The NewsHour with Jim Lehrer

GWEN IFILL: Good evening. I'm Gwen Ifill. Jim Lehrer is on vacation. On the NewsHour tonight: A summary of today's news; then, the war of words between the Bush administration and its critics over Iraq policy; a Paul Solman report on two friends with contrasting views of the stock market; a court ruling against the government's post- 9/11 legal tactics; and an encore look at vanishing verbs in broadcast news.

NEWS SUMMARY

GWEN IFILL: Several key Arab nations today repeated their opposition to any U.S. attack on Iraq. In Egypt, President Mubarak warned such a war would cause chaos in the Middle East. In Baghdad, the foreign minister of Qatar said he was on mission to stop a "catastrophe," and in Washington, an adviser to the Saudi royal family said the answer is weapons inspections, not war. The comments came as President Bush discussed Iraq, and other matters, with the Saudi ambassador in Texas. A White House spokesman summarized the meeting.

ARI FLEISCHER: The President stressed that he has made no decisions, and he will continue to engage in consultations with Saudi Arabia and other nations about steps in the Middle East, steps in Iraq, and the President made very clear again that he believes that Saddam Hussein is a menace to world peace, a menace to regional peace, and that the world and region will be safer and better off without Saddam Hussein.

GWEN IFILL: In a diplomatic offensive, Iraqi officials today went to Syria and China, two of Iraq's strongest allies, to build opposition to American plans. And in Damascus, the Iraqi Vice President dismissed American threats of war. Inside Iraq today, American and British warplanes struck radar and air defenses in the no-fly zones over the north and south. U.S. military officials said the planes were on patrol when they were targeted from the ground. On Sunday, the associated press reports, U.S. And British jets blew up a major surveillance site in the south. It was used to monitor American troops in the Persian Gulf. We'll have more on Iraq in just a moment. The Bush administration wants broad powers to keep the Presidential pardon process secret. White House lawyers are contesting a lawsuit brought by Judicial Watch, a spokesman said today. The watchdog group is trying to get documents on President Clinton's last-day pardons. A Bush spokesman said the right of all Presidents to receive confidential information must be protected. The federal budget will run deficits for the next four years. The nonpartisan Congressional Budget Office projected that today. The CBO said the budget will return to large surpluses again only if Congress holds down spending, and only if the trillion-dollar tax cut enacted last year expires in 2010, as scheduled. Mixed reports on the U.S. economy today. The Conference Board, a private research group, said consumer confidence fell for the third straight month in August, to its lowest level since last November. But separately, the Commerce Department reported orders for durable goods, including cars and computers, jumped 8.7% in July. That was the largest increase in nine months. That's it for the News Summary tonight. Now it's on to a war of words over Iraq, the yin and yang of Wall Street, liberty versus security in court, and TV's vanishing verbs.

FOCUS WAR OF WORDS

GWEN IFILL: The latest round in the Iraq debate. The Bush administration responds to its critics.

Vice President Cheney's speech to a veterans group yesterday was in effect a point-by-point rebuttal to some of the Bush administration's harshest critics. Over the past few weeks, several republican leaders, including men who served under the first President Bush, have raised a series of red flags about a potential U.S. invasion of Iraq. Former Secretary of State James Baker, writing in the "New York Times," warned against unilateral action. He wrote: The costs in all areas will be much greater, as will the political risks, both domestic and international, if we end up going it alone or with only one or two other countries.

Cheney's response yesterday:

VICE PRESIDENT CHENEY: The risks of inaction are far greater than the risk of action. Now and in the future, the United States will work closely with the global coalition to deny terrorists and their state sponsors the materials, technology, and expertise to make and deliver weapons of mass destruction. We will develop and deploy effective missile defenses to protect America and our allies from sudden attack. And the entire world must know that we will take whatever action is necessary to defend our freedom and our security.

GWEN IFILL: Brent Scowcroft, former National Security Adviser to Presidents Ford and the first President Bush, said the timing may not be not right. An attack on Iraq at this time would seriously jeopardize, if not destroy, the global counterterrorist campaign we have undertaken, he wrote in the Wall Street Journal. Such an attack, he said, would run the risk of unleashing an Armageddon in the Middle East. Mr. Cheney's rebuttal:

VICE PRESIDENT CHENEY: What we must not do in the face of a mortal threat is to give in to wishful thinking or willful blindness.

As President Bush has said, "time is not on our side." Deliverable weapons of mass destruction in the hands of a terror network or a murderous dictator or the two working together constitutes as grave a threat as can be imagined.

GWEN IFILL: And former Secretary of State Henry Kissinger, although generally supportive of the President's position, has warned that the U.S. should think through to the endgame.

HENRY KISSINGER: Before undertaking this operation, the administration will want to think through what the political objective is, how the governance of these various ethnic groups can be accomplished, and how the reconstruction can be carried out. This is something about some general ideas must be formed so that there isn't a huge domestic debate in the middle... in the middle of a crisis.

GWEN IFILL: The Vice President had an answer to that too.

VICE PRESIDENT CHENEY: Our goal would be an Iraq that has territorial integrity, a government that is democratic and pluralistic, a nation where the human rights of every ethnic and religious group are recognized and protected. In that troubled land, all who seek justice and dignity and the chance to live their own lives, to know they have a friend and ally in the United States of America.

GWEN IFILL: While the debate continues, the President's legal counsel has already advised him he can launch an attack without congressional approval. But administration officials said they still plan to consult with, if not seek permission from, Congress. Today at his Texas ranch, the President met with Saudi Ambassador Prince Bandar. The Saudis provided critical basing rights and support during the 1991 Gulf War, but now oppose the new effort

GWEN IFILL: Now for a reaction to Vice President Cheney's speech and the growing debate, we are joined by William Hyland. He was deputy national security advisor during the Ford Administration, and editor of the journal Foreign Affairs" during the 1980s and early 1990s; Ellen Laipson, the president of the Stimson Center, a Washington research organization, which studies international peace and security issues. From 1993 to 1995, she was the director of near eastern and south Asian affairs on the National Security Council. Welcome to you both.

Let's walk through Mr. Cheney's arguments yesterday. It was a fairly detailed case for U.S. war against Iraq. Let's talk about one thing at a time. One thing he said, he asserted that Saddam Hussein, Mr. Hyland, possesses weapons of mass destruction. Is there proof of that?

WILLIAM HYLAND: Well, I think as far as gas, chemicals, there's a lot of proof of that. He's had them for a long time, they were discovered during the inspection, back in the 90s after the war. The real question is the nuclear, does he have nuclear weapons. Cheney came very close to saying he does. And there was, of course, evidence over the years that he did. His son-in-law, who defected, said that he had a nuclear program, he went back and he was murdered by Saddam. So I think the administration has a pretty good record, but they haven't put out all of the evidence, and some of it may be based on rather sensitive intelligence. But sooner or later they'll probably have to put it out.

GWEN IFILL: Ms. Laipson, he did come awfully close to suggesting that Saddam Hussein possesses some sort of nuclear capability. Is that enough?

ELLEN LAIPSON: Well, I thought one of his arguments actually was that we don't really have the luxury of waiting to know for sure whether he has nuclear weapons or not. If we were to wait till the day after we were 100% sure, then the initiative would be on Saddam's side and that he would have the ability to deter us and our allies from taking action. So I think part of the premise of the Bush Administration's logic of preemption is that you may not be able to wait until you're 100% satisfied. The administration seems to be saying they are satisfied, but the intention is there.

GWEN IFILL: But is that good enough?

ELLEN LAIPSON: To go to war with Iraq? I think we are not yet convinced that the American public believes that there's an imminent threat to the United States. One thing that I thaw was implicit in Vice President Cheney's speech was that the reasons to do this go beyond just American interests, it was a little bit about American leadership that we may have to do things occasionally that are for the interest of the world not just for the immediate interest of the United States. I don't think the speech gave very much to think about in terms of why Saddam is a threat to us and our way of life.

GWEN IFILL: Well, let's talk about that. Another point that the Vice President made in his speech was that he stated pretty flat out that there was a connection between terrorists and Iraq, and Saddam Hussein. Donald Rumsfeld has said of course there's al-Qaida in Iraq. Do you think the case has been made?

WILLIAM HYLAND: No, they haven't made the case in terms of al-Qaida, although they're beginning to. I think they discovered some al-Qaida cells up in northern Iraq. But they're making the case that if, as Ellen said, if we wait and he displays some nuclear weapons, then the entire Middle East is under his thumb -- not just Israel, but other Arab countries. So I think that's why Cheney made the speech today, because of all of the debating in the press by former officials who are saying let's wait, let's go to the Security Council. The President probably wanted to get someone at a high level out there saying we can't wait, because if we wait until the day we discover that he has nuclear warheads for those scud missiles, then we're going to be in very deep trouble.

GWEN IFILL: So this turns on timing. He's saying it's important to do it now and we'll find the evidence later, is that a correct reading?

ELLEN LAIPSON: I think that that's absolutely right. I think that we want the time to be of our choosing, not of his choosing. On the other hand, the thing that's a little bit irreconcilable is the time it will take to do all the consultations, that the President and the Vice President have talked about, making sure that our allies have been consulted making sure the countries in the region are on board, which as you pointed out earlier, they re not. That does take time. So I think the administration must be struggling with how to get this done on a timetable that's of their choosing and yet still feel that they've done all the necessary consultations.

GWEN IFILL: Also as part of the timing former Secretary of State Baker was talking about the notion that the UN Security Council should be involved in this. Is that something --

WILLIAM HYLAND: Cheney more or less put that to rest by saying that's just the way for Saddam to gain time, that will fit into endless debates and so forth, Security Council resolutions will be watered down. Then we'll re-abide by them and so forth. I think that Cheney was in effect saying the only consultation that really matters at this point is with the Congress, because of people like Tom DeLay, who are saying you better come up here, and Henry Hyde also, to Republicans saying you better come up here before you go to war. So I think that's important and that Cheney was more or less saying if we get diverted into the Security Council or if we get diverted into an inspection regime, as some countries want, we'll just be wasting time.

GWEN IFILL: Let's talk about the inspection regime. Is it not worth it any more to negotiate a new inspection regime with Iraq, have they shown such bad faith all along that we should just be moving ahead?

ELLEN LAIPSON: I think the consensus is emerging that that's the case -- that the Iraqis have even in this latest round indicated less than full willingness to comply even when certain UN officials have tried to help them and coax them along to a position that all sides would be comfortable with. I think the professional inspectors are also quite wary of going back in, do not want to seen as having been manipulated or duped by Saddam. So I think across the board people are growing a little more skeptical and resigned to the fact that the inspection served their purposes in the early 90s. It's very hard to resurrect an inspections regime that would have the vigor and the credibility that the inspections had early in the 90s. The administration has also, I think, evolved in its own thinking, I think as recently as perhaps six months ago they were willing to do some of this, perhaps theater at the UN Security Council, and my sense is there's diminishing patience for that kind of an approach.

WILLIAM HYLAND: I think so. But we shouldn't discount the shrewdness of Saddam Hussein. He's no fool, and he knows that if he makes enough right moves at the right time that the United States does not have a solid coalition. So if he may try to maneuver and suggest a new regime of inspection, or he invited someone there the other day and he sent someone off to China and Syria and so forth. So I think Cheney was trying to preempt, not the war, preempt diplomatically that Saddam would begin this kind of maneuvering to say well, come and look, you can come here, and interesting in the speech, Cheney cited historical anecdotes where in 1995 we thought that we had gotten all of his biological and so forth, and then suddenly his son-in-law defected and led us to a huge cache of unknown weapons and so forth. So I think Cheney is trying to say watch out. You think inspectors will go in there like Jim Baker is saying, they won't be any good.

GWEN IFILL: Without taking into account today's developments, without Egypt, without Saudi Arabia willing to give us basing rights or flyover rights to launch this attack, without other Gulf nations like Qatar and others, all are being very outspoken in their objections to this plan -- how does the United States, aside from winning public opinion over domestic -- win public opinion over internationally with allies in that region?

ELLEN LAIPSON: My sense is the Europeans, it's, we're further along in a reaching some level of agreement with them. I think the Europeans have come to the view that Saddam is a menace to the stability of the region. The hard part is to pursue a pro-active Iraq strategy at the same time that the Arab-Israeli arena is still in a lot of turmoil. The Arab states I think have demonstrated that they're clearly not comfortable today. It is my impression that if you can have more quiet and discreet conversations with them, that would somehow give them a higher level of confidence that we'll stay engaged and that we have the intention of bringing Iraq back in and making Iraq a more integrated country in the region, that perhaps slowly but surely we'll persuade them, given the mood and the expression of concern that some of the Arab states have, though, I don know if we have the time to do all of that, that hard work that needs to be done.

GWEN IFILL: Well, that's the question. If you don't have the time to seek UN Security Council approval, if you don't have the time to seek some other congressional approvals, but you do have the time to try to nurse your Arab allies along, does that fit with the plan that Vice President Cheney seemed to be laying out yesterday?

WILLIAM HYLAND: I don't think so. I think he was laying out a scheme or a plan, strategy, that said we can't spend too much time on this -- that if we waste time, we strengthen Saddam, and if you argue that, well, let's wait until we have absolute proof, then he is so strong that you may not be able to act at all. So I suspect the mind set of this administration is if we have to go it alone, we'll go it alone. We shouldn't be too troubled by Arab allies, or even European allies since they are not likely to come on board anyway.

GWEN IFILL: Is that the only option here?

ELLEN LAIPSON: Well, I think the other risk that the administration may be willing to take is that even if the Arabs may not be on board initially, if we succeed, then they'll be on board. But just to get to your question, I think there may be some expectation that we are exhausting all of the nonmilitary options before we go to a full scale war. It's possible that some of the other options that are available, working much more actively with various opposition groups, including paramilitary support to them, a more concerted political cultural economic strategy, maybe we'd show our intentions.

GWEN IFILL: Well, I guess that's the next question, which is whether, to answer Henry Kissinger's question about seeing what happens after an invasion, does it sound like, from what Vice President Cheney outlined yesterday, that enough thought has been given to what happens next, or that enough thought has been given to what happens first, which is fomenting opposition within Iraq?

WILLIAM HYLAND: I think maybe they haven t thought that the administration has not thought through what happens if you win. Suppose you defeat the Iraqi military, which is likely, and Saddam disappears somehow, then who governs Iraq -- people from London, people from some other faction -- the military -- former officials? I think, and you keep the country as an integrated unit because the Kurds who live in the north of Iraq could easily say this is our chance, let's go for independence. It's pretty hard to imagine the United States fighting against the Kurds, who have been our friends, supposedly, up until this date. But I think the administration probably is focused on first things first, is if we go to war, how do we do it. Do we go to the Congress, and get their support, and then what kind of military plan. I haven't heard much about a military plan that sounds effective.

GWEN IFILL: Have you heard anything that sounds effective?

ELLEN LAIPSON: No, and I think that the administration is talking about we want Iraq the day after to be democratic, I think that's a bit of a leap into the future. The opposition folks that we talked to keep insisting that Iraqis are so ready to shed the dictatorship and will embrace democracy, but I think we have to prepare ourselves for a period of some uncertainty. The one piece of the military story that may be is worth a little bit of attention is an expectation on the part of some Iraqis that we would militarily occupy the country until they're ready to take it over themselves.

GWEN IFILL: Okay, Ellen Laipson and William Hyland, thank you both for joining us.

WILLIAM HYLAND: Thank you.

FOCUS WALL STREET S YIN & YANG

GWEN IFILL: Still to come on the NewsHour tonight: The yin and yang of Wall Street, a post-9/11 court ruling, and the case of the vanishing verb.

Our business correspondent Paul Solman of WGBH-Boston spent some summer hours at an Oceanside amusement park recently, and came back with this tale.

PAUL SOLMAN: Economist Jeremy Siegel, whizzing around the go- kart track on the boardwalk of Ocean City, New Jersey. Fellow economist Robert Shiller, however, can't seem to put his pedal to the metal.

ROBERT SHILLER: I can't explain it. You know, at some point I just slam on the brakes.

PAUL SOLMAN: Really?

ROBERT SHILLER: Well...

PAUL SOLMAN: You hit the brakes on this?

ROBERT SHILLER: But see, I'm too cautious to just go right into this for the first time and floor it all the way.

PAUL SOLMAN: Yeah, of course you floor it all the way. We're only going like 15 miles an hour.

ROBERT SHILLER: Well, it's my personality.

PAUL SOLMAN: Fittingly perhaps, Shiller is the author of the red flag market book "Irrational Exuberance," that warned just before the crash of 2000 about the riskiness of stocks. Siegel, on the other hand, helped propel the market boom with his 1994 book "Stocks for the Long Run." Dubbed the yin and yang of Wall Street, the two men are actually close friends, who take an annual joint family vacation. We caught up with them this summer to hear what the gurus of risk and caution think about today's market. Jeremy Siegel, it turns out, has just updated his book, its original message intact.

JEREMY SIEGEL: Over long periods of time-- by that, I mean we're talking about 15, 20 years, 30 years-- people planning for retirement, stocks have almost always been their very best asset to hold. And they've given a remarkably stable return over long-term periods.

PAUL SOLMAN: Even when you count the crashes, he says, like the one in '29.

JEREMY SIEGEL: If you were 35 years old, let's say, in 1929, and you wanted to retire at 65, you got 30 years. You put your money in the stock market right at the peak, or in government bonds, or in treasury bills, and 30 years later, you would be way ahead in the stock market.

ROBERT SHILLER: Well, the other side of it is, you could have gotten out in 1929 and gotten back in in 1932 or something, and then you would have done much better.

JEREMEY SIEGEL: You d have done fantastically well.

PAUL SOLMAN: Not surprisingly, Shiller still hews closely to the message of his book.

ROBERT SHILLER: We are deflating from the biggest bubble, or maybe the tie for the biggest bubble, since 1929. And this is a major event that makes me nervous about stock market investing. It could either lumber along without going up at all, or go down substantially. So I feel uncomfortable about stocks.

PAUL SOLMAN: So uncomfortable, in fact, that they're now down to less than 10% of his investment portfolio. Siegel, by contrast, has a whopping 80% of his money in the market. Their asset allocations aside, Siegel and Shiller actually have a lot in common. Both men, now 56, grew up in the Midwest. Shiller's father was a mechanical engineer; Siegel's, the President of a family lumber business. Siegel majored in economics at Columbia, Shiller at the University of Michigan. In 1967, they both went to graduate school at MIT, where they instantly bonded while waiting in line to be tested for TB.

JEREMY SIEGEL: And I'm siegel, "s-I," and Bob is Shiller, "s-H." So we were right together, and our friendship really started in line waiting for our TB X-ray for MIT.

ROBERT SHILLER: Incidentally, that coincidence of the alphabet puts our books together in bookstores. I'll see them side by side.

JEREMY SIEGEL: That's right, Shiller and Siegel.

PAUL SOLMAN: By the late 1970s, Shiller and Siegel were vacationing together with their growing families. And it was on one such trip, to the Pocono Mountains in the early '90s, that Shiller told Siegel his research on long-term stock trends was worth more than an academic paper.

JEREMY SIEGEL: He said, "Jeremy, I think you've got a book here. This is interesting stuff."

PAUL SOLMAN: When Siegel's book came out in 1994, the "Washington Post" called it "one of the ten best investment books of all time." And when Shiller's book emerged in March, 2000, with the Dow at 11000, the NASDAQ at 5000, "Business Week" called it "by far the most important book about the stock market since 'Stocks for the Long Run.'" How vindicated do you feel?

ROBERT SHILLER: Well, you never know. It changes from day to day.

JEREMY SIEGEL: As the market was bouncing around so violently in July, Bob and I were talking about the fact that well, one day it's up tremendously, and I don't look as bad; then it goes down, and Bob looks better. Who is eventually going to be shown right?

PAUL SOLMAN: So are stocks about to resume their upward climb? Or are they heading for a further fall? Well, that depends in large part on what stocks are really worth right now, which, to economists, depends on corporate profitability.

We're here on a golf course. Let's assume that I'm buying a share of the golf course. How do I know if I'm paying a lot or a little for the share of the golf course?

JEREMY SIEGEL: Well, first of all, you have to calculate the profit of the golf course. You have to take all the revenues that they get, subtract off all the expenses from running the golf course, and that's your profits.

PAUL SOLMAN: Let's play this out, in graphic detail. Say the course's profits, after taxes, are $1,000 a year. That's what I'm theoretically buying, a share of those profits. To keep things simple, let's say I buy the whole course. If I invest $1,000 for my share, and earn $1,000 in profits that year, the annual return on my investment is 100%. If the price of my share is $2,000, that's $2,000 invested, $1,000 earned, a 50% annual return -- a price of $10,000, a 10% return-- and so on. In other words, the higher the price I pay, as a ratio of the earnings, the lower my return. And this so-called Price-to-Earnings ratio, or P/E, is the key measure economists use to gauge how expensive stocks are at any given time. At the height of the market a few years ago, the average P/E of all stocks was up near 50:1. Buying stocks at that price meant investing, on average, $50 for every dollar's worth of earnings, a 2% return. Well, that's an extremely poor return on my investment.

JEREMY SIEGEL: That s right.

PAUL SOLMAN: I mean, I could get more than that at a savings account or...

JEREMY SIEGEL: Right. But the second thing is, suppose next year you can sell this golf course at a higher price to someone else?

PAUL SOLMAN: This, of course, was what investors were counting on, sometimes called the "greater fool" theory. Even if economists called you a fool for buying stocks at a price equal to 50 times earnings, you could find a greater fool who'd pay you an even higher price.

JEREMY SIEGEL: Wow, that looks like IPO s during the bubble years. It used to go up 200%, 300% on the first day.

PAUL SOLMAN: But you didn't invest in the internet stocks.

JEREMY SIEGEL: I did not go into any internet stocks, not one.

PAUL SOLMAN: Maybe earnings would soar in the future, justifying that stratospheric price. Maybe people couldn't see anywhere else to invest their money, and were simply going with the flow.

ROBERT SHILLER: But eventually, the market is supported by expectations that can't be continually fulfilled, so eventually when the market stops going up, then the... then people don't see their expectations fulfilled, and they want to sell. And then, when they sell, the market starts to dip, and that generates more desire for selling, eventually into a crash where the market... where everybody is selling at once, and the price falls dramatically.

PAUL SOLMAN: But the price fell, and then it rose again just recently.

ROBERT SHILLER: Yes, because the human dynamics is very complicated, the bubble-burst metaphor was misleading, because the bubble can inflateagain at any time.

PAUL SOLMAN: But to Shiller, the trend was obvious. In the '90s, the divergence between the price of companies and their earnings grew increasingly out of whack. To Siegel, however, the long run trend was what mattered.

There have got to be people in our audience who bought your book and bought stocks on the basis of it, and now say, "what did I do? What did this guy mislead me into doing?"

JEREMY SIEGEL: Yeah. Well, if they bought in March of 2000, yes, they are very unhappy.

PAUL SOLMAN: And unhappy with you.

JEREMY SIEGEL: Yeah, and unhappy with me. But no one said that we banished bear markets. I mean, you know, I didn't say that there wouldn't be short periods of time when you can suffer a really bad shock, and that's what we had! We had a big upsurge, much of which wasn't justified, and then we had a down surge. And I think right now it's rewarding, looking forward in the stock market. Hang in there. Don't sell when everyone's discouraged about stocks and everyone's gloomy. That's usually the best time to actually keep your portfolio and buy stocks.

PAUL SOLMAN: So, in general, Siegel advises buying into a bear market. Yes, he admits, the current overall market Price-to-Earnings ratio is still 20-something to one, by the most conservative reckoning, while the historical average is closer to 15:1. But, says Siegel:

JEREMY SIEGEL: I think the markets have changed. I think the Price/Earnings ratio actually should be somewhat higher, not the way it was. But my feeling is the low 20s is a very justifiable level of the stock market, given the low inflation, low transactions cost, and ease with which people can diversify their portfolios today. These were not present all the time, during the last 130 years or 50 years.

PAUL SOLMAN: Naturally, Bob Shiller disagrees. He believes today's P/E ratio is still too high, by as much as 50%.

ROBERT SHILLER: Even if it is at the right level, there's a chance for it to go down below as the bubble continues to unravel, and I see psychology changing in an increasingly negative direction. So I think that there is a lot of downside potential now.

PAUL SOLMAN: To Shiller, that is, psychology is as important as the P/E ratio, a point poignantly demonstrated on the go-kart track.

PAUL SOLMAN: Are you a lot less of a daredevil than he is?

ROBERT SHILLER: I get the jitters. I can't... I have to relax and enjoy life, you know? I can't... I don't like the stimulus that drives Jeremy.

PAUL SOLMAN: Do you think that that could at all explain the differences in your investing philosophies?

ROBERT SHILLER: Oh, absolutely. I want to be able to sleep at night. Ultimately, you have to feel good about your investments.

SPOKESMAN: Final lap. Go.

PAUL SOLMAN: In the end, then, if there's a moral to draw from the Shiller/Siegel debate, it may simply be this: The best investment strategy is the one that fits best with your own personality.

FOCUS LIBERTY VS. SECURITY

GWEN IFILL: A federal appeals court ruled yesterday the Bush Administration could not impose blanket secrecy on deportation hearings for individuals suspected of terrorist ties. Margaret Warner has more on that.

MARGARET WARNER: In the wake of September 11, the Justice Department began prosecuting immigration laws with renewed vigor. Among those caught in the web was Rabih Haddad, a Lebanese Muslim cleric and activist in Ann Arbor. He was arrested last December for overstaying his tourist visa, on the same day that federal agents seized the assets of a Muslim charity he founded, the Global Relief Foundation. The government suspects Haddad and his foundation of terrorist ties. He's had three secret deportation hearings under closed-door procedures outlined last September 21 by chief immigration Judge Michael Creppy. But in April, in a suit brought by the ACLU and four Michigan newspapers, among others, a district court judge said the Creppy directive was unconstitutional and that Haddad's future hearings had to be open. Yesterday's third circuit ruling used strong language in upholding the lower court. Democracies die behind closed doors, wrote senior Judge Damon Keith. The First Amendment through a free press protects the people s right to know that their government acts fairly, lawfully and accurately in deportation proceedings.

MARGARET WARNER: For more on yesterday's ruling and its implications, we turn to Lucy Dalglish, a media lawyer, and director of the Reporters' Committee for Freedom of the Press. While not involved directly in this case, her group is party to similar suits. And Jan Ting, a former assistant commissioner at the Immigration and Naturalization Service. He now teaches immigration and tax law at Temple University's Beasley School of Law. And welcome to you both. Lucy Dalglish, what did you think when you saw or read yesterday's ruling?

LUCY DALGLISH: I was overjoyed. I thought it was a marvelous decision. The opinion itself reads like a textbook on how to run a democracy. And it really reaffirms faith that we have that we really can get through everything; everything we've been through in the last year is not a reason to abandon the way we operate in this country. And I thought it was very affirming of the court process, the immigration process, and actually reassuring to the public as well. And perhaps, from my perspective, the best result is that for the first time in almost 20 years we have a decision from a significant court, the 6th Circuit, that clearly says that the media has a very important role in the democracy and informing the public.

MARGARET WARNER: Jan Ting, how did you read it?

JAN TING: There's so much to say about this case I really don't know where to begin. I think your viewers need to understand that prior to 1983 there were no immigration judges -- that removal proceedings were conducted by the Immigration Service itself, and it was the Reagan administration, the Reagan administration which decided, you know, it would solve a perceptual problem if we had the people deciding on the removals, different from the people catching the individuals for removal. And so they created the immigration judges. The second thing people need to understand -- and that's an illustration of the fact that I guess no good deed goes unpunished that now we have the 6th Circuit saying that because these immigration judges wear black robes and we call them judges, they become quasi judicial. But they work for the attorney general, they're not what we call Article III courts; they re not part of the Judicial Branch. They're part of the Executive Branch, and they work for the attorney general. And the third thing people need to understand is that there is no immigration clause in the Constitution. We have a government of limited powers that can only do what the Constitution authorizes. How can the government even regulate immigration, and the answer is that 100 years ago the Supreme Court said that immigration, the power to regulate immigration springs not out of the Constitution but it springs out of our national sovereignty kind of because we exist we regulate immigration. And in that decision over 100 years ago, excuse me while I read it, the Court said the power to expel or exclude is a fundamental sovereign attribute, which is exercised by the government's political departments largely immune from judicial control. As recently as 30 years ago the Supreme Court in a case called Mandel see that as long as the government has a facially legitimate and bona fide reason for doing what it does in the area of immigration, courts will neither look behind the exercise of the government's discretion nor test it by balancing the justification of the government against the First Amendment. Well, now I think what the 6th Circuit has done is basically overruled that body of law, and it says as much, it says in the opinion that we've never, there's no precedent for having a First Amendment argument raised in deportation proceedings, but we think that there's a new trend here and we're part of this new trend. And this is almost certainly going to be appealed to the Supreme Court. While we've had a lot of 5-4 decisions, looking at past precedent from the Supreme Court of the United States, I expect this case to be overturned.

MARGARET WARNER: All right. Lucy Dalglish, help us understand this further, and to what degree it was a departure from immigration procedure, because as Jan Ting just pointed out, in fact immigration judges work for Attorney General John Ashcroft, this is all part of the Executive Branch. At issue here was this Creppy memo, this Michael Creppy memo that was issued on September 21. That was pretty sweeping, wasn't it from this immigration judge?

LUCY DALGLISH: It was very sweeping. You have to understand that these proceedings have been conducted largely in the open since 1983 and before that. It was just common for the public to be allowed to witness what's going on in immigration proceedings. What this decision says is not that the Executive Branch cannot --.

MARGARET WARNER: And just let me interrupt to explain to out viewer viewers because we didn't in our introduction, this immigration judge, Judge Creppy said that in these cases that arose out of 9/11 investigation that neither the press nor the public nor even members of the detainee s family would be allowed to be in the hearings.

LUCY DALGLISH: Yes, and that's a departure from the way immigration hearings have been held in the past. And it's, we have a long tradition of open judicial type proceedings in this country. And what the court is doing is extending the openness, the procedure of the openness. The court recognized in this opinion that the Executive Branch still has control over who gets admitted into this country. But once someone is in this country and you decide you're going to kick them out, then certain constitutional protections kick in, including the First Amendment. And what they say is procedurally, if a court or an administrative hearing walks like a duck, squawks like a duck, it's a duck. And if you're going to do something as dramatic as taking away someone's right to be in this country, that's a fairly severe repercussion that should have some public oversight. Now, they are not saying in this opinion that you cannot close immigration proceedings. What they are saying is that if you are going to close an immigration proceeding, you have to make a very particular showing that there is a compelling need to close a specific hearing and that the remedy, closing the hearing, is the most narrowly tailored alternative they have. So I would anticipate that if any sensitive national security information were to come up, which I doubt it will, I would anticipate that there will be a motion made and individual judges will make findings saying, okay, in this particular case this portion of the hearing will be closed.

MARGARET WARNER: Mr. Ting, what is wrong with that, or what would be the harm in that? As I read the decision that the court seemed to be saying the government still has a compelling case to make about national security considerations and some of these hearings, and has to do it individually. What's wrong with that?

JAN TING: Well, you know, the Creppy memo was issued ten days after the September 11 attacks. If the Creppy memo turned out to be overbroad I think everyone could understand how that might be in the ten days after September 11, we didn't really know what we were up against. I don't in fact think that it is overbroad. I think it's a legitimate exercise of the government's power as recognized by the Supreme Court. The standard, which the 6th Circuit chose to apply is different than the standard which the Supreme Court has invoked in prior cases. The Supreme Court has only required the government to show a facially legitimate bona fide reason for what they are doing. And then the Supreme Court says the role of the courts is over with, you shall not look behind that facially legitimate reason for what the government is doing and you shall not balance that reason against the First Amendment.

MARGARET WARNER: But let me ask you a practical question. What is the danger from the government's point of view of having these open or having to make the case on a case by case basis?

JAN TING: Well, you know, from a practical point of view, this case isn't as significant as it seems for the reasons that Lucy just pointed out, that if the government were to lose this at the Supreme Court, which I don't think is going to happen, I think all the precedents favor the government, but if the government were to lose this at the Supreme Court, which I don t think is going to happen, I think all the precedents favor the government, but if the government were to lose it, it would just mean that they would have to go to the immigration judges, who after all are the attorney general's employees, and specify on a case by case basis why they want these immigration cases closed. So I don't think it's a huge significant overruling of government powers here; it just specifies the way in which they have to go about exercising that power as a worst case scenario.

MARGARET WARNER: Miss Dalglish, you said you didn t really think that in these hearings, information related to terrorism and investigation have commonly come up. Why did you say that?

LUCY DALGLISH: I said that because in his opinion, Judge Keith explained that in immigration proceedings, all they're trying to do is show someone entered the country, someone isn't supposed to be in the country anymore, and this person should be sent out.

MARGARET WARNER: In other words they can deport someone strictly on the basis of the immigration violation. They don t have to prove the terrorist ties.

LUCY DALGLISH: They don't have to prove anything about terrorism whatsoever. And, in fact, I'm assuming that these hundreds of people who have been deported, that's exactly what happened. They came in, they demonstrated that they had violated the terms of their visa, and they were gone.

MARGARET WARNER: What about that point, briefly, Mr. Ting, that in these hearings they don't have to prove terrorist ties to get rid of someone who s overstayed his visa?

JAN TING: Well, that s true; there are many grounds for removal from the United States, one of which happens to be terrorism, and there are many other criminal acts that can result in an individual's removal from the United States. What the government has said they don't want to disclose is how they gathered their evidence, who they gathered their evidence from. The government is arguing basically that we're at war here. The courts have historically deferred to the political branches of government in times of war. The courts have historically deferred to the political branches of government in the area of immigration. Both of those factors are present here. And I think it would be a great surprise for the Supreme Court to sustain this particular opinion, although as I said earlier I don't think it has enormous great implications for the way in which the government conducts removal hearings.

MARGARET WARNER: All right, and we'll be following it as it moves through the courts. Thank you both very much.

LUCY DALGLISH: You're welcome.

JAN TING: Thank you.

ENCORE VANISHING VERBS

GWEN IFILL: Now we revisit a story provided by our media unit on the perils of delivering the news quickly. Correspondent Terence Smith reports.

TERENCE SMITH: Today in Washington, around the country, television reporters, talking like this.

CORRESPONDENT: Those negotiations continuing. Mr. Bush speaking to reporters earlier today: Suddenly optimistic.

TERENCE SMITH: Short, staccato bursts.

CORRESPONDENT: Gary Condit today, the first sighting in weeks.

TERENCE SMITH: Fragments, not sentences.

CORRESPONDENT: No natural enemies in North America, lives most of its life underwater.

TERENCE SMITH: Dropping most verbs, everything present tense.

CORRESPONDENT: A man alone as his wife sits in jail, admitting to killing her five children.

TERENCE SMITH: Call it TV Speak, or the case of the vanishing verb. Whatever, it's an abbreviated language unique to time-pressed television correspondents.

CORRESPONDENT: Carts on the course. It's okay for Casey Martin. Supreme Court says so.

TERENCE SMITH: Shepard Smith, the anchor of the fast-paced Fox report on the Fox News Channel, is known for his tickertape delivery.

SHEPARD SMITH: Meantime, the Navy looking for another suitable training location, the Navy secretary saying it will be tough but not impossible. The Navy using Vieques for the past 60 years.

SHEPARD SMITH: You sort of eliminate the things that get in your w in this era of multi-tasking, and sometimes verbs just aren't necessary. It's, "President Bush in Washington today." I don't need to say, "he is in Washington today." "President Bush in Washington today, talking with Colin Powell, getting ready for a trip overseas. Telling other yesterday about what happened when, da, da, da, da." You don't need all those verbs.

CORRESPONDENT: Behind the discounts: A huge slowdown in business travel because of the economy.

TERENCE SMITH: TV Speak is not strictly generational. Robert Hager, the veteran correspondent for NBC News, is often imitated for his clipped style.

ROBERT HAGER: I see it as a kind of shorthand. And in part it was an effort... You get two minutes for your piece or two and a half minutes, it's a terrible amount of information to cram in a short time. You have to keep it real simple.

TERENCE SMITH: Hager, who has been with NBC for 32 years, says television writing was more formal 20 or 30 years ago.

ROBERT HAGER: There was a day and age when editors were much more demanding about the preciseness of the sentences and the editing process, and I think, would have been much less willing to break the rules. When I first started with "The Nightly News," we had a script editor who was... He was god. Oh, and he loved to beat up young, incoming correspondents. Oh, it was torturous. So the script approval process would be a couple of hours.

TERENCE SMITH: One of the script doctors at CBS News for ma years was Tom Phillips.

TOM PHILLIPS: The expectation back in the 1970s was that we would write stuff that you could read right from the page and ld be elegant, it would have all its parts there. The sentences would be balanced. They would have their subjects and verbs and objects. You'd know where they began and where they ended.

TERENCE SMITH: And today?

TOM PHILLIPS: You hear a lot of... You hear a lot of sentences that aren't really sentences. You hear a lot of words dropped. You hear a lot of... Kind of episodic speech with "..." Where the connective tissue used to be.

TERENCE SMITH: Does it work for you?

TOM PHILLIPS: I don't like it very much. Back in those days, maybe 20 years ago, I think we had the feeling we were writing for an audience of smart 12-year-olds.

TERENCE SMITH: Who are you writing for now?

TOM PHILLIPS: Well, I think maybe a seven- year-old.

TERENCE SMITH: The telegraphic style crops up across the broadcast and cable spectrum, but it's particularly noticeable on the "NBC Nightly News." However, the anchor, Tom Brokaw, is not enthusiastic about it.

TOM BROKAW: Some of it is generational, and I swarm all over it as best I can. But it's how a lot of them were raised, how a lot of young reporters were raised. And I think it grows out of the cable culture, because they work not just for me anymore. They work across the line on cable.

TERENCE SMITH: But younger television correspondents didn't have to invent TV Speak. It's actually encouraged in style books, like this one, "Air Words: Writing for Broadcast News." In it, the author, John Hewitt, recommends using what he calls "elliptical sentences, sentence fragments with implied but unspoken words or phrases."

CORRESPONDENT: I'm glad you trimmed that, by the way.

TERENCE SMITH: Time, of course, is the ultimate tyrant in television news, and Shepard Smith argues that shedding verbs, the workhorse of traditional sentence structure, permits him to shoehorn more news into less time.

SHEPARD SMITH: We're telling more stories in our hour than any national newscast in the history of this business, I think. We're darn close to it if we're not, and sometimes verbs just get in the way. I don't use them all the time when I'm talking, so I don't use them all the time on TV.

TERENCE SMITH: He calls it "People Speak."

SHEPARD SMITH: It's about how would I tell this story if I were telling it to a friend on a street corner while waiting for the subway or waiting for a plane? We don't... We don't tell stories the way we write stories. We don't. We speak in... We speak in thoughts. We don't speak in sentences with periods and dashes and colons and commas. That's not how we talk. So I try to talk like I speak when I'm yakking with my buddies.

TERENCE SMITH: And script Doctor Tom Phillips, who moonlights as a Shakespearean actor, says that elliptical English is nothing new.

TOM PHILLIPS: Shakespeare broke all the rules, including some I was very fussy about when I was a news editor. Leaving out words is one of his favorite techniques when he's in a rush to tell you something. Like King Lear says, "oh, me, my heart, my rising heart. But down." Three sentences; no verb.

TERENCE SMITH: Judging from this script, Kelly O'Donnell of NBC News has been brushing up on herShakespeare.

KELLY O'DONNELL: Today the farewell. In West Palm Beach, Florida, those who loved Barry Grunow, those who learned from him in the classroom, come together to remember.

TERENCE SMITH: Verbs are few and far between as she continues.

KELLY O'DONNELL: A teacher for nearly 13 years, a husband to Pamela for nine, a father to five-year-old Sam, nine-month-old daughter Lee Anne.

TERENCE SMITH: Anchor Brokaw says he does what he can to curb the technique.

TOM BROKAW: I pull the chain, you know, when I catch it, when it's done late and say, "look this is nuts, people. It's flying by, for one thing. And it's not landing there in the consciousness of the viewer, and you have to be aware of that." I have had a talk with a couple of our correspondents about slowing down, speaking in complete sentences with a beginning, middle and end, with all of the component parts.

TERENCE SMITH: And a verb?

TOM BROKAW: With a verb, right.

TERENCE SMITH: (Laughs) It was Shakespeare, of course, who wrote...

ACTOR: Brevity is the soul of wit.

TERENCE SMITH: But Tom Phillips argues that the best guide to television writing was provided not by the bard, but Albert Einstein.

TOM PHILLIPS: A quote from Einstein that used to be on the wall of the "CBS Evening News," "make everything as simple as possible, but not simpler."

FINALLY - INFERNO

GWEN IFILL: Finally tonight, will there be a baseball strike? Friday's the deadline, and worried fans are beginning to think the very future of the national pastime is at stake, and former poet laureate Robert Pinsky has a warning.

ROBERT PINSKY: In the baseball negotiations, each side accuses the other of greed, the sin also called avarice. Overspending is another accusation. I wonder if it would be helpful to offer some expert testimony on greed. In Dante's "Inferno," the part of hell reserved for the gluttonous is pelted by a mixture of snow and sewage. A little further down, there is an eternal contest between the greedy hoarders and the equally greedy over spenders. They crash into one another, lugging great stones in their arms, over and over. I quote, "each pushes a weight against his chest, and howls at his opponent each time that they clash, 'why do you squander?', And 'why do you hoard?' Each wheels to roll his weight back round again. They rush toward the circle's opposite point, collide painfully once more, and curse each other afresh; and after that refrain each one must head through the half-circle again, to his next joust." It seems clear from this description that in Dante's vision, if the owners and the players' association persist in hoarding and squandering, they may be condemned to suffer in hell as football players.

RECAP

GWEN IFILL: Again, the major developments of the day: Several key Arab nations repeated their opposition to any U.S. attack on Iraq, as President Bush met with the Saudi ambassador. And a White House spokesman confirmed the administration is seeking broad powers to keep the Presidential pardon process secret. We'll see you online, and again here tomorrow evening. I'm Gwen Ifill. Thank you and good night.