The MacNeil/Lehrer NewsHour

Intro

ROBERT MacNEIL: Good evening. In the headlines today, South African police broke up protest demonstrations as the country's financial crisis deepened. President Reagan rejected restrictions on imported shoes. U.S. airlines will be ordered to check a widely used jet engine because of last week's British air crash. We'll have details of these and today's other major stories in a moment. Jim Lehrer is away tonight; Judy Woodruff is in Washington. Judy?

JUDY WOODRUFF: We have a newsmaker interview and two focus reports on the NewsHour tonight. First, the President's decision not to provide relief to America's shoe industry. Mr. Reagan's top trade negotiator joins us. Next, a look at what South Africa's worsening troubles mean for her economy. And, finally, 20 years after the U.S. Army's First Cavalry Division went into Vietnam, Stanley Karnow shows us how the Cavalry's changed. News Summary

MacNEIL: There were many developments in the South African story today. At least three black men were killed and many injured when troops and police charged demonstrators demanding freedom for Nelson Mandela. Foreign banks were reported demanding repayment of loans totalling more than South Africa's reserves. President Botha last night banned all gold, currency and stock trading until Monday. The country's largest black miners union said it would strike seven gold and coal mines on Sunday. We have a report from South Africa by James Robbins of the BBC.

JAMES ROBBINS [voice-over]: By mid-morning crowds were gathering outside the stadium where the march on Pollsmoor Prison had been planned to start. Security forces strengthened by reinforcements flowed into Cape Town closed off any areas where protestors might gather. Several thousand people tried to move out of townships to join the march, but the police response to any formation of a crowd was quick. The idea of a mass march seemed increasingly unlikely as a line of police wielding shamboks faced groups, here mainly Moslem, defying the law by congregating and singing. The police commander's response: the order "Go in and clean up." Time after time the police charged first one way, then another. Among the arrests, the former head of the Methodist Church in South Africa and several university lecturers. The most serious confrontations were in the black township of Guvulethu.(?) Trouble has been breaking out here sporadically for weeks, and surfaced again today on a wider scale. Fires were started in several areas with reports of petrol bombs being thrown.

The only march that was allowed to proceed more than a few steps towards Pollsmoor Prison was on the move far away from the townships, staged by predominantly white students from the University of Cape Town. Today they escaped a beating from the police with an agreement to stop at a police line, but the university has become another institution increasingly committed to opposition. Elsewhere, the security forces have been stretched to contain crowds in several different areas of the city. They have been using the stern measures promised by the government, facing large sections of the community apparently more unsettled than ever before.

MacNEIL: In Washington the State Department made one of its strongest condemnations of South African government actions to date. Spokesman Charles Redman criticized police tactics in breaking up today's demonstration and the new ban outlawing the Congress of South African Students.

CHARLES REDMAN, State Department spokesman: Banning individuals and organizations from political activity is one of the most odious practices of the South African government. It offends the democratic values of free speech and assembly, and accentuates the anger and frustration felt by all the opponents of apartheid. The South African government's contention that it upholds Western values is belied by such actions. A society can never effectively come to terms with its problems by repressing dissent. We call on the South African government to honor its commitment to democratic values and to show respect for those who have legitimate grievances against the system of apartheid.

WOODRUFF: President Reagan said no to America's shoe manufacturers today. Despite their loud plea that they are being devastated by foreign competition, the President refused to impose quotas or raise tariffs on imported shoes. In a statement released in California where he is vacationing, Mr. Reagan said such measures would be detrimental to the national economic interest. Instead the President said he would take steps to put pressure on foreign governments to open their markets to more U.S. goods. In Washington Mr. Reagan's chief trade negotiator said this decision should send a message to U.S. trading partners.

CLAYTON YEUTTER, U.S. Trade Representative: This is not a protectionist nation, and that as far as the administration is concerned and the President of the United States is concerned, we are not going to go the protectionist route. That, even though times are tough for our import-sensitive industries, the President has a great deal of empathy for that and understanding of that situation, we know that import-sensitive industries such as the footwear are under substantial stress. But notwithstanding that, the President feels very strongly that the answer to any problems that the footwear industry has or that any other import-sensitive industry has do not lie within the concept of protectionism, that that at best provides short-term relief. In the long run it will be detrimental even to the interests of those specific industries, clearly detrimental to the interests of the United States as a whole, and very, very costly.

WOODRUFF: The administration decision was immediately attacked by representatives of the footwear industry and shoe-producing states. Several senators said they would now push for legislation to force relief for domestic shoemakers, and the head of the Footwear Industries of America called the move evidence of the bankruptcy of the President's international trade policy.

GEORGE LANGSTAFF, Footwear Industries of America: President Reagan's decision today to do nothing in the way of import relief for the beleaguered U.S. footwear industry is crystal clear evidence of the bankruptcy of his administration's international trade policy. It's a slap in the face to the U.S. Congress and American workers and domestic manufacturers. It's sad to say that today America's largest export is American jobs.

MacNEIL: The Federal Aviation Administration said today it will order U.S. airlines to check engines like that involved in the Manchester, England, airport crash which killed 54 people last week. The engine is the JT8D made by Pratt & Whitney of Hartford, Connecticut, used by about 2,000 of the 3,000 commercial jet airliners flying in the United States. It powers the Boeing 737, which crashed in Britain, as well as the 727 and the McDonnell-Douglas DC-9. British Airlines grounded five Boeing 737s today after discovering crackshecks were made. One airline official said the situation has frightened many passengers and there was an unusual number of cancellations this morning. In this country the FAA order to inspect the engines will be made in the next few days and will probably not interfere with airline schedules.

WOODRUFF: Twenty-seven people were injured and a mass evacuation was barely averted when a leak occurred at a chemical plant in Pennsylvania early this morning. The incident took place at the Sartomer Company in West Chester, some 20 miles west of Philadelphia, when some petrochemicals were being mixed, setting off a reaction that spread irritating fumes over a large area. One person was admitted to a hospital; the others were treated and released.

And the company that has been plagued recently by a series of chemical leaks announced today that it is laying off 4,000 workers and selling some of its businesses. Officials of Union Carbide said it is taking these steps and others as part of a plan to shore up shareholders' value in the corporation. Wall Street analysts interpret it as moves to avert a takeover.

MacNEIL: The government of El Salvador has arrested three men suspected of killing six Americans last June. The State Department said one of them had confessed. President Jose Napoleon Duarte said a fourth suspect was wounded in the attack and later died; seven other suspects are being hunted. All were identified as members of a small guerrilla group called the Central American Revolutionary Workers Party. The attack occurred on June 19th in San Salvador when gunmen sprayed a sidewalk cafe with automatic weapons fire, killing 13 people. The cafe was known as a haunt of American servicemen. Four of the six Americans who died were off-duty U.S. Marines; the other two were American businessmen.

West German Chancellor Helmut Kohl today fired the country's intelligence chief as Bonn's spy scandal widened further. The scandal erupted with the defection to East Germany of the head of counterespionage, Hans Joachim Tiedge. It widened today with the arrest in Britain and Switzerland of four alleged East German spies in moves West German sources said were connected with the Bonn situation. The chief of intelligence, Hedibert Hellenbroich, said in a television interview that he'd been dismissed. Chancellor Kohl is expected to announce it tomorrow.

WOODRUFF: A memorial service was held in Augusta, Maine, today for Samantha Smith, the young American girl who attracted worldwide attention two years ago when she wrote to the leader of the Soviet Union about her fear of nuclear war. Samantha and her father were killed in a plane crash on Monday. Among those who came to the service were the actor Robert Wagner, with whom Samantha was to have starred in an upcoming TV series, and a Soviet official, the first secretary to the Soviet ambassador to the U.S., who was granted special permission to travel to a normally restricted part of the country. He read a condolence from Soviet leader Mikhail Gorbachev to Samantha's mother.

VLADIMER KULAGIN, Soviet diplomat: Everybody who knew Samantha in the Soviet Union will forever hold in their remembrance the image of the American girl who, like millions of Soviet boys and girls, dreamed of peace and friendship between the peoples of the United States and the Soviet Union.

WOODRUFF: And Ruth Gordon, the actress whose career spanned 70 years and included an Oscar for her supporting role in Rosemary's Baby, died today at the age of 88. She was found by her husband, producer and author Garson Kanin, at their summer home on Martha's Vineyard, where officials said she had died peacefully in her sleep. Besides writing two books and several screenplays, the movies she starred in include Inside Daisy Clover, Where's Poppa? and Harold and Maude.

MacNEIL: That concludes our news summary. Coming up on the NewsHour, special trade representative Clayton Yeutter explains President Reagan's rejections of restrictions on shoe imports, a discussion with two white South Africans of how the U.S. can influence events there, and a documentary report on how they rebuilt the Army's First Cavalry Division after the trauma of Vietnam. Shoes: No Protection

WOODRUFF: Our first focus tonight is on perhaps the most controversial trade policy decision to be made this year by the Reagan administration. The President announced that instead of imposing restraints on imported shoes, he will pressure foreign governments to open their markets to U.S. goods. The decision angered American shoe manufacturers, which have lobbied hard to restrict the flood of low-priced foreign shoes into this country. Here is how their spokesman responded at a Washington news conference.

Mr. LANGSTAFF: The decision today is further evidence that the President and the free trade advisors who surround him do not intend to permit the Trade Act of 1974 to function as Congress clearly intended. U.S. industry now must look to the Congress. As a matter of fact, we're in a period of the de-industrialization of America, and this period is in full sway. Trade today is not on the basis of comparative advantage but wage-cutting trade. The result of this is that living standards of the world and of the United States will move to the lowest common denominator. Our U.S. wealth and our standard of living is at grave risk. Free trade as practiced today is destroying America's industry and its wealth.

WOODRUFF: Not all members of the shoe industry opposed the President's decision, however. Strong support came from a coalition of shoe importers.

PETER MANGIONE, Footwear Retailers of America: The President's decision today rejecting the import restrictions on non-rubber footwear is a victory for American consumers, who will continue to enjoy the widest choice of footwear at the lowest possible prices available anywhere in the world. There is no guarantee if we had import restrictions that there would be any increase in shoe production or in shoe employment. We did have import restrictions from 1977 to 1981, and during that period there was no increase in shoe production and no increase in employment.

WOODRUFF: There is little disagreement that some shoe manufacturers have been hit hard by imports. Close to 100 shoe factories closed in the U.S. last year, eliminating 13,000 jobs. Unemployment in the industry is running above 15%, almost double the national average. And America's share of the shoe market is rapidly declining. Only 25% of shoes sold in the U.S. today are American-made, compared to 50% above years ago.

Here to explain today's decision is Clayton Yeutter, special U.S. trade representative and the Reagan administration's point man on trade matters. First of all, Mr. Yeutter, we just heard a gentleman from the shoe industry say that the free trade policy of this administration is killing his industry. How do you respond to that?

CLAYTON YEUTTER: Well, Judy, I don't agree with that at all. His industry is certainly struggling. It's gone through economic travail over the last few years. But that doesn't necessarily mean the government should do something about that. And in fact it seems to me, and it certainly seemed to President Reagan, that doing something in the way of government action would have at best been a short-term benefit for that industry, would not have been beneficial in the long run, and would have cost American consumers billions of dollars.

WOODRUFF: Well, you acknowledge the industry's struggling. What do you mean by that? I mean, we had the International Trade Commission come out a couple of months ago and say that serious injury had been done to this industry.

Mr. YEUTTER: Yes.

WOODRUFF: Where do you think the industry stands?

Mr. YEUTTER: Well, the industry certainly has been injured by imports, Judy, there's no question about that. But you see, the ITC recommendation is simply a fact-finding one which says that imports are hurting the industry. The question then for the President, however, is whether it is proper for the government of the United States to do something about that or do something in response. And the criteria, Judy, to determine that are specified in the law. There are four basic criteria that the President must use to determine whether or not it's in the national economic interests to grant relief in this kind of situation. And obviously the President decided that under those criteria relief should not be granted.

WOODRUFF: But you have had, as we've heard here -- you've had thousands of jobs lost. You've had hundreds, I guess, of factories closed down. Seventy-five percent now of the business in this country is imports.

Mr. YEUTTER: Yes.

WOODRUFF: How bad does it have to get?

Mr. YEUTTER: Well, I don't really think you can do it on thebasis of import penetration, although that's obviously an important factor. It is actually about 77 today. So we've got 23% in volume of pairs of shoes that are being produced domestically.

WOODRUFF: But that's not a criterion?

Mr. YEUTTER: No, that's not a criterion. That's a part of the overall environment, but it's really not a part of the decision-making criteria. Now, obviously, if that number goes down dramatically at some point in time, we have to worry about whether we're going to have a shoe industry in the United States. That has some national security implications and so on. But we're a long way away from that today. And in fact my judgment, Judy, is that the industry will not go down much more in terms of loss of market, irrespective of what happens in this decision today.

WOODRUFF: How can you be so sure? I mean, the industry itself is screaming bloody murder.

Mr. YEUTTER: Yes.

WOODRUFF: They're saying, "Help!"

Mr. YEUTTER: They are, and I think they're wrong.

WOODRUFF: You know better than the industry itself?

Mr. YEUTTER: Well, my judgment, Judy, is that if they would look at it objectively and a little less emotionally -- and that's difficult when you've got factories closing down and people out of work; I understand that. I'm sympathetic to that. I happen to think the industry has reached a point now where, by and large, it's carved out some pretty nice niches for itself in this market, and it's going to preserve those niches and that additional import relief isn't going to help them one iota to preserve that particular niche.

WOODRUFF: You're saying it's bottomed out? Are you saying that?

Mr. YEUTTER: Close to that. Not entirely, because obviously there are some small firms in this business in rural areas which are just going to have a hard time competing. The firms that are successful and the segments of the industry, Judy, that are doing well are those that have -- not on the basis of price, which is really what import relief is all about, to give some price relief. And I don't think the industry is ever going to be competitive on a price basis. What our industry has to do, and what the good firms in this industry have done, they've carved out market niches based on the quality of their shoes or the style of their shoes or the service to their customers and these kinds of things.

WOODRUFF: Well, who is it -- we heard a representative for the footwear industry say that we are presiding over the de-industrialization of this country. I mean, who is he speaking for? I mean, he allegedly is speaking for the industry.

Mr. YEUTTER: Well, we've had some de-industrialization of America over the last few years because of the very strong dollar, Judy. I hope we turn that around because I don't want to see us de-industrialize either. But I don't think that means that we have to produce everything that's produced in the world. I think we should produce in the United States what we do best. I think we should produce shoes where we produce them best, and I think the industry is doing that very well. But I don't think we need to produce every kind of shoe that you and I wear in this country. It seems to me that we ought to let countries around the world who can do a better job at a lot lower price produce the shoes that you and I use.

WOODRUFF: Even if that means many Americans are out of work and that we may be paying higher prices?

Mr. YEUTTER: Well, you're going to pay much lower prices, because putting on import restrictions to have those shoes produced here in the United States is going to increase the price ofshoes dramatically. So this was a good day for you and other consumers of shoes. It probably saved you $3 billion over the next five years.

WOODRUFF: All right, what about the jobs question then?

Mr. YEUTTER: The jobs question is one also that's a bit of a red herring. We've got to be careful about that. There is no question that jobs have been lost in the footwear industry over the last few years, but, had we granted relief today, Judy, some additional jobs would have been lost because we'd have had retaliation against American exports, and there are jobs involved with exports, too. So we'd have gained some jobs in the footwear industry; we'd have lost jobs in our exporting industries.

WOODRUFF: All right, the administration says no to tariffs and no to quotas. What does the administration propose to do exactly?

Mr. YEUTTER: Well, the administration has a very strong trade policy that's based, I think, on a positive outlook toward America. What troubled the President about an import-relief decision here was that it's defeatist. In other words, it's saying that we can't compete with the rest of the world, so let's draw a wall around and conclude that we can't compete, and let's continue to produce high-priced shoes here, even though the consumer has to pay a big price. I think what the President is saying is that we've got to learn to be competitive, and whether it be footwear or anything else, we've got to operate in the global marketplace, and we better do what's necessary to permit us to achieve that objective.

WOODRUFF: And how much time is that going to take for us to become competitive?

Mr. YEUTTER: Well, in a lot of industries, Judy, we're very, very competitive, and that gets back to the jobs point you were making earlier. Certainly we have some jobs that are being lost as these manufacturing entities and firms are coming down because they haven't been competitive. But we're creating jobs, Judy, in a lot of segments of the American economy, doing it beautifully. We've got more people working in America today than we ever have in the history of this country. So, you know, you've got to keep the jobs thing in perspective because we're doing well on jobs.

WOODRUFF: But specifically for the shoe industry, what is it the administration proposes to do?

Mr. YEUTTER: Well, for those who are suffering in the footwear industry because they've lost jobs, this decision today provides that under the -- it's called the Job Training and Partnership Act -- they'll be able to get some assistance for retraining and relocation into other areas of work, and we've got to do that, not only in footwear but in other areas where we're just not very competitive anymore.

WOODRUFF: Does that take care of everybody who needs a job? Is that what you're saying?

Mr. YEUTTER: Well, I'm not sure it's going to take care of everybody because there are a lot of factors that get involved there. Some people are not going to want to move from Maine to the Silicon Valley to get a job in high technology. And, you know, there is going to be some travail in those kinds of cases. But I think the government is going to have to do the best job it can. We can't guarantee, Judy, in my judgment that every industry is going to stay in business the way it is today, every firm is going to stay in business and everybody's going to have the job they have today. In a capitalist society we're going to have some movement in and out of industries and firms.

WOODRUFF: And what about this notion that the Reagan administration is going to pressure foreign governments to open up their markets to more U.S. goods? How specifically can we do that?

Mr. YEUTTER: Well, we're going to do that a lot more aggressively, Judy, than we have in the past. I think that's a part of this total picture. What the President is saying to the world and to the American public is that we don't want to go the protectionist route. We don't want to keep foreign goods out of the United States. We like foreign goods. They keep our standard of living high. If they're more economical, like they are in footwear, we'd rather buy those shoes. But what we've got to do is have a level playing field out here, and we can't have those goods flowing into the United States if our goods can't flow the other direction. And what he's saying is that we're going to aggressively and vigorously make sure that our goods can flow the other direction.

WOODRUFF: How do we do that?

Mr. YEUTTER: Well, we're going to do that with some specific actions where there are unfair trade practices involved, and we're going to announce some of those actions within about 10 days.

WOODRUFF: For example? Can you give us some examples?

Mr. YEUTTER: I can't give you the examples now, but obviously what we're going to do is concentrate on some specific cases of unfair trade practices, and we're going to go after them.

WOODRUFF: And how quickly are these going to take effect?

Mr. YEUTTER: Well, we're going to initiate the actions relatively soon. There'll be an announcement on that within the next 10 days to two weeks, and then of course the cases themselves will have to be dealt with in accordance with law, and that's going to take a period of x months. But it's going to be done very vigorously and very aggressively.

WOODRUFF: And you're sure you don't want to tell us tonight what those will be?

Mr. YEUTTER: I'd love to give you a scoop, Judy, but I'd better hold that for the President.

WOODRUFF: Clayton Yeutter, thank you for joining us.

Mr. YEUTTER: Thanks. Nice to be here.

WOODRUFF: Robin?

MacNEIL: Still to come in the NewsHour, a debate on how the U.S. should influence events in South Africa, and we have a documentary report on the rebirth of the Army's First Cavalry Division. Pressuring Pretoria

MacNEIL: In South Africa a government beleaguered by protest in the streets over its policy of apartheid now finds its attention drawn towards a long-feared problem, the economic impact of the political unrest. Here's a report on today's developments from Peter Gould of the BBC.

PETER GOULD, BBC [voice-over]: The decision to close both the Johannesburg stock exchange and the currency market for three whole days is a measure of the growing political and economic pressure on South Africa. Over the past months, shares worth about $100 million have been sold, mainly by foreign investors trying to find somewhere safer for their money. Many have pulled out for political as much as financial reasons. With international pressure mounting over the country's apartheid policies and the growing unrest on the streets, South Africa's currency has taken a dive. Twelve months ago, before the latest unrest began, the rand was worth 78 American cents. A month ago it was down to 52, but when the state of emergency was declared it plummeted, and by yesterday it had reached a record low of 35. On the London Stock Exchange share prices of some companies with holdings in South Africa have fallen and the market is nervously awaiting developments. But experts believe the country's vast mineral wealth will ensure its economic survival, even if many investors do withdraw their cash.

MacNEIL: The economic squeeze on South Africa tightened further with today's reports that Western banks are demanding South Africa repay bank loans in a sum greater than the Pretoria government has in gold and cash reserves. The authorities are dealing now with what's called capital flight. Investors, like the Western banks, are worried about their money in South Africa. Since January, 1984, some $2 billion has been taken out of the South African economy. In July alone, another $70 million were removed. Many Americans in Congress and outside have argued that the South African government is susceptible to economic pressure from Washington. That's what we ask now first with Ann Seidman, a specialist on southern Africa who is a senior research associate with Oxfam America and on the faculty of Clark University in Boston. She joins us tonight from WGBH in Boston.

Ms. Seidman, I think I called you earlier in the program a South African. You're actually from Zimbabwe, is that correct?

ANN SEIDMAN: No, actually I'm an American citizen.

MacNEIL: Oh, you're an American?

Ms. SEIDMAN: But I worked in Africa for about 11 years, and I spent three years at the University of Zimbabwe as head of the economics department.

MacNEIL: Well, we have that clear then. How severe are the current economic problems in South Africa?

Ms. SEIDMAN: Very severe indeed. The problems that haven't been mentioned, the fact that people, particularly the black majority, about 80% of the population, for example, of Soweto, have been living below the bread line, the poverty line, according to the Carnegie report recently, and there's at least 30% unemployment. And the people who don't have jobs working for whites tend to be the ones who are pushed back into the Bantustans, that 13% of the land area where they have no jobs, many of them no land and no way of survival, so that their standards of living are even lower. So that when you talk of economic problems it seems to me you ought to think about how it affects the lives of the people there in the first place.

MacNEIL: Right. Now, to the point of this discussion, will economic pressure directly from the United States cause political changes in South Africa?

Ms. SEIDMAN: By economic pressure I take it you mean some form of sanctions?

MacNEIL: Sanctions or divestment, whatever happens.

Ms. SEIDMAN: Right. My answer is that I think it would accelerate the need to change. I think that the white minority has responded in no way to the moral outrage of the world at their behavior, and the only way that they're likely to respond is to some form of economic pressure. And the more pressure, I think, the more effectively and the more likely they are to respond sooner.

MacNEIL: In what specific areas would American economic pressure have an effect?

Ms. SEIDMAN: Well, first of all, of course, in the whole area -- the United States' involvement is most important. We are South Africa's major trading partner. One of the things that American companies have been engaged in is refining the oil that's brought into South Africa in violation of the OPEC embargo. If the United States enforced the embargo on oil this would have a significant effect on a white minority's ability to maintain its military and industrial activities which are designed to control the majority of the population in their efforts to get change.

MacNEIL: What other areas?

Ms. SEIDMAN: A second area is the whole area of computers and fancy electronic equipment. The United States has been a major source of this kind of machinery and equipment which has been used for population control, particularly to hold -- for population control in terms of keeping the blacks out of white areas, keeping track of their movements, etc., the security issues. And of course also the white minority is very overstretched in terms of handling supervisory and managerial jobs, and they use computers both in the military and in the industrial sector to make it possible for them to carry out the many kinds of administrative jobs that a modern economy requires. Even in agriculture computerization is very advanced.

MacNEIL: And I think transportation is another area you identified.

Ms. SEIDMAN: And the third one is transportation and the fact that, for example, General Motors is providing not only trucks and automobiles but also locomotives, which are used both by government and the army as well as the private sector. Without the spare parts that are necessary to keep those trucks on the road and locomotives, etc., it would be much more difficult for the white minority to maintain the mobility that's necessary, for example, to move troops and keep a couple of hundred thousand troops up in Namibia and the borders of Angola and opposed to SWAPO, or to move them back into the townships in the kinds of military operations that we saw today on your screen and so forth.

MacNEIL: All right, we'll come back. Judy?

WOODRUFF: Now the argument that sanctions and other economic pressure won't have much political impact from Janet Levine. A former Johannesburg city councillor, Ms. Levine is a former labor spokesman for an anti-apartheid opposition party in South Africa. She left South Africa last year and now lives in Boston. She also is with us tonight from public station WGBH. Ms. Levine, what makes you think sanctions won't have much impact?

JANET LEVINE: I think the South African economy is self-sufficient and reliant not only on America but has trading partners in Europe and Japan, that the slack that would be left by American companies leaving and the American loans not coming into the country, to the government, would be picked up by European and Japanese companies.

WOODRUFF: But you just heard Ms. Seidman say that the United States is South Africa's major trading partner.

Ms. LEVINE: Its major trading partner, but it comes third behind Britain and Germany in investing in the country. And I think that one has to realize that the South African economy and the technological development, the industrialization in the country is such that for the foreseeable future much of the technology that is in the country could be maintained and updated with the plant that already exists in the country.

WOODRUFF: You don't think that any form of economic pressure from the United States would even make a dent in South Africa and would therefore lead to some sort of political change?

Ms. LEVINE: I'm very worried that, should that happen, the American influence in the country would be lost. I believe that it's a major achievement of Chester Crocker, not the Reagan administration, but Chester Crocker himself, to have kept the Nationalist government engaged, talking to him. I believe the Nationalist government would be only too pleased to be rid of America and the American administration, which they regard with suspicion, and have done over the years, and would be quite happy to be left alone to deal with the violence in the country in the way that they think they know best.

WOODRUFF: But what about what Ms. Seidman just outlined for us, in the oil and refining areas, in transportation, in electronics and computers and all those areas? What about --

Ms. LEVINE: In the last 25 years South Africa has been stockpiling oil and has enough oil to keep the country going for at least five to 10 years. These are government figures. I cannot verify them, but these are figures that are put out by the government. As I say, the other equipment will be obtained through other sources. I don't think that in any way America should think that South Africa and the South African economy is reliant on the American economy and American input.

WOODRUFF: Well, what leverage do you think the United States has, or do you think we have any leverage?

Ms. SEIDMAN: I think that one of the problems has been that America has over-emphasized the influence that it has in South Africa. In fact it has very little influence. The influence on South Africa has always come, traditionally and historically, from Britain and Europe. America has been regarded, certainly by the Nationalists, as being soft on liberalism, tied up in human rights and that sort of thing. Black South Africans were far happier under the Carter administration with regard to Carter's stand of looking at South Africa as the polecat of the world. The Reagan administration has led to the alienation of black South Africans from America and American foreign poicy. And I think this is a tragedy that is building up for America because should the government change, or should I say when the government changes and there's black majority rule in the country, America will have lost all the influence, or any influence, that it may have in the region, now, by siding with the government.

WOODRUFF: Ms. Levine, thank you. Robin?

MacNEIL: Ms. Seidman, on that last point, do you agree that that's been the effect of this administration's constructive engagement policy with South Africa?

Ms. SEIDMAN: Well, I agree with the last point that the constructive engagement policy has been constructive engagement with the wrong people, with the minority, and in terms of the majority of the population, they have rejected the constructive engagement policy as actually supporting the minority and strengthening it in opposition to their efforts to win liberation.

MacNEIL: Now, to Ms. Levine's other point, starting with her point that U.S. investment is only third in rank after others, and the slack of any disinvestment would be picked up by Europeans, German, Japan and others.

Ms. SEIDMAN: First of all, my understanding is the United States is second in investment to Britain, and that perhaps there is additional investment through British companies which is not included in that figure. But we won't argue that one. The fact is that the United States plays a leading role among Western countries, and symbolically if the United States were to withdraw from investment, I think it would have a major impact on whether England and other countries would withdraw. France has already agreed that they would not permit any new investment. Japan has long had a policy that they will not invest directly in South Africa, though they do allow local firms to use licenses. Canada has just recently come out against further investment and so on.

MacNEIL: How about that, Ms. Levine, that the U.S. influence is such that other countries would follow?

Ms. LEVINE: I don't take that necessarily to be the case in every instance, and I think particularly in the case of South Africa you will find linkages between other governments going back and historical situations going back over many, many years which would influence or cause influence on American -- if America divested, I don't believe of necessity that other European countries would divest.

MacNEIL: Ms. Seidman?

Ms. SEIDMAN: I just would like to mention that at the United Nations Security Council vote it was Britain and the United States that abstained, but all the other members of the council voted for sanctions. And it seems to me that the United States in fact is -- one of the reasons they're alienating the black population is that we are holding up the efforts of the international community to impose effective sanctions, and of course the black population, according to the Gallup poll associate in England that took a poll recently, about 70% or so is in favor of sanctions, even though they know that it's likely to have an immediate impact on the economy that will be negative. Or maybe because they know that.

MacNEIL: Ms. Levine, how do you read that poll of the black opinion -- urban opinion, I think it was.

Ms. LEVINE: I think that unfortunately in South Africa black people have begun to link apartheid and American foreign policy as the one hand of the struggle and divestment as the other, and should America be seen to divest they see that America will actually be changing its foreign policy towards South Africa. I think this is an unfortunate connotation that has come into the debate.

MacNEIL: Ms. Seidman, how about her point that, regardless of investment, that the South African economy is largely self-sufficient? She mentioned oil reserves that could -- or supplies that could last them five to 10 years. She said they could carry on maintaining their computer equipment and so on for a long time.

Ms. SEIDMAN: I would dispute the figure. I think the United Nations report suggests it's closer to two years or so. It may be longer. But the additional factor is that, in terms of computers, computers are very highly sophisticated technology, and this technology is not now, as far as I know, being produced in South Africa. That's what makes the computer industry so important to South Africa. In the area of nuclear technology, which is, incidentally, one of the areas that the present sanctions proposed in Congress would stop trade in, outside technology is important for the continuation and development of that nuclear technology in South Africa. And South Africans themselves have admitted that. In fact, the South Africans themselves have done a report which indicates that they too think that sanctions would have impact on the economy; the government has done this.

MacNEIL: Do you disagree?

Ms. LEVINE: No, I think there's no question that sanctions would have an impact, but I'm concerned about the political aspect of that that impact would be. I think that sanctions would move the Nationalist government -- and I cannot state this strongly enough, from first-hand experience dealing with the Nationalist government -- that it would move the government into an even tougher stand than it presently has. I think they like to feel in the lager, they like to feel embattled and embittered and fighting the whole world.

MacNEIL: The lager is a South African term meaning --

Ms. LEVINE: Meaning a circle of wagons. So you fight your enemies that are outside from within the protection of the inner circle.

Ms. SEIDMAN: But objectively what is going to move the South African government? If you don't use sanctions which have been called for by African and United Nations for some --

Ms. LEVINE: I think internal reform, internal pressure is the only pressure that is going to move the South African government. And I'd like to make another point here, that the moderate black leaders, Bishop Tutu, Allan Boesak, Nthato Motlana, etc., have been crying. This is the hour of need. They need support from America, from other European governments, for their cause. These are the people who will be leading a free South Africa tomorrow, and these are the people who are not being heeded at this time. And I think that America, far from looking to sanctions that will or won't come in at 1987 for making diplomatic statements about the horror that is happening in South Africa, the American government should be engaging in person-to-person dialogue at the highest official level with the whole spectrum of the black leadership in South Africa. I think that for the South African government to rest in the knowledge that they have the American government behind them, which, if that isn't the truth, that's the impression that's being given, is only going to serve to drive black South Africans and black political leadership into the arms of whomever else is waiting around. And to take away the power from the moderates into the hands of the radicals, and I think this is the most dangerous aspect of America sitting on the sidelines discussing yes or no, should we divest, shouldn't we divest? The country's burning! People are being killed every day. And I think that America must be far stronger on its impact on South Africa.

Ms. SEIDMAN: And the most effective way they can be stronger is to take a stand to impose sanctions and support the call for sanctions by the African nations and by --

MacNEIL: But, Ms. Seidman, how about the point she just made, that sanctions would take years to come into effect and the situation is moving --

Ms. SEIDMAN: No, the United States imposed sanctions on Nicaragua and the next day there was a cut on trade with Nicaragua. The United States has imposed sanctions on other countries. In fact, one of the other things that leads -- I've just come back from southern Africa. I was in Zimbabwe and Tanzania and Botswana. Incidently, in Botswana just after the South Africans had invaded there, which is a shocking place to be just then, and one of the things that impresses me is the people of that area want the sanctions and they want them now. They don't understand why sanctions can be imposed on Nicaragua, for example, but not on this South Africa, which everybody knows is probably the worst violator of human rights in the world. And so we share the desire to support the black population of South Africa, and I may add, the black population of southern Africa. You're talking of an area almost as large as the continental United States with a population of 90 million people.

MacNEIL: What about that, Ms. Levine? If sanctions are effective for Nicaragua, why not --

Ms. LEVINE: But have they been proved to be effective, point one, and point two, I'm sitting here and listening to this divestment argument again, as I've listened to it for many months now, and no one has yet said to me by what magical, alchemical process sanctions by the American government against the South African government are going to move that government to the changes, to the negotiation table, to give away power, to share power? I would just like someone to tell me how the divestment process is going to lead --

MacNEIL: Could you tell her quickly, Ms. Seidman?

Ms. SEIDMAN: Well, I can try. If the United States were to start divesting, requiring firms to divest, if it even just eliminated the double taxation agreement that actually provides incentives for investing there, if we stop trade with South Africa, it would have two effects. One is it would have some effect on the South African economy, as you yourself have just said.

Ms. LEVINE: Yes, it would have --

Ms. SEIDMAN: And secondly it will have a symbolic effect, a leadership effect in the whole Western world in terms of saying to the world, "We feel so strongly about this matter that we are ready to back the black population, the black majority --

MacNEIL: We --

Ms. LEVINE: -- we've spoken out for --

MacNEIL: I hate to interrupt you but, Ms. Seidman and Ms. Levine, I have to thank you both very much for joining us.

Ms. SEIDMAN: Thank you.

Ms. LEVINE: Thank you.

MacNEIL: Thank you. First Cav's Comeback: WOODRUFF: Twenty years ago this month the U.S. Army's 1st Cavalry went into action in Vietnam. Then called the 1st Air Cavalry, its men fought there for 4 years and they paid a heavy price in lives and morale. Now, 10 years since the end of the war, a new 1st Cavalry is emerging as part of a new U.S. Army. A report from special correspondent Stanley Karnow, the author of Vietnam: A History.

STANLEY KARNOW [voice-over]: Armed Forces Day at Fort Hood, Texas, home of the 1st Cavalry Division. These mounted platoons gave the outfit its name and a tradition still preserved in its ceremonies. Officially organized in 1921, the division traces its roots back to the cavalry units that fought in the Civil War and the Indian wars. The cavalry patrolled the Mexican border before and during World War I. In World War II the division dismounted, fighting as infantry in the Pacific, and it later saw action in Korea. The 1st Cav, General MacArthur said, was his first team in combat.

In Vietnam the 1st Cav became air mobile, moving by helicopter against elusive guerrillas who time and again vanished into the dense jungle terrain or blended into the local population.

OFFICER, in combat: Everybody get off the middle of this hill. Second platoon, three o'clock. You're on the other hill.

KARNOW [voice-over]: It was a frustrating ordeal in which American troops won every battle yet could not defeat an enemy willing to take unlimited losses. Many of the 1st Cav senior officers are Vietnam veterans. Some believe the politicians back home prevented them from winning the war. Lieutenant Colonel Duane Hardesty shares that view.

Lt. Col. DUANE HARDESTY, 1st Cavalry: People got this feeling that, well, gee, we ought to be able to go there and clean this place up. I mean, you know, these people don't even have sophisticated weapons or anything. But when you're more of a political tool -- and that was hard for me as a young lieutenant. I couldn't understand that, either. I mean, I was a soldier, and I thought as a soldier I should be able to do soldierly things. I found out as a lieutenant sometimes I couldn't do that.

KARNOW [voice-over]: An Khe,(?) headquarters for the 1st Cav's 16,000 men in South Vietnam. It was then one of the best-equipped, most highly skilled outfits in that or any war. But this was a different kind of war, an unconventional war, not a classic war to gain territory, but to break the enemy's will. The 1st Cavalry Division, like the rest of the U.S. Army, faced a new and tough test.

Capt. THEODORE DANIELSON, 1st Cavalry [1966]: Now, basic training, you heard of tactics like objectives that had a definite terrain objective. When you're fighting the insurgents your objective is the enemy. Consequently, the operations have names like "search and destroy," "search and clear," "seize and hold," "seize and search." We've got to find the enemy before we can do battle with him.

KARNOW [voice-over]: Vietnam battered the 1st Cav. More than 4,000 of its men were killed, nearly 26,000 wounded. It returned home, like other U.S. Army units, its morale eroded, its equipment obsolete, the ranks of its officers and non-commissioned officers depleted.

Major General MICHAEL CONRAD, 1st Cavalry Commander: And so I think I sensed along with some other people a great sense of relief when the Vietnam conflict was ended. So that we could then get to the business then of getting back to basic soldiering. And then to recoup, I think, in some of the needed equipment that we now are just beginning to realize again, to modernize.

KARNOW [voice-over]: For the 1st Cav, now commanded by Major General Michael Conrad, getting back to basic soldiering means getting back to conventional methods. Vietnam was remote and strange, and the Army's strategic mission there was never clear. Now, equipped with heavy armor, the 1st Cav is training to face a familiar enemy, the Soviet Union, on familiar ground, Western Europe.

Maj. Gen. CONRAD: I think we're really really, have set our marks on what we anticipate will be the next war, if it ever comes, and for us that's Europe primarily, and we are much better prepared, I think, in that regard than we've ever been.

KARNOW [voice-over]: The big Pentagon budgets have given the 1st Cav big weapons like the Bradley, the new armored troop carrier, and the 60-ton Abrams tank, the M-1, which delights a young lieutenant.

Lt. ROGER ALFORD: You have to ride in an M-1 to really appreciate it. These things cruise and they're accurate. They fire on the move.

OFFICER: So tell me how you did.

SOLDIER: We did good, sir. That was action-packed. No doubt about it. The adrenaline was flowing. A gunner almost took my eardrums out. But other than that we did pretty good.

KARNOW [voice-over]: Lieutenant Roger Alford personifies the Army's new breed of officer. Most, college graduates, come from ROTC.

SOLDIER: The slipper is the one who goes into the slide and the slider holds the slip in place. Oh, you gotta watch me. Very tricky. Very tricky.

ARNOW [voice-over]: The enlisted ranks also sound enthusiastic. For them the Army is an occupation, not an obligation. With the draft over, they're volunteers. Eighty percent are high school graduates, here because they couldn't find civilian jobs, because it offers advancement or because they like the life.

Sgt. STANLEY THOMAS, 1st Cavalry: I'm a 20-year man. Yeah, staying in permanently, until they kick me out, send me on.

KARNOW: Why?

Sgt. THOMAS: I was in civilian life. I worked as a cook, and there was no job security future there. You know, here I got job security, future, you know. It's good training, and I can move up.

Capt. MIKE PATENAUDE, 1st Cavalry: It's just very rewarding when your soldiers do well all the things that they do do. And when you see them happy and proud, and that's what grew on me and that's why I'm staying in.

KARNOW [voice-over]: In the old Army a soldier's happiness was secondary, but top Army officers now resemble corporation executives, concerned about the well-being of their employees. The 1st Cav's commander, responsible for 14,000 men and women in uniform, even worries about their family problems.

Maj. Gen. CONRAD: Fifty-four percent of the Army is married. That's unheard of. The child care system -- it's not a luxury, it's something we need to have. With that many families there's that many children and you've just got to take care of them. Plus we've got a lot of spouses that are military, so you have both parents are military, and then their children. And who takes care of them? And who answers the call, you know, when the flag is raised, and who doesn't? Or do both?

KARNOW [voice-over]: Concern for individual soldiers is a practical matter. It attracts recruits and encourages them to re-enlist. High morale means a better fighting force. The Army is also trying to keep its outfits together for longer periods. In Vietnam troops were constantly rotated in and out of units. They frequently fought side by side as strangers, and their spirit often suffered as a result.

Maj. Gen. CONRAD: One of the weaknesses of our efforts over there had to do with the constant turbulence and the in-and-out of people in the unit. It makes a much better fighting force if you can keep units together. Being together for a length of time you develop that esprit de corps, you develop that self-confidence in the individuals and in one another's buddies. And you get to standardize a lot of the unit's effort toward accomplishing their mission.

KARNOW [voice-over]: If the 1st Cavalry division and the rest of the Army have been rebuilt since the end of the Vietnam War, they largely owe their rebirth to a change in the national climate. America's younger generation is no longer rebellious. Old-fashioned patriotism has staged a comeback.

Capt. PETAUDE: Yeah, I was a long-haired high school kid back in '74, and I did not, you know, admittedly, I had a very low impression of the military at the time, as did a lot of my friends. But I don't now. It's a cycle. You're a radical for eight years, and then you're a conservative for the next eight years. I don't know what it is.

Lt. ALFORD: I think I got a little tired when I was growing up of people, you know, bad-mouthing pretty much, you know -- everybody can complain, you know, but a lot of people don't do something about it.

KARNOW [voice-over]: But these soldiers, for all their eagerness, are prudent.

Lt. ALFORD: You have television and books and they romanticize war a lot, you know. And everybody, "Let's go in there and kick some butt," you know. But to me, I'd hate to go to a war and lose some of my men, you know. That would be a responsibility.

KARNOW [voice-over]: As professionals the senior officers of the 1st Cav say they would obey orders and fight anywhere they're sent, but they also say if they had to go to war, it ought to be the kind of war they know how to fight.

Maj. Gen. CONRAD: I would much rather have a very clear-cut mission and objective than the one that got clouded in Vietnam. Selfishly, I'd like to engage in a war, I guess, that would allow me to use everything that I'm blessed with here in this division. We've got a lot of fine, modern equipment and we've got great soldiers and what not. I'd hate to have to leave part of that behind or not be able to use part of it for whatever reason.

KARNOW [voice-over]: For the older officers of the 1st Cav, Vietnam was a trap. They want no more undeclared wars in Central America, the Middle East or elsewhere, no more wars without clear-cut objectives, no more wars to rescue unpopular foreign governments, and, above all, they want no more wars without public support at home.

Lt. Col. HARDESTY: You know, if a president of the United States tells me that he wants me to go to Country X tomorrow with my cavalry squadron, I'll go, and I will be prepared to do my job. But if the American -- if the people of this country are not going to support their young people, if they're going to send them off someplace and ask them to give their life and then not support them, that's a tragedy. I think that is the one single tragedy of the Vietnam War.

WOODRUFF: That report by special correspondent Stanley Karnow. Ruth Gordon

MacNEIL: Finally tonight we take a note of the death of one of America's most enduring entertainment figures. Ruth Gordon died today at the age of 88 in her sleep at her summer home at Martha's Vineyard. Her career began 70 years ago in 1915 when she appeared in a production of Peter Pan. Since then she's appeared in countless plays and films. Among her most famous roles were productions of Abe Lincoln in Illinois and the lead in The Matchmaker, which later became the musical, Hello, Dolly. Along with Garson Kanin, her husband of 43 years, she wrote two of the movies that made Katherine Hepburn and Spencer Tracy such a memorable pair, Pat and Mike and Adam's Rib. One of her great successes came in the 1968 movie, Rosemary's Baby, for which she won an Oscar.

0RUTH GORDON, ""Rosemary's Baby" [courtesy Paramount Pictures]: Hi, dear. We're not bothering you, are we?. That's my dear friend Laura Louise. Lives up on 12. Laura Louise, this is Guy's wife Rosemary.

ACTRESS: Hello, Rosemary. Welcome to the Graham.

Ms. GORDON: Laura Louise just met Guy. She wanted to meet you too. Can we come in?

MIA FARROW: Of course.

Ms. GORDON: There you are, go ahead.

MacNEIL: Since then she's appeared in a number of movies, including Inside Daisy Clover, Harold and Maude and in two pictures with Clint Eastwood. To the end, Gordon was energetic and engaged with life, as was demonstrated in an interview with Dick Cavett in 1979 about aging.

Ms. GORDON [Dick Cavett Show, 1979]: You know, everybody's so busy trying to stay well, trying to stay healthy, trying to stay everything. You know, when I was a little girl my father was a foreman in a factory and he got $37 a week, and they'd say, "Oh, well, back then $37 was a lot of money." Well, thank God I've lived my life so that $37 was never a lot of money. Thirty-seven dollars was a skimpy lot of money to bring up me, to take care of my mother, and yet, and yet we had treats. We'd have a turkey for Thanksgiving. When the strawberries got cheap we'd have strawberries, and once a week we had heavy whipped cream. And we had little treats. Dammit, nowadays everybody -- the money -- it's all over the world. Everybody has got loads of money except us people. We haven't got it. And couldn't there be some kind of thing in Congress, and I think I'll go down and run for it. There's got to be something in Congress where there's some money left over not only to stay well, to not only put a roof over your head, but to have a hell of a good time. Believe me, that would keep people younger.

MacNEIL: Ruth Gordon, who died today at 88.

WOODRUFF: Turning now to a last look at the day's top stories, police in South Africa broke up demonstrations near the prison housing anti-apartheid leader Nelson Mandela. President Reagan rejected a plan to restrict shoe imports, and the FAA told U.S. airlines to check planes that use a Pratt & Whitney engine similar to the one which exploded last week in England. The engine powers two out of every three U.S. commercial jet liners. Good night, Robin.

MacNEIL: Good night, Judy, that's our NewsHour tonight. We'll be back tomorrow night. I'm Robert MacNeil. Good night.