The MacNeil/Lehrer NewsHour

MR. LEHRER: Good evening. Leading the News this Monday more than 200,000 people staged an anti-government demonstration in Czechoslovakia, the President of Romania rejected democratic reforms for his country, and the U.S. House voted against new restrictions on aid to El Salvador. We'll have the details in our News Summary in a moment. Charlayne Hunter-Gault is in New York tonight. Charlayne.

MS. HUNTER-GAULT: After the News Summary, we go first to the continuing drama of Eastern Europe. Tonight we look at the defiant stands of the hardline countries. We get the views of a former Ambassador to Bulgaria, a former Czech diplomat and a Romanian defector and Eastern European analyst. Next Correspondent Roger Mudd looks at the Congressional involvement with the Lincoln & Savings scandal, and finally Robert MacNeil talks with the man who is the watchdog of doublespeak, William Lutz. NEWS SUMMARY

MR. LEHRER: Two hundred thousand anti-government demonstrators marched through Prague, Czechoslovakia today. It was the largest public protest in the history of that hardline Communist nation. Police did not interfere with today's march as they have with previous ones. We have a report from Prague by Brent Sadler of Independent Television News.

MR. SADLER: A symbolic rattling of keys echoed across Prague in a direct challenge to the Communist regime. It was a clear warning that the days of the hardliners are numbered, that the drive for reform is unstoppable. Student power is now flexing its muscles, emulating their Chinese pro-democracy counterparts by sticking up war protests throughout the capital. It's been a day of unprecedented dissent against the Communist Party and government. Each demonstration gets bigger, the chorus of dissatisfaction louder. The faces of reform hungry crowds are glued to the outpouring of opposition commentary. It's growing so fast that a leading dissident made history today by calling the first press conference of his life. Vaclav Havel said the government was already making secret contacts with the opposition.

VACLAV HAVEL, Opposition Leader: I think that it is a most important time after 20 years. The public and society is now able rather openly to express their wish for democracy, for freedom.

MR. LEHRER: The leader of the Communist Party in Czechoslovakia addressed his nation on television tonight. Milosh Yakis warned that any attempts to disrupt social and political stability could lead to a crisis with unforeseeable consequences. In Washington, the State Department announced it had canceled a high level Czech official's visit to the U.S. The official is the Communist Party's ideology chief. Asst. Sec. of State Richard Schifter said the action was taken to protest the police use of force against demonstrators last Friday. Charlayne.

MS. HUNTER-GAULT: Romanian Leader Nikolai Chaoczesku today stood up to the reform movement sweeping Eastern Europe, ignoring calls for change from the Soviet Union and Hungary. Instead the 71 year old leader who has ruled his country for 24 years told the opening of a Communist Party congress that the party cannot give up its revolutionary responsibility or surrender its historical mission to another force. He also said that the country would increase its military strength. Meanwhile, there were pro-democracy demonstrations in many East German cities, the largest in Leipzig, where some 100,000 people marched through the streets demanding free elections. But a new note was sounded by some of the pressing for German reunification. They carried banners calling for a single fatherland.

MR. LEHRER: In El Salvador, wire reports said the leftist rebels' offensive has been stopped. Only sporadic fighting in isolated sections of the capital city of San Salvador was still going on. Pres. Bush urged Congress today to leave aid to El Salvador alone. He told reporters the government should be given a chance to solve the brutal murders of six Jesuit priests last week. He spoke before boarding a plane at Andrews Air Force Base outside of Washington.

PRES. BUSH: Here's a freely elected government, doing their very best, trying to protect their population from these Marxist led guerrillas coming in to the center of the city, and we support Pres. Cristiani in his effort to restore order, and I must tell the Congress of the United States that I will not accept as President a cut off of aid to El Salvador; that's it.

REPORTER: Did he assure you the government wasn't involved, sir, and do you believe him when he says it?

PRES. BUSH: If the government wasn't involved, absolutely, I believe him. Now if some renegade forces were involved on the left or the right, they should be brought to justice. But absolutely. Cristiani would not lie to me on a matter of this nature. He knew nothing about it. Our ambassador is in close touch with him. He feels as strongly as I do about it.

MR. LEHRER: Support for El Salvador was the issue when hecklers took on Mr. Bush at a political fund-raising event in Chicago. It triggered this exchange.

PRES. BUSH: Look at this guy. Look at this fella. What's your position? [HECKLER]

PRES. BUSH: Let me just say a word about El Salvador and maybe it'll help. It was the FMLN, the Marxist-Leninist FMLN that shot its way into the middle of El Salvador trying to disrupt Salvador's democracy.

HECKLER: Stop repression! Stop repression!

PRES. BUSH: And Pres. Cristiani told me on the phone that they will do everything they can to bring to justice whether they're from the right or the left those who wantonly murdered those priests. But we must not pull our support away for a freely elected democratic government.

MR. LEHRER: The House of Representatives later voted in accordance with the President's wishes declining in a close procedural vote to place restrictions on El Salvador aid in a foreign aid package. Such a proposal is still alive in the Senate. The House went on to pass a new foreign aid bill following a veto by Pres. Bush. The new version deletes $15 million for the United Nation's population fund. Mr. Bush objected to the fund, claiming it supported forced abortions in China.

MS. HUNTER-GAULT: In other Presidential news, Mr. Bush plans to speak to the nation on Thanksgiving aid the White House announced today. He will talk about the upcoming summit with Soviet Leader Gorbachev and the Democratic reform move in Eastern Europe. But the White House also said his main message will be traditional Thanksgiving. The speech is scheduled for 9 PM Eastern Time from Camp David. That's it for the News Summary. Still to come the hardliners of Eastern Europe, the Lincoln Savings & Loan scandal and the word watchdog, William Lutz. FOCUS - HARDLINE HOLDOUTS

MS. HUNTER-GAULT: We begin again tonight with the changes sweeping through Eastern Europe. Every day one country after another that has been apparently immune to reform of dogmatic communism starts reforming itself or begins to feel immense public pressure to make changes. But amid the changes taking place there have been some holdouts and it is on those that we focustonight. In a few minutes, we'll talk with a former Czech diplomate, a Romanian defector and a former U.S. Ambassador to Bulgaria. But first some background. The winds of change are blowing through out most of Eastern Europe from Hungary to Poland to East Germany. But they are being stopped at some borders. First, among the holdouts is Czechoslovakia. For years most Czech's didn't make a sound for the need for reform . But long simmering discontent began spilling into the streets earlier this year. Starting in January there were several protests all broken up violently by police. The size of the protest grew considerably this weekend. Since Friday, tens of thousands of Czech have gathered in the capital to demand democratic reform and each night Czech police use violence to break up the peaceful demonstrations. But that has not put an end to the reform movement. Today Czechoslovakia had its biggest demonstration yet and this time police let the march go on. Many of the protestors called for the resignation of Communist Party Leader Milosh Jackish and they demanded free elections. The last time there was a reform movement in Czechoslovakia was in the spring of 1968 and it was actually lead by the Government. But that movement was crushed by Soviet and Warsaw Pact tanks. That action lead to the sol called Brezhnev doctrine. The concept that Warsaw Pact Nations has a right to maintain socialism by force. Now a new Soviet Leader appears to be encouraging reform. Gorbachev's visit two years ago was widely seen as a pitch for the Czech's to, make Soviet style reform. But up to now the hard line Czech leadership which mainly was imposed by Moscow in 1968 has resisted that pressure. One Warsaw Pact nation that refused to join the 1968 invasion of Czechoslovakia was Romania, Romania has a history of standing up to Moscow and for a while was courted actively by American Administrations. Now that Moscow is encouraging reform Romania is digging in again. The man in Charge of Romania for more than 20 years now is Nikoli Cuchesco who has shown increasing signs of trying to turn the Country in to a family dictatorship. Today in a 5 hour speech to a Communist Party Conference he rejected the reforms of his neighbors. Chuchesco said Romania must stay the course of scientific socialism. In contrast to maverick Romania Bulgaria has been a loyal Slav ali of Russia long before either was communist. Until last week Bulgaria's Communist Rulers also resisted Moscow's suggestions for reform. But their resistance suddenly crumbled 10 days ago with the surprise announcement that long time Party Chief and Government Head Tordor Zitcoff was stepping aside. He was replaced by the foreign minister, Pitard Maladinoff. By Bulgarian standards the changes since have been electric. The old leadership has been removed and an unprecedented event took place this weekend. A pro democracy demonstrations. There were many chants that Zitcoff should be jailed for corruption. Like his Balkan neighbors Bulgaria has economic problem,s especially providing staples to its people like butter, cheese and sugar. But now those people like many across Eastern Europe are demanding not only more goods in their shops but real choices in their political lives.

MR. LEHRER: Now to three views of what is happening in these three communist nations. Milan Svec was Czechoslovakia's Deputy Ambassador in Washington from 1982 to 1985 when he defected to the U.S. He's currently a fellow at the United States Institute of Peace a government financed think tank here in Washington. Vladimir Tismaneanu defected from Romania in 1981. He is a Fellow at the Foreign Policy Research Institute in Philadelphia , a lecturer in Eastern European affairs at the University of Pennsylvania. Raymond Garthoff was the U.S. Ambassador to Bulgaria in the late 1970s. He is a retired foreign service officer who is now at the Brookings Institution. Let's begin with you Mr. Svec and Czechoslovakia. Today momentous demonstration. The police let it go on. How do read that. What is happening.

MILAN SVEC, Former Czech Diplomat: I think that there is an enormous catalyst for what we see in Czechoslovakia was East Germany. For quite a time Czech Leadership was hiding behind East German Leadership and East German Leadership seemed to keep the situation under control for some time. That cover has blown up. Secondly the people in Czechoslovaks thought that if the Soviets let people in East Germany demonstrate and that is no action on the Soviet part why wouldn't they be able to same thing. And also the people understood that all around them, in Hungary and Poland the atmosphere was such that either now or when.

MR. LEHRER: But Friday, the police reacted violently to a smaller and yet today they did not.

MR. SVEC: Yes, because in the very beginning the instinct of the Government is giving it a try to have it as it was before. And it has been very comfortable for the Government. so they wanted it that way. Now they understand that the things are getting so fast out of hand that they have to switch the tactics and we already see some of them.

MR. LEHRER: All right. What's likely to happen? Could what happened in East Germany now happen in Czechoslovakia, the call for pluralism, for elections for all these incredible things?

MR. SVEC: Now the people in Czechoslovakia must understand and I think that they understand that it is in their hands provided that they keep the heat on the Government and the party leadership. I don't think that the Tiananmen Square alternative is viable in Prague, in the very heart of Europe.

MR. LEHRER: You mean the brutal use of force and shooting people? That option is gone?

MR. SVEC: I cannot imagine it. I mean if they did that it would be on the border of unimaginable and I don't want to speculate but as far as logic is concerned it is impossible.

MR. LEHRER: Is Mr. Yakosh the one. Will he do the reforming or is some body else have to come in and do it?

MR. SVEC: I don't think Yakosh will do it because he had an opportunity to do it. He had some time actually plenty of time to introduce more reforms. He had plenty of opportunities even to react in a more forth coming way after East Germany. He did not do so. He's lost. There's no faith in him in the population.

MR. LEHRER: In the simplest terms, what is it that you think that the people of Czechoslovakia want. These 200,000 people. What specifically do they want?

MR. SVEC: They definitely more democracy in the first order.

MR. LEHRER: You mean they want the same kind of that we talk about here?

MR. SVEC: Can you imagine the Czech's they were the only democracy between two World Wars. From the first World War to the second World War. They only real democracy in Central Eastern Europe as we know it was in Czechoslovakia. Now if they don't do what they are doing protesting in the streets they will be the only country that would not have free elections. So I think that everybody realizes that it's the time to fight for your own rights, and they are doing just that.

MR. LEHRER: Mr.Tismaneanu, Romania. The President said today no reforms here friends forget it?

VLADIMIR TISMANEANU, Romanian Defector: He has said that for a long time.

MR. LEHRER: Can he make that stick?

MR. TISMANEANU: For the time being Romania is quite isolated in the Warsaw Pact. He has managed to create a power base for himself primarily with in the security police and that group of cronies. It is as your reporter was mentioning it is very much a clan dictatorship or a family dictatorship there. I would compare it rather to Haiti rather than to Czechoslovaks and Central Europe. So it can be sort of a Papa Doc baby Doc dictatorship including the President's wife who happens to be the number two person in the party,

MR. LEHRER: The President's wife in the communist party. In others words she is the number two person running the country?

MR. TISMANEANU: She is the number person. It is in the family. They call it in Romania socialism in one family because after all that is what we deal with.

MR. LEHRER: Wow. I see. He said today, he talked for five hours and as I said he said no. Is there a pro-democracy movement alive in that country. Are there reformers anywhere in the country or in the Government who could change things.

MR. TISMANEANU: I'd like to sound very optimistic in my response. I'm afraid I'm going to disappoint those who want rosy pictures of Central Europe or Eastern Europe for the near future. There are not very many dissidents in Romania. The dissident movements in Romania has actually been stamped out by the secret police. There are individuals who have protested very courageous but they are completely isolated and marginalized. So what I expect in on one hand perhaps an intra party coup based on conspiracy with some support and favorable signals coming from the Soviet Union.

MR. LEHRER: Let me stop you there. You mean the people who are now in the Government within the power structure would just turn around. They would get a signal from Gorbachev that it is all right to get rid of this guy and take the Government over. Is that what you are saying.

MR. TISMANEANU: No, I think there are very much aware of the mass potential for mass unrest and social explosion in Romania. At this moment lets say that Romania is the most repressive society in Eastern Europe.

MR. LEHRER: Explain what that means. Why is it the moist repressive.

MR. TISMANEANU: Mr. Chuchesko decided in 1982 actually he decided to pay his foreign debt which he did but he didn't do it in a productive way on the basis of what his industrial output but with his population. What has happened in Romania is people have been forced to starve and freeze in their apartments. You know there is no other country in Eastern Europe where empty shelves in department stores and food stores look like they do in Romania. It is one of the most desolated countries that place in Europe at this moment. It used to be called little Paris.

MR. LEHRER: It used to be called Little Paris?

MR. TISMANEANU: Little Paris. Now the called Chowswitz.

MR. LEHRER: What about political rights. Do the people have any political rights?

MR. TISMANEANU: In the constitution there are plenty of political rights. The right to applaud the president, the right to vote for the president, the right to vote for all the 100 institutions that the president and his wife preside over and so on. But in terms of human rights, if you ask me about the right to express ones own view that's out of the question in contemporary Romania.

MR. LEHRER: Now let's go to Bulgaria, Mr. Ambassador. There has been sign of reform already the resignation last week of the head of the party and soforth. How far is it going to go?

RAYMOND GARTHOFF, Former U.S. Ambassador, Bulgaria: I think Bulgaria has already left your category of hard line hold out states. We still have to see what will develop in the period ahead but I think that it is a real change. Clearly some elements in the leadership in Bulgaria with encouragement from Moscow have decided that the lesson in East Germany was this kind of change could not be held back. And what they're trying to do in Bulgaria is to get ahead of the curve and act before there were public demonstrations.

MR. LEHRER: That announcement last week just kind of came out of no where. I mean there had been no protests nothing.

AMB. GARTHOFF: No it is not in reaction not to response to public protest but a way of acting before that kind of public dissatisfaction would make itself felt. Now once people are free to go out and demonstrate they are and they are showing that they had much greater pent up dissatisfactions than had been evident in the past when there had really no protests of this kind. But I think that the new leader, who was foreign minister when I was there as ambassador is very able and I think has a good general understanding of the world, is pragmatic and I think will be inclined to move foreword with economic and political reforms.

MR. LEHRER: Being pushed by Gorbachev?

AMB. GARTHOFF: I think he is probably the nearest analog in Eastern Europe to Gorbachev. I think he wants to have reforms.

MR. LEHRER: Where would he have learned that. I mean, where does he come from. Why would he be a reformer?

AMB. GARTHOFF: Well I think that a good question in all of these cases where people do it here and in this case where he has been in charge for many years. And of course Mundaniff has been part of this leadership. He has been a member of the polite bureau himself for about 12 years but he has been foreign minister and he has been mainly concerned with international affairs. he got his higher education in the Soviet Union and has from that standpoint, he's come from the system the same way that Gorbachev, himself, has. Now when I say this, I think that he will also seek to keep political liberalization within a system which still has one communist party.

MR. LEHRER: Will he get away with that?

AMB. GARTHOFF: That's hard to say. I think perhaps initially. I think that he will allow different groups and so forth with in the party and if necessary would be prepared to fall back to Hungarian pattern and allow other parties as well to come in to being. But I think in the first instance he will seek some real degree of liberalization but preferably in a one party system still.

MR. LEHRER: Where would you put Bulgaria on the repression scale using Romania as a measuring stick?

AMB. GARTHOFF: The situation in Bulgaria has been much less repressive for quite a number of years than in Romania and less so in recent years certainly than in Czechoslovakia. But there hasn't been any political expression or dissidents allowed at a time when in the Soviet Union still. There was for example repression against things such as modern art or allowing young people to have disco's this sort of that. That was allowed in Bulgaria. But now that barrier is down and it really remains to be seen whether the people will be prepared for the kind of limited liberalization that I think they will be offered in the first instance or whether the government will have to give them still more.

MR. LEHRER: Back to you, Mr. Tismaneanu as far as Romania is concerned. You heard what Mr. Svec said that he felt that the use of force, military force against the people. He thinks that option has been pretty well eliminated in Czechoslovakia. Is it still alive in Romania if the people should catch the fever?

MR. TISMANEANU: First of all I think that it would take some time for the people in Romania to catch the fever. The Czechs have had plenty of experience. There is the kind of informal or associational, informal organizations that have developed in Czechoslovaks and even in Bulgaria the ecological environmentalist.

MR. LEHRER: Not a lot of cross-fertilization between the countries?

MR. TISMANEANU: Very little. There is a lot of cross fertilization if you want to call it the national dissident movement in Poland and Czechoslovakia and East Germany. Romania is quite isolated and to the best of my knowledge, I may be wrong Bulgaria has been quite isolated. But in Bulgaria, I think, the impact of Soviet Television was extraordinary. In Romania much less.

MR. LEHRER: You think, to go back to what you said, Mr. Svec, you think it is the East Germany events that really turned the Czechoslovakian thing around?

MR. SVEC: Yes, I'm absolutely positively about that.

MR. LEHRER: And what about just the information flow? I mean the people in Romania and Bulgaria how are they finding out what is happening in Czechoslovakia and East Germany and elsewhere. Do they have access to information?

MR. Tismaneanu: They are extremely frustrated in Romania. Imagine a country that has neighbors like Bulgaria on the South, Yugoslavia and Hungary on the Western side. The Soviet Union the whole North and to get all this information. By the way the Soviet Union's Moldavia that has the Romanian language, so the Soviet television is captured in a quarter of Romania and Hungarian television in a quarter of Romania and all the rest, 2/4, get Bulgarian and Yugoslav television. In addition think of Radio Free, VOA, Voice of America. Frustration they hear and they listen and they are unhappy.

MR. LEHRER: Contrast that with Czechoslovakia how well informed are the people of Czechoslovakia? How well have informed have they been about events in East Germany and elsewhere?

MR. SVEC: They have been informed very well.

MR. LEHRER: By whom?

MR. SVEC: A lot of people in Czechoslovakia case especially in the Southern part of the country watch directly East German television or Austrian television all of the territory listens to Voice of America regularly and other foreign broadcasts. So the people have been informed pretty well. As I've said, some may be waiting that Gorbachev will deliver them. You know, there were a lot of different considerations.

MR. LEHRER: That he would just make an announcement and say 68 is over?

MR. SVEC: Not necessarily, but the sense of it being okay we Russians understand that we made a mistake in 1968. So me Gorbachev the reformer I'm ready to somehow undo it and help you. But to the surprise and not necessarily an unpleasant one Gorbachev says it's up to you and the people realize it and now I hope only that the regime will realize that it also has to move. If I may make one point though. There seems to be the only really working domino theory in modern history now in Eastern Europe, all the countries falling down one after the other in line for reformism. Now what we should be aware of and the West should somehow face that after these domino effects we will see each country approaching it in its own way.

MR. LEHRER: That's another whole program. We'll do it. And of course, Mr. Tismaneanu says one of the dominos that will be last to fall will be Romania. Gentleman thank you all three very much.

MS. HUNTER-GAULT: Still to come, the Lincoln Savings and Loan scandal and the author of Doublespeak. FOCUS - SAVINGS & LOSS

MS. HUNTER-GAULT: We turn next to the Capitol Hill story of the Keating Five. They are five prominent Senators under investigation for meeting with federal regulators on behalf of Lincoln Savings & Loan owner Charles Keating. On Friday, the Senate Ethics Committee appointed an independent counsel to investigate the role of the Senators. Our Congressional Correspondent Roger Mudd has this report on the Senators and their growing problems.

MR. MUDD: This man is a United States Senator. He is John McCain, a Republican from Arizona, and you are about to hear him say something that very few Senators have ever said before. Listen carefully.

SEN. JOHN McCAIN, [R] Arizona: It was a very serious mistake on my part. The appearance of a meeting with five Senators was bad and wrong and I agonized over it at the time.

MR. MUDD: John McCain is talking about the role he played in Charles Keating's attempt in 1987 to secure Senatorial protection against the federal government taking over his Lincoln Savings & Loan. But as it develops, John McCain has been talking. The four other Senators who involved in the Keating story, Democrats Cranston of California, DeConcini of Arizona, Glenn of Ohio, and Riegle of Michigan, all had been following a policy of stonewalling the press. But last Friday, the day the Senate Ethics Committee hired outside counsel to begin a preliminary inquiry, John Glenn broke his silence.

SEN. GLENN: Everything I did in this was not only legal, I believe it was moral, it was ethical. But do I feel badly about this thing, yes. I've never had anything bother me more since I've been in public life, and if I was guilty of something, I feel I'd take my lumps and that was it. I'm not. I never acted in a more ethical, moral and legal way in my life. And to imply otherwise is just flat wrong.

MR. MUDD: McCain, however, seems to be trying to talk the story to death. He began talking before the hometown press in Phoenix.

SEN. McCAIN: [October 16] But the appearance of five Senators meeting with one regulator clearly is, if not improper, certainly bad appearance.

MR. MUDD: Next he talked on the Cable News Evans & Novak Show.

SEN. McCAIN: I think Congressmen and Senators should intervene on behalf of individual consistence or companies or corporations who are in danger of being mistreated or regulatory bodies are reaching the wrong decisions. I intervened with the FAA about a year ago over some flights over the Grand Canyon legislation, their interpretation. I met with the head of the SBA not too long ago about --

MR. MUDD: And tonight he's talking on the MacNeil-Lehrer Newshour.

SEN. McCAIN: I'm doing everything that I can to try and set the record straight, again, admitting that I made mistakes, and serious ones. But I did not abuse my office, and I think that's the key to this issue. The fact is that I want to talk to anybody that wants to talk to me because I feel the more that is known of my involvement in this issue, the better off I am.

MR. MUDD: McCain's so called open door policy has already attracted some press and public sympathy. But it's still a roll of the dice as to whether the more the public knows about his role the better off he'll be. Each of the five Senators has put out his own version of the episode, put out mainly by staff, but because those versions are designed to make each Senator look clean,there are growing discrepancies among them. The following facts of the story appear not to be in dispute. In 1984, Charles Keating, a Cincinnati Republican, a lawyer, a financier, president of the Phoenix-based American Continental Corporation, bought the California chartered Lincoln Savings & Loan for $51 million. But he soon ran afoul of federal bank regulators who claimed they saw a pattern of irregular and risky investments in raw land, junk bonds and development projects. Keating appealed for help from five U.S. Senators. All five and/or their political organizations had received contributions from Keating, Cranston $897,000; DeConcini $55,000; Glenn $234,000; Riegle $76,000; McCain $125,000. On April 2, 1987, about 6 PM, Edwin J. Gray, the head of the Federal Home Loan Bank Board, arrived for a meeting at Sen. DeConcini's Capitol Hill office.

EDWIN GRAY: When I arrived, there was really no small talk. We sat down. Sen. DeConcini sat across from me. To his right, was Sen. McCain. To Sen. McCain's right was Sen. Cranston over more towards the end of the room. And then to my right was Sen. Glenn.

SEN. McCAIN: I was informed through staff that the meeting was going to take place and that Mr. Gray would be there. And I take responsibility for attending but I didn't set up the meeting, nor did I set the parameters for it.

MR. MUDD: NewsWeek said that McCain for one worried about going to meetings.

SEN. McCAIN: Absolutely.

MR. MUDD: Why were you worried and if you were worried, why the heck did you go?

SEN. McCAIN: I was worried about the appearance of five Senators or four Senators at a meeting, and the reason why I went after telling Mr. Keating a week before the meeting that I would do nothing that was improper as far as doing any quid pro quo for him with regulators, the reason why I went is because I thought I had the obligation to see that not Mr. Keating but the corporation was receiving fair and equitable treatment under the law.

MR. MUDD: But don't you as a Senator have an obligation to avoid the appearance of impropriety?

SEN. McCAIN: Absolutely, Roger, and a mistake was made because of the appearance of that. But I didn't think the appearance problem overrode my obligation to a major economic factor in my state to see that they were fairly treated.

MR. MUDD: McCain says he went to the meeting because of two documents.

SEN. McCAIN: One was by Alan Greenspan, now the head of the Federal Reserve, that said Lincoln Savings & Loan is a viable strong, important organization. And the other was an Arthur Young, one of the big eight accounting firms' study that Lincoln Savings was being treated with hostility, intimidation, harassment, the longest investigation in the history of the Federal Home Loan Bank Board.

MR. MUDD: But both Greenspan and Arthur Young were on Charles Keating's payroll, were they not?

SEN. McCAIN: I find that out now, yes, in hind sight, but I still find it hard to believe that Alan Greenspan, now the head of the Federal Reserve, and big eight accounting firm, would do something which would be a betrayal of what's the truth. But of course I didn't even know they were on the payroll at the time.

MR. MUDD: Arthur Young is also John Glenn's defense for attending the meeting.

SEN. JOHN GLENN, [D] Ohio: The Arthur Young people came in and we had one of the senior partners of Arthur Young said not only was Lincoln a viable institution but that they were being harassed. It was his opinion. Bullying tactics had been used. It was the most adversarial relationship, and said that they thoughtit was harassment too, and it was on Arthur Young's stationery, and backed up with a senior partner coming in. Now on that grounds, I agreed that there was harassment, a reason to think that there had been, and agreed to go to the meeting.

MR. MUDD: Edwin Gray said the meeting was awkward and tense.

EDWIN GRAY, Former Chairman, Federal Home Loan Bank Board: Sen. DeConcini started talking and then Sen. McCain said, now we don't want to do anything improper here, and I said, well, it's not improper for Senators to ask questions.

MR. MUDD: So what was said and who said it? Gray claims DeConcini did most of the talking.

MR. GRAY: In the conversation he was having, he used the term "we", so he seemed to be speaking on behalf of the others. As I say, they didn't raise any objections to what he was saying, and he said, he was very concerned, we are very concerned about this rule that you have adopted on direct investments, concerned that it might be unconstitutional, and he said that he felt that we should wait until we could determine whether the regulation was legal and therefore he wanted me to withdraw the regulation until we could find out whether it was legal.

MR. MUDD: DeConcini has described Gray's version as so distorted as to bear no resemblance to fact. But Alan Cranston has been quoted by the San Francisco Chronicle that he and the three other Senators may well have quizzed Gray about the rule restricting savings & loan investments. John Glenn says he does not recall any deal.

SEN. GLENN: I do not recall at the first meeting that there was any deal, any suggestion of pull back from any regulation at all. If that was made, I was certainly not paying close attention and listening to it.

MR. MUDD: John McCain says he is not able to recall a deal either.

SEN. McCAIN: I don't clearly at all recall that meeting after Mr. Gray told us that he had nothing to do with the ongoing investigation of Lincoln. I came there for the purpose of finding out about the investigation of Lincoln, whether it was fair or unfair. After he said, one, he had nothing to do with it, and two, that the regulators would be available the next week, and I asked him whether that would be proper or not, he said it would be proper, then I had no further interest. That was 2 1/2 years ago, and I have no knowledge of it.

MR. MUDD: But a second meeting was held a week later in DeConcini's office with four bank regulators from San Francisco. This time there were five Senators present, the original four plus Riegle of Michigan, who has since become chairman of the banking committee. At least two of the other Senators now say it was Riegle who arranged the first meeting. One of the regulators at the second meeting was William Black who tried to warn the five Senators about Lincoln Savings & Loan.

WILLIAM BLACK, Thrift Regulator: [October 26] We explained their huge violations of law, their misrepresentations, their terrible accounting practices, and their violations of the direct investment limits. And as I quoted, both Mr. Cerona and Mr. Patriarcha respectively told them it was a ticking time bomb and that he could guarantee that it would fail if it continued this way. I think they were told in bold letters with exclamation points and in supporting details below it.

SPOKESMAN: At that time did the Senators back off then from pressing Lincoln's case?

MR. BLACK: No. They only backed off, and only a little, when we told them about the criminal referrals.

MR. MUDD: It was Michael Patriarcha who told the Senators that he thought Lincoln Savings & Loan was guilty of file stuffing and document back dating.

MR. MUDD: When Patriarcha said we've got a criminal referral here, did you say to yourself, oh, my God, what am I doing here?

SEN. McCAIN: No, but I said, oh, my God, this company is in a lot worse trouble than I thought they were.

MR. MUDD: So with the mention of criminality, three of the five Senators, Glenn, McCain and Riegle, apparently withdrew from the case. But it was another two years before the federal government finally seized Lincoln Savings & Loan to begin a bailout that will probably cost the taxpayers about $2 1/2 billion. The five Senators have all said that they were performing a service for a constituent, that his political contributions did not influence their actions or judgment, that they violated no rule, standard or law, and that they did not dishonor their office. But only John McCain has fully thrown himself at the mercy of the court of public opinion.

MR. MUDD: You told me this was the political crisis of your life.

SEN. McCAIN: Absolutely.

MR. MUDD: Tell me why it is.

SEN. McCAIN: Because my reputation is at stake here. I've never had my ethics or my standards of conduct questioned. And frankly it's not a political career that's at stake. I can do a lot of other things I think and serve the country in a lot of ways. But what's at stake here is my reputation and that I think through honorable service to the country I've built up over many years. And frankly that's what's so disturbing about it to me.

MR. MUDD: Do you think you'll survive it?

SEN. McCAIN: I hope so. I hope so.

MR. MUDD: But it'll be awhile before the five Senators find out which policy works best with the public, the open door or the stone wall? McCain, Glenn and Cranston, will not be up for re-election until 1992, DeConcini and Riegle not until 1994.

MS. HUNTER-GAULT: Tomorrow Charles Keating testifies for the first time before the House Banking Committee. CONVERSATION - DOUBLE SPEAK

MR. LEHRER: Finally tonight a conversation with a man on a crusade against Doublespeak. He is Rutgers University Prof. William Lutz. Robert MacNeil spoke to him recently.

MR. MacNeil: Doublespeak is a combination of George Orwell's concepts of doublethink and newspeak. It describes language that pretends to communicate but really doesn't. Lutz edits a Quarterly Review of Doublespeak. He and a committee of English professors sponsored by the National Council of Teachers of English collect examples of doublespeak from all over the world. They point out advertisers who boast of "genuine imitation leather", used car dealers who sell "pre-owned cars" or politicians who talk about "revenue enhancement" rather than raising taxes. Lutz finds many examples of doublespeak in the military where the word "peacekeeper" describes a nuclear missile, or where the term "pre- drawn vertical insertion" was used by the Pentagon to describe the U.S. invasion of Grenada. Lutz has also cited the great communicator, himself. When Ronald Reagan was asked at a press conference in 1987 whether his subordinates were acting on his authority in the Iran-Contra affair, Lutz says he responded in doublespeak.

PRES. REAGAN: [March 19, 1987] I don't know. I only know that that's why I have said repeatedly that I want to find out, I want to get to the bottom of this and find out all that has happened, and so far, I've told you all that I know, and you know the truth of the matter is for quite some long time, all that you knew was what I'd told you.

MR. MacNeil: Lutz, who has just written a book on the topic of doublespeak ["Doublespeak"], each year announces an ironic doublespeak award to an individual or organization for egregiously mangling the language. Oliver North is a past recipient for his testimony before the Iran-Contra Committee.

OLIVER NORTH: [July 7, 1987] I was provided with additional input that was radically different from the truth. I assisted in furthering that version.

MR. MacNeil: This year the first place award went to the Exxon Corporation which claimed that almost 35 miles of beaches in Alaska were environmentally clean, because clean according to a company spokesman doesn't mean that every oil stain is off every rock. Prof. Lutz, how do you define doublespeak?

WILLIAM LUTZ, Author: Doublespeak is language which pretends to communicate, language which misleads, misrepresents, avoid responsibility, tries to make the bad look good, or at least tolerable.

MR. MacNeil: And you have different categories of that?

PROF. LUTZ: Well, in an attempt to deal with that, there's four kinds. There's the euphemism, trying to make something sound better than it is; the State Department calling killing unlawful or arbitrary deprivation of life.

MR. MacNeil: Or calling a toilet a powder room or something like that.

PROF. LUTZ: Yes. And then there's jargon, and my favorite example of jargon is "involuntary conversion" which is a legal term and it was used by an airline to describe the crash of an airliner, an involuntary conversion of a 727, which is a nice way of saying the plane crashed. Then there's gobbledegook which I think we just saw an example of there, where you just end up saying, what did he say; you don't know what the speaker says. And then finally there's inflated language that tries to make something more important than it is or something ordinary seem extraordinary. A good example, my favorite, job titles are good for this; elevator operators at a hospital in Philadelphia are called Members of the Vertical Transportation Corps.

MR. MacNeil: How does Exxon win this award by talking about environmentally clean? Where does that fit? Is that jargon? Or what is that? Is that evasion of the truth? What is it?

PROF. LUTZ: I would say that it's a redefinition of the term. And what it really is, it's a form of euphemism that they're trying to say -- notice that they have redefined the word "clean". There was, by the way, a great editorial cartoon in the Dayton, Ohio Newspaper with a little boy standing in front of his room, which is a total mess, saying to his mother, "But my room is clean according to Exxon standards." And if you were to do dishes or clean your house according to the standards of Exxon, you wouldn't call it clean. What they've done is taken an ordinary word, which we all understand, and redefined it to suit their purposes.

MR. MacNeil: But didn't it have a meaning that it was environmentally clean because creatures which lived there could continue to live there with the state of cleanliness they'd achieved?

PROF. LUTZ: Well, if they adapt to oil, I think they'll do real well because the description of the beaches that we saw both visually and in newspapers showed oil floating on the top. The rocks and the sand on the beach are black with oil still. Now I don't know, I'm not that much of a naturalist, but I haven't seen too many fish or any form of aquatic life, or wild animal life that readily adapts to oil covered land and oil covered water.

MR. MacNeil: Your runner-up this year was the Bush campaign comments on its responsibility for the famous Willie Horton ad in the 1988 election. Tell us about why it is a runner-up.

PROF. LUTZ: There are two things to remember. First, there were two Willie Horton ads, one by the Bush campaign, the other by an independent Political Action Committee. And the second thing is that the Bush campaign, although appearing to deny responsibility or denouncing the second, the PAC Campaign Horton ad, did very little to stop it when they could have stopped it. That's the Willie Horton ad that shows Willie Horton with the police mug shot, I mean, the glowering Willie Horton, and that powerful commercial which was produced independently. However, the group which produced that sent a telegram to James Baker offering to --

MR. MacNeil: Who was then the campaign manager.

PROF. LUTZ: Who was then the campaign manager -- saying we will not run this campaign if you object. Well, it ran for 25 days before Mr. Baker bothered to respond. People in the campaign were quoted as saying that, we heard that officially they denounced us, unofficially they're delighted.

MR. MacNeil: Where was the doublespeak?

PROF. LUTZ: The doublespeak was in putting out a public pretense of denouncing it, while doing nothing to stop it, so that your private actions do not match your public speech. It's sort of like saying I'm totally against a tax increase, while promoting revenue enhancement.

MR. MacNeil: Your second runner-up, the third in the line this year, was James Watt, the former Secretary of the Interior testifying before the committee that's investigating the HUD scandal. And we have that quote on video tape here.

REP. TED WEISS, [D] New York: [June 9] So as much as you dislike the term, itself, since it is a part of American language, would you give us your definition of "influence peddling". JAMES WATT: I only see it used and have only used it in a partisan attack. It's when one of the Republican Party or Democrat Party accuses someone else of using his credibility or whatever --

REP. WEISS: Right. JAMES WATT: -- to gain an objective.

REP. WEISS: And you believe that it exists, do you not?

MR. WATT: Of course.

REP. WEISS: In our society. And within the context of that definition, given how you described your work, wouldn't you say that your work, in fact, fits that definition?

MR. WATT: My credibility was used to get a result.

REP. WEISS: Right. Therefore, you engaged in influence peddling.

MR. WATT: If I were a Democrat, I would say that Jim Watt engaged in influence peddling.

REP. WEISS: And if you were an objective Republican, would you also believe that that was so?

MR. WATT: No. I would say there's a skilled, talented man who used his credibility to accomplish an objective.

REP. WEISS: Morally. Morally and ethically.

MR. WATT: That by definition is also there.

MR. MacNeil: So was that doublespeak or was that defining doublespeak for us?

PROF. LUTZ: Well, it both defines and is doublespeak, and that's the scariest kind. In George Orwell's essay, "Politics and the English Language", he points out that thousands of people are driven from their homes when their villages are bombed. This is called "a rectification of frontiers". People are put against the wall and shot; that's called "elimination of unreliable elements". So words that we use to describe events are extremely important. And the word and the fact have to line up in some way. Is it murder or is it merely "elimination with extreme prejudice", as the CIA called it? That becomes very important in how we define words and how we use them. What Jim Watt was showing us there is, I'll simply define the words the way I want to use them, and that way lies chaos.

MR. MacNeil: It seems that over the years, probably because your awards have coincided with a decade of Republican administrations in Washington, but many, almost all your targets are Republican. So is your crusade a political crusade, or is it a linguistic crusade?

PROF. LUTZ: It is a linguistic crusade. I've been asked this question many times before, particularly by readers. We restrict the Doublespeak Award to American public figures who use language with a pernicious, social or economic or political influence. So they have to be people in the public domain, they have to be people in positions of authority.

MR. MacNeil: And Democrats don't do that?

PROF. LUTZ: They haven't been elected to the Presidency recently if anybody's noticed. We have cited Ted Kennedy. I've just cited Bill Bradley in an upcoming issue of the Quarterly Review and a few other Democratic Senators.

MR. MacNeil: What did Bill Bradley say?

PROF. LUTZ: Bill Bradley was one of the -- he took a trip to Switzerland for $1,100 that was tax free because of an obscure provision that the Senate deftly inserted in the last tax reform bill that allows campaign funds to be spent for non-campaign expenses tax free, and Bill Bradley, the champion of fairness in taxation, took advantage of that little tax loophole for himself.

MR. MacNeil: Where is the doublespeak though?

PROF. LUTZ: The actions are not consistent with the words. The words and actions must align. If this is tax reform, I didn't see my Senator, since I live in New Jersey, fighting to plug that loophole.

MR. MacNeil: Is this a particularly American or peculiarly American phenomenon?

PROF. LUTZ: No. In my book, I've got an entire chapter on foreign doublespeak. I have to be very careful with foreign doublespeak, because if it's in the original language, I have to have an official translation. So anything from Russia that I cite I always take the official translation, from Chernobyl, for example, the examples I have from there. I love North Korea, by the way, which has no prisons, just re-education centers. They have no prisoners; they just have some mental illness patients. I have an entire section on Japanese doublespeak, political doublespeak in Japan, England, Canada, I find it all over.

MR. MacNeil: So Americans aren't, American public officials and advertisers and everybody else are not any more inclined towards doublespeak than anybody else. You think, is it a 20th century phenomenon, what is it?

PROF. LUTZ: Oh, no. You can start with Caesar and pacifying Gaulle and what he meant by pacify. Through Thecidices in his histories of the Peloponnesian War talks about how language was perverted at the time in Greece. It is inherent in language because language is the most powerful thing the human race has invented. It is the most powerful tool. The measure and the tool of oppression in "1984", George Orwell's novel, is language. It's not the thought police. With language we can control and manipulate thoughts and we control and manipulate values and ideas and people.

MR. MacNeil: The Thecidices quote was very good and I can't quote it now, but it was about people who were heroes who were willing to take very aggressive action.

PROF. LUTZ: Yes.

MR. MacNeil: And people were more patriotic.

PROF. LUTZ: It was during the time of the Civil War and the repression, the brutal repression by the tyrants who took over, the 30 who took over and slaughtered thousands of people in Athens at the time. If you did not side with them you were unpatriotic. If you did not turn in someone to be killed, you were called a traitor. Patriotism was not supporting the city state. Patriotism was going against the tyrants. It was the most perverse kind of language that we seen. And we've seen that under Stalin, we've seen that in China. We've seen that in South Africa. We've seen that with Idi Amin calling his secret police the state research unit. It's all over the world, because leaders who rise to power understand the power of language and they are very good at it. They are very sophisticated and very sensitive to the use of language.

MR. MacNeil: Coming away from leaders and going into society generally, is there, what does it say about modern society, in so many other walks of life we want to practice a level of gentle deceit in the way we describe things? Is there anything significant about that, or has it just always been that way?

PROF. LUTZ: Well, that level of the euphemism, the euphemism exists for that reason. A euphemism functions in any culture to allow that culture to talk about subjects which are taboo or sensitive. Death for example. We use euphemisms about death not to mislead but out of sensitivities in a cultural taboo, but when you take a euphemism --

MR. MacNeil: That doesn't describe genuine imitation leather.

PROF. LUTZ: No. You see, now there, that's an attempt to mislead. How about real virgin vinyl, real counterfeit diamonds, a purse made out of fake leather? Now we have a new fake diamond called diamond essence. It just keeps coming. That is a euphemism used with intent to mislead. In New York, there is a bill in the state legislature dealing with post secondary consumer materials. It's a bill dealing with garbage. The U.S. Army doesn't call it killing the enemy more in basic training. It's servicing the target.

MR. MacNeil: Do you and the National Council Teachers of English which backs you, do they feel and you that your annual award and the publicity is doing any good, that there is any less doublespeak as a result?

PROF. LUTZ: It's certainly not any less. It's in a flood and by flood I mean this literally. I'm talking about walking angle deep in my study at home through piles of clippings of doublespeak. However, I think we're achieving two things. One, the award is merely symbolic to draw attention to this misuse of language. Secondly, I'm amazed at how many people are very sensitive to and aware of this misuse. They just don't know what to do about it. So in that sense we're making progress by putting a spotlight on it. We got rid of revenue enhancement when people simply started laughing at the term and the government dropped it. Now we can just start working on the thousands of other examples.

MR. MacNeil: Prof. Lutz, thank you for joining us.

PROF. LUTZ: Thank you. RECAP

MS. HUNTER-GAULT: Once again, Monday's top stories, more than 200,000 people marched through the streets of Prague, Czechoslovakia, the largest protest ever against that hardline Communist Government. In another East Bloc nation, the president of Romania rejected calls for democratic reform in his country, and the House of Representatives defeated an attempt to place restrictions on U.S. aid to El Salvador. Good night, Jim.

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