The MacNeil/Lehrer NewsHour

MR. MAC NEIL: Good evening. I'm Robin MacNeil in New York. After tonight's News Summary, we'll preview a major flashpoint between the incoming Republican Congress and the White House, cutting U.S. foreign aid. Correspondent Tom Bearden reports on a high stakes rail chase, Charlayne Hunter-Gault takes a second look at the scourge of the streets, kids killing kids, and essayist Anne Taylor Fleming closes with a gift for all. NEWS SUMMARY

MR. MAC NEIL: The hijacking drama of an Air France jet liner ended this afternoon in a bloody assault by French commandos. All four hijackers were killed. Two dozen police and passengers suffered injuries, but in the end, most of the remaining hostages on board were rescued unharmed. The ordeal began Saturday when a group of Islamic extremists seized the plane in Algiers and forced it to fly to Marseilles early this morning. We have more in this report narrated by Richard Vaughan of Worldwide Television News.

RICHARD VAUGHAN, WTN: After 13 hours on the Marseille tarmac, the elite French Commandos moved in. The high risk operation was shown live on French television as the troops waged a 10-minute gun battle with the hijackers. A deadline for the plane to re-fuel and leave for Paris had come and gone quietly during the day, but it was not to stay that way. Later in the afternoon, the hijackers killed their fourth victim. That appears to have been the trigger for the commandos to move in. The special forces who carried out the action are experienced in this kind of commando attack. Having conducted over 650 operations against guerrillas, hostage situations, and prison riots, the force was well versed in trying to minimize the injuries. Once the troops were battling the hijackers, passengers and crew alike jumped to safety. Four hijackers were killed in the attack, and nine of the elite troops were injured. One, who had his hand blown off, is in a serious condition. Three crew were also wounded, and thirteen passengers suffered from bruises and shock.

MR. MAC NEIL: The two-day-old cease-fire in Bosnia seems to be holding throughout much of that country, but there have been scattered reports of fighting in the Bihac area. The Muslim-led Bosnian government has threatened to resume its offensive if the incursions by Croatian Serbs don't stop. After three weeks of bloodshed in the breakaway republic of Chechnya, Russian forces may be preparing to pull back from the besieged capital. President Yeltsin said today the first phase of the military operation there is over, and he offered to hold talks with Chechen officials. We have more in this report from Julian Manyon of Independent Television News.

JULIAN MANYON, ITN: This morning, the first sign that Russian resolve on the Chechen crisis may possibly be starting to crack. At an emergency meeting of the National Security Council, President Boris Yeltsin declared that this government is approaching the moment when the military presence in Chechnya can be wound up. Then in a remark, whose full meaning is not yet clear, Yeltsin said that Russian military units will be withdrawn to temporary positions still inside Chechnya. The president said that the process of installing a legal administration in Chechnya would soon begin, but he made no public reference to the fact that the Chechen capital is still in the hands of the separatists. With Gen. Dudayev's volunteers firmly dug in, despite the bombing, it is uncertain how President Yeltsin now expects his order to restore Russian rule to be implemented. Russian rhetoric is becoming divorced from the reality on the ground. This weekend, the Russians claimed to have killed a thousand Chechen militants in heavy fighting at the town of Argoon, near Grozny, but the latest reports from the spot indicate that there has been no fighting since Saturday and that the Chechens are still firmly in control, having suffered minor losses. The real meaning of today's statement is not yet clear, but it may be that the Russians are trying to conceal their growing uncertainty behind a barrage of propaganda. President Yeltsin has promised to give the Russian people full information when he addresses them tomorrow.

MR. MAC NEIL: The Clinton administration announced that a State Department envoy will leave for North Korea this evening to negotiate the release of an American army pilot. Bobby Hall has been held since December 17th, when his helicopter was shot down after it strayed into North Korean territory. His crew made, David Hilemon, was killed. Late today, the official North Korean News Agency called the over-flight a spy mission, requiring further investigation. English playwright John Osborne has died of heart failure. In the 1950's, Osborne led a post war revolution in British theater with such plays as "Look Back in Anger," and "The Entertainer." His collection of prose called "Damn You, England," was published this year. Osborne was 65. Italian singer and actor Rosanno Brazzi has also died. His most famous role was in the 1958 classic "South Pacific," one of the 200 movies he made. Brazzi died of a virus in Rome. He was 78. That's it for the News Summary. Now it's on to a battle over giving, running a railroad, stopping the violence, and why we worship. FOCUS - WHITHER FOREIGN AID?

MR. MAC NEIL: First tonight, a looming battle between the White House and Capitol Hill. Margaret Warner got a preview when she led this debate last week.

MS. WARNER: For years, there have been calls inside and outside Congress to reform the American foreign aid program. Now, with Congress about to fall under Republican control, debate has intensified over whether and how foreign aid will survive. We'll have our own debate right after this background. America's foreign aid program began when President Truman offered assistance to post World War II Europe, help that included the Marshall Plan.

PRESIDENT HARRY TRUMAN: [1947] I recommend that the Congress speedily complete its action on the European recovery program. That program is the foundation of our policy of assistance to the free nations of Europe.

MS. WARNER: That program was soon followed by others for Asia, Africa, the Middle East, and Latin America. For most of the past 50 years, American foreign aid was driven by Cold War concerns. It was designed, above all, to check the spread of Communism. Of the $436 billion spent on foreign aid since 1946, 2/3 went for military help to countries that the U.S. felt were threatened by Communist neighbors or internal rebel movements. The balance went to humanitarian and development projects, feeding the hungry, building schools and hospitals, and extending emergency relief to refugees and disaster victims. But foreign policy goals have always been at the forefront of deciding which countries got aid. Nearly half of each year's foreign aid budget, for example, has gone to Israel and Egypt since they signed the Camp David Peace Accords in 1979, and major new recipients in this post Cold War era are Russia and the other former republics of the Soviet Union. The United States actually ranks last among all donor nations in the percentage of Gross National Product it allocates to overseas assistance. The foreign aid budget for fiscal 1994 was $12.3 billion, with about half of that going to economic and development aid. According to the Agency for International Development, which administers much of this aid, that amounts to 1/2 of 1 percent of the total U.S. budget. By another reckoning, foreign aid costs the average taxpaying family $44 per year, yet, foreign aid has been and remains one of the most controversial government spending programs. Critics in and out of Congress attack it as an ineffective giveaway. Now, the incoming Republican chairman of the Senate Foreign Relations Committee, Jesse Helms, vows a new, even tougher look at foreign aid.

SEN. JESSE HELMS, Senate Foreign Relations Committee: I think we ought to replace it with something that does not willy nilly give away United States taxpayers' money to foreign governments who are opposed to us, or at least opposed to civil rights and all the rest of it.

MS. WARNER: In recent weeks, other members of Congress have joined Helms in urging a reduction in U.S. foreign aid.

MS. WARNER: Now, four views. Brian Atwood heads the U.S. Agency for International Development, or A.I.D.. Catherine Gwin is vice president of the Overseas Development Council, a Washington think tank that deals with development issues. Alan Keyes is an adjunct fellow at the Heritage Foundation, a Washington think tank, and also a syndicated columnist and radio talk show host. A former foreign service officer, he was an assistant secretary of state in the Reagan administration. And Sen. Mitch McConnell, Republican from Kentucky, is the incoming chairman of the Senate Appropriations Subcommittee that handles foreign aid. He has drafted a foreign aid bill for next year that would cut foreign assistance, revamp the way it's given, and abolish A.I.D. altogether. He joins us from Louisville. Sen. McConnell, what is wrong with the way U.S. foreign aid is dispensed right now, in your view?

SEN. McCONNELL: Well, I think, essentially, Margaret, we need to quit subsidizing failure abroad, and a good rule of thumb might be if it's a project that we wouldn't consider funding here at home, we certainly ought not to fund it overseas. We need to get away from sort of treating the symptoms of poverty and start dealing with the cure. And the cure is clearly the free enterprise system. We know that that is the only thing that will certainly lift people out of poverty. We know that works. And I'd like to quit subsidizing failure abroad, and that's essentially the concept embodied in the new foreign aid bill that I unveiled a week or two ago.

MS. WARNER: So you would target your aid to countries, what, that simply, that promised or did pursue free market economies?

SEN. McCONNELL: The first priority would be America's national interests abroad, and I find those national interests, and I think most Americans do, in the Middle East and in what used to make up the Soviet Union and the Warsaw Pact. There we have a clear national interest, I think arguably a national security interest, particularly with regard to the former Soviet republics, in preventing the re-emergence of the Russian empire, so away from those two areas of geopolitical significance to us, the fundamental underpinning for funding anywhere else in the world, it seems to me, ought to be trade. I would actually increase funding for the Trade Development Administration and for the Overseas Private Investment Corporation, actually increase that funding, but I would take away a sort of guaranteed earmark. For example, the continent of Africa has had a sort of perpetual earmark of about 800 million dollars. I don't think there ought to be an earmark for them or for any other part of the world where we do not have a clear national security interest. There would be a residual pool of funds, up to $3 billion unearmarked, that countries in Africa and countries outside of Africa that have basically made no progress could still compete for, but I would want to target that assistance in a way that guaranteed some results. And we know we're only going to get results when we try to encourage the spread of capitalism.

MS. WARNER: Mr. Atwood, what do you make of that criticism, that basically U.S. foreign aid has been essentially subsidizing failure?

MR. ATWOOD: Well, I think there was some merit to that criticism. We've tried to change the program in the last couple of years. We have moved out of 23 countries, several of which would fall in that category. Indeed, we had been subsidizing failure. They were non- performers. Their government policies did not support development, so we moved out. We've reformed the program significantly in the last few years, and we are not that far apart from what Sen. McConnell is saying. We would agree -- we've reduced the program by 20 percent. That's very significant, given that we were already the lowest contributor to foreign aid in the world as a percentage of our GNP. So we're not that far apart in terms of where we want to go. There is more to economic growth than just supporting the economic policy reforms that Sen. McConnell wants. If you have rapid population growth, you're going to have a problem sustaining economic growth. If you have environmental degradation, you're going to have the same problem, and if you have weak governance, you will that problem. We think that's all part of a comprehensive approach to development that will work to defend American interest.

MS. WARNER: Ms. Gwin, which of these two views that you've just heard best expresses your own? In other words, where do you think the emphasis ought to be in U.S. foreign aid?

MR. GWIN: I suppose Mr. Atwood's views express mine most closely, but I am interested in how much common ground there you may have just heard between the first two speakers. You heard Mr. Atwood say that he's already moved in the direction of making reforms in the program. These are changes that are possible in a post Cold War world. Let's not forget that prior to the end of the Cold War, much of the objective for U.S. foreign aid was the pursuit of that issue, and much of our aid was directed to countries not because they were taking effective development, making development efforts, but because they were allies of ours in the Cold War, and so for a period of time, for example, in the decade of the 80's, the four largest aid recipients in Africa were Sudan, Somalia, Liberia, and Ethiopia, I believe. These were countries who were important to us on geopolitical grounds or said to be important on those grounds, and aid was given largely for those reasons. If we measure the effectiveness of the aid given to those countries against development criteria, we have a problem. We are no longer constrained in that way, and we can be more selective in the allocation of aid to specific countries. And I think that's what Mr. Atwood has said he agrees with, and, in fact, the way the program is moving now.

MS. WARNER: Mr. Keyes, do you agree with Sen. McConnell's assessment that aid should be targeted at [a] in either countries which we have a strategic interest or [b] for the rest of the countries then it should strictly be a sort of a competition in which ones are trying to turn themselves into the economic models that we agree with?

MR. KEYES: I would say that the basic principle is, in fact, correct. Foreign assistance shouldn't be looked upon as some kind of charity program since, of course, the contributions made to it are not voluntary. They are tax money. Tax money should serve clear and overriding public purposes in its views, and that means it should be tied to a policy purpose and a policy result that we've thought through and can clearly identify. That implies, of course, that you're using your foreign assistance in the context of a clearly thought out strategy as to what the United States is trying to achieve in the world. So there's a foreign policy requirement to begin with that then allows foreign assistance to be effective. I would say that at one level one of the things I think we are not doing well right now in any of this is adjusting to the reality of the post Cold War period in which if you look around at the different things we've been engaged with in the world a lot of them are not just country specific. They're also do to the failure of regions to deal with their problems. And I think one of the things we need to start looking at is whether or not in terms of the residual funds that Sen. McConnell talks about, the ones that aren't directly tied to an identifiable U.S. security interest, we don't have to start looking at ways in which we develop the ability of different regions of the world to have countries working cooperatively on both their economic and their security problems. The bilateral nature of a lot of our assistance, government to government, in ways that sometimes subsidizes the worst kind of government policies I think is something we need seriously to review.

MS. WARNER: Now, you just said, though, this is not a charity program. But let me ask you this question in the Christmas season. Do you think that as the world's richest country, the United States has any obligation, just a purely altruistic one, to help other countries financially?

MR. KEYES: As individuals, I believe we can have obligations to act on a charitable basis. The money that is given to the United States government is not given for charitable purposes. And I think it's a mistake to try to justify it on those grounds. I would consider it more like the kind of money that businesses spend doing public relations and community relations. It does produce good results in the community, but the aim is to facilitate doing business in that community. It's not just charity. And that allows you to know when you're being effective, and it allows you also to continue bearing that cost even when sometimes it constrains your budget a little bit because you know charity, for instance, is something we usually do out of our surplus because we don't consider it part of our natural expenses, whereas, if it's a cost of doing business, you might cut it, but you won't eliminate it if it's producing a result.

MS. WARNER: Mr. Atwood, where do you come down on that question, whether we have a responsibility just as the world's richest country to help other countries, even if there's no self-interest?

MR. ATWOOD: Well, there's a humanitarian aspect to this when we have refugees flowing out of countries like Rwanda, Somalia, President Bush sent our military in along with A.I.D. to help feed people. So there's a humanitarian aspect that's strongly supported by the American people, but what I'm worried about, frankly, is that we're spending a lot more money on handling these kinds of disasters than we are in investing in preventing them. We have a real need to try to deal with conditions that cause the Rwandas and the Somalias. Now Sen. McConnell's expressed some skepticism that this has worked. Now, I agree. We have not invested, we have not organized properly -- I'm not just talking about the United States government -- I'm talking about the entire international community -- to try to deal with the conditions that create crises. We must do it. It's not enough when an arson is going around burning houses in a neighborhood to say let's, let's use a fire hose here, let's strengthen the fire department. What we've got to do is to get the arson. What we've got to do is to deal with the cause, the root causes of these problems.

MS. WARNER: Sen. McConnell, let me ask you about that particular point, namely that if all we do is come in after the fact, that it ends up being much, much more expensive and that money can and should be spent to prevent the Rwandas and Somalias before they're such expensive disasters that we have to help fix.

SEN. McCONNELL: Well, Margaret, the root cause is the absence of capitalism, the absence of governmental reform that brings about a free enterprise system. That's the root cause. We don't have enough money to eradicate human need abroad. Although when there's an emergency situation, even I am very skeptical about anything working beyond a free enterprise system. Even I would maintain, still maintain an earmark for those disaster assistance and for refugee assistance in the reform bill that I've proposed, which would eliminate my friend Brian Atwood's agency. So I think there is a place for emergency assistance when that occurs, but I disagree with, with Brian that the way to avoid the emergency developing is the kind of preventive -- the treatment that we've been engaging in. I think the kind of preventive activity that will avoid the disaster is free enterprise, and I think that our expenditures, to be selectively targeted only at those countries that are willing to reform, to privatize, and begin to grow their own free enterprise systems, because that's the only thing that will work. Anything else is a waste of money.

MS. WARNER: Ms. Gwin, can you point to any major successes in the foreign aid program that have prevented these disasters, potential Rwandas, from developing? In other words, in trying to figure out who's right here between Sen. McConnell and Mr. Atwood, are there success stories where foreign aid was targeted in such a way that prevented a disaster?

MR. GWIN: Margaret, I think in answering that question, it helps to take a reasonably long historical look at the question, and rememberthat there are countries who are now, are most, are some of our fastest growing markets, some of our strongest allies in the world who were our major aid recipient countries only 20 years ago. South Korea and Chile are just two examples of countries who were major aid recipients and who have, in fact, made the economic reforms, made the economic developments, dealt with improving the well-being of their populations, broadly speaking, and who represent successes in the world, not strictly because of foreign aid but foreign aid was an element in their history over the last 20 years.

MS. WARNER: Let me get Mr. Keyes to come in on that.

MR. KEYES: Well, I would just add that my memory could be faulty, but I think we had phased out most of our foreign assistance to Korea by the time you get into the early 60's, but -- and that a lot of the growth spurt of Korea occurred between '60 and '85 and was not much influenced by any foreign assistance from the United States. It was driven, in effect, by a willingness to start up and adhere to free market principles and to base one's effort to develop on the understanding that you had to develop a robust economy in order to trade with other nations. And I think that that's what Sen. McConnell is talking about. We've got to look at the models that have worked, and they haven't been driven by development assistance or basic needs approaches. They've been driven by the need to develop free enterprise in such a way that you can have a solid economic foundation based on productivity and trade.

MS. WARNER: So you are saying, in other words, that in your opinion foreign aid has never served a useful purpose?

MR. KEYES: I wouldn't say that. If you define the purpose of foreign aid, as I think is rightly to be understood, as a way of helping to facilitate our efforts to do business in the world, diplomatically in terms of trade and other things. I think it has served a purpose. It has served a purpose in developing contacts, in maintaining relationships with other countries.

MS. WARNER: But I mean for the other countries.

MR. KEYES: But in terms of development assistance, I would say that especially if you do it on balance, there is not a good case to be made, but our development assistance has, on balance, done more good than harm. I think it is probably the other way around.

MS. WARNER: You've been trying to get back in. Yes.

MR. ATWOOD: I'd just like to make a comment on that because, I mean, I don't have any difference with Alan Keyes or Sen. McConnell on the question of wanting to achieve free enterprise systems, but how do you think these things happen? They don't just happen because someone reads Adam Smith's book and all of a sudden declares that we're going to have policies. They happened because you look at the human capacity within the society. You educate people, you strengthen governmental institutions, so that they served the purpose of a free economic system, and that they create markets. And that's what our foreign aid program does. What I am really fearful of right now as we move into the new Congress is that there are people who do not take the same position of Sen. McConnell or Alan Keyes with respect to foreign aid who I think are truly isolationist who don't want us out there helping to develop new markets for American goods. I'm very concerned about that, and I'm concerned that in the first one hundred days this is going to be swept around and that the reasonable constructive criticism that people like Sen. McConnell put forward is going to be lost in a dynamic that we can't control.

MS. WARNER: But now, Mr. Atwood, Sen. McConnell wants to wipe out your agency altogether and send it to the State Department. Are you comfortable with that?

MR. ATWOOD: No. Of course, I'm not comfortable with that. Why would I be? But let me just tell you something. More is at stake here than the existence of a bureaucracy. I'm not defending foreign aid because of a bureaucracy. I think that Sen. McConnell is aware of the reforms that we've made inside A.I.D.; it is a model for management. What is really important is the effectiveness of our ability to deliver these programs and our ability to tell Sen. McConnell what results we've achieved with our programs. So A.I.D. is not the issue here. It's the role of the United States in the international community and the ability of the United States to lead other donors to do what we think is right to create a stable world environment.

MS. WARNER: Sen. McConnell, let me ask you, do you agree with Ms. Gwin that there's really a lot of common ground between yourself and Brian Atwood in terms of where foreign aid should be moving?

SEN. McCONNELL: Well, I think Brian Atwood has done the best job he could with an outmoded agency that ought to be eliminated. I am a supporter of foreign assistance. I think we ought to continue to have a foreign assistance program. I think it principally ought to support our national interest because I think aid and interest ought to be indispensable. Right now what we've got an agency, A.I.D., which exists in splendid isolation which dispenses aid which may or may not also be in our interest. I think we can't afford that luxury any longer. I think Brian has done the best job he can with this dinosaur, but I think it's time to, to put it to rest and to create a model within the State Department clearly oriented toward our foreign policy interest and slim it down some.

MS. WARNER: So, in other words, your interest really is in revamping the way it's done, less saving money.

SEN. McCONNELL: I want to do both.

MS. WARNER: But how much would you really cut it?

SEN. McCONNELL: Overall, I would cut it at least 10 percent. Outside of the Middle East and what used to be the Soviet Union, I would cut it at least 20 percent.

MS. WARNER: Well, Sen. McConnell and Mr. Atwood, Ms. Gwin, and Mr. Keyes, I'm afraid that's all the time we have, but thanks very much.

MR. MAC NEIL: Still to come on the NewsHour, riding the rails, ending violence, and finding the answers. FOCUS - ALL ABOARD

MR. MAC NEIL: Now a story about three railroads, two courtships, and one rejection. Tom Bearden reports.

MR. BEARDEN: The great railroads cast a long shadow over the American economy. Coal, grain, chemicals, lumber. The big commodity shippers where the railroads still do most of their business are affected by every turn and tremor of the industry they can't live without. When the country's two biggest railroads are frantically chasing a third, like what's happening now with the Burlington Northern and the Union Pacific pursuing the Santa Fe, it's more than just a routine business merger. Justin Zubrod with the management consulting firm A.T. Kearney thinks it's the beginning of the final shakeout of the industry.

JUSTIN ZUBROD, Transportation Consultant: It's sort of the logical next step, whereas when you looked at the railroad mergers during the 1980's, most of them were driven by cost deficiencies and so forth. These are driven by expanding the network, building a franchise, and gaining access to new markets.

MR. BEARDEN: Shakeouts of one sort or another have been going on since railroads were created. A hundred years ago, railroads dominated the development of industrial America. They were the largest enterprises of their time. Eventually, they became so powerful that the federal government acted to rein in their excesses by forming the Interstate Commerce Commission in 1887. It began a government industry dance that was to last 93 years. Decline began to set in in the 1950's. Trucks running on the new interstate highway system began to skim off the most profitable freight, leaving the railroads to haul lower profit commodities. The railroads were slow to respond, and they began to fail. Great names like the Penn Central disappeared into bankruptcy. Dick Davidson is chairman and CEO of the Union Pacific.

DICK DAVIDSON, CEO, Union Pacific: We had an inward focus. We focused on running trains. We didn't focus on the customer, and we didn't focus on the car. To try to distinguish it, we used to worry a lot if a train left Chicago or Omaha and got to California on time. We didn't worry if it had the right cars or that it was delivered to the customer at the right time, but if we got that train there, we were doing fine. It might not be the time the customer wanted the train to run, we didn't give a hang about that.

MR. BEARDEN: Railroads as a living, breathing industry began to fade from the public consciousness. People began to think about them as quaint anachronisms, nostalgic reminders of the past, if they thought about them at all. But while most Americans ignored railroads, the government was turning them upside down. In 1980, President Carter signed the Staggers Act, giving the railroads the freedom to set most of their own rates for the first time. It touched off a frenzy of reform and rebuilding. Many roads merged. Unprofitable routes were abandoned. The work force was slashed. Sophisticated new communications systems were introduced that allowed a few dispatchers to control an entire railroad from one location. Aaron Gellman runs the transportation center at Northwestern University.

AARON GELLMAN, Northwestern University: It's done wonders for the railroad industry. It's allowed them to do things they couldn't do before, but it's also galvanized them competitively in ways that they weren't before. I mean, we see, for example, that railroad productivity is up 140 percent in labor terms. Employment is down 40 percent. Traffic is up in terms of ton miles. Rates are down in real terms. It's just a remarkable achievement on the part of the railroads which I think we deserve very high marks for.

MR. BEARDEN: But Santa Fe's CEO Robert Krebs says there is much left to do.

ROBERT KREBS, CEO, Santa Fe: Right now, it's crazy. Santa Fe can handle traffic from Chicago to Los Angeles, 2200 miles, in 48 hours. Sometimes it takes 48 hours just to get a car 40 miles from one side of Chicago to another when you interchange it with carriers. Those -- that's the horse and buggy days. That has got to stop.

MR. BEARDEN: In the 80's, Santa Fe began to work more closely with the truckers and became a big presence in so-called intermodal shipping where sealed containers moved from truck beds to train cars for the long haul, then back to trucks for final delivery. This summer, Santa Fe agreed to a friendly merger with Burlington Northern, a railroad that does a lot of business in bulk commodities. They ship coal to power plants and grain from the farm belt to urban markets. Santa Fe's routes run from the Midwest to the Southwest. The Burlington Northern lines follow a more northerly route on their way West. To both sides it seemed like a good match. But another suitor for Santa Fe was waiting in the wings. Omaha-based Union Pacific Railroad also connects the Midwest with the far West, but UP's planners felt that their routes to Southern California were less direct. A few weeks after the Burlington-Santa Fe merger was announced. UP made its own hostile bid for the Santa Fe. Both companies say their opponent's proposal will lessen competition and will be rejected by the Interstate Commerce Commission which must approve any merger. Doug Babb is general counsel for the Burlington.

DOUGLAS BABB, General Counsel, Burlington Northern: It's like Goliath becoming Samson in a way because the Union Pacific already has the dominant system in the West. They're already in every market. They're already a very strong competitor. And for Union Pacific to acquire Santa Fe is going to result in a lot of reduction of competition.

DICK DAVIDSON: The truth of the matter is the Burlington Northern is a bigger railroad than we are in terms of miles today, quite a bit bigger, five or six thousand miles larger, so, you know, for a Goliath, hopefully, it's because we're doing a good job of running the company. It's not because we were inherently a larger company or our revenues were a lot bigger.

MR. BEARDEN: Each railroad points to places where it rival's proposal would create overlapping routes.

MR. BEARDEN: Are parts of their proposal anti-competitive?

DICK DAVIDSON: Well, it could be. Surely. They have routes as well as an example between Denver and Texas, where their rail lines will go from two to one.

DOUGLAS BABB: It's simply not true. Between Denver and Texas there are three major competitors today. There's a Santa Fe system, the Union Pacific System and the Burlington Northern System.

MR. BEARDEN: The Burlington says they fit better with the Santa Fe, because it's more of an end-to-end merger, whereas the Union Pacific and the Santa Fe are direct competitors with a great deal of parallel track.

JUSTIN ZUBROD: There are merits to, to all sides of the argument. Certainly both mergers or both petitions will result in some sort of disruptions but net a tremendous advantage for, for the industry and, and for the shipping public as a whole.

MR. BEARDEN: But not all shippers are convinced. Ed Emmett runs the National Industrial Transportation League in Washington. They represent companies that do large volume shipping with trucks and railroads.

EDWARD EMMETT, Industrial Transportation League: Twenty years ago there were seventy some odd class one railroads. Today there are thirteen. At every major merger along the way, shippers would say, well, it's not a big deal but sooner or later there are going to be too few railroads. I don't know that 13 is too few. I don't know that seven or eight, but somewhere there's a number, and so the pattern that's set by this major merger I think will affect those future mergers, and that's what concerns shippers.

MR. BEARDEN: Some shippers are worried that this merger and those that might follow could leave them at the mercy of a single railroad, which could then charge whatever the market would bear. But Burlington's Ron Rittenmeyer says today's marketplace is too diverse for that.

RONALD RITTENMEYER, Vice President, Burlington Northern: Well, if you stand back and look at many of the shippers, they have other options. There is barge traffic. There is truck traffic. There is other rail traffic. We are not going to be, by ourself, in any major segment. All segments we will have some type of competition from other rail. There also is truck competition, and we fight truck competition every day. Railroads do not just compete with railroads; they compete with trucks. They compete in many segments with barge traffic, water traffic. Shippers will have options, and competition will not change.

MR. BEARDEN: Emmett says that's not true for all shippers.

EDWARD EMMETT: The nature of railroads make railroads different than say other modes of transportation. If you don't like the truck firm that provides service, you call up another trucking firm, and they come up the same highway. If you don't like the railroad that gives you service, you don't have that choice, because the odds are there's only one rail track outside your plant. And if you ship the kind of heavy equipment or bulk commodity that requires rail, then you are frequently captive to that railroad.

MR. BEARDEN: The final decision on a merger falls to the same agency that began regulating railroads a century ago, the ICC. Many think it may deal with the problem of reduced competition by ordering the winning railroad to let other roads run their trains over its tracks. The Union Pacific has already offered to do that as part of its merger proposal. Waves of railroad mergers have been going on since 1838. Many say the industry is on the verge of a new round, that whichever railroad loses out will search for a new partner. Other lines are expected to follow with mergers of their own. The U.S. could end up with four or five transcontinental railroads and perhaps as few as three before this process which began in 1980 reaches a new equilibrium. SERIES - BREAKING THE CYCLE

MR. MAC NEIL: Next tonight, teenage violence. Starting next month, public television in cooperation with a coalition of private groups will launch a multi-year effort to break the tragic cycle of youth violence in our society. Earlier this year, Charlayne Hunter-Gault had a series of conversations with people who had some unusual ideas about solutions. This week we thought it warranted a second look.

MS. HUNTER-GAULT: This is art, in a manner of speaking, a made- for-television movie about young people caught up in the vicious and inescapable cycle of violence. This is reality, a three-year-old struck in the head and killed after teenagers fired eighteen shots through his family's front door, an eleven- year-old boy abducted, beaten, and set on fire by a thirteen-year- old police say tried to force him to smoke crack, a fifteen-year- old girl shot in the head while walking to school with friends, a sixteen-year-old was charged. These particular acts of violence occurred in New York City, but experts on juvenile violence say similar scenes are being played out in cities, suburbs, and even tiny towns all over the country. And all are struggling with the same dilemma, what to do about the small but growing number of violent young people. Stronger punishment is one rallying cry, an option that would see juveniles tried as young as thirteen in adult courts. In a recent nationwide poll, 40 percent between the ages of 13 and 17 said they knew someone who had been shot in the past five years and that both the victim and the attacker were teenagers.

THERESA: [Young Girl] I'm Theresa, and I'm just going to take you through the exercise that we're going to be doing.

MS. HUNTER-GAULT: Some young people are fighting back but not violently. Instead, they are confronting their fears and their emotions and training others to do the same. They're called "peer leaders." As part of their summer vacations, about 200 of them met outside Boston for a series of violence prevention workshops. The 10-year-old peer leadership program is sponsored by the Massachusetts Department of Public Health. The program uses techniques like role playing to help teenagers find ways to avoid the pitfalls of such problems as drug abuse, teen pregnancy, and violence.

YOUNG GIRL: [role playing, talking to another girl] Excuse me, who's this?

SECOND YOUNG GIRL: What do you mean? Who are you?

MS. HUNTER-GAULT: The teenagers, most of whom have been touched by violence in one way or another, say acting out real life situations teaches them how to avoid confrontations that could quickly escalate into life threatening situations. During a break, we talked with four of them: Theresa Job and Taneeka Freeman, both 17-years-old, 18-year-old Ron Ptaszenski, and 15-year-old Jose Pagan.

MS. HUNTER-GAULT: Thank you all for joining us. Each of you has been in one way or another dealing with violence in your lives either as counselors or personally involved in some way in incidents. Can you just start by telling me briefly how violence has touched your life personally.

TANEEKA FREEMAN: Well, umm, I just lost a friend in February, and I knew him in the first grade. We met in the first grade, and like over the years, we kind of separated. He went to Southeastern, and I went to Brockton High, and I didn't really -- I didn't really know him know him, but when he got murdered, it kind of, you know, it finally hit me. And the thing that bothered me the most was he wasn't bad at all, it was his friends.

MS. HUNTER-GAULT: And do you know many young people who have been victims of violence in your circles, a lot?

TANEEKA FREEMAN: A lot, around 20, yeah, since -- between 1993 and this year so far I'd say.

MS. HUNTER-GAULT: Twenty people --

TANEEKA FREEMAN: Not dead, but, you know, have been victims of violence.

MS. HUNTER-GAULT: Ron.

RON PTASZENSKI: Umm, one teenager got stabbed in the high school in Dartmouth. A nurse got shot in Acushnet, and then there were the drive-by shootings not too far from my house, and I knew two of them.

THERESA JOB: Umm, there was like a couple of stabbing incidents in my school and I haven't been personally affected in the sense that -- you know, I haven't lost any of my close friends, but I hear about it, and you know, my friend, her friend getting shot or things like that.

MS. HUNTER-GAULT: Jose.

JOSE PAGAN: Well, I lost two friends in the past year. One was my record producer. He was trying to cut an album, and he got stabbed and died. I was almost shot about three months ago. Somebody tried to kill me, and that's what like really kind of straightened me out, you know. I was doin' bad stuff, you know, and I decided, you know, to change my life, because I didn't want to die.

MS. HUNTER-GAULT: What do we know about the kids that you come in contact with who are involved in violence?

RON PTASZENSKI: They all like, they all joined whatever they're doing to try and get more friends, to try and get respect. They all want respect, but the thing is they don't really got the respect. The weapon they got is the respect. They got a gun. The gun -- the bullet come out of the gun -- that's respect. It's swinging a bat at somebody, that got the respect. It ain't you that got the respect, it ain't you that people are scared of, it's the gun, it's the knife.

MS. HUNTER-GAULT: Is respect the main reason why kids --

TANEEKA FREEMAN: Sometimes, but in a lot of cases they're kind of forced into the stream. Maybe they're havin'problems at home, financial problems at home, and selling drugs may be the only way that they feel they can take care of that problem, and selling drugs brings on the violence. So it doesn't always have to deal with respect.

JOSE PAGAN: Today most of the violence deals with respect. Most of it is props, you want to get your props. You don't want to be a sucker because once you get labeled a sucker, there's no turning back from it.

TANEEKA FREEMAN: There's money, definitely money. It's all about money nowadays.

MS. HUNTER-GAULT: Is it money because the young people are -- come from poverty or from poor homes?

JOSE PAGAN: Like my cousin, he was really poor, and I used to rob people with him.

MS. HUNTER-GAULT: You used to rob people with your cousin?

JOSE PAGAN: When we little, yeah, we was little kids, we used to rob people, with him, because we was poor, we didn't have nothin', and he wanted -- when we wanted somethin', we would just take it. We was like twelve, thirteen back then. We used to rob people usually at night. We used to rob people. We never stabbed anyone but we just, we just scared people up, and took their stuff.

MS. HUNTER-GAULT: But did your parents -- you live with your mother and father?

JOSE PAGAN: I live with my mother and my stepfather.

MS. HUNTER-GAULT: And did they in the home try to teach you right from wrong?

JOSE PAGAN: See, what it is, is people say it's not your mother's fault, it's not your father's fault, it's you, it's you, it's you. It is your parents' fault in somewhat -- in some areas, because the only reason you got that bad is because they weren't firm enough with you. If they had told you to stay in, if they had checked on you in your room to make sure you was in your room and you didn't sneak out, if they had whipped your butt every time that you got out of line, if they had, you know, told you you can't go out for the next three weeks because you did so and so. My father, I think, if he, if he didn't have the problems in the beginning with drugs and alcohol and being a drug dealer, I think that he would have been an all right guy because he was the firmest with me. I mean, whenever I went to visit him for a week or somethin', I mean, he used to tell me to do somethin' and I didn't do it, and he would, you know, bust my tail, you know, 'cause he didn't play that, you know. I did what he said when he said it.

MS. HUNTER-GAULT: Do you all -- you all followed that case in Singapore of Michael Fay? What do you think about that?

RON PTASZENSKI: I think that's right, to tell you the truth.

JOSE PAGAN: You know, 'cause that's like me going in your house, right, and goin' up in your kitchen and start graffitiing your kitchen. That's what it's exactly like. He went up in somebody else's country and just went up and did that. He knew what he was doing. I think he deserved twice as many lashes as he got.

THERESA JOB: Look at the crime rate there and the crime rate in America. I mean, that just shows you, I mean, I mean, we don't do anything to kids that do crimes and, you know, graffiti, that's like an example, and they do something about it, and they get good results, and I think we should have learned from them.

MS. HUNTER-GAULT: Well, in that connection, more and more adults are pushing to have violent kids locked up and put into adult courts where the punishment is, is harder. What do you think about that? I mean, have you -- do you think that's a good idea?

JOSE PAGAN: I don't think kids -- I don't think anyone under 17 should be, umm -- unless it was like -- if somebody was like 16 and they murdered like 15 people -- I mean, I can understand that, putting 'em with grownups, but I don't think any kid, even if it's one murder, I think they should get maybe a maximum security juvenile jail because you know how many people -- see people say that's not true, right, but I've been to a prison, and I know what goes on there, and three out of every five people have AIDS, and you think that when you lock somebody up, they're going to go in there and they're going to come out fine. That's not right. They're probably going to get raped. That's the same thing if I put you in there with a bunch of men, chances are you would be raped a few times.

MS. HUNTER-GAULT: So this is not a place for young people you think no matter what crime?

TANEEKA FREEMAN: I disagree. I firmly disagree. I feel you do the crime, you take the time. I don't care how old you are. I mean, if you are -- when you are 16, a lot of people are mature enough -- I know I was 13 when I was a freshman, and I was mature enough. These people are mature enough to make the decision to take a gun and kill somebody, they're mature enough to be put in a prison.

MS. HUNTER-GAULT: Do you think that people who kill people with guns, young people, are mature, they know what they're doing?

RON PTASZENSKI: They know what they're doing. They really know what they're doin'. They know that the gun -- all they got to do is pull the trigger. The -- most of the time -- well, not most of the time, some of the time the know exactly who they are going after.

MS. HUNTER-GAULT: You all talk to young people and you try to intervene, you try to get them to not be violent, to resolve issues in a different way. Tell me a little bit about that and how do you get them to listen to you as you try to -- you know, without coming off as goody goody?

RON PTASZENSKI: Well, basically from my standpoint, I was with two groups. I was an adviser of one and I was a peer leader of another. And what we did was we'd go to the thing, we'd start a discussion, and we would listen to them. You know, they'd come up with what they think is the problem with this teenager, why they's doing the violence and stuff, and then we'd just facilitate it, and if somebody, if somebody was to start, let's say crying or something, we'd go out of the room, one of us would go out, talk to him, so it's basically like, we're kind of like, you can say kind of like counseling but we're not, because we're not, you know, certified to do it.

MS. HUNTER-GAULT: But you just let them talk?

RON PTASZENSKI: We just let them talk, and they get everything off their chest, what they want to say.

MS. HUNTER-GAULT: Is it easier to talk to younger kids, or do the people who are your same age, will they listen to you? I mean --

TANEEKA FREEMAN: I think that if you are the same age group they're more so apt to listen to you because you know, they feel that you know more so where they're coming from. Umm, I think that they need a sense of hope and to be strong, a lot of times they feel that they can't say no or they can't get themselves out of certain situations.

THERESA JOB: I think in my experience it's definitely easier to talk to younger kids because I feel like they look up to me, and it's easier for them to talk to me, and just to let them know that I'm out there, and people are out there, and we actually care, and we want to listen to you. That's been my experience. I mean, it's harder for me to talk to kids my own age because they feel like, you know, I'm not out there, I'm from a different, different situation, and I'm not, you know, I don't carry guns, or I'm not a violent person

MS. HUNTER-GAULT: Can you give me any specific example that you can think of where you intervened in the way that you talk about, you know, pointing out this isn't cool or whatever, however you do it that's made a difference?

JOSE PAGAN: I break up a lot of fights 'cause I'm always walkin' around places, and if I see a fight start to break out, even if I don't know the people, sometimes it's embarrassing, but, umm, I just walk up --

MS. HUNTER-GAULT: And dangerous too probably.

JOSE PAGAN: Yeah. You can get stabbed in the middle of somethin'. I broke up a few fights downtown, and I seen people started to fight, and I was shopping, just put my bags down and walked over and tried to hold them back, not looking like a nerd or nothin' like that, can't we all just get along and you know, I go up and I speak to 'em like a normal -- I mean, we're not goody two shoes, we're not nerds. We go clubbing. We do everything a normal teen does. We just don't choose to get in trouble, do drugs or anything.

MS. HUNTER-GAULT: What do young people want from adults? What kind of help can society provide to, to help this problem of violence?

RON PTASZENSKI: Just support us, you know, get involved, and --

MS. HUNTER-GAULT: Get involved? What do you mean, get involved?

RON PTASZENSKI: Get involved in what we do. You know, if a youth group has a rally, we would like to see the adults there supporting us, what we're for.

JOSE PAGAN: Have fun with your kids at their age because they grow up so -- I mean, we grow up so fast. I mean, I wish when I was little my mother took me, you know, out to the zoo and did all the little -- even it's like every Sunday afternoon, you know, you all do something together.

MS. HUNTER-GAULT: Taneeka.

TANEEKA FREEMAN: I think they should volunteer. A lot of places have to close down because they're short staffed, and it's just important for them to show support, kill all the stereotypes, you know, just --

MS. HUNTER-GAULT: What do you mean kill the stereotypes?

TANEEKA FREEMAN: A lot of -- I feel that a lot of adults, they look towards certain kinds of youth, I'm going to say African- American youth because that's more so what I identify with -- they look to them as, you know, like the lost generation, umm, extinct species, but yet, can you have a little hope, because when the adults start thinkin' that way, the youth start thinkin' that way. And it's because, you know, adults, a lot of youths look up to adults as role models, and if your role model is sayin', you know, well, the young, black males, they're dying every day, yeah, they're dying every day, but what can you do to, umm, to keep them from dying?

RON PTASZENSKI: What she said about the lost generation, I heard it said yesterday, when we -- we teenagers were saying we ain't the lost generation, we're actually the new generation, we are the generation that's going to keep this world going. We're going to be the generation that's going to lift this, lift the world up, lift the United States up to where it should be, you know. There's a lot of crime and stuff, but now everything's gettin' better. There's a lot of groups out there like us, for example, a lot of us are -- all of us are in peer leader groups. There's a lot of those groups that are buildin' up.

MS. HUNTER-GAULT: Well, Theresa, Ron, Taneeka, and Jose, thank you all for joining us.

GROUP: Thank you. ESSAY - POWER OF PRAYER

MR. MAC NEIL: Finally tonight, essayist Anne Taylor Fleming on the power of prayer.

ANNE TAYLOR FLEMING: It is a thing people do every day, every way, one of those things by which we know ourselves to be human, needful, hopeful, frightened, one of those things is elemental for them as eating for working. Spin a globe or scan a map and put your finger down anywhere, North, South, East, West, and somebody will be doing it there, right then and there, under your finger, whatever the time of day or night, whatever the season, somebody will be praying. Alone in an amphitheaters, in tears or with laughter, in reverential stillness or with song and dance, with heads bowed or faces raised to the heavens, it is a universal act with no universal language, no universal posture, no universal face, no universal faith. I rarely think this much about prayer. No doubt I'm doing it now in part because of the season, and hymns and angels abound, and in part, because of all the renewed haggling over the issue of school prayer. But prayer seems to me bigger and wider and more hopeful, more human, and more elemental than all of the haggling we'll inevitably do about it in the coming months. At least, that's what occurs to me in my Christmas sentimentality. [AVE MARIA IN BACKGROUND] I hear Ave Maria or the Gregorian chants I so love and see the spill of supplicants all over the world, those who celebrate Christmas and those who do not -- in churches, yes, but in mosques, and synagogues and temples -- and I confess to a pronounced spiritual shiver that transcends individual faiths. Although I am not, per se, religious, I, like millions of others, put in my time on a hard wooden Presbyterian pew as a small girl in hat and gloves and later moved away from any organized church. But all through the years, like many people who have no formal faith, I have importuned somebody or something for help or forgiveness. Perhaps I'm just calling on some higher power, as they say in the 12-step world. Or perhaps, I'm just importuning my own better self to be kinder, wiser, stronger. Is this not prayer? Some I know would say no. But who are any of us to judge the worth of another's prayer, it's contours, its piety? After all, Muslims, Buddhists, Catholics, Jews, and Protestants, and all the sects and denominations within, they all have their own prayers. It is the act that is shared. By the act, itself, they are joined not only to each other but to all who have gone before, all of our kind who have prayed to this God or that, prayed for rain and sun, for children to be born, and loved ones not to die, for victory or humility or the release from grief, a long lineage of the marrying and burying and mourning and celebrating, all colors and creeds and races throughout history, all of us asking for failures, asking for forgiveness, asking that we not be alone here, please. In that sense, prayer is too big and too small, too private and too universal to be owned by anyone. In my hometown of Los Angeles, people from 140 different countries live together. Prayers come in all those languages and all their attendant faiths. And it is the extraordinary gift of my country that all those faiths are tolerated and welcomed and that no one prayer is the official prayer, even now during Christmastime. I'm Anne Taylor Fleming. RECAP

MR. MAC NEIL: Again, the major story of this Monday, police stormed a hijacked Air France jet liner in Marseilles after the terrorists murdered a fourth passenger. All four of the Islamic hijackers were killed. Nearly 170 passengers were rescued. That's the NewsHour for tonight. We'll be back tomorrow night. I'm Robert MacNeil. Good night.