The MacNeil/Lehrer NewsHour

INTRO

ROBERT MacNEIL: Good evening. The top stories today. President Reagan takes the blame for the Marine headquarters bombing.

Pres. RONALD REAGAN: If there is to be blame, it properly rests here in this office and with this President. And I accept responsibility for the bad as well as the good.

MacNEIL: We'll have a full report. U.S. Steel stunned its workers today by announcing a drastic cutback, closing all or part of several domestic plants with a loss of 15,000 jobs. We'll examine the reasons and the reaction. Jim Lehrer's off; Judy Woodruff's in Washingtion. Judy?

JUDY WOODRUFF: Also tonight, Robin, we report on a most remarkable encounter betwen Pope John Paul II and the man who tried to kill him. We talk again about our record winter weather and the hidden costs of the cold wave, and finally look at an original treatment of an old classic: children's writer Maurice Sendak meets the Nutcracker.

WOODRUFF: President Reagan said today that Marine and Pentagon commanders would not be punished for any lapses on their part that preceded the suicide bombing of Marine headquarters in Beirut last October. The President said if someone is to be blamed, it should be he. Mr. Reagan made his remarks at a hastily called news conference at the White House this morning before he flew to California for a week's vacation. His comments came in reaction to a report prepared by a Pentagon-sponsored commission which examined who was responsible for the security failure that led to the deaths of 241 U.S. Marines.

Pres. REAGAN: We have to come to grips with the fact that today's terrorists are better armed and financed; they are more sophisticated; they are possessed by a fanatical intensity that individuals of a democratic society can only barely comprehend. I do not believe, therefore, that the local commanders on the ground, men who have already suffered quite enough, should be punished for not fully comprehending the nature of today's terrorist threat. If there is to be blame, it properly rests here in this office and with this President. And I accept responsibility for the bad as well as the good. The problem of terrorism will not disappear if we run from it. This is not to say that we're not working as urgently as possible to create political conditions in Lebanon that will make it possible for us to remove our forces. But we must not delude ourselves into believing that terrorism will vanish on the happy day that our forces come home. For terrorists to be curbed, civilized countries must begin a new effort to work together, to share intelligence, to improve our training and security and our forces, to deny havens or legal protection for terrorist groups, and most important of all, to hold increasingly accountable those countries which sponsor terrorism and terrorist activity around the world. The United States intends to be in the forefront of this effort.

This terrorism isn't just some fanatical individual who gets an idea and goes out on his own. Now, there is evidence enough, even if you couldn't go into court with it, that it has at least a kind of tacit encouragement from various political groups and even from some states. Terrorist activities have multiplied, as the report shows, to three or four times as many incidents around the world as there were in 1968. And incidentally, 53% of those have been aimed at American, at the United States targets.

WOODRUFF: A White House official later spelled out some of the findings of the commission report that the bombing reflects a new trend of state-supported terrorism that differs from past threats; that intelligence was not adequate to anticipate the attack; and that steps taken since the bombing to bolster security around the Marines have reduced their vulnerability but are not totally adequate. The commission directed Defense Secretary Weinberger to take appropriate disciplinary steps, but President Reagan overrode that in his decision not to take action against anyone in the chain of command. It was ironic that as Mr. Reagan spoke this morning about the increased threat of terrorism, more heavy concrete barricades were being placed around the White House to supplement barriers already placed there in recent weeks. Robin?

MacNEIL: In Beirut today, the U.S. Marines went under their highest alert state as artillery shells slammed into the airport behind their positions.No Marines were hurt. The shelling from unknown guns came in spite of a ceasefire that ended three days of fierce fighting between the Lebanese army and Shiite Moslem guerrillas. More than 60 people were reported killed and 200 wounded in the holiday weekend fighting, among the heaviest since the Israeli invasion last year. Some of the worst damage was at the Shatila refugee camp, where thousands of Palestinians were forced to take shelter during the fighting. The devastation was plain to see when camera crews visited the area today. Much of the damage seemed to have been caused by shells fired from tanks. But the Lebanese army and the Moslem militiamen also used rockets, grenades, machine guns and rifles. The outcome of it all was that the Lebanese army gained control of Shatila camp, after 10 years during which first the PLO guerrillas and then the Lebanese Moslem militiamen kept the government soldiers out. Judy?

WOODRUFF: In Israel, Defense Minister Arens said today that his government is considering tough new measures against Palestinians who cause trouble in the occupied West Bank. Arens said authorities might demolish the homes of Palestinians who live near main West Bank roads to keep demonstrators from throwing rocks at Israeli vehicles. He said more serious offenders might be deported. The last time Israel resorted to exiling its political opponents was in 1980, when two prominent West Bank mayors were deported. At the same time, other officials said that Israel was looking for ways to satisfy U.S. requests to improve the quality of Palestinian life. That was one of the things President Reagan discussed with Prime Minister Shamir in Washington earlier this month. Robin?

MacNEIL: At his news conference this morning, the President was also asked about the trip planned by Democratic presidential candidate Jesse Jackson to Syria. Jackson is due to leave tomorrow at the invitation of the Syrians to discuss the release of captured Navy flyer Lieutenant Robert O. Goodman Jr. This was the President's comment.

Pres. REAGAN: Sometimes efforts of this kind can be counterproductive. We are doing everything we can and working as completely as we can diplomatically to bring about his release. And it's possible that sometimes someone with the best of intentions could change the balance unfavorably.

REPORTER: He's going to call you. Are you going to take his call?

Pres. REAGAN: Why, certainly, yeah. I wouldn't have any reason not to.

MacNEIL: Jackson himself went to the State Department today for a briefing before his trip, presumably to be told of efforts the U.S. is making through normal diplomatic channels to secure Goodman's release. Jackson has maintained that the government has not done enough. After his State Department briefing Jackson said he would not go in defiance of the President, but he indicated that he has not talked to the President directly.

Rev. JESSE JACKSON, Democratic presidential candidate: We have not yet talked with him, but he has made his desires very public that he would wish that at this point that we would not go, for our going could have some impact, some negative impact. We think that what has been called quiet diplomacy was in fact not very much diplomacy at all. But as a result of the efforts of the last few days we know that the issue is now on the front burner. And if we have had the impact already of getting this matter back on the front burner by Mr. Assad and Mr. Reagan, then we are much further along today than we were three or four days ago.

MacNEIL: Incidentally, Ronald Reagan became even more clearly a presidential candidate himself today, even though he's delayed a formal declaration of his plans until the end of January. Today the President formally entered both the New Hampshire and Illinois primaries. The New Hampshire entry, read in the state capital, Concord, was signed by Mr. Reagan himself and said: "I am a registered member of the Republican Party and I am a candidate for nomination for the office of president." Judy?

WOODRUFF: There was an extraordinary scene at a prison outside Rome today. Pope John Paul II sat down with the man who tried to kill him, and personally pardoned him. The Pope met alone with Mehmet Ali Agca, who is serving a life sentence for shooting him in St. Peter's Square two and a half years ago. Here is a report from Phil Davies of Visnews.

PHIL DAVIES, Visnews [voice-over]: The applause came from 700 inmates of Rome's top security Regina Coeli prison where Pope John Paul went on a Christmas visit. The prisoner giving him a gift to mark the occasion had just finished a short speech of welcome. After a prison service, John Paul went to the cell of the man who tried to kill him in May 1981. Mehmet Ali Agca is serving life in a jail somewhere in central Italy for the assassination attempt. He comes to Regina Coeli frequently to answer questions from magistrates still investigating the incident. This unprecedented meeting between a forgiving Pope and his would-be assassin lasted about 20 minutes. The cell door was open and Agca wasn't handcuffed. A. Vatican official later described the atmosphere as something like that in a confessional, without anger nor hatred.

WOODRUFF: At his trial, Agca said he acted alone in the assassination attempt, but he later charged that Bulgarian agents and the Soviet KGB intelligence service were behind the attack.

More questions about Soviet leader Andropov today. For the second day in a row he failed to appear at a meeting of the Communist Party's Central Committee. His absence, highly unusual from such an important party meeting, seemed to confirm that the 69-year-old Andropov is far more ill than official statements have acknowledged. However, efforts were made today to preserve the image of an active leader, with the issuing of government awards signed by Andropov as president. The fact that the Central Committee gave major promotions yesterday to four men generally considered to be Andropov supporters has only added to the air of mystery.Andropov has not been seen in public since August. Robin? Cold Wave -- Economic Costs

MacNEIL: The nationwide cold wave eased its grip a little today, but another blast of arctic air is said to be on the way. While temperatures rose slightly in the Midwest, the deep South got more freezing weather, glazing highways with ice and snarling traffic. Parts of the interstate and other highway systems in Alabama, Texas, Louisiana, Mississippi and Georgia were closed because of ice. Many Amtrak passenger trains were running at slow speeds because of brittle rails. On Lake Erie, ice breakers, normally not needed until late January, were out to free 15 freighters loaded with grain and coal. More than 300 deaths have been blamed on the weather over the past week, while citrus and vegetable growers are facing heavy losses. To tell us more about the economic impact of the cold spell we have Peter Leavitt, executive vice president of Weather Services Corporation in Bedford, Massachusetts. It's the largest private operational forecasting company in the country.It supplies weather information to agricultural producers, exporters, commodities brokers and utility companies. Mr. Leavitt joins us tonight from public station WGBH in Boston.Mr. Leavitt, can you tell us first, what has caused this extraordinary December cold spell?

PETER LEAVITT: Well, like many other aspects of weather, it's a combination of ingredients upon which we can blame our headaches this winter. The cold air originates in Canada, where the source region is now in a period of long or perpetual night, and the cold air filters down into the United States as it cools off and moves southward. And this influx of cold air is where the arctic air massess and the very cold temperatures originate. However, it takes more than just the normal cooling of air masses over Canada to produce the kind of temperatures we just experienced. This sort of movement happens about every winter. This winter, though, we have an additional ingredient in the pattern, and that is the presence of a large blocking ridge, as we call it, over western North America. Normally milder air moves in from the Pacific Ocean on westerly winds, and this milder air tends to moderate the cold air as it forms it the source regions up in Canada. This season, however, we haven't had that influx of milder air moving into the western part of the continent and into Canada, and the reason is that we've had a large high-pressure system over Alaska and the western portion of the country, diverting the mild Pacific air northward. As a result, the cold air has had a chance to get even colder over the Canadian source region and to travel unimpeded and unmoderated by these warm flows from the Pacific into the central and eastern part of the country.

MacNIEL: Would that explain why Alaska was warmer yesterday than parts of Florida, because the warm air which would normally come in from the west has been diverted up there?

Mr. LEAVITT: That's exactly right. You know, we can't get extreme temperatures in one part of the country or the world without seeing extremes of the opposite nature somewhere else.For example, in Western Europe today they've been having very mild, unseasonably mild weather there.

MacNEIL: There were daffodils blooming in London today, the news said. Now, what's going to happen now?

Mr. LEAVITT: Well, there's -- when you're trying to determine how to extend today's weather into the future, probably the best game in town is to use persistence. That is, the pattern, once established, is likely to persist, particularly a pattern that gets established in the latter half of December very often is a key to much of the winter season.

MacNEIL: You mean that high-pressure area over the Rockies there that you talked about, that blocking ridge, that could stay there for a long time you mean?

Mr. LEAVITT: Well, it will make frequent appearances. Once in a while it breaks down for a few days, but that is its mean, its average position over the Rockies and western North America, and that's where it will want to form, if we can personify it a little bit, rather than anywhere else. And so the pattern, once established, tends to be self-propagating.

MacNEIL: Now, what are the worst economic effects of this going to be?

Mr. LEAVITT: Well, of course, the effect on agriculture is immediate, where the cold weather has reached those areas of the country where crops are in growing conditions -- the southern border states. In Texas the crops destroyed vegetables and essentially wiped out the citrus crops there, where citrus is mostly provided for table use, for whole fruit use. In Florida the cold air has seriously damaged the citrus crop there as well. However, about 80% of Florida's citrus production goes into processing plants to be made into such processed foods as frozen concentrated orange juice.

MacNEIL: I read today that if they harvest the crop while it's still frozen, it can safely go into that use. Is that right?

Mr. LEAVITT: That's right. And as a matter of fact, if the weather would just remain very cool down there, then there would be only slow, if any, deterioriation of the crop while it lies either on the ground or still dead on the trees. And they can get those into the processors and make something that can be blended later to produce acceptable orange juice.

MacNEIL: So no problem really in the orange juice supply then, is that it?

Mr. LEAVITT: Not if these things happen, except that you don't get it all, because the crops were hit before the fruit on the trees had matured. Only about 10 or 15 percent of the crop has been picked thus far. Consequently the immature fruit just won't produce as much juice or pulp. And particularly the late fruit, the valencia crop to which we depend upon to provide the color and the best flavor of the frozen concentrated orange juice.

MacNEIL: That's vegetables and citrus; what about livestock?

Mr. LEAVITT: Well, livestock are greatly stressed during these kind of cold spells, because basically animals grown for food is really a large machine that converts vegetable matter into meat protein. And the colder the weather is, the more they have to ingest to maintain body temperature and weight production. What happens is, as it gets colder they don't put on weight as fast but they eat not even as much -- much more than they normally would. So their consumption of feed increases. And of course, animal mortality will be increased during these periods as well.

MacNEIL: Briefly and finally, how would you characterize this cold spell in historic terms?

Mr. LEAVITT: Well, this is the coldest December of this century. That now goes into the record books as such. Record temperatures were observed for the month of December in every state from Washington, Idaho, Montana, to the Gulf Coast. The coldest December temperatures ever observed.

MacNEIL: Well, Mr. Leavitt, thank you. And we'll be back in a moment.

[Video postcard -- Stillwater, Minnesota] U.S. Steel Closures

WOODRUFF: The U.S. Steel corporation announced today that it will close all or part of more than 20 of its plants, laying off more than 4,500 people. Eleven thousand other workers who had already been laid off will not be called back to work. The major plants being completely shut down are located in Cleveland; in Elmira, New York; Trenton, New Jersey; Pittsburgh, California; and three towns in Pennsylvania: Johnstown, Schiffler and Ambridge. All of these changes will save the financially strapped company about $650 million according to its chairman, David Roderick, who made the announcement today in Pittsburgh.

DAVID RODERICK, chairman of the board, U.S. Steel: Long-term profit and market potential have been the criteria for deciding which units will remain operating and which must close. Are we saying there would be a lot less closing if greater concessions would have been offered, the answer is yes, because it would have kept some of these things economic. All of them could not have been kept economic in our view merely by labor concessions, but certainly some of them fall in that category. I don't think there's any message there. What shuts down steel plants, of course, are economics. And anything that a steelworker can do to make his plant more competitive offers him a great deal of protection. And if he in effect does not make his plant competitive, then he in effect jeopardizes his own security. People that don't really understand the economic pressures that are out there in the marketplace are going to be people long-term that are not going to be working in the steel industry. It's just that simple.

WOODRUFF: Mr. Roderick's plan for U.S. Steel is being severely criticized by steelworkers and their union officials. Charlayne Hunter-Gault has more on that.

CHARLAYNE HUNTER-GAULT: Not surprisingly, workers at plants scheduled for shutdown or drastic cutbacks are particularly upset over today's news from U.S. Steel. At places like the Southworks plant in Chicago, which will undergo a severe reduction, talk of the plan had begun to heighten anxieties even before the announcement. We visited with a number of union members and officials employed there a few days ago, and this is what we found.

[voice-over] Last week, United Steelworkers Union Local 65 gathered for their annual family Christmas party. Like thousands of other parties held this season, it was a time for festive holiday traditions. But for these South Chicago union members, it was also atime for sadness. Eighty-five percent of their brotherhood is unemployed, and this will probably be the last Christmas party their union can afford.

MAN: Most of you have probably been laid off, and the ones that are working are fortunate. Most of our members are on unemployment, lost a lot of investments, and we're having a very tough year, or a couple of years.

HUNTER-GAULT [voice-over]: For nearly a century U.S. Steel's Southworks provided steady work and good wages for the members of Local 65. A skilled worker could earn up to $13 an hour, plus liberal fringe benefits. When U.S. Steel began losing money, it asked for and received concessions from the union. But when U.S. Steel recently asked for still more concessions, the union refused, even knowing the rejection could mean the end of their jobs.

DON STAZAK, union local president: I'd have a lot more respect for them if they were up front and said, "Look, we don't need this mill anymore, we're not going to keep it open any longer," and then I think we could accept that. But to play with us and toy with us until they decided to shut us down, I think that's despicable and I think that's something that we will never forget.

HUNTER-GAULT [voice-over]: U.S. Steel says it has to cut labor costs to stay competitive with foreign producers. But the workers in South Chicago think management has made many mistakes. Ike Mezo has been at Southworks for 10 years.

IKE MEZO, steelworker: They primarily never were competitive. They were a monopoly for many years. They sold their steel the same way Al Capone sold his beer -- "We've got it and you're going to pay for it, and if you don't like it, you don't get the steel." And this has driven their customers to overseas or to other ways of getting the steel.

HUNTER-GAULT [voice-over]: Joe Diaz, like his father and grandfather, joined Southworks right out of school and planned to make a career at the steel mill. But after 13 years he was laid off.

JOE DIAZ, unemployed steelworker: They didn't put no money into the mill. If they would have put money in the mill, they would have made some profit. If they would have had the right technology in that mill, okay -- the right machinery and everything like that, not running on just used ball bearings and stuff like this, all this old type machinery.

HUNTER-GAULT [voice-over]: Denise Sinnokek worked at the mill from 1972 to 1982.

DENISE SINNOKEK, unemployed steelworker: They really ask you to run the equipment without it being repaired, because they were in a hurry and we didn't have enough good equipment. And when you did this you were hurting the quality of the steel. That they would ask you to do things like this, and these machines were never replaced -- they were just constantly put back together with old parts; we almost never got new parts, new equipment.

HUNTER-GAULT [voice-over]: Jack McNeal has been an electrical linesman at Southworks for the past 15 years.

JACK McNEAL, steelworker: There's too much pressure on management from higher levels to pressure workers into doing work that they've never done before and combining jobs that they shouldn't be doing, because the big thing is push, push, push to get the job done with less people.

HUNTER-GAULT [voice-over]: A community that sustained generations of steelworkers has grown accustomed to living under the executioner's axe, but what angers the union members far more than the plant closings is the feeling that they were pawns in a game of concessions.

Mr. STAZAK: They were planning to close those plants regardless of what you do, and that's the thing that's frightening and that's the thing that's despicable, because I think you're playing with a lot of people's lives. I'm very disappointed with U.S. Steel.

HUNTER-GAULT: For more specific reactions to today's reorganization announcement we have Lynn Williams, interim president of the United Steelworkers Union. The union has close to one million members, a quarter of whom are laid off. Mr. Williams, what's your reaction to Mr. Roderick's statement today that economic conditions -- and he also said earlier in a segment that we didn't see that global market conditions forced them into this plan?

LYNN WILLIAMS: Well, there's no question that the whole business of imports from outside the country, particularly from low-wage Third World countries, is having a very important effect and a very difficult, damaging effect on steel markets here in the United States. So that's certainly part of it. I, however, think that we have in our own hands solutions to these problems in terms both of our corporations here in America and in terms of government policy in America, and I --

HUNTER-GAULT: Well, excuse me, before we get to those solutions, what about one partial solution that Mr. Roderick just alluded to, and that was greater concessions from the unions? Do you think that the unions did their part in this whole situation?

Mr. WILLIAMS: Oh, I think so, yes.Our union made major concessions last spring, concessions which amounted to between three and four billion dollars' worth of concessions to the industry overall. I think among the largest, if not the largest, concessions made by any major industrial group in America. So I certainly think the union acted very responsibly in that regard.

HUNTER-GAULT: In other words, you don't think that there was anything further that the unions could have done, as he seemed to be suggesting?

Mr. WILLIAMS: Well, there have been some local issue bargaining going on in some of these places, and there, of course, our members themselves have had the opportunity and have had to make decisions about what to do. I think what's fundamentally wrong and what must be understood is that the problems of industry in America are not going to be solved, cannot possibly be solved on the backs of the working people in America. There's a limit to what can be done in terms of concessions. These world market situations to which Mr. Roderick refers, for example, typical among them is Pohang Works in South Korea, a modern mill with a capacity of nine million tons, with labor rates of $1.80 an hour. Now, I don't think there's anybody in the country would expect steelworkers or any other workers in our society to reduce their labor rates to be competitive with those kinds of situations.

HUNTER-GAULT: Well, what do you think the solution is, briefly?

Mr. WILLIAMS: Well, I think, briefly, the solution is that first of all our corporations have to accept much greater social responsibility in this society. For too many years we have lived with the idea that any time we're in trouble, we'll lay people off and that's some kind of a solution. And of course it isn't; it reduces the productive capacity of our industry Secondly, I think we need a whole new set of national policies. Almost every other country in the world has an industrial policy, particularly in terms of their steel industry. By and large these industrial policies are targeted to the American market. By and large we have not, up 'til now, had any effective means of dealing with the import surges. We deal with it in one area. For example, the agreement covers some products coming in from Europe -- there is an agreement with Europe, covers those. But then the problem pops up in the Third World countries and comes in there at labor rates and at very low prices which depress the whole situation here. We need an industrial policy in America.We need to make a decision here as to whether or not we want to have basic industry. We have to stop this deindustrialization process which is seeing our major industries wiped out. It's impossible to have a modern, successful economy without a steel industry at its base. That's why these other countries are so interested in building up their steel industries, while we're watching ours disappear. It's a terrible policy mistake, and we must all do something about it.

HUNTER-GAULT: All right. Thank you, Mr. Williams; we'll come back. Judy?

WOODRUFF: We invited U.S. Steel to send a representative to appear on the program, but they declined. We will hear a different view, however, from Robert Crandall, a senior fellow at the Brookings Institution here in Washington who specializes in the steel industry. Mr. Crandall was involved in formulating steel policy for the Carter administration and he's written a book called The U.S. Steel Industry in Recurrent Crisis, Mr. Crandall, what U.S. Steel did today, was it absolutely necessary for them to survive?

ROBERT CRANDALL: Well, it was inevitable at some point that they make some difficult decisions to close some plants. Whether the decisions they made today were absolutely necessary for them to survive for the next year, I don't know, but obviously decisions like that have to be made and they have to be made fairly soon.

WOODRUFF: Was there anything more that U.S. Steel should have done to prevent the decline that has led to the situation they're in today?

Mr. CRANDALL: Well, the situation all the U.S. steel companies, and for that matter, all steel companies around the world, are in today is driven by the fact that steel demand has been so weak over the last 10 years. You have to remember that steel demand today is lower than it was 10 years ago, and we aren't going to come back to mid-'70s -- '73, '74 -- levels probably for another two or three years. In '73 or '74 forecasts were that steel demand was going to grow relatively rapidly over the next decade. Those forecasts were wrong. Decisions were made that unfortunately proved to be wrong, and now we have to make the cutbacks.

WOODRUFF: Do you agree with Mr. Williams that something is going to have to be done in terms of a government policy, some sort of national industrial policy, and that also there will probably have to be some sort of import restrictions to help the entire industry survive?

Mr. CRANDALL: No, I think that unfortunately we've tried that too long, and the effect of those import policies, if they work, is to increase the cost of production for our steel-using industries, like automobiles, farm machinery, industrial machinery, home appliances, and to make them noncompetitive in the world. We simply can't afford to do that, so I don't believe we can go down that road.

WOODRUFF: Well, what do you think is necessary then? I mean both for U.S. Steel and for the industry as a whole.

Mr. CRANDALL: Well, I think we have to come to some difficult choices, the sort of choices that U.S. Steel came to today. They're going to have to focus their investment decisions on their better plants, and we're going to have to acknowledge that there's a new steel industry growing out there, the small companies, the so-called minimills in the United States, which are rapidly taking away the lower end of the market from the big companies, and which are thriving and which are prospering without any trade protection.

WOODRUFF: Are you saying that we've seen -- we're going to see the end, the last of the big steel companies?

Mr. CRANDALL: We're not seeing the end of them any more than we've seen the end of the railroads. But we're seeing the beginning of what happened to the railroads, which is a slow, inexorable, painful decline.

WOODRUFF: How do the unions fit into this -- the Steelworkers Union, how does it fit in?

Mr. CRANDALL: Well, at a time when the view of the world steel markets was much more optimistic than today, they successfully negotiated for very high wages. They managed to get their wage rates up to a level of 70 to 80 percent above the manufacturing average. That's far too much now for these companies to be able to compete with the Pohangs of the world that Mr. Williams talked about. And as a result we're seeing a slow but steady, I think, decline in that premium over the U.S. manufacturing wage.

WOODRUFF: And what is all that going to mean in terms of jobs? Are we going to see a further loss?

Mr. CRANDALL: Well, we'll see some recovery, obviously, as the economy recovers, the capital goods sector recovers. But remember, even if we have a good year next year, steel employment in the United States won't even be half of what it was 18 years ago.

WOODRUFF: Well, so you're saying what -- how many more jobs lost?

Mr. CRANDALL: Well, I'm saying that in fact we may lose some more jobs -- we'll probably see actually some increase in employment over the next year -- but the long run holds for probably a one to two percent annual decline in the number of steel jobs in the country.

WOODRUFF: And what's to happen to those workers who have lost their jobs and won't get them back?

Mr. CRANDALL: Well, that's a difficult problem, and I'm not sure how we handle those problems in cities like Youngstown or Johnstown, cities which have been very heavily dependent upon steel employment. It's a very difficult problem.

WOODRUFF: But basically, as I understand it, you don't have any problem with what U.S. Steel did today. You think it was the right, it was the necessary move.

Mr. CRANDALL: Well, for the future of U.S. Steel and for the efficiency of the U.S. steel industry it was certainly the right move. For people who are laid off as a result of that, it's a very unfortunate decision. But I'm afraid that many of these facilities that U.S. Steel has closed would have to close anyway at some time in the relatively near future.

WOODRUFF: All right. Thank you, Mr. Crandall. Charlayne?

HUNTER-GAULT: Mr. Williams, Mr. Crandall says that these plants, that the demand for steel was just so weak that there was no way that these plants could have continued operating at the capacity that they were. What do you say to that?

Mr. WILLIAMS: Well, Mr. Crandall's prescription is a prescription for disaster for our entire society, not just for steelworkers. If you eliminate the kinds of good jobs that steelworkers have had in the steel industry, you take the large part of the base out of our entire society, and that ultimately will affect everybody in the society. He's right about there being enormous overcapacity in the world. That's true. One of the ironies is that the reason there's overcapacity, that our investment community in this country, aided and supported by government policy from time to time, has encouraged investment in these Third World steel mills. And new steel mills are still being built in the Third World. It makes no sense.It makes no sense for us in terms of adding to this overcapacity in the world. It really makes no sense for the Third World countries either, because they're being encouraged to built facilities for which there isn't any market.

HUNTER-GAULT: Mr. Crandall, yours is a prescription for disaster?

Mr. CRANDALL: Excuse me, those are the words which I just used a few days ago in describing a proposal for trade protection, for quotas. I don't think it's a prescription for disaster. In fact, I don't think that Mr. Williams' view that all the basic industry in the United States is declining. What we have to face up to the fact, though, is that our metals industry in particular are declining, and there's probably no way to revive them. Only metals and textiles and perhaps automobiles are in serious long-run trouble. If you look at the rest of basic industry, it's doing rather well, except for the effects of the recession and the high value of the dollar.

HUNTER-GAULT: So you see other steel plants going to same route of U.S. Steel?

Mr. CRANDALL: I think there will be some other closures. There are people who are forecasting as little as 90 to 100 million tons of integrated steel capacity in the country, as opposed to, say, the 125, 130 million tons that we have right now.

HUNTER-GAULT: Mr. Williams, Mr. Crandall said of your proposal for having an industrial policy that we simply can't afford that, that it will increase the cost of production beyond what it even is now.

Mr. WILLIAMS: Well, I would suggest, first of all, when he says that, well, all that's affected is the steel industry and the metal industries in America and the automobile industry, he's talking about an awful lot of basic industry in the United States. Our union represents people in a great many industries and we've seen our overall membership -- now, this just isn't in steel; this is in general manufacturing, in nonferrous and all number of the basic industries in this country -- we've seen our membership go down from over a million to 700,000 dues-paying people. That's an enormous number of people who have lost their jobs. Industrial policies are working in a great many countries in the world. The total Japanese --

HUNTER-GAULT: But he says that -- excuse me, he says they've already been tried here and shown not to work.

Mr. WILLIAMS: Oh, well, that's nonsense. No one here has tried in any effective way to put an industrial policy together. There have been some attempts at some kind of control of imports. And as a matter of fact, in specialty steel, for example, where we had quotas a few years back, that revived the speciality steel industry in America. And at this moment, where we have quotas in some part of the specialty steel industry, it's doing very well. The record is that these sorts of things work. If we didn't have an informal quota arrangement with the Japanese, the American steel industry would be in a lot more serious difficulty than it is at this moment.I don't know how Mr. Crandall can honestly say that these policies aren't working.

HUNTER-GAULT: Mr. Crandall, do you have evidence to the contrary?

Mr. CRANDALL: Well, the rate of decline in most steel-using industries has been even more rapid than it has been in the steel industry itself, in terms of the penetration of imports. What we can't allow to happen is for the price of steel to rise in this country relative to what is available in, say, Japan or in Europe or in Third World countries. Otherwise we're going go have to start protecting our farm machinery industries, provide more protection from imports for our automobile industry, for our home appliance industry, and simply raise --

HUNTER-GAULT: Are you saying that once you start the process of protection, it's just going to have a domino effect?

Mr. CRANDALL: Certainly, certainly. In order to protect the textile industry we have to protect all the clothing industries --

HUNTER-GAULT: Well, what would be bad --

Mr. CRANDALL: -- at substantial cost. Well, it just simply raises the cost and reduces the standard of living for most Americans in order to protect the jobs of a few.

HUNTER-GAULT: Mr. Williams?

Mr. WILLIAMS: Well, Mr. Crandall, he says this from the point of view of working in one of the most protected and subsidized industries of all, I believe, our educational establishments. But as a matter of fact, our textile industry works under a multifiber agreement. And if we hadn't had the multifiber agreement, which really coordinates world trade in this field, the textile industry would long since have disappeared in America. So I really think he speaks quite inaccurately. These policies we have had in place, as I indicated, and he hasn't addressed himself to that, have in fact worked. Just think where our automobile industry would be if there was not a limitation on imports from Japan and if Japanese cars were simply flooding in here. The fact of the matter is, in terms of steel prices that they are now being depressed to Third World levels. They're not being depressed to Japanese levels or European levels or Canadian levels; they're being depressed far below that. They're being depressed to the levels that are relevant to people who can produce steel with labor rates of $1.80 an hour. That just makes no sense for us.

HUNTER-GAULT: Mr. Williams, let me ask you on the final point, one of the final points that Mr. Crandall made, that really the focus now should not be on these older plants, that you just have to concede that they're going to have to close, and as painful as it is, some jobs are going to be lost; that you have to focus on these new plants which don't have the same union encumbrances and so on that the older plants have. What's your reaction to that as a strategy for the future?

Mr. WILLIAMS: Well, first of all, people matter most. And Mr. Crandall has absolutely no answer for the people, and 15,000 more of whom today, after more than 100,000 over recent years, have received this kind of news.So I think you've got to think about the people. Of course there has to be modernization and investment, but why shouldn't it be in the old plants and in the old localities? Why should we let the infrastructures of the Youngstowns and the Homesteads and the Braddocks and the Aliquippas and all of these communities -- why should we let that just go to waste, why should we not put the investment there?

HUNTER-GAULT: Do you feel that --

Mr. WILLIAMS: We do believe in the union, incidentally, in terms of quota legislation; we do believe very much that there should be linkage to modernization, that any period in which we operate under quotas, that the benefits of that quota legislation should be invested back in the industry, just as we insisted in terms of our concession negotiations that the benefits be invested back in the industry. We do need investment, we do need modernization, but it should be in the existing communities.

HUNTER-GAULT: Mr. Williams, we only have a few seconds, so if you could answer briefly. Do you think there's anything now that could stave off these closings and cutbacks? We have about 10 seconds.

Mr. WILLIAMS: I think if the federal government decided to rebuilt the infrastructure of America, to rebuilt the bridges, to rebuilt the sewers, to rebuild the highways, to fix up the public facilities, we could put the steel industry back on its feet with that kind of action alone.

HUNTER-GAULT: Unfortunately, Mr. Crandall, in a yes or no word, do you agree or disagree?

Mr. CRANDALL: I rather doubt it. A little bit of that would help, but I rather doubt it would put us back to even the late 1970s.

HUNTER-GAULT: All right, on that note of pessimism we have to end it there. Thank you, Mr. Crandall and Mr. Williams. Robin?

MacNEIL: From steel to the auto industry. Ralph Nader's Center for Auto Safety today asked the government to open a fullscale investigation into reports of sudden uncontrolled acceleration in certain General Motors cars. The Center, a private group founded by Nader, claimed that the National Highway Traffic Safety Administration has been stalling by sitting on a defect that may be in 19 million cars. In a letter to the agency, the Center said some GM cars dating from 1977 to 1982 accelerated suddenly when shifted from park into gear, causing serious accidents. In a statement, the highway agency said it had been investigating the problem of GM cars dating back to 1971, but had been unable to identify what it called a definable defect. A spokesman for General Motors said it had reports on sudden acceleration but regarded it as driver error problem, not a mechanical defect. We'll be back in a moment.

[Video postcard -- La Connor, Washington] Sendak & the Nutcracker

MacNEIL: For decades, this holiday season has been the time for ballet companies all over North America to mount their annual production of the Nutcracker Suite. In fact, the traditional Nutcracker, with music by Tchaikovsky and 19th century choreography by Marius Petipa has become a breadwinner for struggling ballet companies, for some the only profitable production all year. And audiences never tire of the Dance of the Snowflakes and the Waltz of the Flowers. But this season the Seattle Opera House has something different -- a brand-new Nutcracker conceived and designed by the children's writer and illustrator, Maurice Sendak. He went back to the original fairytale written in 1816 by the German E.T.A. Hoffmann called The Nutcracker and the Mouse King. Nutcrackers like this, in the form of a toy soldier, were common children's toys. Sendak says the new version, instead of a ballet for children, is a ballet about children.

MAURICE SENDAK, author and illustrator: So what we've done was go back to Hoffmann and see how much more of the tale, the fairytale we could get into this version, because we like the original fairytale very much.It's much juicier, darker, and has a quality to it which I never found in watching the Nutcracker. The ones I've seen have been dull. I mean, bluntly, it's -- you have a simpering little girl, you have a Christmas party, you have a tree that gets big, and then you have people doing a variety of dances at the end that seems to go on ad nauseam. There is no plot, there is no logic; there's lots of pretty music, but I don't enjoy it, because I'm a very pedantic, logical person -- I want to know why things happen and why is she doing this and why is she feeling that.

MacNEIL [voice-over]: In Sendak's own original stories like Where the Wild Things Are, his small heroes and heroines struggle with the demons of childhood. They confront scary situations peopled with strange beasts and strange locations, and learn to cope with them. In every story the young protagonist is touched with fear or anger, overcomes it, and grows braver and wiser because of that.

Mr. SENDAK: It would be very typical that this happens to every child. This is not an unusual occurrence. This is life. A kid stumbles against something he has had no experience with -- what do you do with it? If your parents don't explain it you have to explain it to yourself, and you often explain it in an illogical fashion, but it suits you, comforts you, and you get through to the next moment.

I have an enormous respect for children and their ways of dealing with the difficulties of life, and I tend to believe they deal with them more honestly, more courageously than we do, meaning adults. Children, that's what interests me.

MacNEIL [voice-over]: Like the child in this scene from the new Nutcracker, where Sendak tells the story of a young girl dealing with a frightening experience, as the children do in his books. Here he has reworked not only the traditional ballet but also the original fairytale into his own interpretation. For Sendak the idea of applying his imagination to the story of Clara, the young heroine of the Nutcracker, and her strange dream, made the ballet a Sendak story.

Mr. SENDAK [voice-over]: As soon as I saw what I could do with her, then it became something for me. I could become part of this; I could join Tchaikovsky, Hoffmann, Kent and become a vital part rather than merely decorate another Christmas tree.

MacNEIL [voice-over]: Kent is Kent Stowell, the artistic director and choreographer of the Pacific Northwest Ballet. It was Stowell who conceived the idea of producing a new Nutcracker, and above all, a different Nutcracker.

KENT STOWELL, artistic director: My position was, let's not do just another Nutcracker; if we're going to go into the business of producing Nutcrackers, let's make it the last of the Nutcrackers, so to speak.

MacNEIL [voice-over]: For that, the obvious choice was Maurice Sendak.

Mr. SENDAK: I had to do sets and costumes, which in and of themselves are important only in that they mean something. I mean those costumes can't just be pretty, those sets can't be pretty -- who cares about that unless they imply something else. You see what I mean?No point just setting it; it's got to mean something, it's got to signal to everybody sitting here that there's something about this that is strange, and beautiful -- not pretty, but beautiful. And Kent has to come in and choreograph the same mood. We have to take these very heady, realistic things and create some kind of spiritual thing that's only in our head, okay? Then we have to communicate that to hundreds of people.

MacNEIL [voice-over]: Sendak spent over two years on the production, which cost more than half a million dollars. His conception required the skills of dozens of people in all the backstage crafts of music, dance and theater. Fifteen pairs of hands sewed 180 costumes, each individually designed by Sendak. Like the personal outfits for each member of a whole churchful of mice, and for the peacock, a new character created by Sendak, and the tiger, another new Sendak creature.

Mr. SENDAK: Most Nutcrackers are set in a later period -- sort of Charles Dickensy England or Charles Dickensy Germany -- and it's a more Victorian setting with big skirts and hoops and bonnets. That to me is heavy and straightlaced. Because this story is not straightlaced at all; this story is very wild.

My giant nutcracker head who appears at the very beginning of the prologue is to me very much in keeping with other heads that have interested me, which start back in its early source to Mickey Mouse. I mean the first head I ever saw as a child was Mickey's head on the screen -- an enormous head with a big grin. Now, Wild Things heads from my book have that same gleaming enormity -- big eyes and great staring qualities. So that really comes from me. Now, I adapted the head that has reappeared ad nauseam in all my books to the nutcracker head. Now, the nutcracker head has to have certain things, mainly the teeth. But the eyes, the nose and the expression comes from everything I have done.

MacNEIL [voice-over]: For three months, four painters decorated the seven sets to match Sendak's sketches, with colors mixed by hand to Sendak's specifications. Kent Stowell, the artistic director, calls Sendak's Nutcracker the most complicated ballet production in the United States today.

Mr. STOWELL: The quality of beauty that's in every scene is unbelievable. Because first of all, he's an artist, so he understands color and power; and then the theatrical dimensions of his mind in relationship to all those elements in the Nutcracker.

MacNEIL [voice-over]: But for the backstage crew it wasn't always easy to make Sendak's concepts work in the real world of gears and weights and carpentry. The wooden waves for the opening of act two would not undulate until they were properly balanced. And the boat would not sail upon those waves until a few hours before the opening curtain. Patience, and an impatient kick, plus a bit of tinkering, solved the problem.

For Sendak's scenario, the ballet organized a company including 156 young dancers, in addition to the 32 regular members of the Pacific Northwest Ballet. Just marshalling the youngsters for their entrances was a major job. There are four girls who fire the artillery, six who ride in the cavalry, 16 who march in the infantry, 16 servant children, and 19 mice in various shapes and sizes. Only 90 of the children dance in each performance, but that makes 90 small faces to be made up, again according to written instructions from Maurice Sendak.

In the dressing room on opening night the youngsters were eager and nervous. For students of ballet, performing in a new production of Nutcracker was both a wish come true and a challenge to learn something new.

Mr. SENDAK [voice-over]: I feel much more anxious at this moment for the dancers, for the children, for the first time being out in front of an audience. The whole thing now weighs on them. I mean, I'm up there already. I've gone through my sturm und drang. I mean, my anxiety attack, my pleasure, my disappointment, my excitement.

MacNEIL [voice-over]: But just before the curtain went up for the premier, Sendak was still pacing about backstage, checking on last-minute details.

Mr. SENDAK [voice-over]: It's like that scene from The Wizard of Oz, the old movie when the witch takes the hourglass, turns it around, the sand is trickling and she says, "Dorothy, when those few sands are out, you're done for." This is like two years of sand coming out, and now here it is. It's implacably coming to the moment when we said it was going toopen on December 13th, 1983, and who would have believed it would have come.

MacNEIL [voice-over]: The climax of the ballet is the battle scene, where the toy soldiers of the nutcracker prince battle the regamuffin troops of the giant mouse king, and the mice seem to be winning. This is the central theme in Sendak's work -- the crisis in the life of a child, how that crisis is resolved, and what that resolution means to the child.

Mr. SENDAK [voice-over]: It may take two hours in the theater and a tremendous amount of work on everybody's part, but the feeling or the idea behind it -- it happens in Clara's head and takes all of two minutes. She lies down in that bed at the beginning of the prologue, she goes into a doze, she has a semi-dream-nightmare, she wakes up two minutes later and the ballet is over. And we don't know whether she's dreamed it, gone through it -- it's a moment in a kid's life. That's what interests me.

The prince is not winning the battle. I mean, he's tired, there's a tremendous battle, and then when that thing appears -- this little man, how is he going to possibly -- and you see him futilely dueling. She then takes off her ballet slipper or shoe and hurls it at him [the mouse] and kills him. That doesn't make any sense, except it makes sense in a very crucial way, which is that up 'til that point she's a frightened and confused little girl; suddenly she ain't. She's now in love, and she's brave, and she's forgotten her own self and she has dumped her own ego, and she sees that he's in trouble, and that's what the shoe means. No shoe is going to kill a giant mouse, but heroism will. And in the face of hopeless odds, she takes her shoe and it makes you love her. What kills the mouse is strength, is courage -- her courage. And so that's why she becomes a woman seconds later -- she has earned becoming a woman; she has earned maturity; she has crossed the bridge into maturity at that point. That's what this whole ballet is about: what's it like to have guts.

MacNEIL [voice-over]: Then, as Clara's fantasy draws to its end, she is grown up, mature and beautiful, sitting calm and poised and unafraid with her prince as they watch a treat of entertainment from Sendak's always original imagination.

WOODRUFF: That's wonderful, obviously for children of all ages. Turning now to a final look at today's top stories, President Reagan said that Marine and Pentagon officials will not be punished for security lapses that allowed a truck bomb to kill 241 Marines in Lebanon last October. Meanwhile, a ceasefire appears to be holding between Moslem militiamen and the Lebanese army in Beirut.

U.S. Steel announced a major restructuring. The nation's largest steelmaker says that it will cut its workforce by more than 15,000 and will completely close 14 plants.

The cold weather is still having its impact around the nation. Analysts say the freeze will be felt in the nation's pocketbooks.

And in a remarkable meeting in a Rome prison, Pope John Paul II met with and pardoned the man who tried to assassinate him, Mehmet Ali Agca. Robin?

MacNEIL: Before we go tonight we thought you'd like to have a little update on Jim Lehrer, who suffered a mild heart attack two weeks ago today. He's been making very good progress, and today he went home from the hospital. He'll be taking it easy for some weeks, but his doctors expect him to make a complete recovery. Jim says he's been deeply touched by all the messages viewers have sent wishing him well. Good night, Judy.

WOODRUFF: And that's good news. Good night, Robin. That's our NewsHour for tonight. I'm Judy Woodruff. Thank you and good night.