The MacNeil/Lehrer NewsHour

Intro

ROBERT MacNEIL: Good evening. Here are today's top news headlines. President Reagan proposed a ceasefire in Nicaragua and talks between Sandinistas and contras. President Reagan and Senate Republicans reached a compromise budget agreement. The Pentagon charged General Dynamics with overcharging the government by $244 million. Treasury Secretary Baker warned Congress against a trade war with Japan, saying the U.S. could lose it. Jim?

JIM LEHRER: On the NewsHour tonight, after the news of the day we will go back to the two major stories in detail. Judy Woodruff reports on the tos and fros of making the Republican deal on the budget, and Senate Majority Whip Alan Simpson will tell us about the final product. Then State Department official Langhorne Motley and House Whip Tom Foley will discuss the new Nicaragua plan, as will the president of Colombia in a Newsmaker interview.News Summary

LEHRER: President Reagan today went after $14 million for the guerrillas in Nicaragua with a new approach. He called for an immediate ceasefire between them and the leftist Sandinista government they wish to overthrow, to be followed by peace talks mediated by the Catholic Church. He said the $14 million would not be spent on military equipment for 60 days of talks, but only for food and other supplies. The proposal was in response to generally accepted reports Congress would turn down the aid request without something new added. Mr. Reagan put the proposition to Congress this way.

Pres. RONALD REAGAN: Democracy can succeed in Central America, but Congress must release the funds that can create incentives for dialogue and peace. If we provide too little help, our choice will be a communist central America with Communist subversion spreading southward and northward. We face the risk that a hundred million people from Panama to our open southern border, could come under the control of pro-Soviet regimes and threaten the United States with violence, economic chaos and a human tidal wave of refugees. Central America is not condemned to that dark future of endless violence. If the United States meets its obligations to help those now striving for democracy, they can create a bright future in which peace for all Americans will be secure.

LEHRER: Reaction from congressional critics came immediately.

Sen. PATRICK LEAHY, (D) Vermont: If you can call the MX a Peacekeeper missile, you can call this a peace plan. The President says we're going to have a dialogue at the time when the President's about to take off out of town for 10 days and most of the Congress is going to take off out of town for 10 days. If that's his idea of a dialogue I can't wait to see their definition of humanitarian aid.

LEHRER: The Nicaragua proposal is one of our two focus segments tonight. It will include Colombian President Betancur's view of it in a newsmaker interview. His briefing on the plan came directly from President Reagan at the White House this afternoon. Robin?

MacNEIL: After weeks of skirmishing, chiefly over defense spending, President Reagan and Senate Republican leaders today agreed on a compromise budget plan. The President accepted a big reduction in defense spending, but the senators accepted elimination of many domestic programs. The deal was announced by White House chief of staff Donald Regan. He said the agreement meant eliminating or phasing out 17 programs, including Amtrak, revenue sharing, the Job Corps and Urban Development Action Grants, and it meant freezing or reforming 30 other programs, from farm price supports to highway construction. Social Security cost-of-living increases would be limited to 2 , or about half the rate of inflation. Defense spending would be held to a growth of 3 over inflation instead of the 5.9 the President has fought for. In our lead focus section tonight, more details of the agreement and the story of the political maneuvering that produced it.

And a development related to defense spending: the Pentagon today accused General Dynamics of overcharging by $244 million for submarine and other contracts. Pentagon spokesman Michael Burch said the total had been determined by a team of government auditors, and the government would recoup the money. The company said it had not seen the latest audit and had no idea about the origin of the figures or the years covered.

LEHRER: The administration sought today to cool down the anti-Japan talk in Congress over trade. Treasury Secretary James Baker told a Senate committee an all-out trade war is not the way to open up Japanese markets to U.S. products. "I'm not sure we'd win that," he said. Japan's deputy foreign minister also arrived in Washington from Tokyo today with a similar message. He came to give the Congress as well as the administration the Japanese view of the situation, most particularly its distress over congressional threats of trade retaliation. That kind of talk continued to be heard today. The House Democratic leadership even announced a new task force to take the Japan trade problem to the American people, and they said they had a message for the Japanese envoy.

Rep. JIM WRIGHT, (D) Texas, House Majority Leader: I am hoping for his returning with a clear-cut understanding that the time has passed when the United States will continue to tolerate unfair trade practices, practices which exclude our goods from their markets on the same basis that we permit their goods to be sold on our markets; other practices which tilt the playing field so that it isn't an even playing field. We hope that we will be able to be helpful in causing him to return with a clear-cut understanding that a new age has dawned and that the United States demands reciprocity in its truest sense.

LEHRER: The Japanese did get some support from the West Germans. The West German economic minister, Martin Bangemann, was in Washington today and said half the U.S. trade problem is caused by the high value of the U.S. dollar, which is caused by the U.S. federal budget deficit, not by Japan.

MacNEIL: One American industry that has been particularly hurt by foreign competition, as well as by labor problems, is copper. Today in Arizona, one of this country's biggest copper companies, Phelps-Dodge, closed one of its major plants. For a report from a small town that has long depended on copper for its existence, here's George Bauer of public television station KUAT.

GEORGE BAUER, KUAT-Tucson [voice-over]: Workers poured the last copper anodes today at the Ajo smelter. Now the huge facility will power down. By next Wednesday it will close completely. Two hundred more workers will be out of jobs; many will move out of town.

LARRY LARREMORE, worker: There's just nothing left here anymore. The mine is really essentially what keeps this town going, and without the mine there is nothing really around that pays anything, so I'll have to go.

BAUER [voice-over]: Since 1980, 1,300 jobs have been lost here. Just last August, the mine and concentrator were closed, 600 workers laid off. Phelps-Dodge says the price of copper is too low, so this facility will remain closed indefinitely.

KEN BENNETT, Phelps-Dodge: But we would need a significant and long-lasting improvement in the copper price. We don't know what that figure would be, but we can say that it would be well and firmly above 80 cents a pound.

BAUER [voice-over]: While many leave Ajo, others stay. They've been here all their lives. A local social service agency will help the unemployed with food and other aid. It will also train displaced workers for new jobs. Residents say Ajo has suffered before; now it's time for the town to stand on its own feet.

GABRIELLE DAVID-BARTON, Ajo Chamber of Commerce: It's going to make us pull together as a community, take a hard look at ourselves and figuge out what we can do instead of depending on a corporation to do it for us.

MacNEIL: That report from George Bauer of station KUAT in Tucson. In other economic news, the fate of the failed Home State Savings Bank of Ohio remained up in the air tonight. It was the failure of Home State which precipitated the savings and loan crisis in Ohio last month. Another Ohio bank which agreed to buy Home State dropped its offer today, leaving the Chemical Bank of New York the sole bidder and negotiations continuing.

LEHRER: Overseas, the North African nation of Sudan was hit by a general strike today. Air traffic, most businesses and communications in and out of the country were shut down. The Associated Press says there were widespread demonstrations and protests but no violence. The strikers are calling for the ouster of Sudanese President Nimeiri. Nimeiri is in the United States now on a visit, but made no comment today on the actions against him back home. He met with President Reagan Monday at the White House.

And in the Persian Gulf war, Iraq said it fired more missiles at civilian targets in two Iranian cities. Iran said 25 people died and 70 others were wounded in one of those attacks. An Iraqi spokesman said the attacks on civilian targets will continue until Iran agrees to peace talks.

MacNEIL: The prime suspect in the murder of a U.S. drug agent in Mexico was arrested today in Costa Rica. U.S. and Mexican sources said the man was Rafael Caro Quintero, wanted in the slaying of Enrique Camarena Salazar, a special agent for the U.S. Drug Enforcement Agency. Efforts to extradite him back to Mexico have begun. The murder caused deep strains in U.S.-Mexican relations.

In New Orleans, Tulane University announced plans to drop men's basketball following disclosure of a point-shaving scandal allegedly involving drug payoffs. University President Eamon Kelly also said Tulane would accept the resignation of its basketball coaches for violations of NCAA rules not connected with the point shaving. He said these included cash payments to players on the basketball team. Eight men, including three players, have been arrested on the point-shaving charges. Budget Compromise

MacNEIL: We devote our lead focus section tonight to the deal congressional Republicans have just hammered out with President Reagan on the budget. Judy Woodruff has been following that story closely. Judy?

JUDY WOODRUFF: Robin, it's been a long and rocky road in reaching today's agreement. Senate Republican leaders have been trying to come up with a package acceptable both to the President and a majority of the Senate for months. In fact, it was even unclear today whether or not all concerned would sign off on this compromise. One of the key players in negotiating the deal was Senator Alan Simpson of Wyoming, the assistant majority leader.

Senator Simpson, well, since I guess defense is what everybody's talking about most, let me ask you about that. Exactly what was given on each side on defense?

Sen. ALAN SIMPSON: Well, if we did it right, we have irritated everyone in the United States. And I think we may well have come to that. Defense was in there for a heavy feature of $18 billion the first year; the second I don't recall; but the total three-year defense cut, reduction of the deficit from defense alone was about $97 billion. That's heavy, heavy ticket item.

WOODRUFF: Now, the President had asked for a 6 increase over inflation, and you all managed to cut that back to three.

Sen. SIMPSON: Yes, and the difference between the Senate Budget Committee's deficit reduction on defense and this one is about $15 billion. So we weren't that far off, considering you're talking about billions. But the President went along with it, and I'm sure it was tough for him. With our revision with what we did with Social Security -- that was a tough one for him. He's aboard, he's fully committed. Here we go; it's going to be a great adventure; it's going to be awfully tough.

WOODRUFF: Why did he give on defense when he was so adamant about that amount that he originally said he wanted?

Sen. SIMPSON: Because we were saying in the Senate, you can't do, you can't cut all these programs and leave defense and Social Security out of the mix. There's no way to do it. In fact, you can't get to deficit reform or budget reduction, anything, can't do it, not possible. A freeze won't get you -- a freeze won't get you hardly anywhere where you want to go. So he came aboard because we said, look, we don't want to cut the cost-of-living allowance on Social Security. We're going to give everybody 2 more per year for three years. And believe it or not, that'll hit right in where we were with regard to the freeze, the one-year freeze -- about 20 billion bucks over three years.

WOODRUFF: Now, the President originally had said he didn't want to touch Social Security. In fact, in the campaign he said he didn't want to see any cut. But this will amount to a cutback in the increase the recipients would be getting, is that right?

Sen. SIMPSON: No, he can keep his promise, because he said that he would not be responsible for any cut in the existing benefits of Social Security. And he's sure keeping that promise to the American public, because they're going to get 2 more than they've got right now. They're going to get it for each of the next three years. And if inflation goes to 10 , they're going to get 2 less than inflation. So it's the cost in the Consumer Price Index minus two, and it's across the board for the next three years.

WOODRUFF: What about on some of these very sensitive domestic programs? It sounds almost like the President gave on defense and you in the Senate Republican leadership pretty much gave him what he wanted in terms of wiping out some of these programs.

Sen. SIMPSON: Well, you can't say that he got what he wanted when we had a $97 billion difference from his proposal in defense. It was anguishing, and it's going to be just as anguishing on the floor. Every single senator, every single congressman is going to say, "Wait a minute, you can't possibly mean what you've done." I really believe that if the American people, if we read them correctly, that they're saying, "You know, we don't believe you'll ever do it, but we would stand for it if you do it to everybody." Well, here's the test, 'cause it's right in here, and everybody is affected.

WOODRUFF: But most of the programs that he wanted -- many of the programs he wanted eliminated and many of those that he wanted cut back, you all have agreed to go along with him on. Is that correct? Amtrak, UDAG -- Urban Development Action Grants?

Sen. SIMPSON: Well, a lot of them we didn't, because you see, there were about a hundred different programs there. And we did go with him on the elimination of some, but where we got the big bucks was a reform in the Medicare system, where over a three-year period we can save $18 billion by reforming the methods of administering Medicare, another $5 billion in the way we administer Medicaid. If you look in there, the reforms that are going to be built in to the three-year pattern are what will save this country in the future. We have finally grappled with the snakes, and said in the out-years -- which is that marvelous phrase, the out-years -- we finally are going to put a different emphasis, a different formula on those programs as the group of people coming into them rises and rises.

WOODRUFF: Who did the most giving?

Sen. SIMPSON: There are no winners and no losers in that room. Everybody --

WOODRUFF: You really mean that? I mean, in every deal isn't there always a --

Sen. SIMPSON: I never saw anybody that didn't -- and the other senators that came into the room periodically as they were brought in as committee chairman, and as Bob Dole would bring them in, or Pete Domenici -- every one of them left with a lump in their throat about the size of a hockey puck.

WOODRUFF: Well, Senator, as you know, because we taped an interview with you earlier this week, we've been preparing a report over the past week or so on just how difficult your task has been in working out an agreement, and trying to answer the questions: what obstacles may still lie ahead and why it's taken so long to reach a compromise with the President?

Pres. REAGAN: And if Congress can't cut, I will. And let me tell you, let me tell you. It really would make my day.

WOODRUFF [voice-over]: It's been a frequently defiant Ronald Reagan since the November election, a President daring the Congress to disagree with him over federal spending. It's a far cry from Mr. Reagan's first term in office, when four years ago he swept Congress off its feet, pulling off one big victory after another. First, massive budget cuts; then historic tax cuts. It was a virtuoso Reagan performance, enlisting the support not just of his fellow Republicans but many in the Democratic opposition as well. But four years later, prospects are nowhere near as bright.

Pres. REAGAN: Right now I'll settle for a tie.

WOODRUFF [voice-over]: Kenneth Duberstein used to head the White House Congressional Affairs Office.

KENNETH DUBERSTEIN, former White House aide: In 1980 the President and the Republican Party ran a very issue-specific campaign: if elected, the Republican team promises this, this, this and this. In 1984, it wasn't quite as issue specific. There wasn't a platformfiagenda that they were running on. And so I think that has enabled people to have some more flexibility as far as staking out positions in the Republican Party that may not be totally in harmony with the President.

NORMAN ORNSTEIN, political scientist: The basic theme was, "You liked the last four years, you'll love the next four years, and we'll do more of the same."

WOODRUFF [voice-over]: Norman Ornstein, a political scientist who studies the Congress, says even members of the President's own party don't have an incentive to go along with the deep spending cuts he wants this year.

Mr. ORNSTEIN: They don't see a public out there that's hungering for those specific budget cuts. And they don't even see a public that's out there that's demanding immediate action on the deficit no matter what the immediate consequences.

WOODRUFF [voice-over]: Then there's the fact that 22 of the Senate's slim majority of 53 Republicans are up for reelection next year. The Senate's assistant Republican leader, Alan Simpson, says there are limits to how far Republicans facing the voters can go.

Sen. SIMPSON: And when they look you right in the eyes as mature people and say, "Look Al, I can't touch that with a stick, that's it. You know, I'd like to help this President, but this is it, this is one issue that I've always been in and I can't help." And you understand that. You deal with them as maturely as possible, and that's that.

WOODRUFF [voice-over]: For all those reasons, the Reagan budget proposals sent to Capitol Hill in February got a frigid reception, including in the Republican-run Senate Budget Committee. One member who's up for reelection next year, Mark Andrews of North Dakota, explained why.

Sen. MARK ANDREWS, (R) North Dakota: If you've got a budget as we do this year, $975 billion; the President's calling for increases in defense -- that's $300 billion of the budget; you've got to hold harmless and let move up with inflation entitlements -- that's $250 billion of the budget; you can't do anything about interest on the national debt -- that $150 billion; if my arithmetic is right, we've covered $700 billion. How are you going to reduce a $200 billion deficit by just addressing $275 billion worth of spending? It can't be done.

WOODRUFF [voice-over]: Perhaps more important, Mr. Reagan's insistence on an almost 6 increase in Pentagon spending, coupled with drastic cuts in domestic programs like education and nutrition for the poor, was perceived as unfair.

Sen. SIMPSON: The defense budget must come down, and if it doesn't then none of us have the stomach to go the route on the WIC program and Amtrak and all the pain stuff, which is peanuts compared to a $313 billion defense budget. That's where we are.

WOODRUFF [voice-over]: Even the President's biggest boosters in the Congress say the months of stalemate could have been avoided. Republicans who went to meetings at the White House as long ago as December say they explained then what would and wouldn't fly politically.

Sen. ANDREWS: We thought we were sending a message. But it doesn't seem to have been received. And I don't know whether the President is being insulated by a group of people who can't seem to look at that candid picture or not, but he isn't being served well by staffers who let the White House continue to say they want to do something about the deficit but not do it constructively.

WOODRUFF [voice-over]: But most believe the real hangup is with Mr. Reagan himself, and the fact that shrinking the deficit is not his top priority. Fritz Hollings is the second-ranking Democrat on the Senate Budget Committee.

Sen. ERNEST HOLLINGS, (D) South Carolina: President Reagan feels that his mission is to dismantle the government helm on the Potomac, and so he's using the deficits as a sort of hammer over the head of the Democrats, if nothing else.

Mr. ORNSTEIN: The pressure from the deficits is a very convenient way to force attention to making cuts in a narrow range of areas which don't have a big budget impact but which do have a big impact in terms of the intrusiveness of government in our lives. And so he's trying to use the deficit to push action in this way. But members of the Congress know that the public doesn't quite see it in the same fashion. They want to cut the budget but they don't want to cut these areas of government out of their lives.

WOODRUFF [voice-over]: The fact that the President chose to use only one line in his State of the Union address to stress the need to cut the deficit even Republicans say didn't help his case much either.

Sen. ROBERT DOLE, (R) Kansas, Senate Majority Leader: Now, had there been that early recognition by the White House that we have to deal with the deficit, and had they called in the Republicans, the 53 of us in the Senate, and the House, said, "Okay, our number one priority this year is the deficit," that might have made a difference.

WOODRUFF [voice-over]: In any event, after the Reagan spending program was killed in the Senate Budget Committee, Republicans in the majority on the panel passed their own budget calling for much a smaller defense increase and fewer domestic cutbacks. Finally, the last week in March, the White House and Senate Republican leaders agreed to try to resolve their differences.

REPORTER [March 21, 1985]: Are you prepared to look at that budget and make some compromise?

Pres. REAGAN: Oh yes. The idea was, we put together a budget, and after long bloody hours, that we think does the job. But we recognize that others may have other ideas. But now they've got something that we can sit down and talk about, theirs and ours, see where we come out.

WOODRUFF [voice-over]: On the congressional side, however, the frustration level was high.

Sen. PETE DOMENICI, (R) New Mexico: If we could have resolved some of these issues a couple of months ago, we might have been much further along. I can say without any reluctance, we would have a much easier time and we might already have a budget.

WOODRUFF [voice-over]: Later than they would have liked, Senate Republicans began holding secret meetings with White House negotiators. After almost two weeks of the kind of hard bargaining that usually goes on between Republicans and Democrats, both sides were hinting of progress. But it was apparent it hadn't come easily. Budget Committee Chairman Pete Domenici.

Sen. DOMENICI: It's very difficult. The two toughest ones clearly are how much defense expenditures do we need, or conversely, how much can the President reduce his request over the next three years and still get a solid defense program for the American people and for the free world? And the other is Social Security.

WOODRUFF [voice-over]: Republican leaders say they have spent much of their time trying to persuade the President and his people that if they don't agree to trim their request back on defense now, the Senate will chop it much more later.

Sen. SIMPSON: What we're trying to express to him is that these things can happen. And I think he's listening, and I think Don Regan is listening, knowing that if it doedn't happen that way, if we ever get to a vote on the defense budget in the U.S. Senate, there'll be enough Democrats and Republicans to put a shocking vote on the board.

WOODRUFF [voice-over]: Senate Majority Leader Dole says the President has also come around on the priority of reducing the deficit because of economic conditions.

Sen. DOLE: We're having trouble now with our exports. We're having trouble with trade problems. We've got another big trade deficit. I think just reality set in.

WOODRUFF [voice-over]: Even some agreement between the White House and Senate Republicans, however, does not assure the package would win a majority of votes on the Senate floor, because Republicans like Mark Andrews, even though he's up for reelection next year, are not likely to go along with the deep cuts in domestic programs the President wants.

Sen. ANDREWS: The point is, the Republican Party has a responsibility to get the deficit under control. And if they show us a situation that will get the deficit under control without gutting human nutrition programs, without gutting education programs, without throwing farmers down the drain, without forgetting the need to have research to fight cancer -- these are investment programs; these aren't spending programs. We need them. I'm proud to be a Republican, but I'm not a rubber stamp for everything that the White House says.

WOODRUFF [voice-over]: If Republicans are having trouble swallowing domestic cuts, Democrats are talking openly of raising taxes on corporations, an idea the President rejects completely.

Sen. HOLLINGS: I can't go home and say, "Look, I've cut women's, infants' and children's feeding and done nothing about this corporate crowd flying their dogs around, writing off these airplanes, buying Mercedes-Benz automobiles, going around like there's no tomorrow spending like drunken sailors."

Sen. LAWTON CHILES, (D) Florida: How can you justify freezing someone's Social Security and you're having a corporation earning $6 billion and getting back $280 million from the government in tax rebates?

WOODRUFF: Now, Senator Simpson, obviously those interviews were done a little bit before you reached an agreement. But let's just take Senator Andrews' point on the problems he would have with the domestic cuts. Now, he's not the only Republican who's going to have problems. How are you going to ovecome that kind of opposition in your own party?

Sen. SIMPSON: We're going to put it all on the table. It's going to come out on the floor of the U.S. Senate. And you're going to have to assure that there is -- you don't have to assure it; either you have a bipartisan approach to it or you have nothing. And we think that we've presented enough thoughtful things in there to attract members on the other side of the aisle, because we'll lose eight or 10 every single vote if we go into it one by one.

WOODRUFF: Well, what about -- for example, we were told by, I guess, a couple of Republican Senate staff people today that the senators were planning to offer a lot of amendments to eliminate some of the cuts that you all are proposing. How many Republicans are you going to be able to hang on to? Is it too early to know?

Sen. SIMPSON: I don't know. But I'm of the opinion that somewhere along the line you got to buckle up your guts and get in the game. Now, if we didn't do this -- and it's going to create shrieking and howling, and you know, now we're going on a recess, and in 10 days Lord knows what will be generated out in the land. But you either have -- if you're in the majority, you produce something and say, "There, we'll take all the risks that go with that rather than just sit back and be absolutely clubbed to death by every special interest in the United States." I think the American people -- bless them and thank heaven they're smarter than we are -- are saying, "You know, this is goofy. But by gad, you did that, you actually gave us a package and we can look at it. And if that's going to get this deficit down so that the interest rates will go down" -- that'll be the first message that comes from this great package, you get this deficit down and interest rates in this land will come down, and that can be the greatest gift we can give to the special interests, to the people of the United States, the whole caboodle.

WOODRUFF: You actually think the public outcry over reducing the deficit is going to be enough to give these senators the courage, and eventually the House members the courage, to vote for some of these unpopular cuts?

Sen. SIMPSON: That was the thing. A lot of us, or some said we don't need the President on board here; we've just got to go bleed and do it. But with the President on board and his awesome powers to go around this country in the next, you know, two weeks and say, "I'm ready, I'm fully aboard," I really do believe that anybody running in '86, Democrat or Republican, is going to be better off if he says -- if you want to get into the political hacking on it -- he's going to be better off if he says, "You know, I tried. I tried to cut the deficit of the United States and I failed. I voted some terrible votes: WIC, mother's milk, the whole works. I did it all, but I tried." He's better off than the guy that goes back and say, "There were a bunch of screwballs in Washington, Democrats and Republicans, who tried to cut the deficit, but I stopped them. I kept your HUD program. I kept your wastewater." And some guy in the back of the room is saying, "Aren't you the guy that got us here to this point? You know, I don't like that, what you did, and I think you're in peril."

WOODRUFF: Just one other thing. The point the two Democratic senators raised about, "Well, if we're going after these programs that hurt the poor and the middle class eventually, why don't we go after the corporations and come up with some kind of a minimum corporate tax or raise corporate taxes?"

Sen. SIMPSON: Well, keep your eye on Bill Bradley and Dick Gephardt and Jack Kemp and Bob Kasten. They're four horsemen that are running quite a package around the track. And with Jim Baker as jockey and steward, watch what's coming up toward the finish line on tax reform. But we do have to do something about corporations who pay no taxes to the United States, and then we give them their own bank to do that, the Ex-Im Bank.

WOODRUFF: So despite the President's opposition, a tax increase might just be in the works?

Sen. SIMPSON: You betcha. We'll try to keep it separate here, but you watch, it's going to come out in May. And the Treasury will present their package, and those four brigho people of both parties who are not lobbing shots at each other will put together a very interesting proposal for us.

WOODRUFF: Senator Simpson, thank you once again for being with us.

Sen. SIMPSON: You bet, Judy.

WOODRUFF: Jim?

LEHRER: Still to come on tonight's NewsHour, a major focus section on President Reagan's new Nicaragua aid approach, with State Department official Langhorne Motley, House Whip Tom Foley and a newsmaker interview with Colombia President Betancur. Proposal for Peace

MacNEIL: For our other big focus section tonight we examine in more detail President Reagan's new plan to stop the fighting in Nicaragua and get the Sandinistas to restore democratic freedoms. We'll have an exclusive interview with Colombia's President Belisario Betancur, a discussion with a senior State Department official and a leading congressional Democrat. But first, back for a fuller version of President Reagan's announcement at the White House.

Pres. REAGAN: I'm calling upon both sides to lay down their arms and accept the offer of Church-mediated talks on internationally supervised elections and an end to the repression now in place against the Church, the press and individual rights. To the members of the democratic resistance, I ask them to extend their offer of a ceasefire until June 1st. To the Congress, I ask for immediate release of the $14 million already appropriated. While the ceasefire offer is on the table, I pledge these funds will not be used for arms or munitions. These funds will be used for food, clothing and medicine and other support for survival. The democratic opposition cannot be a partner in negotiations without these basic necessities. If the Sandinistas accept this peace offer, I will keep my funding restrictions in effect. But peace negotiations must not become a cover for deception and delay. If there is no agreement after 60 days of negotiations, I will lift these restrictions unless both sides ask me not to.

I want to emphasize that, consistent with the 21 goals of the Contadoran process, the United States continues to seek: (1) Nicaragua's implementation of its commitment to democracy made to the Organization of American States; (2) an end to Nicaragua's aggression against its neighbors; (3) a removal of the thousands of Soviet-bloc Cuban, PLO,Libyan and other military and security personnel; and (4) a return of the Nicaraguan military to a level of parity with their neighbors.

1st REPORTER: What's the incentive for the Nicaraguan government, Mr. President?

Pres. REAGAN: Well, to end the bloodshed that is going on, to end the great economic crisis that is growing ever more worse in their country because of what they've done.

2nd REPORTER: Mr. President, Tip O'Neill says that this is a dirty trick, that you're trying to hoodwink the American public into thinking that it is humanitarian aid but it really is a secret plan to proceed militarily.

Pres. REAGAN: Well, I don't think he's heard this particular plan yet. There has been consultations, but if he's calling this a dirty trick, he's got a funny definition of dirty tricks.

2nd REPORTER: Do you think that this will make Congress more likely to accept your aims?

Pres. REAGAN: Well, because Congress, in all of their efforts to hinder our continued aid to the contras and to democracy down there, have emphasized the need for peaceful and political and -- solution, and a solution of the kind we've talked here that would result from discussion between the parties.

3rd REPORTER: Mr. President, you've been saying that the $14 million you think is essential. But if Congress should turn you down, will you look for some other avenues to help the contras, some other way to continue your desire to see a restructuring of the Nicaraguan government?

Pres. REAGAN: Well, we're not going to quit and walk away from them, no matter what happens.

4th REPORTER: Do you contemplate any military action against Nicaragua? You seem to be offering eitherfior, and the threat is the $14 million. Is that really enough to overthrow the Nicaraguan government?

Pres. REAGAN: In -- I think it isn't a case of overthrowing; it is a case of returning to the goals of the revolution that both the contras and the Sandinistas fought for. And as far as our making war or anything, that has never been our intention, and we've made that -- we've repeated that over and over again.

5th REPORTER: Mr. President, if there is a ceasefire and there are talks, but they don't produce anything, what does the money, the $14 million, go for then? Back to purchasing weapons for the contras?

Pres. REAGAN: I said after 60 days if no agreement can be reached, and unless both sides ask us to continue the same process, then I would think that we could use that $14 million to help the contras in any way.

MacNEIL: In Managua, the Nicaraguan government had a quick and sharp reaction to President Reagan's announcement. Foreign Minister Miguel D'Escoto described it as a move to get Congress to approve money for the contras.

MIGUEL D'ESCOTO, Nicaraguan Foreign Minister: And this is a desperate move by a man who in the past has shown or demonstrated great ability to persuade. But I think that this is a very clumsy attempt. Everyone can see through it. He's asking for the $15 million -- for the $14 million to be approved by the Congress, and then he promises that he will use it only for humanitarian purposes.

MacNEIL: Shortly before President Reagan briefed the press on the administration's new Nicaragua proposals, he met with Belisario Betancur, the president of Colombia. Betancur has been a key figure in Latin American efforts to work out a negotiated settlement in Central America. The Colombian president's diplomatic role continues with this new Reagan administration initiative. He's going to Managua when he leaves Washington to brief the Nicaraguan government on President Reagan's proposals. After he left the White House this afternoon, President Betancur granted an exclusive interview to correspondent Charles Krause.

CHARLES KRAUSE [voice-over]: The man President Reagan met at the White House today has played a pivotal role in the Contadora peace process. Under Betancur's leadership, Colombia, along with Venezuela, Mexico and Panama, has tried to negotiate an end to the differences that threaten regional war in Central America. Since his inauguration in 1982, Betancur has repeatedly warned against the dangers of U.S. military intervention. He's also expressed the view that poverty, not the Soviet Union, is the principal cause of revolution in Central America.

Betancur's popular at home because he's practiced what he's preached abroad. Last year Betancur negotiated a truce with Colombia's own guerrillas, at least temporarily ending 20 years of fighting. He hopes the truce will be a model for settling other conflicts in Latin America. Betancur's also pursued a vigorous war against Colombia's drug mafia. Since he became president, the army's destroyed hundreds of millions of dollars worth of cocaine and marijuana. But it's Contadora that's propelled Betancur onto the world stage. He keeps in close contact with Central American leaders on all sides. And now, after today's meeting with President Reagan, he will again use his Central American contacts in another bid for peace. We interviewed him shortly after his visit to the Oval Office.

[interviewing] Do you see the proposal as representing any change in the American position?

BELISARIO BETANCUR, President of Colombia [through interpreter]: Perhaps I am disappointing you, disillusioning you, but this proposal is being made by the United States and is received by the Sandinista government in Nicaragua. I can interpret neither the Sandinista government nor the United States government. What I feel is that this will provide them with time for meditation. And any time of meditation is necessarily constructive, creative, especially during these holy days of Easter.

KRAUSE: Do you think that if Congress passes the President's request for $14 million worth of aid to the contras, will that help the situation in Central America?

Pres. BETANCUR [through interpreter]: We preach peace, and consequently, we are not very fond of the stumbling blocks that could be found along the way to peace in Central America. You ask me about a specific point, about aid approved by the United States Congress. But I would merely approach that reality by mentioning the principles which guide our actions. Anything beyond those principles is something that we do not like in Contadora, regardless of the source of that disruption.

KRAUSE: Do you think that there is more to this proposal than simply a political move by the President to get Congress to pass aid for the contras?

Pres. BETANCUR [through interpreter]: I would not like to -- not to live up to the hospitality warmly offered to me by President Reagan in terms of giving an opinion about his behavior. I would rather that these resources be used for humanitarian purposes than for military purposes. And also allow me to say that, regardless of whatever the request for resources may be for, today's proposal, the proposal issued today by President Reagan, is within the framework of the document on objectives and the draft Contadora document.

KRAUSE: In your conversations with the President today, did you -- were there any indications of a greater flexibility on his part than may be contained in the actual proposals that you'll be taking with you to Managua?

Pres. BETANCUR [through interpreter]: Yes, there is a flexibility. We are now going to have a waiting period, what the philosophers would call -- in a metaphysical discussion, for example. We will suspend judgment. And I think that this is a time for reflection for us all, a time of creativity, for peace.

LEHRER: We go now to a spokesman for the democratic leadership in the U.S. House of Representatives, Congressman Tom Foley of the state of Washington, the majority whip of the House.

Congressman, what do you think of the Reagan plan?

Rep. TOM FOLEY: Well, I think it's basically the same issue, and that is whether support for a military attack on the Nicaraguan government, which we recognize diplomatically and with which we are technically at peace, achieves the objectives that we all share, which is peace in the region, nonintervention in other states, the development of democratic institutions. No question the Congress -- Democrats and Republicans -- all share the goals of peace, democratic institutions, economic development, nonintervention. The problem is that many in the Congress, both Democratic and Republican members, do not believe that an active military operation carried on by the contras against the Nicaraguan government is a way of achieving those goals. Now, what the President has proposed today is in fact to provide a call for a negotiation that's already been rejected by one side.

LEHRER: By the Sandinistas.

Rep. FOLEY: By the Sandinista government. They rejected it before today, as the President indicated; they rejected it again today. And secondly, to say that if it was accepted, that humanitarian aid alone would be used from this $14 million. Now, humanitarian aid can also be looked at as logistic aid for an armed force in the field: clothing, medical supplies, communications equipment -- nonlethal equipment. Then if the talks don't succeed, or if both parties don't ask that they continue, then it could be used for military aid. So in the real world, this proposal if accepted by Congress would lead almost certainly to the $14 million being applied to military purposes. And that's exactly what Congress has rejected four times, the House in particular, in the last two years. Not because we don't share the goals. Not because we don't seek peace and democratic institutions and the improvement of conditions in Nicaragua. I have no brief for the conditions in the Nicaraguan government. I'd like to see that government liberalized; I'd like to see better civil liberties; I'd like to see less militarization. But the problem is that many of us feel that the attack on the government, which we organized in effect, reorganized and supported, is giving the excuse to that regime to do exactly what we say we don't want: to invite foreign military advisors, to bring in foreign military equipment and supplies and assistance, to crack down in a certain sense on civil liberties.

LEHRER: So there is nothing new in the President's plan from your perspective?

Rep. FOLEY: Essentially, if you favor the use of military attack or pressure by military operations against Nicaragua as a method of achieving the goals that we share in common, then you should be for this proposal. If you do not feel that those are wise, and in fact, if you think they're counterproductive, as many of us in both parties do, then there is, in effect, the same issue.

LEHRER: House Speaker O'Neill called it a dirty trick.

Rep. FOLEY: I wouldn't say that. I think it's really a question of how we approach the use of military assistance to the contras and a military attack by the contras against Nicaragua, whether we regard that as helping our common, shared goals in Central and Latin America or not. We've had a lot of bipartisan support, on the Caribbean Basin Initiative, on El Salvador, on the assistance to that government, on building up the governments in Central and Latin America. Both parties have supported that. But there is a disagreement over an open support for so-called covert war against the government of Nicaragua. And it's just counterproductive -- a Washington word -- but it's counterproductive. It's not achieving any of its goals. It's not limiting their support for the insurgency in El Salvador. It's not making the country more democratic or its institutions more pluralistic. It's not stopping foreign military assistance. Indeed, the administration says that foreign military assistance is at a record level now, after three years of the contra activities. Indeed, the government of Nicaragua appeals to the international community that it has to have military assistance because it's being openly attacked by instrumentalities supported by the United States. It just isn't working; it's against our traditions; it's causing us trouble in having our case understood in other parts of the world; and it basically is eroding the principle the United States has stood for, that governments should be peacefully changed, not by military intervention and insurgency.

LEHRER: Thank you. Robin?

MacNEIL: Now to defend the administration position we have one of its leading Central American policymakers, Langhorne Motley. He's assistant secretary of state for inter-American affairs.

Mr. Secretary, you've heard the proposal in the last few minutes attacked by D'Escoto as a desperate move, grudgingly praised as flexibility by the president of Colombia, and now dismissed by one of the leading Democrats in the House. Is this a going proposal?

LANGHORNE MOTLEY: I think so. I think the first thing that we have to keep in mind is that there is a new element to it. That element is that the President of the United States has said that he will use those funds voted by Congress for humanitarian purposes in a breathing-spell period in which to try to achieve a peaceful solution through national reconciliation, that is, dialogue between the two factors in Nicaragua. We backed that in El Salvador. We saw President Betancur had done that kind of thing successfully. This whole proposal, this peace proposal, is an attempt to get this dialogue, a peaceful dialogue, going between two warring factions. That's the thrust of the President's initiative. What's new about it is that the President has stood up and said, "I will in fact use this for humanitarian." I don't agree totally with Congressman Foley because even guerrillas have a right to eat and sleep and have clothes while they're engaging in a dialogue for peace. The fact that it was rejected out of hand by D'Escoto I nd disappointing -- not unusual. But I will remind you that the Nicaraguans said at first that they were not going to release a Mr. Ulbina, a roadblock to the Contradora process, and after they looked at it they saw that it was in their best interests and it was reasonable. You may recall that the Russians were not going to come back to the bargaining table and yet they're meeting there now. This initial reaction on the part of D'Escoto I wouldn't take as a final word.

MacNEIL: What about President Betancur, one of the leading members, as we've heard, of the Contadora group? He said that he didn't wish to strain hospitality, and the best he could find to say for this was that it did demonstrate some flexibility. Wouldn't you have hoped for a rather more enthusiastic response?

Sec. MOTLEY: Well, I heard words like "constructive" and "creative," and at the press conference that followed your exclusive interview, they asked him how do you -- what was your reaction, and he said allegrea,which is the Spanish word for happiness. He of course has been in the forefront of this national reconciliation, this dialogue, as we saw in your little film clip. And so he recognizes that the central piece of this proposal is an attempt on the part of the President, a peace initiative, to give the system a chance to operate. It is a peaceful proposal trying to get these two to sit down at the table. I think we ought to take a good look at it.

MacNEIL: Of course, it affords the contras the status of recognition by the United States as a group which is justified in sitting down with an established government in Nicaragua.

Sec. MOTLEY: Well, we gave that same type of status to the guerrillas in El Salvador. I mean, President Reagan was on the front end of congratulating President Duarte when he said, "I will meet the guerrillas." You see, and here is the flip side. In El Salvador, a civilian-elected president that we have supported, four elections in three years, and he was the one who said, "I will sit down with the guerrillas," and they finally came to the table. In Nicaragua we had the exact flip. The, if you want to call them guerrillas, have said twice, "We will sit down," and the Nicaraguan government doesn't want to sit down. The moment of truth is coming. Are they really what they say about being democratic and peace loving? What is the fear of sitting down with these people and talking?

MacNEIL: Thank you. Jim?

LEHRER: Congressman, do you agree the moment of truth is coming for the Sandinistas as a result of this?

Rep. FOLEY: Well, I think the moment of truth would be closer if the United States were not supplying funds for, and were not proposing to supply funds, to carry on a military operation. I wouldn't even have as great an opposition to the use of humanitarian aid if it couldn't be converted into military aid. But the likelihood is very great that these talks will not in 60 days produce all the results that the United States hopes for them. In fact, as I heard the President today, he would virtually insist on a whole series of acceptances from Nicaragua, the Nicaraguan government, in order to call the talks successful. And then he's going to release the funds if they're not successful for military uses unless both sides, contra and Sandinistas, agree they should continue. What --

LEHRER: So what you're saying is that's just a gimmick to get military aid in?

Rep. FOLEY: Well, I don't want to call it a gimmick. I'm saying that in the real world, the likelihood is overwhelming that if this program were accepted by Congress, we're going to see these funds used for military purposes within 60 days.

LEHRER: Do you agree with that?

Sec. MOTLEY: No, I don't. And we have to a certain degree the congressman at a little bit of a disadvantage, because the President spent a lot of time, because people, including congressmen, said, you know, "Do something different." And the President has come forward with a peace proposal. He's looked at a lot of things. And he's looked at whether it should be 60 days or 45 days or 90 days. Sixty days is a good period of time in which to get negotiations off and running, to see in fact if -- if I can just finish -- to see in fact if there is something there. And he has said if both sides agree, then we'll continue under the same ground rules beyond 60 days. So it's flexible; it doesn't mean that at the end of 60 days it's going to be converted.

LEHRER: You do not agree then with the congressman that, sitting here tonight, the overwhelming evidence is that within 60 days that money would be used for military aid?

Sec. MOTLEY: I see no evidence, much less overwhelming, that that's the way it would flip. It's --

Rep. FOLEY: The contras themselves would have the opportunity at the end of 60 days to say that the talks were not productive and to say that they do not want the restrictions to continue. And under the President's plan, money would then flow for military purposes.

Sec. MOTLEY: Yeah, but who are the people that said, "We want to talk first"? And it was the Sandinistas that didn't.

LEHRER: But the congressman's right, the contras alone could say after 60 days, "We want the guns instead of the butter," and that's the end of it, right?

Sec. MOTLEY: The basic issue --

LEHRER: Is that right? Excuse me.

Sec. MOTLEY: -- is whether we think --

LEHRER: Is that right?

Sec. MOTLEY: The way you phrased it, I'm not so sure I'd phrase it. But in the interests of time, I'll agree with you that at the end of 60 days the talks could break off and they could --

LEHRER: But one side could do it.

Sec. MOTLEY: That's correct. We can't even get two sides sitting down. We're trying to get a peace proposal going. This is one step at a time, and you guys are worrying about what may happen 60 days from now.

Rep. FOLEY: Well, the basic problem is a disagreement not on the goals that the President says he wants and that I agree are desirable -- peace, stability, democratic institutions. The question is, does the American government support for a military attack supported by the United States against the Nicaraguan government bring us closer? We think that in the two and a half years in which the United States has been involved in this process, everything that has been counterproductive -- the government has been more militaristic in Nicaragua, defending itself on the basis that its being attacked by instrumentalities supported by the United States; more foreign aid has come in; there's no in-ormation that this has limited their assistance to El Salvador.

Sec. MOTLEY: I think the question is, what is in the national security interests of the United States? Let me tell you what the frameworks of the people is, as I understand it. They don't want a second Cuba on the mainland of what we live on, and they don't want a second Vietnam. And what you have in the Jackson plan, which is the rest of the country, which is the congressman says is working, and the support for the Sandinistas is within that framework. In other words, you don't have American troops bogged down protecting national interests, and you don't have a Marxist-Leninist regime whose exporting revolution. See, it's within that framework. That's the question.

LEHRER: But what about the question that the congressman raises as to whether or not giving military aid to the contras is the way to get that accomplished?

Sec. MOTLEY: Okay. Put that within the framework of you don't want a second Cuba, you don't want a second Vietnam, and look within the framework of our policy. That's the framework of the policy.

Rep. FOLEY: It doesn't work. The basic evidence of the last --

Sec. MOTLEY: It's working up to now.

Rep. FOLEY: -- few years is --

Sec. MOTLEY: Jackson's working. The Jackson plan's working.

Rep. FOLEY: No. It's not working in Nicaragua, because the administration itself says that this government, Nicaraguan government, has got more military aid coming in from outside than ever before. It is not going to overturn the Sandinista regime. General Gorman said that, and he was the administration's chief military advisor and director in that part of the country until a couple of months ago. All that we're doing is clouding our own position that government should be changed by political and by peaceful means, and putting ourselves against international law and opinion.

Sec. MOTLEY: He's almost leading --

Rep. FOLEY: It's not working.

Sec. MOTLEY: -- to a conclusion of American troops. He's breaking down the parameter of it's a second Cuba. And the President of the United States isn't ready to accept that. He's trying a peace proposal to keep it within the parameters.

Rep. FOLEY: There is an alternative that is not either Cuba --

Sec. MOTLEY: Not a second Vietnam.

Rep. FOLEY: We don't need to have a military intervention supported by the United States to avoid a Cuba or a Vietnam. This administration supported the Contadora process. We can go back and do that. If the President's initiative is to call for a ceasefire and only humanitarian aid, why don't we start with that and leave the question of transferring these funds to a later judgment? Why should we offer an opportunity for the administration to transfer these funds --

Sec. MOTLEY: What did Betancur say? He said that the peace proposal with regards to the national dialogue was within the framework of Contadora -- his own words. So it's moving parallel with it.

Rep. FOLEY: What I heard the distinguished president of Colombia say is that he was not endorsing the use of force. He would not do that and he did not do it.

Sec. MOTLEY: He also said it was constructive, creative, and he was happy about it.

LEHRER: Congressman Foley, yesterday the House minority leader, Bob Michel, said that the $14 million proposal was dead in the water. And he asked for a new idea; the President came with a new idea. Is it still dead in the water?

Rep. FOLEY: Essentially, this is the same question. The question is, should we provide military assistance to the contras? That's basically the same question.

LEHRER: So it's still dead in the water?

Rep. FOLEY: I think the House will reject providing military assistance to the contras next week, and I think it will do so because of a bipartisan opposition to this particular way of achieving common goals.

Sec. MOTLEY: We've got time to debate this thing, thankfully, over a period of time. I'll just say to Congressman Foley, voting no doesn't solve the problem. The President has laid out a peace proposal there. I think we ought to analyze it.

LEHRER: We have to go. Robin?

MacNEIL: Again, the major stories of this Thursday. President Reagan proposed a ceasefire in Nicaragua between the ruling Sandinistas and U.S.-backed contras. The Nicaraguan government dismissed the proposal as a political ploy. The White House reached a compromise budget agreement with Senate Republicans. The Pentagon charged one of its largest suppliers, General Dynamics, with overcharging the government by nearly a quarter of a billion dollars. And Treasury Secretary James Baker warned Congress that if it started a trade war with Japan, the U.S. might lose.

Good night, Jim.

LEHRER: Good night, Robin. We'll see you tomorrow night. I'm Jim Lehrer. Thank you and good night.