The MacNeil/Lehrer NewsHour

INTRO

ROBERT MacNEIL: Good evening. The major story of the day was Jesse Jackson's adventure in Cuba. The Democratic presidential candidate persuaded Fidel Castro to release 22 American prisoners. The White House welcomed that, but was cool to closer relations with Havana. The Supreme Court said college football contract arrangements with TV were illegal. President Reagan defended his record with Moscow and said he wants more dialogue with the Kremlin. NASA said the shuttle spacecraft Discovery was only slightly damaged yesterday and might be ready to go again within two weeks.Jim?

JIM LEHRER: A rundown for the hour tonight includes a debate over Jesse Jackson's suggestion about renewed diplomatic relations with Cuba and an explanation of the ins and outs of today's Supreme Court decision on televising college football. Plus a documentary report on how and why the drive to make synthetic fuel has faltered, and a review of Intimate Memoirs by Georges Simenon, creator of France's most famous detective, Inspector Maigret.Truce with Cuba?

MacNEIL: The Reagan administration today gave a mixed reaction to the latest diplomatic coup by Democratic presidential candidate Jesse Jackson. After long talks with Fidel Castro in Havana, Jackson announced overnight he had persuaded the Cuban leader to release 22 American prisoners, mostly drug traffickers, from Cuban jail. They were being processed today, and Jackson plans to bring them home tomorrow. The White House welcomed the agreement to release them and Castro's offer to open talks on returning 1,200 Cuban exiles, mainly criminals, who reached the U.S. in a massive boatlift four years ago. At the same time, Assistant Secretary of State Elliot Abrams was calling Cuba oneof the worst tyrants of our time and an even more ruthless dictator than the man he overthrew in 1959, Fugencio Batista. Abrams was testifying to a House Foreign Affairs subcommittee on human rights. At the State Department, spokesman John Hughes said the U.S. regretted that Castro had not agreed to release any political prisoners. Another point in Jackson's agreement with Castro was that the United States and Cuba should normalize relations. Cuba was said to be willing to exchange ambassadors with the U.S. if the Reagan administration will agree. The State Department indicated there was little chance the U.S. would accept that. U.S. relations with Cuba were severed in 1961, though each country now maintains a low-grade diplomatic mission called an "interest section" in the other's capital. Jesse Jackson came to Cuba after trying to arrange ceasefire talks in El Salvador. After eight hours with Castro, he appeared at a news conference after midnight.

JESSE JACKSON, Democratic presidential candidate: President Castro has agreed to release 22 persons who are American-born citizens. These persons represent substantially all the Americans now in prison in Cuba.

MacNEIL [voice-over]: Today Castro met the 22 Americans who -- Jackson met the 22 Americans who will be released at a high security prison 12 miles outside Havana. He told them he would make no judgments about why they were in prison but would simply take them home to their families. Then the prisoners held some emotional reunions.

[on camera] Jackson was due to complete what he is calling his four-nation peace mission with a visit to Nicaragua tonight. White House spokesman Larry Speakes said there were no plans for President Reagan to meet him as he did when Jackson obtained the release of American Navy flier Lieutenant Robert Goodman from Syria.

Jim?

LEHRER: To the question, should the United States take steps to normalize relations with Cuba? Wayne Smith says yes, Jackson's right.Congressman Henry Hyde says no. Mr. Smith served as chief of the U.S. interest section in Havana from 1979 'til 1982; he is now a senior associate at the Carnegie Endowment for International Peace. Congressman Hyde is a Republican from Illinois and a member of the House Western Hemisphere Subcommittee. Congressman, what's wrong with normalizing relations now with Cuba?

Rep. HENRY HYDE: Well, I think the symbolism would be all wrong, and that's all it would be -- it would be symbolic. We have an interest section there; they have an interest section here; there are skilled diplomats to attend to the business of diplomacy. To upgrade the status of our institution there to that of ambassador simply sends the wrong signal. All we've gotten out of Castro in four years was exporting subversion to Nicaragua and the Mariel boatlift.So I just think the signals to Honduras, to Costa Rica, to El Salvador and the rest of the area would be wrong.

LEHRER: How would you read the signals, Mr. Smith?

WAYNE SMITH: I wouldn't altogether disagree with Congressman Hyde. I think we should move in the direction of normalizing relations, but we should do so by focusing on, by addressing, the real problems that exist between us, the disagreements. We should begin to discuss them and try to put them behind us. Yes, we do have a conflict of interest in Central America. I think the administration perhaps has exaggerated the extent of Cuban involvement, but there is Cuban involvement. And that is a matter of legitimate concern to us. Where I would part company with the administration, and I take it with Congressman Hyde, is that it seems to me we should be discussing that with the Cubans and trying to solve it through diplomacy. That's not to say that force is ruled out, but let's try diplomacy also. And I really don't think that we have given that a fair try.

LEHRER: Do you agree?

Rep. HYDE: No.I think that anytime Mr. Castro wants to talk in a reasonable fashion, or even an unreasonable fashion, about taking back some of the criminals that they unceremoniously dumped on our shores, that would be a great gesture of good faith and good will, and we're certainly ready to talk about that, anxious to talk about that.

Mr. SMITH: That hasn't been true, if I might say so. Castro has been offering to discuss that along with the whole immigration package since February of 1981. It took this administration until May of 1983 to even ask him to take the criminals back. His reply was he would discuss that along with the other immigration issues. And, hopefully those issues now will be discussed --

LEHRER: But they're not being discussed --

Mr. SMITH: -- after the elections.

LEHRER: But they're not being discussed now?

Mr. SMITH: No. The administration indicated that it now would be willing to discuss them and Castro's response was, let's wait until after the November elections.

Rep. HYDE: He's moved that up now to he'll talk about them now.

Mr. SMITH: That is -- that may be a very significant concession; I'm surprised at that, frankly.

Rep. HYDE: I think he's conceding the election, Mr. Smith.

LEHRER: To Ronald Reagan.

Mr. SMITH: That might be so interpreted. I don't choose to interpret it that way.

LEHRER: Congressman Hyde, are you impressed at all by this latest coup of Jesse Jackson's?

Rep. HYDE: No, I'm not. When he went to Syria he brought home a hero. He went to Havana and he's bringing home 22 people who have been -- many of whom have been charged with drug charges, and I think it was a propaganda gesture that served both Castro and Jesse Jackson. But the only thing we've gotten out of it is his agreement to start talking with us about things that ought to be talked about, but there are no human rights discussions were held, no political prisoners were released. We had testimony today from people who have suffered down there for many, many years in their prisons for daring to disagree with the Communist regime. So there's a lot to talk about, but I don't see anything other than political propaganda out of Jesse Jackson's visit.

LEHRER: How do you view it?

Mr. SMITH: Except that if indeed Castro has indicated his willingness to now discuss the return to Cuba of the some 1,500 criminals, that is a significant concession, and of course Jackson indicates that he will continue to discuss the matter of the political prisoners with Castro, and I think it's possible that Castro might let a few go Thursday as Jackson comes back through. It's possible.

Rep. HYDE: I wonder if I might add that while Mr. Smith has indicated an intransigence on the part of the Reagan administration to even talk to Castro, I talk to people such as General Walters, who has talked to Castro, and Fidel has said we will not negotiate the export of subversion to Central America. We'll talk about bringing the troops back from Angola, we'll talk about taking the criminals back, maybe, but we will not talk about exporting subversion to Nicaragua, and that really has held up any real progress.

Mr. SMITH: I would take very sharp issue with that. I do not believe that is what Castro said to General Walters, and even if it --

LEHRER: Let's just identify General Walters here quickly. He is now kind of an ambassador --

Mr. SMITH: A diplomatic troubleshooter --

LEHRER: A diplomat at large, yes. Former number-two man, CIA.

Mr. SMITH: Ambassador at large and the nature of his conversation with Castro has never been really clarified by the administration. That's not my readout of what was said, but even if it was at that point, Castro has subsequently indicated his full willingness to discuss the Central American equation or the problem with us, and to join with us and with others, with the Contadora nations, in seeking a peaceful solution. Last July, for example, Castro indicated his willingness to consider, along with the Nicaraguans or in consultation with them, the withdrawal of his military personnel from Nicaragua and to respect an arms embargo for Central America if the United States would do likewise.I can see a number of reasons why the U.S. government would not wish to accept that formula. But surely it was worth thoroughly exploring and trying to find some formula that was acceptable to us.

Rep. HYDE: Well, Mr. Smith, that's what General Walters told me in my office and Caveat, the book by Alexander Haig, recounts a meeting with the vice president of Cuba, Mr. Rodriguez, in Mexico, where they discussed these very same things, and it went right along the line, as I've indicated. They're just not interested in halting the export of subversion.

Mr. SMITH: Well, that simply isn't true, Congressman Hyde. At the same time that Ambassador Walters, as Castro was saying this to him, the Cubans were saying to me in Havana that they were willing to discuss it and were suggesting meetings and agendas. So it's awfully difficult to accept that that was the outcome of that meeting.

Rep. HYDE: Well, if I could believe that the Cubans would seriously consider halting the export of subversion to Nicaragua, I would think that would be a tremendous achievement.And if you say they're willing to do that, why, I'm for it. I'll lead the applause.

Mr. SMITH: If I didn't think they were, I wouldn't be interested in normalizing relations with Cuba. So I think we agree on that.

LEHRER: Back to Jesse Jackson for a moment. James Reston, the New York Times columnist, suggested this morning that what Jesse Jackson did was improper in the first place, to go down and get involved in this kind of ad hoc diplomatic -- what's your view of that, Congressman?

Rep. HYDE: Well, improper is probably a good word. I think it was certainly appropriate for his political campaign. He rolled the dice to see if he could spring some American citizens and then give the appearance of the great savior, the great diplomat. I don't think he succeeded. They, you know, Castro sent us his drug dealers and now he's sending some of our own back to us. We're getting a lot of people in the drug traffic from Castro. That's no achievement. But I think he's exploiting troubled situations in the world and doing it effectively. He got a lot of coverage --

LEHRER: Jesse Jackson is?

Rep. HYDE: Yeah. We're talking about him, aren't we? So he's succeeded.

LEHRER: Sure. Sure. What's your view of that, Mr. Smith?

Mr. SMITH: I, on balance, I tend to think that it was a positive development because I share the reservations about this kind of public diplomacy. There are definite risks involved. But in the case of U.S.-Cuban relations, there's so little really constructive dialogue that perhaps on balance this was useful. And if Castro does indeed take the criminals back, that will have been a real achievement.

LEHRER: How do you think the administration should play this now? Should they step in and take up where Jesse Jackson left off, or kind of keep hands back or step forward?

Mr. SMITH: Oh, that, I think wouldn't be politically, of course, wise for the administration to do, but I think that the administration might take the attitude, well, all right, Castro has said that he is willing to discuss these issues and is interested in normalizing relations; let's begin to discuss them.

Rep. HYDE: It'd be nice if Fidel would release some political prisoners as a gesture of good faith. He's got at least 250, according to Amnesty International, who have been locked up for 20 years and more, and then when their time is up they get resentenced for disagreeing with the administration over there. That would be a gesture, and he had a chance, with Jackson down there, and he blew it.

LEHRER: So your advice to the administration is, nothing's changed, friends, just keep cool and stay the course.

Rep. HYDE: Keep talking.I think we should always have the door open. We should always look down the stairs, as the President said, whether it's the Soviet Union or Castro, but not deceive ourselves. We need some signs of change that we haven't seen yet.

LEHRER: Congressman, Mr. Smith, thank you both very much. Robin?

MacNEIL: In other Central American news, in Mexico, teams of American and Nicaraguan diplomats left the resort town of Manzanillo after two days of secret talks about relations between the two countries. Reporters were not allowed to approach closer than 300 yards from the meeting place, and neither Harry Shlaudeman, the American special ambassador for Central America, nor Victor Hugo Tinico, the deputy foreign minister of Nicaragua, made any comment on what was said or done.

In Washington, Roberto D'Aubuisson, the Salvadoran right-wing leader, met a group of senators today. He denied charges that he was involved in a plot to assassinate the United States ambassador to El Salvador. Later, D'Aubuisson was scheduled to meet Langhorne Motley, the assistant secretary of state who deals with Central American affairs. And Eden Pastora, a rebel leader who has been fighting against the government of Nicaragua, also arrived in Washington today. He was scheduled to brief members of Congress tonight, tomorrow and Friday on the political situation in Nicaragua. Jim?

LEHRER: President Reagan said today all is not grim between the United States and the Soviet Union. He said there was still contact between the two peoples and governments in scientific and cultural areas if not on military and arms control matters. Speaking to a conference on U.S.-Soviet exchanges at the White House, he also said this.

Pres. REAGAN: We've offered comprehensive and sensible proposals to improve the U.S.-Soviet dialogue and our working relationship. And if the Soviets decide to join us, new avenues would open, I think, for your efforts. It's still too early to judge the results. A few proposals are near agreement; many others are still under discussion and some have been rejected, at least for now. Meaningful contact with a closed society will never be easy, and I am as disturbed as you are by recent reports of new measures taken by Soviet authorities to restrict contacts between Soviet citizens and foreigners. We must have ways short of military threats that make it absolutely clear that Soviet actions do matter and that some actions inevitably affect the quality of the relationship.

MacNEIL: In the Persian Gulf war Iraq said its planes hit two ships which the Iraqis described as very large. Both ships were near Kharg Island, Iran's principal oil terminal. The owners of one ship, a 260,000-ton tanker, confirmed it had been hit in the engine room by a French-made Exocet missile. There was no confirmation of damage to a second ship.

Also in the Middle East, Syria and Israel announced they will exchange prisoners tomorrow under an agreement mediated by the International Red Cross. The exchange will take place at Koneitra, a city in the U.N. buffer zone on the Israeli-occupied Golan Heights. The Israelis will send back about 300 Syrian soldiers and 21 civilians. The Syrians will return six captured Israelis.

Jim?

LEHRER: It will be mid-July at the earliest before a third try will be made to get space shuttle Discovery off the ground. NASA said that this afternoon after a day of expert scouring for clues to what went wrong yesterday. Tuesday's attempt was aborted with just four seconds left on the count-down clock after one of the three engines had already fired. The ignition had touched off a small fire, and NASA discovered today the flames burned patches of protective coating off the heat shield. The damage was said to be minor, all trouble having been caused by one faulty valve. And, according to NASA engineer John Talone at the Kennedy Space Center this afternoon, the future still looks good.

JOHN TALONE, NASA engineer: We feel like a failure of a valve, which we don't think -- you know, we don't think, looking at it, it's a generic problem; we feel like it's just a random failure, probably, but that has yet to be determined. If it turns out to be that, there's no reason to think you can't replace that valve and fly because the vehicle is designed to be treated that way. It has to be. It has a repetitious use it has. We have to treat it as if it's an operational vehicle. Things fail, things get fixed, we keep going.

LEHRER: And there was a follow-up today on the airline safety story, the one about FAA official Ralph Kiss and his memo claiming the air control system had become unsafe. Yesterday Kiss told a House subcommittee he didn't really mean it, that he overstated the case to get approval for a new system in the Denver FAA region. Congressman Elliott Levitas of Georgia said that was a lousy way to run an agency, and he repeated it today to today's key witness, FAA administrator Donald Engen.

Rep. ELLIOTT LEVITAS, (D) Georgia: The 10 years that I have sat on an oversight committee dealing with aviation safety and having seen hundreds, thousands of internal memoranda from FAA officials at all levels, I have never seen one which said "for our own -- for safety and our own survival we must act now. The safety of the system is in jeopardy." I have never seen language like that. Now, I'm saying if you want to reject the truth of that, if you want to say that that's not true, then I think you've got to deal with the fact why did he use that type of language? According to him, in order to get the system, to get the bureaucracy to move with enough dispatch and to get something done. Do you see that it's necessary within FAA's bureaucracy to scare the hell out of the people involved in order to get some action done in a short period of time?

DONALD ENGEN, FAA Administrator: I certainly hope not, sir, because if he felt that then I want to deal with that. I want to get in there and fix it. And I'm really interested in the fact that the system is dynamic and is being fixed. I want the flow -- I want the information to flow up as rapidly as possible, and I hope that I've showed you that I'm interested in improving our internal communications so that we can have faster communications coming up. But, above all, if you recall, sir, I want to be sure to push down to the lowest level possible the authority to fix it on the scene and get ahead with keeping the system safe. And that's what happened in this particular case.

MacNEIL: The Justice Department announced a new plan to fight drug abuse among teenagers. It will cover 20,000 high schools across the nation to target teenage athletes and their coaches. Attorney General William French Smith said the department would spend $5 million on an education program aimed at reaching all students. "Athletes are among the most respected individuals on our campuses," he said. He told the National High School Coaches Association in Lexington, Kentucky, that high school athletes can provide the leadership needed to create a strong peer pressure against drug use. He said, "They can help to cut the demands in our society for illicit drugs." College Football: Court Sacks NCAA

MacNEIL: The Supreme Court ruled today that the long-standing arrangements for televising college football are illegal. Ruling seven to two, the justices held that the National Collegiate Athletic Association had no right to exclusive control of the rights to televise college football games, the control it has wielded for 32 years. The Supreme Court agreed with lower courts that the NCAA had violated anti-monopoly laws in selling exclusive rights to ABC, CBS and the Turner Broadcasting System. The justices said the NCAA had stifled competition among hundreds of colleges for television time by setting limits for the number of telecasts per season and the number of times a school could appear. The ruling upheld the complaint by two big-time football universities, Oklahoma and Georgia. In 1981 they took the NCAA to court claiming that the Association's TV contract was a group boycott and a price-fixing scheme. At issue are hundreds of millions of dollars in revenue for television and millions for college athletic programs. To explore the meaning of the ruling further, we have Jack Craig, sportswriter with The Boston Globe. He joins us from public station WGBH in Boston.

Mr. Craig, with so many interested parties -- big colleges, small colleges, TV networks, local TV stations and the fans, finally -- who wins and who loses in general on this today?

JACK CRAIG: Well, eventually there may be no winners, strangely enough. The Universities of Georgia and Oklahoma, which really were motivated by greed, the desire to accumulate more money for themselves rather than redistribute it among the smaller schools, they might find themselves with a smaller pie even though they'll be cutting it up among fewer people.

MacNEIL: Why would that be? Why would they find themselves with a smaller pie?

Mr. CRAIG: Well, CBS and ABC have a very bad contract with the NCAA now.They're scheduled to pay them $68 million this fall, and if the ratings tumble -- they anticipate an 11 rating; they got a nine rating, which meant it was bad for their advertising; I think they're going down further. So while the NCAA -- while the colleges broke free of the NCAA, the networks broke free also of their existing contract, and now they're going to say, "Okay, fellas, this is a new deal. What do we work out?" I have reason to suspect that the $68-million contract may be as little as $50 million.

MacNEIL:Because college football just hasn't been as popular on television?

Mr. CRAIG: That's right. It's part of the trend of all sports on television. And I mean all sports declining. The NCAA is one of the ones who have tumbled worst of all. Now, also it's because there's going to be a lot of chaos, there's a lot of shaking down that's going to take place. Now, when I say there may not be any winners, I guess I'm talking long range.

MacNEIL: Let me go back to Georgia and Oklahoma for a moment and big universities, very big ones like Notre Dame. Don't they stand to benefit because they could get as many games on television as the traffic will bear, whereas under the previous -- the existing arrangement, they were restricted in the number of TV appearances?

Mr. CRAIG: Well, Notre Dame stands aloft. We have to put them in a special category. They were so powerful in the early '50s that the NCAA control was established in the first place in order to restrain them. Otherwise, they'd go into every major television area and completely dominate. But the University of Oklahoma, for example, put out for bid on a contingency basis in the state of Oklahoma, seven or eight games that they felt would not be on network. The highest bid they got was about $1.2 million. That's just two network games.

MacNEIL: That's small?

Mr. CRAIG: That's very small. I mean, any time you get an area, you know, to use the phrase, where there were more cows than people, you may have a very powerful football team, but you're not going to draw the bodies to the TV set that the sponsors require. If 95% of the people in Omaha are watching the Nebraska Cornhuskers, that is not as good as if 10% of the people in New York are watching NYU. I mean, after all, the bottom line on all this is to generate advertising money.

MacNEIL: What's going to happen to -- you mentioned it a moment ago, that under the present system the revenues the colleges got was shared out among smaller colleges to help in their athletic programs. What's going to happen to that?

Mr. CRAIG: Well, they will not get any money. But the most schools that are in peril are the real Division 2 and 3 schools, the real small schools that depend upon two or three or four thousand folks to show up every week to provide some money at the gate and some enthusiasm. If you have a flurry of games at all levels on television, we know that those schools that have a marginal attendance are simply going to slip over the edge. And I think that this is the ringingly negative element in the court's ruling, although in dealing with antitrust per se, I guess the court was not going to worry about the impact down the road to other schools.

MacNEIL: Someone I was talking to compared this to airline deregulation, this ruling today. Do you see any resemblance to something like that?

Mr. CRAIG: Well, I'll tell you. The word "chaotic" is used loosely in our business, but in this case it really does apply. There are so many potential syndicators and hustlers out there who are trying to line up a network of stations that bring schools on board. I had a fellow at a Boston station tell me today that a syndicator, who actually happened to be Jewish fellow and he happened to make a trip to the Vatican with the Notre Dame club trying to get some inside track to get the Notre Dame football schedule. Notre Dame --

MacNEIL: That's really going to the top.

Mr. CRAIG: Yeah. Notre Dame, after all, if they were to come into New York or Washington or Boston eight or nine Saturdays a year, common sense tells us that it would dominate the audience, dominate the advertising. They simply would scatter the rest of the competitors, and also they would have a tremendous recruiting tool because kids wanted to appear on television so it would have a snowball effect.

MacNEIL: Can I just stop you there? You mean, colleges recruiting players, the players who are considering different colleges, ask them how much they'll get on television? Is that right?

Mr. CRAIG: They are told, the top high school players are told -- they get calls from Nebraska and Oklahoma and other schools saying, "Wer're on such and such a station this week, and why don't you tune in if you can?" They've grown up in the era of television. They see it all, and it's quite electrifying to them, the medium. And, yes, the opportunity to appear on television is a genuine recruiting tool. We're talking about young, impressionable athletes. And most of them are not that interested in the libraries at the universities.

MacNEIL: Of course, if they appear on television it would enhance any future professional prospects, too?

Mr. CRAIG: Not necessarily, because the pros know how to look around.

MacNEIL: I see.

Mr. CRAIG: But I do think that the recruiting advantages of television is another very important element here that can't be measured in a tangible way, but if you talk to assistant coaches going around the country, it's very real.

MacNEIL: Let's come, finally, back to the fans. Can you guess now how different it's going to be for fans on Saturday afternoon, what kind of different games they're going to see, whether it will be different for you sitting in Boston watching than for someone in Oklahoma City?

Mr. CRAIG: Well, the fans are the winners in the general sense because their philosophy is the more the merrier, at least short term. The one thing, the one qualifier I have to put in here is that you only can have this free games on television when the networks are not on. They call it window of availability. Now there can be a local game either on early or late Saturday afternoon or Saturday night. The fans will get, in major markets -- in Boston, for instance, Penn State and Boston College are definitely planning coming independently. Notre Dame, if they're around, will come in independently. If Oklahoma can set up a regional network, Boston being the sixth [unintelligible] it would come in independently. The people who live in major markets are going to see an enormous increase of college football on television. And I have to add one other qualifier in here. The CFA, which is the group that's the new group succeeding the NCAA, are going to meet in Chicago tomorrow and Friday --

MacNEIL: That's the College Football Association.

Mr. CRAIG: Right. And they may actually try to introduce new disciplines against this type of thing, the very thing they complained about before. Now, they would say, ah, but this is voluntary. If you don't want to participate, you don't have to. But we know in the real world pressure exists so the people who were looking to obtain freedom are now ready to go out and impose certain rules of their own. If that sounds like the world of politics, it's pretty close.

MacNEIL: Mr. Craig, thank you very much for joining us from Boston.Jim?

LEHRER: Still to come tonight, our documentary look at why the effort to create a synthetic fuel industry hasn't worked, and a review of Intimate Memoirs by Inspector Maigret's creator, Georges Simenon.

[Video postcard -- Sedona, Arizona]

MacNEIL: A bill to increase taxes and reduce spending by a total of $63 billion was passed by the House today in response to President Reagan's request for a down payment to reduce the federal deficit. The bill would increase liquor taxes by about 20%, close some loopholes for corporations and continue the 3% tax on long-distance telephone calls. The House voted for it by 268 to 155 and sent it to the Senate. Jim? The Trouble with Synfuels

LEHRER: A House committee hearing on the problems of the synthetic fuels corporation opened with a bang this afternoon, with the chairman of the committee calling for the resignation of the chairman of the corporation, one of the federal government's most troubled creations. We'll have some of that hearing in a few minutes, but first special correspondent June Massell details what went wrong and why, beginning with the corporation's birth as a child of crisis.

JUNE MASSELL [voice-over]: Remember 1979 when the price of gasoline skyrocketed above a dollar a gallon for the first time in America's history?And, as if that weren't enough, long waits accompanied the high prices. Gas lines curved around the blocks, sometimes extending for miles, a path that originated here in the Persian Gulf. The Ayatollah Khomeini had seized control of Iran and thrown the world's oil supply into chaos and America into panic. Jimmy Carter, his presidency already in trouble, came up with a plan of attack, a wartime-style energy policy to make America energy independent.

JIMMY CARTER [July 15, 1979]: To give us energy security I am asking for the most massive peacetime commitment of funds and resources in our nation's history to develop America's own alternative sources of fuel from coal, from oil shale, from plant products for gasohol, from unconventional gas, from the sun.

MASSELL [voice-over]: A year later, President Carter signed the Energy Security Act, which gave birth to the Synthetic Fuels Corporation, SFC, a federally funded institution with a $15-billion budget and a mission to encourage and subsidize private industry to develop synthetic fuels on a commercial scale. Carter's top domestic policy advisor said the program was supposed to be a kind of national insurance policy.

STUART EIZENSTAT, former Carter aide: We felt that as a matter of national security we could not remain as dependent as we were on uncertain sources of foreign oil from the Persian Gulf and from other unstable regions.

MASSELL [voice-over]: But some critics, like Congressman Howard Wolpe, argued against it, calling it Mission Impossible, an ill-conceived idea from the very start.

Rep. HOWARD WOLPE, (D) Michigan: I think the Synfuels Corporation is probably the single most outrageous example of wasteful spending in the entire federal budget. The corporation was created in the midst of the energy crisis a few years back when there was a desire to do something, anything, and it wasn't thought through very carefully. The concept that we can -- we ought to be subsidizing the commercial production of synthetic fuel, even before we have the technology developed to produce that in a cost-effective way, I think was ill-conceived.

MASSELL [voice-over]: Robert Roach is an environmental lobbyist and a synfuels expert.

ROBERT ROACH, Environmental Policy Institute: The idea was to create a super agency, a New Deal-type agency or a wartime mobilization agency to bring in the cream of the crop of the private sector. Leave them unfettered from the various controls that seemed to bog down other bureaucracies and, if you leave them alone and give them enough money, they'll spend their way to success. And, clearly, we've seen that that approach just does not work.

MASSELL [voice-over]: The original goal, to produce half a million barrels a day of synthetic fuels by 1987, won't be met. In fact, the Synfuels Corporation isn't even coming close. After four years, SFC has signed contracts for only two projects, this coal gasification plant in California, which has just started operating, and another coal gasification project in Louisiana which has not yet begun construction. Even the creators of the program are disappointed with the results.

[interviewing] In retrospect, now looking at this, how do you think it's been going?

Mr. EIZENSTAT: Well, I'm really very discouraged because here we created in 1979, at a time when we had a disruption in oil supplies in the Persian Gulf, here we are, 4 1/2, five years later, talking today when we have yet another threat of disruption in the Persian Gulf because of the Iran-Iraq war, and yet, instead of moving this program forward over the past five years, we've gone backward.

MASSELL [voice-over]: What went wrong with synthetic fuel production? Why did an idea that was once viewed as crucial yield so little? Two reasons have been cited. Management problems at the corporation, and world changes in the supply and price of oil. The crisis atmosphere of 1979 is gone. There is no longer an oil shortage. New sources have been found, and today the United States imports less than 3% of its oil from the Persian Gulf.

DONALD HODEL, Energy Secretary: I think if there's a fundamental problem today with the Synthetic Fuels corporation it is that it does not have a clear mission. It had a mission when it was created, but that mission was within the context of a different set of facts than have in fact occurred. There have been changes, vast changes from what we thought would happen even a few short years ago.

MASSELL [voice-over]: The other big change was price. During the panic of 1979, some government studies projected oil at $90 a barrel by 1990. So the idea was to produce oil domestically, both synthetically and cheaper. But since then the price has gone down, not up.Today's price is only $30 a barrel, a far cry from the projected $90, Not only that, but the cost of synthetic fuel is $60 or $70 a barrel, at least twice the market price. The program provides for price supports. That means the government makes up the difference. At today's price, the government would have to pay private industry $30 for every barrel of synthetic fuel produced. Critics charge that's too expensive.

Rep. WOLPE: That is clearly a silly investment, and it is the taxpayer that is being asked to assume virtually the entire risk and the entire cost of that kind of enterprise.

MASSELL [voice-over]: Proponents of SFC claim that criticism is short-sighted.

Rep. JIM WRIGHT, (D) Texas: Because it's only true large-scale commercialization that you get a competitive price. And as we are able to perfect the techniques and take advantage of the large-scale productions, we will find that in years to come, if we have had the determination to stick it out, we'll be producing it at less than the world price.

MASSELL [voice-over]: Congressman Jim Wright is the House Majority Leader. He believes the country needs to take a long-range view and not be sidetracked by temporary abundance.

Rep. WRIGHT: No, there'll be another oil shortage. Don't doubt that for one minute. You see what's happening today in the Persian Gulf. There will be another oil shortage, and the question is, are we going to sit back fat, dumb and happy, as we did between the '73 and '79 crisis, thinking that our problems were all over?

MASSELL [voice-over]: Although some opponents advocate doing away with the SFC entirely, hardly anyone argues for abolishing synthetic fuel development. The debate, says lobbyist Roach, is over how much development and how fast.

Mr. ROACH: Synthetic fuels are a source of alternative supply that need to be explored. Their potential needs to be explored. The question is over the scope and scale of the program. That is, do we pump billions of dollars into rapid commercialization, or do we accent fundamental research and development, and I think that's where the issue is drawn at this point.

MASSELL [voice-over]: Senator Howard Metzenbaum is one of a growing group taking a middle of the road position. Let's develop the technology and some small plants, he says, but no large-scale industries.

Sen. HOWARD METZENBAUM, (D) Ohio: Well, I would say we need research and development and small-scale commercialization so we don't waste the money. And once we see that it's working, and we bring in the shale oil out of the ground or out of the tar sands, or we're gasifying the coal or liquifying the coal, then we can expand on the size of the budget.

MASSELL [voice-over]: Original porponents find that approach too risky.

Mr. EIZENSTAT: The answer is that the lead time in developing these plants is so long that if a crisis occurs, you can't just turn the spigot on and expect to get synthetic fuels. It takes five to seven years to design and construct these. They are very large, very technically complex projects. You have to start now.

MASSELL [voice-over]: The policy debate has been complicated by charges of bad management, of incompetence, inexperience, cronyism and conflicts of interest, charges that have plagued the corporation for the last year.

Mr. ROACH: I'd say $50 billion has been entrusted to the incompetent to achieve the impossible. And the results of the program to date sort of reflect that characterization.

MASSELL [voice-over]: Some blame President Reagan. Although SFC was Jimmy Carter's idea, the board of directors was appointed by Ronald Reagan in 1981.

Mr. ROACH: Well, I think the administration has never believed in the program.I think they have appointed people to run the Synthetic Fuel Corporation and to serve on its board who did not have the expertise or commitment to the program, and the leadership that was essential from the administration and from the people that they appointed to the Synthetic Fuels Corporation has been sadly wanting.

MASSELL [voice-over]: As criticism began to mount, various congressional committees began to investigate. A Senate subcommittee on government oversight concluded that the corporation had "a troubled past marked by management failures and absence of planning and continuity and slow decision-making." In addition, the subcommittee found that SFC chairman Ed Noble ran it like a family business. Echoing charges of cronyism made by some former SFC officials, Larry Ruff, a former acting director of planning, says the most important thing to Noble was loyalty.

LARRY RUFF, former SFC official: It was a very closed club. Mr. Noble brought with him his project man; he brought his banker on the board; he tried to bring his personal attorney down to be general counsel, but that man didn't stay. He brought in the kind of people that he was comfortable with -- in fact, the very people he was comfortable with. They had experience in real estate development in the South. They had no experience with the kind of large-scale industrial, corporate project that was necessary to develop synthetic fuel.

MASSELL [voice-over]: Charges of cronyism and incompetence were just the beginning. Then came the suggestions of conflict of interest on the part of some board members, a problem that some critics say dates back to how the corporation was set up.

Rep. WOLPE: The corporation was established in a way that made it exempt from all of the normal public interest protections. And it was thought that the only way to insulate the corporation to attract top-level industry personnel to run it would be to make it exempt from the normal salary restrictions, conflict-of-interest laws and so on.

MASSELL [voice-over]: No one has been charged with violating any law, but the allegations have raised ethical questions for many members of Congress.

Rep. WOLPE: We now have a situation where the scandal and the incompetence have produce so many resignations on the board of directors that you don't even have a working forum to conduct business.

MASSELL [voice-over]: Of the seven original members of the board of directors, five have resigned since January, some under a cloud. Since four members are required to approve new projects, the corporation has been left at a standstill. Victor Thompson had been Noble's banker. While on the SFC board, he tried to bail out his troubled bank by offering stock to an individual whose company was competing for synfuel subsidies. Charges of impropriety led to his resignation and an investigation by the Justice Department, which is currently underway. John Carter, a board member and a vice president of a private oil company. According to the newspaper Newsday, he allegedly received help from Texaco to avert a hostile takeover of his company at the same time that Carter voted to grant federal subsidies to a project Texaco was involved with. Carter denied any wrongdoing, but resigned in May. Howard Wilkins resigned shortly after a congressional committee questioned his role as a fundraiser for the Reagan-Bush re-election campaign while he was still on the SFC board. Milton Masson was criticized by a Senate subcommittee for his "insensitivity to ethical considerations." He admitted to having discussed trading a vote on board business for a personal business favor.He too became a regional director for the Reagan re-election team and resigned from the SFC to avoid any appearance of conflict of interest. Robert Monks resigned last January, the most outspoken member of the board, frequently at odds with the chairman and the majority over what Monks called a lack of strategic planning and poor management. He was the only board member not to have any allegations thrown his way.

[interviewing] You describe it as an awful place to work. Why?

ROBERT MONKS, former SFC board member: I think you'd have to think of it in terms of sickness and health. I think you would have to think of it as being quite a sick place where values were inverted, where the best elements of people were not encouraged, were discouraged. I can just summarize by saying I've run for office a couple of times, I've run a number of companies. I've been insulted by experts. But this was the most painful experience of my life.

MASSELL [voice-over]: That leaves two remaining board members. Victor Schrader, an old business associate ofNoble's stepped down as SFC president last year after a Senate subcommittee questioned his use of $19,000 of SFC money to pay real estate fees on his Virginia home. Schrader subsequently returned the money. The other remaining board member is Ed Noble himself, chairman of the SFC and an Oklahoma oil executive. He was under fire for not having placed private stock holdings in a blind trust as he originally promised Congress he would do. He says he recently took care of that.Again, no board member has been charged with criminal conduct, but to some on Capitol Hill, that's not the point.

Rep. WOLPE: I think the important point is that when you have those kinds of relationships, potential conflicts of interest if not actual conflicts of interest, you have the appearance of impropriety. You've created an institution that simply cannot command public confidence.

MASSELL: We tried to talk to Chairman Noble, but he refused. We had an interview scheduled here at his office, but two hours beforehand, an assistant called and said, "We've been doing some checking, and based on what we know that you've been talking to other people about and the kinds of questions you've been asking, we've decided to cancel the interview."

[voice-over] Noble has defended both his board and his corporation before various congressional committees.

EDWARD NOBLE, SFC chairman: Our program is neither massive nor a wasteful investment of federal dollars. Today the corporation is about two-thirds of the way to completing a very sound, successful projects program which will fully satisfy the diversity in energy security objectives of the Energy Security Act.

MASSELL [voice-over]: But the Reagan administration does not share Noble's enthusiasm. The President has asked Congress to cut $9 billion out of the SFC budget.

Sec. HODEL: It's very difficult to justify spending $15 billion to produce oil at $60 a barrel.

MASSELL [voice-over]: And the administration has refused to name anyone to the SFC board until Congress decides what to do with the program.

Sec. HODEL: I do not think that names should be submitted until there is a consensus within the Congress, because today if we send names up here, the people will be absolutely torn to shreds by the competing points of view over what a synthetic fuels corporation should be.

MASSELL [voice-over]: While the administration throws the future of synfuels into the lap of Congress, Congress throws it back to the President.

Rep. WRIGHT: We have lured private people all over this country to spend literally hundreds of millions, truly billions, of dollars of their money getting ready to produce. And then he just lets it fold up and die. It's a terrible tragedy. It's sad.

MASSELL [voice-over]: And as the debate goes on, time runs out.

[interviewing] Do you think any of this will get resolved before November?

Mr. EIZENSTAT: My guess is that it will not because, as we get closer and closer to the presidential and senatorial and congressional elections, the issue becomes more and more politicized. I don't think there will be enough time to resolve it, to nominate more new board members and to have them confirmed and in place before the election.

LEHRER: And that report, by special correspondent June Massell, brings us up to this afternoon, to a hearing of the House Energy and Commerce Subcommittee. The witness was Ed Noble, chairman of the Synthetic Fuel Corporation; presiding was Congressman John Dingel, Democrat of Michigan, who has called for Noble's resignation.Here's how it went.

Rep. JOHN DINGEL, (D) Michigan: Congress gave the corporation a mission. The Congress wants to see that mission carred out. The chair observes that the Congress gave the corporation a large sum of money belonging to the taxpayers. The corporation was to perform a public duty by reducing the nation's dependence on foreign oil. One must inquire whether we have reduced the dependence of the nation on foreign oil or simply afforded a high standard of living to employees of the corporation. Regrettably now, with the mission apparently abandoned, we have to question how and why this public duty was converted into private relief projects for a select few.

Mr. NOBLE: I have absolutely no doubt that had the corporation shunned caution and moved aggressively to award assistance in our first year, that I would also be facing congressional hearings at this time. But not about management. Rather, I subnit those hearings would likely be addressing questions of massive cost overruns, sponsor requests for additional assistance and threatened or actual project abandonments. Our management, while certainly not without flaws, has operated at approximately 30% of the congressionally authorized administrative budget and has worked effectively with the private sector to develop a diverse set of pioneer plants during a period of negative economics for synthetic fuels. No time has been lost for the good projects. We have worked diligently with sponsors who have determined the pace of the project development process. The corporation marks a new concept in public-private sector cooperation in the national interest. I am well aware that many in Congress on both sides of the aisle disagreed in principle with this approach.My job was not to question the concept but to implement it. I have attempted to do this in a responsible and prudent manner. Reflecting on the experience for the past three years, I would say that government institutions have accountability significantly different from private business.

LEHRER: Today's hearing was to last only one day, but Congressman Dingel said he now wants to hear more from Noble and others after the July 4th recess. Robin? Book Review: Intimate Memoirs

MacNEIL: Finally tonight we have a book review. The book is called Intimate Memoirs and it's an autobiography by the French mystery story writer Georges Simenon, creator of one of the most famous detectives in fiction, Inspector Maigret. Our reviewer is Richard Locke.

First, Richard, for readers who may not know him, tell us a little about Georges Simenon.

RICHARD LOCKE: Georges Simenon is now 81 years old, and he is probably most important as the great example of the European realistic mystery story writer.But he's also, in addition to creating the great series of novels involving Inspector Maigret of the Paris police, also a very distinguished novelist who deals in stories of psychological suspense. He's probably most celebrated throughout the world for his phenomenal productivity. He's written 220 novels ever since his career began in the 1920s. And he's very, very highly esteemed by professional critics as well as by an international group of readers because of the absolute clarity and purity of his style and the kind of complete sort of gritty intensity of so much of his own psychology.In all these books, both the mystery stories, which were written primarily for character and atmosphere, and the psychological novels as well.

MacNEIL: Now, Intimate Memoirs is something very different.

Mr. LOCKE: Indeed.

MacNEIL: The theme is --

Mr. LOCKE: The theme that really arises from the disaster that took place when he was about 77 years old, which is to say that his 25-year-old daughter, Marie-Jo, committed suicide in Paris. He loved her very deeply. He was always a man who felt very strongly about his four children, and she was clearly the one that he felt the most intense identification with. And it was out of the mourning process, out of the desire to come to terms with what could possibly account for her disastrous killing of herself led him to write this book. And instead of writing it like his 220 other books, in a matter of days or, at the most, three weeks, he spent well over a year at it, and as -- of course as an aged man. The result of this is the account really not so much simply of her life, but also of his entire life. Because it plunged him back into a reminiscence about his emergence as a writer in the 1920s, his first and second marriage and the personal disasters that he believes lie behind her own unhappiness.

MacNEIL: A man I know who read this book said, who has admired Simenon for many years as a writer, says that the man himself emerges as a monster.

Mr. LOCKE: He's a man who seems to be resolutely separated from his own self-knowledge. I mentioned before his books are full of character and atmosphere. This book is 800 pages long. It has got an enormous amount of material, and yet it never has that inward quality that you expect from Simenon. It doesn't either have the sensuous detail of life, and it doesn't have that profound sympathy and detailed inwardness with another person's feelings. He goes through the complete rehearsal of his own life. He's had a very elaborate and rather eccentric sexual life, which he is very frank about, but there's a sort of antiseptic quality to it all. He speaks about his compulsive need for making love to various women in the course of one day. They're prostitutes or strippers or showgirls. There's never an extended liaison. He brings people into the house. A mistress is installed, in one case, for 20 years before his wife hears about it.Another mistress is employed as a secretary. He never connects this sort of toting up of a record of amorous conquest in a kind of Casanova way with the effect that this might have had on his beloved daughter, whom he did, of course, love. She was insatiable in her own needs for his affection. Her mother was very violent, very volatile, very alcoholic, apparently, and was repeatedly committed to an insane asylum. The daughter clearly couldn't turn to her for nurture. So she turned to her idolized daddy. Now, Simenon himself registers this, but he doesn't feel that sympathy that would lead us to connect his own actions as a man in a very eccentric family with a very peculiar relationship to love and sexual expression and that of his daughter, who unfortunately, at the age of, I think, eight years old, demanded a wedding ring from him. Her chief memory throughout all her life was that he danced with her when she was seven years old. She repeatedly challenged the various mistresses that were coming and going in the chateaus that he lived in and said to him again and again, "What do they do that I can't do for you?" And yet this man who is so wise about other people's self-doubts and confusions and contradictions never brings that depth of self-knowledge to bear. And for all of his sorrow, what you get is the facts, not the character and not really the atmosphere.

MacNEIL: So how would you sum up Intimate Memoirs?

Mr. LOCKE: As a very unfortunate sort of dossier or casebook. And one would be tempted to say that what you really need is an interpretive figure like a Maigret to make sense of it.I think readers will be interested in the sheer herculean effort of the book. It's clearly a labor of love and self-justification, but it's also an enormously depressing book to read and fatiguing to read in its length at 800 pages because it's a spectacle of a man who seems, unlike the characters that he creates, never to have lived below the surface, merely to register the surface, and not really connect his own actions and his own needs with the responsibilities that he was at the same time feeling in the more conscious part of his mind. It's a sad case of self-alienation in a way, or of a writer who knows his characters far, far better than he seems to know himself.

MacNEIL: Richard Locke, thank you.

Once again, the book we were discussing was Georges Simenon's Intimate Memoirs, published by Harcourt Brace Jovanovich.

Jim?

LEHRER: Again, the major news stories today. Jesse Jackson is returning from a visit with Fidel Castro with 22 Americans who have been held in Cuban jails. The U.S. Supreme Court threw out the NCAA's monopoly on televising college football games, and NASA announced space shuttle Discovery will remain grounded at least until the middle of July.

Good night, Robin.

MacNEIL: Good night, Jim. That's the NewsHour tonight. We'll be back tomorrow. I'm Robert MacNeil. Good night.