The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour. On the NewsHour this Labor Day evening full coverage of the tragedy of Diana, Princess of Wales, and a report and a debate about growth of part- time work in America. It all follows our summary of the news this holiday. NEWS SUMMARY

JIM LEHRER: Alcohol may have played a part in the death of Diana, Princess of Wales. Prosecutors said today the man driving the car was intoxicated at the time of Sunday's fatal auto crash in Paris. They said the driver's blood alcohol level was of a criminal nature. The Associated Press reported that level to be three times the legal limit under French law. Police said the wrecked car's speedometer was found stuck at 121 miles per hour, possibly indicating the auto's speed when it spun out of control in a tunnel. Princess Diana, her companion, Dodi Fayed, and the driver died in the accident. A bodyguard, also in the car, remains in serious condition but was expected to survive. We have more on the investigation in Paris from Paul Davies of Independent Television News.

PAUL DAVIES, ITN: In their first official announcement detectives investigating Saturday's fatal crash have said the driver of the limousine in which the Princess of Wales and Dodi Fayed were traveling had been drinking that night, the amount of alcohol in his blood well above the legal limit. The seven photographers detained near the scene of the crash were still being questioned today. The police will only say they're considering bringing charges against the seven, who include six Frenchmen and one photographer from Macedonia: This graffiti in the tunnel where the princess died an indication of the emotional backlash against the paparazzi. Some have already reached their verdict. But lawyers representing the seven say a different picture will emerge in time. The Ritz Hotel have confirmed that the driver, who was also killed in the crash, was not Dodi Fayed's regular chauffeur. The regular man had been driving a similar vehicle, which was being used as a decoy to fool photographers. Mercedes Benz have revealed that the limousine in which the princess and Dodi Fayed were being driven was partly armored. This precaution would have protected its occupants from an assailant with a pistol, but experts agree it would also have made the car more difficult to control as it entered the tunnel, negotiating a tight bend and a dip in the road at high speed. The lawyer representing one of the photographers claimed there'd been some banter outside the Ritz, with Dodi Fayed's driver or bodyguard telling the paparazzi they'd not be able to catch him. Another lawyer appealed for his client to be judged on facts, not emotion.

WILLIAM BOURDON, Defense Lawyer: There was an enormous public emotion, which is very understandable. But the answer to this very large emotion cannot be an unfair treatment, cannot be an excessive severity of the justice.

PAUL DAVIES: There's no dispute the photographers were pursing the Princess of Wales' car on Saturday night. The key questions still being asked are: How close were they at the time of the accident, did they cause the driver to lose control, or did the alcohol that he had taken reduce his ability to handle his vehicle? One person who could help the police investigation is Trevor Rees-Jones, Dodi Fayed's personal bodyguard. He is still in hospital, receiving treatment for head and lung injuries suffered in the accident. His condition is not life-threatening. Away from the debate on who, if anyone, was to blame, people have been queuing to sign a book of condolences opened at the British Embassy this morning. A union flag has been draped at the scene of the accident. Official ceremonies of remembrance will take place in Britain, but at the hospital where the princess lost her struggle for life, ordinary people continue to pay respect as best they can, with flowers and heartfelt messages.

JIM LEHRER: Diana's funeral will be Saturday at Westminster Abbey in London. A spokesman for Buckingham Palace made that announcement. He said 2,000 guests will be invited to the service, which will be televised. There will be a private burial at her family's estate, North of London. A White House spokesman said President Clinton will not attend the funeral. We'll have more on this story right after the News Summary. In this country on this Labor Day the federal minimum wage rose to $5.15 an hour, a 40-cent increase that was approved by Congress last summer. An estimated 10 million minimum wage workers will benefit, according to the Labor Department. Most television broadcasters also had some new rules as of today. They must now air at least three hours a week of educational programming for children under 16. The rules do not apply to cable networks. In Wisconsin, the traditional welfare system ended today. A new Wisconsin works law now requires all able-bodied adults to work or attend job training in exchange for welfare benefits. The law also puts a five-year cap on entitlements. President Clinton called the change one of the boldest, most revolutionary welfare reform plans in the country. Opponents protested in Milwaukee, declaring slavery starts September 1st. Overseas today Russian President Yeltsin said he will not seek a third term. He said so in a speech to children on the first day of school. Yeltsin is 66. He said he would retire after his second term ends in the year 2000. The Russian constitution bars a president from serving more than two terms, but Yeltsin's supporters had been reportedly looking for a way around that law if he wanted another term. In Bosnia today about 300 Serbs threw stones at U.S. soldiers. It was the second such attack in less than a week. Today's confrontation occurred when the soldiers took control of a television transmitter about 90 miles East of Banja Luka. A NATO spokesman said the troops acted to prevent Serb factions from fighting over control of the station and tried to disperse the crowd. There were no reports of injuries. And that's it for the News Summary tonight. Now it's on to the death of Diana, Princess of Wales, and the debate over part-time work in America. FOCUS - THE PEOPLE'S PRINCESS

JIM LEHRER: The story of Diana: the world in grief for an English princess. We begin with a report on funeral plans by Elinor Goodman of Independent Television News.

ELINOR GOODMAN, ITN: Inside St. James' Palace Prince Diana's coffin lay in the peace and privacy of the Chapel Royal, as all day, outside, the crowds of people waiting to pay their last respects built up. By tonight, the queue wound its way back to Trafalgar Square. Some came to leave flowers, others to sign the book of condolence. Some left long messages explaining why she'd been so important to them personally, others just a few valedictory words, all of them brought to St. James by a desire to show how much she'd affected their lives.

WOMAN ON STREET: We just didn't feel that we could carry on, enjoying the holiday without setting aside a moment to say how very sad we are.

ANOTHER WOMAN ON STREET: It's so complicated. It's so complicated. That's why I wanted to come up, for us to come up and see what was going on and see the fans. It's beginning to sink in, but it's not right. It's not right.

ELINOR GOODMAN: The question for the palace and the Spencer family was how to respond to this upsurge in public affection within the conventions of court etiquette. In her life, Princess Diana's position within the royal family was ambiguous, but as far as the public is concerned, there was no such ambiguity. She was a real princess, who deserved to be buried with full honors.

WOMAN: People would want to--people want to show their respect.

WOMAN: I don't see why she should be denied what the people want to give her, a last respect, if you like.

WOMAN: I think it should be a state funeral, so we can all participate.

ELINOR GOODMAN: What she will get is not a state funeral as such but a unique event, which the palace hopes avoids the traditional gradations of state funerals and allows a greater degree of public participation, both in the procession through London and the service, itself, at Westminster Abbey. In the words of Mr. Blair, it will be an occasion fit for a people's princess. Indeed, the formula seems to owe as much to the prime minister's mastery of the public mood as it does to the palace, combining, according to Downing Street, Princess Diana's modernity with dignity and ceremony. Her coffin will not lie in state to be inspected by the public. That is an honor genuinely accorded only to monarchs like George VI. But Princess Diana's coffin will be carried on a gun carriage, escorted by members of the regiments with which she had associations, the coffin covered by the royal standard, a sign that in death the royal family accepts her unambiguously as one of them. Behind, though, will come some of the ordinary people who she met through her charitable work, who will take the place of some of the great and the good, who traditionally come to such events as a right. But just as the Duke of Windsor was in death given full royal honors, despite the embarrassment he caused to the royal family through abdicating, so Princess Diana will get the full royal treatment.

HUGO VICKERS, Royal Biographer: Yes. It is--the royal family are treating her entirely as if she was still a member of the royal family, which is--which is not so unusual, because at the time of the divorce the queen did say there would be occasions when the princess would be included in royal events. Unfortunately, this is not one that she had in mind.

NEWSREEL NARRATOR: 9:45, Big Ben will strike the three quarters and then remain silent for the rest of the day.

ELINOR GOODMAN: The nearest occasion in terms of an outpouring of public grief was the funeral of Winston Churchill, but his funeral, preceded by lying in state in recognition of his position as a wartime leader, owed more to the Victorian age in which he was born than it did to the future.

ANTHONY HOWARD, The Times of London: Diana, Princess of Wales, is a quite different case. Here was someone whose eyes were not on the past but on the future. And I think that she would have wanted an element of informality. That may not be easy to bring off in Westminster Abbey, which is, after all, the shrine of kings. But I think they'll have a go. They'll try and do it, because she represented not the 19th century, not the 20th century, but the 21st century, in which she would, in the normal course of events, have spent most of her life.

JIM LEHRER: With us now are Letitia Baldrige, chief of staff for Jacqueline Kennedy and White House social secretary from 1961 to '63. She's the author of numerous books on etiquette; Michael Elliott, formerly with the British publication "The Economist," now editor of "Newsweek International" and "Newsweek's" other foreign editions; Elise O'Shaughnessy, executive editor of "Vanity Fair" Magazine; and two NewsHour regulars, Presidential Historian Doris Kearns Goodwin and Essayist Roger Rosenblatt. Roger, why has there been such an enormous reaction by the public and the press internationally to the death of this young woman?

ROGER ROSENBLATT: I think, Jim, it's because Diana represented beauty in the world and the feeling of loss is the loss of the presence of beauty and not just physical beauty, although she had that in abundance. But as the detection on the part of those who never knew here that this was a generous, good soul, quiet voice, kind eyes, disposition toward the suffering and those in distress, and the ill, for whom she worked, and all embodied in somebody who was just a joy to look at. So all the thoughts that people have about the many pictures of Princess Di and how many times she was photographed actually has a positive aspect of it, I think, because people want to see somebody so worth seeing.

JIM LEHRER: Somebody so worth seeing, Elise O'Shaughnessy? Your magazine, what, two months ago had her on the cover and several pictures inside. Is this a loss of beauty?

ELISE O'SHAUGHNESSY, Vanity Fair: Oh, Roger--something terribly important in her story--in fact, she is so beautiful that without our intending to, we ended up putting her the cover of the magazine a third time. The Mias Pestino photographs that were in our July issue and graced the cover of our July issue were intended for an inside spread to coincide with the Sotheby's charity auction. And when we saw them, we just thought these can't go inside; she is too beautiful; she's as beautiful as any movie star, but I think that the interesting thing about her and perhaps a deeper significance to a lot of people, and I've talked to a lot of women today about their reaction to her, was that she represented a modern version of the fairytale, which is all very well, you go and you marry the prince, but what happens when the prince turns out to be a louse, and it's a very 20thcentury story of someone who really took the reins and made a very difficult situation work for her in the end.

JIM LEHRER: Doris, how do you see--how do you read this enormous--a lot of people are being surprised by the way the world--not just the people in Britain, but the people in this country and all over the world have responded to her death. Are you surprised?

DORIS KEARNS GOODWIN, Presidential Historian: Oh, I must say I have been surprised too. I talked to a man the other night. He said that after he listened to the news that night he couldn't sleep all night. Now, here's a person who's never seen her. She had no impact on his life. It affected him physically the way mourning really affects you. And the only way I can understand it--but in some ways her life provided a story--as was just said, it started out as a fairytale, then we saw the underside of vulnerability, and then after the unseemly divorce she somehow was determined to rebuild her life. And that's when she began going to leper colonies, going to AIDS patients, touching them in a way that few people wouldn't. And I think it then ends violently, ends instantaneously, so this young person is always young. But the really interesting question is not just what she was but why do we respond that way? And I can only understand that the rise of celebrity is a 20th century phenomena, with the rise of mass media, newspapers, and with the move from the city--from the country, rather, to the city. People used to gossip around their neighborhoods in local bars, in local stores. They could really gossip about people they knew. We don't know these people, but this is the substitute in an anonymous world we live in--gossip about people we don't even know that somehow affects us, because it's in our living rooms every day. It's crazy at some level.

JIM LEHRER: David Halberstam was quoted today as saying that we live through celebrities now; we live our lives through celebrities, which is the point you're making--

DORIS KEARNS GOODWIN: Absolutely. And I don't know that it makes a lot of sense, but it's real, but I can't deny that it's happening out there.

JIM LEHRER: Michael Elliott, as a Briton--I read today that Princess Di--Princess Diana was considered the most famous woman in the world. Is that an accurate statement?

MICHAEL ELLIOTT, Newsweek: I think so probably. I was in London yesterday when the news broke. I was staying with a friend and woken up at 7:15. So I got some of the immediate reaction to her death in Britain. And although she was huge all over the world, she was beyond huge in Britain.

JIM LEHRER: Beyond huge. Explain what that means. What--

MICHAEL ELLIOTT: Her life in the public eye bracketed a period for about a decade and a half in which Britain changed more than most nations managed in a century or two. And I think Britain's watched her change with them. It's difficult to understand now how bleak Britain was and felt in the summer of 1981, when she married Prince Charles. That was a summer of race riots. It was a summer in which the economy was completely tanking, and here was this kind of fairytale wedding, with this teenager, effectively, I think actually she was just 20, this complete ingenue, from actually rather an uninteresting class--that is to say the landowning aristocracy. By the time she died on Sunday morning she had become what you might call the new Brits thought, epitomized themselves at their best, cosmopolitan, hating the country, but loving the city, absolutely at ease in different societies and in different settings, unhung up by people's sexual orientation, or ethnic background. And the reaction on Sunday morning, particularly from people under 35, was absolutely astonishing. I mean, it just took my breath away. And to an extent, it still does. And I think the secret is that they saw her grow and change as the country grew and changed. And they ended up loving her because she was, if you like, and this is a phrase that's been used about royalty before, but particularly opposite for her, she was a mirror to their better selves, or at least to the selves that they wanted to be.

JIM LEHRER: She really literally was leading the lives they wanted to lead.

MICHAEL ELLIOTT: Absolutely. And, of course, what she did--I mean, I thought the comment made by Doris Kearns Goodwin awhile ago about celebrity was absolutely right--what she did was give celebrity a twist. I mean, we know that Jackie Onassis was beautiful and coped with grief marvelously. And we know that Barbara Streisand is clever and so on and so forth. I can't think of another celebrity who touched the lives of so many in such a direct and such a compassionate way. I mean, the pictures that Elise has shown are extraordinary, you know, pictures are picking up babies with AIDS patients, what have you.

JIM LEHRER: Tish Baldrige, the Jacqueline Kennedy ONASSIS analogy--Michael just made that--and others have--is it a valid one?

LETITIA BALDRIGE, Former White House Social Secretary: Oh, I think it's very valid. Jackiewas our star, our movie star. The country needed one. We needed all that glamour and excitement. And Diana certainly brought it to Great Britain. But I think when that accident happened when she was killed, the shock of her--the way she went--you could almost hear the noise, the explosion, the impact. Then you started to think of her children, boys, the boys, motherless. And then you started to think of the monarchy, so stiff and so uptight, having lost this great jewel in its crown, this wonderful, warm, young woman, who was always making mistakes and going to shrinks and talking on the air about her love affairs and everything else, but she was so human in her foibles, and everybody loved her for that. The monarchy was shaken and made much warmer, and so I think she had a major impact on her own country, as well as the rest of the country. Mothers wanted their daughters to look like her. They all said, look at the way she walks, look at the way she sits with her knees properly together, and crossed at the ankle; look at the way she moves, listen to that beautiful, mellifluous voice. Everybody wanted her voice. So she was a star, a 19-year-old who got married and looked like a stuffed Raggedy Ann doll when she got married, and wore the worst clothes the first three years of her life, and then became a glamorous siren. Every woman wants to be that way. And all the men kept picking up her pictures and looking at them, whether they were 90 or seven years old. All the men, as well as the women, wanted to look at her pictures.

JIM LEHRER: So she became the woman who died in that tunnel the other day right before our very eyes, in other words?

LETITIA BALDRIGE: Yes. That was a shock.

JIM LEHRER: She did seem that way. She did not come to us that way, though.

LETITIA BALDRIGE: No. No. If she had died in a hospital, after a long, horrible disease, or something, it would have been much easier to take, but we'll always remember that accident in the tunnel. It's a moment of history, like John F. Kennedy's being shot, Martin Luther King. There are moments of history that we remember because of the terrible thing--the way a person lost his life.

JIM LEHRER: But, Roger, she was a most unusual celebrity. I mean, there is no--Jacqueline Kennedy ONASSIS, would you not agree with this first, Tish, that while they both were stars, they were very different kinds of stars?

LETITIA BALDRIGE: Oh, different backgrounds.

JIM LEHRER: Yes.

LETITIA BALDRIGE: Different purposes in life. Jackie was a woman who was raised in a family where they read a lot of books, and she had a marvelous education. She spoke many languages. She went on state visits with the President, sat next to the head of state in each country, and helped relay foreign policy. She was a working President in many ways.

JIM LEHRER: And contrasted with Diana--

LETITIA BALDRIGE: And Diana had a great time, except when she went over across the seas on her wonderful missions of mercy. And she loved children, and she had this wonderful compassion, but Jackie had a brilliance and intellectuality too. So you can't compare them.

JIM LEHRER: Can't compare them. But the celebrity--the idea that Diana was the ultimate celebrity, that she was a created celebrity, and that's what our culture now creates, and she was the No. 1.

ROGER ROSENBLATT: I think that she was an entirely different sort of creature than celebrity. And the observation that was made before that we live our lives through celebrity and, therefore, through her, I don't think applied to her at all. I think she was a natural. They come along once in a blue moon, a Fred Astaire who can dance, or a Michael Jordan who can jump, or an Ella Fitzgerald who can sing, and this woman could simply be. And when you see that, when you see--I don't know what it is--the example of nature perfecting itself, getting as good as it can look--then all you do is sort of sit back and gasp and watch and applaud. I don't remember anything very brilliant that Diana ever said. I don't remember anything extraordinarily witty that she said. There was certainly a super abundance of kindness in her, and we saw all that.

DORIS KEARNS GOODWIN: I'd like to jump in, if I can.

ROGER ROSENBLATT: But the main--the main thing that we saw was somebody who achieved stardom as if she was born to it. And when that happens--which is so rare--there is this kind of gasping, extraordinary, overwhelmed appreciation, and, therefore, the loss is palpable.

JIM LEHRER: Doris, do you buy that, that she was--what her number one strength was, that she was just there?

DORIS KEARNS GOODWIN: Well, I think it couldn't have been possible a century ago without pictures, without television. I mean, can you imagine if we were just reading about that wedding ceremony, if we were reading about her interviews that she gave on television? It was the aliveness that came through in the pictures, the beauty that came through in the pictures that we take to ourselves. And I think that diminishes the idea that this is some extraordinary person. I mean, I think she was a photogenic person in a photogenic age, in an age that clamors up the need for pictures. And those pictures entered our living rooms, our kitchens, and we lived with them. And then the picture of the car, so crushed, is such a sad ending to the beauty that we saw before that, but I don't know that it means it makes her one of a kind. I think she fit the spirit of our age right now, but I can think of a lot of people that will be very different in the future that will be celebrities in a far more substantial way.

JIM LEHRER: Elise O'Shaughnessy, what's your view of that, whether she was one of a kind?

ELISE O'SHAUGHNESSY: Well, I tend to agree with the theory that she was of an age, and one of the things- -it wasn't just that she was photogenic. She was also very self-revelatory. And that was something that not everybody admired her for. That very controversial interview in which she spilled her guts about everything and it was something where a lot of people felt that she should have kept it to herself, and where Mrs. Kennedy, Mrs. Onassis, would have certainly have kept it to herself, so I think that in a sense it was Diana's willingness to share everything with everybody that made her [a], the ideal subject of gossip and [b], the ideal celebrity for an age where everybody shares everything.

JIM LEHRER: Do you agree with that, Michael Elliott, in Britain, that everybody just--they wanted to know everything about her, and it was available to them, and that's what's made her what she was, or how--

MICHAEL ELLIOTT: I think Elise's comments are absolutely to the point. I think the interview that she gave in November 1995--

JIM LEHRER: That was a BBC interview.

MICHAEL ELLIOTT: The long BBC interview--was a great point in public perceptions of her partly because there was this extraordinary honest self-revelatory aspect to it, but the self-revelatory nature of it helped other people. I mean, one of my best friends is one of Europe's leading experts on postpartum depression. She was ecstatic after that interview. She was absolutelyecstatic that finally someone who women would listen to was going to talk about postpartum depression, bulimia, and everything else. So, I mean, although it was self- revelatory and we enjoyed the window into Princess Diana's soul, it also had--it also had a wider import. Of course, she was photogenic; of course, she wouldn't have been quite as famous, quite as notorious around the world, without television. But that's the way the world is now. It's not going to change. I mean, this is a visual world. We can't judge people by the standards that would have applied in the 19th century, when you would have seen line drawings in Punch or the Illustrated London News and report of their speech. I mean, you have to take the world as it is and you have to take celebrities in the world that they--that they live in. And what one saw here was an almost unique conjunction of person and times and a person growing through time, so that I think, as Doris said, there was a story to it, which ended with something that was both magical and tragic at the same time.

JIM LEHRER: And, Tish, you made that same point too, that this tragic death--the fact that she died young-- there are many people in history who died young--

LETITIA BALDRIGE: That's right.

JIM LEHRER: James Dean--Marilyn Monroe--John F. Kennedy--you mentioned him. Is this story of this princess going to be enhanced by the fact that she died young?

LETITIA BALDRIGE: Oh, I'm sure it will be. But, you know, as an observer of society and morals and the way our whole world is going, she was beautiful, she walked with beauty, and she had good manners. And when you look at all the grunge around us, you look at the way people dress today, we're going into the next millennium, looking like we've never been taught anything, and we were losing our manners. I think she was a wonderful voice from the past, even though she was young and she represented today, I think she helped young women perhaps think about that too.

JIM LEHRER: What about the point that celebrities now have to be more open, they have to talk about their inner thoughts--

LETITIA BALDRIGE: They don't have to, but some of them do, and it's forgiven, it's welcomed. Twenty years ago, thirty years ago, people wouldn't have bought that at all. They would have said she's crazy to do that, to spill all of her emotions on a press interview to call people and have special makeup where her eyes are darkened with dark circles. But today that's true. Psychiatry is with us and everybody is writing articles and telling about their parents having done this and that to them. It's--we're all making confessions all over the place, so she fit right into that. That's the new age, the new spirit.

JIM LEHRER: Roger, the other part of this story, of course, which is unresolved as we speak, and who knows when it'll ever be resolved, but the public has already made a decision here, particularly in Britain, I believe, that the press contributed to the death of their princess. Does that reaction surprise you?

ROGER ROSENBLATT: No, it doesn't surprise me, or you, I imagine. The terrible thing about these paparazzi in a tunnel is that you could not have a more graphic image of the animalistic aspect of press inquiry. Fortunately, most of us not only don't behave that way but wouldn't even consider that as journalism. But it becomes lumped into the same--onto the same bin for condemnation by a public that, on the one hand, is looking for some vent of its sorrow and the other some way to vent its anger.

JIM LEHRER: Yes. Do you agree with that, EliseO'Shaughnessy, that there's a double edge to this sword, somebody to blame but also some legitimate complaint?

ELISE O'SHAUGHNESSY: Yes. I think there is some legitimate complaint. I also think that as many people have pointed out, she did use the press and that was how she vanquished the palace and the forces of darkness that were keeping her down. So it does need to be said that she in a sense played a dangerous game. And that's not to excuse the behavior of the stalkarazzi, as they're now being called because that--it is shocking and everybody does feel that that is no way to behave for anyone who is engaged in the business of journalism. It is ironic, though, that she was such a mistress of playing the game of the media.

JIM LEHRER: Michael Elliott, do you agree with my statement awhile ago, that at least the British public has already brought in a verdict on this one?

MICHAEL ELLIOTT: Yes, I think they have, but I think the verdict will bound to be shaded over the next few days, Jim. I mean, we've already had the news today about the driver's--the fact that the driver had been drinking earlier in the night, which of course doesn't exculpate anyone but, I mean, it's just another factor that will be added in. There's going to be an awful lot of overheated debate. France actually has arguably the toughest privacy laws in Europe. I mean, if legislation was going to solve this problem, it would have solved it in France. And it plainly hasn't. I think there will be a degree of revulsion against the tactics of the paparazzi or some of them and some of the tabloids who employed them. But there is an apparently unsatiable demand for news and photographs of celebrities. That may dim. That demand may dim for a little while, but we live in an age, and here I think David Halberstam's comment is a posit--we live in an age where we enjoy learning about the innermost secrets of famous people, seeing them in private moments.

JIM LEHRER: And that's going to end, Doris?

DORIS KEARNS GOODWIN: Probably not, although I do think it's been building gradually and this could prove to be some sort of turning point and anger about unnecessary intrusions into the private lives of certain figures, and if the tabloid heads decide not to publish the pictures that somebody did get of Diana, that might seem a small turning point, even though the demand will still be there, there will still be paparazzi hoping to sell other photos, I doubt that those photos are going to see the light of day. I certainly hope not.

ELISE O'SHAUGHNESSY: They've already been published in Germany.

JIM LEHRER: In Germany.

DORIS KEARNS GOODWIN: Have they really?

JIM LEHRER: Yes.

DORIS KEARNS GOODWIN: Oh, good God! Well, that shows that it's insatiable.

JIM LEHRER: A newspaper in Germany today published on the front page a photograph of the death scene there, with the bodies in the car. That was your understanding too, Elise?

ELISE O'SHAUGHNESSY: Yes. Yes. Immediately. I mean, these people obviously didn't even think twice, and that is shocking.

JIM LEHRER: All right. Yes, Tish.

LETITIA BALDRIGE: I think all of this is going to help the coverage of the boys. I think the young princes will have some privacy. I don't think any of the paparazzi would dare step in and make them frightened and chase them and hound them. I think they're going to hold back on Diana's children, at least I hope to heavens they will.

JIM LEHRER: All right. Well, we have to leave it there. Thank you, all five, for being with us tonight. FOCUS - WORKING WITHOUT A NET

JIM LEHRER: Now, laboring in America this Labor Day. Tonight, many PBS stations will air "That's Why They Call It Work," a documentary look at the changing nature of work. One segment of that program focuses on part-time work and serves as a background for our discussion. The correspondent is Shelley Kofler.

ANNOUNCER: We've got a ten-minute delay from Fremont to all destinations. Once again, it is slow. It's backed up to highway 84 as you make your way down from the Sinoa exit

SHELLEY KOFLER, State of the Union: While Silicon Valley fights rush hour traffic, Donn Denman wakes to the kind of job most of us dream about. He seldom begins work before 10:00. His office is just a few steps from the breakfast table. This is where he did some of his best work for Apple Computer.

DONN DENMAN, Computer Programmer: While I was working for Apple, I had the luxury of making my own hours. And so I would take a day off and go hang gliding. Or I would take a week off and go to Mexico. And so, I was having a nice quality of life.

SHELLEY KOFLER: Donn's computer programming skills are in such great demand, he turns down offers for full-time jobs. He makes more money going from project to project, company to company. One of Donn's newest clients is PowerTV.

BOW ROGERS, CEO PowerTV: Let's pour some champagne.

SHELLEY KOFLER: This aggressive little company is celebrating three years of survival in the cut-throat working world of Silicon Valley. Silicon Valley and its companies have pioneered a new kind of workforce to compete.

BOW ROGERS: This is an example of PowerTV's-- one of our applications.

SHELLEY KOFLER: At PowerTV, for example, demand for its interactive television products is greater than the full-time staff can handle. That's where the Donn Denmans of the world come in. Unlike full-timers, they get paid only for hours worked: No insurance, no retirement, no vacation pay. And they can be sent home if business slows down.

BOW ROGERS: I see this continuing. I don't see the ability to grow your company to a huge size and keep that workforce fully employed with the ebbs and flows of technology.

SHELLEY KOFLER: In fact, one-fourth of Roger's staff works part-time, temporary, or on short-term contracts. They're part of what many call the contingent workforce. And most of them like their independence.

WENDY SPRAGUE, Contingent Worker: I have a four-year-old daughter, and I enjoy being home with her.

CHERYL HALLBERG, Contingent Worker: What I do like is the feeling of being free and able to move in a moment's notice.

SHELLEY KOFLER: But whether the lives of these so-called contingents is prosperous or precarious is the subject of heated debate

AMY DEAN, South Bay AFL-CIO: The next economic downturn that takes place in Silicon Valley, there will be no social safety net. There will be no safety net for contingent workers.

SHELLEY KOFLER: Labor unions warn of a crisis in the making.

AMY DEAN: The reason people should be concerned about what's happening in the Silicon Valley is that as goes Silicon Valley, so goes America.

BOB LEE, Manpower: You have lawyers now who work contingent. You have doctors who work contingent. You have people who have Ph.D.'s who work contingent.

SHELLEY KOFLER: Bob Lee is the regional director of Manpower, which places more temporary workers worldwide than any other agency. He doesn't see a crisis on the horizon, just a new way of working.

BOB LEE: Because we are on the leading edge with new products and we've got to get those products to market, because it's a world competitive advantage, they use contingent labor to help them get those products to market.

SHELLEY KOFLER: While this way of working is increasingly common throughout the country, some companies have sounded an alarm.

TELEVISION AD: Yahoo--

SHELLEY KOFLER: The Internet's Yahoo!, for example, won't hire contingents for critical programming positions because they may lack the dedication of full-time employees. Intel is so worried about the theft of company secrets, its contingent workers wear different colored badges and are barred from designing software. But there appears to be two classes of contingent workers: those with high level technical skills, like Donn Denman, and those who have little or not technical training.

ENO UTO-UKO, Contingent Worker: I work four jobs. And at times it is very frustrating--

SHELLEY KOFLER: Eno Uto-Uko works as a waitress and cashier. She often gets paged just hours before employers want her to come in.

ENO UTO-UKO: [at work] Help the next person?

SHELLEY KOFLER: Eno's story is startling. She says she has two bachelors degrees and paralegal training but can't find full-time employment. She says her lack of computer skills holds her back. So, she's taking classes at the community college, in hopes she'll become more marketable.

ENO UTO-UKO: I would love to have a full-time job, because number one, it would give my life some consistency.

SHELLEY KOFLER: Eno is the kind of contingent worker unions are trying to organize.

AMY DEAN: You don't need to be an economist to wake up in the morning, read the paper, go, "the economy is booming and I don't get it. It is not happening for me." Those two things together equal people are prepared to do battle.

SHELLEY KOFLER: Amy Dean heads the AFL-CIO in Silicon Valley. She wants to build her union's membership by pressing businesses into an agreement.

AMY DEAN: We're just going to move straight into the agenda that deals with the whole question of establishing some kind of code of conduct for temporary agencies in the Valley, as well as for the client companies that hire them.

SHELLEY KOFLER: The idea here is to create a code of conduct that addresses worker concerns.

EMMIE MOORE, Contingent Worker: If they say it's a temp-to-perm position, that's where they should be. They shouldn't be lying to us.

RICHELLE NOROYAN, contingent Worker: When I looked into purchasing the health insurance, it was basically very expensive and the deductible was $2,000.

ENO UTO-UKO: The most frustrating thing is, you could be ready to leave for work at 10 o'clock, and they'll call you at 9 o'clock to say that you're canceled.

SHELLEY KOFLER: The union will encourage workers to boycott companies that won't sign it's code of conduct.

BOW ROGERS: Frankly, I don't think it'll happen.

SHELLEY KOFLER: What PowerTV's Bow Rogers may not realize, however, is that some of his own contingent workers are struggling.

CHERYL HALLBERG: Insurance--medical insurance, that's my biggest concern.

SHELLEY KOFLER: Cheryl Hallberg is the company's employee recruiter and a temporary. She loves her PowerTV job. But she's checking out full-time jobs because she needs the benefits.

CHERYL HALLBERG: I'm being paid quite a bit less because of that. Benefits equal anywhere from--I suppose 20, to upwards of 35 and more percent of your salary. So, that's quite a chunk.

SHELLEY KOFLER: At 51, Cheryl has no retirement and no health insurance through work.

SHELLEY KOFLER: If he offered you a full-time job today, what would you do?

CHERYL HALLBERG: I'd take it.

JIM LEHRER: Our economics correspondent,Paul Solman, of WGBH-Boston, has more in a discussion taped least week.

PAUL SOLMAN: How broad a trend is contingent and part-time work, and how big a problem si it? Well, for that, we start with Jeffrey Joseph, vice president of the U.S. Chamber of Commerce. How pervasive a trend, how broad a phenomenon is this? Let's start with that.

JEFFREY JOSEPH, U.S. Chamber of Commerce: Well, I think there's about 120 million people working and about 28 million who are working part-time; 24 million of them who want to work part-time. So about 80 percent of the people working part-time are doing it because they want to. There's the other 20 percent who would love to have full-time employment, but they don't fit in a job right now. You have the round peg, square hole syndrome. And with the move into the 21st century, where we're going to have differing kinds of operating environments, away from the 19th century whistle-blowing, come in, punch the time clock at 8, and out at 5, into a globalized world, where business has need for people on an around-the-clock basis, there will be more and more opportunities for part-timers because there will be more windows of opportunity.

PAUL SOLMAN: All right. Well, Eileen Appelbaum has looked at this trend for the Economic Policy Institute here in Washington. And thanks for joining us. Not a big problem?

EILEEN APPELBAUM, Economic Policy Institute: Well, you know, we have just concluded a study looking at data collected by the Department of Labor on this. And we have a really good snapshot for the first time of the contingent work force and of how large it is. And what we find is that about a third of women and about a quarter of men--30 percent overall--are in what are called non-standard work arrangements, of which part-time work is one example. But there are also temporary workers, on-call workers, day laborers, people who work for contract companies, independent contractors, self-employed workers. This makes up a very large number of people--about 34 or 35 million people in this country--who do not have regular full-time jobs. The issue, I think, is really one of- -what causes there to be a problem is the question of pay for these jobs. And we saw in your clip at the beginning that small slice of the contingent or non-standard work force that does manage to get good wages, as well as the flexible hours--computer programers, high-powered consultants--those are the people for whom this works. I think most people are aware of the fact that workers in part-time jobs are paid less than workers in full-time jobs. But I think that one of the most surprising things that we found when we studied this phenomenon was what is happening to self-employed workers. Women, you know, are often told that a way around the glass ceiling is to start your own business--especially college-educated women. And we discovered when we did the study that college-educated women, who are self-employed, have a penalty in terms of hourly pay of 35 percent, compared to college-educated women in regular, full-time jobs. This is true even if you look at managers and professionals. If you take a look at self-employed managers and professionals, they have a penalty, a pay penalty, of 20 percent. So it's a very broad phenomena and a very important one.

PAUL SOLMAN: All right. Well, let's join John Tschohl now, has his own company in Bloomington, Minnesota. He provides customer training service or service training, I'm sorry. And the company, I guess, uses contingent workers almost exclusively, is that right, Mr. Shoale, so is what shejust said characteristic of your workers?

JOHN TSCHOHL, Service Quality Institute: I really disagree with that. We use a variety of people. We happen to pay the people that are independent substantially more per hour. I don't think we could hire them if we had to fire them full-time; they wouldn't accept the work because they like that freedom. They like that flexibility.

PAUL SOLMAN: Who are they? These are consultants? These are highly-trained professionals?

JOHN TSCHOHL: We use high professionals. Our person that manages our production for our company works out of her house. She is a 10 on a 10-point scale. She is a classy lady. We have people doing our software system that are all independent. These people would never work for us on a full-time basis. We couldn't afford to have them. We pay them a lot more money. So I tend to think the marketplace is moving toward more of the independent contractor, toward the self-employed, tremendous opportunity for these people.

PAUL SOLMAN: Briefly, Mrs. Applebaum, is he just a unique case here?

EILEEN APPELBAUM: Yes. I would say that he represents a very small part of the employers who make use of independent contractors. The one category is professional men, who are independent contractors. They do---are self-employed--they do make out quite well. But most other categories of non-standard workers, including self- employed women, by and large, pay a large pay penalty. And, in addition, we know that most of them do not have benefits. Only one in ten of the non-standard workers have health care benefits through an employer or have pension benefits through an employer. I think this is an important issue.

PAUL SOLMAN: All right. Well, we're finally joined by William Wolman in New York. He's been in business journalism for decades, is chief economist for Business Week Magazine. And Mr. Wolman, you recently co-wrote a book called the "Judas Economy," which touches on these issues. Give us the overview from your point of view.

WILLIAM WOLMAN, Business Week: Well, from my point of view, it's relatively simple. At the high end of highly skilled workers being an independent worker is working quite well. For most independent workers who are essentially in retailing or in food service or something like that, wages are far lower than they are for full-time workers. One thing that amazed me, Paul, was the degree of support for the Teamsters Union against United Parcel Service, and all that the polls--

PAUL SOLMAN: And, in fact, that's why we're doing this tonight.

WILLIAM WOLMAN: I know it. I just want to make the point: The polls showed, you know, that there was maybe over 50 percent--certainly a USA Today poll--of support for the workers, as opposed to the company. That was very surprising to lots of people, including me. And to me it indicates there is sort underneath everything a disquiet and a discomfort in the American public with the situation of part-time workers and people saying, gee, you know, maybe there's something wrong here.

PAUL SOLMAN: Mr. Joseph, what's the response to this? I mean, after all, people--two to one is actually the number, Mr. Wolman, of people supporting the Teamsters where people thought the Teamsters were something that, you know, nobody supported.

JEFFREY JOSEPH: Let's look at where we are. We've been going through rapid change in our economy. We've been going through the kind of change that's different than people who are now at work group up in. It's a different environment than they saw their parents go to work in. Most job creation today comes from smaller businesses. The big companies aren't producing the jobs. And by the nature of smaller companies creating the jobs, they don't have the economic platform that allows them to provide the same kind of benefits big companies do. They don't have the same tax preferences that big companies do. So, automatically, the nature of the companies creating the jobs can't even provide the same level of benefits. But then, as you contrast the--as you bring in other factors--globalization and telecommunications connectivity you have--you're just breeding the opportunity for people to come in and out of the work place, come in and out of the market place at will. And so people who have the right skills can find whatever niche they want in this kind of economy. They can find a full- time job, or they can find the part-time job if they have the right skills.

PAUL SOLMAN: Yes. But that's a big "if," isn't it?

EILEEN APPELBAUM: We looked specifically at managers and professionals. And we discovered, for example, that over 50 percent of managers and professionals who are in temporary jobs want full-time, regular employment. We did not find that workers who are managers and professionals, who are in these situations, with the exception of computer specialists and the very high-powered consultants, with that exception, we did not find that their wages were equal. We found that they were paid lower wages compared to other college-educated women, compared to other managers and professionals. We found that they did not have benefits, and we found that they were--had high anxiety about how long their job would last.

WILLIAM WOLMAN: I--that's right--

PAUL SOLMAN: Mr. Wolman, just for a second. I'd like to let Mr. Tschohl in. Mr. Tschohl, your workers are not anxious, none of them, like that woman we saw from Power TV?

JOHN TSCHOHL: I happen to think that, you know, first of all, 95 percent of our people--and I'm talking about our women--they're not men--and we're paying them $600 a day. We're paying them $75 an hour, $35 an hour. They get a lot more money than employees presently on board. I think that Eileen is wrong and that Jeff is more on target and that the marketplace has changed. People want flexibility. They want freedom. There's a lot of women that want to work at home. They have small children. They have--the daycare is incredibly expensive; they can work any hour of the day they want. They can--the marketplace has shifted. And today there's a lot of people that want that flexibility. We've got to encourage it, and we've got to support it. Women owning businesses today have more employees in the Fortune 500 companies.

PAUL SOLMAN: Mr. Wolman, you were trying to say something there--

WILLIAM WOLMAN: Well, I'd like to make the point that we should be very careful--we should be very careful about having a delusion of adequacy about what goes on in the United States as compared to other countries. In the course of doing the "Judas Economy," I visited Bangalore in India, which is a software center. It just seems--it's still very tiny by world standards, but it's growing incredibly fast and produces cheaply. It just seems to me that those people at the top of the income scale in the computer business, who are confident right now that, you know--I can work independently, nothing bad can happen to me--are going to have to watch what happens through--as companies with the computer and with telecommunications can hire contingency workers abroad just as easy as they can at home, given the delivery systems that are being evolved in this area. So it seems to me the world may be changing--and it's changed up to this point where, you know, in the high ends-- contingency workers are doing pretty well--but it's not stopped changing, it seems to me, and those workers at the top end will be threatened over the next decade, just as surely as the manufacturing worker was threatened when manufacturing became globalized. So I wouldn't get too excited about what's happening right now, but we need to worry about the future. And to repeat, the support for the Teamsters against UPS is a sign of anxiety about the sustainability and the worthwhileness of part-time work.

PAUL SOLMAN: Mr. Joseph, how do you explain the support for the Teamsters?

JEFFREY JOSEPH: Well, I agree with Mr. Wolman, but let's remember, the reason there were part-time workers in a two-tier contract system with the Teamsters was because competition in the 80's forced them and forced the union to agree to a second class of worker who would do in bits and pieces the same kind of work for a reduced salary, although perhaps pretty much the same benefits. Competition in the broadest sense is going to determine who's going to win and lose in the market place between big and small, between domestic and international. UPS was under competition--competitive pressures in the 80's. The unions knew that their salary system could not be extended to new workers without sinking the whole company. So, I mean, you know, you had this in a lot of industries. Whether it's India for software producers, or whatever the next fad is, anyone who is not prepared for a competitive work environment is not going to succeed, be it an employer or an employee. And every worker who gets the right kind of training for the right jobs that are available will succeed.

PAUL SOLMAN: Do you think that competition can go too far, I mean, will make people simply too anxious, too uncertain?

JEFFREY JOSEPH: No. You cannot hold back progress. Competition means that you're always going to have to improve yourself. Continuous improvement is where we have to go as a nation. Life-long learning is going to be the key to success. Young people are being told today when they go to college, prepare yourself to have five, six, or seven careers in your lifetime. And that's just the way it's going to be.

PAUL SOLMAN: Mrs. Applebaum for a second, and then Mr. Wolman.

EILEEN APPELBAUM: Yes. I would like to respond to a couple of these remarks. We are told that companies want to have continuous learning and so on. But I find that the ability to pay workers who are not in regular full- time positions less, and despite the fact that we have one employer here who is not doing that, I'm not saying every employer does that, but many do, because we know what the numbers show--that overwhelmingly, people in these jobs earn less and don't have benefits. The ability to pay people less because they're hired on a part-time basis, rather than a full-time basis, provides businesses with what economists call perverse incentives. I personally have no objection to a company hiring a part-time or a temporary worker when they have a business reason to do so. I think that's perfectly legitimate. And there are many people who want flexibility in their lives. Many of the workers, as has been pointed out here, are women with families, with children, and they're working to help make ends meet for their families.

PAUL SOLMAN: But the perverse part is?

EILEEN APPELBAUM: But the perverse part is that you pay these workers less simply because they're working fewer hours, simply on that basis, and this then sets up a perverse incentive for companies to hire part- time workers or temporary workers when there's no business reason to do so; to take what would have been regular full-time jobs at full-time wages and convert them--because you can pay less--into part-time or temporary or contract or whatever it is--other kinds of arrangements. I would like to just point out that the ability to pay people less on an hourly basis based on their hours of work is the last legal form of pay discrimination that we have in this country. It's legal in this country to have a full-time labor force that's predominantly male and a part- time labor force that's predominantly female. And you could not pay the women less than the men because they're women, but it is perfectly legal to pay them less because they are part-time workers and not full-time workers.

PAUL SOLMAN: Well, we've got about a million issues still to cover, and we have no time left in which to do them. And so, thank you all very much. I'm sure we'll continue with this one for years to come perhaps. RECAP

JIM LEHRER: Again, the major stories of this Labor Day, prosecutors in Paris said the man driving Princess Diana was intoxicated at the time of Sunday's fatal accident. The princess, her companion, and the driver were killed. Diana's funeral will be Saturday at Westminster Abbey in London. And in this country the federal minimum wage went up to $5.15 an hour, a 40 cent increase approved by Congress last summer. We'll see you on-line and again here tomorrow evening. I'm Jim Lehrer. Thank you and good night.