The MacNeil/Lehrer NewsHour

MS. FARNSWORTH: Good evening. I'm Elizabeth Farnsworth in Washington.

MR. MAC NEIL: And I'm Robert MacNeil in New York. After tonight's News Summary, we look at how the Republican drive for a balanced budget amendment has slowed down the Senate. Jeffrey Kaye reports on the arguments about selling American arms to other nations, and we close with another in our series of conversations about the future of the CIA, tonight with former CIA analyst Melvin Goodman. NEWS SUMMARY

MS. FARNSWORTH: The House of Representatives today approved an outline for sweeping changes in U.S. foreign and defense policy. The bill, known as the National Security Revitalization Act, was promised in the Republican Contract With America. It passed in a 241 to 181 vote. One of the key provisions is a limitation on U.S. involvement in United Nations peacekeeping missions. It was also one of the most controversial aspects of the bill.

REP. NEWT GINGRICH, Speaker of the House: We're trying to be responsible in sending a very clear, very strong signal to this administration, do not put U.S. troops under U.N. commanders, except in extraordinary circumstances. Do not expect us to accept that. Do not expect us to be favorable to it. We're also saying to them you had better tell the U.N. to get its accounting in order, and you had better plan on counting U.S. defense spending when it is done in support of the U.N. as part of our U.N. contribution. We're trying to send a pretty clear policy signal that they need to re-think this sort of feckless multilateralism where they have various and sundry confused bureaucracies who aren't doing very good jobs, spending a lot of money, and potentially risking American lives.

REP. ALBERT WYNN, [D] Maryland: We have very legitimate and vital national interests which are protected by U.N. peacekeeping. What are our interests? We have an interest in the global marketplace, that markets are allowed to thrive and not disrupted by localized aggression and by petty dictators. We have an interest in oil. Our recent efforts in Desert Storm magnify the fact that we need to work collectively, and we need to have the resources of other countries join with ours to fight to help protect our specific interests. We have a very important interest, Mr. Chairman, in fighting terrorism internationally. It is better, I submit, to fight terrorism on other shores in a preemptive manner, rather than have it come to this country.

MS. FARNSWORTH: The bill originally called for deployment of a Star Wars type missile defense system, but last night 24 Republicans joined the Democrats in rejecting that section. The bill has an uncertain future. There is no similar legislation before the Senate, and President Clinton has said he opposes the bill in its current form. Robin.

MR. MAC NEIL: Attorney General Janet Reno announced today the Justice Department has begun a preliminary investigation into the personal finances of Commerce Secretary Ron Brown. The Department has 90 days to decide whether a special prosecutor should be appointed to conduct a full criminal investigation. The attorney general also announced that the Justice Department will appeal the judge's ruling that rejected an antitrust settlement with the Microsoft Corporation. The giant software firm is accused of using anti-competitive practices. Microsoft said it would join in the appeal. In economic news, the government reported housing starts fell 9.8 percent last month, the biggest drop in a year. Construction was off in all areas of the country.

MS. FARNSWORTH: A pre-dawn tornado in Northern Alabama killed at least three people and injured more than one hundred. The twister touched down about 30 miles south of Huntsville. Trailers and farm buildings were toppled. Trees and power lines were ripped down. Strong winds associated with the storm system destroyed up to 200 homes in five Alabama counties. There was flooding in parts of Mississippi and Georgia. Four army rangers died yesterday during training exercises in the Florida panhandle. Four others were rescued. The rangers developed hypothermia while patrolling through chest-deep swamp waters at Eglin Air Force Base. The survivors are listed in good or stable condition. Officials at ranger training headquarters are investigating the incident.

MR. MAC NEIL: Russian President Boris Yeltsin sharply criticized the military today for its action in Chechnya. It came during his annual State of the Nation address. He blamed leaders for failures, setbacks, and mistakes in the war and promised a reorganization, but he also defended his decision to being the offensive in the breakaway republic. White House spokesman Mike McCurry said Yeltsin looked strong and in control, following recent reports to the contrary. In Bosnia, two aid convoys delivered food and supplies to people in the Bihac region today. The relief came as the World Food Organization announced that up to 40,000 people in Northwest Bosnia are at risk of imminent starvation. The Red Cross was also able to evacuate several children during the convoy's return trip.

MS. FARNSWORTH: Today is the first day of spring training in professional baseball. Only a few minor leaguers and replacement players took the field at the New York Yankees' camp in Ft. Lauderdale, Florida. The Yanks were the only team to hold an official workout today. The baseball strike has lasted more than six months. That ends our summary of the day's top stories. Ahead on the NewsHour, debating the balanced budget amendment, selling arms overseas, and talking about the CIA. FOCUS - BALANCING ACT

MS. FARNSWORTH: First tonight, moving toward the political end game on the balanced budget amendment. The House of Representatives passed its version -- its version at the end of last month. Now, the fate of the amendment rests in the Senate, and more specifically, with just a handful of Senators. Kwame Holman begins our report.

MR. HOLMAN: When the House of Representatives took up the balanced budget amendment last month, members managed to complete debate on the issue and pass it within two days.

REP. NEWT GINGRICH, Speaker of the House: Two thirds of those present having voted in the affirmative, the joint resolution is passed without objection. Any motion to reconsider is laid on the table.

MR. HOLMAN: In the Senate, however, deliberations can continue until at least 60 Senators vote to bring the to an end.

SEN. TRENT LOTT, [R] Mississippi: We are now in the 17th day on this constitutional amendment for a balanced budget.

MR. HOLMAN: And this morning, when Senate Republicans tried to convince enough Democrats to join them to end three weeks of debate on the balanced budget issue, the effort failed.

SPOKESMAN: On this vote, the yeas are 57, the nays are 42. Three fifth of the Senators duly chosen and sworn, not having voted in the affirmative, the motion is not agreed to.

SEN. ORRIN HATCH, [R] Utah: And we will have more days of debate, and that's only fair. This is a very, very important amendment.

MR. HOLMAN: Utah's Orrin Hatch leads the 52 Republicans who support the balanced budget amendment. Only Oregon's Mark Hatfield is opposed. But because 67 votes, 2/3 of the Senate, are needed to approve an amendment to the Constitution, the Republicans again need the help of Democrats.

SEN. ORRIN HATCH: Fifteen out of forty-seven, that's all we need. Gee, there ought to be fifteen Democrats in the Senate out of forty-seven who will help us. I know of thirteen, and I think I know of fourteen. Who's going to be that fifteenth vote?

MR. HOLMAN: Sen. Paul Simon of Illinois is the leading Democrat in favor of the balanced budget amendment. But without the support of at least 14 of his party colleagues, the amendment will fail, and at last count, he's still at least one vote short.

NORMAN ORNSTEIN, Congressional Analyst: The Senate is a tough not for the balanced budget proponents to crack.

MR. HOLMAN: Congressional Analyst Norman Ornstein.

NORMAN ORNSTEIN: Finding the final two or three to put them over the top is proving to be more difficult than they imagined. And unfortunately for them, in a debate of this sort, dragging on as it is for weeks, instead of building momentum where they can add pressure and get additional votes, the longer debate has raised more questions about the real impact of the constitutional amendment to balance the budget, and they found at least for a period in the middle of all of this that their support was starting to erode a little bit.

MR. HOLMAN: Most Senate Democrats side with Robert Byrd of West Virginia who has been the principal voice of opposition to the balanced budget amendment.

SEN. ROBERT BYRD, [D] West Virginia: Where are the proponents of this amendment? Why don't they -- why don't they interrogate James Madison?

MR. HOLMAN: But there is a group of about eight Democratic Senators whose opposition to the balanced budget amendment is considered soft. Any one of them could provide that additional vote needed to pass it, and so the Republican National Committee this week began running television ads in some of those Senators' home states in hopes of influencing their vote.

COMMERCIAL SPOKESMAN: [classroom setting] I've been asked to explain why your Senator may join Bill Clinton and vote against the balanced budget amendment.

PERSON IN COMMERCIAL: Vote against it?

COMMERCIAL SPOKESMAN: Yes. You see a fiscal budget authority in constant 1982 dollars remains --

WOMAN IN COMMERCIAL: I have to balance my family's budget.

COMMERCIAL SPOKESMAN: But --

MR. HOLMAN: The ads appear to be a last-ditch attempt to drum up support for an issue that doesn't seem to have captured the public's attention.

COMMERCIAL SPOKESMAN: Tired of excuses? Call Sen. Bingaman today. Tell him to vote yes on the balanced budget amendment.

NORMAN ORNSTEIN: The fact is when you run things, when you're actually in charge, a little bit of the edge comes off out there, and they had some difficulty, in fact, getting people mobilized to move forward. They wanted to put a kick in the pants to their conservative constituencies and say, if you don't get working on this, this amendment will go down, and it is the centerpiece of the Contract With America and the Republican plan for the future.

MR. HOLMAN: But New Mexico's Jeff Bingaman is so outraged by the Republicans' ad in his state that he fired off a letter of protest to Republican National Committee Chairman Haley Barbour, charging: "Your attempts to influence this important vote with hundreds of thousands of dollars in misleading paid political ads is the very essence of politics and partisanship and is contrary to principle and good public policy." Senate Minority Leader Tom Daschle, also a target of the Republicans' ads, also launched a complaint against the Republican National Committee.

SEN. THOMAS DASCHLE, [D] South Dakota: Well, I think it does a real disservice. To politicize the Constitution is not something that we've ever held to be very appropriate. And I don't think it's appropriate this time. The fact is that we can differ on issues, but to, but to generate a political campaign built around an amendment to the Constitution, in my view, it does a real disservice to the debate.

MR. HOLMAN: Just this morning, Daschle went to the Senate floor to announce he would oppose the balanced budget amendment, even though he, like Sen. Bingaman, voted for it last year.

SEN. THOMAS DASCHLE: While I believe we need an honest and fair balanced budget amendment, I know we need an honest and fair balanced budget even more. We can and we must get immediately to the real work of deficit reduction.

MR. HOLMAN: Senator, should you be criticized for voting for the balanced budget amendment in the past but not this time?

SEN. THOMAS DASCHLE: Not at all. The circumstances are vastly different. In the past, we had the confidence that we could protect Social Security. Now, we don't. In the past, we had a blueprint for how we were going to get from the deficit to a balanced federal budget. Now, we don't. So without those kinds of assurances, I just don't think we ought to quit working until we've got the very best work product, and this isn't it.

MR. HOLMAN: The balanced budget amendment also presents a potential political problem for Senate Majority Leader Robert Dole. A Senate vote that falls short of approving the amendment could be an embarrassment both for Dole as party leader and as soon-to-be- announced presidential candidate.

NORMAN ORNSTEIN: Bring this to a vote, and if it fails, if you can't get the 67 votes, think of the contrast. Newt Gingrich made it happen. Bob Dole couldn't make it happen. So Bob Dole does not want to bring this to a vote unless and until he's pretty confident he's got those votes.

MR. HOLMAN: Outside the capital today, proponents of the balanced budget amendment, Democrats and Republicans, held the rally in the rain to demonstrate their resolve to pass the amendment. An electronic tote board symbolizing the pace of the escalating national debt stood as their backdrop.

SEN. ROBERT SMITH, [R] New Hampshire: If we don't take action now to control this debt which continues to spiral, there won't be a clock big enough or a computer smart enough to calculate the damage that's going to be done to our country.

MR. HOLMAN: Inside the Capitol, however, debate on the balanced budget amendment continued, as it will through next week and possibly beyond.

MS. FARNSWORTH: Earlier today, I spoke about the balanced budget amendment with three Senators, one for, one against, and one on the fence. Trent Lott is a Republican from Mississippi and the majority whip in the Senate. Dale Bumpers is a Democrat from Arkansas, and Kent Conrad is a Democrat from North Dakota. Sen. Conrad, let's start with you. You're one of the crucial Democrats who is undecided, as I understand it, at this point. What would it take to make you vote for this amendment?

SEN. KENT CONRAD, [D] North Dakota: Well, first of all, I think we have to know what the final version of the amendment is. Let me just say my concerns are as follows: First of all, I am persuaded that it is imperative that we balance the budget of the United States over the next seven years because we've got a narrow window of opportunity here before the baby boomers start to retire and federal spending skyrockets, so it is critically important to the economic future of our country that we balance the budget. But it's critically important that any amendment to the Constitution be properly crafted. And there are a number of concerns I have with the amendment before us. No.1, as it stands, it assumes we will loot the Social Security trust fund of some $636 billion over the next seven years to balance the operating budget. I think that's wrong.

MS. FARNSWORTH: Just tell me quickly. How would that work? Explain that. It's complicated.

SEN. CONRAD: It works in this way. If you read the amendment, it says the budget that is being balanced is all receipts of the federal government and all outlays. Included in that are the Social Security surpluses that will be some $636 billion over the next seven years. So it assumes that we're going to be tapping the Social Security fund as one means of balancing this budget. I just think that is totally inappropriate. Second, it does not contain a capital budget. In the Republican party ad they said, let's do what the states do. Well, 42 of the states that have a balanced budget requirement also provide for a capital budget. Simply stated, that allows you to pay for a long-lived asset over a period of years. That's also what families do, by the way. We don't -- at least not many people I know -- pay for a house cash up front. They take out a mortgage. And finally, I have a serious concern about the involvement of courts. The last thing I want to see happen is having the U.S. Supreme Court writing the budget for the government of the United States. In addition to that, there's the larger question of: Is it appropriate to put this into the Constitution of the United States? We know we need to balance the budget over the next seven years. What is unclear is what would be the condition of the country 50 years from now or 100 years from now when it may well be the case that we need to take on some debt for some purpose that is not clear to us today.

MS. FARNSWORTH: Okay. Sen. Lott, let's just deal with one of those concerns for the moment -- Social Security. How would you argue, how do you argue to an undecided Senator about this issue? What do you say?

SEN. TRENT LOTT, [R] Mississippi: Well, first of all, this is the same language, the same amendment that the Senate voted on about a year ago. And 17 of the Democrats still in the Senate voted for it, including Sen. Daschle at that time. I think Sen. Conrad probably voted for the same language only one year ago. This is an amendment to the Constitution. It should be kept very narrow. You cannot anticipate every contingency, and I don't think we should at all. Once you start down that trail of exempting this, exempt that, let's don't include that, let's waive something else, where do you stop it? But clearly, nobody in Washington is going to use Social Security to reduce the deficit and to reduce the national debt. Republicans, Democrats, liberals, conservatives, are all committed to not doing that. This is just a red herring to try to take down the constitutional amendment for a balanced budget.

MS. FARNSWORTH: Okay. We'll come back to some of the other concerns. Sen. Bumpers, how are you arguing against these undecided Senators? How are you trying to keep them from voting for it? What do you argue?

SEN. DALE BUMPERS, [D] Arkansas: Well, I'm telling them it is going to create chaos in the country. It could create a constitutional crisis the likes of which we have never seen before. Let's just assume that after this thing is passed we don't balance the budget. The amendment provides that if the Senate will vote 60 votes, that is 3/5 of the Senators vote to unbalance the budget, then it's unbalanced. Now, a lot of people think that this somehow or other mandates a balanced budget, and it doesn't. It also --

MS. FARNSWORTH: I'm sorry. Let me just interrupt. You mean, it doesn't mandate it because a 3/5 vote can override it?

SEN. BUMPERS: Absolutely. But let's just assume for argument that we refuse to vote 60 votes to unbalance it, and we're obviously out of balance. Let's assume in the middle of the year we're $50 billion well above our projections, and we still refuse to vote 60 votes. You go to the Supreme Court. I suspect the Supreme Court, simply because this is a constitutional issue, will take jurisdiction, just as in the Missouri vs. Jenkins case in Kansas City, where a federal court required the Kansas City School District to raise taxes, raise property taxes, to accommodate integration. So let's assume the Supreme Court said, look, you people are out of balance, you refuse to comply with the provision in the Constitution, that's our job to enforce the Constitution, so we're going to give you 60 days to balance the budget. We come back over here and sort of rain on the Supreme Court, we're not going to let them tell us how to run our business. Sixty days goes by, and the Supreme Court says, you will raise taxes on income by 3 percent, and you will cut spending across the board by 10 percent, and we say we're not going to do that. That puts the President of the United States in the position of having to enforce a Supreme Court order against the Legislative Branch. Now, I don't know that that's going to happen, but I'm telling you that's a possibility. We have never put policy in our Constitution, except one time, and that was the 18th amendment on prohibition. And all we got out of that was organized crime, which is still firmly in place. It was a terrible mistake. I can't tell you. Right now, I have never heard as many "I don't knows" as I've heard during the debate on this amendment. You ask the floor manager, the big proponent of this, Sen. Hatch, Sen. Lott, or anybody else, who will have standing to sue, when can you sue, when does the case ripen, will the Supreme Court take jurisdiction, the answer is, I don't know to every one of those questions.

SEN. LOTT: I tell you what. I do know. It's very simple. This is a constitutional amendment for a balanced budget. This is to set up a process to begin to control spending. You can stand here on any amendment, any bill, and say what if, it may be this, may be, may be that, look, this is just to try to get an instrument to get the Congress to get its fiscal house in order. In fact, the Democratic leader, Tom Daschle, just last year said this, "By adding a balanced budget amendment to the Constitution, we as a nation are embracing the principle that government should not spend beyond its means." That's what's involved here.

MS. FARNSWORTH: But, Sen. Lott, let me interrupt one second. What about this? This is a question many critics have raised. It's a question of enforcement and the courts getting involved in it, and, in fact, Senator -- you know, we just heard the argument. What is your answer to that argument?

SEN. LOTT: The courts may get involved at some point if there needs to be a ruling on a balanced budget, but this particular case he mentioned in Missouri was a federal court dealing with a state court. It's never come before the Supreme Court. The courts have been very meticulous in the past not to get into the minutia, the details of what the Congress does. The courts -- I'm not fearful of that. They may at some point get involved but only to the extent that the Constitution would allow them to, and they might say, you know, Congress, you have to do something further. But it is up to us to do the job.

MS. FARNSWORTH: Okay, quickly, Sen. Lott, one more question about the questions raised. What about the capital fund, the idea that there should be something -- the states have a capital fund if they have to go over, if they have to build a freeway which takes 20 years, they have a capital fund they can use, but it's not in this balanced budget amendment?

SEN. LOTT: I think and have said over the years that I think we should consider that possibility in the future, and this is not going to prohibit that. This is no excuse, though, not to pass the balanced budget amendment at this time. That is something we can still come back and consider statutorily here in the Congress. I wonder why we haven't done that in the past, quite frankly.

MS. FARNSWORTH: Okay. Sen. Conrad, what about that? You've heard sort of both sides now on some of these issues. We can't cover every issue you raised. Are you hearing anything that eases your mind one way or the other, and also, what do you like about this amendment?

SEN. CONRAD: Well, first, let me correct my dear colleague, Sen. Lott, on how I voted last year. I voted against the constitutional amendment that assumed we would loot the Social Security trust fund in order to balance the operating budget, and I've always felt that that was an inappropriate policy, and I must say to you it is very clear from the language of this amendment that it contemplates looting the Social Security trust fund in order to balance the budget. That's just wrong. On the question of a capital budget --

MS. FARNSWORTH: Senator, let me interrupt you there just one second. Doesn't that mean you will vote against it, because there's already been, what, one amendment, maybe two amendments, to try to deal with this Social Security problem that were defeated, right?

SEN. CONRAD: Yes, but we could still --

SEN. LOTT: One passed. One passed saying that --

MS. FARNSWORTH: Okay. Sorry.

SEN. LOTT: -- we would not use Social Security.

MS. FARNSWORTH: Well, that's a resolution, though.

SEN. CONRAD: Let me make clear, though, that that's eye wash. The amendment that passed was eye wash. The amendment that would have had a real constitutional effect failed. We might still have another opportunity, so it's a little hard to prejudge.

MS. FARNSWORTH: Okay. So that still could happen?

SEN. CONRAD: Where we conclude. Let me just say on this question of a capital budget, it is precluded by this amendment. We had a vote on that very question, and that amendment was defeated. On the question of the courts, we had an amendment on that question that would have specifically precluded the courts from coming in and writing the budget of the United States. Let's face it. No judge was ever elected by the people of the United States to write the budget for this country, and I don't think we want to start the precedent of allowing the courts in. We had an amendment on that question, and the amendment that would have made it clear it wasn't the role of the courts was rejected, so those are all disturbing developments.

SEN. LOTT: Do we want to start off, though, with a constitutional amendment saying, oh, and by the way, the federal courts can't be involved?

MS. FARNSWORTH: What do you think about that? Sen. Bumpers, what do you think about that?

SEN. BUMPERS: I don't agree with that. I think the Constitution, which is the organic law of this nation, has to have some mechanism for enforcement. And I'm saying that the only enforcement here would be one by probably the Supreme Court that would be totally unpalatable to the people of this country. The Supreme Court justices are not elected to anything. As a matter of fact, no federal judge is elected to anything. And, yet, what we're getting ready to do is put a few words in the Constitution that say, well, we're rather spineless now, we don't have the spine to deal with it now, but if we put a few words in the Constitution, that will stiffen our spines. Nobody believes that, and so what does that do? That leaves a bunch of unelected officials with the right to raise taxes, cut spending, all of the things that the judge in the Kansas City case did.

MS. FARNSWORTH: Okay. Sen. Lott, let me ask -- I want to move this to another point now. Correct me if I'm wrong, but I think I read that you had argued on the floor of the Senate that the process of getting this passed in the states is a kind of safety valve, that as they're -- if it does pass in the Senate -- as they're looking at it, they'll be watching what the Congress is doing with the budget, and if they don't like what they're seeing, they won't pass it. Did I interpret that right, and could you expand on that?

SEN. LOTT: Well, I mean, the House passed it 300 to 132 on a large bipartisan vote. In the Senate, we've had a number of amendments, and most of them have been bipartisan votes, but if the Senate acts on this and passes it, it then goes to the states. Thirty-eight states with state legislatures would have to ratify it. So I mean, they will get a chance to look at it. I want to make this point. We have spent now several days, basically three weeks, on this constitutional amendment for a balanced budget. The one I think last year only took like seven days. There are still 37 amendments pending. So the opponents of this legislation are just trying to drag it out, raise every possible distraction to try to, you know, prevent a final vote which would pass it and send it to the states. Let the people decide if this is something they really want to put in the Constitution.

MS. FARNSWORTH: Yes, please, Sen. Conrad and Sen. Bumpers, tell me what you think about this view of the process of the states passing it, seeing it as a kind of safety bound.

SEN. BUMPERS: You know, the founding fathers gathered in Philadelphia in 1787, and they spent 119 days behind closed doors deliberating 18 hours a day on this Constitution. Over 11,000 proposals to amend the Constitution have been introduced since it was passed, over 11,000. If you take the 10 Bill of Rights out, the people of this country have only seen fit to deal with the Constitution on 17 occasions, and one of those was prohibition, which we repealed. Now, they want to say, well, let's hurry up and get this done. I belong -- when you start talking about amending the Constitution, which was crafted by the most brilliant men ever assembled under one roof -- I belong to the "wait just a minute" club. There are so many -- the reason this is taking so long is because every time you ask a question, they say, I don't know. And I'm telling you I'm not going to vote for something that's that obscure, that arcane, and that potentially explosive in creating an unbelievable constitutional crisis in this country.

MS. FARNSWORTH: Sen. Conrad, can I just get your view quickly.

SEN. CONRAD: Just to respond, I would say this to you, I personally believe this may be the most important vote I ever cast as a member of the United States Senate. And I want to make certain that the vote I cast will stand the test of time, that it doesn't just be a vote that looks good 10 days from now --

SEN. LOTT: It's very popular now.

SEN. CONRAD: -- 10 years from now -- I want to make sure this is a vote that looks good 30 years from now and 50 years from now, because, remember, we are talking about amending the Constitution of the United States. This is something that may stand for the next 200 years.

MS. FARNSWORTH: Are you getting a lot of pressure on this in your home state, a lot of ads?

SEN. CONRAD: Well, I'm getting ads run by the Republican National Committee. I can just tell you, I don't think that's a very effective way of influencing, influencing a member. I report to the people of North Dakota. I don't report to the Republican National Committee.

MS. FARNSWORTH: Well, can you tell us specifically what you would need, just quickly, to make you vote for it or can you not tell us?

SEN. CONRAD: Yes. Very quickly. It would take a constitutional amendment that included a measure that made clear the Social Security trust fund was not going to be looted. We would have to make certain that the courts are not going to be determining the budget of the United States, and I think we should have provision for a capital budget. If we had a constitutional amendment before us like that one, as we did last year, I would vote for that.

MS. FARNSWORTH: Sen. Lott, is that likely to happen?

SEN. LOTT: I don't think all three of those would happen, but, you know, if -- you know, it's still possible. As I said, there are 37 amendments pending, that one or some version of some of those may pass, and I'm sure he would review it at that time. But let me make this point again on the decision toward the states. The last two constitutional amendments that the Congress passed did not get ratified by the states. We haven't had one ratified by the states since 1971. I believe it was the last one that was ratified. The other thing is that people in Congress that for years and years and years have wanted to have a free rein at spending the people's money do not want this legislation. Some of the people that raised the Social Security question were the same people last year when Social Security taxes were being raised on the retirees, they thought that was okay. Now they say, oh, but my goodness, you can't touch Social Security. There's a little bit of a gap here between why they are talking and voted last year and what they're saying this year.

MS. FARNSWORTH: Senators, I'm afraid that's all we have time for. Thank you very much. I'm sure we'll come back to this issue. Thank you for being with us. Good night.

MR. MAC NEIL: Still ahead, selling American arms and the future of the CIA. FOCUS - ARMS FOR SALE

MR. MAC NEIL: Next, the big business of selling American weapons to countries overseas. President Clinton is expected soon to issue a long-promised directive on sales of conventional loans such as aircraft. The United States has emerged as the world's largest exporter, and there's much debate whether the new directive will change existing policy. Correspondent Jeffrey Kaye of KCET-Los Angeles reports.

JEFFREY KAYE, KCET-Los Angeles: In the late 80s, 30,000 people worked on this mile-long assembly line in Fort Worth, Texas. At its peak, this factory each year produced some 300 F-16 fighter planes, most of them for the U.S. government. Today, because of U.S. defense cutbacks, the job force has been reduced by more than half. Thirteen thousand people produced F-16s, but the planes made by Lockheed are primarily for export. A. Dwain Mayfield is a vice president of Lockheed, Fort Worth. Without the foreign sales, what would this line look like?

A. DWAIN MAYFIELD, Lockheed, Fort Worth Co.: This line would look quite, quite bare right now, Jeffrey, in that the since the 1987 time period the U.S. has gone from buying roughly 200 airplanes a year down to no fighters to be bought in the U.S. this year. Now, we have a few remaining that we're building for the U.S. Air Force, and I pointed out one of those in the area here, but basically our, our production through the year 2000 will be sustained by foreign production.

MR. KAYE: At international arms bazaars, such as the Annual Paris Air Show, the F-16 has been a hot commodity not only for a curious public audience for foreign governments shopping for military equipment. Arms exports have become an increasingly important component of the U.S. weapons industry in general. Sales to foreign customers were helped by the Gulf War, which served as a showcase for American weaponry, and by the diminishing role of Russia as an arms supplier. Although the global arms market has shrunk since the end of the Cold War, U.S. arms exports have remained level at about 12 to 14 billion dollars a year. As a result, the U.S. share of the global arms trade has doubled. U.S. sales now account for about 55 percent of all weapons transfers. Joel Johnson of the Aerospace Industries Association feels the welfare of the industry should play a role in U.S. arms policy.

JOEL JOHNSON, Aerospace Industries Association: Once the government's made the decision it's okay to make the sale, the government ought to do everything in its power to make sure the sale is an American sale. Part of the reason is jobs, exports, a billion dollars in exports is 23,000 dollars worth of jobs.

MR. KAYE: But the jobs argument is not convincing to policy critics, troubled by the dominant role the U.S. has come to play in international weapons sales. Defense cutbacks have cost thousands of jobs in the region represented by Los Angeles Congressman Howard Berman, but Berman believes arms exports should not be used to protect American jobs and industry.

REP. HOWARD BERMAN, [D] California: It's substituting the energy that should be focused on defense conversion, retraining, advancing our technologies in commercial areas. I'm strongly against this notion of arms exports as the, as the way to deal with the downsizing of our defense industries in this country. And I'd like to see the administration become more aggressive in leading the way towards effective multilateral restraint.

MR. KAYE: In the debate over arms policy, the F-16 fighter plane is used an example by all sides.

SPOKESMAN: [Lockheed Segment] Ladies and gentlemen, once again we'd like to present the first Venezuelan F-16 fighting Falcons!

MR. KAYE: Foreign sales have made the F-16 one of the largest military production programs in history.

1ST SPOKESMAN: I am sure that our project will positively contribute to the security in the Korean peninsula.

2ND SPOKESMAN: This is a great day for Bahrain.

3RD SPOKESMAN: This roll-out marks an important milestone in the modernization program of our armed forces.

MR. KAYE: The planes have been sold to 17 foreign countries over the last 20 years. But it wasn't until 1992 that retaining jobs and protecting U.S. industry became a significant part of the arms policy equation.

PRESIDENT GEORGE BUSH: [September 1992] I am announcing this afternoon that I will authorize the sale to Taiwan of 150 F-16AB aircraft made right here in Fort Worth. [cheers]

MR. KAYE: President Bush's controversial sale of F-16s to Taiwan was made after intense lobbying by the defense industry which argued that exports meant jobs. The Bush and Clinton administrations have held that prudent foreign arms sales allow the U.S. to preserve a needed industrial base such as the capacity to make F-16s. William Reinsch heads the Commerce Department's Bureau of Export Administration.

WILLIAM REINSCH, Commerce Department: You don't stop making something and decide a year from now that you want to make something else and go up and start all this stuff up again. It is billions and billions of dollars to set up these kinds of assembly lines, to train the workers, to find the engineers, and to get everybody, you know, get the entire set of machinery, by which I mean human machinery, as well as, you know, mechanical machinery together to make a very, very complex product. If you let all that disappear and disassemble, you multiply tremendously the problems of trying to put it back together again.

MR. KAYE: But Lora Lumpe, director of the Armed Sales Monitoring Project of the Federation of American Scientists, feels economic considerations play too prominent a role in arms policy.

LORA LUMPE, Federation of American Scientists: Selling these weapons has long-term implications that selling tanks or cars or toasters do not have, and I -- I frankly believe that this whole process of making sales more routine and more commercial is, is a dangerous path not only in that we are directly contributing to, to warfare and stability, regional chaos, we're also sending a signal out to the other major arms supplying countries that arms sales are a commercial endeavor.

MR. KAYE: Sales of F-16s to Turkey illustrate the debate. In July 1987, Turkish officials gave the "thumbs up" when the first F-16s were sent to that country. Eighteen months later, when the first F-16s were delivered to Greece, Air Force officers there broke out the champagne. Greece and Turkey are both NATO members, but tension between the two countries is high. Policy critics suggest that arming both sides in an arms race increases tensions. Supporters contend the arms sales are stabilizing. Arms sales to Turkey have also come under criticism because of Turkey's human rights record. Thousands of refugees have fled villages destroyed in the government's campaign against Kurdish rebels. Even the U.S. State Department has criticized Turkey for inflicting civilian casualties. Turkey denies allegations of abuse, but human rights groups have accused Turkey of using U.S.-supplied helicopters and F-16s in attacks on villages. Are you troubled by that, as a supplier of the plane?

A. DWAIN MAYFIELD: Well, again, you know, we very seldom get into, into the usage of the airplane, and I would say, no, again. People who determine policy and control the use of our technology are the people who, who worry about that.

MR. KAYE: One policy maker is the director of the U.S. Arms Control & Disarmament Agency, John Holum. Holum says various government agencies evaluate the policy implications of all arms sales.

JOHN HOLUM, Arms Control & Disarmament Agency: The human rights situation in a country like that is a factor that would argue against supplying the arms, but it's not the only factor that's taken into account. We also consider the possibility that if we don't supply arms to an allied country, or a country that has security interests in common with the United States, that they may -- we may be called upon in some future case to send our own troops there because they don't have the capability, the capability to defend themselves.

PROMOTIONAL VIDEO SPOKESMAN: TAI delivered its first F-16 to the Turkish air force and became --

MR. KAYE: Critics say another problem with current policy is the U.S. role in spreading weapons production. American companies are providing increasing numbers of nations the capacity to produce arms, often as conditions of sale. Turkey is one of twelve countries that either assemble F-16s or make F-16 components as part of co-production arrangements with Lockheed.

LORA LUMPE: I believe very strongly that we should not be promoting co-production and license production of weapons systems. Again, this creates more arms industry in more countries at a time when there's already a massive global surplus of arms and arms production.

MR. KAYE: But supporters of the current policy contend arms exports give the U.S. clout.

WILLIAM REINSCH: You do better by engaging other countries, and you do better by dealing with them. You do better by talking with them and being able to talk with them and forming close relationships with all the parts of their government society, including the military, and then you engage them and use that relationship and use that engagement to make your policy point. You don't succeed by walking away from it.

LORA LUMPE: More widely, you proliferate the ability to manufacture a weapons system the more countries are able to turn elsewhere for re-supply and for spare parts, undermining our alleged control over the use or non-use of those weapons.

MR. KAYE: Instead of extending U.S. exports, critics feel the administration should set an example of restraint and at the same time seek a multination agreement to control the arms trade.

REP. HOWARD BERMAN: The problem is we won't get a multilateral arms restraint regime unless we lead the way, unless we both make it a top diplomatic priority and show by our own conduct that we're serious about it because the French and the Russians and the Chinese will just laugh at us if we pose on them -- propose serious multilateral regimes while we're just willy nilly peddling arms.

MR. KAYE: The Clinton administration points with pride to the fact that the Commerce Department has beefed up the government's support and promotion of arms exports.

WILLIAM REINSCH: The fact that we do advocacy well, and we do do it well, not just in defense, we do it, as I said, in the civilian sector also, I think is to the administration's credit, whether it's a defense sale or, you know, the Indonesian telephone system or, or computers, or whatever it happens to be. If we're going to decide as a country that we want a sale to occur, then it seems to me to be a logical conclusion that we should devote our energy to making that happen.

MR. KAYE: While critics urge greater restraint, others see an even larger role for the government in promoting arms exports. Commerce Department Secretary Ron Brown and the arms industry advocate U.S. loan guarantees for arms exports. The final decision rests with the President, who is considering loan guarantees as part of his long-awaited policy directive on conventional arms. CONVERSATION - SECRETS

MR. MAC NEIL: Finally tonight, another in our conversations about the future of intelligence after the Cold War. Tonight, we get the views of an analyst who served at the Central Intelligence Agency for 20 years. Melvin Goodman was director of Soviet Foreign Policy Analysis until he resigned in 1986, protesting against what he called politicizing of the agency. In 1991, he was among former CIA officials who testified against the nomination of Robert Gates to be CIA director. Mr. Goodman is now a professor of national security at the National War College and has written numerous articles on the subject of intelligence. Mr. Goodman, thanks for joining us.

MELVIN GOODMAN, Former CIA Official: Thank you, Robin.

MR. MAC NEIL: The CIA has been criticized in this series of conversations, beginning with Sen. Daniel Patrick Moynihan, for failing to foresee the collapse of the Soviet Union. Till 1986, you were the chief analyst, Soviet analyst. What happened?

MR. GOODMAN: Well, I think the major problem was one of politicization. There were some analysts -- not many but a few -- who saw the weakness of the Soviet Union, not necessarily predicting the disintegration but knew that there were very serious problems. It became very difficult in the environment of politicization in which Casey and Bob Gates had introduced into the CIA to get that story across, therefore, when you had the CIA failing to miss the Soviet collapse, there was this problem of could they have gotten it right, or could they have done a better job if they had gotten the story out?

MR. MAC NEIL: Do you mean that the Reagan administration had such a big political stake in portraying the Soviet Union as a continuing menace that you at the agency tailored your intelligence to that view?

MR. GOODMAN: Exactly. The problem was trying to justify very large increases in the defense budget during the early and mid 1980s, and to do that, you had to show a Soviet Union that was extremely strong, an economy that was still expanding, oil production that was increasing, therefore, any attempt to show weaknesses in the society, weaknesses in the economy, weaknesses in foreign policy, conciliation in arms control, for example, it was very difficult to get this kind of material outside of the agency. At the same time, you had politicization of intelligence where you had a story made up out of whole cloth. And that, of course, was the papal assassination memo.

MR. MAC NEIL: So in other words, all the huge resources of the CIA and other intelligence apparatus, it wasn't really until Mr. Gorbachev came out and announced to the world that they had been fudging their own books and, and basing their projections of economic growth on, on mining -- selling their own raw materials and things that, that the world knew that the Soviet economy was collapsing?

MR. GOODMAN: Well, that's true. As late as 1986, the CIA was still saying that the East German economy was as large as the West German economy. As late as 1985, 1986, the CIA was still saying that the Soviet economy was about 60 percent the size of the American economy. So it was very late that the CIA realized that there was a tremendous economic burden from the Soviet defense spending, and essentially the system of the Soviet economy was corrupt and was falling apart.

MR. MAC NEIL: Is the CIA still politicized?

MR. GOODMAN: I don't think so. I think there were corrections that Jim Woolsey has made, even though you had the incident involving Haiti, when clearly the CIA was presenting intelligence to the Congress based on operational collection that was flawed, so that issue was politicized. But Woolsey has created another problem, because what he has done is to create a partnership, a merger between the operations side of the House, which is involved in clandestine activity, and the intelligence side of the House, which must remain open in order to provide objective analysis to Congress and the President. So I think the new director is going to have to reverse this tendency because you will run the risk of politicization if it is not reversed.

MR. MAC NEIL: Spell out what you say happened in the case of Haiti.

MR. GOODMAN: In the case of Haiti, you had operators in the field clandestinely collecting intelligence. This is related to policy. Their sources were primarily opponents of Aristide, therefore, the intelligence that the CIA was producing and that analysts were putting together was based on clandestine collection that was flawed because we were really only talking to the opponents of Aristide. Now, of course, the analysts should have been more careful, more zealous. They should have scrutinized this material more carefully but they didn't, and that's why you got the great flaw in the CIA presentations to the Congress on Haiti which became an embarrassment for the Clinton administration.

MR. MAC NEIL: How do you correct that politicization?

MR. GOODMAN: I think one way of correcting it is fundamentally separating the intelligence side of the House, that is analysis from the espionage side of the House. Richard Helms I think made the same point the other night during one of these interviews. And I support that completely.

MR. MAC NEIL: You mean within a different organization or within the same organization?

MR. GOODMAN: Well, preferably, if I had my druthers, it would be a separate organization, but if you can't arrange that, if it's impossible to do anything until the Aspin Commission reports, then there must be very strong and high walls built between the intelligence side of the House and the espionage side of the House. These are the walls that Woolsey has knocked down. They must be rebuilt.

MR. MAC NEIL: Something I don't quite understand there, maybe I'm slow in getting this, if there is a clandestine operation, presumably it has the support of the administration unless the CIA's doing something on a rogue basis on its own. So if the administration is ordering the CIA to do something clandestine and those operatives are then reporting back, as in the case of Haiti, with intelligence that goes against what the administration's policy is, it doesn't make sense.

MR. GOODMAN: Well, you have put your finger on the problem. The clandestine side of the House is responsive to policy. Intelligence cannot be responsive to policy. Intelligence has to be open. It has to be able to tell a policy maker that the policy is wrong, that the policy is flawed. If you look at the Pentagon Papers, and you look at the CIA analysis of Vietnam, you will see that the CIA was exactly right about the difficulty we had entered into in Vietnam and why the policy was going to fail. At the same time, you have clandestine agents in the field collecting intelligence to support the policy with regard to Vietnam, but analysts can't be part of policy advocacy. They can't be out there doing the work of the policy makers. That is why the CIA was created in 1947 by Harry Truman, to have an independent voice with regard to intelligence.

MR. MAC NEIL: Where would you put the operational side of it, the clandestine operational side of it, if you had the structuring of it?

MR. GOODMAN: I would keep the operational side in the CIA. I would make it much smaller. I would restrict covert action to very few requirements. I would take paramilitary activities and give those activities to the Pentagon. I would get out of the business of trying to control elections, trying to insert false propaganda in newspapers around the world, and instead of using covert action to bring down governments, which we have done in the history of the CIA, I would use --

MR. MAC NEIL: And failed to do.

MR. GOODMAN: -- covert action in a modified way to build societies, fragile democracies in Eastern Europe, in the Caucuses, where it's very difficult to get aid in on a timely basis. You could use covert action to build, rather than to destroy.

MR. MAC NEIL: Sen. Moynihan suggested that some other -- he wanted to abolish the CIA altogether but said it wasn't necessary anymore -- but he said some other functions could be taken away, that political intelligence could be returned to the State Department, military intelligence to the Defense Department. What do you think about those suggestions?

MR. GOODMAN: I disagree completely with that, Robin. It would be very dangerous to give military intelligence to the military. In fact, Sen. Moynihan said it in a way that should raise alarm signals. He said the military will only believe the intelligence that the military produces. Well, I don't think the President will believe that kind of intelligence, and I don't think the Congress will accept that kind of intelligence. So I think it's very important to keep an independent voice with regard to intelligence. That's why it cannot go to the military and it cannot even go solely to the State Department.

MR. MAC NEIL: Looking outside the agency for a moment, which spends only $3 billion of some $28 billion that this country spends on intelligence, are there other areas where money can be saved?

MR. GOODMAN: Yes. I think there is tremendous redundancy in military intelligence. You have each branch, each service with its own military intelligence staff. There's tremendous redundancy there, so there you could have savings. I think in the area of collection systems, because you have each one of the intelligence agencies, NSA, NRO, the CIA, DIA, bidding on systems from American contractors, I think there is a tendency to bid up the prices of these various collection systems which are very expensive to begin with. So I think there is some savings there if you could systematically review intelligence requirements in collection devices.

MR. MAC NEIL: If you could, yourself, streamline the CIA, give it strong leadership, and depoliticize it, what would you have it then do differently in this new world than it's been doing?

MR. GOODMAN: Well, I think the major thing --

MR. MAC NEIL: You sketched out some, I know, a moment ago, but what would be the most important thing?

MR. GOODMAN: Well, one thing that the CIA must do differently is forget the Cold War, try to put the Cold War behind you, and in intelligence what that means is you have to look at adversarial relationships, of course, because you have to look at threats to the United States. But at the same time, you have to look at the nontraditional causes of conflict around the world. You have to look at ethnicity, energy problems, economic problems, environmental problems. These are the nontraditional issues that Bob Gates and others would pull out of the CIA and return to other agencies. I think these issues, these systemic problems, these nonmilitary problems, are going to be the sources of conflict and confrontation around the world, and this is where the CIA is going to have to become central. And right now, the CIA is not central to the analysis of these problems.

MR. MAC NEIL: Let's go back to the politicization point, your main point at the beginning. Are you saying that each President really gets the CIA that he deserves because he, in effect, creates it each time?

MR. GOODMAN: Well, we didn't have that until Jimmy Carter made Adm. Turner the director of Central Intelligence, which in a way was the first time a President introduced his own director of Central Intelligence. Now, Adm. Turner did not politicize intelligence. Actually, the admiral was quite open-minded about intelligence, but Reagan followed Carter. Reagan introduced Casey to the CIA, and politicization began then. It was a policy that Gates continued, and Webster just was not zealous enough in trying to correct, so that's why in a way you have the Ames disaster, which is symptomatic --

MR. MAC NEIL: How does that follow the Ames disaster?

MR. GOODMAN: There's not a direct linkage, but you have to remember that the CIA was involved in things in the mid 1980s like the Iran-contra problem, where the CIA should not have had a role at all. So you asked the question the other night, why wasn't the CIA more zealous with regard to monitoring the activities of Ames, and why didn't they react when there were clues to what Ames had been doing for nearly, it turned out to be, a decade? The problem was the CIA leadership was looking elsewhere. They were protecting their own flanks with regard to Iran-contra, and that is why the high level administration of the CIA was very slow to react to the Ames crisis, and why one of the things, one of the first things that a new director must do, is remove that first level of leadership whose careers were intertwined somehow with the failures of the past, both politicization and the Ames crisis.

MR. MAC NEIL: Let me just ask you briefly, as Air Force Gen. Carns, whom the President has nominated, the man to do all that?

MR. GOODMAN: Well, I don't know. We don't know too much about Gen. Carns. He's been described as a good wing man. The CIA needs a flight leader. The fact that he has worked for people as important and as difficult as Gen. Powell and Gen. McPeek and survived that suggests that this is a very tough-minded individual. So if he has a certain amount of vision and he's willing to take tough actions, and he's willing not to wait for the Aspen Commission to report, I think he will be quite successful.

MR. MAC NEIL: Well, Mr. Goodman, thank you very much for joining us.

MR. GOODMAN: Thank you very much for having me. RECAP

MS. FARNSWORTH: Again, the major stories of this Thursday, the House of Representatives passed a bill aimed at changing U.S. defense and foreign policy. It includes limits on U.S. involvement in United Nations peacekeeping missions, and Attorney General Reno announced that the Justice Department has begun a preliminary investigation into the personal finances of Commerce Secretary Ron Brown. The Department has 90 days to decide whether a special prosecutor is warranted. Good night, Robin.

MR. MAC NEIL: Good night, Elizabeth. That's the NewsHour for tonight, and we'll see you again tomorrow night. I'm Robert MacNeil. Good night.