The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight: The news of this day; then the president's new budget proposal, with differing reactions from Senators Judd Gregg and Kent Conrad; an update report on peace progress between Israel and the Palestinians; a health unit look at ways to prevent deadly medical errors; and some thoughts from sports author John Feinstein about the varied meanings of the Super Bowl.

NEWS SUMMARY

JIM LEHRER: President Bush sent his 2006 budget to Congress today. It marked the opening of a major battle over federal priorities. The budget totaled more than $2.5 trillion, with a record deficit of $427 billion. Overall, it would boost spending for defense and homeland security, but cut scores of other programs. The president said it sets priorities in a fiscally responsible way. House Democratic leader Nancy Pelosi called it a "hoax" because the costs of Iraq and Social Security changes were not included. We'll have our full coverage of the story right after the News Summary. Israel and the Palestinians announced plans today for a formal cease-fire, to end four years of violence. Palestinian President Abbas and Israeli Prime Minister Sharon will formally declare the truce tomorrow at a summit in Egypt. An Israeli representative said it's the first step in getting back on track toward a peace agreement.

RAANAN GISSIN: Declarations in and by themselves are not sufficient but I think this time the declaration has substance behind it because I think both sides-- the Israelis and the Palestinians-- are very serious in an effort not to lose this opportunity and to move forward.

JIM LEHRER: The Palestinians said the deal also calls for joint committees to oversee Israeli pull-backs in the West Bank. The announcement came after U.S. Secretary of State Rice visited the region. She said President Abbas and Prime Minister Sharon will meet separately with President Bush in Washington. And she said the U.S. wants to seize the moment.

CONDOLEEZZA RICE: I'm here in my first ten or so days as secretary of state to demonstrate that commitment. Not everything has to involve the United States, but the United States has to be there when it is needed. We will be very active.

JIM LEHRER: We'll have more on this story later in the program. At least 28 people died in a series of attacks across Iraq today. In Baqouba, a car bomb killed at least 15 people outside a police building. In Mosul, a suicide bomber killed 12 policemen at a hospital compound. Another person died in a mortar attack in Mosul. And over the weekend, insurgents killed at least 21 Iraqis and three U.S. soldiers. A Kurdish coalition moved into second place today, in the vote count in Iraq. A Shiite alliance, backed by Grand Ayatollah al-Sistani, remained in first place with well over two million votes. The Kurdish grouping of two parties had more than one million votes and a bloc headed by Prime Minister Allawi was running third. Returns so far have indicated most Sunni Muslims did not vote. A final tally is expected Thursday. U.N. Secretary-General Annan today suspended two top officials involved in the oil- for-food program in Iraq. Last week, an independent report accused the program's former head of a "grave conflict of interest" in handling oil deals with Iraq. The report also said another official, in charge of awarding contracts, had tainted the process. The two men can appeal the suspensions. A jury in Massachusetts today convicted a key figure in the Catholic Church's sex abuse scandal. Defrocked priest Paul Shanley was found guilty in Cambridge of raping a boy in the 1980s. He showed no emotion as the verdict was read. The abuse began when the victim was six years old. He's now 27. Shanley is now 74. He faces a possible life sentence. On Wall Street today, the Dow Jones Industrial Average lost less than one point to close at 10,715. The NASDAQ fell four points to close at 2082. The city of Boston geared up for another victory parade today. This time it will be for the New England Patriots' victory in the Super Bowl. They beat the Philadelphia Eagles 24-21 on Sunday, in Jacksonville, Florida. It was New England's third NFL championship in four years and the second in a row. We'll have more on the Super Bowl at the end of the program tonight. And between now and then: the budget, Senators Gregg and Conrad, a Middle East update, and medical errors.

FOCUS - PRIORITIES AND PROGRAMS

JIM LEHRER: President Bush put a proposed budget on the public and congressional table today. Kwame Holman begins our coverage.

KWAME HOLMAN: Representing the House Budget Committee, Kansas Republican Jim Ryun was one of the first to receive a copy of the president's budget when they were delivered to the capitol early this morning.

SPOKESMAN: A lot of numbers, a lot of good reading.

KWAME HOLMAN: The nearly 2,500- page document lays out more than $2.5 trillion of federal spending for fiscal year 2006, and includes the first cut in basic domestic programs since Ronald Reagan was president. Meeting with his cabinet this morning, President Bush defended his budget.

PRESIDENT GEORGE W. BUSH: I fully understand that sometimes it's hard to eliminate a program that sounds good. But by getting people to focus on results and saying to members of Congress, "show us the results as to whether or not this program is working," I think we'll get a pretty good response.

KWAME HOLMAN: Presidents send their budgets to Congress early in February hoping to influence the final legislative decisions members will make by the start of the new fiscal year in October. And traditionally, members immediately rate the proposals anywhere from "a good starting point" to "dead on arrival." In that tradition, Senate Democratic leader Harry Reid today called the president's budget "the most irresponsible and misleading budget in our nation's history." And at his briefing this afternoon, the president's budget director Josh Bolten said recent history is on President Bush's side.

JOSH BOLTEN: I imagine that you all have already gotten some "dead on arrival" comments from folks on the Hill. The same thing was said last year. In the end, the Congress delivered the totals that the president sought. Now, a lot of the details are different and that is Congress's responsibility to make appropriations decisions, subject to the president's signature.

KWAME HOLMAN: The president's budget is a blueprint of how much he wants the government to spend, offset by how much revenue he expects it to collect. But because spending once again will far exceed revenues, the government will have to borrow hundreds of billions of dollars to make up the difference. The projected deficit this year alone is $427 billion. But Budget Director Bolten says if Congress follows the president's budget proposals, annual deficits could be cut in half by 2009, a promise made by the president during last week's state of the union address.

JOSH BOLTEN: It's never unanimously popular to propose any savings. The spending is in the budget for a reason, because somebody wanted it there. But in an era of limited resources, we need to set some priorities and I'm optimistic that we'll get some good cooperation from the Congress.

KWAME HOLMAN: While defense and homeland security are slated for large increases, the president's budget calls for eliminating or drastically scaling back some 150 federal programs. They include: Government support for farmers-- price supports would be reduced on a wide range of crops; federal grant programs for local schools, vocational education, anti-drug efforts and literacy programs would be cut back; Medicaid, which provides health care for the poor, would have its growth restrained; the Army Corps of Engineers, whose dam and waterway projects are extremely popular in Congress, would receive less funding than it did in 2005; and federal subsidies for Amtrak's operation would be eliminated. Today, Democrats said those cuts are the wrong way to reduce the deficit. John Spratt of South Carolina is the top Democrat on the House Budget Committee.

REP. JOHN SPRATT: They're real and they hurt and yet for all of the hurt these acts hardly move deficit at all. This is the irony of what they have proposed here as a budget solution. These programs have proved themselves and they have stood the test of time. Yet they're cutting them. We simply take it back to the American people and throw it to the Congress and say, "Is this really what you want to buy into?"

KWAME HOLMAN: Democrats also argue that the president's plan only achieves its deficit- reduction goals by leaving out big-ticket spending items, such as the cost of keeping troops in Iraq and Afghanistan, and paying for his top domestic priority, revamping Social Security. Budget Director Bolten.

JOSH BOLTEN: The budget went to bed a couple of weeks, two or three weeks ago and so before the president's proposals were announced. And the president's Social Security proposals are still in formulation, in a process of consultation with the Congress. We're just reflecting now for you what we do know about the immediate deficit effects of the personal account formulation that the president advertised. There's a lot more, though, to go to know what the real numbers are going out into the future.

KWAME HOLMAN: Also left out of the president's budget was the future cost of making Mr. Bush's first- term tax cuts permanent. Democrats today said those hidden costs will lead the nation further into debt. North Dakota's Kent Conrad:

SEN. KENT CONRAD: He is taking us to a future in which massive cuts will be required. There will be massive cuts. I'm predicting today massive cuts in Social Security, massive cuts in Medicare under this president's plan. He's going to take us right over the cliff into massive deficits and massive debt that will harm the American economy for a long time to come.

KWAME HOLMAN: Congress begins the process of examining the president's budget tomorrow, with hearings on both the House and Senate sides of the Capitol.

JIM LEHRER: Margaret Warner picks up the congressional debate over the new budget.

MARGARET WARNER: And for that I'm joined by the two Senate leaders who have primary responsibility for dealing with the budget in the months ahead. Sen. Judd Gregg of New Hampshire is the chairman of the Senate Budget Committee, and Sen. Kent Conrad of North Dakota is the committee's ranking Democrat. Welcome to you both. Sen. Gregg, you expressed great support for this budget today. You called it... you said the president should be congratulated. What do you like about it?

SEN. JUDD GREGG: Well, I like the fact that he's put forward a specific set of ideas for restraining the growth of spending, both on the discretionary side, and a large number of the entitlement accounts, whether it's agriculture or Medicaid. On the discretionary side, he's basically kept non-defense discretionary at a less than the rate of inflation growth. On the defense side, he's actually reduced the rate of growth of the base of defense. So it's a pretty aggressive statement of trying to institute some policies to discipline our fiscal house.

MARGARET WARNER: And Sen. Conrad, you were, to say the least, not very complimentary. What don't you like about it?

SEN. KENT CONRAD: I think this budget by the president takes us just one more step down the trail of record deficits and record debt, and debt and deficits that explode as the president's proposals get enacted. You know, he just left out a lot of things. When he says he's going to cut the deficit in half over the next five years, he left out war costs; there's no war costs past Sep. 30 of this year. He left out the trillions of dollars that his Social Security privatization plan will cost. He left out $700 billion needed to fix the alternative minimum cost.

MARGARET WARNER: Minimum tax.

SEN. KENT CONRAD: He just left out so many things. He left out making permanent the tax cuts that cost $1.7 trillion over the next ten years. You put all those things back together, and what you have is a pattern that takes us deeper and deeper into deficit and debt.

MARGARET WARNER: Sen. Gregg, what's your response to that -- because that's the criticism from the Democrats here, that there's so many big-ticket items that aren't included, how credible should the American people look upon these projections of cutting the deficit in half by 2009?

SEN. JUDD GREGG: Well, first off, they can look very much at what the president has proposed in specific spending restraint. And we'll look forward to our Democratic colleagues joining us in restraining those spending programs if they're interested in reducing the deficit. As to the specific issue of, for example, war costs, five years from now hopefully we won't be at war. In fact, I'm sure we won't be at war in Iran or Iraq -- or in Iraq or Afghanistan. And as a result, we shouldn't be building that number into the base, the war costs into the base. The revenues which the senator from North Dakota appears to want to increase by raising taxes, that's not the approach that we want to take. But if they believe they should raise taxes to reduce this deficit, then let them bring forward a budget that raises taxes, or let them bring forward a budget that promotes their

cuts.

MARGARET WARNER: But where -- if there are all these other costs that are known --that are known to be in fact incurred --

SEN. JUDD GREGG: Well, I don't accept...

MARGARET WARNER: You don't accept the $81 billion that the administration is about to command the Iraq War?

SEN. JUDD GREGG: I don't have any problem with stating that number, but I don't think you build it into the base, because five years from now, it's not going to be there. That number goes away. This is not a one-time item. It is going to be a two- or three-year item. Two or three years from now, I don't want to increase defense spending by the cost of that war, so that the defense base suddenly has $80 billion of extra funds in it after the war is over. And I think that would be a bad policy. You talked about reducing the deficit in half in four years. I think the president has put on the table legitimate numbers that move us in that direction rather aggressively. And I have heard from the other side nothing from their proposals to accomplish deficit reduction other than raising taxes. In my opinion, that wouldn't help the economy. It probably would slow revenue growth in many ways, as a result of the economy slowing down.

MARGARET WARNER: Sen. Conrad, what would be the Democrats' alternative?

SEN. KENT CONRAD: Well, first of all, I want to correct a couple of misimpressions. I've not advocated raising taxes. I have said revenue has to be part of the solution, and the first place we ought to look for revenue is the tax gap. That is the difference between what is owed and what is being paid. The Bush administration itself says that that gap was $300 billion in 2001. That's people who are getting away without paying what they owe, shoving the rest of the burden on to all the rest of us who do pay what we owe. That would be the first place I'd look. Second, they talk about spending restraint. Is there really spending restraint in this budget? The president's budget increases spending by 8 percent over last year. Now, they've put a lot of focus on the cuts. I understand that. But if you look at the overall budget, it increases spending 8 percent. At the same time, the president says cut the revenue $1.7 trillion, we already have record deficits. You know, when you increase spending and you cut revenue, and you can't pay your bills to begin with, there's only one possible outcome. That's more deficit, more debt, more borrowing, and a weaker America. That's the prescription in this president's plan.

MARGARET WARNER: Let me just ask Sen. Conrad --

SEN. JUDD GREGG: I would just like to just quickly respond on this -

MARGARET WARNER: Okay.

SEN. JUDD GREGG: -- on two points. First, the spending restraint is there, and we will see whether or not our colleagues on the other side of the aisle are willing to address it. The increases in spending which the senator mentions -- which are legitimate numbers -- go to fighting the war and Medicare primarily. Now, maybe they're willing to cut the efforts in defense and maybe they're willing to cut the efforts in Medicare, but I doubt it. Non-discretionary defense spending is kept below the rate of inflation. And there are proposals to reduce spending on the agriculture programs, which I doubt that the other side is going to be too excited about, and in other entitlements such as Medicaid. On the revenue side, let's remember, revenues are going up rather dramatically. Last year they increased by 9.2 percent. This year they're projected to increase by 6.5 percent. We're headed on a path to receive much more in the way of revenues as a result of the fact that we shallowed out this recession by putting a tax cut in place early on in the recession so that we didn't have a significant economic -- as significant an economic downturn as we might have had. So we're getting significant revenue growth, and putting a tax cut on top of this economy would be very counterproductive.

MARGARET WARNER: All right, Sen. Conrad, let me -- let's talk now about the actual cuts. And I take your point that the overall budget is growing, but there is an actual cut in this non-homeland security, non-defense part of the budget. Do you have a quarrel with those specific cuts, and if you don't, where else would you cut? I mean, if you do, where else would you cut?

SEN. KENT CONRAD: Yeah, there are priorities here that I think are badly misplaced. For example, I would not cut the cops program by 96 percent. Cops program has put 100,000 police officers on the street in this country. That's reduced crime. When we've got a terrorist threat, why ever would you reduce the number of police on the street? I wouldn't cut the firefighters by 30 percent. I wouldn't eliminate funding for vocational education. You know, not everybody goes to college. And to eliminate the education for those who are going to go into the trades I just think is short-sighted for this country. So there are cuts that don't make sense. There are other cuts, frankly, that I do support. I think we do need to go after states that are abusing and taking advantage of the Medicaid system. I would support limitations, payment limitations in agriculture, even though I come from a farm state. So there are places I would support the cuts. There are others that I think are very misplaced. But overall, remember, this is not a budget that cuts spending. It increases spending 8 percent, even though we already have record deficits. And then the president turns around and says, oh, by the way, cut the revenue base by nearly $2 trillion on top of it. There can only be one result. That's more deficits and more debt.

MARGARET WARNER: Going to the cuts, Sen. Gregg, a lot of these cuts -- I mean, there are others -- the ones Sen. Conrad named, and also things like increasing the cost to some veterans for the health care benefits they receive, eliminating Amtrak. All of these programs have powerful constituencies on Capitol Hill, including with your own fellow Republicans. How realistic is it that these cuts will get through?

SEN. JUDD GREGG: Well, first off, I want to congratulate Sen. Conrad if he's willing to address agriculture from North Dakota. I congratulate late him -- equally so in the Medicaid areas. I certainly hope we can reach agreement on those two areas. Well, my view is that last year we showed that we can discipline the budget on a discretionary side and on defense when we set a number of $822 billion. The Congress wanted to spend considerably more than that. The White House said no, and we ended up with $822 billion. If we can reach agreement on a top line number-- this year the White House is suggesting $840 billion-- and then let the Congress set its priorities within that number, there may be programs we'll support that the president doesn't support, and there may be programs he supports that we will support. Let us work out the details, but at least agree on a top line number that is enforceable by something called spending caps. And that's the way you make this work.

MARGARET WARNER: Is that doable, Sen. Conrad? Do you think you can agree on an overall number at least, and then let the appropriators decide where the cuts come?

SEN. KENT CONRAD: I would hope we could. And one thing where Sen. Gregg and I think are joined is on the spending disciplines; that is, restoring the old pay- go rules that say if you're going to increase spending or you're going to cut taxes, you've got to pay for it. And that's a discipline we badly need reenacted around here, and I'm hoping on a bipartisan basis we can do that.

MARGARET WARNER: Sen. Conrad, let me ask you this. If you look at -- whether it's the five-year part of this budget or the ten-year, we are now seeing deficits, as the old saying goes, "as far as the eye can see." Do you think we will ever get back to the point of balancing the federal books?

SEN. KENT CONRAD: It's critical that we do. The thing that I most fault the president on is that he has left the American people with the impression that he is reducing our fiscal imbalances. The fact is, he is not. He is dramatically increasing our deficit and debt in the long term. If you look just beyond this five-year budget window, all the things he's left out explode in cost. And that's going to put this country in very, very grave difficulty, given the fact it's right when the baby boomers begin to retire. It will force very, very deep and draconian cuts. That's a very important point.

MARGARET WARNER: Sen. Gregg, are we looking at eternal deficits? Is that really the message of this budget?

SEN. JUDD GREGG: No, not at all. What you're looking at is two different problems here. In the short term, we can certainly manage the deficit. We can reduce it by half, which will be an historic low, relative to the period that, we're over the last 20 years except for that period when we had surpluses. But the problem is the demographic situation that occurs in this country, which is, when the baby boom generation starts to retire in 2008, the demands of my population, of our generation here on younger Americans, our children and our grandchildren-- for our retirement benefits, for our health care costs-- are going to be absolutely astronomical. And there simply aren't going to be enough people working to support the retired generation, because the retired generation will be so large. That is a huge issue. The president has been willing to step up to that issue by taking on the question of how we reform Social Security. So I think you've got to give him credit for recognizing that the long-term structural issue, which is demographically driven-- we're all alive, we all exist, and most of us are going to retire and take advantage of the retire system -- is there, and you've got to address it. So his stepping out on the issue of Social Security is a very positive step in the right direction towards opening the debate on how we address the long-term deficit.

MARGARET WARNER: But Sen. Gregg, that does raise the question that none of the Social Security transition costs are even in this budget projection, even if we phase it in, as I think he's suggesting -- I think it's something like $750 billion or $780 billion by 2009 -- where does that come from? Where does this budget leave the prospects for the Social Security overhaul being passed this year?

SEN. JUDD GREGG: Well, Social Security has about five major moving parts, and if you address it in a comprehensive way, you'll put it into balance. And if you put it into balance, you'll save massive amounts of dollars in the out years -- something like $11 trillion. And part of that is the personal account approach. Part of it would be changing the bend points, which is basically means testing. Part of it would be getting a proper COLA. But you've to do a balanced, comprehensive approach. But once you do that, yes, you'll have some short-term increases in costs, because you've got to get to the corrections in the system that give you the long-term benefit. But over the long-term, you'll have huge savings and you'll make the system solvent, which is the key here for our children and our grandchildren, who are going to have to pay to support us, and we don't want to put too much of a tax burden on them to do that.

MARGARET WARNER: Sen. Conrad, I guess what I'm really asking is, do you think the Social Security reform is politically doable this year as the president would like to do, when at the same time the members of Congress and the Senate are looking at these deficits?

SEN. KENT CONRAD: You know, the president has made it all more difficult, first of all, by not acknowledging the privatization cost. The 20-year costs are $4.6 trillion, and he proposes borrowing all of it. That's not a solution to a problem. Second of all, in the short- term, the president over the next ten years is taking over $2.5 trillion of Social Security money and using it to pay for other things. That just digs the hole deeper before starting to fill it in. Now, this is a policy -- this is a policy not of reducing deficits and facing up to problems. This is a budget plan that hides problems from the American people and hides the result. The inevitable result will have put us in a very deep hole and weaken the country's economic strength. That's a mistake.

MARGARET WARNER: Sen. Conrad and Chairman Gregg, thank you both.

SEN. JUDD GREGG: Thank you.

JIM LEHRER: Still to come on the NewsHour tonight, more progress toward peace in the Middle East, preventing medical errors and why they call it the Super Bowl.

FOCUS- TIME OF HOPE

JIM LEHRER: Our Middle East update. Ray Suarez is in charge.

RAY SUAREZ: Israel's prime minister, Ariel Sharon, and Mahmoud Abbas, the newly-elected president of the Palestinian Authority, will declare an end to more than four years of fighting when they meet tomorrow in Sharm-el-sheikh, Egypt. Officials from both sides said the truce deal had been worked out in pre-summit talks. That announcement came as Secretary of state Condoleezza Rice wrapped up her first official visit to the area. Calling this a "moment of opportunity," Rice named a U.S. Army general to act as security coordinator between Palestinians and Israelis.

RAY SUAREZ: For more on these developments, we turn to Newsweek's Jerusalem correspondent, Dan Ephron.

Dan, welcome. Does Rice's visit, the new secretary of state, constitute an active return of the United States to Middle East diplomacy?

DAN EPHRON: Well, I think the Palestinians certainly hope that it does. And I think it probably does. It's a bigger sign than anything we've seen, I would say, in the past 18 months that the Americans are now willing to engage. If you recall, it was in September of 2003 when this very same Mahmoud Abbas stepped down as the Palestinian prime minister, and from that stage on, the Americans really washed their hands of this thing. There have been no regular envoys. And this is, I think, the first visit by a secretary of state from the United States since then.

RAY SUAREZ: What is Lt. Gen. William Ward, the new security coordinator, going to do?

DAN EPHRON: Well, I think that's one of the interesting things that has emerged from Secretary Rice's visit here. In the past, I think for the most part the United States has sent troubleshooters who deal with diplomacy, who deal with politics, who go back and forth between Jerusalem and Ramallah carrying messages and trying to bridge political issues. In this case, the U.S. has appointed a security coordinator who will probably remain primarily on the Palestinian side and help the Palestinians reconstitute their police force. I think what this says is that the United States is lining itself more or less up with what Israel has asked for, which is that this process, at least in the coming months, be much more security oriented than political; that is to say, that the first step is that Palestinians have to get their police force back in order, and not only come to a cease-fire with these groups, as apparently they have, but actually move ahead and start dismantling some of these militant groups.

RAY SUAREZ: Will Lt. Gen. Ward be welcomed more by one side than the other? Was this appointment something that Israelis or Palestinians wanted more than the other?

DAN EPHRON: It's hard to say. I don't think that the Palestinians will necessarily turn him away or be unwelcoming. I think it does say that what the Israelis wanted, the Israelis got. The Israelis have talked all along throughout this process since Yasser Arafat died that if there is going to be a resumption of some negotiation or a return to the road map, to that U.S.-backed peace plan, that it has to start with security measures. For the Israelis, that means getting Palestinians to deploy both in the West Bank and Gaza, to get their police force back in order, and getting them to fight these groups that have carried out much of the violence over the last four years. Mahmoud Abbas, the Palestinian president, has talked about a cease-fire. He's talked about co-opting these militants. I think what the Israelis want and what they're hoping this security coordinator from the United States will help achieve is actually something further, actually dismantling these groups.

RAY SUAREZ: Mahmoud Abbas is still pretty early in his tenure as president of the PA. Has he really gotten his arms around the security structure yet? Does he have the clout, the authority to hold up his end of the cease-fire?

DAN EPHRON: Well, I think those are two separate questions. I don't think he's gotten himself around the security structure. I think there are changes he talked about making during his campaign about consolidating, about renewing. But I think the matter of a mandate is something else. Mahmoud Abbas ran on a pledge to stop the intifada, and he was elected by a large majority. And I think in that respect, many Palestinians, including groups that are opposed to a cease-fire with Israel -- even Hamas, this Islamic group -- I think has some sense that this is the will of the people, that most Palestinians are tired of this violence,and that their voice has spoken in electing Mahmoud Abbas. And I think there's a tendency anyway to let that go forward for the time being.

RAY SUAREZ: That soon-to-be- announced cease-fire has gotten a lot of the attention, but what else is on the agenda for Sharm el-Sheikh? What else do the two sides have to talk about?

DAN EPHRON: Well, one of the interesting things... first of all, this has been carefully choreographed. I think that's in part true because there have been other summits-- certainly many summits between Israelis and Palestinians over the years, and even other summits during these four and a half years of violence. I think the two sides wanted to make sure that when they got there, they had all their t's crossed and their i's dotted. And I think in some respects they do. The language of this declaration of cease-fire has been laid out carefully. But I think another significant aspect of the summit is the fact that President Mubarak and King Abdullah of Egypt and Jordan are there, and they're there with Prime Minister Ariel Sharon, the Israeli leader, who was really a pariah in the Arab world for much of the past 20 years. I think in some respects this is the first time the Arab world, or part of the Arab world, is giving Ariel Sharon legitimacy.

RAY SUAREZ: Why isn't Secretary Rice going to the conference? She's been in the neighborhood. She's been holding news conferences, been photographed with heads of government. This would seem to be the logical next step, no?

DAN EPHRON: I think you're right on the face of things, but I think the United States has watched this thing happen over the last months, these contacts between Israelis and Palestinians -- really the first substantive contacts in a very long time -- without necessarily being involved. And I think for the United States, there's some advantage to letting Israelis and Palestinians work this thing through, inasmuch as the two sides are sitting down and talking about the right things. So inasmuch as that has happened over the last month, I think Secretary Rice and generally the Bush administration has been happy to let this thing go just between Israelis and Arabs. I think another issue is that this is really President Mubarak's show, Egyptian President's Mubarak's show. And I think there was a sense that if Secretary Rice was there, or someone else from the administration, that they would steal the limelight from President Mubarak.

RAY SUAREZ: Dan Ephron, from Newsweek Magazine, thanks for being with us.

DAN EPHRON: Thank you.

FOCUS - MEDICAL ERRORS

JIM LEHRER: Now, preventing medical errors before they lead to deadly consequences. Susan Dentzer of our health unit has a look at how one health care system is dealing with that problem. The unit is a partnership with Henry J. Kaiser Family Foundation.

DR. ROSS FLETCHER: Good morning, Mr. Hilliard. How are you doing?

SUSAN DENTZER: When Dr. Ross Fletcher visits patients here at the Washington, DC Veterans' Administration Hospital, he knows he should first cleanse his hands. A quick rub with an alcohol-foam disinfectant can help prevent the spread of costly bacterial infections. Those kill tens of thousands of hospital patients every year.

DR. ROSS FLETCHER: Take a deep breath.

SUSAN DENTZER: Most health care providers know they should follow the hand-cleansing procedure, but they don't always do it. Fletcher says the VA decided to change that.

DR. ROSS FLETCHER: When we first started this program, we noticed that about 40 percent of the time hand cleansing occurred satisfactorily. More recently it's been more well into the 80 percent range and we hope to get it close to 100 percent, so that any patient requiring hand cleansing will have that happen. What we've noticed in addition is that using the alcohol foam cleansing agent, we've been able to further reduce, over just simple hand washing, the incidence of very serious antibiotic resistant infections.

SUSAN DENTZER: The VA managed to double the rate of hand cleansing in the simplest of ways, for instance by putting disinfectant dispensers right here on the walls of patients' rooms. It's a small change that saves both money and lives, and it's just the sort of measure called for five years ago in this blockbuster report by the Institute of Medicine. Titled "to err is human," the 1999 report estimated that avoidable errors in U.S. hospitals were killing 44,000 to 98,000 Americans a year and injuring thousands more. The report said that was the equivalent of a jumbo jet crashing every day. One of the report's authors was Dr. Lucian Leape of the Harvard School of Public Health.

DR. LUCIAN LEAPE: The Institute of Medicine report in 1999 called for a national commitment, a moon shot, I mean, a serious national effort to reduce medical errors. We said we could reduce medical errors by 50 percent in five years if we had that kind of national commitment.

SUSAN DENTZER: But Leape and other safety experts say that national commitment failed to materialize.

DR. ROSS FLETCHER: There's been a bill before Congress every year for the last four years to provide protection, and we just don't seem to be able to get it passed.

SUSAN DENTZER: Reporter: Dr. Robert Wachter of the University of California at San Francisco co-authored a book on patient safety.

DR. ROBERT WACHTER: Everybody-- every doctor, everybody, every nurse, every hospital administrator-- knows we have a terrible problem and they really are desperate. I mean, just think about if a jumbo jet was crashing every day what we would be doing to solve that problem.

SUSAN DENTZER: If there's good news, say these safety experts, it's that despite the lack of national commitment, some health systems like the VA are taking steps to solve problems. Dr. Jonathan Perlin, who heads the VA health system, acknowledges that was not always the case.

DR. JONATHAN PERLIN: It's fair to say that historically, the VA's reputation was not... was not perfect and we realized we needed to change and what we saw was that we needed to improve safety, improve quality and improve the compassion with which we delivered care.

SUSAN DENTZER: So to lead its own moon shot against medical errors, the VA picked this man, physician and former astronaut James Bagian. Among other things, Bagian had helped to investigate space shuttle disasters at NASA. He thought aviation and aerospace had plenty to teach health care.

JAMES BAGIAN: An air-mail pilot back in the thirties had a life expectancy on the job of three to four years. And it wasn't until the '50s that aviation really started looking and saying, we can't just keep building more planes when we crash them.

SUSAN DENTZER: So aviation developed a so-called systems approach to improving safety. That includes an emphasis on teamwork and fixed procedures; those prevent airline crews from making mistakes, or to provide a backstop to thwart crashes in the event that errors occur.

JAMES BAGIAN: It was understanding, "we standardize." It's not like everybody has their own little way they want to fly the plane. We said, there are certain ways to do it; that we use checklists for certain things; that, you know, you take away certain latitudes.

SUSAN DENTZER: Bagian says applying systems-thinking to VA health care started with a similar cultural change. Rather than burying mistakes or punishing people involved in them, the VA had to ferret them out. Borrowing another leaf from airline safety, VA personnel are now required to report any adverse events through an internal computerized reporting system. They're also required to report so-called "near-misses" or "close calls"-- instances when something dangerous almost happens to patients but doesn't.

JAMES BAGIAN: Close calls happen anywhere from ten to 200 times more frequently than the event they're the precursor of. So you can think of for every incorrect surgery that's done, there's anywhere from ten to two hundred that almost happened. Why not learn from those?

SUSAN DENTZER: Bagian simulated for us how the reporting system works.

JAMES BAGIAN: Patient almost had surgery performed on the incorrect leg.

SUSAN DENTZER: VA safety experts analyze these reports and then launch a so-called root cause analysis. That's when a small team is assembled to probe the chain of factors leading up to a given adverse event. Take the problem Bagian simulated: Operating on the wrong site of the patient's body. It's surprisingly common throughout U.S. hospitals, especially when surgery involves a part that the body has two of, like eyes or kidneys. To avoid wrong-site surgery, a national hospital oversight body, the Joint Commission for Accreditation of Healthcare Organizations, now requires that the correct surgical site be clearly marked. But Bagian says that when VA performed root-cause analysis, it discovered an even bigger problem.

JAMES BAGIAN: We found that 44 percent of incorrect surgeries-- that's what we call them; we don't call them wrong-sited, because that's not right-- 44 percent were left/right foul-ups; 36 percent were the wrong patient. The reason they did the wrong knee was they thought I was you.

SUSAN DENTZER: The solution was to adopt a protocol in which each patient to be operated on first identifies himself by name, birth date and Social Security number.

PATIENT: William Dreyer.

HEALTH CARE WORKER: Okay, and your birth date?

PATIENT: Feb. 10, 1947.

HEALTH CARE WORKER: Okay, and your Social Security number?

SUSAN DENTZER: We watched the process take place before a real-life surgery at the Washington, DC Veterans' Medical Center. Bagian says that when these procedures have been followed at VA, they've drastically reduced wrong-site or wrong- person surgery. Another change from the past is that the VA now relies heavily on information technology to thwart errors, especially those involving medication. Studies suggest those turn up in roughly one out of every six hospital stays throughout the U.S. As a result, the VA has shifted to an almost fully computerized medication system. Physicians first select the name of the drug they want to prescribe, and the correct dose, from a computerized menu. That prevents any mistakes stemming from doctors' often unreadable handwriting. The physician can then check the prescription against the patient's fully electronic health record to probe any concerns about allergies or adverse drug interactions. The VA is the first large health system in the nation to replace paper charts with this fully-electronic record. The VA spent more than a billion dollars developing the record, but it now costs just $78 per patient per year to operate, and Perlin says it produces a huge safety payoff.

DR. JONATHAN PERLIN: If you came for care in VA eight years ago, the likelihood that your chart would be there would be 60 percent. Today, it's 100 percent.

SUSAN DENTZER: Once a prescription order is checked against the electronic health record, it's routed to the hospital pharmacy, where medication is labeled with the patient's name and a unique barcode. That's an innovation dreamed up by a VA nurse, who saw the bar coding technology in use at a car rental agency and suggested it could be adapted by the VA

DR. JONATHAN PERLIN: The nurse scans the barcode on the medication, scans the bar code on the patient's wrist band, assuring that it's the right medication in the right dose for the right patient, and virtually eliminating errors at that point of administration.

SUSAN DENTZER: On the day we visited the Washington VA, Inpatient Charles Hilliard was getting his medicine for leukemia.

CHARLES HILLARD: There was two Hilliards on this floor, so I definitely don't want to get his medicines, and I imagine he didn't want to get mine either!

SUSAN DENTZER: The VA now plans to add bar coding technology to lab work to prevent mix ups in which one patient's specimens are confused with another's.

With the exception of the costly step of converting to electronic health records, most of these changes have come cheaply. They amount to ten cents for every $100 the VA spends on delivering medical care. A new report from the government accountability office, Congress's watchdog arm, gives the VA generally high marks for its safety initiatives. At the same time, the report urges even broader cultural changes. Among other things, it said, "Nurses need the confidence to disagree with physicians when they find an unsafe situation." VA officials agree and say they've already launched training programs to encourage nurses to do just that. They say that's just one way they're aiming for still higher levels of patient safety and setting a standard for other U.S. health care providers to follow.

FOCUS - PATRIOTIC SPECTACLE

JIM LEHRER: And finally tonight, another Super Bowl is history. Media correspondent Terence Smith looks at this uniquely American spectacle.

ANNOUNCER: First down from the 19 -- McNabb goes toward the end zone. This one is picked off.

TERENCE SMITH: It was a rarity among Super Bowls-- a closely-fought game tied after the first, second and third quarters.

ANNOUNCER: Touchdown, Philadelphia!

TERENCE SMITH: After Philadelphia fell behind by ten in the fourth, receiver Greg Lewis caught a touchdown pass with 1:48 left to shave New England's lead to three. But the Patriots intercepted a Donovan McNabb pass with seconds to go and earned their third title in four years, leading many sportswriters to brand the Patriots the league's new dynasty. The Patriots became one of only two teams since the 1990s to win three titles in four seasons. An estimated 86 million people across the United States watched the televised game according to Neilson Media Research and as important to some viewers as the contest on the field, the half-time show, and the ads. Former Beatle Paul McCartney's halftime performance was deliberately devoid of scandal, unlike last year's spectacle when Janet Jackson flashed her bare breast-- the now infamous "wardrobe malfunction"-- when singer Justin Timberlake tore open her black leather top. That fleeting moment provoked outrage from the NFL To the Federal Communications Commission to Congress.

COMMERCIAL: Hey there's some Bud Light.

TERENCE SMITH: This year, advertisers paid an average of $2.4 million to air 30-second spots that specially produced for the game. The raciest ad mocked the Janet Jackson moment by showing an attractive woman suffering a wardrobe malfunction of her own in a Senate hearing about decency over the airwaves. But overall, the ads, the half- time show and the game itself were decidedly family-friendly.

TERENCE SMITH: More now about the Patriots and the tone behind this year's Super Bowl. For that I'm joined by author and sportswriter John Feinstein. He is at work on a book about the Baltimore Ravens.

John, welcome. Just good, clean fun this year.

JOHN FEINSTEIN: That's what the NFL wants. Paul Tagliabue wants a G-rated league, at least on the surface of it because what he says is, you know, we were shocked and outraged by the Janet Jackson moment last year. You remember the Monday night broadcast that opened with Nicolette Sheridan in a towel in the Philadelphia Eagles' locker room with Terrell Owens. When people objected to that Tagliabue again did his Inspector No imitation, and said I'm shocked to learn that there are towels in the Philadelphia Eagles' locker room occupied by women. They go on and on about how they want to be good, clean fun as you say. But look at any NFL game on the sidelines; you have cheerleaders wearing almost nothing. The teams put out calendars with these cheerleaders and Paul Tagliabue doesn't seem to be too upset about that because it sells.

TERENCE SMITH: But for the Super Bowl, for this huge audience 86 million people different rules apply.

JOHN FEINSTEIN: After last year. Different rules apply because what the NFL had done was the half times had gotten a little bit racier each and every year. One year it was Diana Ross being picked up by a helicopter and being taken out of the stadium at half tile. They turned the show over the MTV. Last year we saw what happened with Justin Timberlake and Janet Jackson and all the reaction and the FCC fining CBS hundreds of thousands of dollars for the incident and then the NFL saying, okay, we're not going to have that anymore so Paul McCartney is brought in. I'm sure if he had wanted to sing "Why Don't We Do it in the Road" that would have been banned by the NFL from the half time show.

TERENCE SMITH: Even the advertisers were on their best behavior. There was a little raciness there as we just showed.

JOHN FEINSTEIN: But that got pulled. That ad was pulled. It was supposed to air again at the two-minute warning. The NFL sent word to Fox that one goes too far. It was pulled. There was an ad involving Mickey Rooney that was screened before the Super Bowl in which his bottom was bared for two seconds. Fox well aware of the FCC big brother looking over its shoulder as it has done, as it did under Michael Powell, saying, oh, no, we can't air that. It wasn't that the advertisers necessarily wanted to tone down. They had no choice but to tone down. I think you call it censorship.

TERENCE SMITH: There's a little suggestion that people, organizations, networks, the NFL are perhaps having or trying to have it anyway both ways.

JOHN FEINSTEIN: Oh, absolutely. They want to have it both ways. When you go to an NFL stadium, Terry, you look around. There is a sign for the foundation of every player on the team. The Terence Smith Foundation, the John Feinstein Foundation; if you pick up a media guide it's about all the time these football players spend away from the field helping kids, helping the needy. That's the image the NFL portrays. The United Way commercials that have run for years with the players standing there going in my free time I go and I help these people who are in need. That's the image the NFL wants but they also know, they're smart enough to know that sex sells. So when they can get away with it, with cheerleaders rah-rah but we're wearing almost nothing they do that too.

TERENCE SMITH: Now, in fact they got a huge audience, 86 million people, but interestingly that was down 4 percent from a year ago.

JOHN FEINSTEIN: You wonder if that's just a blip, if it's a reflection of the fact that the weather was pretty good on the East Coast and people were out late in the afternoon. The ratings go up as the game goes on. Maybe people are a little tired of the Patriots. You never know with dynasties. They can go both ways. The Patriots aren't a sexy dynasty the way the Cowboys were. The cowboys were rock 'em, sock 'em, they were America's team. They had the sexy cheerleaders that everybody knew all about because they were the first ones to have them. They got big ratings. The Patriots are a very quiet dynasty, embodied in their coach Bill Belichick who would rather wear a gray sweat shirt 24/7 throughout the year.

TERENCE SMITH: Dynasty, what does it mean? That's today's word.

JOHN FEINSTEIN: It's a relative word in anything. In sports, politics, whatever you want to talk about. But in today's NFL, where you have this salary cap that makes it very difficult to keep teams together for extended periods because players become stars and then their salaries go up and teams have to make a decision, we can pay this star but we can't pay that star. So it's very hard to maintain year after year the way in the old days when players were tied to their teams forever, you know, the old Green Bay Packers of Vince Lombardi, most of those guys stayed with the Packers for their entire careers. I doesn't work that way anymore in the NFL. So to win three Super Bowls in four years in today's environment is remarkable and is, quote unquote, a dynasty.

TERENCE SMITH: Yet they have figured out how to do it. What's the key?

JOHN FEINSTEIN: Well I think the key for the Patriots -

TERENCE SMITH: That's what I mean.

JOHN FEINSTEIN: -- is they are not built around super stars. Their one true super star, the one guy on this team who is a lock Hall of Famer is their quarterback Tom Brady. They took him with 199th pick in the NFL draft in the sixth round. Not the number one like Peyton Manning of the Colts or Troy Aikman who was the quarterback for the last dynasty for the Cowboys. He was the 199th pick. So there's some luck involved when you get a super star in the sixth round but what they have done is they have built with mid- level free agents, guys who don't make 12, 14, 15 million dollars a year. There's a saying around the NFL the Washington Redskins win the Super Bowl every March because they march in all these big money free agents hold up a jersey gave them the huge contracts. When they have to put the team on the field in September it doesn't go so well. The Patriots don't hold any of those press conferences in March. Their signings are in agate. They sign so-and-so off of a team for, you know, for $2 million a year which in relative terms is a small contract. Then you look up in January and they're playing and the Redskins are watching at home along with most other teams.

TERENCE SMITH: If that's the formula why couldn't other teams do it? Why don't other teams do it?

JOHN FEINSTEIN: Well, other teams are copying it now because they're seeing how it works. You will see, you have seen in the last couple of years more and more teams looking for those mid-level free agents to fill out around their stars. But it's easier said than done. You have to have great scouts. The Patriots have a great front office led by Scott Pioli, a man who has been with Bill Belichick the coach since the cradle essentially and who Belichick has kept there. There are a lot of teams that would like to hire Scott Pioli as their general manager and Belichick said, no, no, you're not going anywhere; I'm going to pay you more but you're staying with me. So that's part of the secret. The other part is Belichick. The guy learned from his failures. The smartest people learn from their failures. He was a failure in Cleveland. He missed the play-offs four years out of five, he got fired. He learned from that.

TERENCE SMITH: John Feinstein, thanks so much.

JOHN FEINSTEIN: Thank you, Terry.

RECAP

JIM LEHRER: Again, the other major developments of this day: President Bush sent a $2.5 trillion budget to Congress. Democratic leaders called it a hoax. Israel and the Palestinians announced plans for a formal cease-fire. And at least 28 people died in attacks across Iraq. We'll see you online and again here tomorrow evening. I'm Jim Lehrer. Thank you and good night.