The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight: A summary of today's news, a look at the announcement of new post- Enron accounting rules, a talk with the new man in charge of air travel security, a Newsmaker interview with the prime minister of turkey, and a Roger Rosenblatt essay about what goes on in the mind of a writer.

NEWS SUMMARY

JIM LEHRER: A hand grenade tack killed five people and wounded more than 30 in Israel today. It happened in a wedding hall in northern Israel. The Palestinian attacker was among the dead. Army radios said the man tried to blow himself up but security guards stopped him. He still managed to throw hand grenades. A Palestinian militia group said it was revenge fire bombing this week that killed its leader. The head of the Securities & Exchange Commission called today for tough controls of the accounting profession. Harry Pitts said the Enron Company exposed need; he said an independent body should be created to oversee and investigate accounting practices. The SEC is investigating Enron's bankruptcy and the role played by its auditor, Arthur Andersen. We'll have more on this story in just a few minutes. The Justice Department today released photos and video of five suspected al-Qaida members. The videotapes were found in Afghanistan. Four of the suspects have been tentatively identified but their whereabouts are unknown. In Washington Attorney General Ashcroft said investigators were still translating the tapes.

JOHN ASHCROFT: These could be and likely appear to be sort of martyrdom messages from suicide terrorists and whether the attack would be imminent or not is something we can't determine. But we know that the right time to release these is in advance of any attack if there is to be an attack not subsequent to an attack and to try and enlist the people of this great nation and the people around the world to help curtail the attack.

JIM LEHRER: One of the five suspects has been named as an unindicted coconspirator in the September 11 attacks. More Taliban and al-Qaida prisoners arrived today in Guantanamo Bay, Cuba. So far, 110 are in a temporary camp at the U.S. Naval station there. At the pentagon, Defense Secretary Rumsfeld would not say how long they will be held. He did say some will face military tribunals or U.S. civilian courts, and some may be tried in their home countries. He said others may be imprisoned much longer.

DONALD RUMSFELD: It's conceivable some could be kept in detention for a period, while additional intelligence information is gathered, for if they simply are dangerous and there is no question there are a number down in Guantanamo Bay who every time anyone walks by threaten to kill Americans the first chance they get -- these are quite dangerous people. They may just be kept in detention for a period.

JIM LEHRER: Military officials also said representatives of the international Red Cross were set to meet with the prisoners. That came amid new questions about their status and treatment. The U.N. Secretary-General said, through a spokesman, they should have all the rights of prisoners of war. Instead, the U.S. Has labeled them "unlawful combatants." In London, Britain's Foreign Secretary said the U.S. must make sure they are treated humanely. Secretary of State Powell made a brief visit to Afghanistan today. He said the United States would keep its promise to help rebuild the country, and get rid of terrorists. In Kabul, he officially reopened the American embassy for the first time since 1989. He said the U.S. would make a "significant" financial commitment to Afghanistan next week, at a conference in Japan. Later in the day, Powell traveled to India. He said tensions with Pakistan had eased considerably. He commended Pakistan's President Musharraf for a crackdown on Islamic militants. And he called for more action to end the month-long standoff along the border in disputed Kashmir. On a visit to Washington, India's defense minister said he believed there would soon be an agreement to defuse the situation.

FOCUS - REWRITING THE RULES

JIM LEHRER: Now, more on today's developments concerning accounting rules and regulations in the Enron case and beyond. Margaret Warner has that.

MARGARET WARNER: This week with revelations continuing to emerge about the collapse of Enron Corporation government investigators focused on how the company managed to hide its losses and debts from the public and the role of the kiting firm that okayed Enron's books. Enron paid that firm Arthur Anderson $52 million last year -- about half for auditing -- the other half for consulting services. Among this week's revelations last February according to Congressional investigators some senior Andersen executives discussed dropping Enron as a client because of concerns about its bookkeeping. In August Enron executive Sherron Watkins warned Enron CEO Kenneth Lay and auditors at Andersen that an elaborate accounting hoax could sink the company.

SHERRON WATKINS, Vice President Corporate Development, Enron: I thought Ken Lay ought to know the facts and look into them.

MARGARET WARNER: In September, Andersen's top man on the Enron account David Duncan - see in the middle -- began overseeing the destruction of thousands of Enron documents. Duncan was fired this week. The Securities & Exchange Commission is responsible for regulating the financial reporting practices of publicly trade companies and the accounting firms that audit them. Today SEC Chairman Harvey Pitt said Enron's failure showed both systems needed fixing.

HARVEY PITT, Chairman, Securities & Exchange Commission: Investors here and abroad are entitled to rely upon our system as the finest in the world. And we at the SEC intend to fulfill that responsibility. This Commission cannot and in any event it will not, tolerate this pattern of growing restatements, audit failures, corporate failures, and then massive investor losses. Somehow we have got to put a stop to a vicious cycle that has now been in evidence for far too many years.

MARGARET WARNER: Pitt proposed that companies be required to disclose financial information to investors more quickly, more clearly and more thoroughly. He also proposed a new private sector oversight panel for the accounting profession with members chosen from inside and outside the field.

HARVEY PITT: The body should be empowered to perform investigations, bring disciplinary proceedings, publicize results, restrict individuals and firms who have failed to meet ethical or competence standards from auditing public companies. The disciplinary proceedings should proceed expeditiously. And, of course all of the disciplinary actions or decisions should be subject to SEC oversight.

MARGARET WARNER: Now to our own discussion of accounting practices and regulation. We're joined by Arthur Levitt, former chairman of the Securities and Exchange Commission in the late 1990s, he pushed, unsuccessfully, to sharply limit accounting firms from serving as consultants to the companies they audit; Donald Langevoort, a former special counsel at the Securities and Exchange Commission, he is now professor of law at the Georgetown University Law Center; and Rick Antle, associate dean and professor of accounting at the Yale School of Management, he has served as a consultant to the so-called big 5 large accounting firms. Welcome gentlemen and Professor Donald Langevoort beginning with you, let's do a little Accounting 101 here -- remind us of the role of the accounting firms, outside accounting firms in this whole system of financial reporting and how essential they are to the reliability of that system.

DONALD LANGEVOORT, Georgetown University Law Center: Well companies do the financial reporting. They gather the numbers, the results of operations and put them together into the financial statements that are required to be disclosed. The temptation, of course, if you're inside the company, is to make your numbers look good, because we know that good earnings push stock prices higher; everyone wants a high stock price. The temptation is there. The job of the auditor is to come in, look over the shoulder of the internal accountants, check their judgments, make sure they gather the right numbers. And then if they're satisfied that the job was right, certify the financial statements as prepared within the rules.

MARGARET WARNER: So do you agree with Harry Pitt that there is something wrong with the system?

DONALD LANGEVOORT: There is something wrong with the system.

MARGARET WARNER: What's wrong?

DONALD LANGEVOORT: It's pretty clear that the pressure on companies to push stock prices high, to get their numbers up to engage in financial cosmetics as it's called has been so strong that it's overwhelmed what's really a very old system of accounting in this country that's based on a principle of conservatism and that pressure has just been like a tidal wave. And the wall -- the sea wall that is accounting just has stood up quite as well as it should.

MARGARET WARNER: Mr. Levitt you were quite critical of this whole system when you were head of the SEC. What is wrong with the accounting, outside auditing end?

ARTHUR LEVITT, Former Chairman, Securities & Exchange Commission: I think that the problem we have is not just the accounting but it's the standard setting, it's the board structure, it's the analysts, the investment bankers, the company itself and I think what's happened in effect is in the competition between the major accounting firms, the power of the client has become so great as a result of huge fees paid for not just the audit but for consulting fees, that more and more instances we see the accountant going along with the company as it tries to state earnings as they would like to see them, the rather than as they are. And the major problem is that the standard setters, in this case of Enron, were not able to come to grips with the kinds of standards to prevent this from happening.

MARGARET WARNER: Wait. Let me interrupt you what do you mean standard setters?

ARTHUR LEVITT: We have an independent standard setter called the FASB, but they're funded by the very companies for whom they provide standards and they are subjected to huge pleasure from corporate America and from the Congress. As a result of this every time they come out with a standard that may be controversial or not to the liking of the business community, they are held up literally for years by a constant series of debate and harassment and threats of legislation. The system has broken down and we must expedite the process of establishing standards. I think Mr. Pitt's suggestion for an oversight body for the accountants is important, but I hope the details will be worked out so that the accountants can't defer the mate findings of this panel, whatever it may be, for years as they have now until other litigation is settled. This question of deferral is a very important one.

MARGARET WARNER: All right. Let me go to Professor Antle and before we debate Harvey Pitt's recommendations, just weigh in on the question whether you think there is something really wrong with the system that needs fixing and addressed the concerns that your two co-panelists here have raised.

RICK ANTLE, Yale School of Management: Well the first thing that comes to my mind is always the liability that auditors face and the market pressures that they have to acquire and service their clients. Let's just talk about their liability for a second. I know one of the large accounting firms recently lost 330 some million dollars in the case. I think that in the Enron situation it's been publicized Arthur Andersen has had to pay $110 million for waste management. So when we talk about more discipline needed I always think about the discipline that the courts provide and that the markets provide but mostly the courts and it's very difficult for me to see how any sort of regulatory body or other body would not be subject to exactly the kind of problem that Mr. Arthur Levitt was concerned about.

MARGARET WARNER: But Professor sorry, but let me interrupt, do you agree or disagree with the point that there is an inherent conflict of interest for instance in the big accounting firms now having consulting contracts as Andersen did with Enron to serve the client in a different way and that their loathe to lose that contract being too enough their auditing.

RICK ANTLE: I don't really view that as a very big problem. Let's take the case of Enron in which Arthur Andersen earned $52 million in fees last year. If you think that was a quarter profit -- that's ten million in profit. I think that the partners of Arthur Andersen would trade the ten million and every other bit of profit they made from Enron the last ten years immediately today to be out from under this situation.

ARTHUR LEVITT: Can I make a point?

MARGARET WARNER: Certainly.

ARTHUR LEVITT: That in any audit there are many, many subjective judgment calls that can be made. If the auditor is being paid a huge consulting fee of $27 million, for instance, is that judgment call likely to favor management or likely to favor the individual investor? It's obvious. The perception of that and the reality of that is that the accountant will go where the money is.

MARGARET WARNER: Professor Langevoort, that is true is it not that a lot of the accounting judgments are judgments... For instance Enron without the specific case they did a lot of creative financing mechanisms shall we say, that there is not an obvious industry standard that says this is verboten, this has to be accounted for this way. There is a question of judgment and therefore, leaves a lot of flexibility?

DONALD LANGEVOORT: That's absolutely right and the pace of innovation as makers have tried to find ways to move risks off balance sheets to fry and find ways the things they don't want disclosed not put there, runs up against these very subjective standards and with that much pressure from management and standards that are sometimes so amorphous, so vague it's tough to ask for a lot of spine from the auditor.

MARGARET WARNER: Mr. Levitt, to you on Harvey Pitts's proposals. Do you think that this kind of a new board, an oversight board will be any more effective at auditing the auditors which I think was the headline of your op/ed in the "New York Times" today, than the previous systems, because there are a lot of other bodies already involved including the SEC?

ARTHUR LEVITT: I think this is a first rate initial step, but a lot has to follow and the details are terribly important in this question of deferral I think it particularly....

MARGARET WARNER: I'm sorry. Explain the question of deferral.

ARTHUR LEVITT: Well, right now if an action is brought by the AICPA, which is the trade group representing the accountants an individual firm can defer that action while other cases are being heard and as a result of that the matter can go on for many years. Under the new proposal of the SEC this group that is formed would be allowed to at least do the investigation before the deferral kicked in but as I understand it the final finding of this group could be deferred by deferral for some period of time. And I think that's one of the details that have to be worked out.

MARGARET WARNER: Professor Antle what do you think of this idea of having another regulatory body, apparently or purportedly a tougher one that existed to date -- do you think it's needed?

RICK ANTLE: Well yeah I think it's fine. As some of the critics pointed out I think the AICPA and other bodies that discipline accountants have had a difficult time I think in large part because the court and litigation are always hanging over their heads. So don't really understand how we'll make a set of rules that will work that will preempt what might happen in the courts or do anything much faster than they're going to do.

MARGARET WARNER: Is your point that the AICPA has been reluctant to discipline accounting firms because there is this threat of lawsuits out there?

RICK ANTLE: Absolutely one of two case could occur. One they could discipline their members. If there is currently a civil trial going on the next day in court I'm sure that will be introduced as evidence or some sort of point for the plaintiffs. On the other hand,...

ARTHUR LEVITT: The AICPA is the cheerleader for the kiting profession. This group has got to be totally independent. The AICPA is simply inadequate to providing this kind of discipline and never have.

RICK ANTLE: You think you're going to set up some body that's going to be better or they are going to have subpoena power or are they going to basically do what the court will do or faster? I don't understand how this is supposed to work.

ARTHUR LEVITT: I think Mr. Pitt's proposal calls for a group which will have investigative power and be able to bring their findings to the attention of the public -- something that the AICPA failed to do. I think disclosure is one of the best ways to resolve this and it's something that the AICPA kept hidden in the back room. They were totally inadequate to this task.

MARGARET WARNER: Professor Donald Langevoort what do you think are the prospects for Mr. Pitt to even get this proposal... This is just a proposal. He told Congress he wants to hear from them. What do you see on the prospects here?

DONALD LANGEVOORT: Oh, I think something will half. The momentum has been building fire long time. When the stock market was riding high and people's losses seemed a little less important, you could understand why these kinds of reforms weren't happening as Arthur Levitt told us they should. Today with Enron and a whole litany of failures I think the public pressure to do something in a major way is going to lead to some action.

MARGARET WARNER: Do you think this is the right thing?

DONALD LANGEVOORT: I think it's the first step and I think Harvey Pitt is a very smart good person. I think he's going to engineer this the right way but we're just at the start of a long road.

MARGARET WARNER: Mr. Levitt how do you rate prospects?

ARTHUR LEVITT: I think the prospects are good, the times call for it. I think Harvey Pitt has the experience and strength to fight the enormous opposition he will get from within the industry and probably once again from the Congress. This is very complicated. But I wish him every good fortune in doing it, and it is not merely this committee that's important, it's the standard setters, it's the analysts, it's the investment bankers, and it's the board that has to be strengthened to bring about much greater protections for America's investors and restore confidence in the system.

MARGARET WARNER: And, briefly Mr. Arthur Levitt he's not calling for baring the accounting firms from doing the accounting as you originally proposed; does that bother you?

ARTHUR LEVITT: Well, I think you can only do so much at one time. I certainly believe that this clearly represents a conflicted demonstrated in this Enron case and I would hope that the Commission gets to that as they move forward with various programs to help reassure the public.

MARGARET WARNER: Professor Antle very briefly do you agree with Mr. Arthur Levitt that the accounting industry will probably oppose some of this?

RICK ANTLE: No. I think they have already come now the favor of revised governance procedures and they've actually had a record of improving financial reporting in auditing. And I think Mr. Arthur Levitt saying that it's... The Enron case is proof that somehow consulting taints auditing; I don't think we have shown that. But I think for improved governance I think there's going to be a lot of support and I think the details are going to be difficult to work out but I think it will get done.

MARGARET WARNER: All right, gentlemen, thank you all three, very much.

UPDATE - SECURING THE SKIES

JIM LEHRER: Still to come on the NewsHour tonight: An air security deadline, the prime minister of Turkey, and a Roger Rosenblatt essay.

JIM LEHRER: Ray Suarez has the air security story.

RAY SUAREZ: In November, two months after four hijacked jets were involved in the September 11 terrorism attacks, Congress passed a law mandating a series of aviation security improvements. The first major deadline is tomorrow, when all checked bags must be screened before being loaded onto the airplane. Airlines will have a number of options to choose from, which include: Using explosive detection machines, using bomb- sniffing dogs, increasing hand searches by security officers, and so-called bag-matching, by which every bag is matched to an actual passenger on the plane. The new law also creates a new federal agency to oversee airline security. Its first chief, John Magaw, is with us now for a newsmaker interview.

JOHN MAGAW, Transportation Security Administration: Thank you, Ray.

RAY SUAREZ: Are you going to make the deadline? Will every bag getting on a plane tomorrow be screened in some way?

JOHN MAGAW: It will; the bags will be screened in one way or another we're going to meet the law, the airlines and those employees there will meet the law as prescribed by Congress.

RAY SUAREZ: Now I know that at the end of this road, the in the evening is that all bags will be mechanically screened. Do you with know what portion of the airports in the country will be able to comply with that level of screening or what percentage of the flights tomorrow will be?

JOHN MAGAW: There are less than 170 machines in the country somewhere near a hundred and sixty-one or sixty-two, so that barely scratches the surface when I year from now in order to do all of those we'll need an excess of 2,000.

RAY SUAREZ: So it's the other measures carrying most of the weight tomorrow?

JOHN MAGAW: That's correct; it's the other measures to carry most of the weight but wherever the machines are the explosive detection machines will be used as close to full time as possible.

RAY SUAREZ: So given that we're moving to these other methods all over the country, will the flying public notice a big change tomorrow?

JOHN MAGAW: I don't believe they will notice a big change, because the airlines have been doing some practice sessions for the last couple of weeks, been taking certain flights, and doing the different things that they plan to do. Without any real delays I suppose they'll be scattered places around the country, but we don't expect and I don't believe the airlines either expects it to be a huge delay.

RAY SUAREZ: Now was there some contact between the federal government and the airlines on which mix of methods short of the machines they're going to put in place? Have you been conferring with them along the way since your appointment about what will be done tomorrow?

JOHN MAGAW: We have had since my appointment, I've been in one meeting with the leaders or the airline representatives in some cases it's the CEO, in other cases it's the Vice President, but those that will carry forward. And there was an agreement across the board that within, within their own capabilities which ones will work the best for them and which ones can they do without large delays. And is that as safe of a services as they can perform? And -- but to talk about that would lessen the security. So each one is slightly different.

RAY SUAREZ: Do you feel confident that in every place these alternative measures are being used, that the result will be as safe as electronic screening?

JOHN MAGAW: Well, the way this program is set up by Congress is to take it in steps, so that with what equipment is there and what facilities are there make it as safe as we possibly can. I don't... The actual timeframe is for the full examination is one year. So by that one year point we should have machines and different technical equipment there that by then it will be even better.

RAY SUAREZ: Let's talk a little bit about bag matching. Maybe you could give us a for instance at a big airport, let's say Kansas City International or a Saint Louis, not a major hub but a... Still a sizable airport. How would that be accomplished if you had an airplane going to another major city, a good sized plane?

JOHN MAGAW: Most of the airlines have been doing that internationally for a number of years so they know how do it very well. It's a matter of reprogramming their computer system -- their information systems to do that in the information system, to match those bags.

RAY SUAREZ:: So you would as a passenger give over your bags to the airlines, they would identify them in some way their yours so you can get them at the other end and then before you board you would have to show... Present yourself and match up with your bag once more before you climb the jet way?

JOHN MAGAW: Well the computer does that. As you check in you're registered in and your bag is registered with ticket numbers placed on that bag. And then when you are confirmed at the gate and you put your ticket through that electronic unit at the gate that becomes a bag and passenger match. If you don't go to the gate and get on the plane, they will know that.

RAY SUAREZ: So potentially there could be some delays, some holdups because then you would have to fish a bag out of the system?

JOHN MAGAW: Oh, that happens today. There are some airlines that in this delay have been doing a bag match whenever they could and if they have the capability and yes, if that person is not on there. But it also, my understanding is that on that bag, where they put the ticket where you pick it up at the other end that they stick with the two pieces together that holds on the handle that that bag also has a marking on it, so they will know in what storage area within the plane they're putting it. So they usually just have to go and pull off one of the big cubicles and they'll find it in there. So this isn't a case of where you have to search through hundreds and hundreds of bags. They will be able to tell within a certain number of bags where it's located.

RAY SUAREZ: Some of the critics who have been weighing in on bag matching have talked about how this wouldn't have stopped the September 11 terrorists attacks -- where people are willing to kill themselves, simply having them match up with their bag before it's loaded won't stop them.

JOHN MAGAW: That's correct. It's a piece of the puzzle, a piece of the security. Once you have done the bag match, that's why there are the requirements to do some other checks. Also, there is a program where certain elements are examined, and if some of those elements are not met, then that person is screened two, three, or four times before they ever get to the aircraft in a courteous and professional manner and so this is the first step in what was going to be the full plan completed in a year.

RAY SUAREZ: So if you don't get them with the bag match, it may be some other aspect of the profile that you use it look for people?

JOHN MAGAW: That's correct.

RAY SUAREZ: Now still this is an airline responsibility, because your agency hasn't taken full control of the security system yet. Will you be monitoring along with the airlines through this traveling weekend and maybe Monday get together and see how it's going so far?

JOHN MAGAW: Well, we'll be in contact through the whole weekend to see how it's going but it's very important for the public to realize that no airline, no company that's out there wants something to happen on their aircraft. So the CEO's and the employees all through these companies trying to do everything they can with the assets they have to make it as safe as possible.

RAY SUAREZ: What has to happen during this phase in until February 17 when your agency takes the fullest version of control of the security system, I imagine by the legislation?

JOHN MAGAW: Well there is FAA personnel at each one of these airports so they will be working with the airline people to make it as smooth a changeover as possible come February 17. At the same time, we just finished on schedule putting together a very detailed screeners' training program, and so we're going to begin very quickly. There is 7,500 screener applications that's came in in a very few days. They're going to be paid well, they're going to be a very proud organization, because they're going to be trained well and America is going to be proud of them. Now, that takes time. The -- February 17 we'll take over the contracts. If there are people in there who are not doing what they're supposed to do they'll be relieved and as the new screeners come on board and are completely trained and not only trained, but tested, then as the months go by that force will be completely trained, completely uniformed and federal employees.

RAY SUAREZ: 28,000 that's a big number of employees to ramp up.

JOHN MAGAW: Well you know 28,000 when you talk about 28,000 when that number first came out, those were the screeners and the amount of personnel it takes to screen baggage today. That doesn't count, now, the equipment that we're going to be putting in. The explosive detection equipment -- that takes handlers and it takes professional people running those. So that really is not a number that will end up being accurate in the end.

RAY SUAREZ: Will a lot of the people who are currently doing bag screening at the nation's airport eventually become part of your federal force?

JOHN MAGAW: We're uncertain as to how that number is going to sort out. The fact is, if they meet the requirements, and they go through the training and they pass the testing and then they go through the probationary period, I don't know whether it will be 50%, 60%, whether it will be 65%, but whatever percent qualifies and is dedicated to doing this kind of work is now going to be paid more, and if they meet those requirements, we welcome them to stay. They have some of the history, they have... Know some of the problems that have occurred and they'll help us be better. But obviously if they cannot speak English, if they cannot write in English and can't give someone directions in English that is easily understood, then they can't be in those positions.

RAY SUAREZ: John Magaw thank you for joining us.

JOHN MAGAW: Thank you, sir.

NEWSMAKER

JIM LEHRER: Next, our Newsmaker interview with the prime minister of Turkey. We start with some background from Spencer Michels.

SPENCER MICHELS: Within days of the September 11 attacks, U.S. fighter jets at Incirlik Air Force Base, in southeastern Turkey, went on high alert. The Turkish military also placed its units on alert, just one sign that this strategically- placed country was siding with its long-time ally, the United States. Since the war in Afghanistan began in October, more than 4,000 military flights have passed through Turkish airspace, often taking off from Incirlik. Now, with the war winding down, Turkey has pledged 261 soldiers and six officers for the multinational peacekeeping force. And Turkey has offered to take over command when Britain withdraws its soldiers in three months. Turkey forms a nearly 1,000-mile wide bridge between Europe and the Middle East; among its neighbors: Iraq, Iran and Syria. Turkey was a strong ally of the United States in the Gulf War against Iraq, and U.S. and British planes still use a Turkish base as a launching pad to patrol the no-fly zone. The possibility of a new U.S. war against Iraq has provoked concern in Turkey, in part because of fears that it could lead to the rise of a Kurdish state on the border. Turkey has fought a 15-year war against Kurdish rebels at home. The nation of 68 million people is 99.8% Muslim, but its government has been rigorously secular since the founding of the modern Turkish republic by Mustafa Kemal Atta Turk, in 1923. Women dress in western garb; it's against the law for them to cover their heads in some public buildings. Islamic parties are strictly regulated; Turkey is a rare parliamentary democracy in the region, but the military plays a strong political role. The current prime minister is 76-year-old Bulent Ecevit, a veteran politician who has served in that job four times since 1973. Ecevit arrived in the United States on Monday for a five-day visit. He met with officials of the World Bank and the International Monetary Fund, seeking relief for military debts and assistance for Turkey's faltering economy. At the White House yesterday, President Bush welcomed the prime minister, and praised his efforts in the war against terrorism.

PRESIDENT GEORGE W. BUSH: As a friend, you have been steadfast in your support in the war against terror, and for that, my nation is very grateful. We appreciate your leadership when it comes to foreign policy, and we appreciate your leadership when it comes to economic policy. You and your administration have made some very tough decisions, and the economy is improving as a result of your leadership.

SPENCER MICHELS: Tomorrow, Ecevit is scheduled to travel to New York, where he will visit the World Trade Center site before returning home.

JIM LEHRER: I spoke to the Prime Minister this afternoon at his Washington hotel.

JIM LEHRER: Mr. Prime Minister, welcome.

BULENT ECEVIT, Prime Minister, Turkey: Thank you. It's a great pleasure.

JIM LEHRER: Are you satisfied with the way things are going in Afghanistan?

BULENT ECEVIT: Yes, much better than expected at the early stage. There was expectations that the fights there, the operation there might be extended for several months, even for several years. But within a few weeks it ended, because obviously the Taliban wasn't a real force. The armies, the difference of all of those armies that had been fighting each other and the Taliban took advantage of that to rule over the whole country. But thanks to the efforts, the initiative of the United States and of the several countries from the world, from Europe, including Turkey, it ended within a few weeks. I'm glad to hear that.

JIM LEHRER: And did that surprise you as well as everyone else?

BULENT ECEVIT: Yes, yes, indeed. Of course the problems do not end here. There is, as you know, there is no unified national Afghan army or police force. They have to be rebuilt from scratch. And in fact, I wrote a letter to Mr. Karzai when he took over the task of premiership...

JIM LEHRER: He's running the temporary government now.

BULENT ECEVIT: Yes. I suggested that we had experience in helping other countries build their military forces, and we would be willing and happy to do the same for Afghanistan, together with the United States.

JIM LEHRER: Well, now the United States apparently wants Turkey to kind of run this new... The peacekeeping force eventually, right, and to play a large role in the new... In rebuilding...

BULENT ECEVIT: This is a different arrangement from what explained, but agreement has not yet been reached among countries, which will contribute to the security force. But there are indications that's Turkey might be given this task. Of course we would try fulfill it. But apart from the military measures, security measures, of course, Afghanistan needs great help for building up its social life, its economic life. It has become a very poor country, neglected for many years. We have been helping, trying to help Afghanistan in many ways, even from the beginning of... the beginnings of the '20s, 1920s, when he we were fighting our own national struggle. Atta Turk sent several Turkish staff officers to Afghanistan, helped them build their own army. And even very recently, when Taliban was in office, we took the humanitarian task of building hospital, for instance, schools and other arrangements.

JIM LEHRER: Are you optimistic that Afghanistan can be rebuilt as a stable and peaceful nation?

BULENT ECEVIT: It can be rebuilt if other countries with selfish interests will not meddle, as has been done in the past. If politically Afghanistan is left alone, Afghanistan people is left alone, they will mend their own fences, they will form their own problems. But if too many countries, as has been the case, interfere too much in the internal affairs, the political situation of Afghanistan, then of course we can't hope satisfactory results. But if we leave them alone, just satisfying ourselves with social work, economic work and the building up of a national army, it can make progress, hopefully within a short time.

JIM LEHRER: There has been... There have been many suggestions and even overt threats in this country about the fact that the next step in the war on terrorism should be the overthrow of Saddam Hussein in Iraq. Do you support that?

BULENT ECEVIT: Well, we don't want to interfere in the political of questions of other countries, particularly neighboring countries, it would create serious problems for Turkey. What has been essential for Turkey is that Iraq should not be divided, because that would have adverse effects for Turkey.

JIM LEHRER: You're talking about either -- a division based on the Kurds?

BULENT ECEVIT: That's right, yes.

JIM LEHRER: And then the Kurds in Turkey might unite with Kurds in Iraq and cause a problem?

BULENT ECEVIT: Well, I'm sure there are people of Turkish origin wouldn't want to do that, but external forces would try to influence the situation in Turkey. After all, we paid great prices because of the virtual partitioning of Iraq. We missed at least $50 billion worth of incomes. And the separatist terrorist, PKK, had easy access to Turkey to, inside Turkey.

JIM LEHRER: What do you say to what President Bush and others have said, is that as long as Saddam Hussein is in control of Iraq, Iraq will be a threat to the region. It is attempting to build weapons of mass destruction.

BULENT ECEVIT: Yes, we certainly have to undertake all measures to see to it that the Baghdad regime is not organized and militarized in a degree and way that it would pose a serious threat for the region. We wouldn't allow that. And of course we have been cooperating with the United States through an air base in Turkey called Incirlik, where American aircraft are situationed. And whenever there is something that creates a suspicion, the aircraft in Incirlik intervene. So we keep an eye, a close eye on northern Iraq, because northern Iraq is a serious problem for us. It could be used as a basis for partitioning in Turkey, as well. Nobody could do it, but the efforts to do such a thing would cause serious problems in Turkey. So we are fulfilling our task in preventing serious armament stocks in Iraq within our possibilities.

JIM LEHRER: Did you discuss this with President Bush or any other U.S. officials?

BULENT ECEVIT: Yes. President Bush brought up the question yesterday when we visited with him. He expressed in strong terms that he can't... That he has to get rid of Saddam Hussein.

JIM LEHRER: And you expressed back what you just said to me, the concerns of Turkey?

BULENT ECEVIT: Well, that our main concern is that Iraq should not become a divided country.

JIM LEHRER: And that... What did... Did you say what Turkey's position would be if the U.S. did take military action of some kind?

BULENT ECEVIT: Well, we wouldn't even think of a military action because that would have extremely adverse results for Turkey. After all, we are on the borders. We have a common border with Iraq. And it's a very sensitive area geopolitically, but President Bush assured us that if and when Iraq may... The United States may take... They may decide to take a step, a serious step, they would consult with us.

JIM LEHRER: I see. I'm sure you're aware of this, Mr. Prime Minister, but there are many American commentators as a result of September 11 and the war on Afghanistan have suggested that Turkey is a perfect example, a model for a majority Islamic state but a secular state. Do you believe... In other words, people were concerned about what might happen in Iraq or Iran or Saudi Arabia even. They all point toward Turkey as a model. Do you that your country and the way you operate is transferable to other countries, Islamic countries?

BULENT ECEVIT: Certainly. We have proven, Turkey has proven that Islam can be compatible with democracy, with modernity, and even with secularism, so... But some Islamic countries had doubts about that. However, after the tragic events of the 11th of September, several circles in other Islamic countries began to think that after all the Turkish model should be the model that they would take as an example themselves. It may take some time, but I'm sure that a new feeling to that... In that regard is becoming apparent in many Islamic countries-- not in all of them, but most them.

JIM LEHRER: What do you say to critics who suggest that one of the ways Turkey has been able to deal with potential problems from radical fundamentalist Islamic groups is through rather harsh treatment of them, both in terms of human rights violations and that sort of thing?

BULENT ECEVIT: Although we dealt decisively with all terrorist organizations, we at the same time not only maintained, preserved our democracy, but kept improving it. We have in the last two years, we have passed 350 legislation in the parliament, most of which deal with democratization, human rights, and of course, economy. And while we fought against terrorism, we at the same-- our anti-secular forces-- we at the same time took care that we should abide, we should continue to abide democracy and human rights. And it is essential that in fighting terrorism, sacrifices should not be made on democracy.

JIM LEHRER: Finally, Mr. Prime Minister, I read about the desire of Turkey to have a better economic relationship with the United States, particularly on some tariff relief on steel and other things, and my understanding is that you came up empty handed on this trip, is that correct?

BULENT ECEVIT: No, I don't think so. On the contrary, the United States' Foreign Office, State Department, issued a statement yesterday saying that our strategic partner... America's strategic partnership in Turkey, which is based particularly on security concerns and politics; in addition to that, to supplement it, economic partnership also will be established, and for that purpose a committee will be formed, the first meeting of which will be held at the end of September, headed by Mr. Larson from the American side. And this arrangement will take up all the economic and trades relation problems between the two countries.

JIM LEHRER: So you do not leave here disappointed, you leave here happy with...

BULENT ECEVIT: No, I believe in the good well of the United States' administration.

JIM LEHRER: Mr. Prime Minister, thank you very much.

BULENT ECEVIT: Thank you. It has been a pleasure meeting you.

ESSAY - A WRITER'S MIND

JIM LEHRER: Finally, tonight, essayist Roger Rosenblatt has some thoughts about the mind of a writer.

ROGER ROSENBLATT: On the front page of the "New York Times," recently, appeared the face of the author and historian, William Manchester. It was the face of despair, though if one did not know the story the photo illustrated, Manchester's glassy blue eyes and the parallel lines of the creases on is forehead might have suggested a man lost in creative thought instead. But the story was about Manchester's inability to retrieve creative thought, in order to complete the third and final volume of "The Last Lion," his much-admired biography of Winston Churchill. Manchester, who is 79, suffered two strokes after his wife died three years ago. His mind can no longer find the words to write. "I can't put things together; I can't make the connections," he says. The face shows all the bewildered agony of someone realizing that he cannot do what he was born to do. We are, more than anything else, a narrative species. We were built to tell stories, like that of Churchill, and thus to keep the larger, longer story of ourselves alive. When we lost the capacity to put things together to make connections, the disability is akin to schizophrenia. The storytelling capacity is gone, and with it, our nature. When that calamity befalls a writer, it is especially painful, because all that a writer has to work with are words and connections. To date, Manchester's words have provided an amazing list of successes. "The Death of a President," on the Kennedy assassination, sold 1.3 million copies. The first two volumes of the Churchill biography, "Visions of Glory" and "Alone" sold about 400,000, and are still in print. Their many hundreds of thousands of words came from a mind that loved to write. Manchester was capable of thinking dozens of paragraphs ahead of where he was in a text; and he never wanted to stop. One sees this rampant activity in writers from time to time, especially in historians like Carlyle and Macauley, and in the remarkable modern work of Arthur Schlesinger, Jr., And Daniel Boorstein. Painters like Picasso, too, produced and produced. The writer's mind, when it works, is like Alice's rabbit, leading quickly, almost recklessly, to mysterious, yet attractive, places. The animal is fretful because it has to find and display something at the same time. A writer writes to discover what he or she thinks. Take a single sentence. Take a sentence of William Manchester's -- this sentence about Churchill's funeral: "When his flag-draped coffin moved slowly across the old capital, drawn by naval ratings and bare-headed Londoners stood trembling in the cold, they mourned, not only him and all he had meant, but all they had been and no longer were, and would never be again." Most likely, Manchester had only the scantiest idea where that sentence would end when he began it. Only when he caught up with it could he know. But then, there was another sentence running ahead of him. There was always another sentence. And now there isn't. And on some days, he says, he succumbs to despair -- the despair reflected in the "New York Times" picture. It was an interesting decision of the "Times" to put that photo and story on page one, amid the usual big news of wars and Presidents. Manchester's is simply the story of a writer's mind disabled. But that is a very great story, since out of such a mind comes everything we know. He can no longer make the connections, thus neither can his myriad readers who now mourn "not only him and all that he had meant, but all they had been and no longer were, and would never be again." I'm Roger Rosenblatt.

RECAP

JIM LEHRER: Again, the major developments of the day: A Palestinian gunman opened fire in a wedding hall in Israel killing six people wounding 33. He was then shot dead by police. And the head of the Securities & Exchange Commission called for tough new controls of the accounting profession. He said the Enron collapse exposed that need: We'll see you online, and again here tomorrow evening with Shields and Brooks, among others. I'm Jim Lehrer, thank you and good night.