The NewsHour with Jim Lehrer

ELIZABETH FARNSWORTH: Good evening. I'm Elizabeth Farnsworth. Jim Lehrer is off tonight. On the NewsHour, a debate on whether consumers are on a dangerous credit binge, a profile of NASA's high profile leader, Dan Goldin, a Newsmaker interview with Rep. Bill Richardson just back from North Korea, an update on refugees returning to Rwanda, and the week's politics with Shields & Gigot. It all follows our summary of the news this Friday.NEWS SUMMARY

ELIZABETH FARNSWORTH: The Justice Department today rejected a request from an independent investigation into Democratic campaign contributions. Five congressional Republicans had asked Attorney General Janet Reno to appoint an independent counsel to look into campaign donations from foreign sources. The Republicans wanted to probe into whether federal criminal laws had been broken by President Clinton, Vice President Gore, and Democratic National Committee officials. In a letter, the Justice Department said the request failed to meet the requirement of specific credible evidence that a person covered by the Independent Counsel Act had committed a federal crime. In economic news today, the government reported personal income was unchanged for the month of October, but personal spending rose by .5 percent. The Commerce Department said in a statement, spending went up to pay for services such as home insurance, telephone bills, and recreational expenses. Holiday shoppers took to the malls today on what is traditionally considered the busiest shopping day of the year. Bargain hunters lined up in the dark, waiting for stores to open. Retailers vied for customers by opening as early as 5 AM and attempting to offer the lowest sale prices. Officials at the National Retail Federation said consumers last year did 16 percent of their Christmas shopping the day after Thanksgiving. This year, there are five fewer shopping days between Thanksgiving and Christmas. We'll take a look at consumer spending and the debt right after the News Summary. In the Hague today, a United Nations court send a soldier to prison for war crimes committed in Bosnia. We have a report from Judith Burns of Independent Television News.

JUDITH BURNS, ITN: Drazen Erdemovic today became the first person to be sentenced by an international war crimes tribunal for half a century. He had pleaded guilty to taking part in the massacre of over a thousand unarmed Muslims at Srebrenica in 1995. Today, Judge Claude Jerodasz said the courts had taken into account Erdemovic's low military rank, his remorse, and the fact he provided essential evidence against Ratko Mladic and Radovan Karadzic, both indicted by the courts on war crimes charges.

GRAHAM BLEWITT, Deputy Chief Prosecutor: [speaking from The Hague] He had assisted our own investigations very significantly. He gave evidence publicly in the Karadzic and Mladic hearing some months ago. He led us to mass grave sites that we did not even know about, and they were exhumed during this past summer.

JUDITH BURNS: In July 1995, the Bosnian Serb army, under the command of Gen. Mladic, overran the United Nations safe haven at Srebrenica. Up to 8,000 unarmed Muslim and Croat men were separated from their families and shot. Erdemovic, a Croat soldier serving in the Bosnian Serb army, admitted shooting up to 70 people at a farm near the city. In his evidence, he said that when he protested, he was told to line up with the victims and be killed too. In Sarajevo today, a spokesman for the Bosnian government condemned the sentence as too lenient.

MIRZA HAJRIC, Bosnian Government Spokesman: I don't believe personally--and this is my intimate feeling--that a person who has been convicted for more than a hundred murders of innocent civilians should be sentenced to only ten years of jail.

ELIZABETH FARNSWORTH: One hundred thousand protesters marched in the streets of Belgrade today. It was the 12thstraight day of demonstrations against the Milosevic government. The marchers turned out, despite sleet and bitter cold. They vowed to continue their protests until Milosevic acknowledges an opposition victory in local elections. Police did not try to restrain the marchers. Ambassadors from a dozen nations meeting in Ottawa today approved a relief operation for Rwandan refugees in Eastern Zaire. The force would be much smaller than the 10,000 troops originally envisioned, but the exact size of the operation has not been worked out. Western aid officials say at least 200,000 displaced people remain in Zaire. Around 600,000 have returned to Rwanda. We'll have more on the story later in the program. Algerian voters approved a new constitution in a national referendum yesterday. It bans politicians from campaigning on the basis of the Muslim faith, the Arab, or Berber languages, gender issues, or regional differences. Opposition parties said the elections were rigged. The Armed Islamic Group, a fundamentalist guerrilla movement, had threatened to disrupt the elections, but Algeria's president said a tight security operation prevented any problems with the vote. He added that 80 percent of the Algerian people voted. In Paris today, truckers' unions signed a deal with employers to end a 12-day strike. Drivers lifted most of their roadblocks around the country. Both sides signed five accords, including key agreements raising sick pay and lowering the retirement age. Up to 5,000 gas stations across the country were out of gas Friday, or running low because of the truck blockade. Two astronauts aboard the space shuttle Columbia were forced to cancel a planned six and a half hour space walk last night because a hatch leading to the cargo bay was stuck. The astronauts struggled more than two hours to get the hatch opened but couldn't turn the handle. Ground crews studied video of the hatch to try to solve the problem. If they do, the walk could take place as early as Saturday night. The shuttle is scheduled to return to Earth next Thursday. We'll have more on the space program later in the show. And that's it for the News Summary tonight. Now it's on to a consumer credit debate, NASA's controversial leader, Rep. Bill Richardson on North Korea, an update from Rwanda, and Shields & Gigot. FOCUS - CREDIT CRUNCH

ELIZABETH FARNSWORTH: First up tonight, mounting consumer debt. Paul Solman has that.

PAUL SOLMAN: Retailers had high hopes today, as customers pulled out their credit cards to kick off the busiest shopping season of the year. Holiday sales historically account for about half of retailers' annual sales and profits, but are shoppers already too heavily in hock? Consumer debt, which includes credit card charges and auto loans, but not home mortgages, has risen to 1.4 trillion dollars nationwide. Moreover, the annual rate of consumer debt has been growing twice as fast as wages and is now roughly 20 percent of annual income. Finally, estimates show that by the end of the year, there will be more than 1 million personal bankruptcies in 1996, passing the previous high of 1992, when a recession was just ending. How big a problem is consumer debt? To discuss that, we're joined by Lawrence Chimerine, an economist at the Economic Strategy Institute and consultant for MasterCard International, and Robert Manning, an economist and sociologist at American University. Gentlemen, thank you both for coming in. Mr. Manning, first and foremost, do we have a consumer debt problem?

ROBERT MANNING, American University: Well, as you noted by the statistics of 1 million bankruptcies, it's clear that certain consumers have found the limits about how much more they can charge. Of course, the key issue is: Why have they reached that limit, and why has it taken down the long road of bankruptcy?

PAUL SOLMAN: Is that the only statistic you would cite? Are there others? Are there other ways looking at it, besides just personal bankruptcy?

ROBERT MANNING: Well, no. We've seen a rather startling increase in terms of total debt, in terms of household income. And consumers have jumped up in the last 15 years from about 80 percent of personal debt to almost 95 percent of household income.

PAUL SOLMAN: That's total debt. That would include mortgages, I take it?

ROBERT MANNING: Yes.

PAUL SOLMAN: And just credit card debt, or consumer debt at net of mortgages?

ROBERT MANNING: Well, one of the big issues about credit cards today is they've gone from being a charge card to an all purpose, consumer loan. So one of the issues is that credit cards really obscure the many different reasons that consumers are getting a much higher limit on their credit cards today.

PAUL SOLMAN: So are you worried?

ROBERT MANNING: Oh, I think it's very clear today that as wages have stagnated and Americans are seeing tremendous increases in certain costs, such as higher education, college for the kids, or the parents that are retired and contracting Medicaid and Medicare, that there are some costs that clearly can't be anticipated and be covered by existing wages.

PAUL SOLMAN: So that the problem--there is a problem with the level of debt we've got.

ROBERT MANNING: What we're seeing is that different groups now are finding that they've reached their capacity without an existing warning signal.

PAUL SOLMAN: Okay. Mr. Chimerine.

LAWRENCE CHIMERINE, Economic Strategy Institute: Paul, there is a problem for some groups. There are some people who have over- borrowed, and there are some people who have lost their job, as part of the wave of corporate downsizing we've had, or had an income squeeze, and are having difficulty servicing their debt. But these were relatively limited problems. The debt problem for the population at large is way overstated. In fact, the statistics, themselves, are overstated.

PAUL SOLMAN: Explain what you mean by overstated.

LAWRENCE CHIMERINE: Well, Bob mentioned, himself, the changing role of credit cards, but what he didn't mention is the fact that credit cards increasingly are being used as a method of payment. That's the biggest change in credit cards over the last ten to fifteen years. That's substituting for cash and checks and the payments process. And some of that substitution, some of that payment use of credit cards shows up in the debt statistics, but it's really not bad. It just takes time before you get the bill in the mail and pay your credit card bill.

PAUL SOLMAN: You mean, so the numbers he's talking about are a total number that include something that used to be done in cash.

LAWRENCE CHIMERINE: That's exactly right. It includes ordinary payment transaction use of credit card that inflates the debt statistics. When you look on an overall basis nationwide, credit levels are not extraordinarily high, particularly in view of interest rates coming down, so it's easier to service the debt. It's coming down right now, even on home mortgages, which frees up purchasing power. A lot of the credit card increase indirectly is being used to finance the purchase of financial assets. That's not very different than if you go out and use it to pay for vacations or something.

PAUL SOLMAN: Okay. But I mean, a million bankruptcies? I mean, it sounds scary.

LAWRENCE CHIMERINE: This is a long-term trend. It's something to be concerned about. But bankruptcy is increasingly coming--becoming a first option in this country, not the last resort it used to be. Lawyers are promoting bankruptcy. A lot of them are caused by divorce, by unanticipated medical bills, by job loss. Bankruptcies have been rising faster than debt for the last 15 years.

PAUL SOLMAN: Well, if you think it is higher than it has been and worrisomely high, why, if we accept your argument for a moment, is credit as high as it is? Why are so many people taking on what you think to be so much debt?

ROBERT MANNING: Well, I think what we're seeing in the United States, in general, and also in terms of the global economy in particular is there's fundamental restructuring. And, in general, in terms of economic change on the business cycle, we've seen working class groups that have really borne the brunt of economic uncertainty. For the first time now the middle class is now being forced to confront fundamental economic changes through downsizing, anxieties now where it's required that households must be two earners, and when one earner goes full-time to part-time, given the extension of the debt capacity now, a lot of consumers really don't have any maneuverability to persevere for a few months.

PAUL SOLMAN: Let me read you something. This is from "The Indebted Society," by James Medof, Andrew Harliss, and it says, "Consumers have to borrow"--it's a new book that's come out-- "consumers have to borrow to support a level of consumption they've come to anticipate, is that right?

LAWRENCE CHIMERINE: Yeah. There's no question. And I think this is what Bob is saying, that this is a macroeconomic issue, Paul. It reflects the downsizing, the growing income disparity and wealth disparity in the economy, the fact that a large portion of the population have fallen behind in the last 15 years.

PAUL SOLMAN: And that's what Medof and Harliss are talking about.

LAWRENCE CHIMERINE: Even though the economy overall has been growing. These problems are having financial difficulties not necessarily because they borrow too much, because of the fact they've lost income.

PAUL SOLMAN: Let me ask you a question. Are banks lending too easily, and is that part of the problem?

LAWRENCE CHIMERINE: Sure.

PAUL SOLMAN: We at our house are flooded with these credit card solicitations. My 16-year-old daughters gets these things.

LAWRENCE CHIMERINE: Paul, there are some people who are probably getting credit cards who shouldn't, and some people are not using them wisely. But what's happening with credit card solicitations is primarily the working of a very competitive industry. They're trying to take business away from somebody else and in the process, some people, as I say, are probably getting cards who shouldn't have them, but this is a small portion of the population.

PAUL SOLMAN: What do you think about that, Mr. Manning? Are people getting suckered into or lured into this? I read that 64 percent of all college students have credit cards, which seemed, given their income, to be a high number.

ROBERT MANNING: The real problem is that the banking industry has found themselves between a rock and a hard spot after financial deregulation. And as a result, credit cards are more profitable, at least two and a half to three times any other parts of their portfolio.

PAUL SOLMAN: Why is that?

ROBERT MANNING: Because with the decline in real interest rates, consumer loans have become incredibly profitable, combined with the dramatic transformation in terms of credit card technology.

PAUL SOLMAN: So I mean, how much does a credit card typically charge on a loan?

ROBERT MANNING: About 17 percent.

PAUL SOLMAN: Versus I guess 8 percent on a home mortgage or an auto loan or something like that?

ROBERT MANNING: Oh, clearly, without productibility.

LAWRENCE CHIMERINE: But they're unsecured, and secondly, don't forget, most people are using credit cards, they're using them as a method of transaction, not to borrow. Not everybody is paying 17 percent because most people just pay off their balances on a regular basis.

ROBERT MANNING: Yeah. But the problem with that whole issue is that those people that can least afford to borrow are the ones who have to pay 18 percent.

PAUL SOLMAN: Explain that.

ROBERT MANNING: In other words, working class people or middle class people in debt are going to be paying 18, 20 percent, the highest interest rates, when those people that pay off at the end of the month are effectively subsidized by those people that carry a balance at the end of the month. So instead of banks charging people maybe 6 percent that it costs them to have that account, they'd much rather gouge people at 17, 18 percent, who don't pay, and let what they call the free riders get off loose.

PAUL SOLMAN: Do you see that as a problem? Or is there an upside to that?

LAWRENCE CHIMERINE: There's no question, Paul, that some people who are carrying more debt than they should, for whatever reason, and carry debt on a regular basis on their credit cards, are paying high rates. These same people, though, if they took out other loans, would pay the very high rates on those loans, as well. They're higher risk borrowers who are going to be charged higher rates for lending, regardless of what vehicle they take.

PAUL SOLMAN: What about the fact, the question of democratization here, I mean, that is if more people can get credit cards, I suppose that would mean that it's, you know, a more democratically- available line--lines of credit for people?

ROBERT MANNING: Well, one of the problems with the economy right now is the people that really need loans aren't getting them. Small businesses--and I have a whole chapter in my book about how small business people can't get an 8 percent loan--and the bank will turn around and give them an 18 percent credit card.

LAWRENCE CHIMERINE: I think Bob's making a very interesting point. I tend to agree with the thrust of your question, Paul. Credit cards have essentially democratized the availability of credit in this country, plus with the CRA program on home mortgages--

PAUL SOLMAN: CRA--

LAWRENCE CHIMERINE: This is the Community Reinvestment Act, which essentially requires banks to make some mortgage loans available to lower income families. Ten or fifteen years ago, these lower- income and higher-risk families could not get access to any credit. And now at least they do get credit cards; they get home mortgages. Some of them can't manage wisely, but the bulk of them do, and I think you're dead right. It is democratized credit and in the process I think improved the quality of a lot of families' lives.

PAUL SOLMAN: So democratized or suckering people into it?

ROBERT MANNING: Well, the problem is we haven't addressed the fact why 18 percent--I mean, why couldn't we democratize credit card rates at 10 percent and have a real equitable, free distribution, where people are getting resources that they pay for, instead of being charged double-digit rates?

PAUL SOLMAN: Well, let's look just for a second at the holiday season and what does this all imply. And we haven't gone out and checked the cars in the mall. I know. I asked both of you before hand. But what doe you think this implies? Are people credit-they got stuck with their credit up to here, so they can't buy anymore, and we'll have a weak season?

ROBERT MANNING: Well, what we're seeing right now is that the credit card industry is going to be pulling our heartstrings here, and they're going to be sending us low interest rates, they're going to be telling us we can skip a payment this month, we may only have to pay 1 1/2, 2 percent, and not tell consumers that it may take them 34 years to pay off that balance if they only submit a minimum payment.

PAUL SOLMAN: So if they keep making those offers, then people would be buying this holiday season, I take it?

LAWRENCE CHIMERINE: Paul, the biggest driver of spending is income growth, is wages and salaries, and other income. It's the availability of jobs. It's how people feel about their job security, confidence in the future of the economy, inflation. All of these factors are plus now. The confidence numbers are at all- time high levels, which suggest, by the way, people are not only concerned about their debt levels. We'll have an okay Christmas. It won't be a boomer because the financial conditions don't support that. But all the factors suggest moderate growth in spending. For some families who have high debt, they may have to cut back a little, but for the bulk of the population, spending will exceed last year by a moderate amount.

PAUL SOLMAN: Well, thank you both, gentlemen, very much for coming in today. FOCUS - NASA CHIEF

ELIZABETH FARNSWORTH: Next, changes at NASA. Tom Bearden reports on the space agency's high-profile leader, Dan Goldin.

DAN GOLDIN, NASA Administrator: It's very exciting being here, and I want to tell you a little bit about what your future is going to be like.

TOM BEARDEN: It happens a hundred times a year--an audience, a microphone, and Dan Goldin up there on his pulpit, a gleam in his eye, preaching the gospel to anyone who will listen. The message is about space, but, more importantly, about the future.

DAN GOLDIN: When you get assignments in school, don't just try and do the homework that the teacher asks you to do. Go a little bit beyond that, to always expand your mind, and maybe somebody in this room will be the first person to step foot on Mars, because you're the right age.

TOM BEARDEN: That gleam in the eye has taken Dan Goldin from a poor neighborhood in the Bronx to become the most controversial person ever to run the National Aeronautics & Space Administration. Goldin was hired in 1992 by the Bush administration. NASA was in serious trouble them. Congress was on the verge of canceling the next big project, the space station. Goldin's assignment was to reshape the agency for the fiscal realities of the 90's. So Goldin shook NASA to its core. He performed radical surgery on the personnel roster and pushed those who remained toward ever-riskier projects.

DAN GOLDIN: NASA was formed as a development organization, research & development organization, to always push back boundaries of the unknown, not to be an operational agency, not to do routine things that are comfortable, but to always go to the edge, and to take risk.

TOM BEARDEN: Goldin has a mantra for NASA: faster, better, cheaper. He repeats in appearances before private industry and NASA employees alike and usually adds a coda.

DAN GOLDIN: And design a little, build a little, fly a little, and crash a little, it's going to be acceptable.

TOM BEARDEN: The physical manifestation of his philosophy is the X-33. Now in early wind tunnel tests, it's an experimental vehicle to explore new technologies that may lead to the Holy Grail of space flight, getting to orbit in a single vehicle. Scientists have been dreaming about it since the days of Werner Von Braun. Every spacecraft that has ever left the Earth's gravity got there on a multistage rocket, including the giant Saturn moon rocket. It's because a single rocket was simply too heavy to heave itself into orbit. So a massive first stage went part way, ran out of fuel, and dropped away, while successive stages repeated the process. The X-33, by contrast, is a very different vehicle. The whole thing goes to space and returns. It doesn't have wings like the shuttle, because the whole thing is shaped to work like one giant wing. No giant rocket bells but rows of little nozzles, like a harmonica. They'rethe exhaust ports for a new kind of engine called the aerospike. It'll be able to lift itself into orbit because it'll be much lighter, made largely of composites, instead of metal. That includes the propellant tanks, which will be part of the structure, instead of inside of it. Nothing like this has ever been built before.

TOM BEARDEN: How serious are the technical challenges that remain to make the X-33 work?

DAN GOLDIN: Very tough. But I ask you this: When John F. Kennedy said, We're going to the Moon in eight years, and we're going to make it happen, people eye's were spinning, but you know what happened? America said, God, that's what we're about, and maybe the first vehicle will crash, and maybe we'll have to build some more vehicles, and maybe we'll have to get some new materials, but I am absolutely convinced ten years from today, we will improve the reliability on launch by a factor of a hundred, and we're going to cut the cost at least by a factor of ten.

TOM BEARDEN: Given what happened after the "Challenger" accident, do you think the public is prepared to accept that kind of crash?

DAN GOLDIN: You know, we had our tears, I had my tears over the "Challenger." But we flew again. We can't afford to lose our heart and soul when we have crashes.

TOM BEARDEN: Goldin also believes NASA can't afford to put all of its scientific eggs in one basket. Before he came to NASA, scientists spent years developing Battlestar Galactica-style spacecraft for planetary missions. The science was impeccable, but the problem was the spacecraft were becoming prohibitively expensive. After the billion dollar Mars Observer disappeared in space in 1993, Goldin commissioned much cheaper missions that could be built much more quickly, like the Mars Global Surveyor, which was launched in early November, and the Mars Lander, launching on Monday. They'll use innovative techniques and are somewhat risky but only cost a quarter as much as the Observer. Goldin recruited scientist Charles Kennel as an associate administrator to help him implement policies. He's since left the agency. CHARLES KENNEL, Former NASA Associate Administrator: In many cases, you know, there's much more--it's very unsettling, and the engineers and bureaucrats and administrators didn't know whether they could actually pull it off at the low prices that we were having to shoot for. And, as it turns out, I think to Dan's great credit, the NASA science program continues to exist with its essence intact, and, in fact, in many ways, it's more flexible and more agile, and I think that we managed to improve the science while cutting the cost.

SPOKESMAN: We have the Unit three pressure fuel turbo pump, space shuttle main engine turbo pump--

TOM BEARDEN: Goldin also brought something else to NASA, besides a willingness to take risks, a management style the likes of which the agency had never seen before. It earned him the cruel nickname "Captain Chaos" from people who say his pushy impatience is often counterproductive. Some call him abrasive, brutal, even paranoid. But others inside and outside the agency also call him brilliant, innovative, and a genius. Charles Force was an associate administrator who saw what happened when Dan Goldin's style ran head-long into NASA's corporate culture. CHARLES FORCE, Former NASA Associate Administrator: Dan comes in and says, gee, maybe we should explore Mars, which is outside of the Earth's orbit, so then the organization immediately starts building and planning a spacecraft to explore Mars, and the next thing he comes buy and says maybe we ought to go to Mercury instead, which is getting close to the Sun. And so to the organization, that's very difficult to cope with. And yet all he's trying to accomplish is to get people to consider for themselves.

DAN GOLDIN: Am I prepared to have a perception of chaos? You bet. A little discomfort is okay, not brutalizing employees, but discomfort. You must have a vision, and you must move towards that vision with focus. A little chaos doesn't hurt anyone when you're making progress.

TOM BEARDEN: But there's another factor at work that undoubtedly makes Goldin's style even harder to swallow for NASA employees. The administrator is under strict orders to downsize the NASA work force and infrastructure even as he tries to transform its mission. People are afraid a rift is coming. That's civil service jargon for a reduction in force, in other words, a big layoff. These people work at NASA's Lewis Research Center in Ohio. When they got together recently on a rainy evening for their annual union picnic, downsizing was on everyone's mind. Many we talked to said pressure from Goldin to act quickly led to bad decisions.

SHEILA BAILEY, Lewis Research Center, NASA: I think Dan Goldin had several options, of which he availed himself of only one. He had an option to thoroughly analyze and downsize in a realistic, logical way. I don't think he exercised that option.

TOM BEARDEN: Case in point, the Lewis Center once had its own fire department.

VIRGINIA CANTWELL, Lewis Research Center, NASA: Well, Sen. Edgar here and Mr. Campbell was told by the agency administrator, Mr. Goldin, to come up with a cost-effective plan to cut the costs within a two-day period. Well, of course, there wasn't time to do a cost analysis study.

TOM BEARDEN: So out went the fire department, but the firemen didn't go; they were reassigned. And nobody bothered to coordinate with the Cleveland area fire departments, who now had to take over responsibility for fire protection. Congress got wind of that story and asked NASA's inspector general to testify.

ROBERTA GROSS, NASA Inspector General: Where they fell down was in the transition process. They gave themselves a year to coordinate with the three jurisdictions that would be affected by Lewis. One fire chief found out about it because somebody happened to chat with him at a training and said, oh, by they way, you're going to be responsible for fire response and emergency responses. And they called Lewis and said, is that true?

TOM BEARDEN: None of this involved very much money, but it raised questions about how the changes were being carried out.

REP. STEVEN LATOURETTE, [R] Ohio: In this case, when we got down to that level of pressure, things could have gone better.

TOM BEARDEN: Goldin insists the results are what matter, even if the process is messy.

DAN GOLDIN: We don't have the leisure of doing studies completely defining it and then going public. Everyone watches us as we go. If you will, the public is in a sausage factory. When it's done, sausage tastes good, but it's pretty ugly as you go along. If we had to worry about a public relations situation, where everything has to go perfectly, we will be so bureaucratic we will accomplish nothing.

SPOKESMAN: The two biggest problems look like the thermal protection system and some weight issues and their--

TOM BEARDEN: Goldin and his associate administrators want their people to make quick decisions and fix mistakes later, instead of doing what he says NASA used to do, study a problem to death for fear of failing. Keith Cowing follows all of this in cyberspace. He's a former NASA engineer who set up an Internet site that functions as a kind of super water cooler for all of NASA's far- flung employees. He calls it "RIF Watch." It features rumors, editorial comment, jokes, cartoons. It also frequently publishes high-level internal memos that NASA employees send to Cowing. He says there are a lot of unhappy people out there in NASA Land.

KEITH COWING, RIF Watch: Dan Goldin's approach is he'll walk into--metaphorically--into a stockyard with a machine gun and shoot up all the cows. And somebody will come back later and say, now, where's that prize bull, and he'll hand 'em hamburger and say, here, put it back together; it's all there. Dan constantly changes things, but he never leaves them in place long enough to accomplish anything.

TOM BEARDEN: One NASA icon Goldin definitely doesn't want to leave in place is the space shuttle. He wants NASA to do research, not launch spacecraft. He's taken the highly controversial step of turning over all shuttle processing and launch operations to a single civilian contractor, the United Space Alliance. NASA hopes that'll slash the enormous costs and lengthy preparation time needed to prepare shuttles for their next flight. But some in NASA are deeply worried about that approach. Last summer, Cowing's RIF Watch turned up a memo from the Aerospace Safety Advisory Panel, an internal group formed after the "Challenger" disaster. It said the rapid transition to the contractor was a threat to safety. Goldin denies that.

DAN GOLDIN: We have set up a process that's very, very formal, very disciplined, in terms of transitioning from NASA to the USA Company, United Space Alliance, that will take over the shuttle. And at each point in the process, we have a place where anyone could stop it. We have independent oversight. But this is something that has to come. And just because there could be a safety implication doesn't say you shouldn't do it.

CHARLES KENNEL: After the "Challenger" accident, one of NASA's responses was to add ever more layers of control and checks and procedures before every shuttle launch. And, of course, the employment at the centers went--at Kennedy went up, and more and more, you had people checking people. But at a certain point you could arrive at the feeling that you were losing safety by having such a complex system.

TOM BEARDEN: Goldin not only wants NASA out of the launch business; he's actively encouraging small companies like Kelley Space & Technology, which is trying to develop a cheap launch system, using aircraft to launch a reusable orbital vehicle from high altitudes. No other NASA administrator has ever encouraged private competition.

DAN GOLDIN: So we at NASA really salute and applaud those that want to take risk. It's a different way of going at the space business. But I submit we had a 25-year experience where the governor was in total charge, and we played it safe and didn't develop one new rocket engine in America for 25 years, while in the rest of the world, they developed 29 rocket engines.

TOM BEARDEN: There is no question that Goldin's style and decisions have shaken NASA, but that's just fine with Mark Albrecht, the man who originally hired him.

MARK ALBRECHT, Former Director, National Space Council: Perhaps he could be a little more cautious; he could be a little studious; he could be a little more Washingtonian, a little more suave in handling all people, in all times, in all situations. But if I had to sacrifice some of the passion, some of the innovative thinking, some of the impatience and the qualities that I think are so important about Dan for a little more attentiveness to the niceties of existence inside Washington, I wouldn't make that trip for a minute.

TOM BEARDEN: Despite the conflicts and controversies, odds are that Dan Goldin will be one of the few high level administrators likely to continue in the second Clinton administration. Four more years of faster, better, cheaper, a prospect likely to bring both grins and groans inside America's new space agency.

ELIZABETH FARNSWORTH: Still to come on the NewsHour, Representative Bill Richardson on North Korea, an update from Rwanda, and Shields & Gigot. NEWSMAKER

ELIZABETH FARNSWORTH: Next tonight, the story behind the release of an American from North Korea. Charlayne Hunter-Gault has that.

CHARLAYNE HUNTER-GAULT: Evan Hunziker of Tacoma, Washington, had been in captivity in North Korea for three months. He was arrested as a spy after he swam across the Yalu River from China into North Korea. On Wednesday, Hunziker was put on a plane and sent home in time to spend Thanksgiving with his family. The man who helped organized Hunziker's release was Rep. Bill Richardson, Democrat from New Mexico. This was the second time in two years the congressman has helped gain the freedom of an American held in North Korea. Congressman, thank you for joining us.

REP. BILL RICHARDSON, [D] New Mexico: Thank you, Charlayne.

CHARLAYNE HUNTER-GAULT: Let's begin at the beginning. Who exactly was Evan Hunziker, and what was he doing in North Korea?

REP. BILL RICHARDSON: He was a young man, 27 years old, wanted to be a humanitarian missionary. He felt deeply that he wanted to rediscover his North Korean roots. He's half Korean. His mom is Korean. He unwisely swam across the Yalu River and had no passport, was captured by the North Korea police after being a couple of hours with some farmers on the North Korean side. And then he was detained for 90 days in a very severe incarceration center and charged with being a spy for South Korea, and at the time the North Koreans, up until we got Hunziker released, wanted $100,000 in bail money as a fine for this infraction of being in the country illegally and also for being a spy.

CHARLAYNE HUNTER-GAULT: Was there anything to substantiate the charge that he was a spy that you know of?

REP. BILL RICHARDSON: Well, he did sign a couple of confessions that indicated that, but it's our view that those confessions were signed under duress. He was very emotionally distraught when I saw him. A Swedish representative of North Korea also felt that he was under duress, that he was being seriously interrogated, although, in general, he was well treated and well fed.

CHARLAYNE HUNTER-GAULT: But you said he was in a severe prison and under severe--I forget the word you just used--but it was severe interrogation. What does that mean?

REP. BILL RICHARDSON: Well, that means that the North Koreans are very adept at psychological I won't call it warfare but interrogation where they exact from whoever they want--in this case a confession--and they wanted a confession, to come to us and say, look, this man was in our country illegally, he was a spy, and it's going to cost you $100,000 to get him out. Plus, the North Koreans at one point had threatened to try him for espionage, and that carries a seven-year penalty.

CHARLAYNE HUNTER-GAULT: But you're satisfied that he was not a spy?

REP. BILL RICHARDSON: I'm satisfied, and the U.S. Government is satisfied he's not a spy. He's a confused young man, good intentions, very idealistic, whostrayed in North Korea in an adventuresome frolic, and really, he paid for it with 90 days of his life in very severe conditions. And this--this incident also came at a time when U.S.-North Korean relations were in pretty bad shape because of this submarine incident in which North Korean commandos strayed into South Korea. So it was all a very tense period, and this is why the Department of State and myself, we wanted to put this incident of Hunziker behind us, so we could start talking about the other very, very important national security issues to reduce the tension in that Korean Peninsula.

CHARLAYNE HUNTER-GAULT: Just briefly--I want to get to that in a second, but how did you get him out and get them down from the $100,000 to what was it, $5,000 that was finally paid?

REP. BILL RICHARDSON: That's right. Well, it was very intensive negotiations. A lot of credit goes to the State Department that also was negotiating with me for the last 90 days. We were dealing with the North Korean mission at the U.N. agency in New York, and it took us three months basically to get the North Koreans to realize that we weren't going to pay that fine, because that would be a quid pro quo. That would be an admission of guilt. And what we settled on was $5,000 that the family paid for hotel costs, basically incarceration costs, over that 92-day period.

CHARLAYNE HUNTER-GAULT: Why do you think they released him? Was it the money?

REP. BILL RICHARDSON: No. I don't think it was the money. I think North Korea realized that they made a terrible mistake with this submarine incident, and they realized unless they released Hunziker, unless they made some kind of an admission of error and contrition over this submarine incident, which they haven't made by the way, but I think they're going to make, that unless they put those issues behind them, the United States and the international community was going to continue being leery of them, was not going to give them any food assistance at a time when they need it, that their bilateral negotiations with us on a nuclear agreement, where they get substantial heavy oil and light water reactor from South Korea and Japan which is in their intent, that all of that was going to evaporate if they continued some of these very warlike, and negative, and I would say intrusive initiatives like they did with that submarine incident into South Korea.

CHARLAYNE HUNTER-GAULT: All right. Let's just explain that briefly. That was when the North Koreans went into South Korea with a submarine that turned up on their shores, that people who were in the submarine turned up in South Korea.

REP. BILL RICHARDSON: That's right, Charlayne. Those were commandos, and this was a submarine that went into North Korean shores, disembarked over 20 North Korean commandos. It was certainly an aggressive act at a time that South Korea was giving them food assistance, we were having some prospects of peace talks with North Korea, South Korea, China, and the U.S., this very intrusive action took place.

CHARLAYNE HUNTER-GAULT: All right. Now, this is your second time in North Korea, as we just explained. Was anything different? Did you learn anything new about who was running the country, or what was on the minds of the North Koreans vis-a-vis some of these issues?

REP. BILL RICHARDSON: My sense, Charlayne, is that the North Koreans are run by the son of the former great leader. His name is Kim Jung-Il. But, nonetheless, he is not in total control the way his father was. I think that the military and security forces, that in many cases tend to be more aggressive than the civilian forces, still have not accepted the need for normalization with South Korea. They may accept the need for better relations with the United States, but they are unfortunately making provocative statements. Apparently, they made one today against the United States.

CHARLAYNE HUNTER-GAULT: That's right. They said that--they warned if the United States sided with Korea over the North Korean submarine and asking for an apology, there were going to be problems. Did you discuss that, and do you--

REP. BILL RICHARDSON: Yes, I did. And I think that's rhetoric. That's press rhetoric, that North Koreans negotiate like this. They feel that if they make provocative statements, make threats, that that gives them leverage in negotiation. That doesn't always work.

CHARLAYNE HUNTER-GAULT: But, excuse me. I just want to ask you quickly--they said earlier this month that this submarine incident could jeopardize the treaty on the nuclear weapons program that you mentioned earlier. Do you think that that's the case?

REP. BILL RICHARDSON: There's no question that unless North Korea makes a statement of regret or contrition on the submarine incident, that a lot of progress is going to be derailed, but my sense after being there, after negotiating with them, they held me for an extra day to talk about these issues that they wanted to get off their chest. My impression is that within the next two weeks that the North Koreans will make a statement of regret, because they know that they've got an awful lot to lose. Still, it's a very dicey situation there.

CHARLAYNE HUNTER-GAULT: Right. Well, Congressman, thank you so much for joining us, and congratulations on your achievement.

REP. BILL RICHARDSON: Thank you very much. UPDATE -GOING HOME

ELIZABETH FARNSWORTH: Now the story of a homecoming. Hundreds of thousands of Rwandan refugees are returning from two years of exile in Zaire. Lindsey Hilsum of Independent Television News reports from one town just inside the Rwanda border.

LINDSEY HILSUM, ITN: The cathedral at Nundo in Gisenyi. Rwanda is the most Catholic country in Africa. Nearly everyone goes to church. During the 1994 genocide, Tutsis and opposition Hutus ran to Nundo, seeking safety in God's house. Instead, they found death. Christians now worship in the same pews where 300 were killed on April 9, 1994, and another 200 on May 1st. Amongst the dead were 29 priests, holding an Easter meeting. In the congregation today, survivors, newcomers, returning refugees, maybe killers. People arrive during the service. Stephanie Hanyorinvora has made the long walk back from two years of exile in Zaire. She goes to church before going home. She told us at the time she knew nothing about the slaughter of Tutsis by her fellow Hutus, led by the extremist militia. She walks past the sign saying, "All who enter this church remember those who are killed and buried here." Susanna Nyiratagorama is one of the few Tutsi survivors in the area. She was hidden by Hutu friends while the killings continued around her.

SUSANNA NYIRATAGORAMA: [speaking through interpreter] The people who died came from all around this area. Their houses had been destroyed--some had been killed. The bishop brought the survivors to the Cathedral. There were many. Some of my family were amongst them. Some were then killed inside the church and some outside.

LINDSEY HILSUM: Prayers for the souls of the dead can't assuage the fears of the living. Susanna's sister and her husband survived the genocide, only to be killed two months agoby armed men attacking over the border from Zaire. Susanna believes her sister was targeted as an eyewitness who might report the authorities killers amongst the returning refugees. The 1/2 million returning Hutu refugees will find fear and mistrust felt by survivors like Susanna awaits them at home.

SUSANNA NYIRATAGORAMA: [speaking through interpreter] I don't think you can imprison everybody but nearly everybody participated. Even children killed; they killed other children. Even the women killed other women. Can you imprison everybody--even the women?

LINDSEY HILSUM: Rwanda's justice system is stalled. Many Hutus have been imprisoned, accused of genocide; none have been tried. Some have been killed, some falsely accused because of disputes over property or land. The survivors fear the returning refugees. The refugees fear vengeance from the survivors, or Rwanda's Tutsi- led government. Jean Uwamungo returned her from the refugee camp last weekend, one of the first, because he's luckiest enough to own a bicycle. Susanna wants to know who else is coming home from the camp. Jean brings news of people she hasn't seen for two years, Hutus who will be her neighbors again. But even as the two were talking, two other villagers separately whispered to us that Jean was an Interhamway, a member of the Hutu militia which led the killing, an allegation which may well be untrue but which shows the degree of suspicion and mistrust. Everyone wants to know what the returning Hutus have to say. We asked whether the authorities at the border had questioned Jean.

JEAN UWAMUNGO: [speaking through interpreter] They asked me, were you a soldier? I said, no, I used to work in someone's house. They saw me passing without fear. I got through with no problems. Nobody said I was bothering anybody.

LINDSEY HILSUM: But it's back in the community, where secrets are hard to keep, that over the next few months questions will be asked. Even Jean says some killers have returned.

JEAN UWAMUNGO: [speaking through interpreter] I can't say exactly who because everybody's come. Soldiers, civilians, everyone.

LINDSEY HILSUM: Susanna says there's nothing she can do but live with the fear and hope the government will protect her. Jean knows that coming home doesn't necessarily mean he'll be allowed to rebuild the life he left when he fled two years ago. FOCUS - POLITICAL WRAP

ELIZABETH FARNSWORTH: Finally tonight, political analysis from Shields & Gigot. That's syndicated columnist Mark Shields and "Wall Street Journal" columnist Paul Gigot. Mark, the Justice Department today rejected the request to turn over the investigation to an independent counsel, the investigation of the Democratic fund-raising from foreign sources. What is your reaction to that decision?

MARK SHIELDS, Syndicated Columnist: Well, first of all, I don't think that--two things will happen: One, we will have congressional hearings. I think they're guaranteed now on all the contributions the Democrats and probably to all of the recipients. But, secondly, Janet Reno stands as the attorney general of the United States as sort of an unsalable figure, in spite of all the unsubtle hints from those courageous, nameless, faceless folks in the Clinton White House who want her to go. I mean, she has a record of independence, having appointed four independent counsels already, more than anybody else in the first term in history, she is--she is just in a position I think of strength here. She's announced that there will be a task force already appointed, already working, of career prosecutors, and I'm willing to put it right now that there will be indictments and prosecutions from their work.

ELIZABETH FARNSWORTH: So instead of seeing this as the Justice Department trying to whitewash something, you see it as just trying to take, in itself, a responsibility, instead of giving it to an independent counsel?

MARK SHIELDS: And I think she can make the case--Joe DeGenova, the former U.S. attorney here, himself a former special counsel, independent counsel, makes the point that John Huang, who's most prominently identified, the fund-raiser who had been at the Commerce Department, then went over to the Democratic National Committee, was not of high enough rank to merit--justify an independent counsel being named for him, and he's the most identifiable, targeted figure, it seems at this point.

ELIZABETH FARNSWORTH: Paul, what's your reaction to the Justice Department announcement today?

PAUL GIGOT, Wall Street Journal: Well, maybe this means that Janet Reno will be able to keep her job in the second term. As Mark suggested, there were an awful lot of people in the White House. There are an awful lot of people who whispered that they were unhappy with her, that they would want her replaced, that maybe even the President wanted her replaced, because she did have this first-term record of appointing four special counsels. They thought she was a little bit too independent. But I don't think you can fault Janet Reno on this one. As Mark suggested, there's a very narrow band of people within the special counsel statute who are covered, and John Huang was assistant secretary of commerce, which is usually not raised to that level. And she has enough standing, I think, Gen. Reno does, with Republicans, that this won't go over too badly, as long as you can have congressional hearings, and the Justice Department, itself, will continue to investigate.

ELIZABETH FARNSWORTH: And do you agree that the congressional hearings are inevitable?

PAUL GIGOT: I think so. Absolutely. And they should. We shouldn't criminalize everything in our politics. We ought to have accountability based on information and rooting out facts, and that's what congressional hearings are supposed to do.

ELIZABETH FARNSWORTH: Mark, just briefly on the independent-- staying on the independent counsel, James Carville, who helped run the Clinton campaign in '92, said on "Meet the Press" last week that he's forming what he called--it's a committee to "inform the public about Kenneth Starr," the independent Whitewater counsel, about Kenneth Starr's alleged lack of fitness for the job. What do you make of this news?

MARK SHIELDS: Well, I mean, James Carville certainly cannot be accused of having an arm's length relationship from the White House. He was the principal strategist, the architect of the 1992 Clinton victory. He's been a loyal champion advocate, supporter, and adviser to the President. So in that case--

ELIZABETH FARNSWORTH: Although, I should say he claims that the President was against it. He calls what the President's doing appeasement.

MARK SHIELDS: Well, I think, I mean, James Carville has had a thing about Ken Starr for quite a while. I think there's two things at work here. I mean, Carville is a very shrewd political person. He knows the risk. He knows the criticism. He's already received a lot of criticism, and pretty damning criticism, but I think, Elizabeth, what he's doing is he sending a sort of a telegram, a Western Union telegram to Ken Starr, that everything that they're doing is being scrutinized and will be scrutinized and will be ventilated, but secondly, I think there may be a secondary constituency he's trying to send a message to, and that's any potential juries that are sitting on charges brought by Ken Starr in both Little Rock and Washington, D.C.. There may be a little Johnny Cochran twist to the Carville approach.

ELIZABETH FARNSWORTH: Paul, do you have any comments to add on that?

PAUL GIGOT: He's clearly trying to taint whatever possible indictments Ken Starr would bring with partisanship, with the charge that he is a right wing Republican hack, despite the fact that he's none of those things. He is a Republican, but he's certainly someone--one of the least partisan Republicans in the Judiciary--judicial circles in Washington. He's trying to do that. There's no question about it. And there's a great irony here, because in the first term the President often said, well, if there's anything wrong that's gone on here, Ken Starr will find out. He was using Ken Starr, the special counsel, as a shield in a way against politics. Now that the election is over, you have Carville saying, essentially, well, using politics against Ken Starr, that anything he does is tainted. So it seems to me that that's a very clear message he's sending, and if the President wants to distance himself from that message, he could say so publicly.

ELIZABETH FARNSWORTH: Paul, earlier this week, Senate Minority Leader Tom Daschle seemed in comment to reporters to distance himself and Senate Democrats a little bit from the President. He said, for example, that he would support a partial ban on late-term abortions, whereas, the White House I think just wants to let that lie. What do you think that Sen. Daschle was doing with these comments?

PAUL GIGOT: Well, I think that he was sending a message not just to the White House but to voters out there that there's a bit of a divergence here, if you look into the second term, between the President's political interests and perhaps Senate Democrats, who have to face the voters, after all, in two years in 1998, saying that if the President wants to do some deals with the Republicans, he may not have it as easy getting the votes of the Democrats because right now you have 55 Senate Republicans. With potential Democrat retirements in 1998, you could be facing a possibility of losing even more seats. And Tom Daschle knows, he wants to give his men and women some issues, and that may mean once in a while disagreeing with the President.

ELIZABETH FARNSWORTH: Do you agree with that? Is that how you interpreted the remarks?

MARK SHIELDS: Yeah. I think Tom Daschle has been now the Democratic leader. I think he's feeling comfortable and confident, and he has--I think Paul is absolutely right--there's a different agenda. His people have to be up in '98 and 2000. Bill Clinton is never again on the ballot, but I think--I'd add to that, what he doesn't want to have happen, Daschle, has happened to Democrats, has happened to the Republicans under Ronald Reagan. When Republicans in Congress were just marginalized and both Reagan-- both President Reagan and President Bush made all their overtures to the Democratic leadership to get anything done, and just assume that the Republicans would line up loyally behind the Republican- -he was saying hey, we're here, we're players, don't take us for granted, and I think the message was delivered.

PAUL GIGOT: Elizabeth, can I add one point?

ELIZABETH FARNSWORTH: Sure.

PAUL GIGOT: I think one thing that Tom Daschle said was very, very significant, was he said he basically endorsed the idea by Bob Kerrey, Senate Democrat of Nebraska, and some Republicans, that you could take a portion of your payroll tax that we now pay for Social Security and begin to maybe invest it in the stock market on your own, outside the Social Security system. I think this is really big stuff, to have a Democrat like this, and Democrats are responsible for creating Social Security say that maybe we need to begin to privatize the system, at least in part. I think this could be momentous, because if a Republican had said this, he'd probably b e dragged through the streets, it certainly would have been the last election campaign. To have a Democrat do this, I think is a signal that maybe some epic changes are possible in Social Security.

ELIZABETH FARNSWORTH: Mark, Paul, thanks for being with us. RECAP

ELIZABETH FARNSWORTH: Again, the major stories of this Thursday, the Justice Department denied the request by congressional Republicans for an independent counsel to investigate the Democrats' campaign financing. The U.N. War Crimes Tribunal in the Hague sentenced a Croat soldier to 10 years in prison for his role in the Srebrenica massacre. And on what is traditionally one of the biggest shopping days of the year, the Commerce Department reported consumer spending was up .5 percent in the month of October. We'll see you online and again here Monday evening. I'm Elizabeth Farnsworth. Thank you and good night.