The MacNeil/Lehrer NewsHour

INTRO

JIM LEHRER: Good evening. Plans for a new government and elections were announced for Grenada today, as President Reagan declared the situation well in hand, and said the troops will soon be coming home. We also have one of our special Central America reports tonight, on the fears -- real or imagined -- the Sandinistas in Nicaragua have about the United States. Robin?

ROBERT MacNEIL: Also tonight, the decision by Jesse Jackson to make it official. We hear what black political observers think of his chances for the presidency. And we examine the growing trend towards hospitals out to make a profit: what are they doing to health care?

LEHRER: The war in Grenada is over; President Reagan declared it so this morning. He said U.S. goals have been accomplished, and the 5,600 U.S. troops will be leaving the small Caribbean island as soon as arrangements permit. Mr. Reagan made the announcement in a statement read to reporters in the White House briefing room.Central American Attitudes on U.S.

President RONALD REAGAN [at press briefing]: Our objectives have been achieved, and as soon as the logistics permit, American personnel will be leaving. I'd like to add that the members of the armed forces have conducted themselves in the finest tradition of the military. We can be proud of the courage and professionalism that we've seen from the people down there. The American students called them rescuers; the citizens of Grenada have hailed them as liberators. I think the whole lot of them deserve the respect and admiration of our country. The operation was not without cost; those who were killed, wounded or injured in this operation, I believe, are heroes of freedom.

LEHRER: That was followed by questions from reporters, some of which Mr. Reagan didn't care for.

REPORTER: Mr. President, Nicaragua has said you intend to invade that country. Do you, sir?

Pres. REAGAN: Who says?

REPORTER: Nicaraguan leaders, sir.

Pres. REAGAN: I haven't believed anything they've been saying since they got in charge. And you shouldn't either.

REPORTER: Mr. President, does the --

Pres. REAGAN: What?

REPORTER: Does the success of Grenada, as you view it, does that operation mean that you might be able to apply the military in similar situations elsewhere?

Pres. REAGAN: No, I can't foresee any situation that has exactly the same things that this one had. It had exactly what we announced in the beginning: the need to protect the lives and the safety and freedom of about a thousand Americans, most of them students down there in a medical school, and in answer to a request on the part of the other nations, bound by treaty together in the East Caribbean, that we lend our support to them in freeing this up, because they lacked the strength and capability --

REPORTER: If somebody else asks, would you be willing to do it again?

Pres. REAGAN: As I say, if all the conditions were the same, I don't see why our reason would be any different, but I don't foresee any similar situation on the horizon.

[crosstalk]

AIDE: Calm down just a little bit, please.

REPORTER: Why do 100 nations in the United Nations not agree with you that this was a worthwhile venture?

Pres. REAGAN: Helen, 100 nations in the United Nations have not agreed with us on just about everything that's come before them where we're involved. And you know, it didn't -- it didn't upset my breakfast at all.

REPORTER: Mr. President, some people say that the U.S. has now lost the moral high ground; that there's no difference between what we did in Grenada and what the Soviets did in Afghanistan. What's your response to that?

Pres. REAGAN: Oh, for heaven's sakes.Anyone who would link Afghanistan to this operation -- and incidentally, I know your frequent use of the word "invasion" -- this was a rescue mission. But in Afghanistan, if you will recall, when the Soviets installed their choice of head of state for Afghanistan, and in the process, in changing the forces there, an American ambassador was murdered in Afghanistan; and then against all the opposition of the Afghanistan people they have used every vicious form of warfare, including chemical warfare, the killing of women and children that has caused even some of their own men to desert because they would not carry out the orders to carry women -- to kill women and children; and they're still there, after a long period of time, longer than I have been in this office. As compared to what we did, in answer actually to an appeal that first came from the Governor General of the island, who was in house arrest, to his fellow states there in the Caribbean, appealing for rescue, and we helped in the rescue. Granted, that we -- we contributed the bulk of the power, but because -- only because the others were limited in their ability to do that. And this was a rescue mission, it was a successful rescue mission, and the people that have been rescued, and the Grenadians that have been liberated, are down there delighted with and giving every evidence of appreciation and gratitude to our men down there.

LEHRER: Later today the Governor General of Grenada told reporters an interim government would be appointed in Grenada within a week, and there would be democratic elections in the island nation within a year. Sir Paul Scoon said he was not consulting with the U.S. about the makeup of the government, although he reiterated the U.S. was there at his invitation, repeating Mr. Reagan's view, there was a rescue -- this was a rescue mission, said Scoon, it was a mission of liberation.

Yet to be liberated are some 600 Cubans captured by U.S. forces in Grenada; the U.S. says they will be returned to Cuba, but won't say when. Late in the day about 70 Cuban, Libyan and Soviet diplomats were expelled from Grenada; they left aboard two U.S. Air Force planes headed for Mexico. Robin?

MacNEIL: The other thing President Reagan came out to announce was the appointment of a new Middle East envoy to replace Robert MacFarlane, now national security adviser. Mr. Reagan's choice is Donald Rumsfeld, former defense secretary in the Ford administration and now president of a drug company. The President said Rumsfeld will become the point man in U.S. efforts to secure peace in Lebanon, and a wider Middle East settlement.

In making the Rumsfeld announcement, Mr. Reagan called on leaders of the Lebanese groups to put the problems of the past aside. In Geneva, those leaders continue to work on a key obstacle to agreement: Lebanon's security pact with Israel.

Meanwhile, near Tripoli, Lebanon, the remnants of Yasir Arafat's Palestinian Liberation organization forces came under heavy attack from Syrian-backed PLO rivals. Here is a report by Chris Morris of the BBC.

CHRIS MORRIS, BBC: PLO guerrillas loyal to Yasir Arafat blast rebel positions. The rebels launched their full-scale attack at dawn. In the shelling, Tripoli's oil refinery was hit, storage tanks set ablaze, a huge pall of black smoke cast a shadow over Lebanon's second city. Today's fighting was around two Palestinian camps, home for 45,000 refugees. The camps have become the last stronghold in the Middle East for Arafat and his supporters. The Fatah rebels seeking to overthrow the PLO chairman are supported by Syrian and Libyan forces using tanks and artillery. Arafat's boy soldiers hardly seem experienced or strong enough to take on the might of the rebels and the Syrian army, but they vow to fight to the death in a last stand.

With up to 140 artillery guns pounding away in the mountains, casualties today were high. [unintelligible] shells fell in the camps, several were fired indiscriminately into the center of Tripoli. Many people were killed or wounded in the city streets, though in the refugee camps the toll was much higher. At this Palestinian hospital, the casualties were mostly civilians. Yasir Arafat himself later emerged unscathed from the bombardment.

YASIR ARAFAT: Oh, it is all offense, all offense.

MAN: [unintelligible]

Mr. ARAFAT: Yes, as in [unintelligible]

REPORTER: Who is wounded, people wounded?

Mr. ARAFAT: Yes, wounded and killed, and specially, we -- I will not give now the final letter.

MORRIS [voice-over]: The Syrians helping the rebels seemed determined this time to crush Arafat and his fighters. They've now been forced to retreat while Arafat himself has appealed to Arab leaders to act immediately to avert what he called a "new massacre."

MacNEIL: When the casualties for the day were finally added up, it was 34 Palestinian guerrillas killed and 119 wounded. Jim?

LEHRER: In this country, in Boston, the FBI arrested an East German physicist who was accused of trying to obtain classified documents from a civilian employee of the Navy. The FBI said the East German, 44-year-old Alfred Zehe, had asked the American for documents dealing with military technology, but the FBI did not say what kind.

And a Soviet submarine has turned up lame off the Atlantic coast, some 470 miles east of Charleston, South Carolina. Pentagon officials said it was a nuclear-powered attack submarine which normally carries a crew of 90 but no missiles. The sub has apparently experienced some unknown mechanical problem, the official said, because it is riding along the surface at about two knots. A Soviet trawler is reported to be in the area, and a Soviet sub tender is said to be on its way from a base in Cuba. Robin?

MacNEIL: There were two developments today in the controversy over U.S. covert aid to the Contras, or opposition forces based in Honduras and Costa Rica, who are fighting the Sandinista government of Nicaragua. The U.S. Senate on a voice vote approved further funding for the Contras. The House has twice voted to cut off such aid, and the question now faces a negotiation in a conference committee. Meanwhile, an effort to stop covert aid through the courts had an initial success: a federal judge in San Francisco ordered Attorney General William French Smith to conduct an investigation into whether covert aid violates the Neutrality Act. The suit was brought last July by California Democratic Congressman Ron Dellums and others. U.S. District Judge Stanley Weigel said today that if Attorney General Smith fails to make the determination within 90 days, a special prosecutor must be appointed to investigate. The Justice Department said it would have no comment until it had studied the ruling.

Meanwhile in Washington, administration officials are reported as saying that last week's Grenada invasion brings added pressure on the Sandinistas. Tonight we have a special report that makes clear that Nicaragua's rulers were feeling a lot of pressure anyway. The documentary was made just before the Grenada invasion by Charles Krause, on special assignment in Nicaragua for this program.

CHARLES KRAUSE [voice-over]: The Sandinistas are fighting for the very survival of the revolution they began four years ago, and they know it. Military funerals, like the one we witnessed recently in San Ramon, have become a daily fact of life in towns and cities across Nicaragua. The Contras have killed hundreds of Sandinista soldiers, militiamen and civilians so far this year. Nicaragua is today a country at war. The Sandinistas deny the Contras have internal support. They claim the CIA is backing the Contras and without that backing, the Contras would be easily defeated.

Even in the most remote regions of Nicaragua where the Contras have blown bridges and disrupted daily life, the government's propaganda is aimed not at the counterrevolutionaries; it's aimed at the United States, which is painted here as the real enemy. Sandinista leaders fear the Reagan administration will not be satisfied until their government, allied with Cuba and admittedly Socialist, is overthrown.

MIGUEL D'ESCOTO, Nicaraguan foreign minister: I think there is no doubt in anyone's mind that the United States government continues to be wedded very firmly to the idea of imposing its will upon our country by means of military force.

EDMUNDO JARQUIN, Nicaraguan minister of international reconstruction [through interpreter]: We appreciate at least one quality of the current administration: its frankness. We Latin Americans do not need to make any effort to interpret what objectives are behind the rhetoric contained in the speeches of the North American leaders. The Republican election platform, and it's being repeated time and again this past few years, that their objective is to bring down the Sandinista government. There's no need to interpret anything; this is their objective.

KRAUSE [voice-over]: The Sandinistas claim they are ready to defend their revolution at all costs. "A free Nicaragua or death" is their battle cry. As tensions mount, they are mobilizing their reserves. So far an estimated 25,000 militiamen have been called to arms, doubling the strength of Nicaragua's regular army, already the largest in Central America. Along Nicaragua's northern border with Honduras, where the Sandinistas are braced for heavy fighting, towns like Mozonte have been turned into military garrisons. Armed with Soviet weapons, the troops are tough and well-indoctrinated. Political graffiti expresses their confidence. This wall slogan reads, "With ploughshares, rifles and the Sandinista National Liberation Front, we will defeat them."

But the Sandinistas have been powerless to defeat the Contras' increasingly effective guerrilla campaign to destroy Nicaragua's economy. The country now has less than a month's supply of petroleum, in part because the Contras destroyed oil storage tanks and an underwater pipeline in three different Nicaraguan ports. Also destroyed by the Contras, two important Customs' posts along the Pan American Highway -- this one at the Honduran border and another at the Costa Rican border. Vital trade with Nicaragua's Central American neighbors has come to a virtual halt. The guerrillas' most recent targets include agricultural cooperatives, in a country that depends on coffee, sugar, cotton and tobacco for at least 60% of its export earnings.

Along the Honduran border, so many camposinos have fled the fighting that the Sandinistas have been forced to send militiamen to work coffee plantations, just as the harvest season approaches. In all, directly and indirectly, the government estimates that the Contras have cost Nicaragua more than $400 million this year. The Sandinistas view the destruction as part of a larger campaign by the Reagan administration to strangle them economically. Edmundo Jarquin is Nicaragua's minister for international reconstruction.

Mr. JARQUIN [through interpreter]: The present administration initiated its aggression in the economic field precisely with the purpose of creating great difficulty for us that would generare unrest and opposition among the people, and thus generate a social and political basis for the forthcoming military aggression.

KRAUSE [voice-over]: U.S. economic aid to the Sandinistas ended in 1981. As relations deteriorated further, Jarquin claims the Reagan administration began an informal economic blockade.

Mr. JARQUIN [through interpreter]: [unintelligible] refused to sell us some spare parts. I agree that they were sophisticated technology and in a country like Nicaragua, with 3 million inhabitants, could have the capacity to absorb strategic or sophisticated technology. They were spare parts for IBM typewriters, and for the small computers that we have in Nicaragua.

KRAUSE: Most important from Nicaragua's point of view, the administration has used its power whenever possible to block international loans.

Mr. JARQUIN [through interpreter]: This is dramatic: if last year we had obtained the same capital resources that we received in 1981, the Nicaraguan economy would have grown by 7%.

KRAUSE [voice-over]: Instead, Nicaragua's economy declined last year. Basic commodities -- grain, sugar, cooking oil, even toilet paper and soap -- are rationed or sometimes unavailable. Even before the Contras sabotaged the country's petroleum supply, Nicaraguans were permitted to buy only 20 gallons of gasoline a month, at $4.40 a gallon. Many of the shortages are in fact a product of the Sandinistas' own economic mismanagement. The Contras are deliberately making matters worse. Their hope is that average Nicaraguans, faced with the prospect of economic ruin, of going hungry, will turn against the Sandinista government. Adolfo Calero is commander-in-chief of the Nicaraguan Democratic Force, the counterrevolutionary army based in Honduras.

[interviewing] To what extent could this campaign of economic sabotage backfire?

ADOLFO CALERO, commander, Nicaraguan Democratic Force: Well, we have continued feedback from Nicaragua, where people in Nicaragua are going around with smiles on their faces, they're all happy, they can't wait the moment for the Contra, as they say, to arrive in Nicaragua and to free them.

KRAUSE [voice-over]: That is not what we found during our three weeks in Nicaragua. The Contras do have some support among wealthy businessmen, some sectors of the urban middle class, and even some poor farmers who own their own land. But most Nicaraguans are loyal to the Sandinistas. They blame the Contras and the United States for their economic problems and the suffering the war has caused. Thousands have been forced to evacuate their homes because of the fighting. At this church in Somoto, not far from the Honduran border, we found women and children, all of them refugees from the war. Their songs are love songs, but they're afraid to go home. Veronica Ramos told us the Contras killed her brother when they attacked El Espino, the town where she lived. "We live in a country that's more or less free," she said, "We're not repressed like before. Why don't they let us live in peace?"

Father XAVIER GOROSTIAGA, Jesuit priest: I would say that now the revolution has more popular support than a year ago, because this escalation is repeating the historical process of intervention against Nicaragua, and this is again creating a sort of unity in the country.

KRAUSE [voice-over]: Xavier Gorostiaga is a Jesuit priest, an economist and a Sandinista supporter.

Father GOROSTIAGA: In many ways, this very aggressive U.S. policy of the present administration has consolidated the revolution, has not thwarted the revolution.

KRAUSE [voice-over]: The Sandinistas like to think of themselves as David fighting Goliath, that is, the United States. With their Soviet weapons, Cuban advisors and revolutionary fervor, until recently they thought the world was theirs. But now they know they're in trouble; the Contras, even without great popular support, are inflicting far heavier wounds than the Sandinistas ever thought possible. There's a real danger of war with neighboring Honduras, and the Reagan administration is showing no sign yet of calling a truce.

This is Charles Krause, reporting from Nicaragua.

MacNEIL: President Reagan's special envoy from Central America, Richard Stone, left Washington today on a further round of talks on a negotiated settlement for the violence in the region. He goes first to Honduras and may include Nicaragua after visiting several other countries.Jim?

LEHRER: There was an election in South Africa yesterday, and the result was just as expected and so were the reactions to the result. The vote was not on a person or a party, but on a constitutional change that would give limited parliamentary representation to Asians and people of mixed race.Only members of the nation's white minority were allowed to vote, and they approved the change two to one. The government of Prime Minister P.W. Botha hailed the vote as a major victory and said it could lead to evolutionary reforms for the nation's majority race, the blacks, who were not involved in yesterday's election either as voters or beneficiaries.Liberals and black leaders said the change was nothing but a big con job. Michael Burke of the BBC has this report.

MICHAEL BURKE, BBC [voice-over]: In the end, two-thirds of those who voted backed the government. Allowing for those who didn't vote, almost exactly half the white population said yes. It was a triumph Mr. Botha had worked hard for, when he began, he predicted a more overwhelming victory, but in recent days his aides have been afraid it would be close. Instead, he got the sort of victory he wanted.

P.W. BOTHA, South African prime minister: I appeal to those South Africans who voted no, to make this decision their own.

BURKE [voice-over]: So where does today's vote leaves South Africa's policy of apartheid?

Prime Min. BOTHA: It depends what you mean by it. If it means oppression, if it means destroying the rights of people, I'm not for it. But as I've stated since I became prime minister, that I'm for a positive approach to the rights and privileges and traditions and ideas of every population group in the subcontinent of Southern Africa, and I have proved it.

BURKE [voice-over]: Dr. Nthato Motlana, a leading black politician in Soweto, watched the results on television. The referendum, he says, will make things worse, not better.

Dr. NTHATO MOTLANA: Of course, we blacks are not impressed at all. Our argument has always been that in ignoring 72% of the population, the results don't mean much at all.

BURKE [voice-over]: Today's results could give Mr. Botha elbow room to liberalize some race laws -- the mixed marriage act, for instance; but the central structure of apartheid is likely to remain.

LEHRER: That report from Michael Burke of the BBC. We'll be back in a moment.

[Video postcard -- Grafton, Utah]

LEHRER: Two major strikes involving cars and buses are having their fallout today. The bus strike is against Greyound, the nation's largest intercity bus company. Greyhound drivers and other employees stopped work last night after the Almagamated Transit Union and the company failed to reach agreement on a new contract. The company wants pay cuts the union says are unreasonable. Greyhound's major competitor, Trailways, and other companies put on extra buses today to accommodate would-be Greyhound passengers; all bus companies as well as Amtrak are honoring Greyhound tickets. Greyhound has appealed directly to individual employees to return to work, and company officials said today a decision on whether to start up again with non-union workers awaits their response.

The other strike is against Chrysler, and the story is of a ripple effect. Fifteen thousand Chrysler workers were furloughed today after four auto assembly plants had to be closed for lack of parts. The parts come from a Chrysler stamping plant at Twinsburg, Ohio, which has been struck by 3,200 workers in a dispute over work rule, safety and job assignments. Chrysler chairman Lee Iacocca said today more plants will have to be closed if the strike is not settled soon. He said a month or two close-down of all eight of the company's assembly plants could lead to a Chrysler bankruptcy. Robin?

MacNEIL: Today's economic news wasn't all grim: retail sales were up sharply again in October. Sears, Roebuck reported a 32% gain over October of 1982. K Mart, J. C. Penny and Woolworth's also reported better business. And sales of new houses went up in September 13.7% over August, after three months of declining sales, even though the median price of a new home went up $5,400 to $82,000. Jim? Jesse Jackson Declares Candidacy

LEHRER: Jesse Jackson became a candidate for president today, and he did it in Jesse Jackson style, with a 40-minute oration of fire and fury before more than 2,000 cheering, clapping supporters at the Washington Convention Center.

JESSE JACKSON, presidential candidate: "Yea, though I walked through the valley and shadows of death, I will fear no evil, for Thou art with me, Thy rod and Thy staff, they comfort me." Our time has come -- all the way from the statehouse to the courthouse to the White House, our time has come! God bless you. [cheers, applause]

LEHRER: The emotional pleasure of the event was cut cold at two early moments, when two hecklers who identified themselves as members of a militant Jewish group accused Jackson of being anti-Semitic. This was the scene during one of those incidents.

Mr. JACKSON: That we might serve the ends of justice, and --

HECKLER: Anti-Semite! [confused shouting] Anti-Semite! [shouting]

CROWD: Run, Jesse, run! Run, Jesse, run! Run, Jesse, run!

LEHRER: After the tenseness caused by those episodes was gone, Jesse Jackson got down to the business of his speech, and here are some excerpts.

Mr. JACKSON: I seek the presidency to serve the nation at a level where I can help restore a moral tone, a redemptive spirit, and a sensitivity to the poor and the dispossessed of this nation. I seek the presidency because I want this nation to again become the hope of the free world, not merely because of the power by armament, but because developing nations understand by our foreign policy and programs of aid, that the inscription on the Statue of Liberty is truth: "Give me your tired, your poor, your huddled masses yearning to breathe free." My foreign policy proposals would seek to emphasize negotiation over confrontation, gunboat and big stick diplomacy, military adventurism and racial insensitivity. We will seek to measure civil rights for all human beings by one yardstick. We will no longer send mixed signals to the world; we can no longer define democracy as majority rule in America and minority rule in South Africa. We cannot condemn invasion and occupation of foreign lands by the Soviet Union and engage in the same actions ourselves. We as a nation representing [unintelligible] power cannot stand on a neck like Grenada and get a sense of self-esteem; we must go another way.

Women cannot be free until blacks and Hispanics are free. Blacks, whites, women, Hispanics, workers, Indians, Chinese, Filipinos -- we must come together and form the rainbow coalition. We need each other.

I'm not talking about one man running for an office, not about heisting any man; it's about elevating the masses, the people; it's about if I want to get across the finish line first, and my wagon was not hitched, I may have a gold medal but I would be a loser. If I got across the line last, but my wagon was full of registrars and tax assessors and legislators and school board members and judges and governors and supervised public service, it's about missing the boat [unintelligible]. I submit to you today, we can do without Democratic or Republican parties; they cannot do without us. We are necessary, we must assert ourselves. Our time has come.

LEHRER: Jesse Jackson is a 42-year-old Baptist minister and former protege of the late Martin Luther King. He's been in the thick of civil rights issues and controversy for years, but politically, he's starting at the top as candidate number eight for the 1984 Democratic nomination. He's never held public office or run for one until now. After his speech this afternoon Judy Woodruff talked to him about why now, why the presidency.

Mr. JACKSON: If the Democratic Party really fights vigorously to enforce the Voting Rights Act, and blacks and Hispanics are enfranchised, that becomes the key to ERA being passed in the South. And women are enfranchised and the right to work laws in the South. Democrats have been much too silent about this crisis, a fundamental structural crisis.

JUDY WOODRUFF: But there are other Democrats running for the presidency, several of the seven who are already running, who are interested in doing the same sorts of things that you're talking about.

Mr. JACKSON: There is no evidence that a one of them has made a serious commitment to Voting Rights Act enforcement. Not a one of them have challenged states' segregated slates, or challenged second primaries or challenged dual registration, they have not done it. They have not been willing to challenge trade unions to open up, as they lock out blacks, Hispanics and women. Our challenge is to expand the Democratic Party and make more room for more people. Besides that, some of them, because people are not clear on where they stand, have not been able to excite interest amongst the masses of the people.

WOODRUFF: Are you talking about Mondale?

Mr. JACKSON: Well, not just about Mondale, none of them have really caught fire in the sense that a Democratic candidate must. I do think that between now and the convention in San Francisco that we will raise issues at a level where no Democratic candidate will be able to ignore issues as they impact upon poor people and people who are locked out. One strategy recommended, for example, to the Democratic candidates, was by Ham Jordan and Bert Lance: they stay away from special interest groups, women and blacks, Hispanics -- can I deal with the urban crowd. The fact is, 20 years after the Voting Rights Act, women will be 50% of the convention in San Francisco, blacks 20%, plus Hispanics -- the old minorities in coalition are the new majority.

WOODRUFF: Why do you think Mondale is being so criticized, then, for going after the special interests?

Mr. JACKSON: I think that some of the challenge on Mondale about going after special interest groups is really sour grapes. I think he has great reason to go after the interests of women and Hispanics and blacks -- I don't think that's a fair criticism leveled at him. I think what must happen beyond going after them, they must be changed. They cannot just be given approval on the present -- how can you endorse or accept endorsement of a labor union without challenge when it's discriminating against blacks, Hispanics and women? It in fact is violating fundamental principles. We must make room within corporate America, within the trade union movement and within the Democratic Party for people who are locked out. And at this point none of the candidates choose to challenge them. They tend to want to be embraced by them, rather than to confront them and open up negotiations.

WOODRUFF: Well, what good does it do, though, for you to raise these issues if you end up weakening the candidates who stand the best chance of implementing those ideas and winning?

Mr. JACKSON: If in the process of raising them, and you begin to raise live issues, you increase registration and increase voter participation, that is the key to victory in 1984. By 10,000 people running for congressperson and legislator and judge and tax assessor and registrar, it institutionalizes the drive for change, so it's not just a person running for an office, it's a whole new movement of people becoming involved in the political process again.

WOODRUFF: You're getting into this race very late, there's a lot of money that hasn't been raised yet, you haven't got the organization the other candidates do in the early states -- how in the world can you catch up?

Mr. JACKSON: If money meant so much and their organization meant so much, why would they be running behind me even before I announced officially? Apparently you missed the point that when you seize the spirit of the moment, that people can do tremendous things when their minds are changed.What you're looking at right now is a political explosion, and no one can quite calculate the impact of it. I submit to you it's not going to be limited just to blacks; this is not going to be a blacks-only movement. When we get through dealing with the industrial policy, and stopping plants from being closed and new foreign policy in this country, we're going to rearrange the priorities on the American political agenda.

WOODRUFF: There's a lot of disagreement over the wisdom of Jackson, of any black, making a run for the presidency, and here to talk about that are two leading spokesmen from the black community. First, from the public television studios of WTVS in Detroit, its mayor Coleman Young. Mayor Young is also a ranking official in the National Democratic Party. And here in Washington, Eddie Williams, who is president of the Joint Center for Political Studies, a research institution specializing in minority issues. Mayor Young, can Jesse Jackson win?

COLEMAN YOUNG: I don't believe that he can, I don't believe Jesse Jackson believes he can win.

WOODRUFF: Why not?

Mayor YOUNG: There is no history of any black candidate being able to get sufficient white votes, in the first place, to be able to win the Democratic nomination, and that's what must be done.

WOODRUFF: But you've just heard him refer to a political explosion, talked about seizing the moment. Don't you think that there's any remote chance?

Mayor YOUNG: That's a beautiful analogy, that's beautiful phraseology, don't believe it has too much to do with reality. I do not perceive any explosion.

WOODRUFF: Mr. Williams, you're -- you are going to remain non-partisan in this campaign, but what would Jesse Jackson people say in answer to the question, can he win -- do they really think he's got a chance?

EDDIE WILLIAMS: I think -- I think most people acknowledge, either publicly as Mayor Young does, or privately, that he cannot win the nomination. The issue is, what are his goals? It's very interesting today that he gave that analogy at the end of his speech about the wagon crossing the lines, and one can interpret that in many ways. I tended to interpret it by its meaning, if you cross the finish line first without the wagon, without bringing other people along, he did not consider that to be successful, even though he got the medal, however one defines the gold medal. He also said that if he finished the line last, and brought along a wagonload of voters and new political participants, and enhanced the political arena by new policy issues, that that would be considered success. Clearly, his greatest chances for success are in terms of enhancing and diversifying the public policy arena, and increasing political mobilization among blacks, Hispanics and other Americans.

WOODRUFF: So you're saying that's really the only point of his running, that he knows he's not going to win.

Mr. WILLIAMS: No, that's not the only point of his running. I think he believes, and I -- our survey shows he can pick up some delegates. It's debatable how many, but if he picks up a significant amount of delegates, then it is possible that he can have some influence at the convention, should the convention be close enough so that a small bloc of votes could make a difference.

WOODRUFF: Mayor Young, you've endorsed Walter Mondale already, but what effect do you think Jesse Jackson can have on this campaign?

Mayor YOUNG: At this moment I think that Jesse Jackson's campaign will be more of a media campaign, I do not think that he will get very many votes, very many delegates, and therefore not have too great an effect upon the campaign itself. He could have an effect if he gets some more delegates than I anticipate, harming those Democrats who come closest to espousing the same program that he says he espouses, and strengthening those who are more conservative.

WOODRUFF: Are you saying he's just in as a spoiler?

Mayor YOUNG: I don't think he perceives himself to be a spoiler, I'm saying the objective result of his entry, if he gets any large number of delegates, could be just that, despite his intentions. I do not question Jesse Jackson's good intentions at this point; I debate with him whether he can achieve the results he says that he can achieve. I do not believe he's going to get a whole lot of people to register or run for office in support of a candidate that they know cannot win. Black voters and voters generally are not in the habit of throwing their vote away.

WOODRUFF: Mr. Williams, what about that?

Mr. WILLIAMS: Well, I think the mayor is absolutely correct; that is a major challenge to the Jackson candidacy.It is a challenge that he believes that he can overcome. Obviously he has identified a significant amount of support around the country. Judy, it's almost a classic case in which reasonable people can differ. It is a question of tactics, it is a question of strategy, it is a question of what assumptions one wants to make, and what are one's own self-interests.

WOODRUFF: But in the real world, as Mayor Young said, isn't he going to take votes away from Walter Mondale and from some of the other more liberal candidates at the more liberal end of the spectrum?

Mr. WILLIAMS: Well, that is quite possible, so will Gary Hart, so will Senator Cranston; and so the question is, is, so what? He in the candi -- he's in the campaign also. I would assume from his point of view, and I don't know totally his strategy or his point of view, that his candidacy may be very well be such so that he could opt out at any point along the way, in which he feels there is significant response to what he perceives to be some of the causes and considerations of the people that -- that he represents. But I think that -- in the South, particularly, yes, he could take votes away from Mondale. I do not assume, however, that Vice President Mondale will roll over and play dead, now, with respect to the black vote. I think he will contest for those votes; I think he will be aided considerably by leaders like Mayor Young, who will also assist him.

WOODRUFF: Well, Mayor Young, Jesse Jackson has said that -- or rather, you've just said that he may end up being -- end up in a situation where he is going to have to gracefully get out of this race, there was a reference made to that. How does he do that? Do you think it's possible for him to cut a deal?

Mayor YOUNG: First of all, I did not say that. Whether he can cut a deal or would want to cut a deal is a matter of speculation. I think the only question in my mind, that if Jesse realizes he cannot win, and I think that he does, he would like to set himself up as the official broker for the voter which he aspires to represent. These would obviously be in the main black voters, and such others as he could attract.

WOODRUFF: Now how would that work?

Mayor YOUNG: He would sit down at the convention and say. I speak for so many voters, and therefore lay a set of demands before the Democratic Party. He's said himself that we need -- that black people need to redefine the compact with the Democratic Party. I think that's a good aspiration, but I believe the major objective in 1984 will be to get a new president. We need desperately a new president in the White House; any political strategy must be judged as to whether or not it advances that objective. And I do not believe Jesse's candidacy strengthens that objective.

WOODRUFF: All right, thank you, Mayor Coleman Young and Eddie Williams, for joining us. Robin? For-Profit Vs. Not-For Profit Hospitals

MacNEIL: Also in Washington today, the Justice Department warned mental hospitals around the nation that the government is prepared to use the civil rights laws to protect mental patients from abuse. The warning followed indictments against nine employees of a Pennsylvania state institution for the mentally retarded. They were charged with beating, kicking, slapping or punching patients. William Bradford Reynolds, assistant attorney general and head of the Civil Rights Division of the Justice Department, said this should give a clear message to employees of state mental hospitals and facilities for the mentally retarded across the country that abuse of patients will not be tolerated by the federal government. We'll be back in a moment.

[Video postcard -- Grafton, Utah]

MacNEIL: Our last major story tonight comes from our medical beat. It's really a story about the business of medicine. Today one of the country's leading psychiatric centers, McLean Hospital near Boston, refused to sell out to the largest chain of investor-owned hospitals in the nation. McLean is affiliated with the Harvard Medical School, and is a major teaching hospital. The Hospital Corporation of America, based in Nashville, wanted to buy it for an estimated $40-60 million. But there was overwhelming opposition from the medical staff and the Harvard faculty, and today the hospital withdrew. Right now, 15%, or 1,100, of the country's hospitals are owned by private corporations trying to make a profit. All the rest are operated by government or nonprofit groups. For-a-profit medicine has been growing rapidly. In 1960, private companies owned 39,000 hospital beds; last year it was 91,000. The trend worries many in the health field. The prestigious New England Journal of Medicine said in a recent editorial that for-profit hospitals charge more and are less cost-effective than their non-for-profit counterparts. Dr. Arnold Relman is the editor of the Journal, and a professor of medicine at Harvard. He joins us tonight from Boston at public station WGBH. Dr. Relman, I understand you opposed the sale of this hospital to the Hospital Corporation of America, why -- why did you?

Dr. ARNOLD RELMAN: I opposed it for two reasons: one, because for many reasons, I think that for-profit hospitals pose very serious problems for the American public and for the medical profession. And secondly, more specifically, I think that it's a bad idea for universities like Harvard to be affiliated in an operational way with the fortunes of a for-profit company.

MacNEIL: Even though the Hospital Corporation of America promised to carry on the role of McLean's as a teaching hospital?

Dr. RELMAN: Yes. I think that's not the essential point. I think the point is that a university must be independent, it must be free to examine, criticize, change policies, recommend new policies; and when a university like Harvard, a medical school like Harvard, ties its fortunes to the fortunes of a for-profit company, it loses that ability. It loses its credibility and it loses its independent status.

MacNEIL: With medical costs in this country soaring, what is wrong with applying business sense and profit-or-loss to the operations of hospitals?

Dr. RELMAN: Business sense in the sense of business management is a good thing, and I favor, and I think most observers favor a businesslike approach to the management of health care facilities.But the philosophy of for-profit, the operation of health care facilities for the benefit of investors, is another matter. When you do that, you begin to be concerned about sales, about total volume, about providing services that are profitable rather than the services that are needed by a community, and your whole orientation changes. That, it seems to me, is not good for the American public.

MacNEIL: You said it raised a number of problems; is one of them -- does the mission of doctors themselves change, in your view, in a for-profit situation?

Dr. RELMAN: Well, that's the risk. The American medical profession is already struggling in a difficult situation to maintain its professionalism, to maintain its independence or powerful economic forces that are changing the behavior of doctors and making doctors more entrepreneurial.The appearance of for-profit hospitals and the involvement of doctors in these for-profit hospitals, I think makes it even more difficult, and I'm afraid that the professionalism and the social commitment of doctors to the American public may ultimately be eroded by the continuing growth of the for-profit health care business.

MacNEIL: Thank you.We'll come back. Jim?

LEHRER: The loser, if that's the word, in today's action was the Hospital Corporation of America, the largest hospital chain in the country. It owns or operates 385 hospitals in the U.S., five others overseas. The chairman of the company is Donald McNaughten, who joins us tonight from public station WDCN in Nashville, Tennessee. Mr. McNaughten, I would guess that you would see McLean as the loser tonight, correct?

DONALD McNAUGHTEN: You're quite right on that. As a matter of fact, our feelings are mixed with respect to the report, mixed because the report said so many nice things about for-profit institutions and particularly about Hospital Corporation of America. Of course, we're unhappy because the offer that we made, in the form that we made it, was rejected. But you're quite right, we think that the real losers on this were McLean, the Harvard Medical School, and the Massachusetts General Hospital.

LEHRER: Now, why is that? Why would that hospital be better off run by your company than as it is now?

Mr. McNAUGHTEN: Well, first of all, they have a very serious financial problem. They have -- they are committed to, and need to, upgrade their facilities to the tune of somewhere in the neighborhood of $35 million, and it's very difficult for them to raise that, particularly in the light of the fact that the parent corporation, Massachusetts General Corporation, which also is the parent of Massachusetts General Hospital, has stated that it needs somewhere in the neighborhood of $250 million, including the $35 million for McLean.

LEHRER: And so you'd be in a position to provide that --

Mr. McNAUGHTEN: We had offered to --

LEHRER: To do that.

Mr. McNAUGHTEN: To do that.

LEHRER: Well, generally speaking, you heard what Dr. Relman said. Does the profit motive distort a hospital's mission to cure the sick?

Mr. McNAUGHTEN: Of course not. But before I answer that --

LEHRER: Sure.

Mr. McNAUGHTEN: If I may, let me say that -- I would say that to the extent that he contributed to this decision by his vocalizing and using his prestigious journal, the journal of -- the New England Journal of Medicine, in his editorial capacity, I think that he has definitely done a real disservice to all three institutions -- the medical school, McLean, and to Mass General. Now, in response to your question, I think we ought to get it clear what for-profit is. I think that there is little distinction between a for-profit institution and a not-for-profit institution. The real differences in our institution from most not-for-profit hospitals, is that we have a group of hospitals. We have some 385 hospitals that -- some of them we own, and others we manage for other owners, most of them not-for-profit hospitals. But the difference in profits is an illusionary one. All good hospitals that are going to last any length of time must take in more money than they pay out.

LEHRER: Whether they're for profit or --

Mr. McNAUGHTEN: Whether they're for-profit or not-for-profit, that's correct. And in the case of the for-profits, that's called profit; in the case of the not-for-profit hospitals, that's called reserves. And in both instances, those are funds that are used to pay for the future costs of the institutions.

LEHRER: Thank you. Robin?

MacNEIL: Dr. Relman, you heard what Mr. McNaughten said, that the sufferers, the people who lose are the hospital and Massachusetts patients; that they would be prepared to spend the $35 million necessary to upgrade the facilities at McLean.

Dr. RELMAN: Yes, I'm sure that HCA would have made a very attractive financial offer, but the Harvard Medical School faculty, for I think good and sufficient reasons, decided that the financial gains to the Harvard Medical School and to the MGH, did not justify this dramatic change in policy and philosophy that affiliation with a for-profit corporation -- operating affiliation between a for-profit corporation and the university would mean. I must differ with Mr. McNaughten; I of course expressed my opinion as an individual, I am simply one member, a part-time member of the Harvard faculty, I might say; but the Harvard faculty is noted to be a highly independent and free-thinking body.The faculty at the McLean Hospital voted 81% against the affiliation. That was their judgment, not mine. Now, as far as the profit situation is concerned, of course, every hospital tries to have an operating surplus, but the point is that the difference that I am pointing to is the difference in what the hospital does with its resources, how it operates in the community, what it does with the profits that it makes. The for-profit companies have to pay their investors; the main function is to generate a profit for their investors. The not-for-profit companies use their surplus, if any, to meet the community's needs, to meet what they think are the health care needs of society.

MacNEIL: Let me put those points to Mr. McNaughten. Mr. McNaughten, you just heard that argument.

Mr. McNAUGHTEN: Yes, our mission is precisely the same as the mission of any good hospital or hospital -- group of hospitals, whether they be not-for-profit or for-profit, and our mission is emblazoned in bonds and every one of our -- in some detail in every one of our institutions. But to summarize the mission, it is that we will -- we will provide quality health care wherever we are at a reasonable cost. And that's no different from the mission of not-for-profit hospitals. Now let's talk a little bit about what our profits really are. For every dollar that we take in, we make a profit of five cents, and of that five cents, we pay to our stockholders -- Dr. Relman says this is where the money goes -- we pay of the five cents in profit, we pay three-quarters of one cent, and the other four-and-a-quarter cents go right back into the business, to maintain and upgrade the plant.

MacNEIL: Well, Dr. Relman in Boston, Mr. McNaughten in Nashville, thank you both for joining us. Jim?

LEHRER: A reminder on the major stories of the day before we go: President Reagan says the fighting is over in Grenada, mission accomplished, the U.S. troops will be gone within a few days.

Seventy Cubans, Libyan and Soviet diplomats were expelled from Grenada today.

Otherwise, Lebanon's leaders meeting in Geneva want President Amin Gemayel to travel to Washington. They are looking for a way out of the U.S. -sponsored Israeli-Lebanese troop withdrawal agreements. That problem and others will now be the concern of former defense secretary Donald Rumsfeld; he is the new U.S. negotiator for the Middle East.

Jesse Jackson is running for president; Greyhound buses have stopped running because of a strike; while Chrysler faces another new financil problem because of its own strike.

There's also an unusual weather item tonight. It's from Moscow: in one three-hour period Wednesday afternoon, the Russian capital city was hit with squalls, lightning, hail, snow and freezing rain. But today the sky was clear, the sun was out and the temperature was 39 degrees. Pravda, the Communist Party newspaper, said there hadn't been such freakish weather in November for 100 years. Pravda, for a change, also did not blame it all on the United States.

Good night, Robin.

MacNEIL: Good night, Jim. That's all for tonight. We'll be back tomorrow. I'm Robert MacNeil. Good night.