The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight, four regional economists asses the downturn, Terence Smith reports the new Hispanic awareness in the media, and Gwen Ifill looks at eliminating racial profiling by police. It all follows our summary of the news this Tuesday.

NEWS SUMMARY

JIM LEHRER: There were new signs of trouble in the economy today. The Commerce Department reported retail sales fell 0.2% in February. It was the first decline in three months. The largest drops came in spending for home furnishings and eating out. Most analysts had predicted an increase in retail sales. And there were more layoffs announced. Motorola said it will cut another 7,000 jobs from its cellular phone group. In all, the company has announced it's eliminating 16,000 jobs worldwide, since December. That's more than 10% of its workforce. Motorola's share of the world cell phone market has dropped sharply since late 1998. At the White House today, spokesman Ari Fleischer said the bad economic news underscored the need to pass President Bush's tax cut plan, and to make parts of it retroactive. But he dismissed suggestions that Mr. Bush's warnings about the economy were hurting consumer confidence.

ARI FLEISCHER: The President believes it would be a failure of leadership for the White House to put a pollyannaish glow on the economy if the facts indicated otherwise. The President thinks it would not be appropriate to withhold information from the American public about the state of the economy, and the President also believes that Presidents who are direct, who are straight, and who are forthright with the public serve the public well; and that's why he has discussed the economy in the manner that he did.

JIM LEHRER: We'll have more on the economic downturn right after this News Summary. Wall Street recovered a little today, after Monday's big sell- off. The NASDAQ Index gained 91 points, or nearly 5%, to close at 2014. On Monday, it finished below 2000 for the first time since December 1998. The Dow Jones Industrial Average added 82 points today, to close at 10,290. Overseas, Asian markets closed sharply lower, in the wake of Monday's slide on Wall Street. Japan's NEIKEI Index hit a new 16-year low. The U.S. Suspended all imports of animals and animal products from the European Union. It was an effort to stop the spread of foot-and-mouth disease to American livestock. The outbreak was confirmed today in France. The U.S. already bans beef from the European Union because of Mad Cow Disease. A ground controller became the focus today in a U.S. Navy bombing accident in Kuwait. Five Americans and one New Zealander were killed Monday, when a Navy jet accidentally attacked their observation post. It happened during a nighttime training run. A Pentagon spokesman would not confirm reports that a controller mistakenly cleared the pilot to attack. But he did say this:

REAR ADMIRAL CRAIG QUIGLEY: You try to preclude misunderstandings or the engagement of incorrect targets where some detail of the mission would be misunderstood by either the aircraft or the forward air controller. Your goal is to synchronize their understanding and then coordinate the activities of the aircraft.

JIM LEHRER: This was the second deadly accident involving the U.S. Navy in little more than a month. On February 9, a U.S. submarine rammed and sank a Japanese fishing vessel off Hawaii. Nine Japanese were killed. In Macedonia today, government troops battled ethnic Albanian rebels near the border with Kosovo. The fighting was near areas where U.S. peacekeepers are deployed. Amid the clashes, some 30,000 ethnic Albanians demonstrated in the Macedonian capital. They urged an end to the violence, before it leads to a wider Balkan war. The rebels agreed to a cease-fire, yesterday, along Kosovo's border with Serbia. An American peacekeeper in Kosovo was cleared today of negligent homicide. An army panel acquitted Private First Class Nicholas Young, in the death of an ethnic Albanian child last July. Young had been checking his weapon to make sure the safety was on, when it fired three shots. The bullets ricocheted off a vehicle and killed a six-year- old boy. Suspense novelist Robert Ludlum died Monday, in Naples, Florida. His publisher said he suffered a heart attack. He authored 21 books, many of them bestsellers about spies, conspiracies and government corruption. They included "The Scarlatti Inheritance" and "The Born Identity." Today, more than 210 million copies are in print, in 32 languages. Robert Ludlum was 73 years old. That's it for the News Summary tonight. Now it's on to: How down is the downturn, Hispanics in the media, and racial profiling.

FOCUS - DOWNTURN

JIM LEHRER: The economy is our lead story tonight. The markets were back up today, but economic news continued to be gloomy, today's example bring a report that retail sales were lower than expected last month. We look at what's happening now through the eyes of four regional economists: Joel Naroff is chief economist for Commerce Bank in Cherry Hill, New Jersey; Mark Vitner is vice president and economist at First Union Corporation in Charlotte, North Carolina; Paul Sommers is an economist and senior research fellow at the University of Washington, in Seattle; and Diane Swonk is chief economist and senior vice president at Bank One Corporation in Chicago. First let's just go around quickly to get an overview from each of you, starting with you, Mr. Naroff. Describe the situation in the Northeast: How is this downturn being felt in general terms?

JOEL NAROFF: Well there's some slowdown already, but it isn't really great. What happened in the Northeast was to a very large extent that we didn't have any major expansion. We didn't grow excessively fast during most of this growth recession in the '90s. As a result, we have a slowdown but not as great. Part of that is because we are not nearly as dependent on manufacturing. And this is largely a manufacturing recession right now.

JIM LEHRER: Sure. Mr. Sommers, the view from the West, the overview from the West.

PAUL SOMMERS: Our high tech economy is slowing down significantly. Software and computers and computer parts have all slowed down in response to the lower value of the NASDAQ and slow growth or cutbacks among major customers for these companies.

JIM LEHRER: And that's having a ripple effect?

PAUL SOMMERS: Oh, very definitely. You can see that in housing starts, for example, in this state, and just an unwillingness now of investors to put money into new start-ups which are hanging around on the fringes trying to get in, trying to establish some companies for the future.

JIM LEHRER: Ms. Swonk in Chicago, what does it look like in the Midwest?

DIANE SWONK: Well, you know, I think downturn is a wrong word for it. It certainly is a slowdown. But I'm in the heart of where the economic malaise is supposed to be the worst. And you'd be hard pressed to find a consumer on the street that's not still spending. Putting those spending figures into context today too they came on the heels of the doubling of the pace of spending in January and so on net many people are revising up their views of GDP growth in the first quarter because consumers are actually spending more than they thought particularly on vehicles, very important to the Midwest. We've seen production decline to drain inventories. But now the automakers are talking about an increase in production in the second quarter so we're at an inflection point where we're almost going to see this weakness turn to strength as production comes back along with consumer spending.

JIM LEHRER: So downturn is not in your vocabulary.

DIANE SWONK: Not at all. I think a slowdown is certainly well within all of our vocabulary. But listen to what we're talking about now. A slowdown is different than a downturn. We were an economy going at 110 miles an hour a year ago. We've slowed down to 40 miles per hour. It seems like we've stopped but we're still moving slowly forward. And I think we're going to reaccelerate well above 60 miles an hour, even higher before the year is over.

JIM LEHRER: Okay. Mr. Vitner, in the South, is it a slowdown? Is it a downturn? If not one of those two, what is it?

MARK VITNER: Well, it's definitely a slowdown. We're taking some lumps but overall the South is still growing slightly faster than the nation. We've got an unemployment rate that's averaging about 3.8% and job growth is still better than 2%. But at the same time, the manufacturing sector in the South, which is rather large, particularly in non-durable goods industries, has taken a lot of hits. North Carolina actually leads the nation in manufacturing job losses with a loss of about 25,000 jobs over the last year. We've also seen some trouble in the tech sector. Atlanta actually added the most high-tech jobs during the 1990s of any city in the country. And it's seen quite a slowdown recently and tech companies have given back about 4 million square feet of office space back to the sublet market because they took out leases on this space thinking they were going to need it or grow into it. Now they're actually moving the other way.

JIM LEHRER: Let's go back around again and begin with you Mr. Naroff, what is all this talk of slowdown, of downturn or whatever? What's the psychology at work here -- as you read it?

JOEL NAROFF: Some of the business people have become a little bit more cautious, but in this area again we have a whole lot of situations where, for example, in commercial real estate, vacancy rates are in the single digits. It's hard to find space; in a state like Connecticut, the unemployment rate is in the 2% range and it's hard to find people even now. Consumers are a little cautious. Businesses are hearing that it's a major problem, but they're really not cutting back dramatically at all. I think the ideas that they're hearing more than they're seeing as I think others have commented, and that's grated a caution but it hasn't created major reaction at least at this point.

JIM LEHRER: Mr. Sommers, in your part of the world, are they hearing more than they're seeing, or what's the situation?

PAUL SOMMERS: I think slight caution is the right metaphor to be using here. We still have a software industry that seems to be expanding. Boeing has stabilized. That's a very, very good thing for this state. There's some trouble spots in agriculture and forest products. But those are the only places where you really see cutbacks in this state. So, overall, I think there's still a lot of strength and people are bearing up under that.

JIM LEHRER: And Ms. Swonk, you said earlier that people are still buying in the Midwest, right?

DIANE SWONK: Actions speak louder than words. And I think one of the things that's important to look at is even though overall consumer confidence has deteriorated there's a real dichotomy which Alan Greenspan has referred to, the difference between how people feel about their own backyard, their own wallets and how they feel about their expectations about the future. Their expectations about the future have deteriorated quite sharply mostly related to negative news regarding the economy. Their own current financial situations, thought, have held up relatively strong. They're well within expansion territory. And it sort of goes back to something I always live by: Never bet against a consumer who has got money in their pocket to burn.

JIM LEHRER: Okay. Tell us about the consumers in the South, Mr. Vitner.

MARK VITNER: Well, the consumers in the South seem to be very well. Home sales are close to a record level across the Southeast. The southern United States accounts for half of all the new homes that are built in the country. And this year has gotten off to a strong start. The tourism industry in Florida has been doing remarkably well. In fact, some of the problems that hit the U.S. economy actually were a benefit to Florida because when it turned real cold in the rest of the country, the economy tended to turn down but that also caused a lot of tourists to head to Florida. But I don't want to come across as saying that, you know, that there's the all-clear signal out there. We still think that the economic growth is going to be relatively sluggish throughout most of this year. It's not just an inventory problem that we're facing. There is a severe overcapacity in the high-tech sector that's going to take some time to be worked off. When we get the inventory numbers tomorrow, we get manufacturing and wholesale and retail inventories tomorrow, retail inventories will have dropped, wholesale inventories will have dropped but manufacturing inventories have increased. And they're going to continue to be a problem. So I don't know that we're going to move past this trouble in the manufacturing sector in the next couple of months. It's likely to linger through the summer.

JIM LEHRER: You mentioned it earlier and we talked about it here on this program last night -- what's happening in the high- tech area. Is that having a measurable effect in your area, Mr. Vitner?

MARK VITNER: Yes, it is.

JIM LEHRER: You mentioned Atlanta. Is there anything beyond that?

MARK VITNER: Well, the Raleigh Durham area -- I just got back from visiting with clients up there. That's a major high-tech center. IBM has put expansion plans on hold. Cisco is cutting back. Nortell is cutting back. The Washington, DC area has also seen a number of lay-offs. That's the biggest high-tech center in the country is actually the Washington, DC area, which is basically the birthplace of the Internet. And they are seeing a lot of cutbacks there as well. So I think it's too soon to say we're out of the woods yet but I do think that we will see some improvement on the consumer side before we see some improvement in the high- tech sector.

JIM LEHRER: Ms. Swonk, yes.

DIANE SWONK: I just wanted to add on the high tech side that people don't think of the Midwest on the high tech side, but the silver lining to the NASDAQ collapse and the misallocation of capital to the dot-com frenzy was a fairy tale -- as Warren Buffet puts it - I think is important because there is a silver lining.

And that's that I'm walking in to firms everyday who are increasing their investment and how they can harness the power of the Internet to increase productivity growth inside their firms rather than....

JIM LEHRER: These are traditional firms? These are not high-tech firms or dot-coms?

DIANE SWONK: This was the old-line industries, exactly.

JIM LEHRER: All right.

JIM LEHRER: Literally the life was being sucked out of it a year ago when the NASDAQ was booming. And I think there's been -- we've also seen many old line firms who could not find tech workers finally able to find them. An irony in my own backyard is Lucent Technologies. They had a lot of layoffs there recently announced, although at the same time, they're trying to scramble to hire tech workers. In fact, seven out of ten tech workers today work in old line industries and those old line industries are still scrambling to find workers so they're being absorbed fairly quickly in this economy that continues to generate more demand for workers than actual workers. And that's a very important shock absorber that I think we have to take into account.

JIM LEHRER: And, Mr. Sommers, you already mentioned high tech. That's a really big deal out in your part of the world, is it not?

PAUL SOMMERS: It is indeed. The software sector in particular in this state has grown more rapidly than anything else and continues to grow while the dot-coms have shrunk. We've lost maybe 8,000 jobs among dot-coms in Washington but gained more than 10,000 in software in the same year.

JIM LEHRER: Now, explain why that could be for those of us who don't follow this sort of thing.

PAUL SOMMERS: Many of the software companies are providing tools that help the dot-com types the e-commerce companies. So there is a little bit of a spillover impact there. But the others are selling main line software applications that have much broader utility than e-commerce. And those companies led by Microsoft have continued to grow.

JIM LEHRER: Microsoft is still hiring, right?

PAUL SOMMERS: Microsoft is hiring but at a slower pace. This is one of the reasons you have to think of it, I think, as a slowdown, not as a recession. Microsoft grew by about 7,000 people over the last year. They've announced that they're going to hire another 2100 or so in the next 18 months; so slower but still growing.

JIM LEHRER: Mr. Naroff what's high tech mean in the Northeast?

JOEL NAROFF: Well, high tech has its importance here. There's no question. Diane mentioned about Lucent in New Jersey is obviously very dependent on it.

JIM LEHRER: Because Lucent is headquartered in New Jersey.

JOEL NAROFF: That's correct. And obviously that's a concern here. But it isn't nearly as great, it doesn't have the concentrations, it has the pockets. There's pockets in Philadelphia, pockets in New Jersey -- and obviously up through Connecticut and especially in Massachusetts. So it does make a difference. But I think one of the things to keep in mind is that there is a dark side to the productivity gains that we've begun to see here. And that's the idea that businesses are reacting very rapidly to the changes in the economy, the slowdown. They're reacting all at once. And so what we're seeing is a compression of the adjustment process now. Whether it's in high tech or it's in manufacturing, we're seeing a long-term six, nine, 12 month compression occur in s x or 12 weeks. And that makes it look like it's a lot worse than it actually is. We're seeing it here in the Northeast, but again it's not nearly as significant.

JIM LEHRER: Mr. Naroff, what about Wall Street? What effect... everybody in the news business including our program, we always report the market is up or down. Yesterday heavy thing and NASDAQ was way down. Dow Jones was way down. What's the effect on Main Street Northeast to the stock market?

JOEL NAROFF: Well, obviously especially in the New York metropolitan area, Northern New Jersey, Southern Connecticut, incomes are going to be affected by that. We'll see what happens as we move through this year in terms of the ability to spend. And a lot of it is going to affect it on the larger side, the luxury types of expenditures whether high-cost vehicles or houses down at the shore or whatever may be the case. We're beginning to see a little bit of slowdown. But again I talked to real estate agents down on the New Jersey shore, and they're not seeing any sort of major cutback as far as that's concerned -- a slowdown, yeah. We expect to see it. And that's probably the biggest impact. It will affect the New Jersey- New York, Connecticut area though.

JIM LEHRER: Ms. Swonk, does bad news on Wall Street affect what an average consumer would do in the Midwest?

DIANE SWONK: It has more of an effect on their expectations. Half of households have - you know-- something invested in the stock market. But the overwhelming majority of households, the largest asset they hold is the money in their homes. We've seen refinancings surge in recent months actually and stay at high levels. It means they're cashing in on the equity in their homes, rather than worrying about the equity in the stock market at the moment. And I think that's part of the reason we've seen spending so resilient in the face of these stock market woes. I think unfortunately Wall Street certainly has a role in understanding the economy, but because so much of our news is based off Wall Street, we often get a very misperception of it about what happens to Main Street America. To Main Street America what's more important to them is the fact that their real wages are still intact and rising; the paychecks they take home every other week are still rising, relative to overall price levels. That's what's important, and that's something that hasn't happened in 30 years with the kind of run we've had over the last several years. And I think that's what's dominating spending right now.

JIM LEHRER: Mr. Vitner, would you read it the same way in terms of Wall Street in the South?

MARK VITNER: I read it a little bit differently. If you look at retail sales relative to after-tax income, in the period where the stock market boomed in 1999 and early 2000, spending grew two to two-and-a-half times faster than after-tax income for a period of 18 months. And that was pretty much unprecedented in the history of this country or at least in the post war period. Now, we're seeing a little bit of a pay back. For the last six months retail sales have been growing less than after-tax income. And I think we're going to see a continued payback probably through the rest of this year. Retail sales are still growing; they're just not growing as rapidly now that the market has come off a bit.

JIM LEHRER: Okay. Mr. Sommers - Yeah - let me just ask Mr. Sommers on Wall Street before we go. Yes, sir.

PAUL SOMMERS: The one difference I would say out here is that a substantial amount of stock wealth accrue to people who got stock options at Microsoft, McCaw Cellular, some of the other successful companies. Those people were the investors that fueled the dot-com boom and much of the high- tech boom out here. They're feeling less wealthy; they're much less likely to invest money right now. That has a real long-term effect that I do worry about a it.

JIM LEHRER: All right. Yes, quickly, Ms. Swonk, you wanted to say something.

DIANE SWONK: I just wanted to say that the stock market when we had all those strong spending gains, which had very low oil prices and a mortgage refinancing boom that was delivering $60 billion in cash to consumer pockets. That money is spent directly on my capital gains which has turned around. So I think a lot of factors contributed to the gains we saw in recent years. It was not purely a stock market phenomena. The savings rate is still falling. If it was a wealth effect, it should be rising now.

JIM LEHRER: All right. I got you and our time has spent. And thank you all four very much.

FOCUS - TUNING IN TO HISPANICS

JIM LEHRER: Now, tuning in to Hispanics. Yesterday, the U.S. Census Bureau reported the 2000 Census shows a sharp increase in Americans who call themselves Hispanic. Media correspondent Terence Smith looks at their impact on the media culture.

RICKY MARTIN: (singing) Here we go ole, ole, ole

TERENCE SMITH: It was an all-American moment: A pre-inaugural bash at the Lincoln Memorial, and the star attraction, Ricky Martin. His Latin rhythms appeal to both Hispanics and an increasingly diverse young America far more open to cultural differences than their parents' generation.

SPOKESPERSON: Wo!

SPOKESPERSON: Go!

TERENCE SMITH: The crossover success of the Puerto Rican singer is a manifestation of a dramatic change that is underway in the American cultural marketplace, a change that has huge implications for American media. (Cheers and applause)

JULEYKA LANTIGUA: I think that mainstream America, besides pop icon references, really has a hard time understanding how it is that this group emerged in the United States.

TERENCE SMITH: Juleyka Lantigua, 25, is managing editor of "Urban Latino" Magazine in New York.

JULEYKA LANTIGUA: I know, I know. It's not... Right, okay, okay, okay.

TERENCE SMITH: The bi-monthly is targeted to young, English speaking Hispanics, who have not let go of their cultural roots.

JULEYKA LANTIGUA: We live in English, but we enjoy our lives in Spanish. I come to work every day and I speak in English to my fellow Latinos, but I think when we each go home, we speak to our parents and to our, you know, extended families in Spanish. There's that duality, you know, of my nine-to-five, and then my five and beyond.

TERENCE SMITH: Here in the sprawling melting pot that is Los Angeles County, something significant is happening. Hispanics are approaching a full 50% of the population. Nationwide, 13%; with a high birthrate, continued immigration and a median age of only 26, they are more than ever an important market for television networks and advertisers.

SPOKESMAN: (speaking Spanish) Buenos tardes amigos. Los catorces quarenta a la radio caliente.

SPOKESPERSON: (speaking Spanish) Con mas musica aqui, en planeta KTXZ.

TERENCE SMITH: Advertisers have historically reached out to U.S. Hispanics on Spanish language radio and TV, spending more than $1 billion last year on Spanish- language television alone.

SPOKESMAN: (speaking Spanish) Para todos de la mas, este MasterCard.

TERENCE SMITH: Two contrary trends are at work here: While audiences for the big four networks have shrunk, Spanish- language television has seen double-digit growth in advertising. Revenue projections are so strong that powerhouse Univision and its smaller competitor, Telemundo, will be joined by a third Spanish language television network this year. Nonetheless, the mainstream English-language networks have been slow to reach out to the nation's youngest and fastest- growing minority, 75% of whom are comfortable in English. One exception is ABC's "World News Tonight," which now broadcasts an alternative Spanish language track.

SPOKESMAN: Esta noche en "a closer look."

TERENCE SMITH: CBS and NBC are considering doing the same. Another exception: Children's programming on cable.

SPOKESMAN: Wait a minute, where are we going? Those look like gates.

TERENCE SMITH: The Disney Channel, Fox Kids.

ACTOR: A look at those masks is like a reflection of the soul.

ACTRESS: This is the holy trio of Latina superstars.

TERENCE SMITH: Nickelodeon.

HERB SCANNELL: Nickelodeon has gained a lot of its strength by doing what other people aren't doing.

TERENCE SMITH: Herb Scannell is president of nickelodeon, the number one rated children's cable network. The channel now has three shows with Hispanic characters.

HERB SCANNELL: We want to reach as many kids as possible. Shows like "Dora the Explorer," "the Brothers Garcia," makes the population, you know, the tent that we have here a bigger tent. Our game's really simple: We want all kids in.

SPOKESMAN: Take two.

SPOKESMAN: Three out of the four of the scenes are in the kitchen.

TERENCE SMITH: Colorado born Jeff Valdez, who produces Nickelodeon's "The Brothers Garcia," has been frustrated by cultural stereotyping and what he sees as his industry's total lack of understanding of us Hispanics.

JEFF VALDEZ: The media, the industry, always go, "Oh, well, you're Latino. You do things differently." No, I don't ride a Latino car, I don't use Latino pencils, I don't have a Latino shirt on. You know, I'm an American like anybody else.

TERENCE SMITH: "The Brothers Garcia" is about a middle class Hispanic family.

ACTRESS: Ramon.

ACTOR: Not today, Mijo.

TERENCE SMITH: But the show and its humor are designed to have universal appeal.

ACTRESS: Who's the astronaut?

ACTOR: Mom, he was part of the U.S. Space program -

ACTOR: -- until a cosmonaut accidentally punctured his space suit.

ACTOR: And now he's gone and goofy. That's why they call him the astro-nut. Get it?

TERENCE SMITH: Early demographic breakdowns of the show indicated that only 5% more of the viewers are Latino than he audiences of other programming.

TERENCE SMITH: What does that tell you?

JEFF VALDEZ: it tells me that the U.S. audience is smarter than I think Hollywood is giving them credit for. It tells me that race isn't as significant to people as it is to studio and network executives.

TERENCE SMITH: The youth market-- tomorrow's consumers-- may be ahead if the curve.

JEFF VALDEZ: So are kids driving it? Well, yeah, because nick's very in touch with their audience. Are adults not open to this? I think they are. I mean, it's the executives in the industry that is not open to us -- the people who control the purse strings.

TERENCE SMITH: Some suggest that for young Anglo viewers, casts of color may seem more real than the shows currently on television.

GIRL SINGING: I have dreams of me being a star

JEFF VALDEZ: It's the norm. To see kids of other backgrounds on TV, on these cable, hey, that's the way it is down the street, that's the way it is at my school. So these kids are open to that.

TERENCE SMITH: Federico Subervi is an associate professor of radio, television and film, at the University of Texas. He says decision makers have largely ignored the strong Latino influence in some of the nation's biggest markets: California, Florida, Texas and New York.

FEDERICO SUBERVI: They are not familiar with this information, either the population or the cultural characteristics. Most of the Latinos they ever met were the maids, the gardeners, the mechanics maybe. So for them, Latinos are these underclass, that they have no reason to pay attention to.

RADIO PERSONALITY: Austin's numero uno tejano hit station.

TERENCE SMITH: There have been major breakthroughs by Hispanics in the youth oriented recording industry. This year's Grammy's had seven awards in the Latin category alone.

CHRISTINA AGUILERA: (singing) Now baby don't be shy

TERENCE SMITH: Christina Aguilera records in English and Spanish.

CHRISTINA AGUILERA: (singing) Solamente tu

TERENCE SMITH: Jennifer Lopez has crossed over between music and films. But critics say these pop icons are just one more Latin stereotype. Juleyka Lantigua.

JULEYKA LANTIGUA: We cease to be complete entities. We become microphones. We become people who shake their bon-bons. We become people who are known around the country for their well-shaped derrieres. This is not who I want to be.

TERENCE SMITH: But, others argue, anything that exposes mainstream America to Latin culture is a plus.

FEDERICO SUBERVI: The dance clubs in this city of Austin have Anglos and Latinos and Asians and African Americans all dancing to the rhythms of Salsa and Merengue and the Cubias and enjoying it. That's not bad.

TERENCE SMITH: Subervi says the Latin influences in the U.S. are here to stay. U.S. Hispanics are not assimilating as previous waves of immigrants have. Instead, they cling to family ties and traditional values.

FEDERICO SUBERVI: One of the reasons is simple. The border is closer here. And the cultural heritage that comes with it-- the music, the cuisine, those radio and TV stations, the newspapers-- are right at their fingertips.

JULEYKA LANTIGUA: I think that we definitely want to assimilate I just think that we're not willing to give up everything the way that, you know, other immigrants had. There isn't a desperation, because there are so many of us already here.

SPOKESMAN: Okay let's do the single.

TERENCE SMITH: Jeff Valdez says the big four TV networks will inevitably catch on. Hispanic buying power has been estimated at upwards of $450 billion.

JEFF VALDEZ: Currently, you're talking about an audience that is spending $500 billion a year, growing to a trillion by 2010. Eventually, the board members will say, "gang, there's a trillion dollars sitting over there that you're missing."

TERENCE SMITH: Nickelodeon's Herb Scannell.

JERB SCANNELL: I think you've got to believe that diversity is good for business. And if you believe that, then you start to make choices in that way. You know, you stop coming up with all the reasons why you shouldn't do it.

TERENCE SMITH: If so, the profit motive may produce the diversity in mainstream media that so far, at least, has been lacking in mainstream media.

SPOKESMAN: Cut, print.

JIM LEHRER: Still to come on the NewsHour tonight: Racial profiling.

FOCUS - RACIAL PROFILING

JIM LEHRER: Now, Gwen Ifill has the racial profiling story.

GWEN IFILL: In 1992, Robert Wilkins, a Harvard educated lawyer, was driving with three relatives on a Maryland highway. A state trooper pulled them over and tried to search their car.

ROBERT WILKINS: And when I pushed him as to why he thought we were suspicious, and why he thought he had a right to do this to us, he said, "well, we're having a problem with rental cars and drugs." And that wasn't really a satisfactory response because, as I told him, I said, "I know that you are not stopping everyone in a rental car and searching them. And driving a rental car isn't any reason for you to think that somebody is suspicious and they might have drugs."

GWEN IFILL: Wilkins believes he was stopped simply because he is black. He sued the Maryland State police, and was awarded a $96,000 settlement. Part of the deal, state troopers must now record the race and the gender of the drivers they stop. Allegations of racial profiling went national in 1998. That's when two white New Jersey troopers shot and wounded three of the four unarmed Blacks and Latinos traveling in a van they had stopped. The men sued, and settled for $12 million.

JOHNNIE COCHRAN: By virtue of the actions of these young men and our representation of them, we now have had that state acknowledge racial profiling existing for a substantial period of time, and these young men have been the leaders in that effort.

GWEN IFILL: Drivers all over the country have said they have been targeted by police. They call it driving while black. And dozens of law enforcement agencies and civil rights groups have begun gathering information on the practice. The Department of Justice released its own survey, this week, on police contacts with the public. Its findings: More black than white drivers were stopped in 1999 - 12 percent to 10 percent. But more than twice as many Blacks and Hispanics were searched when they were pulled over, 11 percent, as opposed to 5 percent for white drivers. 90 percent of those searches uncovered no evidence of criminal wrongdoing. In his first message to Congress, President Bush instructed his Justice Department to target racial profiling.

PRESIDENT GEORGE W. BUSH: Too many of our citizens have cause to doubt our nation's justice when the law points a finger of suspicion at groups, instead of individuals. Earlier today, I asked John Ashcroft, the Attorney General, to develop specific recommendations to end racial profiling. It is wrong and we will end it in America. (Applause)

GWEN IFILL: Attorney General Ashcroft has met black lawmakers and asked Congress to help finance a study of traffic stop data.

JOHN ASHCROFT: If you're an affected individual here, the statistics about how many it affects or doesn't affect somewhere else in the culture don't mean much to you, because for you it's 100%. It's like the guy who is unemployed; the unemployment rate for him is 100%. For people who have been the victim of racial profiling, the statistic is 100%. It's wrong.

GWEN IFILL: But what exactly is racial profiling? For answers, we turn to Kenneth Meeks, managing editor of "Black Enterprise Magazine," he is the author of a book titled, "Driving While Black"; David Harris, a law professor at the University of Toledo, has written extensively on racial profiling; and two police chiefs, Robert Duffy from Rochester, New York, and Robert Olson, from Minneapolis.

Mr. Harris, could you please start us off by helping us with some of the research you have done defining racial profiling. What is it?

DAVID HARRIS: Well, certainly. Racial profiling is not a legal term. It's just a way of describing a set of police tactics. A profile is nothing more than a group of characteristics that we think are associated with some particular kind of behavior in this situation crime. It becomes racial profiling when race or ethnic appearance plays a role in who police decide is suspicious. And what has happened over the years as we've begun to study this is that we notice that in certain places, many places-- though not all places-- police action has an impact on racial groups, especially African-Americans and Latinos. They are stopped and searched in numbers that are far out of proportion to their presence on the road and far out of proportion to anything that would have anything to do with their driving behavior. So what is happening is that race is being used as a kind of proxy, as a substitute to allow police to focus on one particular group that they think has a higher chance of being involved in crime. That's the nut of what racial profiling is.

GWEN IFILL: Professor Harris, what is wrong with using a descriptive characteristic such as race to target people who might be wrong doers? There are those who, for instance, argue that more black people may commit crimes. And so therefore why wouldn't you stop them out of proportion? Is that true?

DAVID HARRIS: There's nothing wrong with using a racial characteristic as a description, but using it as a prediction is quite different. When we use race to predict who we think might be criminals, what we do is we subject everybody in that group to treatment as a potential criminal. I think we all recognize as Americans that's not right, that's not fair; it's wrong. Now is it true that African-Americans are arrested and jailed disproportionate to their numbers in the population? Yes, that is true. That's a very unpleasant fact but it's a fact nonetheless. The thing is, you cannot draw from that that it makes sense to then stop all the African- Americans or high percentages of African-Americans or Latinos that you run into because even if there is more criminal involvement, the great, the vast majority of these people are innocent, hard-working, tax-paying, right-living citizens. And to use arrest rates turns the whole thing around. Arrest rates don't measure criminal offending. Arrest rates are a measurement of police activity. So the whole thing becomes a self-fulfilling prophecy and a circle.

GWEN IFILL: Kenneth Meeks, is there a broader concern at work here than just traffic stops when we talk about racial profiling?

KENNETH MEEKS: Definitely. Definitely. My definition of racial profiling tends to expand beyond just state troopers and minority motorists because we can be racially profiled walking into a department store, coming up to a kitchen counter or any kind or counter or even in restaurants. I mean, we are racially profiled on a much broader sense of the word, I mean of the nature of this crime. I think that, you know, one of the things that we have to look at is when we come into U.S. Customs, you know, black women are... for a long time we were like 20% more likely to be stopped coming through Customs than anybody else. So racial profiling does extend beyond just the highways.

GWEN IFILL: Chief Duffy, the kind of settlements in cases we've heard about puts pressure on local police or state police in law enforcement. Do you have any sense that there is statistical evidence to support these allegations by and large, or is it mostly anecdotal?

ROBERT DUFFY: It's a combination of both. Statistics definitely play a role but there are plenty of anecdotal stories, which also I think tell us all that there is a problem whether real or perceived. I think it is incumbent upon leadership in police departments and police organizations to ensure that the Constitution is followed and the definitions that were used relative to racial profiling I would agree with. Race as a sole determinant should never be used in terms of police actions. But I think the bigger picture here and probably the bigger problem is an issue of trust. I think there is a lack of trust in many communities in law enforcement. It's incumbent upon us as police chiefs and police departments to work hard to earn that trust. Because I think we have lost it over the years by virtue of some of the problems that we've seen.

GWEN IFILL: Chief Olson, what's your experience with that? Is this a matter of trust, number one? And number two, do you have any evidence in your jurisdiction that this is a problem?

ROBERT OLSON: Well, I think I would echo what bob just said. There is a perception in our new immigrants and our communities of color that this is going on. And the anecdotal evidence demands that we in law enforcement really look at this in a systematic way, and one of the best ways to begin solving this issue-- and there is a problem-- is to collect data so that we have some good baselines from which we can go forward to root out any of those causes. You know, you have to understand that our police departments are made up of people from the community. And they have the same biases and prejudices that the community does. So we have to expect that though most officers clearly would abhor and not doing anything like racial profiling, there could be some of that going on. And we have an obligation to those new immigrants and people of color, we need to get in there and find out and then figure out how we can stop it.

GWEN IFILL: So, in your department, what do you do about it? How do you root out people's ingrained societal biases?

ROBERT OLSON: Well, you start with your selection process, and that's the long-term issue and doing the proper testing to find people with those tendencies. Frankly, you don't hire them. You then have good internal processes so that when people come to you with complaints about that kind of thing and others, that you have a good process to root it out and get rid of the officers who would act that way. And then on the other side of that, you have to reach out to the community. I think that's the big one there. You've got to develop data, do it by neighborhood because neighborhoods are all different. You need to come out forward with them and show them just what's going on and be up front about it.

GWEN IFILL: Professor Harris, there are those who would argue that the reason why racial profiling has taken hold as you define it is because it works. Does it work?

DAVID HARRIS: No, ma'am, it does not. And that's one of the great myths of this. Racial profiling does not work, and the evidence for that is in the statistics that have been gathered in places like Maryland and New York and New Jersey and a whole host of others over the last few years. If race actually predicted a higher rate of criminality, what we would see is that the success rate for searches of African-Americans and Hispanics would be much higher than the success rates for searches of whites. And in all those jurisdictions that I mentioned-- and others-- what we actually find is that the success rates or the hit rates as I call them in my work are the same between blacks, whites and Hispanics or they're even lower for minorities -- even lower. So that tells us that this is not smart policing. It is not effective policing. It is not efficient policing. There is an ingrained belief that the right way to police and to go where the crime is is to go and focus and target minorities, but it just doesn't turn out to be true. The numbers do not support it. And the result is, as the chiefs were saying, there has been a breakdown of trust. And trust is central to the success of police because police today know that they cannot do the job of cutting crime alone. They need the support of the community. And if they don't have it, that's going to hurt everybody, not just the people who are profiled erroneously, but the general officer out there on his job, her job, trying to cut crime is going to be hurt by this because he won't have the trust of the community.

GWEN IFILL: Mr. Meeks, your magazine and the book you write is targeted to an audience, which feels itself to be disproportionately affected about this. What do you tell them about this? What do you tell them to do?

KENNETH MEEKS: About racial profiling. Well, we tend to say if you happen to be stopped by police officers, let's be conscious of our demeanor and our behavior because we don't want our actions and our reactions and our emotions to get us killed -- particularly when we're talking to an officer who has a gun and a badge. I tend to tell people, let's complain, file a formal complaint against people who profile us, whether it be a police officer or a manager in a store or someone at a sales clerk, let's file a complaint. Let's leave a paper trail so that if this person decides to profile somebody else and somebody else complains, then, you know, we can show a pattern of behavior because profiling is hard to prove. You very seldom have a smoking gun in someone's hand when it comes to, you know, getting people or convicting people on profiling. And that's just a small fraction of what things we need to do.

GWEN IFILL: Chief Olson, do you worry at all that your officers who are concerned about being accused of this would as a result be less likely to pursue reasonable suspects, that this might hinder your investigative work?

ROBERT OLSON: Well, yes, there is a possibility. That's why I kind of worry about how it gets couched in the media and whatnot that a lot of good, hard-working officers are out there. And they kind of take affront at that. And there is always the fear that there would be a chilling effect on some of their other law enforcement activities, but even putting that aside, however, you can't sit with your head in the sand and do nothing. America's law enforcement community has to step up to the plate here and start dealing with this issue.

GWEN IFILL: Well, Chief Duffy, you heard the President talk to John Ashcroft about doing something, not sticking their heads in the sand as Chief Olson just said. What do you do? How do you legislate against what you describe as a lack of trust or even just bad will?

ROBERT DUFFY: I think legislation probably has a lesser effect than good leadership and reinforcement throughout our organizations. I agree with the comments that were made tonight. I think there were a couple things I would like to reinforce. First of all, police officers need to have information at their fingertips through technology because we cannot police by probability. We need facts. I think we try and establish probabilities; that is when I think you cross over the line and we get into this area of profiling. I think as I said, racial profiling should not be a part of any police department. I also think we have to reinforce with our officers how important it is to do various policing in our neighborhoods to focus on crime. We should always police with great respect. And that should be reinforced routinely in organizations. And I think the most important part is establishing relationships with our community. If we establish those relationships, we build trust and we also get the information that is so specific to crime and to problems that there is no need to rely on probabilities and profiling.

GWEN IFILL: Professor Harris, we only have a few seconds. Does that sound right to you? Is that the way you approach this?

DAVID HARRIS: That's the way you go. You cannot legislate trust but you can use legislation to make a good start. I agree with what the chief said. It's not possible to attack the problem by attacking officers. We have to look at this what it is: It's an institutional practice that has gone unexamined for too long. And we all-- police and public-- have an interest in examining this, because it's not just a problem for minorities or black people or people of color; it's a problem for every American who believes in fairness.

GWEN IFILL: Okay. We'll have to leave it there. Gentlemen, thank you all very much.

RECAP

JIM LEHRER: Again, the major stories of this Tuesday: There were new signs of trouble in the economy, the Commerce Department reported retail sales fell 0.2% in February. And, Motorola said it would cut another 7,000 jobs. A correction from last night, I said CISCO Systems was cutting 17,000 jobs; that was wrong, it's 8,000, or nearly 17% of the company's work force. We'll see you online, and again here tomorrow evening. I'm Jim Lehrer. Thank you, and good night.