The NewsHour with Jim Lehrer

MR. LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight, the deal to reopen government. Kwame Holman has a report. White House official Laura Tyson and House Budget Chairman John Kasich explain the deal. Mark Shields and Paul Gigot then analyze it. The defeat of Lech Walesa, Cold War hero. Charlayne Hunter- Gault talks to a polling expert. And the Bosnia peace talks. Elizabeth Farnsworth gets an update from James Graff of "Time Magazine." It all follows our summary of the news this Monday.NEWS SUMMARY

MR. LEHRER: The U.S. Government reopened for business today. The President and Republican leaders of Congress made a deal last night that returned 800,000 furloughed federal employees to work. The deal committed President Clinton to balancing the budget in seven years, Republicans to protecting Medicare, Medicaid, and welfare, among other things. It is a temporary agreement which funds operations through December 15th. The Senate cleared the bill last night. The House passed it this evening. The President has promised to sign it. Earlier today, Republicans claimed victory in the budget duel. Sen. Robert Dole spoke on a satellite hookup to the Republican governors' meeting in New Hampshire.

SEN. ROBERT DOLE, Majority Leader: Let me indicate, as I think you all know, we didn't blink, we didn't compromise on the principle of the seven-year balanced budget during our negotiations. We're not going to compromise on that principle in the weeks ahead. We gave America something truly to be thankful for this week, and come December, we plan to give America a big, big, truly historic Christmas present.

MR. LEHRER: White House Press Secretary Mike McCurry saw it differently. He said President Clinton could accept the deal because it acknowledges the importance of Medicaid, Medicare, education, and the environment.

MIKE McCURRY, White House Press Secretary: It gave the Democrats and the President something we've been looking for, an acknowledgement by this Republican Congress for the first time, and that those priorities the President keeps laying before them are, indeed, important, will have to be reflected in a balanced budget agreement.

MR. LEHRER: Negotiations on the final balanced budget package are to begin in Congress next week. We'll have more on all of this right after the News Summary. Nancy Kassebaum will not run for reelection to the U.S. Senate next year. The Kansas Republican said today she wants to spend more time with her grandchildren, among other things. She was first elected in 1978. One of her major marks was as one of the first members of Congress to work against apartheid in South Africa. Her father was Alf Landon, a governor of Kansas and the 1936 Republican nominee for President. The deadline for ending the Bosnian peace talks slipped by today with no word on progress. Sec. of State Christopher met through last night and all through the day in Dayton with Bosnian, Croatian, and Serb leaders, and other members of the negotiating team. U.S. State Department Spokesman Nicholas Burns said the talks could go either way. We'll have more on this story later in the program as well. Lech Walesa was defeated yesterday for reelection as president of Poland. We have a report from Jonathan Munro of Independent Television News.

JONATHAN MUNRO, ITN: His smile was weak even when the early results put him ahead. Lech Walesa shook his head. He knew his days of leadership were over. In the melee, the man who ousted him, Aleksander Kwasniewski, a former Communist minister who now describes himself as a social democrat. In his camp, jubilation, but at Walesa's headquarters, despair. They believe that without Walesa there would never have been democratic elections. Almost singlehandedly, he'd driven the people against dictatorship in the early 80's, a tide which was later to flow throughout Eastern Europe long after Walesa, himself, had signed the agreement ending the workers' uprising in Gdansk. In the last few minutes, he has conceded electoral defeat. "I will be back," he said. But to friends and foes alike, today has marked the end of a decisive era in Polish history.

MR. LEHRER: And we'll have more on this story later in the program too. The Israeli government has taken action to curb politically-motivated violence. Subversive groups will be disbanded. Jewish radicals will be prevented from entering Israel. The decision yesterday follows the assassination of Prime Minister Rabin by a Jewish extremist two weeks ago. Police have said they believe the killing is part of a right-wing conspiracy, but the confessed killer said again today in a Tel Aviv court he acted alone. The space shuttle "Atlantis" returned to Earth at Cape Canaveral, Florida, today. The touchdown marked the end of a successful eight-day mission to dock with the Russian space station Mir. Mission Control congratulated the five astronauts in Russian and English.

MISSION CONTROL SPOKESMAN: Great job.

MR. LEHRER: Three Islamic preachers have been detained in the bombing of the Egyptian embassy in Islamabad, Pakistan. Fifteen people were killed in the blast yesterday, more than sixty injured. The preachers are from Egypt. They were in Pakistan for religious meetings. Three Islamic fundamentalist groups have claimed responsibility for the bombing. An Olympic Gold Medal figure skater died today. Sergei Grinkov suffered a heart attack while lifting his wife and skating partner during a practice at Lake Placid, New York. This footage was taken last Thursday. Grinkov and his wife won the Olympic Pairs Gold Medals in 1888 and '94. He was 28 years old. And that's it for the News Summary tonight. Now it's on to the deal that reopened Washington, Shields & Gigot, the defeat of Lech Walesa, and the Bosnia peace talks. FOCUS - BALANCING ACT

MR. LEHRER: There was peace and normality in Washington today, because the Republican Congress and the President made a deal. Our focus coverage begins with this report by Kwame Holman.

KWAME HOLMAN: Judging by the traffic on the roadways leading into the nation's capital this morning, most of the area's 150,000 furloughed federal workers got the word. They were expected back at work today, thanks to an agreement reached last evening between the President and the Congress. It temporarily funds the government through December 15th, ending the six-day partial shutdown, and promises paychecks to furloughed workers. Interior Secretary Bruce Babbitt personally welcomed back his employees. SEC. BRUCE BABBITT: I'm delighted to have you back.

MR. HOLMAN: The agreement was the result of weekend negotiations between Republican Congressional leaders and Congressional Democrats and White House officials, led by Chief of Staff Leon Panetta. President Clinton announced the end of the impasse last night.

PRESIDENT CLINTON: The bill I have agreed to sign will allow our government to once again begin to serve the American people, while broader discussions about how best to balance the budget take place. I have made clear from the beginning my principles in this budget debate. We must balance the budget, but we must do it in a way that is good for our economy and that maintains our values.

MR. HOLMAN: The House of Representatives immediately followed quick action by the Senate and passed the first of two temporary spending bills needed to end the government shutdown, and they did it without the kind of harsh partisan, often personal, attacks that have characterized the budget debate. In fact, they did it with no debate at all.

SPOKESMAN: Mr. Speaker, I'd be happy to yield back the balance of my time if the gentleman will do the same so we can pass this thing and put people back to work.

SPOKESMAN: Mr. Speaker, I look forward to people going back to work, and I yield back the balance of my time.

SPOKESMAN: All those in favor, say aye.

ALL: Aye.

SPOKESMAN: Those opposed, no. [silence] The ayes have it. The motion is agreed to, and without objection, the motion to reconsider is laid on the table.

MR. HOLMAN: As part of the agreement, Republicans got the President to commit to a seven-year balanced budget plan using the economic forecasting of the non-partisan Congressional Budget Office.

REP. NEWT GINGRICH, Speaker of the House: [Last Night] The fact that we now have a commitment by the President, a commitment by the minority leaders that they will work with us to get to a balanced budget in seven years and that it'll be scored in an honest way with honest numbers I think is one of the great historic achievements in modern America.

MR. HOLMAN: For their part, the President and Congressional Democrats got Republicans to agree to protect many of the President's spending priorities.

LEON PANETTA, White House Chief of Staff: [Last Night] The key words in this agreement are that the President and the Congress must agree on an agreement that protects those priorities that we have been fighting for time and time again on Medicare, on Medicaid, on education, on the environment, on working families. And the President has always said that our fundamental goal here is to protect those priorities; if we can achieve it in seven years, fine, if it's eight years, fine, but let us fundamentally protect those priorities.

MR. HOLMAN: If it sounds like Chief of Staff Leon Panetta is fudging a bit between seven and eight years, that's certainly how House Majority Leader Dick Armey took it, and after Panetta repeated the phrase "seven or eight years" this morning, Armey fired off and distributed to the press a letter to Panetta criticizing him for his choice of words. It reads, in part, "Words have meaning, Leon. Seven years is seven years, not seven or eight years." And on the floor of the House today, Appropriations Committee Chairman Bob Livingston said he also understood the commitment was to seven years.

REP. BOB LIVINGSTON, Chairman, House Appropriations: Seven years is not going up. Seven years means seven years. The President committed to seven years, not eight, nine, ten, twelve, anything else. He committed to seven years last night, and we're going to hold him to it.

MR. HOLMAN: But most members of the House chose to speak positively about the agreement, even though the sides are far apart on the details of a balanced budget plan.

REP. SANFORD BISHOP, [D] Georgia: Mr. Speaker, I applaud the agreement finally reached by the President and Republican leaders to end the shutdown and put government back to work again for the American people.

REP. TOM DeLAY, [R] Texas: And I am just absolutely thrilled that for the first time in recent history the President of the United States and the Congress has agreed to balance the budget and balance the budget in seven years.

REP. NANCY PELOSI, [D] California: I'm particularly grateful to President Clinton for holding firm to his commitment to protect Medicare, the environment, and education, and to scale back the tax breaks for the wealthiest people in our country.

MR. HOLMAN: And there was even an apology issues this afternoon for a shoving match that occurred during the height of the emotional budget debate on Saturday.

REP. JAMES MORGAN, [D] Virginia: If this were an athletic ring, a top gun Navy fighter pilot the size of Duke Cunningham would certainly have made for a fair fight, but we're supposed to be engaged in a battle of ideas, demonstrating to the American people and other countries how we settle our differences in a non-violent way. And so Mr. Cunningham deserves an apology from me, and I hereby offer one.

MR. HOLMAN: Early this evening by a nearly unanimous vote, the House approved the bill extending government funding through December 15th. The House will adjourn tonight and return after Thanksgiving to begin what promises to be contentious negotiations over a balanced budget plan. NEWSMAKER

MR. LEHRER: Now to separate interviews with two key players in this. Laura Tyson heads President Clinton's National Economic Council. John Kasich, Republican of Ohio, is chairman of the House Budget Committee. Ms. Tyson is first. Welcome.

LAURA D'ANDREA TYSON, National Economic Adviser: Nice to be here.

MR. LEHRER: Sen. Dole said today that the Republicans did not blink. Did the President blink?

MS. TYSON: No, the President did not blink. I think we should think about it the following way. The President was unwavering in his determination to balance the budget but to balance the budget in a way which is good for the American people and reflects American values. He said throughout this discussion of the past two weeks that he wanted his principles recognized, principles to protect Medicare and Medicaid, to adequately fund education and training, to deal with the protection of our environment and to deal with tax breaks, tax cuts to reward working families. Now, he went into this debate with those principles clearly articulated. His determination was finally recognized by the Republicans, and they recognize in their language not just that we will work with them to try to achieve a budget balance in seven years, but also that that balance that both the President and the Congress will agree that that balance does reflect the President's priorities.

MR. LEHRER: Let's talk about all of this, but let's begin with a seven-year commitment. You saw the tape excerpt now that Leon Panetta says, well, seven or eight, and then you saw the Republican reaction, is it seven, or is it eight, or what does that seven mean to the President?

MS. TYSON: The compromise agreement that we have worked out here has two parts. One part says that there will be an enactment of a balanced budget that will achieve balance in seven years, and, though, and that such a path to balance both the President and the Congress must agree will have adequate funding for the President's priorities. Now, the President said last night he is doubtful that, in fact, we can find a path to balance in seven years which reflects his priorities, but what we wanted here was a good faith full debate before the American people outside of the crisis of con--outside of a crisis situation, which were in last week. We would have that debate, we would look for a way to achieve balance in seven years, reflecting our priorities. If we cannot find that, we will stick with our priorities. Our priorities--remember, we believe that balancing the budget the right way is more important than balancing the budget in some arbitrary number of years.

MR. LEHRER: So the President hasn't really committed to balancing the budget in seven years, period?

MS. TYSON: I think the way this agreement is, is written, it clearly says that nothing is agreed to until everything is agreed to. If we can find with the Congress, working in a good faith, non- crisis atmosphere, a path to balance in seven years which reflects these principles and priorities, incidentally, which we believe reflect the principles and priorities of the American people, the American people do not want massive cuts in Medicare and Medicaid, they don't want to endanger funding on education and training, they don't want to endanger the environment, and they don't want to see taxes increase on working families. They would like to see some tax relief for working families. So if we can find a way to achieve those objectives, which is what the American people want, and get to balance in seven years, then we want to have a good faith negotiation to get that outcome.

MR. LEHRER: So when Panetta said, as he did, oh, it might take eight years, that that's--that that is definitely the President's view on this, right? That--because the President's negotiators are going to come at it from his priorities, rather than from the Republican Congress's priorities.

MS. TYSON: Here's what I would say. We really want this to be a good faith, full discussion. The first thing we had to do was get rid of the crisis atmosphere. The first thing we had to do was get the government back to work, get services back to the American people, important government services back to the American people, and then have the real negotiations. This deal--this agreement that we reached allows us to have the real negotiations. Now, if we cannot find a way to reach balance in seven years and maintain those critically important priorities to our economic future, then, of course, we're going to have to do something else. And ultimately, our view is the budgetary priorities, what we defend and protect and spend on and how we invest in the American people matter more than the number of years. We did our budget work always the same way. We said what is the right set of policies and then we looked for achieving balance within the right set of policies. We concluded in our own work that it looked like it took about ten years or then about nine, because the economy has done better than we thought. Now, we're willing to look with the Republican majority for a path to balance in seven, but we are not willing to compromise our priorities and principles. And that is clear in the wording of that agreement last night.

MR. LEHRER: So it would be a mistake to call it a compromise, wouldn't it? There's been no compromise. This is kind of an agreement to continue to disagree, to try to work out something.

MS. TYSON: I think it's an agreement to continue to discuss in an atmosphere which is not filled with crisis and which allows the American people to have the full debate that they deserve. They deserve to have this debate. We think that they have clearly spoken already in terms of believing that we should protect Medicare and Medicaid, believing that we should invest in education and the environment, and believing that tax cuts to the extent that we have them should really focus on working Americans.

MR. LEHRER: Was it--was it all worth it? Was it worth the government shutdown to get this agreement?

MS. TYSON: You know, we never thought the government shutdown was a good idea. I just want to say that it's clear that at least some members of Congress going back early into April of last year were saying that a shutdown would be used really to force the hands of the President and the administration to accept what the Congress wanted in terms of its own path to balance. What we did here is by having the President show his unwavering determination to our budgetary priorities, we have now achieved a situation in which we're out of crisis and we can begin to have this debate, but not wavering from our principles.

MR. LEHRER: How much did the shutdown cost?

MS. TYSON: Well, you know, it's hard to put a dollar sign on the shutdown. I think more--I think that there was one estimate today that by yesterday at least 20 percent of American households were affected in some way or the other by a shutdown, not being able to get passports, not being able to get into national parks, not being able to process their loans through the Federal Housing Agency, not being able to get student loans, not being able to sign up to be--to essentially join the armed forces. These are all things which the American people suffered from and frankly, as I said, we always thought that we should have these negotiations with a continuing resolution to allow the debate to be heard but not have any situation of crisis which would be manufactured and might force the debate in one way or the other.

MR. LEHRER: Now, the debate to come, the one that--the real debate--the real negotiations, once the final reconciliation package actually gets to the President, the President vetoes it, and then the real negotiations begin. What does this--what does this word--these words about the real economic numbers that matter, whether it's the Congressional Budget Office or the White House numbers, what is your understanding of what that means?

MS. TYSON: Well, look, it says very clearly that in this development of the underlying assumptions, look, I think it should be just clear why you need assumptions in the first place. Before you develop a plan to balance the budget, you have to project deficits going forward and spending going forward. Before you can make those projections, you have to make economic forecasts. So we made a set of economic forecasts using our best--

MR. LEHRER: "We" meaning your office?

MS. TYSON: We, the administration. The administration made its economic forecast. The Congressional Budget Office working for the Congress made its economic forecast. Now, what the wording of this agreement says is essentially it calls for consultation and review of numbers prepared by the non-partisan Congressional Budget Office. So in point of fact, when all is said and done, what this agreement means is that we would have, if there is to be an agreement at the end of this negotiation, it will be a mutually- acceptable agreement, it will both achieve balance in seven years and reflect the President's priorities, which are clearly stated there. The President's priorities must be part of the deal. And then also clearly, since it would be a mutually-acceptable deal, there would be input into the underlying economic assumptions not just from the administration but also from private sector forecasters.

MR. LEHRER: Finally, speaking of private sector economists, a lot of those folks say the whole things is absurd; there's no way to project seven years ahead and guarantee that a budget could be balanced, because you don't know what economic factors could come, what crisis could happen in the country, et cetera, et cetera. They're right about that, are they not?

MS. TYSON: There is always going to be uncertainty in laying out a path to balance over seven years. If you lay it out over seven, rather than five, you increase the amount of uncertainty. That's why I think the policies are so important. That's why I think the priorities are so important. We need to sit down and negotiate the right policies in the area of Medicaid, the right policies in the area of Medicaid, the right polices in the area of education and training, look at the appropriate funding levels which come from the policy analysis and then look at the number of years. I agree completely that since there is going to be uncertainty along this path that we should focus the issue on policies and priorities.

MR. LEHRER: And of course, the President, even if he is reelected, won't even be in office seven years from now, and many of the members of Congress, who voted on the deal, won't be in office either.

MS. TYSON: That is true. That is true. But I do think it is important--I do think we are at an historic moment here, and I do think that that's why this agreement we've reached to have this negotiation is so important. There--the President is committed to balancing the budget, and I think that's recognized in this, in this agreement. The Congress is committed to balancing the budget. It is very important to our economic health to set out a believable, credible strategy for balancing the budget over the long run. So even if we can't get it precisely right, because there's always some uncertainty, getting on the right path and having underlying policies done in a non-crisis atmosphere is going to be very important for our economic health.

MR. LEHRER: Laura Tyson, thank you very much.

MS. TYSON: Thank you, Jim.

MR. LEHRER: Congressman Kasich has been delayed in the House of Representatives by a series of votes. We had planned to go to him in a back-to-back interview at this point. If he is not able to join us later in this program, we'll have him on tomorrow night. FOCUS - POLITICAL WRAP

MR. LEHRER: All right. No, it is not Friday night, but we do go now to Shields and Gigot for some analysis of this budget deal. They were with Margaret Warner.

MS. WARNER: Syndicated columnist Mark Shields is here with me and "Wall Street Journal" columnist Paul Gigot is in Boston tonight. Paul, who got the best of this budget deal politically?

PAUL GIGOT, Wall Street Journal: Well, I think in the short-term both of them are going to benefit, both the President and the Congress, because they eliminated the crisis atmosphere, and they both eliminated the sense of chaos that had prevailed. But I think that if you look at the substance of the agreement and the terms of the debate, this reminds me a lot of the 1990 budget deal in reverse. Remember, in that one, the Democratic Congress and George Mitchell got President Bush before they sat down to the real tough negotiations to agree to something important, tax revenue increases. By giving that up, he had really shifted the terms of debate. I think what you see this time is before the real hard negotiations begin, the Republicans got the President to commit to a seven-year balanced budget, more or less with Congressional Budget Office numbers, and they've shifted the terms of debate. It's created a relatively narrow framework within which the negotiations can occur, and I think that unless the President is willing to blow up the whole thing at the end of this, the Republicans are at least going to prevail on the direction of the debate.

MS. WARNER: Mark, how do you see this politically?

MARK SHIELDS, Syndicated Columnist: Politically. I was just knocked off my pins to think of something in such venal terms. I think Newt Gingrich, the Speaker of the House, may be about to pull off the impossible. This is a man who after all convinced Republicans after forty years in the wilderness and four landslide victories, two by Ronald Reagan, one by Richard Nixon, one by Dwight Eisenhower, they could never win back the House. He convinced them they could. Today for the first time, I think Newt Gingrich may have convinced Democrats they can win back the House. Gingrich has watched his own numbers plummet. Paul's paper this morning showed the numbers, that Gingrich's negative margin had tripled in just four weeks. He has become the face of the Republican Party. It's a real, real problem. He is now less popular as the Speaker of the House than was Richard Nixon on the eve of his resignation from the presidency, so he became the face of the Republican Party. I thought the Republicans did something very smart this weekend; they put John Kasich, the young sort of kid from the block, chairman of the House Budget Committee, out in front, and Pete Domenici. They are far more appealing faces than is Mr. Gingrich. I think there's no question Paul is right; seven year balanced budget. There is no constituency left in Congress or apparently in the White House to fight that. And that's it. But now the fight over the next three weeks, four weeks is going to be, Margaret, over tax cuts versus Medicare cuts, and I think quite frankly that's one where the Democrats have an edge over the Republicans.

MS. WARNER: Okay, Paul. I want you in a minute to talk about how Gingrich looks now, but first, respond if you would to what Laura Tyson just said to Jim and which Panetta handed out, Leon Panetta handed out today, which is as far as the President's concerned, this seven years isn't much of a commitment.

MR. GIGOT: Well, it really makes me wonder whether or not, you know, every day with this President seems to be a new day, and yesterday they agreed to seven years, and today maybe not. So it does make you wonder how committed they are. My feeling is that as they're going to go into negotiations now, nobody's going to shut down the government again in the short-term, but if this happens, as we get towards December 15th, that they disagree on the fundamentals, and the President is walking away from that balanced budget commitment with, as the Republicans say, honest numbers or Congressional Budget Office numbers, I think we could see another shutdown of the government, another crisis situation if they can't come to an agreement. So it makes you wonder what they did really agree to.

MS. WARNER: Well, do you think, Mark, that the White House can afford to walk away from seven years now?

MR. SHIELDS: No, I don't. I mean, I think that's serious business, and I don't think--I'll say this. Both parties lost-- there's no question--by the shutdown, the closedown last week. If they reach a point again where because of one side refusing or being intransigent or refusing to honor what was perceived to be an agreement and we close it down again, let me tell you, people will be calling the Dallas area code to beg Ross Perot to run in their state. I mean, he's going to be the big winner. There's no question about it.

MS. WARNER: Okay, Paul, if, as you believe, by agreeing to this seven-year commitment, whatever it is, the President was redefining the terms of the debate on Republican terms, why did he do it?

MR. GIGOT: I think he did it for a couple of reasons. One is that they were counting heads in the Congress, and a lot of the Democrats on the Hill were finding it very difficult to resist the notion of a seven-year balanced budget. Some of them were even liberals who wanted to get the government back open and were inclined to vote for something that would reopen the government. So there was real danger that they were going to be overridden o a veto. That's one thing. The second thing is I think it's very difficult for a President to preside over chaos. He needs to have something as an incumbent. He needs to have a sense that something is being accomplished, that there's some order, that there's some progress in movement. This is what Republican Presidents found when they were trying to resist Democratic Congresses in the 1980's. It's one thing for President Clinton to stand up as he did and say, I'm willing to stand up for my principles; it's another thing to let a crisis situation go on and on and on. And I think that they saw that the polls were beginning to blame both sides, not just the Congress.

MS. WARNER: Okay, gentlemen, I'm told now Congressman Kasich is here, so we're going to break this off temporarily while Jim talks to Congressman Kasich. We'll be right back. NEWSMAKER

MR. LEHRER: Yes, indeed. Congressman Kasich is a Republican from Ohio, and he's chairman of the House Budget Committee, and he's joined us from Capitol Hill. Congressman, I assume you did not hear what Laura Tyson said.

REP. JOHN KASICH, Chairman, Budget Committee: [Capitol Hill] No, I was on the House floor.

MR. LEHRER: Right. Okay. Well, basically, let's just go through the deal. The question about seven years from--what is your understanding of what that commitment by the President means to seven years?

REP. KASICH: Well, there isn't any understanding on my part, Jim. It's very clear we're going to balance the budget in seven years, and we're going to let the Congressional Budget Office do the arithmetic to make sure that all the numbers add up, and that's the--that's it. That's cut and dried, and if there is but a scintilla of movement on the part of anybody away from seven years, I'm personally out of here and so will the rest of the Republican Conference. That was the deal. It's straight and clear. Now within the box, within the box of the seven years, we can fight and argue and debate about our priorities but it's seven years, it's CBO- scored, and it is flat out written out there and I think it's a wonderful day for our country. That's why I've been so excited. We no longer have balancing the budget as a goal or a dream. It is going to be a reality.

MR. LEHRER: Well, now I'm going to paraphrase what Laura Tyson said here, so bear with me a moment. She said, yes. In fact, those were her final words, that it is historic because the President and the Congress have committed to a balanced budget, but what she also said was remember that the President's priorities are in there as well and that the agreement says if those priorities can be met in balancing the budget in seven years, fine; if not, then it may take a little longer. That was her interpretation. That's what Panetta said as well.

REP. KASICH: No. I think that Leon will not say that again. I think he will agree it's a seven-year deal, and if the President and we can't reach an agreement in terms of creating priorities within the seven-year box, and I mean, that's the way legislation either passes or fails, but if we can't reach agreement within the seven-year box, we're not going to go to seven years in one second. We've got an agreement now on seven years and with CBO doing the scoring, and I just heard the great Mark Shields say there's no way the White House can slip off ofseven years, and he's exactly right, because I think Shields, being a very fair referee, would blow the whistle, and I think there would be incredible howls from across the country that this is a law, the President signed it, the language is clear, and you know, there's a point at which the spin meisters have to take a back seat and let's get on with our work.

MR. LEHRER: Well, speaking with getting on with the work, another thing Ms. Tyson said, you said, CBO figures, she said that there will be input, all kinds of figures to try to arrive at some assumptions that you all, in other words, the Republicans and the President can agree on as far as figuring out what it'll take to balance the budget in seven years, no?

REP. KASICH: Jim, that's not--what we have said is that anybody that has an economic argument, they can take it to the court, called the Congressional Budget Office, the non-partisan operation that the President's Budget Director, Alice Rivlin, used to head. This is an operation that's very frustrating to both parties because they're just like a referee in a football game. They've got the change. They're ten yards, and you can't make the change less than ten yards. But what we're willing to do is we're willing to let the Congressional Budget Office listen to all these people and what they think about the economy. But at the end of the day, the Congressional Budget Office will be the ones that will come up with the bottom line numbers. They cannot be bullied; they cannot be beaten up, and their integrity will not be questioned. You got to have--the President said in '93 we should operate from the same set of books and the same set of numbers. Look, frankly, Jim, this is behind us and Laura Tyson, I don't know where she's coming from on this, but the President has agreed to seven years when he signs this deal. Leon Panetta will say seven years, and if they don't, Jim, then we're out of here, and that's not simply--simply not going to happen. It isn't conceivable to me that the President will sign this and then, and then walk away from it.

MR. LEHRER: Well, let's talk about what you all agreed to with the President, in other words, and Ms. Tyson went through that again as well, and so did Mike McCurry today and so did Leon Panetta, that you all agreed to, to protect Medicare, Medicaid, the environment, et cetera. Now what is--how do you read that commitment the other way--from you to them?

REP. KASICH: Jim, this basically got down to, to language, expressing all of our priorities within the framework of seven years. And as you know, we have said that everything is on the table in these negotiations, as long as the negotiations occur within the parameters of the seven years, which we have agreement for doing. And frankly, in this bill, this balanced budget proposal we'll all be talking about, none of the programs are going to have spending going down. All of the spending is going up. I mean, there's not that much difference. There would be if we were cutting spending, and they were increasing spending. That's not the deal. We're slowing the growth in spending, and what we're going to ask the President to do is to say if you want, if you want spending to grow faster than what we want, how are you going to pay for it, and what are your priorities? I mean, and that's really the bottom line, and it will be from the point of asking him how much more do you want to spend and where do you want to get it from that's going to be the centerpiece of these negotiations.

MR. LEHRER: What about the tax cuts that are in the Republican bill? Aren't they also going to be on the table?

REP. KASICH: Well, everything is on the table. I mean, I can't say one day everything is on the table, then the next day I say, well, really, I was just kidding. I mean, everything is on the table. We will fight passionately for our tax cuts, capital gains cuts, because it's about economic growth. If a business is going bankrupt, I mean, you just can't cut overhead, you got to increase sales. And that's part of the way we want to balance the budget, with economic growth. Family tax relief we think is important, but we're going to debate this out, Jim, and it's going to be a heck of a debate, but at least we're in the ring. We know what the shape of this looks like, and at the end of the day, the news for the American people is we're going to balance the budget and fix this economy.

MR. LEHRER: All right. I don't want to appear to be trying to make trouble here.

REP. KASICH: Go ahead.

MR. LEHRER: No--but the President--in other words, what you're saying is that you Republicans didn't--you didn't change your position at all, in other words, the President committed to seven years that you wanted him to, but you all didn't change a thing? In other words, you have not committed to anything as far as for protecting Medicare, Medicaid, that was new?

REP. KASICH: No, no, no. What we agreed to do is to debate about what the priorities ought to be in this package. But we said from the bottom line there will be a seven-year balanced budget, and the arithmetic will be done by the organization that the President selected in 1993. What we did say is that there'll be nothing off the table, everything will be negotiated, we're interested in hearing what the President's priorities are, but frankly, Jim, there's got to be a bottom line, and that's what I communicated along with Sen. Domenici to Leon Panetta. There is no moving from the integrity of seven years, and that's where we are, and we'll fight within that in terms of what our priorities are.

MR. LEHRER: Was it worth it, Congressman? I mean, was the shutdown and all of the abuse that you and your colleagues received, you and the Congress and the government of the United States received to get this deal?

REP. KASICH: You know, I praised John Lewis, who walked across a bridge and took a vicious beating in the name of civil rights. And if you asked John Lewis today was that beating worth taking, he would tell you, "I'd do it again," and this was not just politics as usual. We were fighting over real principles and real integrity. And at the end of the day, the truthful American--one of the great stories of America is we fight over deeply-held principles, and at the end, we make a deal, and we advance the country. And frankly, we are advancing the country. And the reason I'm so happy is because, Jim, I absolutely believe that this is what's going to lay down the beginning of the end of the fear that this country is going to slide into oblivion and jobs and homes and everything else that would be at risk. I think this is the first big step towards preventing the loss of jobs and giving the young people of this country a chance to fly and realize their dreams. This is a great, great, great day.

MR. LEHRER: But as a practical matter, it wouldn't have happened if, if you all had not been able to shut down--in other words, was it the shutdown of government--I don't mean you all--all right--

REP. KASICH: We would have been back to "read my lips," another Washington gimmick, I mean, a pox on both Houses. We now have the integrity to do this, and had we not made the fight, had we not stood firm and said there are some fundamental principles we have to adhere to and then inside of that we're going to be able to debate our priorities, but had we not stood firm, we wouldn't be here now, because it's been the history of Washington to just don't worry about the next generation, don't worry about paying the bills tomorrow, just get the job done and feel good, and it has to stop.

MR. LEHRER: What about those who have said, quite publicly, that the President also stood firm on what he believed or you all would have rolled over?

REP. KASICH: Jim, this is Thanksgiving, and I think I've made-- the Thanksgiving period--I think I've made it clear, seven years scored by arithmetic done by the Congressional Budget Office, we'll fight our priorities, and at the end of the day, we'll end up with an agreement that'll save the country. And I think that's where we, as you say on that show, I think that's kind of where we have to leave it.

MR. LEHRER: I agree with you, and I'm going to leave you alone. Okay. Thank you very much, Congressman. I'm glad you were able to make it. Now, we're going to go back to Shields and Gigot and let them analyze--you can listen--and have them analyze what you just said.

REP. KASICH: Okay.

MR. LEHRER: Okay. Thank you. Margaret. FOCUS - POLITICAL WRAP

MS. WARNER: All right, Paul. Let me hear from you. What do you think the Republicans gave up, if anything, in agreeing to protect Medicare and Medicaid and embrace the President's priorities, at least in this language?

MR. GIGOT: Well, I think first of all they gave up last week whatever they had attached to the balanced budget language. Remember, last week, they had attached some of their priorities, getting rid of the Commerce Department was debated, there was some environmental language, some regulation language. There was the Medicare premium reform. They gave all that up, and they gave it up last week. On the weekend, I don't think they gave up a lot of, except rhetorically, they gave up the ability to shut down--first of all, they gave up the ability to shut down the government, which was putting pressure, I think, on both sides. But rhetorically, they did give the President some ground on some of his priorities. But when it comes to the hard numbers, they shrank the box within which those priorities can be negotiated.

MS. WARNER: But do you think they agreed--let me go to Mark--do you think the Republicans by embracing that language or agreeing to it did agree to soften their budget package to some degree on environment and education and Medicare and Medicaid?

MR. SHIELDS: I think there's a recognition on the part of many in the leadership of the Republican Party that they had gone too far, that they had been pushed too far, and that perhaps not resisting enough, the most ardent impulses of some of their true believers. And I think that to the degree that they are seen as softening their position on Medicare, on Medicaid, seeing, being seen as more compassionate, less draconian, less severe, less harsh, it helps the Republican Party. I mean, if you look at what they included, working families, farmers, education, Medicare, Medicaid, environment, it was everything but the, you know, but the U.S. Air Force band and the Army Corps of Engineers that's going to be protected. I mean, and welfare as well, so I mean, I think that John Kasich probably puts as positive a face on the Republican message as could be put on it.

MS. WARNER: Okay, Paul, let me ask you this. Pretend you and Mark are the President's advisers, you're Dick Morris and Leon Panetta. After this exercise, what would you be telling him about how he should approach the negotiations, what this last exercise has told them about how the Hill Republicans will play it, and how they should play it in return?

MR. SHIELDS: He's Dick Morris.

MS. WARNER: Okay. You're Dick Morris.

MR. GIGOT: You know him better than I do, Mark. It's, I think, ultimately the bottom line is you have to come to some kind of a deal. You have to be seen to be embracing what the public wants, which is a balanced budget, and I think that you've already signed up to some tax cuts. You're probably going to have to agree to some of those. Your party, the Democratic Party in Congress, doesn't want tax cuts, at least not very much, because it means you have to cut spending more, but you probably have to accommodate them on that. Continue to use the Medicare card, which you have been brilliantly, if rather shrilly at times, to leverage the Republicans, but ultimately what you have to do is you have to come down and cut a deal because that's what is the best--best way to get reelected.

MS. WARNER: Okay. And what would you be telling him?

MR. SHIELDS: I would tell the President, Mr. President, people still have doubts about where you stand. This is the greatest chance you'll ever have between now and November of 1996 to define what is it that you want to be remembered for, what do you want to tell your grandchildren your presidency was all about? Because in this one-month period you can define it. I think Paul's advice on a specific basis was good, but he has to define it. There's no more triangulation. He can't play off against the Democrats in the Congress and the Republicans in the Congress. He is now joined at the hip with the Democrats in the Congress on this fight.

MS. WARNER: Okay. And very briefly, Paul, let's go at it from the other end. If you were advising Gingrich and Dole, or you two were Gingrich and Dole, what did this exercise tell you about the President and the way he's going to approach the upcoming negotiations?

MR. GIGOT: President Clinton is in the same position from the other side of the aisle that George Bush was against the Democrats in 1990. He is not going to be able to preside over another shutdown. He wants to be seen. While he wants to be seen as getting credit for protecting some Democratic priorities like Mark--wants to be joined at the hip with the Democrats, ultimately, he's already agreed in principle to your tax cuts; he's agreed in principle to some of--a good portion of the spending cuts. He's agreed in principle to the Medicare reform. Hold tight. Don't give in too quickly, and you'll prevail, and you'll have a significant change in the direction of the government and of politics in the wake of 1994. You'll be able to say you kept your promises.

MS. WARNER: Real quick, Mark. Would your advice be the same?

MR. SHIELDS: I remind Speaker Gingrich of what he has already observed, and that is that the freshman Republicans, there's a competing pair of imperatives pushing them; one, a balanced budget, and the other, tax cuts. He said inevitably they were going to come into conflict at some point. They're coming into conflict now. And I think the balanced budget is his winning hand, rather than the tax cuts.

MS. WARNER: Great, guys. Thanks. We'll leave it there.

MR. LEHRER: Still to come on the NewsHour tonight, the defeat of Lech Walesa and the Bosnian peace effort. FOCUS - CHANGING TIMES

MR. LEHRER: Britain turned out their hero of World War II, Winston Churchill. Now, Poland has done the same to their hero of the Cold War, Lech Walesa. Charlayne Hunter-Gault has that story.

MS. HUNTER-GAULT: Walesa conceded defeat today but vowed to stay in politics. He was upset in his bid for a second term as president of Poland. In 1980, this shipyard electrician became the focal point for the Solidarity labor organization. A decade later, he was president of Poland at the forefront of a revolution that toppled Communism all through Central and Eastern Europe. For more on Walesa and his legacy, we go now to Bartlomiej Kaminski. He's the director of the Center for Post-Communist Studies at the University of Maryland. Mr. Kaminski, why did Lech Walesa lose this election?

BARTLOMIEJ KAMINSKI, University of Maryland: I think that there are two major reasons why he lost. First of all, he was unable to stay as a political leader able to function in a new environment. Poles strove for political stability, and he was perceived as somebody who generated conflicts, who was unpredictable, and who contributed not only to economic uncertainties but also to political uncertainties. The second reason is that there is--

MS. HUNTER-GAULT: So it was a personal--there were a lot of personal reasons.

MR. KAMINSKI: That's right. And he, he was very irresponsible in a sense in sort of selecting some people to various posts; he would alienate his old friends from Solidarity, and he was unable to create a solid political base in the 1990's. The second reason I think has more to do with a very brilliant campaign conducted by Kwasniewski, who is young, articulate, and who really made impression on many people. I remember hearing people saying that from the post Solidarity camp, saying it is a pity he is not on our side, that he has this record of being a Communist minister in the last Communist government in Poland.

MS. HUNTER-GAULT: But it was more--are you saying, though, that it was more Walesa's personal problems than necessarily the winning style of Kwasniewski?

MR. KAMINSKI: Well, I think that those two factors contributed to his, to his defeat. He was--at the two televised debates he was- -Walesa was leaning towards the past. He was emphasizing the period that many Poles want to forget. They want to concentrate on making money and on, on sort of conducting everyday's business, and--

MS. HUNTER-GAULT: You mean, they want to forget the revolution that Walesa was constantly reminding 'em of during the election.

MR. KAMINSKI: Well, at least 50 percent of them want to forget about it, and they want to look, well, to follow the message of Kwasniewski and to look into the future.

MS. HUNTER-GAULT: But under Walesa, didn't Poland make the most dramatic move towards a market economy in all of--

MR. KAMINSKI: Yes, certainly, and I think that his biggest achievement is that Poland is [a] a democratic country, which had several parliamentary elections where the transfer of power from one party to another was very smooth, and secondly, it has a very well-established market economy. And I think that this is the legacy of, of Walesa. He not only contributed to the end of Communism, but he also left a positive legacy of a vibrant market economy and democratic institutions.

MS. HUNTER-GAULT: So how do you think that history--I mean, you've articulated a number of negatives--but also some positives- -how do you think that history will remember Walesa?

MR. KAMINSKI: Well, I think that first of all he will be remembered as somebody who made enormous contribution to the end of Communism, and I think the paradox is that precisely because Communism was dismantled so quickly in Poland, people now want to have, at least 50 percent of them want to have somebody else as their leader.

MS. HUNTER-GAULT: You heard Jim coming into this segment talk, make the comparison between Churchill, who was defeated after winning the war, World War II, only to come back five years later, and Walesa said himself that it was his ambition for Poland to be a normal country with a peaceful transition to power. Do you expect him now to step back and fade quietly into the historical landscape, or what do you expect?

MR. KAMINSKI: Well, I don't think that Walesa can stay quiet, and as my American friend who was covering Warsaw a number of years ago in 1990 said, never write off Walesa. The political situation in Poland is such that about 50 percent of the people do not have their representatives neither in parliament nor in the president's office because of the way that electoral laws were written three years ago. So the danger is that they may turn to other institutions such as to streets, and the danger is and this would be the most--was the worst case scenario--that Walesa would destabilize the political system. I hope it won't happen. I hope that instead of that he will unite the post-Solidarity camp and will lead them to the next parliamentary elections.

MS. HUNTER-GAULT: Well, Mr. Kaminski, thank you.

MR. KAMINSKI: Thank you very much. FOCUS - PEACE FOR BOSNIA?

MR. LEHRER: Finally tonight, the Bosnia peace talks. Elizabeth Farnsworth has our update.

MS. FARNSWORTH: As of now, 6:50 PM Eastern Time, the talks are still officially underway in Dayton, Ohio, with no agreement in sight. For the latest, we go to James Graff, who's covering the talks for "Time Magazine." Thanks for being with us, James. What are you hearing now from diplomatic sources, from Balkan sources, about the negotiations? What's happening?

JAMES GRAFF, Time Magazine: [Dayton] Well, what we've heard most recently, as you've said, there is at this point no deal, in spite of the fact that the Americans at 10 o'clock imposed a deadline in hopes of really screwing up the pressure to the maximum on these delegations. there have been--there was a moment I think late, very late last night, early this morning, when there did seem to be hope that the crucial territorial issues could be somehow finessed, but because new issues were brought on the table, that has fallen apart, and right now, I'd say there's still hope or the Americans particularly are trying to keep hopes alive, they're trying to keep the flame alive on this thing, but it does not look nearly as cheery as it did just 24 hours ago.

MS. FARNSWORTH: James, what new issues are on the table?

MR. GRAFF: Well, I understand that we have a map, and there were a couple of very difficult territorial issues involved. Sarajevo is one of them. Sarajevo seems to have been solved. But the problem of Brcko, the problem with the Posovena Corridor in the Northeast of the country--

MS. FARNSWORTH: And that's a corridor that would link two parts of Serbia that are in the--of the Bosnian Serb territory that is in Bosnia.

MR. GRAFF: Exactly. There's a long wing that goes--runs East-West in the North of the country, and there's the South-North portion that runs down along the border of Serbia, itself. And those join in the Posovena Corridor. The Serbs had insisted on having a broad corridor. Apparently, there as an agreement on the part of the Muslims to make the federation, the Bosnian-Croat federation, to narrow--to keep it as narrow as they wanted. And in response to that, the Serbs brought up issues in the far West of Bosnia that people had considered not really on the table. These are areas that the Serbs lost in the Croat-Muslim offensive of September, and those have come back on the table, and those at this point seem to be what's, what's really making a problem here. Those territories that the Serbs have brought up most recently would endanger the route between Sarajevo and Bihac in the Northwest of the country, and, therefore, endanger the unity of the, of the Bosnian Federation's territories, so it's again trying to square a circle, and, you know, the same issues that have been there all along are still there, haunting us.

MS. FARNSWORTH: But you said some of the very difficult issues had apparently been resolved. I know that it's hard to get information because it's--this is something that's not open to the press, but the difficult issue of Sarajevo, for example, was that, were those problems resolved?

MR. GRAFF: It appears to be. I mean, I have talked to two of the delegations, but I haven't spoken to the Serbs about this, but the agreement that appears to have emerged for Sarajevo, the federal city, we've talked about this, a nine cantonal system within the nominally federal city that's outside both of the entities of a united "Republic of Bosnia-Herzegovina." And these entities, themselves, these smaller cantons, would have some autonomy in terms of cultural, educational policy of that sort, and therefore, would essentially be a kind of ethnic division without being the, this overt division that the Bosnian--that would have made the Bosnians leave these talks altogether. That was an absolute bottom-line position for the Bosnians, that there be a Sarajevo that is intact in some sense, and this, the very definition of where these lines go is, it sounds as though they are also favorable to the Bosnian government, so that seems to be something that had been solved to everyone's satisfaction.

MS. FARNSWORTH: What is happening there? It seems like there have been marathon negotiations. At one point, they negotiated for 22 1/2 hours. Are they in another marathon stage right now?

MR. GRAFF: Well, yes, and they're doing it. Christopher, who's not the youngest man, obviously--

MS. FARNSWORTH: Sec. of State Christopher.

MR. GRAFF: Sec. of State Christopher, right. He did 22 1/2 hours. He went to bed at 6 o'clock; he got up at 7:10, and was at it again, and there was a break this afternoon. He did take a--have a lunch--took a walk--he took a rest. But, essentially, they're at it again, and when I last checked, about 45 minutes ago, his meeting with Croatian President Franjo Tudjman, who arrived again last night, and of course, his arrival here was, was interpreted by many people--we're involved in a sort of kremlinology here, because we don't know exactly what's going on--was interpreted as a sign that we would have an agreement today. In fact, as I said, 24 hours ago there was a lot more hope, I think, than, than there seems to be right now.

MS. FARNSWORTH: What happens next? If this session, these peace talks end inconclusively, what happens next?

MR. GRAFF: Well, that--I'm afraid to use the term the State Department spokesman has used so often--that remains to be seen-- but I think we--there will be--there will not be I don't believe the announcement of a partial agreement here. I mean, even though constitutional issues seem to have been--there have been a number of areas of progress even within Bosnia, but without the territory being lined out, it really doesn't, doesn't mean anything, so I think what they'll do is they will remain seized of the issue, they will meet again in Paris in a couple of weeks, maybe hand this over to the French. I think the Americans will remain involved in some fashion. I think it's too early, though, and I should stress this, to really call it quits. I mean, there's still a possibility they'll pull something out of the bag here, but certainly it's been a lot more difficult than, than they thought. I mean, it's been 20 days.

MS. FARNSWORTH: Okay. Thanks, James, for being with us.

MR. GRAFF: My pleasure. RECAP

MR. LEHRER: Again, the other major stories of this Monday, besides Bosnia, the U.S. Government reopened for business, 800,000 furloughed federal employees went back to work. That was because the President and Republican leaders made a deal last night to fund the government through December 15th. And Lech Walesa of Poland was defeated for reelection. He lost to a former Communist. We'll see you tomorrow night. I'm Jim Lehrer. Thank you and good night.