The MacNeil/Lehrer NewsHour

MR. MacNeil: Good evening. Leading the news this Monday, the Soviet parliament voted to switch from a Communist economy to a free market system. South African President DeKlerk met with President Bush at the White House. Oil prices hit a 10 year high and stocks plummeted. We'll have details in our News Summary in a moment. Roger Mudd is in Washington tonight. Roger.

MR. MUDD: On the Newshour tonight [NEWS MAKER - SOUTH AFRICA] South African President DeKlerk fresh from his meeting with President Bush talks with Jim Lehrer. Then can the Soviet Union [FOCUS - DAS KAPITALISM] make it as a capitalist society, and finally part two in the "Fighting Cancer" series [SERIES - FIGHTING CANCER]. Tonight the cutting edge of cancer research.NEWS SUMMARY

MR. MacNeil: The Soviet parliament today voted to break with 70 years of centralized Communist control of its economy for a capitalist free market system. The parliament was not able to decide exactly how to make the change or how quickly to make it, but it established a special committee to resolve those issues by next month. The parliament also voted to give President Gorbachev new emergency powers. He will now be able to make economic reforms without the parliament's prior approval. Gorbachev has come out in partial favor of a plan that would make the Soviet Union a free market system within 500 days. One member of parliament complained the new powers would make Gorbachev a monarch, but Gorbachev promised to carry them out with due responsibility. We'll have more on this story later in the program. Roger.

MR. MUDD: President Bush welcomed South African President F.W. DeKlerk to the White House today. Jan Christian Smutz, the last South African head of government to visit the United States, came in 1946, but that was two years before the rigid laws of racial segregation, apartheid, were enacted. Today's Bush-DeKlerk meeting lasted more than two hours. Afterwards, both leaders spoke of irreversible change in South Africa.

PRES. BUSH: Now who among us only a year ago would have anticipated these remarkable developments? Clearly, the time has come to encourage and assist the emerging new South Africa. The United States clearly endorses the principle of constitutional democratic government in South Africa, and I'm here to tell you that I have enormous respect for what President DeKlerk and Nelson Mandela are trying to achieve together in pursuit of this principle. And it is not simply this President. I believe, sir, that it's the entire American people that feel this way.

F.W. DE KLERK, President, South Africa: Mr. President, I want to thank you for the acknowledgement of the new reality which exists in South Africa. There is, indeed, have you stated, sir, a new reality. And the process in South Africa is, indeed, an irreversible one. There will be negotiations and from those negotiations there will come about a new constitutional situation, a new constitution, which will offer full political rights within the framework of internationally acceptable definitions of what democracy really is. We stand on the threshold of a tremendously exciting period in the history of our country. We are adamant to use the window of opportunity which history has given us to assure that we will bring about a new and just South Africa.

MR. MUDD: Outside the White House, about 200 demonstrators protested the DeKlerk visit today. It had been organized by the U.S.-basedanti-apartheid organization Trans-Africa. Also the congressional black caucus cancelled a meeting it had scheduled with DeKlerk. Caucus Chairman Ron Delhams, the Democratic representative from California, said the caucus did not want to give the impression that DeKlerk had won the support of American blacks. Meanwhile, in South Africa, Winnie Mandela was arraigned today on charges of kidnapping and assault. She was accompanied to the courthouse by her husband, Nelson Mandela, a leader of the African National Congress. The charges stem from a 1988 incident in which four youths were allegedly kidnapped by her body guards, taken to her house and beaten. One of the four was killed. Mrs. Mandela has denied any wrongdoing. She and seven associates will stand trial in February.

MR. MacNeil: The price of oil reached a 10 year high today as a result of the Persian Gulf crisis. In London, North Sea crude traded at $40 a barrel, a rise of more than $3. That news helped trigger a sell-off on Wall Street. The Dow Jones Average ended the day with a loss of almost 60 points. The Persian Gulf was at the top of the agenda at the United Nations today where the General Assembly began its 45th year. The Iraqi delegation was there, but without its foreign minister, Tariq Aziz. Aziz said he won't come because the U.S. will not allow any Iraqi Airways planes to land unless U.S. hostages were freed. The U.S. would only allow him to come on another country's commercial airliner. Among today's speakers at the General Assembly was French President Mitterrand, who again condemned Saddam Hussein's takeover of Kuwait.

FRANCOIS MITTERRAND, President, France: [Speaking through Interpreter] Kuwait is a sovereign state, a member of the international community. In the name of what can one decide that this state has ceased to exist? In the name of the law of planes, tanks, and trucks? So we are prepared to pick up any chance for peace and we are seeking this because our logic is one of peace against illogical war which has imposed upon a terrified world by Iraqi policy. Not one gesture, not one word, in fact, thus far from the President of Iraq has given us even a glimmer, a hope for conciliation. He disregards and rejects the supreme party views.

MR. MacNeil: Saddam Hussein today repeated his refusal to give up Kuwait. He said his people would fight for a thousand years to keep it. Yesterday he threatened to attack Saudi oil fields and Israel if the embargo chokes his country. White House Spokesman Marlin Fitzwater dismissed that threat is another one of Saddam's daily diatribes, but Israel said today it is taking the threat seriously. Foreign Minister David Levy said Israel has proved in the past that it can defend itself and will act appropriately if attacked.

MR. MUDD: The International Monetary Fund today said it would speed up loans to those poor countries which support the embargo against Iraq. That could amount to billions of dollars to such countries as Egypt, Jordan, and Turkey. Iran said today it has arrested 29 people for trying to smuggle food to Iraq. The government of Iran had already said it supports the embargo, but there were recent reports that Iran was considering sending Iraq food in exchange for oil.

MR. MacNeil: About 150 people demonstrated outside a Cincinnati courthouse today as jury selection began in the trial of the Cincinnati Contemporary Arts Center and its director, Dennis Barry. They are charged with obscenity violations for showing an exhibit of pictures by the late photographer, Robert Mapelthorpe. Last spring's exhibit attracted more than 80,000 people to the gallery, but a Grand Jury concluded that seven of the one hundred seventy- five photos showing homosexual acts and semi-nude children were in violation of obscenity laws.

MR. MUDD: That's our summary of the day's news. Just ahead a News Maker interview with South African President DeKlerk, the Soviet Union's economic struggle towards capitalism, and another in our continuing reports on the battle against cancer. NEWS MAKER - SOUTH AFRICA

MR. MacNeil: First tonight we have a Newsmaker interview with South African President F.W. DeKlerk. He met with President Bush earlier in the day and he is now at the National Press Club in Washington with Jim Lehrer. Jim.

MR. LEHRER: Mr. President welcome.

F.W. DE KLERK, President, South Africa: Good evening. Thank you very much.

MR. LEHRER: How does it feel to be the first President of South Africa since 1945 to visit a President of the United States?

PRESIDENT DE KLERK: For South Africa it is an important occasion, historical event and I am very glad that it materialized?

MR. LEHRER: Do you feel that your country deserves this state of isolation that it has been held in by the United States and the rest of the World all these years?

PRESIDENT DE KLERK: No I basically think the best way to influence people is to have contact with them and through dialogue and interaction one can bring about much more than through isolation. So basically I am not an isolationist also not against those with whom I do not disagree.

MR. LEHRER: Do you understand why your country has been treated the way that it has been?

PRESIDENT DE KLERK: This I can't place myself in the place of others and I have some understanding but I think that if another route has been taken would have been more constructive and therefore I sincerely believe that constructive involvement and interaction is the best way to steer the course of events if one is not happy with the way things are going.

MR. LEHRER: Did you have any special message for President Bush today?

PRESIDENT DE KLERK: I wouldn't say a special message. I used the opportunity to fully inform him first hand of what is happening in South Africa. The basic message that I came with to America is that we want to normalize our international relationships are we are normalizing internally the relationships between all the people of South Africa. As we normalize the political process. South Africa firstly wants to solve its problems. Wants to find a peaceful solution which will offer full opportunity, equal opportunity, equal hope, equal involvement and participation to all South Africans. Simultaneously we want to take a proud place in the international community. We have much to contribute. We the biggest regional power in Southern Africa. We are one of the most important places in the Southern hemisphere. South Africa can become the spring board of development that is so necessary. Economic resuscitation of Southern Africa. We have a contribution to make. We can not do that if we are not fully a part of the international community. We have a vision of Southern Africa as a region that is almost 100 million people developing in to an important economic region for the whole world. And our neighboring states are looking at us. They want us to succeed. They are looking to us with hope realizing that our infra structure will have to be the springboard from which their fight against poverty and decline in the economy must be launched.

MR. LEHRER: And yet apartheid yet exists. Did President Bush not say to you the role that you wish to take in international community isn't going to be there as long as apartheid exists?

PRESIDENT DE KLERK: I think there is general acceptance that apartheid is really going. If I were to give a list of what used to be apartheid legislation then you would realize that in essence we are dealing with few remaining acts, yes, which discriminate and which will go. I have already announced that the most important of those acts on our statute book will be repealed early in the next parliamentary session which starts at the beginning of 1991. I think there is a general acceptance that we have reached the point of no return. The process of voting a new and just South Africa is irreversible. President Bush acknowledge this after our talk. This is important for us because we also say that it is irreversible. There will be a new South Africa.

MR. LEHRER: What is your vision, your own personal vision of what this new South Africa is going to be like for the average black person in South Africa?

PRESIDENT DE KLERK: It must offer full political participation to all South Africans, also black South Africans which means a vote of equal value. Which means participating in Government in all levels. Which means economic opportunity. Which means a system which is fully democratic in the internationally acceptable sense of the world which is just and equitable. I also believe that it must contain protection for minorities against the abuse or misuse of a majority of its power. That there must be built in to such a system checks and balances. We believe that there must be a bill of rights which properly also protects individual rights. We've already drawn a draft one. The South African Law Commission did that. It was published for comment. They are now working on their final report. I would say the foundation of this new South Africa must be justice and there must be four pillars on which it rests. One is participation which I have already mentioned. The other is progress in education and all spheres. The other is prosperity we need a vibrant economy and that we can only have based on the free market system, free market principals protection of property rights. And then there must be peace. Peace in the sense of stability. You can't reform, you can't change fundamentally under unstable conditions.

MR. LEHRER: Are you saying then that you are willing to accept one man one vote which is the form of democracy which we have in the United States and other countries have? Is that what you are saying?

PRESIDENT DE KLERK: Yes but also build into such a system effective protection of minorities against the abuse of power. You have it in a specific manor. As I understand your system a minority elects the majority of the Senate. In Switzerland they accommodate the needs of the minority population in a different manor. In Belgium they do it in a different manor. And all three of the countries that I have mentioned have good sound acceptable democracies. We need to develop a democratic constitutional system which will accommodate the realities and the needs arising from those realities of our country which differ somewhat. Which is even more complex than any of the examples that I have mentioned.

MR. LEHRER: When you look ahead to the future to a new South Africa do you see a black majority run government with the whites in the minority protected by a constitutional bill of rights like we have in the United States today?

PRESIDENT DE KLERK: I don't see any form of racial discrimination built in to the new constitution. We say we are dedicated to move totally away from racial discrimination in any form whatsoever. I sincerely believe that people who believe in the same things will in that new South Africa stat cooperating. Start on the basis of shared principles and shared believes. Cooperating in their own political movements but yes with the population with population with such a big portion of the population is black surely there will be a presentation in large numbers. No doubt of black faces in Parliament and governmental positions. What we are saying is that it must not be a majority domination model where the majority, how ever, it is complied through sheer numbers suppress or act to the detriment of the many minorities. South Africa is not just a black and white country. Between black and black there are fundamental differences as has been so painfully shown and proven by what has happened in our country in the past number of weeks. Therefore there are black minorities which also don't want to be suppressed, which are also anxious to assure their conditions, their language, their particular culture will have room to continue to exist, to continue to develop. We must accommodate therefore our diversity in a non discriminatory and a non racialistic manor.

MR. LEHRER: And that means one man one vote majority black rule down the road?

PRESIDENT DE KLERK: That means a vote of equal value, one man one vote which is what a vote of equal value means but a system with checks and balances to insure that a majority will not use its power or will not be able to misuse its power to the detriment, to the suppression of others.

MR. LEHRER: You mentioned the violence that is now going on between blacks in your country. Nelson Mandela has said that the Government is really to blame for that on two counts. That there are members of the security forces who are the hidden hand behind it and that the Government is acting slowly and could stop it if they wanted to. Do you agree with him?

PRESIDENT DE KLERK: Well I must point out and I do so without any aggression or contradiction in the two statements. There was the statement that we are not doing enough. When we tightened up took additional powers, announced additional strong steps to curb the violence the accusation came that we are doing to much. But leave that aside. I don't agree with the statement. The police forces, security forces are acting basically impartially. That is the instruction. They are there to protect the lives and properties of the people of South Africa. It is possible that an individual in the forces might not adhere to those orders and to such regulations and if he or she will transgress we will take steps against them. On the presentation of any evidence of misuse of power by the security forces we will follow it up. It is not what we want and there is no basis for the allegation and I noticed that Mr. Mandella also refrained from making that accusation that the Government is using the security forces for its political ends and is choosing sides as a government through its forces.

MR. LEHRER: Do you believe there is a hidden hand behind all of this. That some right wing whites are egging the blacks on both sides on to kill each other and cause this instability?

PRESIDENT DE KLERK: There is no definite evidence of that but there is a new dimension where as we have had over a period the unfortunate faction fighting. Supports of one political movement becoming involved with clashes of another political movement. The new dimension was that small bands of people. I prefer to call them terrorists no matter what their color might be are shooting innocent bystanders at random, at the street corner or a train. That is a new dimension. We want to find out who those people are and the full talent of the police force is deployed to find the perpetrators of these dastardly deeds and if we find them we will know who they are. It might be a small group of people from with in the ANC, it might be from the far right. We need evidence and we are looking for that evidence. We want to stamp this out.

MR. LEHRER: Why would Mr.Mandella make the charge that the government could stop this if they wanted to and then suggest that if you do not stop it that he is personally going to break off the talks that the ANC is having with the government toward a new government?

PRESIDENT DE KLERK: Well firstly I have constantly refrained from explaining Mr. Mandella. I think that he is a free person now and he can explain himself. I wouldn't like to be his advocate in explaining exactly what he means. I must say that I have just today seen going on television where he very clearly stated and restated his full commitment to the negotiation process. The threat while was in South Africa and since my arrival here was not a very direct threat. He advocates that not withstanding his criticism which he is free to deliver he continues to believe and I share that fully with him in negotiation as the real road to peaceful solution.

MR. LEHRER: You all supposedly have developed a real relationship. Why don't the two of you sit down and talk about this if it is such a serious matter. Have you talked about this matter of violence?

PRESIDENT DE KLERK: Yes we have open discussions on it. In the two weeks before I came here I think that I saw him more than once and I spoke more than once with him on the telephone. I saw him shortly before I left for America. There is an open channel of communication. He regularly speaks to some of my ministers. He has his criticism and we disagree on a few points. We disagree on policy points. I think that much of his criticism with the regard to the handling of the security situation is unfounded and I tell him that. Our relationship is such that we have not allowed differences of opinion to become stumbling block that we two and others leaders, there are also other important leaders in South Africa, should continue talking and find ways to overcome that difference.

MR. LEHRER: Mr. De Klerk you have often been compared with Gorbachev, that you are the Gorbachev of South Africa. Does that add up to you? Does that comparison make sense to you?

PRESIDENT DE KLERK: Well I think the comparison starts because we have the same hair style. I think the comparison is a bit far fetched. Yes I can see a comparison in the sense that both of us as leaders have embarked on the road of fundamental change but the type of change that he has to effect is totally different from the type of change that I have to effect. I am governing a country with a free enterprise economic system with everything in place if restrictions are removed for a blooming economy, a vibrant economy. He faces a tremendous challenge in changing the basic culture in regard to the economy. So I could continue to highlight differences. But there is in that one respect I think a fundamental comparison to be drawn.

MR. LEHRER: Did you wake up one day just out of the blue and say my goodness apartheid must go and I must do everything I can to get rid of it or did you feel that it was either get rid of apartheid or preside over a bloody civil war?

PRESIDENT DE KLERK: I did not have a Damascus experience in suddenly waking up, suddenly seeing the truth. I am the leader of a political movement, the National Party, that party has over a number of years gone through a period of deep self analysis. Realizing that the grand concept which we have of giving political rights on the basis of nation states, creating full political justice for everybody on the basis of making a little Europe out of South Africa would not just work. When we realized that we then went to the drawing board and made the fundamental decision to change our policy to one of full power sharing in one South Africa. We did that democratically. We went to our own power base our own constitution, fought an election in 1987, won a mandate and since then the policy has been one of power sharing. It took us a year or two to get through the old prejudices and the old beliefs and to convince the World that we mean what we say. And I am so glad that I can now experience that the World is starting to believe us.

MR. LEHRER: Mr. President thank you very much.

PRESIDENT DE KLERK: Thank you very much.

MR. MUDD: Still ahead on the Newshour capitalism comes to the Soviet Union and the cutting edge of cancer research. FOCUS - DAS KAPITALISM

MR. MacNeil: Next tonight we focus on the Kremlin's latest move towards ending 70 years of Communist economics and introducing a free market. Today the Soviet parliament voted almost unanimously to convert the country's shattered economy into a market system. It also voted to give Soviet President Mikhail Gorbachev special powers to help implement the switch. Tim Uert of Independent Television News has this report from Moscow.

MR. UERT: Familiar scenes in Moscow this morning, empty shelves in the shops, confusion in the corridors of power. The Supreme Soviet agreed there should be transition to a market economy but couldn't decide on the details. They voted overwhelmingly to put the ball in Mikhail Gorbachev's court, effectively asking him to come up with a single plan for them to approve. Prime Minister Nikolai Rishkov has again been championing his moderate reform plan, warning on state TV, the country's not ready for a sharp swerve. And Economist Stanislaus Shatalin has again been fighting for his radical 500 day program. "There can be no compromise," he said. Meanwhile, things get steadily worse for the public, the latest scare a massive winter shortage of potatoes, the most basic of Soviet food stuffs. Shoppers are as bewildered about the market economy as the politicians. "The people don't know what it means," said this man, "There are no explanations."

FYODOR BURLATSKY, Member of Supreme Soviet: Maybe 80 percent of our population don't understand this. They understand very simple things.

MR. UERT: What it will mean is higher prices, no shortages in Moscow's private central market today, but a chicken here now costs the equivalent of three and a half days wages for the average Soviet worker. Mr. Gorbachev wants emergency powers to steer through economic reform. Many in the Supreme Soviet agree that strong leadership is the only way to solve their own indecision.

MR. MacNeil: Now with some analysis of these historic decisions are Vladimir Kontorovich, a professor of Soviet economics at Haverford College in Pennsylvania, he's also the author of the soon to be published book, "The Disintegration of the Soviet Economic System". Jeffrey Sachs is a professor of international economics at Harvard University. He's an economic adviser to several Soviet Bloc countries. Last week he returned from talks in Moscow with several high level Soviet officials. Mr. Kontorovich, how significant is today's decision, or are today's decisions?

VLADIMIR KONTOROVICH, Economist: Today's decisions are just another step in the process that has been going on for several years in which Gorbachev is accumulating more and more formal power, more and more power on paper, whereas his real power declines. I don't think that his real power will be increased by this act of the Supreme Soviet.

MR. MacNeil: But apart from Gorbachev's power, what about formally taking legislative action to go towards a market system, is that not a significant development today?

MR. KONTOROVICH: It is a significant development in that the country is committed to a certain course. It is less of a significant development in the sense of achieving this goal. The reason for that is that for any program to be carried out there has to be political authority that is obeyed. The problem with all economic programs in the Soviet Union today is absence of a government that will be obeyed.

MR. MacNeil: Do you agree with that, Jeffrey Sachs, that the absence of real authority and how to carry something like this out really undermines the historic significance of this decision today?

JEFFREY SACHS, Economist: I think that this is a historic break of enormous momentous importance. The Soviet leadership, Communist officials, and former Communist officials of the Supreme Soviet, have decisively voted for a market system. We know that the plans under consideration and particularly the plan that President Gorbachev, himself, has described himself as favoring is based on private ownership at the very core of the new system for the Soviet republics, and I believe that the shift to private ownership as a basic organized philosophy of a new economy is of decisive importance for the Soviet Union and the world. I agree that the question of implementation is a very real one, the question of political legitimacy is a very real one, but the ideological break with 70, more than 70 years of Communist style economics is of fundamental importance for the whole world.

MR. MacNeil: Describe briefly, Prof. Sachs, the significant differences between -- Prime Minister Rishkov wanted to go slowly and very moderately and essentially keep central control, and Shatalin, the Gorbachev economic adviser, had the most radical plan, which the Russian Federation under Yeltsin has already adopted, in effect. Now what does Gorbachev want and what are the significant, what is he picking from both and what are the significant differences?

MR. SACHS: There are, of course, crucial questions of tactics right now and it's an extraordinarily difficult set of choices under enormous pressures and really the risk of chaos, but what I think is significant about the Shatalin program is that it was based centrally first and foremost on privatization and private ownership, and I regard that as the core of everything, because that is the decisive break with socialism, the decisive break with the whole philosophy of the Communist era, and I think President Gorbachev is behind that fundamental break. There are questions of tactics, when to free prices, when to liberalize, when to make the ruble convertible. Those are hard choices, there are differences, but I believe that President Gorbachev is decisively behind the central issue, which is making private ownership the key motivating force of the new economy.

MR. MacNeil: It seems to us watching, and Gorbachev, himself, has been frequently criticized recently for appearing after all those years of being the world's most decisive leader, suddenly looking very indecisive and ineffectual. Do you believe that he is now moving back into his decisive role in this situation?

MR. KONTOROVICH: He has to. The economy's deteriorating fast and I think the whole logic behind 500 days program is the logic of desperation. If you read, the version of 500 days program that I've seen is Russian Republic's version, and it has passages like first hundred to two hundred days we'll privatize the economy. Soviets economists understand that you can't really privatize the economy in 200 days. There were objections to make people stockholders by force, by command. You don't announce market economy come January 1st as other Soviet economies have been conducted. To the contrary, private, especially private ownership has to be nurtured over many years before it takes root, especially in a country like Soviet Union. Announcing a 500 days program I think is a gesture of desperation in the Senate. You have to promise something fast. You won't be believed if you will ask to wait for a little bit for some more sacrifices and so on.

MR. MacNeil: Is that what it is, Mr. Sachs, an act of desperation because you won't be believed if you preach gradualism?

MR. SACHS: Well, it certainly is an act in a desperate situation, but the authors understand full well that the way out of the desperate situation is to move dramatically and comprehensively. They are watching the experience now in Poland, in Czechoslovakia, in Hungary, of getting out of this mess, and what they have taken from that experience is that it is possible to meet comprehensively to liberalize the economy, to privatize the economy, and that it must be done very fast. One of the reasons it must be done fast is that the situation truly is a desperate situation. I don't know, and I agree with Kontorovich that 500 days is too optimistic in many ways. Maybe it will be 5,000 days, but what's important about that program is that it is a coherent and comprehensive approach to a full transformation of the economy. It is very level headed. It takes the experience of Eastern Europe now, and I think that this is an enormously significant development and we must appreciate in the West that there is a fundamental, ideological shift, a rejection of the past, and a desperate attempt, yes, a desperate attempt to move to what is regarded now as the only workable hope, and that is to approach a Western style market economy based on private ownership. There is another important part of the program, if I may stress it, and that is that it recognizes that there will be an inevitable evolution of power to the republics in the newly constituted Soviet economy, so it aims to give much more sovereignty back to the republics where there is the possibility of more political legitimacy and where one has to meet the very real political pressures now.

MR. MacNeil: But that's the Shatalin plan. Isn't Gorbachev, himself, opposing giving all that economic autonomy to the republics?

MR. KONTOROVICH: Gorbachev was, but the matter is that republics are now taking these matters in their hands by themselves, so the position of Gorbachev will be probably as it as previously, when overwhelmed by event to go with the events, and I think the whole matter, the country is disintegrating and it's very difficult to have any economic policy succeed in such a situation. There are things larger than the economy.

MR. MacNeil: Describe, Mr. Sachs, how they begin with this. If this plan is adopted or something like it by October 15th, the new deadline they've given themselves, how do they actually begin? I mean, the state at the moment owns everything and runs everything. How do they begin?

MR. SACHS: The first step is to solve a very deep and profound fiscal and monetary crisis. They're printing rubles like crazy now and the rubles buy nothing. And one has to take various monetary and fiscal belt tightening measures to make the money meaningful again. That's exactly what was done in Poland and Yugoslavia this year and it succeeded in making those moneys stable and even convertible in those countries. So I think that there are prospects under this plan for stabilizing the monetary situation. The next step is to free up markets and to privatize small business, trucks, small shops and so forth, and to allow private economic activity. The third and hardest step, of course, is to transform the large enterprises into share companies with the shares owned again by private citizens rather than by the state. There's a logical sequence in the plan, but of course there are enormous political and economic obstacles in the path. I think that we shouldn't get tied down in the day to day specifics of the plan but keep the central attention that the Soviet Union wants to transform itself into a normal, privately owned market economy, and that the West has a vital stake in helping to see that through.

MR. MacNeil: Right. Well, Mr. Kontorovich and Mr. Sachs, thank you both for joining us. SERIES - FIGHTING CANCER

MR. MUDD: Next, we continue our six part series on cancer. Tonight we examine the cutting edge of cancer research. Recently, Correspondent Elizabeth Brackett visited three leading research laboratories where scientists are grappling with what many regard as the ultimate challenge, figuring out how a single cancer cell grows and then spreads.

MS. BRACKETT: January 1, 1990, was a special day for high school sophomore Kurt Weiss. He was realizing a life long dream to play with the Notre Dame Band at the Orange Bowl, a dream made possible by the Make A Wish Foundation, the organization that helps children with cancer. Kurt is a victim of bone cancer in his leg. Just last January, it looked like he had beaten the disease.

KURT WEISS: From the beginning, I had very good success with chemotherapy. I had a 75 percent kill on the large tumor in my leg, and when they went in to take out the three nodules in my chest, there were 100 percent killed on them which was very good.

MS. BRACKETT: But it turned out it wasn't good enough. A few months ago, the disease reappeared in his lung. It had spread there from his leg tumor. For Dr. Eugenie Kleinerman, Kurt's doctor at M.D. Anderson in Houston, watching the disease progress without having the tools to fight it is frustrating.

DR. EUGENIE KLEINERMAN, M.D. Anderson Cancer Center: Solid tumors by and large are not sensitive to chemotherapy. I think that's where we have failed. I think chemotherapy is a beginning, but I think we need new forms of therapy, new ideas, different approaches, if we are going to be able to conquer this disease.

MS. BRACKETT: Kurt Weiss and the 1 million other Americans who get cancer every year are in need of new ideas, new ideas that work. Over the years, the press has trumpeted many supposed cures. The magic bullet was thought to be Interferon, Interluken II, monoclonal antibodies to name a few, but results never matched the hopes.

PRES. NIXON: [May, 1971] Now there have been some very significant breakthroughs, breakthroughs that indicate that we can really look forward to the daythat we can find a cure for cancer.

MS. BRACKETT: Almost 20 years after President Nixon declared a war on cancer, some wonder if this war will be our medical Vietnam. Every year, more Americans get cancer and more die from the disease. This year, cancer will kill 1/2 million Americans. Cancer patients and those treating them on a daily basis often feel they're losing the battle against cancer, but doctors and scientists in the nation's research labs say they are making important progress toward understanding cancer. No one is promising a single cure, but the cutting edge of research is now being directed toward the basic questions of how cancer begins and why it spreads.

DR. BERT VOGELSTEIN, Johns Hopkins University: The whole history of medical research inevitably leads to the conclusion that the war can be won. Perhaps people got their hopes up that the war would be won much quicker than it really could be. From my perspective, one of the first battles is being won. That's the battle for understanding how the disease comes about.

MS. BRACKETT: Dr. Bert Vogelstein is on the forefront of understanding how cancer begins. He has discovered what researchers long suspected but could not identify, that mutated genes cause cancer. His work at Johns Hopkins University has been done with colon cancer, one of the deadliest cancers.

DR. VOGELSTEIN: In colon, it appears that a series of several mutations have to occur before a normal cell can become a malignant cell. If one or a few of these genes mutate in succession, then a small, benign tumor will form. But if that tumor is left within the body, as it usually is, eventually additional mutations will occur and the tumor will progress to a malignant form, which can be very dangerous to the patient. [SCENE FROM "WAR GAMES"]

MS. BRACKETT: Gene mutation is often a random process. That sort of process was dramatically depicted in the movie "War Games". Here a computer searches randomly for the necessary launch codes for a nuclear attack. As it finds each number, it locks them in. [SCENE FROM "WAR GAMES"]

MS. BRACKETT: In short order, it gets the right combination to launch the missiles. The process that leads to cancer is similar. Dr. Vogelstein and his team are studying colon cancer genes to look for random mutations, mutations which can result in the deadly combination which causes colon cancer. Here's a side by side comparison of a normal colon gene, while the one on the right has mutated. In all, Dr. Vogelstein found that it takes at least five different colon genes to mutate to start colon cancer.

DR. VOGELSTEIN: Most cancers are thought to go through similar stages as the colon. In most common adult cancers, it appears that it requires a stepwise mutation sequence in several genes before final cancer forms.

MS. BRACKETT: These random mutations are caused either by a mistake during the division of a colon cell or by carcinogens, chemicals which we eat or breathe which damage genes. And even after the cancer forms, the mutation process doesn't stop. The genes continue to mutate and eventually the cancer spreads or metastasizes throughout the body.

DR. VOGELSTEIN: The metastisitic process is one of the most important, because that's the process that kills patients. And it's fairly clear that the more mutations a patient's tumor has, the more likely it will metastasize and be lethal.

MS. BRACKETT: It is the metastisism of bone cancer to his lungs that Kurt Weiss is now fighting. He knows the odds are against him.

KURT WEISS: The main problem with cancer is that it has let go for so long that the more you let it go, the cancer progresses.

MS. BRACKETT: It is the way cancer progresses or metastasizes that has become one of the key research battlefronts. A leading researcher in this field is Dr. Judah Folkman at Children's Hospital in Boston. Why has it taken so long for people to begin seriously begin studying what happens when cancer metastasizes?

DR. JUDAH FOLKMAN, Children's Hospital, Boston: Well, people have known about the process for a long time, just like people have known about, for example, jaundice. You can see it in patients, but understanding how it works, how metastasizes works, has been hard.

MS. BRACKETT: Folkman's contribution has been to identify the step called angio-genesis.

DR. FOLKMAN: It means a birth of new blood vessels. It usually refers to small blood vessels that are thinner than a hair. And we're studying them because in tumors they grow very, very rapidly at a certain phase of tumor growth and they are used by the tumor for not only further growth of the tumor but for its spreading, for its metastasis. When blood vessels start to connect up to a new tiny, small tumor, as many as 50,000 cells a day can leave the tumor and pump themselves into the bloodstream.

MS. BRACKETT: As these cancer cells are pumped into the bloodstream, many are killed by the turbulence of the circulation system, others by the body's immune system, but a few survive and are able to move through the blood vessels and drill their way out and feed and grow in other organs. Dr. Folkman's 30 years of research has led to the recent development of a drug which he hopes will interrupt this deadly process.

DR. FOLKMAN: One of the drugs we're working on stops the blood vessels from growing in, so the tumor is sitting there, but since it can't connect up to blood vessels, it's very hard for it to send cells out into the bloodstream. It's the same as if you build a house and you want to hook up to the sewage system or to the water system, if you have no pipes, there's nothing you can do to get into the main system.

MS. BRACKETT: The drug's effectiveness can be seen in these mice. This mouse has been receiving injections of the drug. This mouse has not.

DR. FOLKMAN: So it's very exciting in mice. You can hold the tumors and the mice run around for half their lifetime, but you have to stay on the drug. So that may not be a wy to cure the tumor, but it might be a way to hold it from being lethal.

MS. BRACKETT: Folkman says it will be at least two years before his drug can be tested in humans and five years before it would be available for patients. That may be too long for Kurt Weiss, however, he is part of a highly experimental drug therapy program at M.D. Anderson in Houston. Doctors here are also working on a drug they hope will stop cancer from metastasizing throughout the body. The effort is being led by Dr. Isaiah Fidler. He knows he is up against a tough adversary.

DR. ISAIAH FIDLER, M.D. Anderson Cancer Center: We have recently shown that one single cell can give rise to a metastasis. So for curing cancer, it's not enough to kill 99.99 percent. You have to kill every single cancer cell.

MS. BRACKETT: Dr. Fidler's drug uses the body's own immune system to destroy those cancer cells. He has discovered that there are cells in the immune system that will seek out and destroy cancer cells while leaving normal cells alone.

DR. FIDLER: That high degree of selectivity is very attractive, because a major problem in cancer treatment is the lack of selectivity of anti-cancer drugs. It'll kill normal tissue as well as tumor cells.

MS. BRACKETT: The cell in the immune system that Dr. Fidler is using is called a macrophage. But macrophages won't attack cancer cells unless they have been given a signal by the body. Dr. Fidler and his research team spent years developing a synthetic compound that when injected into a patient is able to give that signal to the macrophages.

DR. FIDLER: You can then activate the macrophages to become killer cells for tumor cells. They then seek out the metastasis, they migrate to the zone of the metastasis, and they destroy the tumor cell, while they leave the normal cell unharmed.

KURT WEISS: I had always thought that this would be the best route to take, and my parents were a little wary about it, but they said they would back me up whatever I wanted to do. All my friends said that I should go after this also because they said, sounds like a great idea and if it works, it would be great. [Buzzer Going Off on Equipment] That means I'm done.

MS. BRACKETT: While more benign than chemo, the therapy does have side effects. Kurt and other patients often experience chills, headaches, and fever as a result of the treatment. But Kurt looked beyond his own pain when he agreed to be a part of the experimental trial.

KURT WEISS: If this works, the end result would I'm sure save many, many lives, which is one of the reasons why I came down here, because I've always thought no matter what happened, what would happen with me, that somebody has to learn something, and if nobody learns anything from me, then it's been all for naught, that I have to at least in some ways try to help the plight of everybody who has cancer.

MS. BRACKETT: Kurt did not immediately respond to the therapy, so his dosage was increased and the macrophages began attacking his cancer. Now he's home in Pittsburgh, receiving his treatments. So far, his lungs are clear of metastasis, but Dr. Kleinerman admits this therapy is not the magic bullet so desperately sought by patients either. She says there are not enough macrophages in the body to attack and destroy very large tumors. Like other therapies which rely on the body's immune system, macrophage therapy will probably prove most effective when used in combination with traditional therapies.

DR. KLEINERMAN: The chemotherapy can get rid of 98 percent, 99 percent of the tumor, and then our immune system can come in and clean up the remaining 1 percent or 1/2 percent or 1/10 percent of the cells that aren't eliminated by the chemotherapy.

MS. BRACKETT: Whether or not the new knowledge of how cancer starts and then spreads leads to the cure everyone hopes for remains to be seen. What is clear is that no one is even close to declaring victory in the war on cancer yet.

MR. MUDD: Each night this week the Newshour will be reporting on the war on cancer. Tomorrow evening we'll examine whether psychological support groups have a positive effect on cancer patients and on their survival rates. RECAP

MR. MacNeil: Once again, recapping Monday's major stories, the Soviet parliament agreed to change the nation's centrally controlled Communist economy to a free market system. Soviet President Gorbachev has granted broad emergency powers to implement the reforms. Renewed fears about a military confrontation with Iraq sent oil prices to a 10 year high and stocks sharply lower. South African President F.W. DeKlerk met with President Bush at the White House. On the Newshour this evening, President DeKlerk reaffirmed his commitment to a one man, one vote political system with safeguards to protect the rights of minorities. Good night, Roger.

MR. MUDD: Good night, Robin. That's the Newshour for Monday. I'm Roger Mudd in Washington. Good night.