The MacNeil/Lehrer NewsHour

MR. LEHRER: Good evening. I'm Jim Lehrer in Washington. After our summary of the news this holiday evening, we have an update on the fighting in Bosnia, an Elizabeth Brackett report on the Midwest floods, how the Washington budget balancing storm appears to Doris Kearns Goodwin, Michael Beschloss, Haynes Johnson, David Frum, and David Gergen, and an Amei Wallach essay about an exhibition of stolen art. NEWS SUMMARY

MR. LEHRER: The United States and Britain have ordered more troops to the area around Bosnia. Rebel Serbs are now holding hostage 367 UN peacekeeping troops in retaliation for two NATO air strikes last week. Two thousand U.S. Marines were moved to the Adriatic Sea just off the coast of Bosnia. The Marines, from Camp LeJeune, North Carolina, will join the aircraft carrier Theodore Roosevelt. National Security Advisor Anthony Lake said the move was a precautionary measure and no decision had been made to send them into Bosnia. The British have ordered 1200 soldiers to Bosnia in the next three weeks. They join 3300 British already there as part of the UN force. Britain's defense minister talked about their mission.

MALCOLM RIFKIND, Defense Minister, Great Britain: There are rules of engagement which are quite clear, but, of course, one always has the right to defend oneself. They're not there as participants in a war. They're not fighting a war, but like all other UN personnel, they have the right to defend themselves and to use whatever military means may be necessary for that purpose.

MR. LEHRER: On the diplomatic front, Sec. of State Christopher met with his counterparts from France, Britain, Germany, and Russia, to discuss the Bosnia situation. European foreign ministers meeting in Brussels issued a statement supporting a tougher military stance. And UN chief Boutros Boutros-Ghali is expected to present new proposals on the peacekeeping mission to the UN Security Council. In Bosnia, Serb forces today shelled the main road western troops would use to reach Sarajevo from the port city of Split. The death toll is still unknown from yesterday's earthquake and far Eastern Russia. Rescue workers searched for survivors on Sakhalin Island. We have a report from Julian Manyon of Independent Television News.

JULIAN MANYON, ITN: From the air, the small oil town of Neftegorsk looks as if it has been leveled by a giant hand. Whole blocks of flats have simply collapsed into rubble. Slabs of cements lie piled in heaps and crushed between them mattresses, cookers, television sets, all smashed wreckage of previously normal lives, and among it all, the bodies. More than 300 have so far been found, and it is certain that far more, perhaps as many as 2000, remain to be recovered. Rescue work went on all day and continued through the short northern night. Teams of men using all kinds of heavy equipment from the oil fields pulled at and bulldozed the rubble, sometimes tearing at it with their bare hands. More families have been found dead together, killed in seconds as their world suddenly fell in on them. Many survivors remain deep in shock. Displays of open grief are still rare. That will doubtless come later. Some here have already pointed out that the tragedy owes much to the Communist era. The shoddy Soviet apartment buildings were totally unsuited to an earthquake zone.

MR. LEHRER: The weather was heard from today. There was more flooding in the central part of the United States. More than 100,000 acres of farmland are underwater along the Mississippi River in Tennessee. In West Central Illinois, workers tried to shore up levees along the Illinois River, which has risen at least eight inches since Saturday. In Central Texas, there was flashflooding. Two men were rescued from Trinity Creek in Austin last night. The flooding continued there today. More than five inches of rain fell this morning. Tornadoes did the damage overnight in Ohio, Indiana, and Michigan. The West Texas town of San Angelo was also struck. Forty-seven people were hurt there. We'll have more on the Midwest floods later in the program. Former Senator Margaret Chase Smith died today. The Maine Republican was the first woman to serve in both the House and Senate. A leading moderate Republican, she was elected to the Senate in 1948 and served until 1972. She suffered a stroke last week. She was 97 years old. The Postal Service marked Memorial Day by issuing a new stamp. It honors prisoners of war and those Missing in Act. The stamp was unveiled at a White House ceremony this morning. President Clinton spoke about efforts to account for Americans still missing from the Vietnam War.

PRESIDENT CLINTON: On this Memorial Day, as every year, we also remember those who answered the call but never came home. Their loss is the greatest cost our nation has paid for freedom. We know very well our obligation to them and their families to leave no stone unturned, as we try to account for their fate and, if possible, to bring them home. We have worked hard and made good progress. We have put the issue of MIA cases ahead of all others in our dealings with Vietnam, and today, I am proud to say that we are receiving more cooperation from Hanoi than ever before. And we will not stop until we have taken every possible stop for every MIA and every MIA family.

MR. LEHRER: Later, Mr. Clinton went to Arlington National Cemetery. He participated in the traditional Memorial Day wreath- laying at the Tomb of the Unknowns. He spoke of those who died in all of America's wars.

PRESIDENT CLINTON: They fought so that we might have the freedom which too many of us take for granted but at least on this day we know is still our greatest blessing. At this sacred moment, we put aside all that might otherwise divide us to recall the honor that these men and women brought to their families and their communities, and the glory they bestowed upon our beloved nation. ["TAPS" being played on trumpet]

MR. LEHRER: And that's it for the News Summary this holiday evening. Now it's on to a Bosnia update, the new Midwest floods, the long view of balancing the budget, and a most unusual art exhibit in Russia. FOCUS - CONFRONTATION

MR. LEHRER: Bosnia is first tonight. Over the weekend, more than 300 UN peacekeepers were taken hostage by Bosnian Serb troops, and the Bosnian foreign minister was killed when his helicopter was shot down. Today, there was reaction in several European capitals. Michael Nicholson of Independent Television News has our report.

MICHAEL NICHOLSON, ITN: The Serbs' killing of the Bosnian foreign minister shooting down his helicopter over Bihac adds crisis to crisis in a war that seems to have no ending. As they know in Tuzla, the Northern Bosnian city shelled by the Serbs last Thursday in retaliation for the NATO bombing. Today, they buried the 70 who died. Today they were shelled again. The Serbs reckon they have paralyzed any further UN or NATO action against them, and grabbing UN soldiers from their isolated observation posts, OP's, is the way.

GARY COWARD, UN Spokesman: A number of OP's, eight of them, in the North, Northeast, and the East of Gorazde town, itself, were approached by the Bosnian Serb army, threatened, and immediately afterwards the OP's endeavored to extricate themselves from their isolated situation. A number of OP's managed to make it into safety. A number didn't. This is wholly unacceptable behavior on the part of the Bosnian Serb army. We demand that they're released unconditionally immediately. Whilst they're being held, they should be treated properly, not held as hostage, not held as human shields, and certainly not threatened with weapons, as a number have been already.

MICHAEL NICHOLSON: There are already three and a half thousand British troops in Bosnia monitoring the UN so-called safe zone. Then they'll be joined by the first of fourteen hundred men for the 19th Field Regiment who leave Colchester tomorrow, followed by 350 royal engineers, and expected to follow them, five and a half thousand men from the 24th Air Mobile Brigade. The message to the hostage takers is clear enough.

MALCOLM RIFKIND, Defense Minister, Great Britain: We've said to the Bosnian Serb leadership that the holding of British personnel as hostages is despicable, it is the sort of action that you associate with terrorism, not with the normal conflict, that the health of our British personnel is in vital British interest, and there would be very severe consequences if they were harmed. You would not expect me to speculate at this moment in time in public as to what might follow.

MICHAEL NICHOLSON: The french foreign minister, Alain Juppe, criticized last week's bombing of the Serbs but said the UN must toughen its mandate if the French, the largest contingent, are to stay, a clearer ultimatum. The Serbs put more of their French hostages on show today, their army cameramen emphasizing their handcuffs and their despair, men who obeyed the UN mandate to remain neutral on the ground as NATO planes bombed from the air. Outraged at pictures like these, the French government is under public pressure to order a unilateral withdrawal from Bosnia. In the Bosnian Serb headquarters in Pale bombed last week, their political and military leaders, Radovan Karadzic and Gen. Ratko Mladic were defiant. They keep their captives until the bombings stop; they hold the trump card. Meanwhile, the biggest show of naval force is coming together in the Adriatic. The French carrier, Fauche, with its assault helicopters and fighter bombers, the American Theodore Roosevelt, whose planes have already been used in NATO attacks on the Serbs, America's also sending two thousand Marines out later this week, and the Royal Navy's Illustrious, armed with its sea harriers. Such a combined sea and land force now offers the UN a new option.

JONATHAN EYALL, Analyst: The point is to have the troops on the ground and the technology to be able to either pull them out very quickly or to allow them to fight back any offensive.

KOFI ANAN, United Nations: We are at a very critical stage, and it could be described as a state of crisis, but we will persist.

MICHAEL NICHOLSON: As the crisis spirals, the European allies are agreed at least on one thing to protect their troops on the ground, that if the Bosnian Serbs continue their brinkmanship, they either get tough or they get out.

MR. LEHRER: We're planning an extended look at the Bosnia situation tomorrow night. FOCUS - HIGH WATER

MR. LEHRER: Now, the Midwestern floods. The Missouri and Mississippi Rivers are again out of their banks, flooding much of the same area hit hard during the Great Flood of 1993. Elizabeth Brackett reports from St. Charles County, Missouri, where the Mississippi and Missouri Rivers come together.

ELIZABETH BRACKETT: No one thought they would be hauling sandbags again, at least not so soon after the Great Flood of 1993, a flood that was supposed to occur only once during a 500-year period. Two years later, these farmers in St. Charles County just outside of St. Louis were facing the third worst flood in the history of the Mississippi and Missouri Rivers. The high water was lapping at the levees Gary Machens helped repair after 1993.

GARY MACHENS: It's supposed to crest tomorrow, the river. If we can keep that from going over the top and eating a big hole, we're going to save a lot of money in repairing the levee system.

MS. BRACKETT: The Machens' home was still dry, but Elizabeth Machens was nervous. The images of 1993 were still vivid. Then water had been up to the roof of their home for six weeks, and she found a foot of mud when she returned.

ELIZABETH MACHENS: [July 1993] Oh, it's disgusting. I don't know how we're going to get it cleaned out. I just can't imagine.

MS. BRACKETT: But the Machens had made changes since then. They used the 4 percent Small Business Administration loan made available to 1993 flood victims to help finance the cost of raising their home above the 100-year flood level. The living quarters and all utilities were up out of harm's way. About 10 percent of West Alton residents had also raised their homes.

ELIZABETH MACHENS: I still am nervous about the water coming up. I don't like the idea of the water coming up. It's ruined all of our crops again. But as far as security of the family, I feel like we're much safer.

MS. BRACKETT: In the late afternoon, an exhausted Gary Machens heard ominous news.

GARY MACHENS: All around the Missouri River, we heard there was a big hole that just washed into a levee, about a 600-foot gap.

MS. BRACKETT: What's that mean for the town?

GARY MACHENS: We have about two hours, and then you'll see water in here. Where we're standing, they'll probably be about three foot of water here in the morning.

MS. BRACKETT: Machens was right. By the next morning, floodwaters were pouring through the railroad viaduct and into town. The Machens' house stood in three feet of water, but inside the water was not causing major damage. It would again be a mess to clean up, but there would be no need for new construction, and a new comprehensive flood insurance policy would cover the damage.

MS. BRACKETT: How glad are you now that you've raised this house?

ELIZABETH MACHENS: Extremely. I think we're really, really glad that we did it. You know, it was a big financial step to take but I think for the personal relief of it, I'm glad. It's still upsetting. It's still upsetting to see your family and your friends to go through it, and your neighbors to go through it, and, you know, you still lost crops again.

MS. BRACKETT: In West Alton, there were fewer friends and neighbors going through it again. After 1993, the Federal Emergency Management Agency, or FEMA, bought out about half the flood-damaged homes in West Alton and in St. Charles County. The buyout program was a major part of a new federal emphasis after 1993 to get as many people off the floodplain as possible. Nationally, $250 million was spent to buy out 8,000 structures. Missouri Governor Mel Carnahan says the buyout program is part of the way policies have changed since the last great flood.

GOV. MEL CARNAHAN, [R] Missouri: We learned some lessons, and we were determined not to repeat the same things every year, so one of the things we pursued was an aggressive buyout program for those that were hopelessly in the floodplain. And we had parts of 48 communities in this state with buy outs, with thousands and thousands of homes. And so this time, while we have a huge amount of water far too soon, we have considerably less human misery and human displacement.

MS. BRACKETT: 43 percent of St. Charles County is in the 100-year floodplain. With the rivers only about two feet lower than the record 1993 levels, much of the county was again under water, but because of the buy out program, damage estimates were expected to be far lower this time. Jerry King ran the buy out program for the county.

JERRY KING, Director, Buy Out Program: I think the buy out program did accomplish its major purpose, which was to remove as many families from the floodplain as possible. We received around $24 million in funding, including buy out, demolition, and relocation assistance, and we are going to spend virtually every dime of that, and yet, there are not a lot of people out there who wanted to be bought out who we haven't been able to buy out.

MARY ELDER: [in boat] It's gonna get on it. If it keeps a raisin' I think it's going to get on there.

RUSSELL ELDER: Only got three inches.

MS. BRACKETT: But half the people did not want to be bought out. They remain on the floodplain. Russell and Mary Jane Elder own a tavern and a home one house away from the Machens. Both in their late 60's, they did not want to go into debt with an SBA loan to raise their house or business. And they did not think FEMA offered them enough to take a buy out.

RUSSELL ELDER: They don't offer you enough money for your property. Just playing games. They want to steal it from you. And I'm not going to let 'em steal mine. I'll let the river wash it way before they steal it.

JERRY KING: In terms of the "not enough money" objection, that's certainly true. We were restricted, and I think reasonably so, by the federal agencies to paying assessed value or market value of these homes. And in many cases, people just didn't feel that was adequate.

MS. BRACKETT: For people who did stay on the floodplain, tougher federal flood insurance requirements also mean that less will be paid out in disaster relief. FEMA regional director John Miller.

JOHN MILLER, Regional Director, FEMA: After the '93 floods, we required those folks who receive federal assistance to have flood insurance for three years. If they could not afford it, we made sure that they were given the first year's premium. We found in our initial assessment that 78 percent of those folks that we, that we looked at had insurance.

MS. BRACKETT: And how different is that? How many people had insurance in '93 roughly?

JOHN MILLER: We think somewhere around 25 or 30 percent.

MS. BRACKETT: So that's a big change?

JOHN MILLER: Yes.

MS. BRACKETT: Now, if they did not keep their flood insurance current over the past -- since 1993 -- and they file a claim for benefits, what will happen?

JOHN MILLER: The only thing that they will receive, if a federal disaster is declared, is temporary housing. They will not receive any kind of federal assistance for any kind of fix up or any destruction that has happened to them.

MS. BRACKETT: There are changes in crop insurance as well. In 1993, Gary Machens had no crop insurance and lost most of his livelihood. Now, catastrophic crop insurance is required for any farmer who participates in farm price support programs.

GARY MACHENS: This will help us recover our input costs. You know, we had all our chemicals, our insecticide, our fertilizer, our seed, all those, all those were down. All those costs are out, and there's no recovering them. The insurance will help you recover all those costs, so you're basically running in place this year.

MS. BRACKETT: An overall change in the national attitude toward disaster relief has been brought about by the struggle in Congress to balance the federal budget. Scott Faber lobbied for a change in flood relief policy for the public interest group American Rivers.

SCOTT FABER, American Rivers: For the first time, really beginning with the California flooding last year, Congress has decided that we are no longer going to pass the buck for these disaster relief costs to future generations. In the past, what we would do is we'd take the money right out of the mint and just simply add to the cost of the deficit. What's begun to happen now is Congress has said, we're going to pay as we go, we are going to cut other programs, whether they be military spending or welfare or food for kids or what have you, to help pay for the costs of these kinds of disasters.

MS. BRACKETT: So there have been significant changes in the way disaster relief programs are handled. Between the buyout program and tougher flood insurance requirements, the taxpayer will shell out far fewer dollars this time. But there have been fewer significant changes in the way the rivers and the floodplains are managed in order to try and prevent future disasters. In this flood in St. Charles County, once again every levee was overtopped. In at least seven spots, levees broke. The same thing happened all along the Mississippi and the Missouri in 1993. After that flood, a task force headed by former Army Corps of Engineers General Gerald Galloway issued a report that said not all levees should be repaired.

BRIG. GEN. GERALD GALLOWAY, Director, Floodplain Task Force: The federal government should not be in a position of subsidizing the reconstruction of levees where those levees are in a location that we from a technical standpoint know just aren't going to work.

COL. TOM SUERMAN, Army Corps of Engineers: Galloway has not had an impact on our policies directly right now.

MS. BRACKETT: Col. Tom Suerman commands the Army Corps for the St. Louis District. He says the Corps has made no major changes in levee and floodplain management policies following the 1993 flood.

COL. TOM SUERMAN: We're following the same policies right now. What we are trying to do is shorten our decision cycle so that we can react more quickly and to minimize any damage once it's identified.

MS. BRACKETT: And as far as the Corps actually deciding not to repair any levees, did that ever happen?

COL. TOM SUERMAN: No, we did not decide to not repair all the levees. We have proceeded with the final repairs, and we've been moving out very well with those.

MS. BRACKETT: But no levees were made higher either. And that is a major source of frustration and anger for those in St. Charles County. Gary Machens says even a five foot rise would keep his fields dry most years.

GARY MACHENS: We don't need no big industrial levee, no levee like St. Louis or Alton, Illinois, but we need a levee we can live with, something like 50-year level protection. We're not asking to have a levee higher than our neighbors. We just want something, you know. If we could have something four or five feet within the top of there is where the ag property would still flood before the big businesses did. This is just crazy.

MS. BRACKETT: St. Charles County executive Joe Ortwerth says the county doesn't want money from the government to raise its levees, just permission, permission that has been consistently denied.

JOE ORTWERTH, St. Charles County Executive: And that we find very hard to swallow, because it means that St. Charles County does have to swallow everybody else's floodwater. The levees have been increased downstream from us. The flood walls have been established at such a great height in the city of St. Louis, creating a major constriction. That bottles up the river in the St. Charles Peninsula right where the three rivers and their watersheds are all slamming together. We end up as a punching bag for everybody else's floodwater.

JOHN MILLER: St. Charles County cannot raise their levee because if they raise it, it will impact other communities farther downstream.

MS. BRACKETT: And FEMA's John Miller says St. Charles County made a bad decision over 50 years ago.

JOHN MILLER: St. Charles County had a chance, my sources tell me, my staff tells me, back in 1939, to kick in some money and do what they needed to do. They did not do that. The other communities downstream did, in fact, put their levees up, and now when they want to come back in and do it, it's going to impact them and they, we will not let them do it.

MS. BRACKETT: But that was 1939.

JOHN MILLER: That's correct.

MS. BRACKETT: So the decision made then is impacting them right now?

JOHN MILLER: That's correct.

MS. BRACKETT: Any new flood control structures would be much harder to build under the Clinton administration's proposed Army Corps of Engineers budget Scott Faber says.

SCOTT FABER: The benefit/cost ratio for a project which is now currently one to one, benefits must be equal to cost, must now be two to one, benefits must be twice as great as costs. Practically, that means that most flood control projects in this country that are currently being built would not -- would not be built in the future.

MS. BRACKETT: Whether or not these changes become law, Faber says it is clear that the federal government will be paying less for flood control in the future. That means that people like the Machens, stuck with low levees in one of the most flood prone areas in the country, will be battling a lot more floodwater, and they, not the American taxpayer, will be paying the price of living on the floodplain.

MR. LEHRER: Still to come on the NewsHour tonight, what does balancing the budget really mean, and some special art in Russia. FOCUS - THE LONG VIEW

MR. LEHRER: Now some long view musings on this holiday about what is happening in Washington, most particularly with the drive to balance the federal budget. The Senate joined the House last week in enacting legislation to do so by the year 2002. What does it all mean for now and possibly for history was what was on the table before five people who consider such questions for a living. I talked to them on Friday.

MR. LEHRER: With us again are presidential historians Michael Beschloss and Doris Kearns Goodwin, and author and journalist Haynes Johnson. They are joined by David Frum, author of Dead Right, a recent book on the conservative movement in America, and David Gergen, former Clinton and Reagan advisor, magazine editor, and NewsHour analyst. Doris, an economist said on this program the other night the budget debate is not really about money, it's about the role of government in our lives and it is one of historic proportions. Is he right?

MS. GOODWIN: I think he's absolutely right. I mean, it seems to me the last time we had a debate of this dimension which really involves what part of our problems are going to be solved at the federal level, at the state level, or by private means was when the New Deal was initiated. There we had a set of economic problems that could no longer be handled as Hoover had hoped by our private charity or by the states, so we have to create the federal solution to those problems. And then on top of that, came the war, and on top of that, the Cold War, so the federal government has to become the solution in many ways to many real problems in the society. And what we see now is a whole questioning of that that goes much deeper than the budget debate, itself. Those problems are still out there, so I worry about this solution we're moving toward, but there's no question that the dimension of the debate, which we see even in the Supreme Court right now, as to the role of the federal government in our lives, rivals 1932.

MR. LEHRER: Do you agree with that, David Frum, it rivals 1932 in terms of significance?

DAVID FRUM, Author: [Toronto] Well, not exactly. Look, obviously, something important is happening here, which is we are bumping up against the limits of Americans' ability to tolerate government in their lives. We're reaching the edge of the known universe. In that sense, money is certainly a part of it, because the sheer backbreaking cost of all of this that is one of the things that has brought about so much impatience, and it's also the cost that has made it impossible to continue escalating these costs at the rate they're going. As to 1932, I wonder. I think one of the things that was very striking about 1932 was the enormous pain that President Roosevelt then took to assure Americans that nothing revolutionary was happening, which is a sign that something he, in fact, had something pretty big up his sleeve, and I worry that a lot of the revolutionary rhetoric we're hearing now is something of a substitute for substantial action, and that the very mildness of what the Republicans are, in fact, aiming at, which is to halt the growth of many of the most extravagant programs, reform these programs in a way so they're a little bit less unfeasible, but then more or less accept the status quo.

MR. LEHRER: So it's not revolutionary?

MR. FRUM: I worry that is being disguised by some of the revolutionary rhetoric.

MR. LEHRER: But it isn't really revolutionary. It's only the talk that's revolutionary, is that what you're saying?

MR. FRUM: I fear so.

MR. LEHRER: What do you think, Michael?

MICHAEL BESCHLOSS, Presidential Historian: I think it is revolutionary. I think it's a very big change in direction and philosophy, and really goes back all the way to the founding period, back to the 18th century. When our country was being invented, there were basically two schools of thought. One was that when you've got a country that is likely to grow, you have to have a very powerful government to allocate the resources to get the greatest good for the greatest number. The other school of thought was you can't do that, you have to leave it up to individuals to compete with one another, leave everything as much possible to the private sector. School No. 2, the one oriented to the private sector really dominated in this country until, as others have said, the early 1930's. Now for the first time since the 1930's, you have a feeling that if something is going to be done by government, it has to be very well explained why that is not going to be done by the private sector. That's a very good change from what dominated in this country from the 30's to the 70's.

MR. LEHRER: Because up till now then, you mean, when there was a problem, whatever it is, in the crime area, in any kind of social area, there was an immediate suggestion that the solution could be found by the government.

MR. BESCHLOSS: The assumption even by most Republicans was that in the complicated industrial age, 30's through the 1970's, that this country was too diverse, the problems much too immense to leave it to the private sector, or perhaps states and localities now that's all changed.

MR. LEHRER: And David Gergen, that's where the politics has been too, is it not, I mean, an escalation of what I can do for you to solve your problem, elect me and give me a whirl at it, right?

DAVID GERGEN: Absolutely. I come down on the side of saying that if the Republicans succeed in reducing the size and scope of government, it will be historic. You will remember, Jim, that the historian, Arthur Schlesinger, Senior, first elaborated a theory and then his son worked on it as well, that American history has moved through cycles from a series of governmental activism to quietism, but they then specifically rejected the notion of history moving in this pendulum, or moving over toward activism and then moving back toward quietism in this way. Instead, what they said was American history has been a spiral, with periods of activism. More government control has come, and then the spiral levels off. Then there's a new period of activism, and you go up again, and all through our history that spiral's been rising. This will be the first time that we've started going back down that spiral. We have never done that before. Always before during the periods of quietism it's leveled off. It's been an acceptance of what's there. These Republicans are revolutionary in a sense of saying we want to dismantle what's there.

MR. LEHRER: But, David Frum says all it is so far -- I mean, that it's a very small kind of incremental change they're talking about.

MR. GERGEN: I prefaced by saying if they succeed.

MR. LEHRER: If they succeed.

MR. GERGEN: But I think their plans, I think, on paper at this moment are extremely bold. Whether they follow through with them I think we have to wait and see, but I think they're winning the argument on that.

MR. LEHRER: But, Haynes, how would you use the word "revolutionary," if at all, to describe what's going on?

HAYNES JOHNSON, Journalist/Author: I wouldn't use it, Jim. I think this is historic, and I agree with what you just said, David, I agree with what you said, and I think what Doris said. This is a big changing part of American history right now. We're living through it, and if they succeed, and I think the intent is clear, it is to change fundamentally the role of the federal government in the life of all of us in this country. That's a different thing, more than even in 60 years, I think, because the --

MR. LEHRER: Change it to what? Change it to what?

MR. JOHNSON: To expand it, laissez-faire, open the decks, privatize, we don't need the regulation, we don't need the standards, we don't need a government hand at the top across the board. We can entrepreneurially free up the society. We don't need the magic of the marketplace will work. David, you were in the Reagan White House at that time. This is much more. This is much more serious. Reagan never once sent a budget up to the Congress that was in balance. This is a real attempt. Sen. Domenici said the other day we're doing something now that's not been done before, and he said, we're say, okay, if you want these programs, you have to raise the taxes and pay for them, and I think that's right.

MR. GERGEN: Reagan used to cite Roosevelt. These folks want to undo Roosevelt.

MR. LEHRER: Is that right, Doris, do you agree, they want to undo Roosevelt?

MS. GOODWIN: Well, I think they want to, but I doubt that they'll be able to undo certain parts of the Roosevelt revolution. Labor unions will still remain legitimate, as they became under the Wagner Act. The Social Security program is still going to be in place. Certain kinds of movements in civil rights that took place during his era will be in place, as they will be from the Great Society, so there are certain fundamental things that hopefully they will not even dare to change, but I think this whole economic relationship between private, state, and local, and federal government is absolutely up for grabs. My real worry still is those problems are still out there -- kids that are dependent children, inner-city blight, devastation of opportunities for minorities -- and the federal government may have messed up in terms of how it tried to deal with them, but somebody better try to deal with them, and they just can't allow -- assume that they're going to go away.

MR. LEHRER: David Frum, what about that? If this is going to be replaced, in other words, if the strong role of the federal government is going to be replaced as a result of this debate, what is it going to be replaced by?

MR. FRUM: Well, I wonder if there some pages missing from my copy of the authorization report. As I read it, the federal government still intends to guarantee the health care of every American over age 65. Those costs may not be allowed to rise quite as radically as they've risen in the past, but it's still going to be there. They still intend to pay the pensions of every American, whether they need it or not. Welfare is still going to exist. It seems to me that to suggest --

MR. LEHRER: Let me stop you there. You don't think that it's a major change if they -- welfare is still going to exist, however, they're going to send it from the federal government to the states, which they just voted on in the Senate Finance Committee.

MR. FRUM: The money is still going to turn over -- welfare is a program that is administered by the states subject to certain federal rules. The states are now going to be subject to different federal rules and are going to get a little less money. But the idea to compare this to some kind of -- I wish it were -- I wish it were a dramatic breakthrough in the understanding of what the federal government is responsible for.

MR. LEHRER: What is it then? Describe it. Use your own words to describe what's happening.

MR. FRUM: What I think has happened here is that after a period of extraordinary irresponsibility in Washington, beginning in let's say 1965. I think we have just bumped up against the limit of people's tolerance, tolerance in terms of taxes, tolerance in terms of regulation, tolerance by the way in particular in terms of racial favoritism. I don't think we should underestimate how much that is driving a lot of people's resentment of what Washington does. Do we see any sign of a rollback, any sign of government saying to people you're on your own, that people who can afford it should pay for their own pensions over 65, no, we haven't seen anything like that. That I think would be a revolution. That's what we mean when we talk about a revolution, and that, I think, not only are we not seeing it but the Republicans are going to great length, unfortunately, to specifically disavow any intention of doing just that.

MR. LEHRER: Michael.

MR. BESCHLOSS: I think what we're avoiding though is the importance of moving away from deficit spending and moving toward the idea now shared by both parties that America should always have a balanced budget. That is very recent. For most of the period after World War II, Republicans were willing to tolerate very unbalanced budgets. In the early 1970's, Richard Nixon said I'm a Keynesian, I believe that you should have deficit spending to help the country particularly during times of recession to stimulate the economy. It's only in the last number of years that you've had members of both parties say that's not a good thing anymore, we should always try to have a budget that is not in any way unbalanced. That very much changes the role of government and it's going to have to do that in the future.

MR. LEHRER: David Gergen, David Frum used the word "tolerance," more of a personal thing, that people have grown intolerant of their government. Is it -- is your reading of it that they expected the government to solve these, all these problems, crime problems, welfare problems, and they didn't do a good job of it, and that's what they're reacting against, or is it deeper than that?

MR. GERGEN: I think he's on the right track, and I agree with much of his last analysis. It does seem to me what we have seen in the last few years is that people in this country are rejecting more government. It was most vividly seen I think in the debate over health care last year. What we don't know yet politically is whether people are willing to accept less government. We think -- I think we've seen the reaction to bigger government, but whether people, as this debate goes forward, whether people will be willing to accept the implications of what the Republicans and the conservatives would like to do, I don't think we know the full answer to that yet.

MR. LEHRER: What I'm really asking in a kind of a gross way is, let's say there was no crime in this country and as a result of big government, do you think people would be that upset about big government? That's what I'm suggesting.

MR. GERGEN: Oh, I --

MR. LEHRER: Which is the thing, big government, or the lack of big government's ability to solve their problem?

MR. GERGEN: I personally believe that what's really going on is that the country, that people are caught in this new economy in such ways they're looking for scapegoats. And government has become one of the many scapegoats we're lashing out against, we lashed out against immigrants, we're lashing out against welfare moms, and we're lashing out against government, because somehow people feel trapped. So many of the people in this country feel trapped in their lives. Haynes has been out around the countryside.

MR. LEHRER: Do you feel trapped, Haynes?

MR. JOHNSON: Absolutely. And I think David's right. Government is a shibboleth for anything that's wrong. It's there. It's big. It's alien. It's distant.It doesn't understand how our lives are like. We've talked about this before. You go and sit in the inner cities, you go and sit in people's home, and they express this rage, this fury. At the same time, they have benefited enormously from government. The last time we sat around this table was V-E Day. That's the role of the federal government in all possible ways, economically, socially, politically, after the war, ending segregation, leading on to changes and so forth. And the people who have benefited often most from it are those who are now most alien from it. And I think what's happening is this deep hunger to make changes to work that can't work. I mean, government succeeded, and now they're looking for something that -- you're right -- it's a specter -- it's something in the air that we don't like, and it frightens us. At the same time, I am not at all sure that they're going to buy the consequences. I agree -- disagree with Mr. Frum that -- that there isn't a change back to the states. The devolution process, if it worked, of taking block grants and putting it back to the states, like Medicaid and things like that, is back where I came in as a kid reporter covering civil rights in the South. That's states' rights, and it doesn't always work.

MR. LEHRER: David Frum.

MR. FRUM: One of the things I find fascinating with that last comment is if we were to have had this conversation a hundred years ago, if you were to ask people, do you think the President or the Senators understand you and your problems, they would have blinked at you. That was an incredible question. I mean, it wasn't the President's job to look after you. That was your responsibility. His job was to make sure that the Constitution and the laws were enforced. It may be true that one of the reasons for so much impatience is because Americans have had such preposterous expectations of what government could do. Government was supposed to banish racism. Government was supposed to banish crime. Government was supposed to banish poverty. Well, of course, government failed to do all of those things. Of course, it failed, but the people -- people made a substantial political livelihood for many years out of promising not to fail, and when the inevitable failure came, that no wonder that people say, this institution, it promises too much. I mean, the private market simply promises, you know, better cola taste. That's a promise you can fulfill.

MR. LEHRER: Doris.

MS. GOODWIN: Well, let's remember that the government did fulfill many of the promises, and that's one of the reasons why during Roosevelt's time and afterwards there was a great support for the federal government. I mean, we did take us through that Depression, even though it didn't end the Depression. It helped people to get jobs. It helped people to live during that time. It got us through World War II. It helped to stimulate the civil rights revolution, to create the Voting Rights Act. So I think one of the things that's happening, we cannot underestimate there's an anxiety in the people out there. The Republicans have so far won the ideological battle. They are saying the reason why you're anxious, the reason why the economy is not working so well is government, and the Democrats have not taken up the cudgel of really figuring out a rationale, where do we still need government, where can it be betted on at the state level, where can we allow the private initiative to take place? That argument hasn't really been met. All we have is the big enemy out there, big government. And I don't think that it's people are not able to shape their feelings, depending on who wins that argument. If the Democrats could get out there, I'm not so sure they couldn't start persuading people that government's done some great things, and there are still important things for it to do. They're just silent. They're just standing there.

MR. LEHRER: That's what I wanted to ask you now, beginning with you, Michael. Does this have a smell of permanence to it, or something that's just right now? I mean, there's this frustration that's hit right now. As all of you all agreed, the Republicans have capitalized on it very skillfully, and could it pass in another two years?

MR. BESCHLOSS: I think it could pass, but it's going to take a long time, more than two years. I think basically two situations in which that could happen -- one is that these cuts hit people in a very brutal way or perhaps damage the economy to the extent that there is suddenly a great burst of feeling that perhaps we did too much, perhaps government should be given more power again and fix these problems, not only economically and socially. The more arresting possibility is that over a number of years the budget gets balanced, there's a huge boom in this country, great prosperity, those are the conditions in which liberalism really flourishes. When people are feeling, as I agree with everyone who's spoken before, when people are feeling threatened and pinched, they don't feel very tolerant, they don't feel very eager to have government help people's lives in a very direct way. If you have a period of prosperity, that's the period in which I think there'd be a renaissance for liberalism, and ironically, a renaissance for the Democratic Party.

MR. LEHRER: How do you see the state of this, in terms of here today, or gone tomorrow, or here forever, or for a while, or is it possible to project? I don't care if it is or not -- I'm going to ask you.

MR. GERGEN: That's why you have to have the show every night. [laughing]

MR. LEHRER: You're right. You're right. [laughing]

MR. GERGEN: My sense is that the era of bigger and bigger government is over. I think big government has been discredited, and it will not come back again anytime soon, absent a depression, a great war, or some such, you know, major event in our lives. But what is left unresolved is: where do we go from here? Do we shrink the government back? Does the government have some continuing role as an enabler or as a catalyst? Will the government be setting standards and have others carry them out? It seems to me that is where the debate is going to center now. And I think the Republicans do have the momentum, but whether they can hold it or not I think still remains unclear.

MR. LEHRER: David Frum, you said at the very beginning that you did not think this was a revolution. Take us through what would go from here -- take us through a revolutionary scenario from this modest beginning on down the line.

MR. FRUM: I think the real revolutionary scenario, the real undoing of the bad things, from the 30's and from the 60's, would do some of the following things. It would establish, again, real equality under the law, regardless of ethnicity. It would mean an end to the policies of racial favoritism that have sprung up since the 60's. It would mean that most people most of the time would be considered to be responsible for themselves. We would see the end of non-means-tested government programs. The government would be there to protect the poor or protect people from unpredictable catastrophes. It would not be in the business of providing a pension to absolutely every individual. It would not be in the business of providing medical care for everybody. Those are the kinds of things that, that would be substantial. So would, for example -- I've often thought that a good test of how radical a Republican is, is the day that the Republicans announce that the federal government has enough money. I mean, you know, you, the American people, you've entrusted us with $1 1/2 trillion this year, that will be fine for next year, that will be fine for the year after that, we are going to reach something like an absolute cap in dollar terms on government spending. That, to my mind, would mark a substantial change. But to say we're going to keep more or less the same programs and try to wind them down over a period of seven years, with most of that happening, by the way, in the last two of those seven years, listen, I applaud it, I think it's a great start, I think it is a solid reform, I think what was happening before was unsustainable, but I think that the Republicans, the truth is a little bit more modest than some of the Republican rhetoric would have it.

MR. LEHRER: Where do you come down, David Frum, on this question of whether or not this is a real change, whatever, however modest you think it is, or a temporary one that is still frail and could go -- could -- the pendulum could go back very quickly?

MR. FRUM: I think it's going to be hard for the partisan pendulum to go back. I think that what we have seen is a demonstration of how weak the Democratic Party is, a congressional party was, how cleverly and skillfully it managed to hang on in the face of adverse circumstances, but they are now so committed to so many positions where either -- if those positions doom them, on the other hand, moving away from those positions also gets them into trouble with many of their traditional supporters. I think you'll see a Republican majority for quite some time, certainly in the House of Representatives, probably in the Senate too, and I think what you will see is no more major government initiatives and a great deal of skepticism about those that are already in place. And I hope there will be -- as these entitlement programs prove to be a worse and worse deal, people under a certain age -- I hope there will be the beginnings of some real radical questioning of whether or not they should exist at all in anything like their present form.

MR. LEHRER: Doris, what do you see when you look ahead?

MS. GOODWIN: Well, I think there's a voice out there for the Democrats to have if they start thinking in a certain sense. For example, I think there's a real class warfare argument that can be made that's not rhetorical. The Republicans are absolutely unwilling, so it seems to cut back on corporate welfare. They're not talking about getting rid of the benefits for oil, tax, minerals, kinds of jobs. They're not talking about really being willing to raise taxes for something that's important. They're not really talking about a lot of things that the Democrats could zero in on. Our maldistribution of income right now in this country is greater than any other time. The rich are richer, the poor are poorer, and these government programs were transfer payments in a way to help the poorer people have a little bit of the benefits of life -- minority scholarships, access to college, whatever they did, they helped to bring that balance about. If these programs all get cut, the gap between rich and poor is going to be much greater, and the Democrats have traditionally been on the side of the middle class, and the poor, if they find their voice, I'm not so sure this is as permanent as we're all saying, but they've got to start talking.

MR. LEHRER: Yes, David.

MR. GERGEN: Well --

MR. JOHNSON: I don't think it's permanent either, and I would like to hear what you say about it. I think there's a great opportunity to make the case that government at its best worked and the things that didn't work we ought to get rid of, we ought to make it better. We gave the GI bill that educated America, gave low cost loans. It ended segregation. It fought for civil rights in a way that was positive. It didn't mean it was all right, and it didn't mean it didn't go too far. That's the case to be made. It's not being made now. I think the debate that's taking place is tremendous. It's important. What we're in right here. I think Doris makes the case better than any Democrat's making it, and Mr. Frum is making the case ideologically and philosophically better than, than what I hear on the Hill.

MR. GERGEN: I'd just like to say, Jim, it seems to me that Doris Kearns is right about the Democrats haven't made the case, and that they can make a case about the distribution of income and the way to get to a balanced budget, but for the Democrats to win that argument, they first have to realize that the Republicans have already won the argument that the budget must be brought into balance.

MR. LEHRER: So it has to be in that context, right?

MR. GERGEN: The Democrats have to come on board and be in favor of a balanced budget and serious about it, and then they can say, okay, now, where we disagree is how we get there, then it seems to me her argument is much more forceful.

MR. LEHRER: I see five nodding heads, and on that, I'm going to leave it. Doris, gentlemen, thank you all very much. ESSAY - ART HELD HOSTAGE

MR. LEHRER: Finally tonight, essayist Amei Wallach, art critic for the newspaper "Newsday" has some thoughts about a new art exhibit in Russia.

AMEI WALLACH, New York Newsday: [St. Petersburg, Russia] On June 22, 1941, three million German troops invaded the Soviet Union, supported by 2700 airplanes. Stalin had been warned about the invasion again and again by American espionage, German resistance groups, and Winston Churchill, himself, but secure in the non-aggression pact he signed with Hitler, Stalin hadn't believed anybody. The Soviet Union was unprepared, and everyone suffered horribly for it. To Hitler, the Slavic people were like Jews, an inferior race to be killed and their culture destroyed. Leningrad and Moscow were to be leveled. "This" -- German colonel general recorded in his diary -- "would relieve us of the necessity of having to feed the population through the winter." The city survived, but only after the 900-day siege of Leningrad during perhaps which a million people were killed by gunfire, starvation, or freezing to death. More than half a century later, succeeding generations have neither forgotten nor forgiven. Like many of the wounds still festering from unfinished history, this one is erupting again, only this time not in the form of hostage nations but in the form of hostage art, in the form of paintings by El Greco, Tintoretto, Goya, and Manet, that the Soviets spirited out of Germany at the end of the war, then kept hidden all these years. For a half a century, these works were believed to be lost from German collections and those of Hungarian Jews. Now, they've abruptly surfaced at the Pushkin Museum in Moscow in the exhibit "Twice Saved." Thousands of works of gold from a precursor to Homer's Troy once resided in a Berlin museum. Now they're scheduled to go on view in Moscow. An even more coherent and dazzling display opened recently at the State Hermitage Museum in St. Petersburg, and all through the summer, 74 Impressionist and post-Impressionist works are on view at the Hermitage in the exhibition "Hidden Treasurers Revealed." These are only the tiniest fraction of the hundreds of thousands of paintings, sculptures, drawings, prints, rare books, ancient gold, and even the stained glass windows from Frankfurt Cathedral, which Red Army troops transported out of Germany at the end of World War II. Controversy cannot help but swarm around these paintings. Many Russians now argue that they were right to take this art out of Germany, because it had been the policy of the German government to steal the best from the lands it occupied. However, it became allied policy, after some uncomfortable soul searching on the part of the U.S. government, to collect that German bootie and return it to countries it came from, except for the Soviets. They believed that they deserved compensation for the destruction Germany had leveled on their country. And so some of the great works of the world traveled East. Some were later returned to East Germany, and everything else still in the Soviet Union went into hiding. Secrets like that became impossible to keep once Communism fell in 1991. Since then, the art has been surfacing. And the descendants of the Germans who'd consigned their art to museum bunkers for safekeeping during the war have been making pilgrimages to Moscow and Leningrad to identify the art. By international law, they and their lawyers argue, they ought to be getting their belongings back. Not so, say many Russians, and in particular, many members of Russian parliament. The art should stay in Russia as reparations for what they lost and how terribly they suffered during the war. It's impossible to totally separate the 74 pictures at the Hermitage from their heritage of war and blood, but it's important to try, to see them not just as controversy but as art. It's not just a great attic of rancor that's being aired here. Because they were in deep hibernation so long we have a rare chance to see paintings by perennial favorites with a fresh eye. The Gauguins weren't known to anyone, even by remembered reputation. Degas' "Interior With Two Figures," from 1869 is a little known example of his sardonic view of dysfunctional human relations. The dark shape of a woman stands, arms folded, facing us, while a man who his back to her impatiently taps his foot and looks out the window. In is 1876 "Place De La Concorde," the masterpiece of the show, Degas took the domestic drama outdoors and gave it emptiness and distance. Everything in this picture happens at the edges. The center is a wasteland of alienation. No one but a stranger is looking at anyone else, not even the dog. Now that we can come face to face with the spacious arridness of this painting, Degas will never look the same again. The Van Goghs almost form an exhibit within the exhibit. "Landscape With House and Plowman" from October of 1889 is a showstopper, despite its tiny 13 x 16 inches. Scholars who knew it only from a black and white reproduction dismissed it as minor. It's not. Now, it takes its place in art history, and Van Gogh will never be quite the same to us again. So who do these paintings belong to now? They belong to history. They belong to the light of day. I'm Amei Wallach. RECAP

MR. LEHRER: Again, the major story of this holiday was the worsening crisis in Bosnia. The United States moved 2,000 Marines aboard ship to have spotted the Adriatic Sea off the Bosnian coast. There was no word on their possible use. The British also beefed up their peacekeeping force on the ground in Bosnia. Serb forces continue to hold 367 UN peacekeepers hostage in retaliation for NATO air strikes last week. We'll have full coverage and analysis of the situation in Bosnia tomorrow night. Have a nice holiday evening. I'm JIm Lehrer. Thank you and good night.