The MacNeil/Lehrer NewsHour

MR. MacNeil: Good evening. Leading the news this Wednesday, President Bush said he hopes to sign a nuclear arms agreement with the Soviet Union at a Moscow summit in February. He also granted the Soviets an emergency aid package, including trade benefits. We'll have details in our News Summary in a moment. Judy Woodruff's in Washington tonight. Judy.

MS. WOODRUFF: After the News Summary, we look at the new U.S. move to step up trade with the Soviets. For a picture of how bad the Soviet food shortage is we talk with Time Magazine Correspondent James Carney in Moscow, then hear three experts debate just how much help the U.S. should be giving the Soviets. Next, the Polish fears of Soviet immigration. Finally, the rags to riches story of New Orleans singing Neville Brothers.NEWS SUMMARY

MR. MacNeil: President Bush announced that he and Soviet President Gorbachev will hold their next summit in Moscow February 11th to 13th. He said he hoped to sign a strategic arms limitation treaty at that meeting. The so-called "START Treaty" would cut long range nuclear weapons. The announcement came after a meeting with Soviet Foreign Minister Eduard Shevardnadze. Mr. Bush also offered the Soviet Union help with its food emergency. He said he would temporarily waive trade restrictions and grant the Soviets up to a billion dollars in credits to buy U.S. farm products. The U.S. will also provide medical supplies and assistance with food distribution. The President appeared with Shevardnadze and Sec. of State Baker in the White House Rose Garden and explained the goals of the aid package.

PRES. BUSH: I want perestroika to succeed. The Soviet Union is facing tough times, difficult times, but I believe that this is a good reason to act now in order to help stay the course of democratization and to undertake market reforms. The United States has an interest in the Soviet Union able to play a role as a full and prosperous member of the international community of states and I am hopeful that these initiatives will further that goal.

MR. MacNeil: The trade restrictions were part of the Jackson- Vannic Amendment passed by Congress in 1974. It withheld trade privileges until the Soviets permitted free emigration, particularly of Jews who had been refused exit permits. Shevardnadze said today's announcements marked a very new phase of relations. Both he and Sec. of State Baker said the steps should not be seen as a payoff for Soviet cooperation on the Persian Gulf crisis. Judy.

MS. WOODRUFF: It was a busy day of diplomacy for the Soviet foreign minister. Shevardnadze met with Israeli Prime Minister Yitzhak Shamir late this afternoon. Top on their agenda was the emigration of Soviet Jews to Israel. In a Washington speech this morning, Shamir said his country's relations with the Soviet Union were becoming closer every day. The Soviet foreign minister also focused his attention on the civil war in Angola. He met with the U.S.-backed rebel leader Jonah Savimby. The Soviet Union has provided arms to the Angolan government for more than a decade, while the U.S. began arming Savimby's rebels in 1986. Also this morning, Sec. of State Baker met with the foreign minister of the Soviet-backed government. Baker and Shevardnadze are trying to find a solution to the 15 year war.

MR. MacNeil: Saddam Hussein today replaced his aging defense minister with a top commander of the Iran-Iraq War. No reason was given. The announcement was made as Saddam met with Algeria's president, Shadli Ben-Jadi, who is trying to reopen contacts between Saddam and the Arab governments aligned against him. Iraq today also ordered all building owners to set up bomb shelters. Japan and Germany today denied that they're not paying all they pledged to the Gulf operation. They had promised to contribute more than $3 billion between them. Yesterday the Pentagon accused them of paying only 1/5 of that.

MS. WOODRUFF: There was a big train crash in Boston today. An Amtrak train from Washington derailed in the underground Back Bay Station and smashed into a local commuter train during morning rush hour. More than 250 people were injured, 10 of them seriously. The crash caused a fuel spill which caught fire, filling the station with smoke. It is not clear what caused the Amtrak train to derail. There was an almost identical crash between an Amtrak train and a commuter train in the same station three years ago.

MR. MacNeil: The Secretary of Education, Lauro Cavazos, resigned today after four years in office. Cavazos was the first Hispanic- American ever to serve in the cabinet. He was appointed by President Reagan. No reason was given for the resignation, but the Associated Press cites one White House source as saying he was fired. Other administration sources said he left because he was tired of being criticized by Chief of Staff John Sununu. Cavazos is the second Bush cabinet member to resign. Labor Sec. Elizabeth Dole left her post in October.

MS. WOODRUFF: In South Africa, African National Congress Leader Nelson Mandela and his rival, Zulu Chief Gocha Buthelesi, visited the site of some of the worst fighting between their two factions, Tacoza Township. We have a report narrated by Roderick Pratt of Worldwide Television News.

MR. PRATT: Zulu Chief Buthelesi and South Africa's law and order minister, Adrian Ploch, flew into Tacoza by helicopter. Security was tight for their tour of the township near Johannesburg, shattered by some of the worst factional clashes this year. Now a tense calm prevailed. They toured the township in an armored personnel carrier. Inkatha supporters turned out to greet Buthelesi in strength, carrying traditional weapons. A massive operation mounted by the police and army is maintaining a fragile peace. Road blocks kept ANC and Inkatha supporters apart and no fighting has been reported since Monday's running street battles that claimed more than 100 lives. But the government says it hasn't got enough men to contain another outbreak. Ploch says he's shocked by the intensity of the violence; while Buthelesi said the followers of Inkatha would defend themselves if they have to, he added that the violence should stop. A little way apart, Nelson Mandela and his wife inspected a squatter camp alongside Tacoza. But Tacoza's deep divisions emerged later with Mandela's motorcade getting a hostile reception as it passed a Zulu migrant workers hostel. The ANC group quickly chose another route.

MS. WOODRUFF: The U.S. ambassador to South Africa accompanied the Mandela group into Tecoza. He said he was shocked and saddened by the violence. The last Eastern European nation controlled by Communists made a major change today. Albania established its first non-Communist political party. Tens of thousands of people celebrated the announcement in the streets of the capital. The government agreed to allow independent parties following several days of student demonstrations.

MR. MacNeil: In Brazil, the Chico Mendez murder trial had a surprise ending. Mendez was the country's best known environmental activist and spent his life trying to protect the Brazilian rain forest from developers and ranchers who want to cut it down. The man accused of his murder pleaded guilty today after repeatedly denying it. His father, who is a rancher, was with him in court. He's charged with plotting the murder. The alleged leader of America's most powerful mob family, John Gati, pleaded not guilty today to ordering the murder of his predecessor. The FBI arrested Gati last night at his social club in New York's little Italy. He's already been acquitted three other times on charges related to his alleged mob activities.

MS. WOODRUFF: That's it for our summary of the day's top stories. Just ahead on the NewsHour, a look at Moscow's need for food aid, Polish concerns about Soviet emigration, and the rhythm & blues success story of the Neville Brothers. FOCUS - CARE PACKAGE

MR. MacNeil: We devote much of the rest of the program tonight to the latest steps in U.S.-Soviet cooperation, especially on the question of helping the Soviet Union feed its people. Today's announcements that the U.S. would reverse policy and provide new economic aid to the Soviets came amid reports of growing food shortages in that country, especially in such major cities as Moscow and Leningrad. Several European nations have already announced major food aid programs. Today at the White House Soviet Foreign Minister Eduard Shevardnadze and Sec. of State Baker met with reporters and explained the reasoning behind the administration's decision to ease the Jackson-Vannic Amendment's trade restrictions.

SEC. BAKER: We have received assurances from the minister and the government of the Soviet Union that the pattern of immigration that has pertained over the past months and even years where there has been a great increase in the ability of people to emigrate from the Soviet Union will be maintained and will be continued. Let me make sure that everyone understands here we're talking about a waiver of Jackson-Vannic that permits the Soviet Union to purchase from private sources in the United States food products, primarily grains, which -- the repayment of which will be guaranteed by the United States government. This is not the equivalent of the granting of most favored nations trading status. That, of course, has not been done. And that makes the conclusion of a trade agreement.

MR. SHEVARDNADZE: [Speaking through Interpreter] Let me express my gratification and my appreciation to the people of the United States, to the President and the Sec. of State for the support of your country at this very difficult time for us. The fact that there is certain instability in the Soviet Union and that we are worried about that, that's a fact. But I will not say that we are on the verge of a civil war; I have no doubt we'll cope with their problems. I would like to support what the President has just said and that is it is up to the Soviet people, above all, it is up to the Soviet people to cope with our problems.

SEC. BAKER: Let me simply say that instability in the Soviet Union is very definitely not, in my view, in the interest of the United States of America and instability in the Soviet Union is not, in my view at least, in the interest of the world.

MR. SHEVARDNADZE: [Speaking through Interpreter] Let me add something to what the Secretary has said. It would be a terrible thing if we were unable to assure the stability of the USSR. It would be a terrible thing for Europe and for the world. It would mean negating the very important treaties signed in Paris, the historic treaties signed in Paris. Let me assure that we're aware of our responsibility to our people and to the world.

MR. MacNeil: We turn now to the food story and the debate in this country of the goals and means of American aid to the Soviets. We start with the actual food situation in the Soviet Union and for that we turn to Times Magazines Moscow Correspondent James Carney. I spoke with him yesterday and we have added some pictures provided by Time Magazine. Jay Carney thank you forjoining us, Describe the Soviet food situation as you understand it to be at the moment?

MR. CARNEY: Well it varies in different regions of the country right now. Strangely enough Moscow and Leningrad the two largest cities in the Soviet Union seem to be suffering the most from food shortages that have created lines that stretch throughout the city streets. In other regions there are reports of fairly plentiful stocks in stores again by Soviet standards. But it is really in Moscow and Leningrad and several other regions where the shortages that you hear about in the West are the most severe. And the shortages include staple items like matches, soap, meat, all sorts of vegetables. Procuring any kind of basis stable food right now or consumer good is an incredible hassle for the average Soviet citizen.

MR. MacNeil: Why particularly Moscow and Leningrad?

MR. CARNEY: In Leningrad were the places where Soviet citizens were best supplied and where Soviets from the surrounding areas would travel in for day trips to shop. As you know certainly the cities of both Moscow and Leningrad are led politically by pro reformers. Very liberal in the Soviet jargon, liberal democrats. Some people speculate that from that end of the political spectrum that these councils, city councils are suffering from sabotage, from Communist Party hardliners who run distribution centers, from regional party leaders who are holding back on supplies. In fact, I believe, last week or the week before something like 8 out of 10 milk suppliers to Moscow suddenly decided to stop supplying milk to the city. I think that decision has been changed but it led some people to believe that some kind of sabotage was at work to undermine the legitimacy of these democratically elected city councils.

MR. MacNeil: You refereed to reports in the West. Do you think that the reports that we have been reading are exaggerated about how dire the situation in the Soviet Union?

MR. CARNEY: Well I think that both the reports that you have been reading and the reports that you have been watching on television have been somewhat exaggerated. There is no famine in the Soviet Union right now. Even President Gorbachev and some of his opponents on both the left and right will tell you that there is no famine and many don't foresee a famine or serious hunger in the coming winter. What has happened is that supplies of basic foods have become so difficult to obtain that the fact that people have to spend so much time trying to get them has added to the disruption of the economy. Absenteeism is up largely because people are spending so much time looking for food. The black market is fluorescing because goods are being filtered away from State supplies and finding a place on the black market. So the system itself is breaking down causing all sorts of shortages, spot shortages and wide spread shortages and leading to this talk of hunger. Another factor is that reporter tend to look at the Soviet shelves and they are empty, There is no doubt about that. But the problem is that is not the only source of food in the Soviet Union. Many workers receive food order shipments through their jobs. There are the ruble markets which are incredibly expensive but many Soviets can afford those because there is a surpluses of rubles in the country and the economy at large right now.

MR. MacNeil: So when a Soviet citizen woman or man spends hours waiting at a state shop for food do they eventually get food at the end of a day?

MR. CARNEY: Well they do for the most part. There are frustrating experiences when people wait in lines only to get to the front and to be told that the supplies have run out. But they do get food. Another situation that occurs is that in some shops only a handful of the item in supply is presented in the store front and some selling items are brought out as the shoppers enter the stores. Again this is not to create the impression that there isn't an economic problem here and there aren't shortages but people for the most part are being fed. I would like to raise another issue and that is that there are some sub groups among Soviet Society that are going to be particularly hard hit and who in some cases are suffering and those in particular are pensioners who receive an average of 70 to 75 rubles a week. If they don't live with families who help take care of them these pensioners have to rely on state stores. The state stores are generally under supplied or not supplied and they can't afford to go to the markets which are remarkably expensive. For example a kilogram of reasonably good meat might cost 30 rubles and that is half of a pensioners salary for the month.

MR. MacNeil: For the fully employed and better off Soviet workers is the situation beginning to drive them in to those private markets?

MR. CARNEY: I think it is to some extent. The markets are quite expensive as I have told you. They have been accused by angry Soviet citizens of being controlled by black marketeers or mafias who artificially drive up prices. And so there is a great deal of score heaped on these markets. So the patronage is increasing but with a great deal of resentment.

MR. MacNeil: And how much is the situation aggravated by individual citizens just buying out of panic that there won't be food this winter and hording it?

MR. CARNEY: Well I am glad you raised that point because early in this year the Soviet Government in one of its many proposed economic plans announced that there would be serious increases on consumer goods prices and food prices. That caused a run on the stores and throughout the summer there have been announcements of forth coming increases in grain purchasing prices or in livestock purchasing prices. Instead of creating an incentive for farmers and live stock raisers to produce more that caused some of them to hold back on selling their goods until the price rises went into effect helping to create the current shortfall. But at the individual level the hording has been pretty substantial. I think that a number of Soviets that I know have stocked their kitchen from ceiling to floor with good that are now in short supply in Soviet stores.

MR. MacNeil: HOw badly does the Soviet Union need Western food right now?

MR. CARNEY: I really don't think, and I don't think that I am alone in this, I don't think that the Soviet Union is desperately in need of Western food now. If there is going to be a crisis and there,very well could be it may rise at the end of the winter when the existing supplies run short because they are shorter than they should be at this time of the year. I think that there are some cases certainly in the cities of pensioners that are desperate for some sort of aid and if the German food aid program distributed through the Red Cross has addressed some of those needs in Leningrad and Moscow. Although it is by an individual by individual basis. I think that by supplying food now it may simply exacerbate the problem in the long run unless the West is prepared to continue delivering food aid throughout the winter and in to the Spring.

MR. MacNeil: Has there been any talk or commentary on what seems the extraordinary irony who besieged Leningrad all those months during World War II and nearly starved its population out of existence now providing food aid to leningrad?

MR. CARNEY: I think that there is a certain sense of shame among some Soviets that the situation has come to this. In Leningrad there was a touching moment that was broadcast on Soviet television nationwide where war veterans were receiving care packages from Germany sort of shaking their heads and some of them crying and muttering about the shame of the situation. So I think there is a irony there but it certainly doesn't stop the Soviet Government from accepting the aid where they see they need it.

MR. MacNeil: Well Jay Carney thank you for joining us.

MR. CARNEY: My pleasure.

MR. MacNeil: Now three views from here. Dwayne Andreas is chief executive officer for Archer-Daniels-Midland, an agricultural manufacturer. He's also the former chairman of the US-USSR Trade Council. Roger Robinson was on the National Security Council's staff during the Reagan administration. He's now a consultant. Padma Desai is a professor of economics at Columbia University and has written extensively about perestroika. Do you want to add anything about the food situation as you understand it in the Soviet Union?

PROF. DESAI: Yes, it was a very extensive report, very detailed, and I think also very balanced. I just wanted to make a couple of footnotes, one of which is the special situation of Leningrad, just as the special situation of Moscow. Leningrad got much of its food supplies and supplies of produce cut off because the Baltics decided to go their own way and that's why Leningrad's food situation has been aggravated. The other point which I noticed was that the Communist uppers may be trying to de-stabilize the radical reformist administrations in the cities of Moscow and Leningrad. I also heard about it last week when I was in Moscow, and it seems to me that probably one needs to emphasize that Mr. Gorbachev would on his own part like to support the city administrations and help them with the very trying food situation.

MR. MacNeil: The KGB issued, in fact, a public warning yesterday --

PROF. DESAI: Yes.

MR. MacNeil: -- against people trying to sabotage that. Do you want to add anything, Mr. Andreas, to the -- as you understand it - - the need or the difficulty there?

MR. ANDREAS: Yes. I think if we're going to talk about the relevance of this solution, we need to be sure we understand the problem. Now the problem really began when Rishkov and Gorbachev 18 months ago started talking publicly about a market economy. This caused a bit of panic to move all the way across the country from producers to consumers and caused a tremendous wave of hording, which the gentleman mentioned. But the cause of the hording was the fear of the oncoming market economy. They were fearful that prices would double and triple. So the farmers held back everything instead of shipping to Moscow. Now they used to shoot them if they didn't ship to Moscow. They don't do that anymore. They have freedom to keep their goods. So they're keeping their goods at home in the republics. Now that wave of hording finally reached the consumers and the housewives started to horde. The refrigerators, my experience is and I've been there a number of times, the refrigerators and the pantries are loaded.

MR. MacNeil: We've even seen pictures because the weather is cold of huge sacks of stuff outside the windows.

MR. ANDREAS: There's no question about it. A housewife goes in and instead of taking one loaf at bread at 8 in the morning, she takes 5, and sells the other 4 to her neighbors. There's a black market among the people as well as among some of the merchants.

MR. MacNeil: Do you want to add anything to the actual food situation in the Soviet Union to what we've heard?

MR. ROBINSON: Well, I agree with much of J. Carney's report. I think it's very important to recognize that there is a kind of economic civil war underway in the Soviet Union already between the reformist republics and the Central authorities. We are in the situation where the Soviet Union has turned away from systemic economic reform, privatization, the right of private property, a number of those things that would have improved the agricultural productivity considerably and broken some of those bottlenecks in the distribution transportation system. So when we talk about presidential decrees of Mr. Gorbachev, they are draconian in nature these days, they are moving toward a more repressive tone, and I think it's something we need to be concerned about when we're planning large scale assistance to Moscow Central Authorities and not carefully crafted and targeted to the democratic forces and their respective republics in the USSR.

MR. MacNeil: Okay. Well, let's -- Mr. Andreas, let's turn to what the President announced today. In view of the situation, what's your reaction to the temporary suspension until next summer of Jackson-Vannic and granting credits? Is a billion dollars enough?

MR. ANDREAS: No, it isn't enough. But I don't think that's important. I think the important thing is that they are now eligible for credit and it can be a billion, it should be 3 or 4 billion, but it's customary to dish it out a little bit at a time, and I think that's to be expected. One year's suspension works. Now what the Soviets really want to do is to build up their visible inventories in the country, inventories of food, so as to put downward pressure on prices so they can take another major step toward a market economy. That's their objective and Mr. Ominsky, who is Shevardnadze's economic deputy, explained to me that that's what they will do with this food that they buy on credit, is rebuild their inventories and put food in the show windows so as to put, to try to eliminate the black market.

MR. MacNeil: So you're in favor of this?

MR. ANDREAS: I'm very much in favor of it. I want to tell you one very important thing that happened just in recent hours. This came on my private wire from Tass Agency in Moscow. It was announced that the Russian parliament today voted to sign a new treaty with the union. The speakers of the parliament overwhelmingly insisted that Russia, that's the big republic, would stay in the union of sovereign Soviet republics, which is the new name they're going to use. It also said that this, that they agreed that Gorbachev and the central government would still have control of a great many of the raw materials such as oil and gold, diamonds, and so forth. This means that tomorrow the Soviet Union's credit will be far better than it was yesterday.

MR. MacNeil: And dealing with the central authority is the smart thing for the United States to do? Is that the inference to draw from that?

MR. ANDREAS: Well, I think considering that they have thousands of atomic weapons and such a big army and everything, we're far better off if they control all of those things for Moscow.

MR. MacNeil: Your comment on Bush's announcement today and your reaction to that, because you have some doubts about that.

MR. ROBINSON: Well, I do, Robin. I think we have to go back and look at the track record and review the bidding on what a waiver of Jackson-Vannic is really all about. As we know, the Jackson- Vannic Amendment was going to be [a] the precondition to any waiver was to be the codification of the right of emigration for all Soviet citizens. That is an institutionalized, legally protected right.

MR. MacNeil: Meaning the Soviet parliament had to pass it and they haven't yet?

MR. ROBINSON: That's correct. And Gorbachev promised for many months to do that. We went ahead and abandoned that critical precondition that was so important to freedom, the bid for freedom in Eastern Europe, and I was quite surprised by that, very frankly. As late as July of this year, the President at the Houston economic summit made three new preconditions to any large scale U.S. taxpayer assistance to Moscow. They were sharp reductions in military spending, which is now some 20 percent of gross national product of the USSR. That certainly has not occurred. Second, the tremendous assistance, billion dollars annually to Cuba, Vietnam, and a host of client states across the globe was to be ceased or sharply curtailed. That too has been very slow off the mark. And finally, and most importantly, systemic economic reform was to be in place. In my judgment, there hasn't been any significant progress toward truly systemic economic reform and when we, therefore, go ahead and make U.S. taxpayers now liable, when Mr. Andreas and his company is able to transfer the risk of doing business in the Soviet Union from his shareholders onto the shoulders of the American people in an unreformed command economy, we're looking for the kind of losses that we took in Poland in the late 1970s which resulted in 2.4 billion in losses for the American people.

MR. MacNeil: But in view of what Sec. Baker said, we just heard him, that instability in the Soviet Union is not in the U.S. interest and Shevardnadze said there is instability and we're worried about it, isn't it smart six months later to weaken some of those stands in order to shore up the central government with this, with this aid?

MR. ROBINSON: The central government's not having any problem shoring up itself with these draconian new decrees. You mentioned the KGB chief.

MR. MacNeil: Where is the negative in doing what Mr. Bush has done today?

MR. ROBINSON: I think that it's this issue of stability versus freedom is something that the Congress also needs to take a hard look at. We could have -- Lech Walesa and Solidarity were very challenging to stability in Jaruzelski's Poland. Mr. Honecker was seen as someone that needed to be shored up for years and years by the West Germans with massive subsidies, and we saw the decay that resulted and the needless repression continuing. So when we talk about this word stability, when these democratic forces and the republics are making a daily bid for freedom, we have to remember that a certain amount of dynamic and instability is very positive to the bid for freedom within the Soviet Union, itself.

MR. MacNeil: What do you think of what the Bush administration did today, Ms. Desai?

PROF. DESAI: I'm in favor of the Bush administration's announcement. I think, as Mr. Andreas pointed out, this will provide some degree of stability in the short run at least, because the availability of food will send signals to the consumers who are hording food stuffs, to the farms which are hording grain that more is going to be available and this will, therefore, act as a sort of softening impact on their anticipation and expectation of prices.

MR. MacNeil: Would the import of American grain cause the Soviet farmers who are holding onto theirs now to let it go?

PROF. DESAI: Well, $1 billion worth of farm produce and grain may not be enough. I'm sure we'll have to follow this up with subsequent promise of substantial credit financed export of grain to the Soviet Union. But I think we have to also sort of address the issue of why systemic economic reforms are not taking place in the Soviet Union, because the main argument which one keeps on hearing is that unless they initiate these reforms, we must not give them any kind of aid. I think there are several problems there facing Mr. Gorbachev, but one problem which he's trying to handle right now is the union treaty which Mr. Andreas brought up. This is a treaty which is now being circulated to various republics. The Russian republic is right now debating it. When I was in Moscow last week, I heard reports that the Russian republic is likely to adopt, accept that treaty. Now what this treaty will do is that it will define competence of each party, the union and the republics, what is the legislative and legal area.

MR. MacNeil: In other words it's forming a new federation of the Soviet Union.

PROF. DESAI: That's right.

MR. MacNeil: And the republics who all wanted to break away and have now formally -- declared their own sovereignty -- they're now prepared to make a deal for a new kind of union.

PROF. DESAI: That's right. And without signing an acceptance of such a union treaty, I do not think that it would be possible for any of the decrees which Mr. Gorbachev has been issuing, are likely to be implemented by the various --

MR. MacNeil: But how is this connected with food then? What's the relevance of food aid to this political process?

PROF. DESAI: Well, because unless the union treaty sign it, unless the republics are all convinced that this our area of competence, giving powers to the center in other areas of other competence. For example, the whole area of land reform is being given over to the republics and only two weeks ago, the Russian republic passed a land legislation which I think is quite remarkable. As a result of that legislation, every farm family in the collective farm is going to be given entitlement to a plot of land and he and his family can walk out with that plot of land free of any payment at all. If he wants to sell that piece of land, that of course can be done only after 10 years and only to the state and this is a very relevant legislation for the progress of farm production.

MR. MacNeil: Are you saying food aid will speed economic reform?

MR. ANDREAS: I absolutely believe that. And furthermore, I think we have to look at our own selfish interest. This deal will save our taxpayers anywhere from 1 to 3 billion dollars.

MR. MacNeil: How?

MR. ANDREAS: Because our prices have fallen to a 13 year low on wheat. We've lost 95 percent of our corn business with the Soviets, because we're not competitive. Credit is part of the price.

MR. MacNeil: Could I come back to the advantage for Americans in a moment, as you see it, because that's controversial here. I just wanted -- you think and Ms. Desai thinks that helping the European countries and other -- help the Soviets with food will speed their economic reform?

MR. ANDREAS: Absolutely. There's no question in my mind.

MR. MacNeil: You do not think so, or you're doubtful about it?

MR. ROBINSON: No. I definitely am doubtful on that point. I think that it's merely been proven to be the case that when you send large scale assistance, cash, credits, and the like, into an unreformed command economy, as we did again in Poland in the late 1970s prior to Solidarity and the ferment there, we found that it deferred not catalyzed systematic economic reform. Sen. Bill Bradley and a number of others have been eloquent on this point.

MR. MacNeil: What's your --

MR. ANDREAS: This is a different case entirely. This is not a third world country. This is a very rich country with a very temporary problem. And unless they can get food visible in the marketplace, they're not going to be able to go over to a market economy. This is the one thing that'll make it possible for them to free up their markets, in my opinion.

MR. MacNeil: Okay. Now what does it do for the United States? Why does it save us $3 billion?

MR. ANDREAS: The United States guarantees the price for farmers. Let's take corn, for instance. The price of corn is down 50 cents a bushel, 4 billion dollars, because we've had no business from Russia. If that business is now rejuvenated, every 10 cents a bushel that corn goes up saves $600 million for the government, because the government is paying the farmer the difference between their price, the target price, and the market price that he's getting. So 20 cents a bushel would be a billion dollars of saving. Now the same thing is true of wheat. I've made an estimate and I think the savings to the United States will be about $3 billion. And remember --

MR. MacNeil: Just on this $1 billion --

MR. ANDREAS: No, no. It'll be 3 or 4 or 5 billion dollars.

MR. MacNeil: Down the line?

MR. ANDREAS: Before it's over. Down the line.

MR. MacNeil: What about that, Mr. Robinson, that it will save U.S. taxpayers money in price supports?

MR. ROBINSON: I just have a very hard time buying that. For example, the American people are already in the pot, so to speak, or have sustained losses of $500 million since August 1986 supporting wheat subsidies to the Soviet Union. It's not as though we haven't been in the subsidization business already and furthermore, I think that we're really going to face the prospect of serious losses. After all, the Soviets are 4 to 5 billion dollars in arrearages or late payments to Western suppliers across the globe. It's been a more or less permanent condition. They are in a situation where we're going to end up privatizing the profits of the U.S. grain company if the payment is received on time, but socializing the losses, that is, if the Soviets have to reschedule at the end of the three year maturities of Commodity Credit Corporation credits --

MR. MacNeil: In other words, if they pay, the grain companies make a profit; if they fail to pay, the U.S. taxpayer pays.

MR. ROBINSON: We pay.

MR. MacNeil: Is that fair --

MR. ANDREAS: Let me say the farmer is the seller, not the grain company. The grain company does it on a tiny commission, is not involved at all. But let me just say what the gentleman just said, that we subsidize wheat. That's absolutely ridiculous. The subsidies that we pay do not go to the Russians. We've never subsidized one pound of wheat to the Russians. We subsidize the American farmer by paying him more than the world market price. If we don't sell at the world market price, we wouldn't sell one bushel.

MR. MacNeil: I see.

MR. ANDREAS: So it does not go to the Russians. It goes to the farmer.

MR. MacNeil: We haven't time to go into this much further. I just want to ask Ms. Desai finally what impact is $1 billion worth of credits going to have? I mean, we're not the only country selling to the Soviet Union or providing food aid. What dent is that going to make in the problem do you think? Or is it more a psychological dent than political dent?

PROF. DESAI: Yes. I think it will be more of a psychological political dent. It will also probably send signals that more could be coming down the line. I think it also needs to be followed up at the Soviet end with some very proper measures of how whatever we send them is utilized properly. I think it is very necessary for them to introduce a systematic entitlement scheme for their citizens of the kind which have been introduced in the city of Leningrad that every citizen, especially the citizens who live on the margin of poverty get some entitlement of half a dozen important products.

MR. MacNeil: I beg your pardon all of you. I have to stop you there and we have to move on. Ms. Desai, Mr. Robinson, Mr. Andreas, thank you all. Judy. FOCUS - SOVIET EXODUS?

MS. WOODRUFF: The worsening economic situation in the Soviet Union and current moves in the Soviet Parliament to make it easier for Soviet citizens to travel has set off worries in Europe about a new wave of Soviet immigration. As Nik Gowing of Independent Television News reports, some of those most concerned live along the Polish-Soviet border.

MR. GOWING: Dawn this morning at Poland's border with the Soviet Union. Once an internal frontier of the Soviet empire, now the frontline for a looming humanitarian crisis. After two days cuing on the Soviet side, Russians freshen up for the next stage of their arduous journey westwards, their cars weighed down with belongings. The Soviets have yet to remove draconian restrictions on passports and exit visas for foreign travel, but as the economic difficulties deepen in Gorbachev's Russia, increasing numbers of Soviets are finding ways to get the documents they need to travel West to Central Europe, mainly into Poland. At this frontier post, several thousands pass into Poland each day. The volume of traffic is now 10 times what it was in the dark cold war days. The numbers heading West across the border line do not yet make a crisis. Four-fifths of Russians return home within a few days after selling bric-a- brac, earning some hard currency, and stocking up with what they can't buy in Soviet towns and cities. But cues on the Soviet side are lengthening, with waits of three to four days, aggravated by an apparently deliberate Soviet slowdown in processing procedures. Poland and Central Europe are now bracing themselves for the worst if the food and the political crises inside the Soviet Union tumble out of control. The fear in Poland is of what they call the science fiction horror scenario, Soviet border crossings like this overwhelmed by tens of thousands of Soviets, possibly millions. As a newly democratic nation, a signatory to the new freedoms in Europe, Poland has no option but to keep this border open and to let the Russians in. At the Interior Ministry in Warsaw, home of the secret police, the head of the refugee department, Col. Zbigniew Skoczylas, says the dooms day scenario does not yet face Poland. But on his wall are the pressure points he believes will result from a possible massive influx of a million Soviet refugees on Poland's Eastern border this winter. Col. Skocyzlas calls a real threat. His contingency plans remain a secret in the corner. The bottom line is that Poland will not be able to cope.

COLONEL ZBIGNIEW SKOCZYLAS, Head of Interior Ministry Refugee Department: [Speaking through Interpreter] A million people, if we were to provide those people with food and accommodation for a year, that would cost us from 25 to 40 billions. The Polish budget will not support this amount. The whole national budget is 290 billion swartas. We would have to spend almost 1/5 of our budget for the needs of the refugees. That isn't possible.

MR. GOWING: A sizeable number of Russians arriving in Poland are clearly keeping their options open in the event that the worst case scenario becomes reality. Beneath the most visible reminder of Poland's former Soviet connections, they have become the new street hawkers of Central Europe. The Russian flea market expands by the day and so does the number of Russians slow to return home. There is an air of innocent duplicity here, a determination not to reveal true intentions. This man said he came here for the day to do some sightseeing. This man from Minsk said he'd come to Warsaw to see what had changed since his last visit two months ago. And this lady had the same problem as many Russians here. She couldn't find the relatives who'd invited her to Poland. Using former Communist hostels, Poland is suddenly confronting the new realities of freedom. Third world refugees no seek asylum here as once Poles sought asylum in the West. It's all too much for Poland.

REFUGEE: I'm refugee here. I took their food, their money, and they have big difficulty.

MR. GOWING: So now to prevent a human wave sweeping in from the Soviet Union, Poland believes the West must help alleviate the crisis there as the way to avoid creating a new one here. PROFILE - BROTHERS KEEPER

MS. WOODRUFF: Finally tonight the rags to riches story of the singing Neville Brothers. Since the '70s they've had a fairly small, yet devoted following, but their recent success is a popular new album of national television appearances and a tour with Linda Ronstadt have won them new fans. Penny Stallings has our profile. [NEVILLE BROTHERS PERFORMING]

MS. STALLINGS: It's been a long time coming, but it looks like it's finally going to happen for the Neville Brothers, name recognition, high paying gigs and record sales to match their passionate cult following. How long has it taken? Only about 35 years, years of occasional highs and many more low down lows, of heartbreak and struggle, where only the folks back home knew their name. The Nevilles are a legend here in New Orleans, the first family of music, neighborhood heroes. But most people first heard of them when brother Aaron Neville joined forces with Linda Ronstadt. [AWARD CEREMONY]

MS. STALLINGS: Ronstadt's is typical of the reverence in which the Nevilles are held by pop music's elite. For them, they're one of rock's last great causes, pioneers who've paved the way and paid the dues, but never saw the spoils. Struggle has always been a way of life for the Nevilles. They learned to deal with poverty and racism as kids growing up here in the Kalio Projects in New Orleans. But tough as it was, life in this strange and insular Southern city had its compensations.

CHARLES NEVILLE: There's something about just the atmosphere of the city, the fact that there is music happening everywhere in the city all the time and like not only at night, but all day in the streets, or it can, you know, not only the people who are the street performers in the French Quarter may walk by and there are the kids sitting on the porch blowing this trumpet or hear music coming out of any house and somebody practicing.

MS. STALLINGS: The Nevilles are a product of the fabled New Orleans music scene of the late '50s that also launched Prof. Longhair, Fats Domino, Little Richard, Reed Dorsey, Clarence "Frogman" Henry, and Huey "Piano" Smith. Things first began to happen for them in the early '60s, for Art with local bands, for Charles as a session man. Aaron was scoring hits with a local record label, but it wasn't enough to keep him and his family alive.

AARON NEVILLE: Well, I wasn't makin' a living playing music. I was makin' a living drivin' a truck or paintin' a house or freight houndin', or workin' on the riverfront, something like that, you know.

MS. STALLINGS: In fact, Aaron Neville was loading freight when he first got word that a song he'd recorded, "Tell It Like It Is", was on the charts. But though that record would sell in the millions, it meant little to him. While the fat cats got fatter, Aaron went back to the docks.

AARON NEVILLE: I think sometimes I'd be workin' on the river and I'd be on a ship singin' and someone would say you shouldn't be in the ship hold, you're supposed to be up there with so and so, I said, no, man, I got to be in the ship hold, I've got a family to take care of you know. I said, when it's time for me to get out of the ship hold, I'll be up there.

CHARLES NEVILLE: And by the time I was 16 I had a family too. I had kids, so working, working all day, playing music all night, and gambling I was, I learned from some guys who were gamblers about little different tricks, the cards, and the dice, that would take some of the chance out of the game of chance. But then there was the bigger chance of getting caught actually.

MS. STALLINGS: The brothers' games got a little too stick for the state. Aaron ended up doing time for car theft, Charles for marijuana possession, his sentence typical of Louisiana justice at the time.

CHARLES NEVILLE: Oh, five years of hard labor for possession of two joints, yeah.

MS. STALLINGS: Unfair as it may have been, prison was a turning point for Charles. In-between digging ditches and cutting sugar cane, he nailed down his craft.

CHARLES NEVILLE: One of the best things that came out of the period that I spent locked up was I got to practice. I got to spend about 2 1/2 years with nothing to do every day. Well, I worked first in the field for a while, then I got a job teaching music, and that left me in the music room every day from 7 to 4 and then from 6 to 8 with nothing to do but practice, because the students were out working in the field, so I didn't have to do anything but that. So by the time I, when I moved to New York in '67, I got released from prison down here in '67, paroled to New York, I could play with anybody and play anything because I'd been practicing eight hours a day for two and a half years.

MS. STALLINGS: In 1977, the brothers came together in a recording studio for the first time at the urging of their Uncle Jolly, the rascally charming George Landry was a neighborhood legend, longshoreman by day and big chief of the Wild Chopotunas, the mardi gras in the 13th ward by night.

CHARLES NEVILLE: He wanted to get his version of those traditional songs on record and he wanted us to do it with him and maybe he had been thinking this before we did it, but when we were in the studio, he reminded us, you know, having all four of you together like this is something your parents always wanted to see. Well, it sure would be a good idea, and maybe that's what's needed for you guys to really do something big is to do it together.

MS. STALLINGS: Jolly was on to something. The Nevilles' first joint venture became a cult sensation. Several more albums followed, but never the long awaited breakthrough. This time it wasn'trecord company double dealing that did them in, but their very uniqueness.

CHARLES NEVILLE: The reason it didn't get air play was because there are these radio categories and it didn't fit any of those categories and so the program directors said, well, can't program that as black rock, can't program it as pop, you can't program it as, they didn't know what to program it as so they didn't program it.

MS. STALLINGS: That's been a blessing to the Nevilles in some ways, because their sound has never been compromised, a fabulous melange spending generations in idioms, not to mention four very distinct talents. Charles, an avant garde jazz virtuoso with the soul of a poet; Art, the gravely voiced senior member, the founding force behind the meters, Syril, the youngest and most political, and Aaron, whose golden voice can be ultimately sexy and insinuating or reverent and chaste. The Neville Brothers have been able to keep going because the family was so close and it's family that continues to hold the group together. No, the backstage action at a Nevilles concert isn't exactly what you'd call a super star's scene. They're still the same unassuming guys who live in New Orleans, some in the same neighborhood.

CHARLES NEVILLE: We still perform for the same reason as when we first began. That's because we love to do it and it allows us to express ourselves and we're going to do that. We don't like put on a contrived performance. We just go out and do what we do and so the music comes through really with that emotional impact.

MS. STALLINGS: Yes, it seems like it's finally going to happen for the Nevilles. True, as men in their forties and fifties, they're a bit, well, mature to be rock stars, but no matter what, the Nevilles will always be an institution here in their hometown. And it's here to New Orleans they'll always return, play for the folks who knew them well. RECAP

MR. MacNeil: Again, Wednesday's top stories, President Bush said he hopes to sign a nuclear arms agreement with the Soviet Union at a Moscow summit in February. He also decided temporarily to lift trade restrictions to allow the Soviet Union to buy a billion dollars of U.S. food on credit. Good night, Judy.

MS. WOODRUFF: Good night, Robin. That's our NewsHour for tonight. We'll be back tomorrow night. I'm Judy Woodruff. Thank you and have a good night.