagan's book and the ability to do that. And frankly, Bill Clinton can do that. He can deliver a very passionate speech. The problem that he has on the health care issue is that people don't have enough details about this plan just yet. Every focus that we have done since the delivery of his speech, people fundamentally do not know how it's going to impact them, what it's going to cost them, what their ability of choice will still be. They are very concerned about this, so he's got to go right to the public, and as Peter said, he has really lost the momentum on this. An LA Times poll done earlier this week showed that 55 percent want changes phased in gradually now, only 40 percent think it should be, you know, implemented right away. So he has lost that ability to lead the country on this issue. Too much time has passed since the delivery of the speech, and it's been piecemeal to part. He needs to inspire the country again in terms of what his plan is and not look to be so ready to compromise. I don't know if that's possible.

MR. LEHRER: What about Peter's point, that he should try to find a way to tie altogether -- in other words, the theme that puts health care with crime and welfare reform, is that possible?

MS. DIVALL: Well, basically what we're talking about is the whole element of personal security. I mean, people are worried about crime in the streets. They're worried about the quality of education for their kids and making certain their kids don't have to worry about searches for drugs and knives in their lockers. 39 percent in a recent CBS poll have said that they have personally changed their behavior in some way due to their fear of crime. So if he can tie that in, and we do think it is possible and also allows him as a Democrat to continue to define himself as a new style Democrat, if he can speak to issues of personal responsibility, which frankly Democrats in the past have not gotten a deal of credit on.

MR. LEHRER: Peter, how does he do that and sound like a new Democrat and not like an old Democrat? In other words, you've got all these problems, Mr. and Ms. America, and I'm going to solve them for you, with the help of these folks in this room, we in Washington are going to solve these problems. Isn't that an old Democratic solution?

MR. HART: I don't think he gets caught in the old Democratic solution. I mean, one of the things that's so important is that he's changed the tone of the debate. I mean, for a Democrat to bring up welfare reform, that was something that Democrats should to steer away from.

MR. LEHRER: Run away from.

MR. HART: That's right. For a Democrat to bring up the crime bill and to push that, that was something Democrats used to steer away from. I think that the one thing he's done very well and the American public says so in our NBC-Wall Street Journal Poll, he is a different kind of Democrat, and I imagine we'll continue to see it.

MR. LEHRER: What kind of -- how would they define him?

MR. HART: I think that what they would see him as much more pragmatic, much more in terms of moderate versus progressive or liberal. I think they see him more in the middle, but can I pick up on your inside-outside point?

MR. LEHRER: Sure.

MR. HART: And that is on the area of health care, I think he has to do both. I think that he has to be able to talk to the American public as Linda said and give them the sense that here we go, this is what's involved, and these are the stakes. And the one thing the American public wants, and we see it in every poll, is universal coverage, and that's his strong point. The second thing he has to do is he has to be able to talk inside. He has to talk to the members within the hall, because, in essence, these people are the ones who are going to need the courage to be able to take a tough step. He was able to do it in 1992 with both NAFTA and with a tax bill, and in both of those instances, they took the tough medicine and they did the right thing and Congress came out ahead. He's going to have to be able to communicate again.

MR. LEHRER: Linda, does your polling bear out Peter's polling that, that more Americans see Bill Clinton as a different kind of Democrat, as a more moderate?

MS. DIVALL: Well, they do see him as a different style Democrat but to go back to a point that Peter made about that, yes, he's talking about welfare reform. Yes, he's talking about crime, but what people want and, indeed, one of the areas of objectives for the speech is that he has to actually show leadership. He hasn't presented a crime bill yet. He is still compromised by his own party on welfare reform, because there is a fundamental split in the Democratic Party on what to do with this issue. So he has got a very difficult problem here. He can't just talk about it. He has to take action.

MR. LEHRER: Yeah. But it's true, is it not, Eddie, I mean, this crime issue is full of a lot of good rhetoric, but it's tricky, isn't it, politically? A lot of people use it in code word terms. He's got to handle that in a very sensitive way, does he not?

MR. WILLIAMS: Well, it has to be handled sensitively, but, you know, last November, he went to Memphis, Tennessee, and spoke to an all black audience about crime and violence and personal responsibility and moral values and saying that we can work together with government but if we don't solve the problems from within there's nothing that government can do. That was almost tantamount to the Sister Souljah bit in taking it to that audience. Now, that was different. The average Democrat in the past would not have taken that gamble. And he got positive response there, and we've seen Jesse Jackson and John Jako of the Urban League also publicly calling for personal responsibility. Linda will say, well, where were they back then when Ronald Reagan and black Reaganites were saying the same thing? But the landscape has changed. The black electorate feels a sense of resonance with this President that they did not feel with either President Reagan or George Bush, and when -- they always interpreted their comments in this area to be law and order and, therefore, somehow to be anti-black.

MR. LEHRER: Sure. Would you think that not just black Americans but all Americans listening tonight to the President for something about crime and the personal security issue, that part of the personal security issue, what could they want to hear from a President of the United States? Would they want a specifics on crime bill? Would they want something similar to what was said in Memphis? What would -- do you believe they would want him to say?

MR. WILLIAMS: These people want to hear something in his words and in his vision that they can identify with. That was, that was the great beauty of Ronald Reagan in which he could spin a scenario that many people could bite into.

MR. LEHRER: You found yourself nodding.

MR. WILLIAMS: Yes. Our survey indicates that African-Americans place very high concern with respect to crime just as white Americans do.

MR. LEHRER: Sure.

MR. WILLIAMS: They don't shirk from that. And as a matter of fact, there is a very high proportion of those who are "lock 'em up and throw away the key" kind of people. The Congressional Black Caucus and others are very sensitive about crime bills, however. That seems to place overwhelming emphasis on brick and mortar jails and putting more cops in the street and less emphasis on preventive measures. I think that's the issue that some people want to look for.

MR. LEHRER: Linda, as a practical matter, what's history tell us about how important State of the Union message are in terms of recent Presidents?

MS. DIVALL: Well, they're important in terms of setting the legislative agenda, inspiring Congress to a call to action, and particularly with this presidency we've got Democrats controlling the President -- or controlling the presidency and Democrats controlling both Houses. The expectations immediately after '92 are quite high, and I think gridlock was supposedly broken.

MR. LEHRER: We're going to have parliamentary form of government here.

MS. DIVALL: Right. 72 percent have great expectations that Congress and the White House could work together and solve the problems facing the country. That has dropped to 39 percent. So he has got to rally his party, because people are beginning to become aware that Democrats control everything, and they are the only ones who can bring about fundamental change.

MR. LEHRER: So this speech could make a difference, Peter?

MR. HART: Oh, I think it makes a great difference, and I think that he'll do well because he, he tends to rise to the occasion on these, these forums.

MR. LEHRER: But can he get his fellow Democrats to rise to his occasion?

MR. HART: I think that he will throughout, throughout the season, because in the end it's the ability to get things done. I mean, if 1992 is about share your pain, 1994 is going to be about ease your pain, and for Democrats that means getting things done.

MR. LEHRER: All right. Peter, Linda, Eddie, thank you very much.

MR. MacNeil: Still ahead on the NewsHour, is there a health care crisis, welfare reform in Wisconsin, and an inner-city teen-ager who's an author. FOCUS - FALSE ALARM?

MR. MacNeil: It's health care eve again. Tonight, as we've heard, President Clinton is expected to push his health reform plan as the central element of the domestic agenda. Throughout the first year of his presidency, he called America's health care crisis his top priority. But as the 103rd Congress sharpens its pencils and prepares to get down to business, a number of prominent Republicans and even a few Democrats have said, "What health care crisis?" Chief among them is Senate Minority Leader Bob Dole.

SEN. ROBERT DOLE, Minority Leader: ["Face the Nation" - January 23] I think if you went home and you talked about health care, you learn it's a very important problem for a lot of people. It's not a crisis, as Sen. Moynihan says, it's not an American crisis. If you don't have it, it could be. And we ought to take a look at it, do the best we can, but not spend all year trying to shove something down our throat -- down the throats of the American people. It would just be a large overdose of government.

MR. MacNeil: Is there a health care crisis in America as President Clinton asserts? Strategist William Kristol has been urging Republicans to say no. Mr. Kristol, former aide to Vice President Dan Quayle, now heads the Project for the Republican Future. Strongly opposing that view is the former Democratic Governor of Ohio, Richard Celeste, who chairs the National Health Care Campaign of the Democratic National Committee. Mr. Kristol, the nation's been discussing a health care crisis for two years. Why are you now arguing suddenly that there isn't one?

MR. KRISTOL: Well, I think Americans common-sensically know that health care in this country is better than it was 30 years ago. We all know people, family members often, who are alive today who if they had contracted the same condition 30 years ago, the same disease, been in a similar sort of accident, wouldn't have survived 30 years ago. American health care is better than it's ever been, and it's better than health care elsewhere in the world. There are problems with our insurance system, but those problems could be fixed through reasonably simple, straightforward reforms. And the Clinton -- I think President Clinton has tried to create an atmosphere of crisis to justify this massive government takeover in the health care system.

MR. MacNeil: Mr. Celeste, he's tried to create an atmosphere of crisis?

MR. CELESTE: The President spent a year campaigning for the office and no issue was brought to him more forcefully and more personally than the health care issue over and over again everywhere he campaigned. The White House has received over a million letters from people who share a concern about this health care system which is very good for those who can afford it, very good for those who are working and have first dollar coverage but more and more lets people down, more and more drops people through holes in the health care safety net, that sees costs skyrocketing. And I don't think the President has had to stir up any sense of crisis in this country. It is real even among people who say they're satisfied with their own health coverage. The President wants a solution that's not a partisan solution. He wants a solution that can garner support from Republicans as well as Democrats, and I -- my own feeling is that it may suit Republican strategy to say there isn't a health care crisis, but for someone who commutes back to Columbus, Ohio, every week, I can tell you in Ohio, perhaps not in Washington, but in Ohio, there is a sense that substantial changes are needed to benefit everyone.

MR. MacNeil: Mr. Kristol, what's wrong -- since a lot of people say nothing gets done in this country unless people feel there is a crisis -- what's wrong with acting on the premise that there is a crisis?

MR. KRISTOL: Because one can make bad mistakes if one rushes into something and throws out an awfully good system because of a fear of crisis. Jimmy Carter thought there was an energy crisis in the late '70s, and there were problems, obviously, with our energy supply that we ended up with gas lines in 1979 and the syn fuels white elephant that we're still trying to, to get rid of to this day. In 1965, there was a war on poverty. There were poor people in this country, and the federal government should have done more to help them, but we rushed into a huge expansion of the welfare system and created the current welfare system that President Clinton now wants to reform. So I think it's irresponsible and dangerous to say this is a crisis, and, therefore, all the normal checks and balances are off, the normal critical judgment is off, pass this 1369 page bill as it is, and let's totally overhaul what is a very fine health care system.

MR. MacNeil: Mr. Celeste, how do you deal with Democrats who are saying the same thing that Mr. Kristol is saying or some version of that? For instance, Sen. Moynihan, a very influential Senator, chairman of the Finance Committee, who says we face a crisis in welfare but not in health care?

MR. CELESTE: I think that's the point, Robin. Sen. Moynihan was pointing out that there is a serious problem with welfare. He views it as a crisis, and I think the President would agree. My view is that Sen. Moynihan was talking relative terms, and I think it's the conviction of the President and many of us that you cannot solve the welfare crisis without addressing health care reform. It is ironic to suggest that the President is trying to push people forward hastily on this issue. It was debated in elections two years ago. It is something that has been proposed and discussed in Congress over a long period of time. And the President really wants Congress to play an active and engaged role in, in the debate from here on out to achieve a national consensus. The reality is, if you look at it in the context of welfare, when people divorce because they've had a premature baby, a 10 or 12 week premature baby, and lifetime limits in their insurance is going to mean they cannot get health care coverage for their child, so they get divorced so that she becomes eligible for Medicaid, we have a health care crisis and a welfare crisis. And that's precisely what's happening. If you look at why most people become first-time welfare recipients in families that have not receive welfare before, you will find that seven out of ten times, it is a health care crisis that puts them onto welfare.

MR. MacNeil: Mr. Kristol, I just put a point to Mr. Celeste, that people on his side are saying what you're saying. Well, let me put a point to you. Some people on your side, a big business coalition, a lot of Fortune 500 companies headed by former President Ford came out today saying there is a health care crisis and it's getting worse. Do you suggest that Republicans should be arguing against Gerald Ford?

MR. KRISTOL: Sure I do. Gerald Ford was wrong about some things while he was President. He's a fine man, but he's wrong about this. I think, Robin, the issue is a semantic one, whether there's a crisis or not.

MR. MacNeil: But you're making that the issue, aren't you?

MR. KRISTOL: Well --

MR. MacNeil: When you call it a crisis or not?

MR. KRISTOL: I mean, I'm happy to make it an issue because I think it is a fundamental misreading of the health system. Big business likes the Clinton plan, parts of big business, because the Clinton plan takes obligations big business currently has to employees and sloughs it onto the federal government. I don't think Republicans should follow big business by the nose. I think we should stand up for the interests of citizens who I believe will be hurt in the quality of their health care by the Clinton plan. And I think if you are going to talk about a health care crisis, I would like someone to argue that American citizens get worse health care today than they did twenty or forty years ago. Crime in America is worse today than it was 30 years ago. That's an objective fact. The welfare system, I believe, is worse than it was twenty-five or thirty years ago. The situation in our inner cities is worse. Health care isn't worse than it was 30 years ago. There are problems in the insurance system.

MR. CELESTE: Robin --

MR. KRISTOL: There are problems in the insurance system. Those should be fixed. Those can be fixed. I am for aggressively moving to fix those.

MR. CELESTE: That is not the case. The reality is we have an increasing number of people who have no insurance coverage, and we have data, increasing data that shows if you compare outcome here in the United States to any one of ten or twelve industrial companies that spend far less of their Gross Domestic Product on health care than we do, they have better outcomes in terms of infant mortality, in terms of life expectancy, in a variety of categories. And I think it is to stick our heads into the sand and say we don't have a crisis. Yes, for many Americans we are taken care of very well today. What about the people who work for NYNEX, which announced today that they will be getting rid of something in excess of 10,000 positions over the next year? What about the people who work for GTE, which made the same announcement last week? And the reality is that everyone is one job away from serious problems with their health care.

MR. MacNeil: What about that, Mr. Kristol?

MR. KRISTOL: Robin, for the people who work for NYNEX and GTE, is make insurance portable so they can take their insurance with them and let them deduct the cost from the taxes of their health insurance as their employer has deducted the cost of health insurance. Those two proposals are up on the Hill. They have bipartisan support. They could be passed tomorrow. It is the Clinton plan that is blocking sensible reforms that would address the real concerns of Americans, and by insisting on this massive, government-led overhaul of the whole health care system, Bill Clinton now stands in the way of real health care reform.

MR. CELESTE: That's not true.

MR. MacNeil: Mr. Celeste, what would be wrong with, as Mr. Kristol's just suggested, fixing some parts of the system, outlawing insurance discrimination, say capping malpractice awards, helping the uninsured pay for insurance, what would be wrong with doing it piece by piece like that?

MR. CELESTE: Nothing is wrong with improvements on the margin, but it doesn't deal with the fundamental problem. Today Americans who are working are concerned because they do not feel secure about their health care. Today there are Americans with good health care who don't go to the doctor because they're afraid of what it will do to the cost of their insurance next year. What the President wants to provide is a system in which we understand that our health care will always be there, and whether we work or don't work, whether we've just lost a job, whether we've just graduated from college, whether we've just gotten divorced, we can count on that coverage being there. That requires a profound change. In addition, he wants us to understand that we all are entitled to a basic, comprehensive package of benefits that begins with a focus on prevention, that turns around the attitude that people have about health care today, that we only use it as a last resort when we are most sick.

MR. MacNeil: Mr. Kristol, your memo which you wrote to the Republican Party suggesting this strategy of saying there is no crisis says that if the Clinton plan were passed it would be -- I'm paraphrasing here -- it would give the Democrats a huge political boost both in 1996 and beyond. How are people to avoid the conclusion from that memo and your strategy that you're more interested in the political gain-loss than you are in health care for Americans?

MR. KRISTOL: Well, I don't have any way to prove my sincerity. I honestly believe the Clinton plan would be genuinely disastrous to the quality of health care in America. There's a cover piece in the New Republic, a liberal magazine, that supported Bill Clinton strongly for President, that makes a devastating critique of the Clinton plan. There's no partisan emphasis there. Obviously, I'm interested in helping the Republican Party craft an agenda for the future, so I give political advice as well as substantive advice, and I do believe politically Republicans should not be embarrassed we think the Clinton plan is bad for the country. It's an attempt to expand government and as Dick Celeste sort of suggested, it sees people's security as being vested in the government. The way --

MR. CELESTE: That's not true.

MR. KRISTOL: -- we get people security is for the government to take care of them.

MR. CELESTE: Robin, I did not say that. And I want to be real clear about that. I believe one of the ironies is that the President's reform proposal would begin to change that. Indeed, Medicaid recipients who today are, in effect, living on the benefit of the government funding and go through a very complex process to determine whether they're eligible or not, they would be folded into a private system, and their insurance would be chosen among private plans. There is an effort to characterize the Clinton reform as big government but that is not what the President wants. That is not what he has in mind. And I believe he will reach out to Congress tonight to say, let's forge a plan that, that meets the needs of our people,that provides guaranteed coverage and comprehensive benefits, and does so in a way that simplifies the system and uses the private sector.

MR. MacNeil: Let me ask you a political question. Doesn't the fact that we're debating such a basic question as this tonight suggest that, as Peter Hart, the Democratic pollster just finished saying, the administration has, has lost command of this issue?

MR. CELESTE: Actually, I don't think so. I don't think that the issue that the President needs to address is whether or not there's health care crisis, because over and over and over again, the American people agree that fundamental change is needed. I think that the President does have to be clear about what he thinks are the critical ingredients of change, those ingredients that he's prepared to fight for, and where he welcomes debate and discussion and compromise in order to achieve a national solution. Otherwise, those who are willing to spend big money, like the health insurance industry and others, will, will shape the debate because it is their bread and butter that's going to be affected.

MR. MacNeil: Mr. Kristol, have you got a final comment?

MR. KRISTOL: Well, I think the President will try to regain momentum on health care tonight, but I think he has a tough problem. His bill has been out there now for a couple of months. People have looked closely at it, and they really do see that this bill will be damaging to the quality of American health care.

MR. MacNeil: All right. Well, gentlemen, thank you both. FOCUS - FAREWELL TO WELFARE?

MR. LEHRER: Next, another issue that promises to produce much heat this year, welfare reform. The President is expected to raise it in his speech tonight, but out in Wisconsin, the search for ways to overhaul the President's system has already begun. Art Hackett of Wisconsin Public Television reports.

MR. HACKETT: Wisconsin State Rep. Antonio Riley knows all about welfare. His family was on AFDC for a time while he was growing up. He has few good things to say about the welfare system.

ANTONIO RILEY, Democratic State Representative: I think it's a jailer of people. It's a trap for families. Once you're on, it's very hard to get off in that if you need welfare, you're guaranteed minimum in the private sector, you lose health care, whatever child care there is, you lose all that too.

MR. HACKETT: Many of his constituents are among the 40,000 Milwaukee County residents receiving AFDC.

ANTONIO RILEY: I mean, if this thing is working so well, why is it that the poverty rate among African-American and other minority children in Wisconsin is skyrocketing? Why is it we have such a growing -- in parts of my district, 25 percent unemployment -- I mean, this welfare system becomes nothing more than an excuse not to invest in the people, not to invest in our neighborhoods.

MR. HACKETT: Riley, a Democrat, was present in December when Republican Gov. Tommy Thompson signed a bill known as "Work Not Welfare." It may be the greatest effort in the state thus far to eliminate perceived problems with the welfare system. Work Not Welfare is a seven-year experiment which will begin in two yet unnamed counties next January. It requires new AFDC recipients to be in a training program within 30 days. They have to start working in some sort of a job after one year, with the state providing a wage supplement, health, and child care benefits. But Work Not Welfare would end cash benefits after two years. It would end all benefits after three years.

GOV. TOMMY THOMPSON, [R] Wisconsin: We're trying to makewelfare in Wisconsin more like the real world, so that if you get up in the morning and work, you're going to be able to get a paycheck at the end of the week or end of the month. And that's what Work Not Welfare is all about.

MR. HACKETT: Because it involves only two counties and about 1 percent of the state's welfare caseload, Work Not Welfare by itself probably wouldn't have attracted that much attention. However, an amendment tacked onto the bill by Democrats in the state assembly is sure to drive welfare debate in the coming months. That amendment abolishes welfare statewide effective January 1, 1999. Right now, no one knows what's going to happen to welfare recipients when that deadline hits. The Democrats already have an operating model for what they want to replace welfare; it's called The New Hope Project. New Hope in Milwaukee has been operating in a preliminary phase involving 50 people since 1992. When Lola Haynes joined New Hope, she was first assigned to clerical jobs with community organizations. She's now on New Hope's secretarial staff. Haynes says she realized almost immediately that work was better than welfare.

LOLA HAYNES, Former AFDC Recipient: You feel better about yourself. I feel that now I'm more of a positive role model for my children.

MR. HACKETT: New Hope agrees to provide some sort of job for all who enroll. It accepts the reality that welfare is often a better economic deal than many available jobs. Julie Kerksick helped design the New Hope experiment.

JULIE KERKSICK, Associate Director, New Hope Project: For a lot of people, the issues are not whether or not they can get a job at all but whether or not that job will pay them enough to even live on.

MR. HACKETT: New Hope is like an expanded earned income tax credit. A single parent with two children earning the minimum wage would receive a New Hope wage supplement of about $170 a month. If the parent's salary went up to $7 an hour, the subsidy would be $37 a month. Subsidies for New Hope participants like Sheila Staten are paid with the same money that would have paid her welfare check. Those subsidies can lift a family's income to as much as 150 percent of poverty when they taper off. Staten spent nine years on AFDC before joining New Hope. She now works as an inspector and scheduler for crews renovating this housing project. In the past, Staten says she was always able to find jobs but lost them due to problems with child care.

SHEILA STATEN, Former AFDC Recipient: Because I depended on my relatives and different friends, and some nights they wouldn't fill at this, they didn't want to do that, and I got stood up a lot, and therefore I was getting wrote up with working, you know, missing days.

SHARON SCHULZ, Executive Director, New Hope Project: Child care is very expensive and to be able to move into an entry level job and have the expectation of paying child care then someone says, no, this is not realistic for me.

MR. HACKETT: The big difference between the two welfare reform proposals is the time limit. Work Not Welfare would cut off all benefits after three years. The New Hope Project has no time limit.

JULIE KERKSICK: The eligibility for benefits depends upon one's income level, and the benefits are tapered off as your income rises, but if your income doesn't rise or if you -- if the job that you hold never offers health insurance, you'd still be eligible for support from the project.

MR. HACKETT: How would New Hope's participants react to a two- year time limit?

LOLA HAYNES: For people who really have no work history or need to GEDs or something, I think it's kind of a scary feeling to know that you only have two years, because that's uncertainty, and these are peoples lives that you're dealing with.

MR. HACKETT: If you were on AFDC, would you resent being pushed off at some point?

SHEILA STATEN: No, I wouldn't, because that's the only way certain -- you know, most people are. You have to actually hurt them or really just push them to do things.

MR. HACKETT: While New Hope requires participants to start work within eight weeks, the program also promises to pay the full salary if that's what it takes to create a position. Gov. Thompson, meanwhile, is reluctant to obligate the state to providing jobs.

GOV. TOMMY THOMPSON: Then you're just substituting one form of welfare for another. What you're doing is you're saying welfare as we know it is not going to work, but, on the other hand, we're going to create jobs, make work jobs. I think we can find them in the private sector, and I want to try that first.

LINDA RAY, Welfare Advocate: [talking to her child] When you're sick, you go to the nurse, and mama's got to take care of you when you're sick. That's mama's job.

MR. HACKETT: Linda Ray of Milwaukee is part of a group that is highly critical of both plans, saying both substitute jobs of dubious value for a more important job, raising children.

LINDA RAY, Welfare Advocate: So I don't think we should force any mother to work. I think that mothers know, and most mothers do make the decision whether it be when their children are three and ready to go into Head Start or when their children are five and ready to go into kindergarten, but I think that that's a judgment that should be left up to the mother.

MR. HACKETT: The group known as the Welfare Warriors has been going door to door in Milwaukee's housing projects. They're seeking signatures on petitions to U.S. Health & Human Services officials. The petitions oppose further federal waivers needed to implement programs like New Hope or Work Not Welfare.

LINDA RAY: [talking to woman on street] Did you hear about the Work Not Welfare? They're saying that a mom can get AFDC for two years, and after that, they cut it off.

MR. HACKETT: The Warriors feel welfare mothers are victims of a double standard. There's little controversy over Social Security survivors benefits that go to a child when a working parent dies. Welfare mothers are somehow suspect if they don't work, yet, survivors' benefits and AFDC were once in the same program.

LINDA RAY: There was no discerning between the children of the dead and disabled and the children of the abandoned. You just got your child support. Well, then they decided to branch it off into two, which made the deserving class and the undeserving, and yet you're basing it all on the behavior of the father.

MR. HACKETT: Ray argues that much of the waste in the welfare system is the bureaucracy needed to keep the undeserving out of the system.

LINDA RAY: For some reason, only if the father leaves you and doesn't pay his child support and then you're on AFDC, you're judged under the assumption that your children are liars, so, therefore, they have to pay all these people to police you.

GOV. TOMMY THOMPSON: And I don't want to criticize anybody on welfare. Anybody who's there has got a reason to be there. I want to help people help themselves get off of welfare.

MR. HACKETT: Rep. Riley, meanwhile, disputes that, arguing that most of Thompson's welfare reform proposals have been punitive in nature.

ANTONIO RILEY: It says that the recipient is the problem. We're saying no, wait a minute, the system is the problem. I think now we have focused the debate from the recipient onto the system, and when you focus on that system, we can work with those recipients conceivably to build a kind of system that we think is going to do better by people.

MR. HACKETT: The assembly Democrats plan on re-introducing their plan based on New Hope this spring. Thompson is now in the process of gathering experts to develop his. CONVERSATION

MR. MacNeil: Finally tonight, a conversation with a very talented high school student who is already a published author. Her name is Latoya Hunter, and Charlayne Hunter-Gault has her story.

MS. HUNTER-GAULT: When the story of urban America is told, it is usually done tabloid style, screaming headlines and blaring images, shootings, murders, mayhem, law breakers, victims. Rarely does this tableau of pathology ever yield a quiet voice, one from inside, a voice like Latoya Hunter's. When she immigrated from Jamaica West Indies at age eight, Latoya and her three older brothers and sisters lived with their parents in a small, walk-up apartment in a Bronx neighborhood that had long since fallen on hard times. both of Latoya's parents worked to keep the family from following the neighborhood. Latoya's coming of age story is a tale of that struggle and some of hers, especially at the tough junior high school where she was a student and where a caring English teacher encouraged her to write. By age 13, Latoya had been noticed by a publisher, and the result was The Diary of Latoya Hunter, a book that details her first year at Junior High School 80. By the time the book was published, Latoya and her family had moved from the Bronx to Mount Vernon, a suburb just outside of New York City. Today, Latoya is an 11th grade student at Mount Vernon High School and looking forward to attending college. We met recently to reminisce about her diary year and how her perceptions have changed.

MS. HUNTER-GAULT: Your story is a story of growing up in the Bronx. And I was struck by your description, because everybody, I suspect, has an image of what it's like in the Bronx, from the newspapers, from television, and so on. Let me hear what you have to say in your book about that part of New York.

LATOYA HUNTER: "As I said, I'm living in the Bronx, a place where walking alone at night is a major risk. The streets are so dirty, and there's graffiti anywhere. It really makes me feel down to walk around and see the things around you. The only colors I see are brown and gray, dull colors. Maybe there are other colors, but the dull ones are the ones I see. Maybe if the streets were cleaner and I would see colors like red and yellow, my surrounding would be more appealing, but for now, all I see is dullness and cloudiness. There aren't any pleasant smells coming from anywhere as I walk the neighborhood, just the smell of nothingness. There are a few stores very close to where I live. They are one of the few things that are familiar to me in this neighborhood."

MS. HUNTER-GAULT: So that's what the Bronx was like for you?

LATOYA HUNTER: Yes. It was. Umm, I felt it was that way for a lot of young people my age also. Umm, I just didn't feel there was anything much that was positive happening.

MS. HUNTER-GAULT: Mm-hmm. I was struck by another part of your description in the book about the environment. Read this little portion for me on that page.

LATOYA HUNTER: "Today gunshots echo in my head. They're the same gunshots that killed an innocent human being right across from my house last night. They're the same gunshots that have scarred me, I think forever. Late last night, I was in bed when I heard a man screaming for a police officer. I told myself I didn't hear that. Later I told myself I didn't hear the four gunshots that followed his cry for help. I lay there in bed, and it was like I was frozen. I didn't want to move an inch. I then heard hysterical crying, and I ran to the window when I couldn't keep myself back any longer. What I saw outside were cops arriving. I ran into my parents' room and woke them up. By that time, tears were pouring unstoppably from my eyes. I couldn't stop shaking. My parents looked through the window and got dressed. They rushed outside, and I followed them. It turned out that I knew the person who got shot. He worked at the store at the corner. He was always so nice to me. He was always smiling. He didn't know much English, but we still managed a friendship. I can't believe this happened. Things like this happen every day in New York, but not in my neighborhood, not to people I know."

MS. HUNTER-GAULT: But it was happening in your neighborhood, it was happening all the time?

LATOYA HUNTER: Yeah. Umm, it just didn't affect me so personally before. I would hear it on the news, hear stuff about people getting killed and things like that, but it never happened to me, like I would lose a friend because of the violence, so it really hurt me a lot.

MS. HUNTER-GAULT: Tell me a little bit about the aftermath of all of that.

LATOYA HUNTER: Ah, it just made me so much more aware that it could happen to me at any time also, just like that man didn't wake up in the morning and feel that I'm going to get killed tonight, so it made me more aware that anything could happen, and I was just really scared to even walk on the streets, because anything could happen.

MS. HUNTER-GAULT: You think the students who do experience this often, this kind of thing happening outside of their windows every night, do you see an effect of that in school?

LATOYA HUNTER: I feel in some cases it makes people achieve more.

MS. HUNTER-GAULT: Why?

LATOYA HUNTER: Because it pushes them to, to work harder to make themselves better.

MS. HUNTER-GAULT: So they can get out of the environment?

LATOYA HUNTER: Yeah, mm-hmm.

MS. HUNTER-GAULT: One of the things, one of the other things you talked about though were the teachers. You say that teachers didn't make you interested in learning. Tell me a little bit about the problems you faced with your teachers.

LATOYA HUNTER: Oh, my teachers, I always loved school. In elementary school, I was a very good student and part -- the reason for that was because I really loved learning. And when I went into junior high school, it was a whole different road. I don't know exactly, but the teachers weren't -- didn't seem to really care much about students.

MS. HUNTER-GAULT: Why do you think that was?

LATOYA HUNTER: I think after all the years they've had teaching, maybe they lost their love for it or something like that, but I don't think their attitudes should affect how they teach students.

MS. HUNTER-GAULT: And yet you had one teacher, in fact, it was the teacher who was the impetus for you writing this book, he was your English teacher.

LATOYA HUNTER: He was my fifth and sixth grade teacher. He -- he always believed in me, and he believed that I had a talent.

MS. HUNTER-GAULT: How was he different from the teachers you're describing.

LATOYA HUNTER: He pretty much was involved with our lives, and not only on a teacher-student kind of level. He, he was reallyinto our personal lives also. He made me feel that I was a good writer. He inspired me to write more. He would make us write compositions about things like racism, the Holocaust, things that you don't really think about that much, but he made us more aware of them. And, umm, that's when I knew that I loved writing, because of him.

MS. HUNTER-GAULT: When you talk about some of the problems that happened in your school, you said that the girls used to like to fight a lot, there was a lot of -- you talked about the violence. What do you think it was, aside from this one teacher, that allowed you to dream beyond those circumstances?

LATOYA HUNTER: I feel that it's -- it doesn't -- it all depends on the kind of home you're from too. If you have people at home supporting you and making you feel that -- making you believe in yourself, I think those things won't affect you as much as this. You're from a home where, you know, you have to, you have to give yourself your own self-esteem, but I feel it all depends on the home, and --

MS. HUNTER-GAULT: So what happens inside the home can be a good counter to what happens outside in the street?

LATOYA HUNTER: Yes, mm-hmm.

MS. HUNTER-GAULT: Since you wrote this book, you've come in contact with a lot of young people. What kinds of things -- you say that they are all treating you like an expert, right, like I'm -- but what kinds of things are kids saying, young people saying to you as a result of your book?

LATOYA HUNTER: Umm, well, whenever I go around to schools to talk to young people, they're just really inspired and they feel that they could it themselves also. So I make them believe in themselves more. To me, it's all about the fact that I was able to -- with all these limiting factors that I have as an individual like race, age, sex, I wa sable to achieve something like this, and you know, to be black and a woman in the '90s, you know, you know really all these opportunities coming to you. So I feel that's the thing I want kids to get out of, get out of this book.

MS. HUNTER-GAULT: And where do you see yourself going?

LATOYA HUNTER: Umm, I think I'd like to become a journalist in the future.

MS. HUNTER-GAULT: Why?

LATOYA HUNTER: Umm, I, I -- people say I have this gift for writing, you know, but I don't want to write fiction. I want to write about things happening in the world today, and you know, give my, my thoughts about them.

MS. HUNTER-GAULT: Well, Latoya Hunter, thank you.

LATOYA HUNTER: Thank you. RECAP

MR. LEHRER: Again, the major stories of this Tuesday, President Clinton prepared to deliver a State of the Union Address which is expected to focus on health care, welfare reform, and crime, and Budget Director Leon Panetta said the administration will ask Congress for $7.5 billion in federal aid to earthquake victims in Los Angeles. Good night, Robin.

MR. MacNeil: Good night, Jim. That's the NewsHour for now. Join us again later at 9 PM, Eastern Standard Time for full coverage and analysis of the President's State of the Union Address. I'm Robert MacNeil. Good night.