The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight, we summarize what happened today in New York and Washington, Afghanistan and Pakistan; talk about the economy with Treasury Secretary O'Neill; look at coalitions and response options with former Senators George Mitchell, Gary Hart, Connie Mack, and Gordon Humphrey; and listen to the thoughts of a group of citizens in Denver.

AMERICA RESPONDS

JIM LEHRER: President Bush said today last week's hijacked airliner attacks have caused a shock to the economy. He met with House and Senate leaders to discuss the problem. He said he would address a joint session of Congress tomorrow night to explain what the government plans to do. Earlier, at a House hearing, the major airlines appealed for more than $ 17 billion in federal aid. This afternoon, American Airlines announced it would cut at least 20,000 jobs. Six other carriers also plan layoffs. Last night, Boeing said its commercial aircraft business would eliminate up to 30,000 jobs. On Wall Street, the Dow Jones Industrial Average lost another 144 points, to close at 8759. The NASDAQ dropped 27 points, to end at 1527. There were new moves by the U.S. Military. The aircraft carrier "Roosevelt" sailed from Norfolk, Virginia. A reported 100 combat aircraft were ordered to begin moving to the Persian Gulf area. On the diplomatic front, the President urged world leaders to join the war on terrorism, openly or secretly. He spoke at a White House meeting with the President of Indonesia, one of a series of talks with foreign officials. He said he realizes some want a more active role than others in fighting terrorism. He also demanded again that Afghanistan surrender Osama bin Laden and his top lieutenants. The spiritual leader of Afghanistan offered to hold talks with the United States, but a White House spokesman responded, "it's time for action, not negotiations." In the investigation, Attorney General Ashcroft toured the damaged Pentagon and said it was pretty clear foreign governments had aided the terrorists. He did not identify the countries involved in the attacks that killed some 6,000 people. The FBI said it arrested three men in Detroit with false identification papers and notes on a U.S. Air base in Turkey. The Treasury Department unveiled plans to target money laundering by terrorists.

FOCUS - ECONOMIC AFTERMATH

JIM LEHRER: Now to some of the details: In Washington today, Congress began to address some of the economic fallout from last week's attack. Kwame Holman reports.

KWAME HOLMAN: Concern about the state of the economy brought Federal Reserve Chairman Alan Greenspan and former Treasury Secretary Robert Rubin to the Capitol this afternoon for a closed meeting with the four top leaders of Congress.

REPORTER: Mr. Speaker, what do you hope to accomplish at this meeting?

REP. DENNIS HASTERT: I think we'll have comments later this afternoon, thank you.

KWAME HOLMAN: A Federal Reserve report today described the economy as "sluggish," adding consumer spending was flat to down, and there has been no significant boost from the income tax cut. At the same time, the House Transportation Committee was hearing from airline executives that the one-tenth of the U.S. economy their industry represents is in danger of collapse because of lost revenue after last week's attacks. They pushed a scaled-back request for an immediate federal infusion of $ 5 billion, plus $ 12.5 billion in loan guarantees. Leo Mullin is chairman and CEO of Delta Airlines.

LEO MULLIN, Chairman & CEO, Delta Airlines: Our proposal is only intended to stabilize the financial condition of this industry. It is not a bailout, but rather a package designed solely to recover the damages associated with the heinous acts of September 11, and it gives the airlines a chance to continue to serve as the economic engine and offer the public service it is our duty to provide.

KWAME HOLMAN: Teamsters Union President James Hoffa argued for aid for the 51,000 airline employees already laid off before this afternoon's announcement by American Airlines that it would lay off 20,000 more.

JAMES HOFFA: There has to be an equality of sacrifice in any program we come up with. Everybody should have to tighten their belts with regard to what we're going to be doing with regard to this crisis. That could take the form of longer-term unemployment benefits, and job placement and job training for those who have been displaced.

KWAME HOLMAN: Committee members generally agreed immediate assistance for the airline industry is warranted. But the committee's top democrat, James Oberstar, said that alone won't be enough to get the airlines off the ground.

REP. JAMES OBERSTAR, (D) Minnesota: But if we address only the dire financial circumstances of the industry and do not at the same time elevate security, air travelers will have little confidence that they can fly safely, and airline load factors will not improve.

KWAME HOLMAN: A financial rescue bill for the airlines could be ready for a congressional vote by the end of the week. Late this afternoon, President Bush hosted the congressional leaders in the Oval Office. The President said this about the economy.

PRESIDENT GEORGE W. BUSH: And I'm going to work with Congress to send a clear message to America, American workers, American business people, that this government will respond to this emergency. We'll respond to the emergency in terms of working on a package for the airline industry that has been severely affected. We'll respond to work to fight terrorism. The definition of "how much?" is: Enough to get America going again, is to be able to endure this emergency.

KWAME HOLMAN: Leaving the White House, congressional leaders said they'll wait for a detailed presidential request regarding any new economic stimulus package.

FOCUS- NEW YORK DAY

JIM LEHRER: The day in New York. Betty Ann Bowser has that.

BETTY ANN BOWSER: New York City officials today continued to call efforts at the World Trade Center site a rescue and recovery mission. 15 must bodies have been found, 18 more victims have been identified. But more than 5, 400 people are still missing. Late this morning members of the public were allowed to get even closer to what's left of the World Trade Center. Even though it's been more than a week since anyone has been found alive, they stood on Maiden Lane just one block away and stared in disbelief. Some snapped pictures; some just looked up. At the other end of made Maiden Lane National Guardsmen stood watch while the sound of patriotic music blared from a speaker. And in between the two end of the street there was a business world of uncertainty. Almost everyone on this tiny downtown block made their living from the tens of thousands of people who worked in the World Trade Center. Now most are closed. White ash is everywhere and when the UPS truck comes to deliver, sometimes there is no one there to receive it. A few hundred yards away from the site the Health Exchange Restaurant delivered more than 1,000 meals a week to clients in the twin towers: Corporate accounts like Cantor Fitzgerald, Dean Witter. The owners are still trying to wash await mess hoping to reopen soon. But they're worried about losses.

MARCELLO ADUGO, Restaurant Owner: In product alone it must have been over $ 10,000. We're coming up with a list for the insurance company -- it's going to be over-- it's probably more than what we're covered for.

ALEX FERKOV, Restaurant Owner: It's not only that, but we have rent to pay, utilities we have to pay, loans we have to pay and on and on and on. And we have to look into all of that, you know, what's covered, we have to talk to the building see what they'll do about the rent. Obviously we can't pay the same rent as we were paying before because our customer base isn't there.

ALEX FERKOV: All of this will go out.

BETTY ANN BOWSER: After 13 years in business Alex and his partner finished a half million expansion and now they're trying to figure out how it pay that money back.

MARCELLO ADUGO: We have too much money invested and can't go anywhere else and walk away from it because the place wasn't physically damaged; the building is not condemned. So we have no choice.

FRANK SALERNO: Sugar in the coffee?

BETTY ANN BOWSER: A few doors down on Maiden Lane Frank Salerno was open again for business. But the clientele has changed -- no longer businessmen in suits. Today it was construction workers, police, firemen. And Salerno had some heady challenges getting the restaurant back in business.

FRANK SALERNO: Couldn't even drive in. I would come in with five, six dozen bagels, bialys and stuff, on a train, walk it from the subway station to here and set up and try and get ready. We took ten gallons of milk in two suitcases on the train with us because we couldn't get anything in.

BETTY ANN BOWSER: And like all of the other small business owners on Maiden Lane Salerno is taking things one day at a time.

FRANK SALERNO: Who knows what will happen tomorrow? I mean this morning they closed off Nassau Street for a while because of a suspicious car down the block, so who knows? We're open today; we might not be open tomorrow.

BETTY ANN BOWSER: Hundreds of people passed through Maiden Lane today. And there was no uncertainty about the messages that they left behind.

NEWSMAKER

JIM LEHRER: Now, a Newsmaker interview with the Secretary of the Treasury, Paul O'Neill.

Mr. Secretary, welcome.

PAUL O'NEILL: Thank you.

JIM LEHRER: The President said there has been a shock to the economy. Give us a feel for the magnitude of that shock now as it looks over a week later.

PAUL O'NEILL: Well, Jim, I think we don't really know yet how long, how big the shock is going to be or how long it's going to last. If you look at ground zero, which I had an opportunity to do on Monday, the emotional feeling that one has in seeing that close and not you through the eyes of television it's just overwhelming. And there is just no doubt that the devastation there is complete and total and what your tape was showing you for individual business, a very real thing. But when you think about the rest of America and you think about the crops growing in the fields and people going to... back to work as the President said this last Monday, and doing their work and providing goods and services to each other, I think that the direct damage to the American economy is isolated in the sense of ground zero, is isolated there, and it's obviously severe and in a human sense really compelling. In a ten trillion dollar economy we have got a lot of other activity going on. I think the base question that we have got to deal with here, because economically there is so much about expectations and confidence, how quickly we recover our sense of emotion, I think on September 10 we were beginning to move out of a very low level of economic growth and now what we have got to do is assess what else we might do and need to do in order to get ourselves moving back on that growth path, Jim.

JIM LEHRER: Well, one of the measurements, of course, is the stock market. It was down another 144 points today. Does that concern you?

PAUL O'NEILL: I would like for it to go up every day. And of course I don't like it going down 144 points. But earlier in the day it was down 400. In the last half hour of the market today the Dow Jones Industrial Average recovered over 200 points. So I think the important thing, most important thing about the market is, the U.S. exchanges are operating. It is a phenomenal thing that the people involved in making markets were... when they were at ground zero were able to recover in a short period of time. It's a huge victory over the terrorists. Now, where should we be in terms of what we would like to see for levels in the stock market? Everyone anticipated we were going to have a runoff of maybe as much as 10%; Monday was only minus 7%. Today was minus 144 points. Tomorrow may bring something better. But I think what's important is the long-term resiliency of the American economy is there and I said the other day, I should not as a regular practice make forecasts but I believe our economy is so strong compared to all of the other economies in the world, the American people are such a great people and we know how it create productivity, we will have new highs in our market indices in the foreseeable future.

JIM LEHRER: How important should the average American, you're talking about confidence and whatever, how important should the average American feel the stock market is to the recovery, to our getting over the shock?

PAUL O'NEILL: Well I'll tell you, these days even though some Americans may not know it they are investors in America through company pension funds and the 401 k's and all the rest of that and 70 or 80% of us have some wealth tied up in the stock market and so we should all care about it. We all contribute....

JIM LEHRER: So it's important?

PAUL O'NEILL: Absolutely, because we all contribute to the reason for it. And it's an index over time of how well we're doing as a country. We have been doing well, we will do well again; we will grow faster again and we will do it soon.

JIM LEHRER: The airline industry, America Airlines, 20,000 layoffs today, I read something just a moment ago, they expect 100,000 people total in the airline industry to be laid off; that doesn't count the 30,000 from Boeing and other manufacturing companies that are being hit here. What is the federal government prepared to do to help these people?

PAUL O'NEILL: It's a subject we are been working on the last several days. I think we need to work against a set of principles in all the sectors that we need to be concerned about, and the airlines industry is not the only one, we need to first start with what's the immediate need -- the airlines need cash. They need liquidity; we should give them liquidity and we should do it quickly.

JIM LEHRER: Give them money and loan guarantees -- whatever?

PAUL O'NEILL: Money.

JIM LEHRER: Money.

PAUL O'NEILL: I think we shouldn't fool around and we shouldn't do things that complicate the issue. If they need money, we should give them money. At the end of the day a loan guarantee is a substitute for money. We ought to give them money and we need to figure out a way that gives them money without making them prosperous independent of this tragedy that's happened to them and to the rest of the country. So we need to give them money...

JIM LEHRER: In other words, compensate for what they're losing as a result of the tragedy -

PAUL O'NEILL: Right.

JIM LEHRER: -- but for nothing else?

PAUL O'NEILL: Well, no - no -

JIM LEHRER: No?

PAUL O'NEILL: -- there are some other things we need to do. I believe we need to socialize the cost safety and by that I mean, we, the people of the United States, need to pay for a secure system of safety for airports and airliners, so that we can all rest easily. And when we when we get on a plane, we know we're going where we intended to go and we're not going to get hijacked. And I think we should effectively tackle ourselves to provide security for air transportation in this country; we should do the same for air marshals. And there is another thing we need to do: We need to accept as a societal burden the insurance cost of terrorism. So we shouldn't expect the airlines to suffer the cost, which is enormous in its potential, for acts of terrorism; we need to accept that cost, including those costs associated with terrorism that happened last week.

JIM LEHRER: So we're talking, the airlines asked today for $ 17 billion. That sounds cheap laying out what you just said?

PAUL O'NEILL: Well, I don't think so. You know, I think...

JIM LEHRER: I don't mean cheap. I mean, it sounds that $ 17 (billion) may not pay for everything you outlined?

PAUL O'NEILL: Well, I don't think so, Jim. I think maybe we can do this for less than what the "ask" is at the beginning. But I think in all of these things we should operate from principles and what the principles produce in terms of a bill, that's what we should do. I don't think we should... we shouldn't decide that we're not going to have complete safety because it's costs too much and we shouldn't decide is that we're not going to give the airlines cash liquidity in the short-term because it costs too much.

JIM LEHRER: All right. Beyond the airline industry, the President is going to address the Congress tomorrow and the nation tomorrow night, lay out some, I guess a stimulus package, is that right, that goes beyond the airline industry?

PAUL O'NEILL: Well, I don't know. You know what, one of the things that my good friend, Alan Greenspan, and I have been talking about is, we think we need to assess where the economy is and how it feels for a little bit of time and see what kind of data we're getting before we lurch off into a massive stimulus program. Right now there is an energy to go and take action, and the kind of things we need to look at, we need to talk to people who run major credit card businesses and find out what the level of activity is. I had a little conversation today with one of the major people, and they told me a week after the terrible events, their credit card activity is running about 20% lower than it was at this time last year. Now we need to watch over the next week or ten days, or two weeks, and see if there is a recovery and people go back to normal spending patterns and the rest and assess how much stimulus we need. I think we should not rush to judgment about these important issues, because the arguments we were having a few weeks ago about not overspending, still have a validity. We need to be balanced and careful about the decisions we make for those things that are immediate, like airline liquidity, we need to do it right now. For things that should take little bit more judgment we need to be careful.

JIM LEHRER: So, in a nutshell, if people are expecting the President of the United States to lay out some detailed economic stimulus package tomorrow night, they're going to be disappointed?

PAUL O'NEILL: Well I wouldn't say that. You know the President is a free agent and I think he values my advice, but he takes his own. And so what he says tomorrow night I think we'll all be interested in looking at. And a suspect that he will lay out maybe some principles of what we should be thinking about in the event there is a decision made that we need to have a substantial stimulus. And I must say I have some ideas of my own -- how would I craft a stimulus program -- which I'm not going to tell you.

JIM LEHRER: So I shouldn't ask, right?

PAUL O'NEILL: No, no, please don't ask because I'm not going to tell you about it. But of course there are some things that could make a difference that would really provide stimulus in the event that we need to pop more money out.

JIM LEHRER: But the President hasn't asked you for your ideas yet?

PAUL O'NEILL: Oh, yes, indeed, but I'm not going yes indeed but I'm not going to reveal them here, Jim.

JIM LEHRER: Whether your ideas or somebody else's ideas, does kind of tax relief - cutting capital gains taxes or payroll taxes?

PAUL O'NEILL: Let's look at the principles of where we are. Up to this period through this year our economy has been running at a lower rate than we would like -- not because of weakness in the consumer sector. Consumers have been doing well. Housing starts have been run inning at a very good level. Automobile sales have been running at a very good level. The weakness in our economy this year has been on the investment side. Companies have not been investing at the rates that they were in the last four or five years. And so the weakness in our economy has been on the investment side -- not on the consumer spending side. And soif you work from a set of principles, you ask yourself the question, what is it that we could do that would add to the investment side of our economic equation? And there are a variety of ways that one can think about that problem. And so I think, again, we need to work from principles. You know, there are advocates of a whole host of things that are so familiar they almost are not worth talking about. And I think one of things, again, we need to be careful in this circumstance, is that we not try out everybody's favorite idea which they've been trying to get enacted for the last 50 years and it gets swept into the vanguard of now is our chance. And we need to be careful about what we do.

JIM LEHRER: Finally, Mr. Secretary, the Treasury Department is involved in tracing money.

PAUL O'NEILL: Yes.

JIM LEHRER: And some new measures were announced by your Department about trying to find the money of terrorists including Osama bin Laden's. What's the most dramatic thing you're going to do differently now?

PAUL O'NEILL: Now we're going to do several important things, Jim. The first thing we're going to do, which we have need to do for a long time, is we're going to take the handcuffs off ourselves so that we have an ability to use the information sources of the nation security agency and the CIA and the FBI and all of the other law enforcement agencies, include those of the Treasury Department, which include Customs and Alcohol Tobacco and Firearms officers, and we're going to collect a list and are already in the process of collecting a word-wide list of known terrorists and suspected terrorists, and we're going to go after them in every possible way we can with the information sources that are available to identify the connections they have with financial markets, with telephone companies, with credit card companies, and systematically take their financial means away from them.

JIM LEHRER: I know you're new to the job. It's a difficult question, but as a result of what happened on September 11, and you know reviewing what the Treasury Department was doing, were you disappointed in what you found in this area?

PAUL O'NEILL: No... Well I'll tell you what, for the last 15 maybe even 25 years, this nation has had a program aimed at so-called money laundering, which is trying to get at evildoers who are moving cash around the world economy. And there has been an enormous amount of activity upwards of $ 700 million a year spent on this subject. And when I began asking the question of what have we gotten for the money we spent, I must say I was very disappointed that over this 25 year period of time, there's one famous case that produced a significant amount of money that was caught. And I think, you know, this is a general point, that too often there is an acceptance of activity for progress. And I believe we should not tolerate that in peacetime or in wartime. We should insist that we get value for money spent. And I think there is no doubt we're going to do that now. And it's importantly going to be possible do it, because we're going to stop the idea that we can't use all of our assets, because we can't chase people into their rat holes and get them because of their civil liberties.

JIM LEHRER: So some civil liberties are going to have to go by the board?

PAUL O'NEILL: Well, I think for those people who are known terrorists, we shouldn't grant them the use of our civil liberties to extend their, their petulance, if you will.

JIM LEHRER: All right. Mr. Secretary, thank you very much.

PAUL O'NEILL: Good to be with you.

FOCUS - DIPLOMATIC PUSH

JIM LEHRER: Still to come on the NewsHour tonight, working on the U.S. response, and a discussion in Denver. The United States has called for Afghanistan to hand over terrorist leader Osama bin Laden. We have a report on the situation in Afghanistan and Pakistan from Ian Williams of Independent Television News.

IAN WILLIAMS: As top clerics gathered in Kabul this morning there seemed little prospect of them handing over Osama bin Laden the man the Taliban calls their guest. The dwindling Kabul population has been told to prepare for a holy war and in a message to the clerics the Taliban's supreme leader accused Washington of using Osama s a pretext to attack Afghanistan -- hardly encouraging for Pakistan's President, as he addressed his nation tonight.

PRESIDENT PERVEZ MUSHARRAF Pakistan: (speaking through interpreter) Pakistan is facing the most difficult period in its recent history. Its decision will have a profound impact on our future. If we make a mistake, it will do us enormous harm.

IAN WILLIAMS: And he said the country was on a high state of alert.

PRESIDENT PERVEZ MUSHARRAF: (speaking through interpreter) The Pakistan army and all of our people are ready to defend the integrity of our country. Nobody should be in any doubt. Right now our air force is on high alert and they are ready for a do or die mission.

IAN WILLIAMS: In spite of growing protests -- this on the streets of Karachi today -- the President said most people supported his decision to assist the United States. He appealed for wisdom over emotion. There were also signs the authorities are growing impatient with their hard line critics, many of whom have close links to the Taliban.

SAMI-UL-HAQ, Defense Council, Afghanistan: (speaking through interpreter) The Taliban refused to hand him over. But no nation or country will hand over a person just on the basis of accusations. They want evidence. They can only take action on the basis of evidence but they say none is being given.

IAN WILLIAMS: We had a glimpse of Pakistan's heightened readiness en route to the border today. Troops were on the move. Local journalists who have been working both sides of the border talked of a big arms buildup.

ABDULLAH JAN, Journalist: The villagers told me that the army men were pulling up heavy guns and cannons to these mountains.

IAN WILLIAMS: And as for the Taliban...

ABDULLAH JAN: Three days back I saw the antiaircraft guns they have installed on the cliffs on the other side of the border, the small ones, antiaircraft guns. And people coming from Jallalabad said that they also witnessed a movement of tanks and army - military - on the road.

IAN WILLIAMS: In Islamabad today a memorial service at the American embassy - and strong words of encouragement for the Pakistan President on whom Washington has been applying intense pressure.

WENDY CHAMBERLIN, U.S. Ambassador to Pakistan: He has been enormously supportive of us, the United States in a period when we have come to him with certain requests, because of the very grave events that occurred on our soil.

IAN WILLIAMS: While at the nearby British mission diplomats tonight say they're advising all dependents and nonessential staff to leave Pakistan.

JIM LEHRER: In Washington, there was a full day of diplomatic activity. Terence Smith reports.

TERENCE SMITH: Today, President Bush began his coalition-building efforts by welcoming President Megawati Sukarnoputri of Indonesia, the world's largest Muslim country. He told reporters that the United States is gathering evidence about the terrorists to make its case to the world.

PRESIDENT GEORGE W. BUSH: This is a campaign in which nations will contribute in a variety of ways. Some nations will be willing to join in a very overt way. Other nations will be willing to join by sharing information and information in a campaign such as this is going to be incredibly important. It's very important for us to be able to find where these people are. There's going to need to be a campaign... There needs to be a financial component of the campaign where we need to cooperate to make sure we cut off funds, find out... Find these organizations that serve as front groups for funding these terrorist cells.

TERENCE SMITH: Also at the White House this morning, Mr. Bush spoke by phone with the Presidents of South Korea and South Africa, seeking their support. Around midday, Secretary of State Collin Powell met with his Russian counterpart, Foreign Minister Igor Ivanov.

COIN POWELL: We spoke about terrorism at considerable length. I was very pleased to receive from the minister expressions of condolences for those who lost their life at the World Trade Center and the Pentagon last week. Deputy Secretary Armitage called me from Moscow this morning to also tell me what it was like in Moscow to have Russians citizens coming by our embassy to place flowers and candles and otherwise remember those who lost lives.

IGOR IVANOV, Foreign Minister, Russia: (speaking through interpreter) The international terrorism have caused a blatant challenge to all civilized humanity. (speaking through interpreter) This reaffirms once again the necessity to join efforts of the entire international community to fight against new challenges and threats, including in the first place the threat of international terrorism.

TERENCE SMITH: Late in the afternoon, the administration received, as expected, similar words of support from Germany's Foreign Minister, Joschka Fischer.

JOSCHKA FISCHER, Foreign Minister, Germany: We are in full solidarity with the American people. This is not only a rational or a political question; this comes from the deepest of our hearts.

TERENCE SMITH: Early this evening, President Bush pointed to yesterday's proposed cease-fire in the Middle East, saying it was a positive development that had come out of last week's tragedy.

PRESIDENT GEORGE W. BUSH: I'm pleased with the fact that Chairman Arafat and Prime Minister Sharon have taken positive steps toward bringing peace to the region. I think we have an opportunity to refashion the thinking and... Between Pakistan and India. I think there's some interesting opportunities to shake terrorism loose from sponsor states.

TERENCE SMITH: The President said he would provide more details on what he called the battle to maintain freedom in his address to the joint session of Congress tomorrow night.

FOCUS - AMERICA RESPONDS

JIM LEHRER: But this evening National Security Advisor Condoleezza Rice said the President would not use his speech to announce military action. Instead she said he would talk about the long struggle ahead. Margaret Warner takes it from there.

MARGARET WARNER: I am joined by four former Senators with long experience in foreign policy and intelligence matters. Democrat George Mitchell was Senate Majority Leader from 1989 until 1995. Last year he chaired an international commission that produced a blueprint for resolving the Israeli-Palestinian crisis. Democrat Gary Hart was a member of the Senate Armed Services Committee and the Intelligence Committee until retiring from the Senate in 1987. Most recently, he co-chaired a commission that earlier this year warned of an increasing threat of terrorist attacks in the United States. Republican Connie Mack served on the Senate Intelligence Committee until his retirement last year. And Republican Gordon Humphrey, who left the Senate in 1991, was a member of the Foreign Relations Committee and its terrorism subcommittee. He founded the Senate Afghan task force to support the Mujahadeen rebels against the Soviets in Afghanistan.

Welcome, gentlemen. Senator Humphrey, starting with you, you know Afghanistan better than anyone else I think on this panel or myself. Today the Taliban suggested that it would like to talk to the United States about surrendering Osama bin Laden. The White House response was: Forget about talking -- turn him over or else. Do you think the United States should talk with the Taliban before leading a coalition into some sort of military action?

FORMER SEN. GORDON HUMPHREY: Well I don't -- not this early in any event. It could be a trap. They could be out simply to humiliate us. They're the most unreasonable group in that part of world. I don't think we should. I think instead we should prevail upon our erstwhile ally, Pakistan, to act as an intermediary and that seems to be moving forward. I think the President is on the right track in that respect and in every respect. I think he's doing a remarkably good job in a measured, calm but determined response to this crisis.

MARGARET WARNER: How do you see it Senator Mitchell, do you think there is any that could forestall the need for military action?

FORMER SEN. GEORGE MITCHELL: Obviously if the government of Afghanistan decides to turn over bin Laden and others that may forestall it for some time but that does not appear likely based upon the reports of the day. I think the important thing that the President and the Secretary of State have done is to make it clear that this action will move in parallel, many nations not just the United States, we can't go it alone on something like this. Secondly, many areas of activity, not just military. That will be a component, but it has to be diplomatic, economic, financial, legal, and other; and building the broadest possible coalition among as many nations as possible based on what they can and are prepared to contribute.

MARGARET WARNER: Senator Mac, I'd like to explore with you -- everyone says it's important to have a coalition for all these various reasons but the question is at what price. For instance the last couple of days several would-be coalition partners -- people the United States would like to include -- have said, for instance, President Mubarak of Egypt, the President of China, that the United States have to come forward first and present irrefutable evidence that say Osama bin Laden and his network were responsible. Today the White House -- both Ari Fleischer and Condi Rice seemed to say - you know -- that isn't our plan. How do you feel about that? Does the United States need is to really lay out a public case?

FORMER SEN. CONNIE MACK: Well, I think it's important that there be a coalition, if possible. But I guess what I would say is, that I think that the United States needs to be prepared to do what it must in order to make those who carried out this horrible act, in fact, are punished for it. It would be helpful to have a coalition. And I would kind of divide it into two areas: I don't think that there is any reason that we should allow another nation to keep us from moving forward on the front to pursue those who created or who attacked the United States. Onthe other hand, long term, it seems to me that it is in the best try of our country to develop as broad a coalition as we can. But I also that I we have to be... President Reagan had a great saying he liked to state over and over again, trust but verify. Any nation who wants to come forward and tell us that they have got information or ways to help us I gradually would accept that. But I do have real reservations about some of those who have indicated that they're prepared to help us and come forward to help us in the development of this coalition. I think we want to see people -- nations act and not just state that they're with us.

MARGARET WARNER: Senator Hart, what's your view of how far we should go to satisfy the - demand is maybe too strong a word - but these sensibilities or considerations of these would-be coalition partners to get them on board?

FORMER SEN. GARY HART: We're trying to do two things at once and we should be doing a third. We're trying to find the people that perpetuated this Satanic act and punish them -- bring them to justice or retribution of some kind. At the same time the President has announced we're trying to root out -- root and branch -- terrorism worldwide. In the first we may have to go it pretty much alone or seek what help we can wherever we can in our determination. The second, I think we do need the broadest coalition possible. I hope it's not just a replication of the Persian Gulf group, our allies in Europe for example and a few others. I think for example, Russia and China could be very helpful to us here. We ought to have a military delegation in Moscow now meeting with the commanders of the Afghan War finding out what to do and also whatnot to do. They have some experience there. The third thing we ought to be doing - it seems to me -- is not focusing so much on the retribution and the punishment that we neglect protection and prevention of the next act. We ought to be concerned that this is not just the beginning of terrorism -- I mean not the end of terrorism; it's the beginning. And if we put all of our effort and all of our energy into punishment and we have another attack because we weren't building up our own defenses at home, then I think that's the worst possible thing that could happen.

MARGARET WARNER: Senator Humphrey back to the beginning of what Senator Hart said about seeing this indifferent parts because the White House seems to be saying that - this too, that is there is this sort of retaliatory action which the administration seems to be saying and Condi Rice just said it half an hour ago - we reserve the right to act in self-defense...period. And then they also want cooperation on all this financial and every other way in getting the network. Some coalition members or people we'd like to have again are trying to set down conditions for the first as a condition for coming in with the second - again, Mubarak, other leaders saying, for instance, don't kill any innocent civilians in the first phase, in a retaliatory phase, and I guess I'm still going back to my original question, which is: to what degree does the administration need to tailor the way is responds in the interests of getting as big a coalition as possible?

FORMER SEN. GORDON HUMPHREY: Well, I think that's necessary. I think it's important that we do a number of things furthermore that we can do unilaterally. There was a discussion about the airline industry a moment ago. We need to reassure airline passengers; we need armed marshals on those airplanes tomorrow. We need to appropriately arm and train cockpit crews. I speak as a former airline pilot, by the way. We need to give them real barriers to trespass in the form stronger cockpit doors. Then we need to in the intermediate term - we need to move out and infiltrate on the model of the Israeli intelligence services -- these terrorist organizations all around the world - we're too Afghan focused here; this is a worldwide phenomenon crisis; we need to infiltrate these groups and frankly we need to take out the leadership when indicated. We're describing this as a war. It is a war. In wars people get killed unfortunately. Better them -- namely these terrorist leaders - than us. So we need to infiltrate these groups and get after that their leadership and break them up. We also need to put together the kind of coalition that President Bush is doing. But I think that the things we can do ourselves frankly are more important in the final success, the final outcome of this war, the final victory in this war against the evil empire of the 21st century, which is terrorism.

MARGARET WARNER: Senator Hart, would you call this the evil empire of the 21st century, terrorism?

FORMER SEN. GARY HART: The phrase hadn't occurred to me but I suppose it's satisfactory, yes. I think to repeat a point, the nature of warfare changed historically on September 11. The distinction between war and crime was eliminated. War is now by conducted by civilians against civilians -- un-uniformed people against un-uniformed people using weapons of mass destruction -- not playing according to the rules of war of the 18th, 19th, and 20th century. Until we begin to adapt to that we're not going to protect this country. We have no organized system of defending this country.

MARGARET WARNER: Senator Mitchell, back and we're jumping a around a lot here, but building a coalition -- some other states setting other kinds of conditions or things they'd like the U.S. to do - one of them for the Arab states is for the U.S. to do more in the Arab-Israeli conflict - the Palestinian-Israeli conflict. There's been some movement on that front. What connection do you see between the Palestinian-Israeli conflict and this war on terrorism?

FORMER SEN. GEORGE MITCHELL: Well it's obviously not exclusively related to that -- but it is a factor. If I could go back to the earlier point just make one additional point, the United States can chew gum and walk at the same time. We can create a coalition in which we bring people along without giving every single country a veto power of what we're going to do. That's the challenge of leadership. It isn't an either/or situation. And I think the President is he going down the right road and can do that successfully. Now, with respect to the Palestinians and Israelis, there is a glimmer of hope and perhaps a moment of opportunity here. When I last met with Chairman Arafat and Prime Minister Sharon, strikingly they both said to me almost exactly the same thing using the same words: this must end because life has become unbearable for our people. And it has become unbearable, and I think both have been looking for a way out of the very difficult circumstance in which they found themselves in which their societies are suffering so terribly. And I think this may create that opportunity. And I'm pleased at least what I hope is the beginnings of a movement toward adopting the recommendations of the report we made in May, and although we all ought to be cautious about Mid East cease-fires -- many of them come and go without taking effect I'm hopeful that this time it will be real.

MARGARET WARNER: And Senator Mack, go back to this question to what degree the United States should, can the United States walk and chew gum at the same time to use Senator Mitchell's phrase -- to what degree should the United States be willing to tailor its response in this matter and in other foreign policies matters to keep a coalition together?

FORMER SEN. CONNIE MACK: Only what it has to. Again, the fundamental point here is that we must act; we can't allow ourselves to be so tangled up by the demands of potential coalition leaders who are making public statements to address problems that they have at home. We cannot allow that kind of language to keep us from what we must do. And I agree, it's what I indicated I think at first, there is really two aspects to this: What do we do initially? What do we do in pursuit of those who we appear to have no question as to their role, how hard do we pursue them? Do we clearly expand those who we are pursuing to those, who, in fact, supported them, that have given them cover, that have aided them financially, provided intelligence information? Again, I think we go back to the basic premise, that those engaged in terror cannot hide. We'll track them down. And we will do that in any way and with whatever means are necessary. But long term, it is to our advantage, obviously, to have as many different nations around the world engaged in support of this effort to eliminate terrorism. But initially I don't see that we should allow ourselves to get tangled up.

MARGARET WARNER: All right. Senator Mack, I'm sorry to interrupt you but our last conversation was actually taped in Denver. We have to leave it there. Thank you former Senators very much.

FINALLY -DENVER VIEWS

JIM LEHRER: Finally tonight, reaction from a group of people in Denver who have joined us before to discuss major news events. And they did indeed speak with Betty Ann Bowser earlier this week.

BETTY ANN BOWSER: September 11, 2001. Is that day going to be, for any of you, like the day that John Kennedy was shot-- that you will always remember where you were, what you were doing?

BRENT NEISER: When I saw the second plane hit, live on morning TV here at Denver time, and to realize this is... Then you knew it was terrorism, the second plane-- at least I felt I did. This is New York Harbor. I had a grandfather that sailed through there on his way to and from World War I. My father did that in the European theater in World War II. That was safe... A safe harbor, safe haven for them. And to me it just... You know, now reflecting from that incident, we have now this generational challenge to make that harbor safe for all Americans, and making it the beacon for democracy that it was.

BETTY ANN BOWSER: Chris, how do you feel right now?

CHRIS GOODWIN: It's been a real hard week. I've sort of a numb feeling in a lot of ways. I think if anything comes out of this whole thing, it has to be that we do things to make sure this kind of thing doesn't happen again. And I think that has to involve a lot of different things, not just pursuing and apprehending the people who did it and make sure there's some kind of justice applied. I think it's going to involve a lot of questions about the policies of our country, and maybe things... Asking questions about what we've done to generate such hatred in the minds of some people. I think it's real easy to write this off as insanity and not think about those things, but I think that would be a big mistake.

BETTY ANN BOWSER: Has this brought out this sense of patriotism that's been described by all the polling around the country?

LINDA HOUSTON: I really do believe that the patriotism is our form of unity; that when we... When we've had other attacks or we've had differences in the communities and in the United States and in politics, that's sort of when we banter. But when somebody hits us from the outside, that's when we unify.

GREG SCOTT: If we don't take this personally and we don't treat this as an attack on America and make it a patriotic issue, we risk just kind of sloughing it aside and moving forward and having this happen some time in the next 12, 18 months all over again.

BETTY ANN BOWSER: Jason, you're one of the youngest people in this group. What sort of a response do you think is required for this?

JASON MUNDY: I think the situation demands a military response, and I think we will carry through with that response. I do hope that cool heads prevail, and... And I think they have in the fact that the international community is responding so well to our call to have help, because we don't... We certainly don't want this to turn into a war of America against Islamic nations.

DEE CISNEROS: I think that the nation should stand behind our leader, our President, and we have to show this unity to the rest of the world. I mean, I'm ambivalent about military. I don't know how far they want to go. I don't know how far you want to go. I just can't see killing a lot of innocent people.

BETTY ANN BOWSER: Moe, let's hear from you. We haven't heard from you. What are you willing to give up? The President's been talking about sacrifice.

MORRIS CLARK: Well, I guess everyone will have to be personally inconvenienced, and to what degree that may be... For example, on a flight last night, I had my luggage hand searched, and I was very happy to have that. The real sacrifice is that people are more afraid.

BETTY ANN BOWSER: Are you?

MORRIS CLARK: No, I am not. But I had... The flight attendant asked me to move toward the front of the plane, if I wanted to sit up toward the front of the plane, and I did. And then a few minutes later, I said, "why did you offer me that?" She said, "You're a pretty big guy." And I looked at her and I said, "Are you afraid?" She said, "Yes, this is my last flight." And I thought that was very revealing. I think there is a certain amount of fear that people have.

BETTY ANN BOWSER: How do you expect your life to be different now, Susana?

SUSANA CORDOVA: One of the things that I think I find most frightening about what the future holds is I believe that the American people are willing to commit to doing whatever it takes. But "whatever it takes" has been... has not been defined, and what I think that most likely will play out to be is going to be very long, very arduous, filled with lots of sacrifices, both economic sacrifices, the loss of human life, you know, both American and foreign. And so in that way, I mean, I can see that could be something that will not be resolved very quickly.

LINDA STAHNKE: I think we'll be fighting here and fighting there and fighting somewhere else. And I think we have to be ready for our own sons... I have sons the right age to be going into these conflicts. I have friends who are in the military who are waiting now to be called -- friends in the reserves who are waiting to be called. And I think with all of our talk about resolve right now, it's going to be tested in a few weeks. This generation, this time hasn't faced conflict with very much human involvement. We were spoiled with the Gulf War by seeing so much technology employed and so few people lost. And I think we'rein... By the President saying we're in for something new, I think he's trying to prepare us so that we are ready to actually lose human beings and actually lay down lives.

BETTY ANN BOWSER: And your son?

LINDA HOUSTON: He just graduated from the Air Force Academy, and went... Is going on to pilot training. And it was such... There was such anxiety for me, and I had to be careful because he was so enthusiastic. He was so ready to go and so ready to be a part of what he knew was the right thing to do, and I'm so proud of him. But as a mother, there's a lot of anxiety. But I also look at all those people's lives that were lost. I mean, how can you weigh one life, even though it's your child, against someone who's lost their child?

BETTY ANN BOWSER: Mark, how do you feel about all of this?

MARK AJLUNI: I'm just very skeptical about giving Mr. Bush full mandate to conduct any full-scale war on his terms without there being some sort of national debate. And I haven't heard a national debate, and I haven't heard Mr. Bush define what exactly it is that he wants to do, or what the endgame of this whole thing is. I've heard a lot of intense rhetoric. I've heard the Assistant Secretary of State say we want to end states that are involved in terror. And it feels like this... this witch-hunt that could be developing, endangering American lives and certainly civilian lives abroad. I'm all for bringing these people to justice and I'm all for cracking terror rings in all forms. Don't get me wrong at all. But I feel like this country really needs to debate this issue publicly as a democracy and find out what is the best course of action in making the world a safer place.

DENNIS COUGHLIN: I think that we have to trust the leaders that we have, both political and military, and empower them to do the job. I certainly don't know where the terrorists are. I don't know all the hideouts and the cells and the... and the various groups. I don't have the access to the CIA or the intelligence information. That's why we have a representative government. And I think that that... I have complete confidence that they will do everything in their power to conduct this in the way the American public wants.

CHRIS GOODWIN: I think every issue in a democracy has to be debated, particularly when we're talking about war and peace.

ERIC DURAN: This is a war that's never going to end. I think that, you know, Osama bin Laden may be captured and brought to justice, or even killed in some military bunker, but I think, you know, this is just the beginning of a new chapter where we see - you know -- increasing terrorist attacks on the United States and on our way of life. This is just the beginning, and I only see it happening more in the future.

BETTY ANN BOWSER: Well, we're going to have to leave it there. Thank you all for being with us tonight.

RECAP

JIM LEHRER: We'll see you online, and again here tomorrow evening, with more coverage of the aftermaths from September 11, as well as, live, President Bush's address to Congress. I'm Jim Lehrer. Thank you and good night.