The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight Elizabeth Farnsworth examines the tidal wave tragedy in Papua, New Guinea; Susan Dentzer lays out the congressional differences on managed care; and then Senators Nickles and Kennedy debate them. Jeffrey Kaye reports on the search for affordable housing in Los Angeles, and Paul Solman looks at the surface of things. It all follows our summary of the news this Monday.% ? NEWS SUMMARY

JIM LEHRER: Seven hundred people were confirmed dead today from Papua, New Guinea's massive tidal wave. A 23-foot wall of water swept away at least four villages on an 18-mile stretch of the Northwest Coast on Friday. Local officials said the death toll could go as high as 3,000.

GOV. JOHN TEKWI, West Sepik Province, Papua, New Guinea: Many of the bodies are still stuck in the debris within the mangrove swamps, within the lagoon itself, caught between the debris from the buildings, the coconut trees, and all this tree stuff that have been thrown into the lagoon and, you know, it's so difficult at this stage. I couldn't give you any figure at all about how many bodies we would have retrieved from the lagoon. In fact, we haven't recovered any from the lagoon yet, but we know they are there.

JIM LEHRER: At least 6000 people were left homeless. Thousands are still missing. Australian air force cargo planes arrived today with emergency supplies. Aid workers treated hundreds of injured villagers airlifted to field hospitals. The tidal wave was caused by an undersea earthquake. We'll have more on this story right after the News Summary. The heat wave continued today in much of the United States. Officials said at least 113 people have died from it across the South and West. It was over 100 degrees today in Dallas for the 15th straight day. The Northeast was the latest region to be hit with high humidity and temperatures in the 90's. The National Weather Service forecasted continued high temperatures for another week or more. On the General Motors strike story today union officials at GM's Saturn plant in Tennessee said a shutdown there was at least a month away. Saturn employees voted over the weekend to authorize the walkout. It's GM's only US facility still turning out cars. A UAW strike at two key Michigan plants has closed down the rest of the company's North American operations. There was another merger today in the banking industry. Sun Trust Banks is buying Crestar Financial Services in a $9.5 billion stock deal. The combined company will be the 10th largest bank in the United States, with nearly 1100 branches stretching from Maryland to Florida. Overseas today the military ruler of Nigeria announced a plan to restore civilian rule. General Abdusalam Abubakar said in a nationally televised speech change would come by June 1999. He also pardoned 10 political prisoners. There have not been free elections in Nigeria since '93 when the military regime was nearly voted out. It then canceled the results to hold onto power. In the Middle East the Israelis and Palestinians resumed their first face to face talks in months today. There were no reports on progress. They were attempting to break a 16-month deadlock over terrorism and land concerns. The Palestinians want the Israelis to agree to a U.S. peace plan. It calls for Israel to give up 13 percent of the West Bank in return for security guarantees from the Palestinian Authority. And that's it for the News Summary tonight. Now it's on to the tidal wave tragedy, the managed care debate, affordable housing, and the surface of things.% ? FOCUS - KILLER WAVE

JIM LEHRER: The killer wave. We begin with a report by Krishnan Guru-Murphy of Independent Television News.

KRISHNAN GURU-MURPHY: It must have been nature at its most terrifying, the Three Tsunami, the Japanese term for giant wave, swept over the villages ten meters high. There was no warning, no time to run.

MAN: So many children were killed-old age-and only those strongest and the fleetest people survived. The rest were killed.

KRISHNAN GURU-MURPHY: The bodies are being buried quickly. There are too many for ceremony or dignity, and the threat of disease is too great to wait even for them to be identified. The waters and swamps are full of bodies. Many were also washed out to sea. There are thought to be over 2,000 still missing. The villages have lost a generation of children. They were the weakest, and it was a public holiday. Those who survived say it sounded like a jet had landed as the waves came upon them. It started under the ocean floor with an earthquake. Part of the earth's crust was thrust under another part. The movement created a wave of extraordinary power, moving towards the coast. As the wave reached shallow water, it was forced up to a phenomenal height. It hit the shore at around 50 miles an hour, doing as much damage again on the way back. The injuries are horrific-broken bones, terrible damage. The Australian defense force has set up a mobile hospital. The Red Cross and Red Crescent are there too, and the aid workers who are there say it's a lot worse than they'd anticipated.

JIM COUCHER: Disaster. Absolutely disastrous. It's far bigger than we thought it was going to be.

KRISHNAN GURU-MURPHY: There are at least 6,000 people left homeless and with literally nothing save the clothes they're wearing. For now they're in temporary shelters being supplied by the aid effort. But Papua, New Guinea is a poor country. The resettlement will bring with it a whole new set of problems. This is a land of superstition and magic. The disaster areas are fearful places now, and it's unlikely the people will return.

JIM LEHRER: And to Elizabeth Farnsworth in San Francisco.

ELIZABETH FARNSWORTH: And we're joined now by Eddie Bernard, director of the West Coast National Oceanic & Atmospheric Administration Research Lab. He has been researching tidal waves or Tsunamis for the past 30 years. Thank you for being with us.Mr. Bernard, you've seen a lot of tidal waves in your years of work. Is this one of the worst you've ever seen?

EDDIE BERNARD, National Oceanic & Atmospheric Administration: Well, this certainly ranks up among the most damaging in terms of loss of life.

ELIZABETH FARNSWORTH: Explain to us-I want to go back over the explanation that we just heard but in more detail. Start with the earthquake and explain what happens to cause something of this power.

EDDIE BERNARD: Well, you might want to think of a piece of ocean floor about a hundred miles long by about thirty miles wide and imagine that it lifts up very abruptly about six feet. And that's probably the scenario that they witnessed during the New Guinea earthquake. This automatically pushes the water-the surface of the ocean water up about the same amount of elevation, and then when gravity tries to restore the ocean back to its normal position, you create a series of waves, and then the first wave, which struck about five minutes after the earthquake, as eyewitness accounts said, that it was a roar, that's fairly typical. Water will withdraw and expose the sea floor, and then as a new wave comes in, it makes a very loud sound as it comes barreling into the ocean-from the ocean into the coast line at about twenty-five to thirty miles per hour and destroying everything in its path. Then it will recede, and then another wave will approach some ten to twenty minutes later, and this process will be repeated about three waves, so the entire episode will last over an hour, with a series of three to maybe four or even five waves.

ELIZABETH FARNSWORTH: And the terrible injuries and destruction occur not only because of the force of water hitting but because there are pieces of all kinds of things in the water, houses and machinery, right, and you're being hit by that?

EDDIE BERNARD: Yes, that's correct. The first wave-and especially in this case I'm sure most of the houses there were made out of wood or some wood product, so they instantly became part of the Tsunami. And as the first wave broke everything up, then all of this material was in the water, and you're bringing swept back and forth at twenty-five to thirty miles an hour caught in-between these pieces of material that could be a coconut tree, could be a part of a house. But as these objects hit each other and if you're in-between 'em, then people will be knocked unconscious, broken limbs will occur, they'll be unable to swim, and they'll drown in this process.

ELIZABETH FARNSWORTH: And so many children died because they are too small to resist it, right, they can't swim their way out?

EDDIE BERNARD: Absolutely. This is the-the tragedy of these events is that usually the weak portion of society is the one that dies-the children and the elderly.

ELIZABETH FARNSWORTH: How common is-and by the way-should we say Tsunami or Tidal Wave?

EDDIE BERNARD: It's your preference. Tsunami is the Japanese word. Tidal Wave is an apt description of the process. It looks like a very rapid tide to people who live along the coast-whatever word works for you.

ELIZABETH FARNSWORTH: How common are they?

EDDIE BERNARD: Well, in the Pacific Ocean over the last hundred years there has been one destructive Tsunami per year on average. So they are very frequent in the Pacific Ocean. This ranks among one of the most destructive-probably "the" most destructive one was in 1896 off the coast of Japan, where 23,000 people perished.

ELIZABETH FARNSWORTH: And what causes them besides earthquakes?

EDDIE BERNARD: In addition to earthquakes volcanic eruptions, explosive types like Crakatowa, underwater-

ELIZABETH FARNSWORTH: Crakatowa was the volcano in what is now Indonesia, right?

EDDIE BERNARD: That's correct. Crakatowa in Indonesia. Underwater landslides can also generate Tsunamis. And in some instance earthquake is accompanied by an underwater landslide, so the combination can make a Tsunami larger than the earthquake would produce by itself. And then a final way to produce a Tsunami, although we have no direct evidence of this, is, of course, a meteor hitting the Pacific-any ocean-any body of water that could actually create a cavity in the ocean surface. That too would produce a Tsunami.

ELIZABETH FARNSWORTH: What difference did it make in this case that the earthquake occurred not far off the coast?

EDDIE BERNARD: Well, that means it's particularly dangerous because the time from-the time the earthquake stops to the Tsunami arrives is very short, giving the residents almost no time to react. But also, it probably made it more efficient. In this particular part of the world-

ELIZABETH FARNSWORTH: By efficient you mean powerful?

EDDIE BERNARD: By efficient I mean powerful, that is, the transfer of energy from the earthquake to the water was very efficient, because it was near the shore, near the coast line and all the energy went directly into the wave formation. In addition, this has a very steep ethemmetry off the coast there, so it's quite possible that there was an accompanying landslide. In terms of earthquake magnitudes, this is a relatively small earthquake that produced a large Tsunami. So this is something that a survey team will investigate when they arrive in New Guinea about August 1st.

ELIZABETH FARNSWORTH: And I didn't understand what you said. Did you say that it might have made a difference that the coast was so steep there?

EDDIE BERNARD: Yes, it will make a difference. It can make a difference in two ways. One is that if it's a steep coast, the likelihood of an underwater landslide is greater, and two, if it's a steep coast, the Tsunami can arrive from the open ocean to the coastline without any degradation in its energy. It arrives without any resistance by the coastline.

ELIZABETH FARNSWORTH: Mr. Bernard, you were director of the National Tsunami Warning Center in Hawaii for a while. Can there be warnings of these things?

EDDIE BERNARD: For this type of event the warning is almost impossible, because the time is only minutes. The warning center in Honolulu and in Palmer, Alaska are designed to issue warnings on the order of ten to fifteen minutes after the earthquake happens. In this case the warning could not-would not have been issued by any warning system. So the best mitigation process that we could have for a situation like this is education. Surely the people of New Guinea felt the earthquake. If as soon as they felt the earthquake, then they would have taken evasive action by heading for high ground. This occurred about dinnertime, so it's not quite clear if their activities would have precluded them observing how intense the earthquake was.

ELIZABETH FARNSWORTH: But if somebody in California say feels an earthquake and they're on the coast, they should just run the other way, is that right?

EDDIE BERNARD: That's certainly-nature's warning you that there's something about to occur, and certainly you should take nature's heed and move inland as quickly as possible. If you're lucky and there's no Tsunami, there's no problem, you just have a little energy. But if there is a Tsunami, you've saved your life.

ELIZABETH FARNSWORTH: Well, Mr. Bernard, thank you very much for being with us.

EDDIE BERNARD: You're welcome.

JIM LEHRER: Still to come on the NewsHour tonight the congressional debate on managed care, affordable housing, and the surface of things.% ? FOCUS - AFFORDABLE HOUSING

JIM LEHRER: The housing story. Jeffrey Kaye of KCET-Los Angeles reports.

JEFFREY KAYE: The US housing market is thriving. Building permits and home sales exceed last year's numbers.

SPOKESMAN: The current owner who lives here has done a lot of things to the house-

JEFFREY KAYE: In the Los Angeles area prospective home buyers and tenants have been locked in bidding wars over home sales and rents. In some neighborhoods prices have gone up more than 30 percent in the last year.

SPOKESPERSON: This is a really desirable unit.

JEFFREY KAYE: The competition can be ferocious in particularly desirable communities, such as Santa Monica, which is on the coast. At the Santa Monica office of the Fred Sands Real Estate Company manager Donna Beebe says the market is red hot.

DONNA BEEBE, Real Estate Agent: We're experiencing about, oh, 50 percent of our offers are multiple offers, which is to say that more than one buyer has written an offer on the property, and usually a manager sits in at that time, and it's almost an auction-where in order to be the winner, you're coming in with the highest bid.

JEFFREY KAYE: But while business is booming for real estate agents, it's another story for renters. Los Angeles County has the worst shortage of affordable housing in the U.S., according to a recent national study. Here the average rent for a two-bedroom apartment is $850 a month. That's beyond the reach of many families who resort to doubling up or crowding into converted garages or substandard buildings. LA City's slum housing task force keeps busy. Headed by prosecutor Richard Barb, the task force investigates violations of health, fire, and building codes. Barb says at any given time his staff is working on a hundred different buildings where tenants filed complaints.

RICHARD BOBB, LA City Prosecutor: And these people have no place else to go, and so some of these buildings have what they call a warm bed-apartments-somebody sleeps in them during the day-and then goes to work at night-somebody sleeps at night and goes to work during the day and there are two or three families living in the same apartment unit.

JEFFREY KAYE: How serious is the problem in Los Angeles?

RICHARD BOBB: It's so serious that nobody knows because nobody's done a survey.

JEFFREY KAYE: I mean, I've read that there are 156,000 or more apartment units that are substandard.

RICHARD BOBB: Those statistics were done by the Census Bureau, but they're based on estimates. Nobody knows for sure.

JEFFREY KAYE: Nationwide, housing for one in seven American renters is unaffordable. That figure comes from the U.S. Department of Housing & Urban Development, which found in a recent study that 5.3 million American households spend more than half their income on rent or live in severely substandard housing. Peter Dreier is a former Boston city housing director, now a public policy professor at Occidental College in Los Angeles. Dreier says the widening gap between incomes and housing prices is at the heart of the problem.

PETER DREIER, Occidental College: So you have an economic boom in a city or in a region, and, as we said earlier, rents go up, and so the process is often called gentrification, where instead of trickling down the housing market trickles up. So you have two things going on. You have fewer federal subsidies to make housing affordable, and then you have the market operating exactly in the opposite direction, which is more and more people who used to live in private housing with decent rents, those rents are now through the roof.

JEFFREY KAYE: All of which puts pressure on government to maintain the existing stock of affordable housing. LA City is beefing up its apartment inspection program to examine buildings before there are complaints, but prosecutor Bobb says these holding actions.

RICHARD BOBB: I feel like we're treading water.

JEFFREY KAYE: What do you mean?

RICHARD BOBB: Well, I mean every other task force brings up to code about 1500 units, which is far more than are being built in the city right now. But then what have you got? You've got a low income apartment building that is marginal, that at least is safe, and habitable. But we need to build some new housing.

JEFFREY KAYE: In fact, the nation's stock of affordable housing is shrinking. Besides cutbacks in public housing and rental subsidies, private sector production has slowed, according to Peter Drier.

PETER DREIER: They can't make the numbers work. In a city like Los Angeles to build a unit of housing costs about $100,000 or $120,000. And in order to make that unit profitable a landlord needs a rent of about $1,000, and there aren't enough people who can afford to pay $1,000 a month, and so they're not being built.

JEFFREY KAYE: That's one reason the Martin family, parents and three young children, live crammed together in a one-room apartment in Hollywood and four-year-old Gabriella sleeps with her parents in the same bed. The family pays $400 a month rent but hopes to soon move into something more spacious. Across the street newly refurbished apartments are becoming available.

SPOKESMAN: It's for persons with low income.

JEFFREY KAYE: Until recently this building was abandoned, a haven for gangs and drug addicts. That was before the non-profit Hollywood Community Housing Corporation acquired it two years ago.

SPOKESPERSON: And here's another one of the bedrooms.

JEFFREY KAYE: Christina Duncan is executive director of one of a growing number of non-profit agencies that finance affordable housing-credits and government grants. The non-profits create housing for families who are at or just above the poverty level. But Duncan says the agencies are unable to keep up with the growing demand.

CHRISTINA DUNCAN, Hollywood Housing Corporation: We got 500 applications for this particular building. And there are only 22 units available.

JEFFREY KAYE: Their low income qualifies the Martins as possible tenants. Martin Martin earns a modest income as a motel clerk. His wife, Sylvia, doesn't work outside the home. Qualified tenants will be selected by lottery. If chosen, the Martins could move from their one room to a three-bedroom apartment for the same monthly rent. While some families are trying to move to affordable housing, others, such as Gina Urie, a single mother of five, fear losing what they've got. She recently learned that her landlord would no longer accept her Section 8 housing certificate. That's a form of rental assistance like food stamps funded by the federal government. Landlords who accept the subsidies agree to rent set by the government. Urie is living on welfare in Santa Monica. She's going to school and hopes eventually to get a job. To stay put she'd have to come up with an extra $700 a month, the difference between the subsidy and the rent. So she says she has to move.

GINA URIE: This is our home. This is our community. And I don't want to have to leave this. I know all my neighbors. I'm very comfortable. I'm very safe and secure, and my children feel safe and secure. It's their home, and I'm not going to be able to find a place in Santa Monica, I'm sure, because the majority of owners are all opting out of their Section 8 leases.

JEFFREY KAYE: Many landlords who welcomed the rent subsidies during California's recession have stopped taking them. Today they anticipate getting higher rents than Section 8 will pay, particularly since California rent control laws are being weakened, allowing landlords to ask market rates. Landlord Herbert Balter was one of the first to opt out of the subsidy program. He's president of the Action Apartment Association of Santa Monica.

HERBERT BALTER, Landlords' Association: I don't see where it's written that I am to subsidize my tenants. It is a capitalist society out there, and I have a right to make a profit on my investment. So if you feel that Section 8 is giving you less than the market rent, I see nothing wrong with any landlord opting out.

JEFFREY KAYE: The effects of government and private enterprise on the supply of affordable housing are subjects of continuing debate and negotiation.

RICHARD RIORDAN, Mayor, Los Angeles: Our economy is up. Quality jobs are up. But now we have to get to a point where people can live in standard, excellent housing, not the kind of substandard housing we have all over our city.

JEFFREY KAYE: Recently, Los Angeles Mayor Richard Riordan joined with city and banking officials to announce a loan program to landlords to finance repairs of substandard buildings. In Santa Monica activists and the city council are also taking measures to try to resolve the plight of renters such as Gina Urie. In early June Urie and other recipients of federal housing assistance came to a city council meeting. At issue was a proposal for the city to subsidize rents should landlords opt out of the federal program.

SPOKESMAN: Let's step in. Let's help tenants pay their more rent in cases where their owner has opted out.

JEFFREY KAYE: Council members called on Washington to provide more financial assistance.

SPOKESMAN: I certainly hope we can resolve this issue in Washington and with HUD ASAP, as soon as possible, because there are not many cities in the country that can afford subsidized rent.

JEFFREY KAYE: There was no dissent.

SPOKESPERSON: Council member Greenberg.

COUNCIL MEMBER GREENBERG: Yes.

SPOKESPERSON: Council member-

COUNCIL MEMBER: Yes.

JEFFREY KAYE: And the council voted unanimously to provide city rent subsidies for the threatened tenants.

GINA URIE: I'll be able to stay where I'm at. My children will be able to stay there.

JEFFREY KAYE: You made it.

GINA URIE: Yes. I'm very happy.

DENISE ROBINSON: I was just happy because I didn't know if I was going to end up being homeless or not. And now so-it's kind of hard to speak.

JEFFREY KAYE: These renters will get temporary relief. But there is little dispute that the underlying problem will worsen unless more affordable housing is created.

JIM LEHRER: A further update. Last week the Martin family's application for that three-bedroom apartment across the street was approved.% ? UPDATE - MANAGED CARE

JIM LEHRER: The managed care debate. We begin with a backgrounder from Susan Dentzer of our health care unit, a partnership between us and the Henry J. Kaiser Family Foundation.

SUSAN DENTZER: The skirmish over patients' rights legislation turned into an all-out brawl last week.

REP. DENNIS HASTERT: This afternoon, we are introducing the Patient Protection Act because we are intent on protecting patients and guaranteeing choices without the heavy hand of big government.

REP. RICHARD GEPHARDT: There are others in Congress who favor different approaches. They don't agree yet that we ought to have strict enforcement of these rights and responsibilities. We reach out to them today because we want to pass legislation in this Congress.

SUSAN DENTZER: All three plans under consideration-the House and Senate Republican proposals, and the Democratic alternative backed by President Clinton-have elements in common, although the details very.

REP. DICK HASTERT: We guarantee access to emergency rooms so that during emergencies, folks won't be forced to drive miles past the nearest facility, in this case George Washington Medical Center, in order to get an ER that's in their health plan.

SEN. TOM.DASCHLE: This is not a bill designed to provide political cover. Our is a bill designed to provide medical Coverage--emergency care in an emergency-- no questions asked.

SUSAN DENTZER: All the bills make explicit bids to appeal to women.

SEN. TOM DASCHLE: Access to a specialist if your child needs one; the right of a woman to choose her own doctor.

REP. DICK HASTERT: The Republican Patient Protection Act guarantees women and children the right to see an OB/GYN or pediatrician respectively-without first having to go through an insurance company gatekeeper.

SUSAN DENTZER: At the same time, there are also big differences among the three proposals in the number and scope of protections they would provide. One difference is just whom these proposals would affect. Depending on what health insurance plan an individual belongs to, existing state and federal regulation may impose different standards. Democrats and House Republicans think their proposed new federal protection should apply to all 161 million Americans with private health insurance, including those whose insurance is currently regulated by the states. Senate Republicans point out that at least 33 states already have passed some basic managed care consumer protection. They would only extend new federal protections to the estimated 48 million Americans whose employers underwrite coverage that isn't regulated by the states. Perhaps the biggest difference among the plans is how they would handle serious disputes that arise between managed care organizations and their patients--such as when health plans refuse to cover care that patients and their doctors think is needed. President Clinton cited several disturbing episodes that he had learned of last week.

PRESIDENT CLINTON: In all three cases, what the doctor told the patient the patient needed was ultimately approved, and in all three cases, it was approved so late that it was too late to do the procedure, so they died anyway. So, you can write all the guarantees you want into the law here in Washington, and if nobody can enforce them, the delay in the system will still cause people to die.

SUSAN DENTZER: To deal with such disputes, both Democrats and Republicans would create mandatory appeals procedures for health plans. But the big difference lies in what additional actions patients could take if they failed to get care and were injured as a result. House Republicans would allow patients to sue their health plans in federal court, as they can now, but the courts, in turn, could saddle health plans with penalties if they wrongfully denied coverage. Senate Republicans do not have any provision in their plan that would either expand the right to sue or increase penalties. Democrats want to go much further than both Senate and House Republicans. They would override an existing federal law. Patients could sue in state courts for potentially huge compensatory and punitive damages if they were injured because their health plans refused to pay for care.

SEN. TOM DASCHLE: You know, there is something wrong in this country when the only groups of people who get immunity from our laws are foreign diplomats and HMO bureaucrats. It's time for HMOs to understand: when their decisions cause the death or injury of a patient, they will be held responsible.

REP. NEWT GINGRICH: Our goal is not to create more trial lawyer fees. Our goal is not to create more lawsuits. Our goal is to get the patient to the right doctor with the right knowledge to get the right care as rapidly as possible.

SUSAN DENTZER: While Senate negotiators debate the terms under which patients rights bills will be brought to the floor, the House is expected to take up legislation late this week.

JIM LEHRER: And now to two key senators involved in this debate: Edward Kennedy, Democrat of Massachusetts is a lead sponsor of the Democratic bill; Don Nickles, Republican of Oklahoma, is the assistant majority leader, and he heads the Senate Republican Task Force on Health Care Quality.Sen. Kennedy, why is your way the best way to go?

SEN. EDWARD KENNEDY: Well, first of all, let's put this issue in some perspective. What we are attempting to address are the kinds of abuses which exist in our health care systems, particularly with HMO's. In too many instances managed care means mis-managed care. And the basic core of our bill is to make sure that medical decisions that are affecting the families of America are going to be decided by doctors and not bureaucrats or accountants for the major insurance industry. That's basically at the heart of our bill. We believe you ought to put the patient's interest first, not the profits of the HMO first, and that is a very basic and fundamental difference between our proposal and the Republican proposal.

JIM LEHRER: Sen. Nickles, do you agree that that's a basic fundamental difference? Sen. Nickles? I'm sorry. Do you hear me? Sen. Nickles, do you hear me? Sen. Nickles, you do not hear me.

SEN. DON NICKLES: I know you're asking me a question. I couldn't hear a word. But-

JIM LEHRER: Do you agree with what Sen. Kennedy said was the basic difference? Do you hear me now?

SEN. DON NICKLES: Yes, I hear you fine. I think there are very significant differences, and I have great respect for my colleague, Sen. Kennedy. We have a different approach. I think his approach would be very, very expensive. The cost of it would go in an insured category. I don't want to do that. What we try to do with our approach is give patients that are unprotected protection. There's about 48 million Americans that aren't covered by state laws. We'll give them protection under federal, called ERISA, so we'll do that. But we don't want to drive up health care costs. Under his bill you might call it the lawyer's right to bill. It gives 59 different causes of action for expanded litigation in the health care field. Also, they can sue not only HMO's but also employers, and if they do that, the net result is a lot of employers are just going to drop these health care plans. They're going to say, thank you very much, but I'm not going to be liable for that kind of exposure and have health care costs, which are already projected to go up about 5 percent, add that another 4 percent if we pass the Democrats bill, that's a 9 percent increase in health care costs. It costs about an extra $500 per year, per employee. Employers can be dropping plans if that's the case. So we came up-instead of this big excuse for litigation-we came out and said, let's get people get health care they need so they can appeal, they can appeal internally to a physician that hasn't been working on the case. If they're not satisfied then, they can go to an external appeal. A physician is not even related to the case, not connected with the company in any way, shape, or form. So they can get action on the health care that they've been denied, not get tied up in the courts for an unbelievable period of time.

JIM LEHRER: Do you agree with Sen. Kennedy that there is a problem with-I mean, that something has to be done? In other words, the disagreement is over how to do it, right?

SEN. DON NICKLES: Well, a basic disagreement, and when we found that 48 million Americans are not covered by state plans, we felt like they should have some basic protections, and so we put that in, and then we said, well, wait a minute, those protections should apply to everybody, so our bill-when the Democrats said yours only applies for 48 million is not true. Our bill apples to every employer-sponsored plan. We give every one of those plans the right of appeal, both internal appeal and external appeal. We think that's a giant step in the right direction. And we also did a lot of other things. We put in some provisions to improve quality health care. We put in provisions to help women as far as some of those particular health issues that are particular to them. We reauthorized things. We put in health care quality research, so we're trying to improve health care quality, not just drive up expenses and help the trial lawyers.

JIM LEHRER: Sen. Kennedy, yes, sir, go ahead.

SEN. EDWARD KENNEDY: If I could make a quick response.

JIM LEHRER: Sure.

SEN. EDWARD KENNEDY: It's interesting that the doctors in this country support our program and the nurses support our program. And the 170 health professional and patients organizations support our program. And it's interesting, the doctors and the nurses are not great fans of the trial lawyers, and they supported this program because they know that a right without a remedy is no right at all, and they know the importance of having accountability in these programs. Now, secondly, the Republican program only covers 48 million Americans. It doesn't cover the other over 100 million Americans that needs these protections. There's a very basic and fundamental gap that the Republican program refuses to address. And beyond that, even within their program, they're still permitting the insurance companies to call the tune, because they are not permitting the ultimate judgment decision on health care to be made by the doctors and the patients. They're not permitting that. They're not encouraging that. They're not writing that into law. And that is what is absolutely essential. You have to have that kind of protection. Furthermore, in the Republican program they are not guaranteed the kind of specialty care for a child that has cancer. They're not permitting women that need the OB-GYN and gynecological services to have specialists as primary care physicians They are not permitting the clinical trials, which are so important. And they are also effectively refusing to permit the states to make the judgment on calling for accountability. For example, in Mr. Nickles' own state of Oklahoma, county and state employees can sue for accountability. And they have tax paid health insurance. And I wonder why Mr. Nickles is so opposed to permitting a farmer in Oklahoma or small businessman or woman or a worker in Oklahoma the same kind of protections in Oklahoma that they are giving to the county and state officials.

JIM LEHRER: Let's start there and go back up, Sen. Nickles. Let's start there and go back through Sen. Kennedy's point.

SEN. DON NICKLES: Well, let me just make a couple of comments. One, Sen. Kennedy talks about states rights, but he really believes that the federal government should run health care-

SEN. EDWARD KENNEDY: We're leaving this to the state.

SEN. DON NICKLES: And the federal government should run insurance. The states regulate insurance, not the federal government. Frankly, the federal government is not doing a very good job even managing Medicare. We told the federal government last year to get Medicare information to the 38 million Medicare beneficiaries. They've done that to 5 million people. We told 'em to put in a hot line or toll free telephone line. They haven't done that yet. So they're doing a crummy job in many cases of doing what we told them with Medicare. The private sector is regulated by the states and Sen. Kennedy wants the federal government to do it all, and the federal government is not doing a very good job. And now concerning states, Senator Kennedy's state has 24 mandates. Oklahoma has 24 mandates, some of which are covered by the federal-are identical to the federal proposal, not all of it. But some of us don't really think the federal government should be micromanaging this from Washington, D.C.. We don't think the federal government did a very good job.

JIM LEHRER: Is that the heart of the argument from your point of view, Sen. Nickles?

SEN. DON NICKLES: I think so. That's exactly right. And with all due respect to my colleague from Massachusetts and the president, they want the federal government to run health care. They want it to run the insurance industry. They want the federal government to be micromanaged. They didn't win a couple of years ago when they tried to national the health care industry. They failed in Congress, so now they're trying to do it with a great title, the Patients' Bill of Rights, a great title, but really what you should call it is a lawyer's right to bill, because basically that's what it would do. It would just be turning this over to the trial lawyers. And health care costs would explode. And as a result of that, millions of people would lose their health insurance.

SEN. EDWARD KENNEDY: Well, the fact is that the bureaucracy that is out there, Jim, is the insurance industry bureaucracy. They're the bureaucracy that's out there. They're the ones, the HMO's that are making the decisions denying care. It isn't the federal government today. It is in the insurance industry, number one. Secondly, we believe that the states ought to be able to make the judgments and decisions about the enforcement on a liability. Mr. Nickles still has not answered the question of why county and state employees in the state of Oklahoma can sue, and workers or farmers cannot.

JIM LEHRER: But what about-

SEN. EDWARD KENNEDY: Let me just mention this point.

JIM LEHRER: All right.

SEN. EDWARD KENNEDY: There are 23 million Americans that have the protections, the liability protections, the accountability protections that I would permit the states to make their judgments on. We leave this up to the states. There are 23 million Americans that have that protection now. It's working. There premiums aren't any higher. The CBO has made the judgment now-

JIM LEHRER: That's the Congressional Budget Office.

SEN. EDWARD KENNEDY: The CongressionalBudget Office says that it'll amount to about $7 a month, of which $2 a month would be paid by the worker. It seems to me that those workers would like to have that kind of insurance to make sure that they're going to get the best of the health care instead of additional kinds of profits to make up for the HMO's.

JIM LEHRER: Just make sure that we-and I don't want to over-simplify this, but what you're saying, Sen. Kennedy, is that all of these protections will not be there unless there is a federal law enacted, is that correct?

SEN. EDWARD KENNEDY: I believe that we ought to protect the child, whether the child lives in Florida, Mississippi, or Massachusetts. And I think they ought to have those kinds of protections. The states are not providing the protection. We ought to establish a floor. The states want additional kind of protections. They ought to be there. But we have some responsibility to make sure that these decisions are going to be made for the interests and the health of those children and not for the profits of the industry. That's at the heart of the issue.

JIM LEHRER: And, Sen. Nickles, you believe that these protections can be there without the federal government passing a law and mandating them down the list.

SEN. DON NICKLES: Jim, what we try to do is we try and protect the unprotected. Most are protected by state plans. And what Sen. Kennedy's trying to do is say no we want the federal government to do it all, and the federal government is doing a crummy job right now with Medicare.

JIM LEHRER: How would the federal government do it all under Sen. Kennedy's bill?

SEN. DON NICKLES: Under Sen. Kennedy's bill-has a whole list of mandates and states you have to do it-you do it as we see fit. This is a bill-not a bill of rights-it's Kennedy's bill of mandates. There's 359 federal mandates in Sen. Kennedy's bill that will greatly increase health care costs, and it's basically telling the states you can't do it, we know best, government knows best, Washington, D.C. knows best, we're going to tell you how to do it, as if there's no response. You know, states you can't do it. Now Sen. Kennedy's state has not even applied with a bill that we passed last year, the so-called Kassebaum-Kennedy bill. It's one of five states that still hasn't complied, and I don't know why they haven't but my point being we shouldn't try and micromanage from the government trying to say that we can do better. What we try to do in our bill is protect those people who are not under state law, and then we offer every plan, not just 48 million Americans, for every plan in America we say everybody has a right to an appeal, internal and external appeal, so they can get their health care decisions made when they need it so they can help their kids and their family get those health care decisions, not go to court and have to wait two, three, four years to get a decision by a trial lawyer.

SEN. EDWARD KENNEDY: Now Sen. Nickles mis-states our legislation and then differs with it. That's a tried and tested mechanism here in the United States Senate. If you look at the various kinds of protections we're talking about is not to permitting an HMO to let someone drive by an emergency room when there's an emergency room there and emergency necessary, to permit gynecological and obstetric services as primary care--very important to women, obviously-to encourage clinical trials-that is very important-to eliminate the gag rule-what specifically are you complaining about on the ones I've mentioned so far? Those are five of the protections. Which of those do you object to?

SEN. DON NICKLES: Well, I just mentioned that everyone Sen. Kennedy mentioned-for example, in the gag rule 44 states have done it, the other states are considering it, but the gag rule is not really necessary. Thirty some states are doing in the emergency room-what we do is we put in and make sure those protections are available for plans that aren't-

SEN. EDWARD KENNEDY: Let me mention just on the gag rule-this is just for one minute-they say they eliminate the gag rule, but you know something else, in every one of the HMO agreements the head of the HMO can fire any doctor-do you hear that-can fire any doctor-so the one hand-under your bill we can say we eliminate the gag rule, but unless you prohibit the-

JIM LEHRER: We have to go.

SEN. EDWARD KENNEDY: --to fire that doctor, it's an empty-it's an empty right.

JIM LEHRER: Sen. Nickles, what's going to happen to this issue in the United States Senate?

SEN. DON NICKLES: We've offered to bring it up this week. We still haven't got an agreement from our Democrats to have the amount of time, the fair amount of time to consider both proposals, but my guess is before we leave for the office break that we will pass not the Kennedy bill, but I think we'll pass a bill that Republicans have worked on for the last seven months. I think it's a good bill, and we'll go to conference without it.

SEN. EDWARD KENNEDY: I'm hopeful that we can find a bill because it's important to the American people that we find one together.

JIM LEHRER: Gentlemen, thank you very much.% ? FINALLY - SEEING SCIENCE

JIM LEHRER: Finally tonight seeing science. Paul Solman of WGBH-Boston has the story.

PAUL SOLMAN: This summer and into next year a curious combo is touring the country. "On the Surface of Things" is a marriage of art and science. It's a project which not only shows, as its authors put it, images of the extraordinary in science, but actually uses the images to try to explain science, itself. As both a book and exhibition, "On the Surface of Things" sucks you in with its magnified photographs of surfaces, lurid blow-ups of everything from frost on glass to microelectrodes. But the photographs are being exhibited by major scientific institutions because science is the inspiration here and the reward for your curiosity. Here at last, or at least in school, are answers to embarrassing questions like why does water form drops. So why does it? Well, joining us now to explain this image, among others, are the co-authors of "On the Surface of Things." Felice Frankel is a photographer. Her pictures have made the cover of numerous magazines. And she now directs a National Science Foundation Project at MIT called "Envisioning Science." Harvard's George Whitesides is a chemistry professor Frankel met while on a design fellowship. He led her through the world of science and is the tour guide who will take us through the photographs. And, welcome to you both.

GEORGE WHITESIDES, "On the Surface of Things:" Thank you.

PAUL SOLMAN: Ms. Frankel, what drew you to this collaboration?

FELICE FRANKEL, Photographer: Do you have four hours?

PAUL SOLMAN: No.

FELICE FRANKEL: I'll tell you quickly that science has always been in my heart, if I could be that heartfelt about it. In fact, in PS92 I wrote that I was going to be a chemist when I grew up.

PAUL SOLMAN: This is a public school in New York.

FELICE FRANKEL: A public school in Brooklyn, New York. I majored in Biology in college and then left science after working in a laboratory and became a photographer. But somehow through various situationsI wound up in a wonderful situation to introduce myself to George at Harvard University as an adult. At that point I was 47 years old--as an architectural and landscape photographer--and found this faculty associate, who is obviously very visual in how he expresses himself. And he then introduced me to some of his co-workers in his laboratory, and that's how it all started.

PAUL SOLMAN: So you sort of sidled up to the scientist you always wanted to be or something?

FELICE FRANKEL: Exactly. That's exactly it. And I've come in through the back door in a way, back to science.

PAUL SOLMAN: So, Professor Whitesides, why do you wind up annotating a book of photographs as a Harvard scientist?

GEORGE WHITESIDES: Felice had, I think, a wonderful idea in this book, which was that science is interesting and a way to make it interesting to people who are not necessarily technically detailed in their science is to put together a wonderful picture. If they're interested in the wonderful picture, then they might be interested in the explanation for why things work. And I'm here to try to explain why things work.

PAUL SOLMAN: Okay. Great. So let's go back to the picture of the drops of water that we have here. And so, why does water form drops?

GEORGE WHITESIDES: A terrific question. The way to think about the problem is a little bit to anthropomorphize. It's helps a lot, and think about water as a collection of molecules. There are the molecules that are on the outside border, and then there are the molecules of water that are on the inside of the drop. And for some interesting reasons the ones that are on the outside never want to be there. They always want to be on the inside.

PAUL SOLMAN: They're being pulled.

GEORGE WHITESIDES: They try to retract their borders. And so you can think of a drop of water as if it had a kind of elastic skin like a balloon. And what it does is simply to shrink that skin as much as it can. So a drop of water tries to be a sphere. That's the smallest area it can form. Though, sometimes it gets attracted to the surface, and it spreads out a bit. But the basic idea is molecules on the outside want to be on the inside, and they crowd in.

PAUL SOLMAN: So they're pulling themselves around.

GEORGE WHITESIDES: Pulling themselves around and in, sucking in their stomach.

FELICE FRANKEL: The way this picture happened was that George and I sat down and we kind of went through a whole litany of what we should include in the book, and certainly George encouraged me to talk about drops of water. So then I had to come up with a picture of drops of water. That is the result. It actually looks quite simple. It wasn't as simple as it looks.

PAUL SOLMAN: What is the water on?

FELICE FRANKEL: It's on a gold surface that is somewhat hydrophobic.

PAUL SOLMAN: Hydrophobic meaning-oh, it doesn't let the water spread out.

FELICE FRANKEL: Exactly.

PAUL SOLMAN: It doesn't attract the water the way-

GEORGE WHITESIDES: Hates water-

PAUL SOLMAN: --Hates water, I see-hydrophobic.

FELICE FRANKEL: And there it is.

PAUL SOLMAN: What's the scale of these things? You brought along some stuff for us.

FELICE FRANKEL: Something like this, for example. I don't know which one would you like to-

PAUL SOLMAN: Why don't you do the agate there.

FELICE FRANKEL: The agate is kind of very nice to look at just as it is. But on the image that we finally wound up with, it's kind of enlarged, I would say, about five times.

PAUL SOLMAN: Five times. And what about the next rock there, that's opal?

FELICE FRANKEL: This is opal, yes, and this edge, I just took a section of the opal to emphasize the beauty of the diffraction of light that's taking place.

PAUL SOLMAN: How much of the opal is in what we're seeing in the picture?

FELICE FRANKEL: Well, you're seeing about, oh, about a half an inch of it. That's about the scale of that.

PAUL SOLMAN: What about the square drops of water? We have square drops of water. How are you--

FELICE FRANKEL: That really is how this all began in a way. This is the first attempt I made in George's lab to photograph his work. And what you're looking at is square drops of water, and each side of that-one of those drops measures about four millimeters. They're colored. We put a fluorescing dye in the water to emphasize that they are keeping their square shape.

PAUL SOLMAN: Okay. Now so, Professor Whitesides, how could it be that there are square drops of water if they're all trying to gather in and make themselves round, or drops become round as a result?

GEORGE WHITESIDES: What we did in that particular experiment was to start with a surface which was hydrophilic-that is, water loving.

PAUL SOLMAN: Not hydrophobic but hydrophilic. Okay.

GEORGE WHITESIDES: So, the drops in that case want to spread. But what we do in that particular system is to draw lines of, if you like, a paint on the surface, which the water can't cross. And what's interesting about the lines of paint is they're about a micron across, meaning about a hundredth the width of a hair, so that the drop extends as far as it can, but there's this very tiny stripe that it can't cross, so it goes as far as it can within that square set of lines and stops.

PAUL SOLMAN: I see. So that's why it's rounded at the corners there.

GEORGE WHITESIDES: It's rounded at the corners, because it's trying to be round.

PAUL SOLMAN: Right. That's what I meant. What about ink bleeding? My God, it looks like a great painting.

GEORGE WHITESIDES: That's part of the same kind of phenomenon. What happens when inks bleed is that there's a drop of liquid, that's the colored ink, and in that case the attraction of the fiber over which it's spreading is greater than the cohesion of the drop so that the surface is pulling the liquid away from a drop into a thin film. It's covering itself with that film of water.

FELICE FRANKEL: And that's an example of my saying, George, I want to put this picture in the book, can we say anything about it scientifically? That's really how it went, back and forth.

PAUL SOLMAN: You can hear--the science of this is clear. Do you feel that there's art to it too? I mean, are you vying with him?

FELICE FRANKEL: Always. No. I think we're connecting the two. I'd like to think of it-I think of it as creating a bridge between art and science.

PAUL SOLMAN: Because you're composing this picture, just as any artist would, right?

FELICE FRANKEL: I suppose so. But in my mind I always have in my mind the science behind it. That's kind of what removes me from the artist perhaps.

GEORGE WHITESIDES: The composition also includes the idea that the science has to fit into something that's explicable and that one can take a picture of. So there's composition in a sense in both directions.

PAUL SOLMAN: Let's look at Thero Fluid. I thought this was an amazing one. What's going on here, Professor?

GEORGE WHITESIDES: Now, this is a case where one is really causing the material a great deal of trouble. It's a mixture of two things. If you think about the drop, a drop wants to be the smooth, rounded surface. But this particular liquid has effectively small iron filings in it. And those, when you put them next to a magnet, tend to follow the lines. They follow the lines of magnetic force. And the liquid here is trying to do both at the same time. It's trying both to bead up as a ball and also to produce the lines of iron filings that stick away from the surface. And what you see is a compromise.

PAUL SOLMAN: So those spikes, or something, that's the magnetic force pulling?

GEORGE WHITESIDES: Right.

FELICE FRANKEL: Exactly. And you might be interested that this look, this liquid, without all this fancy stuff next to it, is just a glob of ugly black color. What I did was I put a drop of this-measuring probably around two inches-on a piece of glass under which I put a yellow post-it and under the post-it are seven circular magnets, and that's creating the pattern. And if you also look carefully, you could see windowpanes, which is the light that I used, the available light.

PAUL SOLMAN: I see, reflected in--

FELICE FRANKEL: You see reflected. And then I also bounced back some green-a green card to kind of add a little color in there.

PAUL SOLMAN: Wow! So you're really painting with this stuff.

FELICE FRANKEL: I played with it, yes.

PAUL SOLMAN: Professor Whitesides, has this changed your notion of how accessible science can be for the lay public?

GEORGE WHITESIDES: Absolutely. What we have found in thinking about problems in the fashion that Felice has outlined is that if one-if we are able to put together a part of a project which leads to an arresting image, then everyone is more interested, the scientist and the non-scientist. And building that idea into the beginning of a project not only helps to understand how to make it interesting to the scientific and non-scientific communities, but it also causes us to think a little bit how about to bring enough control into the experiment that we can build in the color of the composition or the form that might lead to an interesting picture. And that as an exercise for the students who are doing the work is a very useful thing to do as well.

PAUL SOLMAN: Well, thank you both very much.

GEORGE WHITESIDES: Thank you.

FELICE FRANKEL: It's a pleasure.

JIM LEHRER: "On the Surface of Things" is now on exhibit at the Edgerton Explore-It Center in Aurora, Nebraska.% ? RECAP

JIM LEHRER: Again, the major stories of this Monday, 700 people were confirmed dead from the Papua, New Guinea's massive tidal wave. The death toll could rise as high as 3,000, and the heat wave continued in much of the United States. Officials said at least 113 people have died from it across the South and West. We'll see you on-line and again here tomorrow evening. I'm Jim Lehrer. Thank you and good night.