The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight, Energy Secretary Richardson and Senate Intelligence Committee Chairman Shelby discuss the China nuclear spying story. Susan Dentzer looks at the effectiveness of flu shots. Haynes Johnson, Michael Beschloss, Doris Kearns Goodwin, and Herb Stein observe the new world of budget surpluses. And Poet Laureate Robert Pinsky recites some snow poetry. It all follows our summary of the news this Tuesday.

NEWS SUMMARY

JIM LEHRER: The Clinton administration today rejected blame for stolen U.S. nuclear secrets. Vice President Gore said the alleged theft by China occurred during previous Republican administrations. At the State Department, Spokesman James Rubin said this:

JAMES RUBIN, State Department Spokesman: Let's bear in mind that this espionage took place in the 1980's. Our first step was to evaluate the extent of Chinese espionage at U.S. nuclear labs and its implications for Chinese nuclear weapons capabilities. Even though it is difficult to resolve these issues, we determined that the threat was serious enough to warrant immediate action. In response, the administration intensified investigation of possible espionage cases and strengthened security at their labs.

JIM LEHRER: Senate Majority Leader Lott said the Senate Intelligence Committee would be holding hearings on this matter.

SEN. TRENT LOTT, Majority Leader: The real issue here is why don't we have protections in place? How can this be allowed to happen? I understand that there - you know -- suspicion that there are others. So these lax rules and failure to really protect this important technology has got to be dealt with. I'm not going to dwell so much on the past. What I want to know is what we're going to do about correcting this problem.

JIM LEHRER: On Monday, a Chinese-American scientist at the Los Alamos Nuclear Laboratory in New Mexico was fired for violating security procedures. He's suspected of helping China acquire nuclear weapons secrets. He has not been arrested or charged with a crime. China's foreign ministry in Beijing called the charges unfounded. We'll have more on the story right after the News Summary. Output by American workers increased at its highest rate in six years at the end of last year, the Labor Department reported today. It said productivity went up at an annual rate of 4.6 percent in the October-through-December quarter of 1998. For all of last year, it advanced 2.2 percent. R.J.R. Nabisco announced a major breakup of its holdings today. It will sell its internationaltobacco business to a Japanese firm for $8 billion and separate its food and domestic tobacco interests. Some shareholders had been requesting that division. They argued the stock market was undervaluing food operations, fearing they'd be hurt by potential tobacco liabilities. Amtrak today announced the first high-speed train service in the United States. The new passenger trains will go 150 miles an hour and travel along Amtrak's 470-mile Northeast corridor. Trips from New York to Washington, DC, and to Boston will each take about two and a half to three hours. Fares will be priced lower than airline shuttles. The trains are to start running in October. The project cost $2 billion. In Nashville today, Former Tennessee Governor Lamar Alexander made his second bid for the Republican presidential nomination. He ran unsuccessfully in '96. He spoke to supporters at the Tennessee State Capitol.

LAMAR ALEXANDER: I'm ready to help our country face the challenges of a new century and to make the right choices. This election will be about the character of our nation and its institutions. This election will be about restoring respect to the presidency. But most of all, this election will be about raising our standards and bringing out the very best in our country because that is what it will take to create a second great American century.

JIM LEHRER: Alexander is the third Republican to formally launch a presidential candidacy. Television Commentator Pat Buchanan did so last week. New Hampshire Senator Bob Smith did it in February. And that's it for the News Summary tonight. Now it's on to the China nuclear spying story, a flu shots update, some budget surplus history, and a snow poem.

FOCUS - NUCLEAR ESPIONAGE

JIM LEHRER: The China story, and the controversy over security at America's top nuclear weapons lab. A scientist was fired there Monday. He's under suspicion for passing secrets to China. We go to Energy Secretary Bill Richardson, who did the firing, and to the Chairman of the Senate Intelligence Committee, Senator Richard Shelby, Republican of Alabama. Mr. Secretary, what exactly did the scientist do to be fired?

BILL RICHARDSON, Secretary of Energy: He did three things, Jim. First, he violated security procedures at the lab by having unauthorized contacts with sensitive countries. He violated handling of classified material, and he failed to inform the lab of a number of security breaches that he committed. On the basis of those violations, I felt incumbent upon firing him in addition to suspicions we had about his involvement with this incident. In addition to that, he failed a polygraph test. So I felt I had sufficient grounds to dismiss him.

JIM LEHRER: Now, were these things that he allegedly did, did they happen recently? Or some of these things that happened in the 1980's? When did this happen in other words?

BILL RICHARDSON: Jim, there's a lot of law enforcement issues that I have to be careful of. But we found some of these violations to have happened in the 80's in 1995. And the FBI very vigorously and I believe effectively with our own people at Los Alamos have been building up an analysis of what has been lost, have been building up a case against this individual to be absolutely sure that this was the one that we felt was suspicious. And what was developed, Jim, was then a requirement that President Clinton instituted in April of 1998 to set up a vigorous counterintelligency effort at the national labs. That has happened.

JIM LEHRER: Now, is he going to be charged with a crime?

BILL RICHARDSON: That's an FBI issue, Jim, a law enforcement matter. There are a lot of legal issues involved. But you will recall that in our past spy cases where the FBI has had prime responsibility, there is a time lag between a dismissal, Aldrich Ames, Nicholson, Howard and attempted arrests. So we are now at a stage that a case is being developed. But this is really an FBI Issue. I took my responsibilities as my employee to fire him because I felt there were sufficient grounds to terminate him. But the FBI had advised me to hold on, not fire him -- I had wanted to do this for some time -- until they developed a strong case, a strong rationale. They interviewed him over the weekend. This individual was totally non-cooperative, he was defiant. I felt on that basis and for the reasons we outlined that I should fire him.

JIM LEHRER: He's an American citizen?

BILL RICHARDSON: Yes, he's a Taiwanese-born American citizen.

JIM LEHRER: Is he in custody or in any way restrained in his movements?

BILL RICHARDSON: No, he's not, Jim. He's been terminated from his position but he is not in custody. He is in New Mexico; he is in Los Alamos.

JIM LEHRER: Is there any evidence he's part of a ring of some kind, a larger group? Or was he acting alone?

BILL RICHARDSON: We think he's acting alone. We think that this is the only incident. But that doesn't mean that we don't remain vigilant. And what we have done since I came on board is we've instituted polygraphs for anybody that has sensitive access; we've brought the visitor's program of foreign scientists very, very tight security procedures. We've doubled the counterintelligence budget for the Department. We have counterintelligence people at each of the labs. We have had background checks on every scientist that comes in from sensitive countries. They all are accompanied, any foreign scientist that comes in. But the purpose, Jim, of having foreign scientists at our labs -- and they are from many friendly companies, too - is we want to teach them about nuclear nonproliferation, about export controls, about dual-use technology, about safety of warheads. It's in our interest to have countries from -- represented like Russia and China and others learn restraint about nuclear weapons. And our labs are the best at this. That doesn't mean you have weak security procedures. But we don't anymore. We have tightened substantially, even to the point where I think we're the only agency besides CIA that is having polygraphs on employees.

JIM LEHRER: All right, Senator Shelby, what do you think of the way Secretary Richardson and others in the Clinton administration have handled this matter?

SEN. RICHARD SHELBY, Chairman, Senate Intelligence Committee: Well, let's talk about Secretary Richardson. I believe that what he's doing and what he has just done is a step in the right direction. I also believe that lab security has been very lax over the years, probably an academic atmosphere, and perhaps an academic attitude. Now, there's nothing bad about that except the weapon labs, such as Los Alamos, such as Livermore and others, house and will continue to house our best-kept secrets -- some of them in the world. I think we have to tighten up security there. We've got to do it, and we've got to make sure that it is implemented. Secretary Richardson talked about what they were doing, and I commend him for this. But on the Intelligence Committee, which we have oversight jurisdiction of our national security and our agencies and our intelligent gathering agencies, we want to make sure that this doesn't happy in the future. There's always a chance that this could be a tip of an iceberg, that this is not an isolated case. I hope it is. But we don't know that yet. And that's why I've called for hearings regarding this incident and others like it at the labs next Wednesday in the Senate -- on the Senate Intelligence Committee. And we'll start off with Secretary Richardson and FBI Director Louis Freeh and go from there because this is important. It's important to the American people. When we lose, if all this is true, if we lose weapons knowledge to someone who is way behind us, they catch up fast. There's a quantum leap. The American taxpayers pay for it. Our children could pay for it dearly. National security should not be for rent, for sale or anything to look the other way. And so I'm going to, as Chairman of the Intelligence Committee, going to work with Secretary Richardson and others to make sure that our lab security is tightened up. It has to be. There's no excuse not for it to be. But it has been lax in the past.

JIM LEHRER: And why do you say that? I mean, anything beyond this one incident? Have there been other incidents that you know about?

SEN. RICHARD SHELBY: Well, I can't comment on everything here.

JIM LEHRER: Sure.

SEN. RICHARD SHELBY: We'll just comment on the firing yesterday and what Secretary Richardson said. But I think there's been an atmosphere and not just in the Clinton administration. We have to go back in context. But it took a while to fire this man, and it took a while to implement policies. The main thing is we've got to continue to do this. We've got to be vigilant. I don't believe we have been vigilant enough at our weapons labs.

JIM LEHRER: Do you believe, Senator Shelby - I mean, is there any question in your mind this operation involving this one man, if it only involved one man, directly involved also the Government of China?

SEN. RICHARD SHELBY: Well, I wouldn't go that far except at this point, and not on a TV program, except to say that we've got to protect ourselves against nations in the world that would acquire any way they could our technology that could do damage to our national security, our ascendancy in the world. We have to protect that ought all costs.

JIM LEHRER: Secretary Richardson, how would you answer the same question? Is the Chinese Government involved in this one man's operations?

BILL RICHARDSON: We have no evidence yet, Jim, that -- how serious this breach was. It is serious. We do think that it involves espionage.

JIM LEHRER: Like what? What kind of espionage?

BILL RICHARDSON: Well, it's a law enforcement issue, but we did nail this guy because we felt he was passing on unauthorized information. Now, I don't want to get beyond that. It did involve China. But let me also say that we don't know yet how serious the damage was. There's varying assessments, CIA, Energy Department, about how serious the breach was. We're trying to find that out. We will find it out soon. We're going to cooperate fully with Senator Shelby. I do agree with one his comments. In the past lab security should have been tougher. There's no question about it -- in the 80's, perhaps in the 90's. But, Jim, these labs do great work. They're taking a hit now but they develop nuclear weapons, they've got our best scientists, they guard our weapons, they make sure we can have a strong stewardship program without testing. They do outstanding work. This is one incident, a serious one. But I don't want to diminish the very important national security role of our weapons labs.

JIM LEHRER: Senator Shelby, what is your assessment a as to why the security guy -- you said it was an academic atmosphere. But why was there no oversight in the prior administrations, as well as this one, if you think there wasn't, or even in the Congress?

SEN. RICHARD SHELBY: Well, I'm sure there's been oversight but there hasn't been enough. I don't believe, Jim, that security in our labs has been the priority that it should have been perhaps in past years. And I think part of it is a lot of the openness has come about since the demise of the Soviet Union -- perhaps even before this. And as Secretary Richardson said, there is a big exchange around the world of scientists and scientific information. But we've got to guard very diligently against leaking or letting it be stolen from our labs that would do damage to our national security. This is a big issue. And I believe after the total assessment is made there, you're going to see, I predict, a big loss of technology.

JIM LEHRER: I was going to ask you about that. I know you can't tell us what it is, and I wouldn't even ask you to but I mean, you say a big loss, there's no question in your mind that this incident involved something of high magnitude to the United States?

SEN. RICHARD SHELBY: I do. I do believe that. And as time goes on, I believe that that will get in the public domain.

JIM LEHRER: Do you know something that Secretary Richardson doesn't know or -

SEN. RICHARD SHELBY: Well, I don't know. I might. I might not. But that's not just my interpretation.

BILL RICHARDSON: Jim, I think the answer to that is we don't know yet. After this assessment that the CIA is doing soon about how serious the damage was, we will know that answer. It was serious, it's unconscionable that it happened. We don't tolerate espionage from anybody, the Chinese, this is very serious. But the full extent should come out after proper declassification. But I think Senator Shelby's inquest is a correct one. We're going to cooperate fully. He's been bipartisan. We're going to testify along with Director Freeh. And I think it's important that we resolve this issue in a bipartisan manner because this is national security. There's plenty of blame to go around. The point is, Jim, we have taken some very strong steps to ensure that this doesn't happen again. And I don't think it can anymore with what we have in store. But we're willing to listen to your recommendations.

SEN. RICHARD SHELBY: Jim, I don't believe there's any substitute for lack of diligence, no matter who the administration is, whether it's the Clinton administration, the Bush administration, the Reagan administration, and so forth. Our national security should be, must be, above political parties, political considerations.

JIM LEHRER: And finally, Senator Shelby, this man has been fired. You're going to hold hearings next week. What about a criminal prosecution if, in fact, there was espionage?

SEN. RICHARD SHELBY: That ultimately will be up to the FBI and the Justice Department. But I do know that sometimes it takes a long time to crack an espionage case, to bring it to trial. They're very difficult. They're very tough.

JIM LEHRER: So it doesn't trouble you that this man has not been arrested.

SEN. RICHARD SHELBY: No, not yet. But I would hope he would be in the future if they've got enough evidence.

JIM LEHRER: All right, gentlemen, thank you both very much.

SEN. RICHARD SHELBY: Thank you.

UPDATE - FIGHTING THE FLU

JIM LEHRER: The flu shot story is from Susan Dentzer of our health unit, a partnership with the Henry J. Kaiser Family Foundation.

SUSAN DENTZER: Influenza, known as the flu, afflicts millions each winter, causing symptoms like chills, fever, a dry cough, muscle aches, and fatigue. Although most people recover within several days to two weeks, the flu remains a serious public health problem, and one that is arguably getting worse.

HEALTH CARE WORKER: Let me take a real quick look here.

SUSAN DENTZER: Between 10 and 30 percent of the population gets the flu each year, as new strains of influenza viruses emerge. About 130,000 Americans are hospitalized, and as many as 30,000 die of it. An estimated 10,000 or more also die of flu complications, such as pneumonia. Although the flu hits almost everybody, particularly school-age children, it can be especially dangerous to people with chronic illnesses, like emphysema and HIV, and it can be deadly to the elderly. More than 90 percent of influenza-related deaths occur in people over 65.

HEALTH CARE WORKER: Now, you've had flu shots before?

PERSON GETTING SHOT: Yes.

SUSAN DENTZER: The best way to avoid becoming ill is to get a flu shot before flu season begins each fall. The vaccines must be administered annually, since they are designed to attack the strains of virus likely to circulate each flu season. Their effectiveness is underscored by a new study in this week's issue of the "Journal of the American Medical Association." Researchers looked at health care workers who received flu vaccines and those who did not. Dr. James Wilde was the study's lead author.

DR. JAMES WILDE: We found an 88 to 89 percent reduction in influenza among the health care workers who had received the influenza vaccine.

SUSAN DENTZER: Despite the vaccine's effectiveness, only about a third of Americans at high risk of dying from the flu get an annual shot, so an editorial in the journal called for a massive national effort to encourage vaccinations by making the shots more available at places like pharmacies and schools.

JIM LEHRER: Susan Dentzer is now with Phil Ponce.

PHIL PONCE: Susan, first of all, a point of basic information, the flu is a term people throw around pretty freely. What exactly is the flu?

SUSAN DENTZER: The flu, Phil, is a viral infection that's caused by the influenza virus, which comes in three forms, known as Types A, B and C. The ones we really care about are Type A and B. Those tend to cause the large disease outbreaks, the epidemics that we've become familiar with. As we said in the piece, the symptoms are familiar. You start off, you tend to start off with a dry cough, a headache. That evolves quickly to fever and chill - chills, rather, leading to fever. Then you get something a couple days later that seems pretty much like a cold, nasal congestion, coughing again. You tend to get a lot of muscle weakness, muscle fatigue, and you can feel that for as much as a week to two weeks after the rest of your symptoms disappear.

PHIL PONCE: And how do you know you don't have a bad cold as opposed to the flu?

SUSAN DENTZER: Well, you might not really know. But the key signs are going to be, first of all, how it starts off with a headache and the dry cough. That's usually a giveaway. A cold doesn't necessarily start that way. And your fever is going to be a tip-off as well, because a cold fever isn't going to hang around the way a flu fever will hang around you for a couple of days.

PHIL PONCE: Susan, this study in the Journal of the American Medical Association dealt with young health professionals and how effective the vaccine was in that group. But across the board, how effective are these flu vaccines?

SUSAN DENTZER: There's a broad range of fact in this. For some individuals, that is to say sickly, bed-bound older persons, it may reduce the incidence as little as 30 percent, the degree of effectiveness is much lower than in the case of the health care professionals, where, as we said, it's almost 90 percent. But it's important to note what we're talking about here. That's preventing the flu. It is very clear that in terms of keeping you out of the hospital and preventing the very high-risk kind of things that can accompany flu, secondary infections, such as pneumonia, and preventing you from dying, the flu vaccine is generally much more effective. And there the effectiveness rates, that is to say eliminating that possibility is upwards of 70 percent for many, many more individuals.

PHIL PONCE: So is it fair to say a flu vaccine can't hurt you but it might help you?

SUSAN DENTZER: It can't hurt you, might help you, and it almost certainly is going to increase the odds that your life will be saved, you will not die of the flu over the secondary infection related to the flu.

PHIL PONCE: Segment, without making the segment too personal, we had a staff meeting yesterday and Jim asked for a show of hand for a show of people who had gotten a flu vaccine. And every person in the room, about 12 of us, raised our hands and he asked how many have gotten the flu, about six of us raised our hands. Explain that.

SUSAN DENTZER: Well, for one thing, you all may not have gotten the flu, you may have gotten something else, a very bad cold, another kind of a virus, known as RSV, which can mimic a lot of the symptoms that a lot of people confuse with the flu.

PHIL PONCE: RSV, what does that stand for?

SUSAN DENTZER: Respiratory Sincial Virus, which is another very widespread virus, particularly among children.

PHIL PONCE: So when I went to the doctor and he said I had an acute viral infection, what did that mean? Did that mean I had the flu, even though I got a flu vaccine?

SUSAN DENTZER: It meant that you had a virus that caused a lot of havoc in your body and that the doctor did not go on to make sure that that was an influenza virus. So, it's quite likely that you had some other kind of virus. You may, indeed, have gotten the flu, you can't rule that out. But it's quite likely and particularly, for example, last year when the flu virus - the flu vaccine was made, the actual variant of the virus that ended up causing most of the flu outbreak in the United States last year turned out not to have been captured in the vaccine. That did not appear to have happened this year but that does happen from year to year. So it may be that you get a vaccine and it wasn't necessarily targeted to the variant of the virus that caused the flu in that given year.

PHIL PONCE: So a flu vaccine can care vary in effectiveness from year to year because every year flu viruses can mutate and come up with new variations that the existing vaccines weren't manufactured to address?

SUSAN DENTZER: That's right. And that's why there is in place a global surveillance network to find out as early as possible what variants are likely to be prevalent in the coming flu season.

PHIL PONCE: Susan, across the general population, how many people get flu vaccines?

SUSAN DENTZER: In the United States about 75 million people. So, it's a little bit more than a third of the population. The concern now, as we said in the piece, is that many of the people who are at high risk for getting the flu and having serious complications or dying of it are not getting it. 65 percent of the elderly fortunately are now getting the flu vaccine. That's a dramatic increase from recent years. And hopefully it will continue to go upward. But if you look at the next younger group of people, say people age 50 to 64, many of whom who are starting to have chronic diseases like diabetes and other things that would be indications of a need to get flu vaccine, that group of people is not getting the flu vaccine to the degree it should, as is the case with many young children. Very young children should probably get the flu vaccine because they can have worse cases than slightly older children and others who may have compromised immune systems, such as with HIV and so on. So there's a large group of people who need to get the virus - who need to get the vaccine who are not getting it.

PHIL PONCE: Well, Susan, why is it if the evidence show it is can help you, why is it more people are not getting the flu vaccine?

SUSAN DENTZER: Some people are afraid. Some people are afraid that they're going to get the flu from the flu vaccine. Some people think that they're going to get very bad serious side effects, whereas we know that probably the worst side effect you're going to get is a sore arm, sore at the site of the vaccination spot, for one to two days. And I think -

PHIL PONCE: But you can't actually get the flu from getting a flu vaccine? That's a myth.

SUSAN DENTZER: You cannot get the flu. Many people apparently retain memories of older generations of flu vaccines that were not so pure and you could get some worse side effects than is the case now but also people just don't understand how much their risk could be reduced and the risk in some cases of very serious illness and death.

PHIL PONCE: And real quickly, things that are in the pipeline, drugs or vaccines that maybe are improvements?

SUSAN DENTZER: Yes. Happily enough to say, there is a possibility in the next couple of years there will be on the market something known as flu mist vaccine, which actually is a vaccine that is made of live -- attenuated live viruses. It sounds scary to say, but, in fact, what this is, is viruses that, in effect, could be more effective in terms of a vaccine of preventing you from getting the flu. Also, these would be administered through a nasal spray. So, in effect, it would mimic getting the real flu. You'd get a live virus, you'd get it through your nose, which is how you tend to get flu virus in the first place, and it's thought that this will be more effective in preventing flu. We'll see if it comes on the market and if it has in fact that effect.

PHIL PONCE: Did you get a flu shot?

SUSAN DENTZER: Of course.

PHIL PONCE: Did you get the flu?

SUSAN DENTZER: No.

PHIL PONCE: Lucky, Susan. Thank you.

SUSAN DENTZER: Thanks, Phil.

JIM LEHRER: Still to come on the NewsHour tonight, some perspective on the budget surplus, and some poetry about snow.

FOCUS - BRAVE NEW WORLD

JIM LEHRER: The new world of surplus: Kwame Holman begins.

KWAME HOLMAN: When the Balanced Budget Agreement was signed into law in the summer of 1997, an ever- improving economy already was driving down annual federal deficits. In fact, within a few months, the President and members of Congress actually began discussing what to do with a budget surplus. Still, this moment was historic, because it formally ended the Federal Government's long-standing practice of spending more money than it takes in. The Balanced Budget Agreement was designed to end nearly 30 years of deficit spending, a streak that began quietly during Richard Nixon's second year in office. But by 1982, Ronald Reagan's second year in office, the federal deficit reached $128 billion. By 1985, it topped $200 billion. And so, Congress passed and the President signed a deficit reduction bill named for its sponsors, Senators Gramm, Rudman, and Hollings. Its aim was to zero out deficits by 1991. What it also did was increase partisan tensions on Capitol Hill.

REP. WILLIAM GRAY, Chairman, Budget Committee: [1987] We have met the Gramm-Rudman target by $200 million more than the President. These assumptions will show that we have reduced the deficit more than the President. In fact, our deficit reduction is stronger than the President's under any set of assumptions.

REP. DILBERT LATTA, [R] Ohio: It sounds to me, in listening to your comments, this is a real April Fool document. It's a typical Democrat document. You promise everything to everybody, and at the same time say you're going to reduce the deficit. And I just don't think that's going to work. I think it's another tax-and-spend, and tax-and-spend-and-whack defense budget.

KWAME HOLMAN: Ultimately, Congress couldn't meet its Gramm-Rudman deficit targets, so it simply set new, higher targets, and the deficit continued to climb. In 1990, President George Bush reluctantly broke his campaign pledge and agreed to use tax increases, along with spending cuts, in hopes of reaching a balanced budget within five years.

PRESIDENT GEORGE BUSH: When you get into somebody's pocketbook, or you get worrying about a tax or a spending cut that affects someone, I've learned that it's just not going to be done the way I want it, especially if you don't control the Senate or you don't control the House.

KWAME HOLMAN: But again, a partisan budget battle ensued.

REP. DAN BURTON: [1990] Hundreds of thousands of people will lose their jobs and it will be on our heads. We don't need a tax increase folks, we need to cut spending.

REP. LEON PANETTA: Is it perfect? Far from it. Is it painful? With half a trillion dollars in deficit reduction, how could it not be? Is it the package that I or any of you would have designed, or, for that matter, the President? Absolutely not. Of course not. It's a compromise.

KWAME HOLMAN: However, the deficits continued to mount, reaching $290 billion in 1992. That, and a slumping economy, contributed to President's Bush defeat in his bid for reelection. A year later, President Clinton's own plan for tax increases and spending cuts made it through Congress with Democratic support alone. At the moment the bill passed some House Republicans mockingly waved good-bye to Democrats, predicting they would suffer at the polls for their vote. One year later, Democrats lost majorities in both Houses of Congress.

VICE PRESIDENT GORE: President Bill Clinton.

KWAME HOLMAN: When he released his year 2000 budget a few weeks ago, President Clinton recalled the 1993 vote and recognized one member of Congress in particular.

PRESIDENT CLINTON: Congressman Jay Inslee from Washington is one of the people who lost his seat in 1994, in no small measure because he voted for the economic plan of 1993. And in 1998, the voters in Washington returned him to the House of Representatives, and I'm delighted to see him. Thank you, sir. Stand up. [Applause] Thank you.

KWAME HOLMAN: On numerous occasions, President Clinton also has credited the '93 vote with helping turn around an economy that eventually began producing more tax revenue than expected for the Federal Government. That further reduced the deficit, and helped ensure the President's reelection in 1996. Republicans, too, take some credit for the economic turnaround, citing the spending limits they installed once they took control of the Congress.

REP. JOHN KASICH, Chairman, Budget Committee: [1996] We have saved more money in the first 17 months, standing on principle and fighting for our goals in the first 17 months, saving $23 billion more than any Congress since World War II, and that is just terrific.

KWAME HOLMAN: Annual federal deficits no longer are on the books, but the national debt is. That's the accumulated damage from running deficits year after year. How Congress and the President intend to deal with that is the subject of a new budget debate in Washington.

JIM LEHRER: And Margaret Warner takes it from there.

MARGARET WARNER: Some perspective now on what this shift from a deficit to a surplus era may mean. It comes from three NewsHour regulars: Presidential Historians Doris Kearns Goodwin and Michael Beschloss, and Journalist and Author Haynes Johnson. Joining them tonight is Herbert Stein, Senior Fellow at the American Enterprise Institute and Former Chairman of the Council of Economic Advisors during the Nixon and Ford administrations. Welcome all.

MARGARET WARNER: Mr. Stein, put this in context for us, an even longer historical context than Kwame just gave us, in terms of moving into at least some kind of an era of surplus. How big a change is this?

HERBERT STEIN, Nixon/Ford Economic Adviser: Well, if you look back at our history a long way, it's not such an unusual situation. After the Civil War for 50 years or more, back down to 1915, we gradually reduced the debt, we ran surpluses on the average, and we reduced the debt from about 30 percent of the national income to about 3 percent. Then we had another surge of deficit spending during World War I and we went through another decade after that of debt reduction -- and deficit reduction -- surpluses and debt reduction. Even after World War II when the debt was up to over 100 percent of the national income, although we ran deficits for a while, they were very small. And the ratio of the debt to the national income declined from over 100 percent to about 25 percent in 1974, which was coincidentally the last year of my service in the government. Since then it has increased a great deal to about 50 percent. But -- so this is not a unique situation that we should have some surpluses. In olden days it would have been considered natural that after a period in which you ran big deficits, you would then run some surpluses.

MARGARET WARNER: So Doris, what made it okay, politically okay, to run large deficits and to keep running large deficits?

DORIS KEARNS GOODWIN, Presidential Historian: Well, I'm not sure that it really was politically a popular thing to do. It's just that there were certain kinds of constraints built into the spending side, things that were very popular programs like Medicare, like Social Security, and it was very hard to undo them. So those mandatory spendings kept going year by year, and at the same time it became tough for people to take the courageous stands for tax increases, which they finally took, which is what eventually turned it around partly. Although, I think before we give too much credit to the administration, although I think they deserve some, so do the Republicans, so do the Democrats. As they say, if defeat is an orphan, than success has a thousand fathers, in this case it does, but it seems the big change is the economy's productivity. It's grown 4 percentage points these last years, productivity even higher than that partly due to oil prices being low, partly due to technology, so reaching out over other countries where you've got computers in everybody's hands. Stores - you look at those supermarket scanners, and they can figure out what their inventories are in our country, so they know how to stock. They can thereby make profits without raising prices. So I think we have to give credit to the country and the people as a whole. And that's why after we talk about this longer, I hope those people as a whole get to somehow share in this better than they're doing now.

MARGARET WARNER: Haynes, let's go back to the deficit area, though, just for a couple more minutes. How do you think it shaped our politics? You've been covering this for 30 years. How -- it really dominated our politics, didn't it and our national priorities?

HAYNES JOHNSON, Journalist/Author: Absolutely. And Herb Stein, of course, we could bring him back and he would have solved everything, I think -

MARGARET WARNER: Never would have had the problem in the first place.

HAYNES JOHNSON: We wouldn't have had the problem in the first place - but if you just think about it, when Ronald Reagan, for instance, ran for President, he made his central theme that we were a debt-ridden society. I remember looking down into Congress when he made his first address to the United States Congress on February 18, 1981 and he had this wonderful metaphor. It was about the debt that was going to do us in. And he said, Do you realize we have just almost hit $1 trillion of the national debt - that is, all the money the United States had spent for its wars and the expansion in space in its entire history was about to hit this horrifying level of $1 trillion. He said -- and only Reagan could do this - "Do you know what that means?" He said, "If you had a stack of dollar bills and put 'em end on end it would go 67 miles up to the Moon." Later on, it went to 130 miles by the time he left because the deficit tripled in his -- the national debt, rather, tripled during his administration. And it became the central piece really about this -- how do you spend the national treasure? Do you give it back? If you have a surplus, do you give it back to the people in tax cuts, or do you do something else with it? Do you put it in programs? That's the -- this is --absolutely drives our politics and what we have now in the new era of surpluses, if they are surpluses, and lastly surpluses is going to be that kind of debate over spending or whether to tax, whether to give it back, spend it how? So that's where our politics is. It's going to be there.

HERBERT STEIN: I don't really think that the deficit surplus thing has been important in national politics. It is a clich that every candidate likes to say that the deficit is a terrible thing and I want to balance the budget. But we went on for 50 or 60 years regularly electing people who did not balance the budget, who ran bigger and bigger deficits. I don't think really - I really don't think the American people care much about these accounting matters.

MARGARET WARNER: And let me get Michael Beschloss in here. Michael, many Democratic observers of the Reagan years and even some Republicans said that actually Ronald Reagan meant to drive up these huge deficits because he meant to force very hard choices and reduce the size of government, at least what went for domestic spending. Do you think it did force hard choices for the good?

MICHAEL BESCHLOSS, Presidential Historian: It did to some extent, although I think the greater reason that he ran those deficits was that he wanted to increase the defense budget in a way that would break the Soviet Union, and he felt that was more important than balancing the budget. And that's something that historians may ultimately agree on. But I think Herb Stein is actually not giving enough credit to his own party, the Republicans. Since the early 1930's, people like Herbert Hoover and Alf Landon and the others have all said it should be a paramount goal of American Presidents and the American Congress to balance this budget. That's the argument that they made for 60 years. It was very unpopular during World War II and during the period thereafter. Dwight Eisenhower in the 1950's, especially in the late 1950's was making a huge effort to keep that budget balanced at the cost of an enormous recession that cost the Republicans the Congress in '58 and probably defeated Richard Nixon. It was so popular that deficit spending remain that by the time Richard Nixon became President in 1969, as Herb Stein will remember, he said, "I am a Keynesian; I am someone who is willing to tolerate deficit spending. I think that's not a bad idea." And so what you've seen is that the Republican view of the last 60 years finally triumphed in the 1980's and 1990's, and you now see both Democrats and Republicans, the Republicans and Bill Clinton all saying, "We all agree that a balanced budget should be paramount. We only disagree on how to spend the surplus."

DORIS KEARNS GOODWIN: But I could take the opposite point of view.

MARGARET WARNER: Go ahead, Doris.

DORIS KEARNS GOODWIN: I mean, I think the opposite point of view could be that the Democrats starting with Franklin Roosevelt, who unlike Herbert Hoover understood that a balanced economy was not the end, a balanced budget the end in itself, even though he believed in it fiscally, when he came into the Depression, and he saw the needs of people, the human needs of people who were out of jobs losing their homes, he was willing to unbalance the budget to meet those human needs. And then, as his administration went on, he recognized even when the war came that if you somehow used Government spending for the GI Bill of Rights, to protect labor, to do the minimum wage, for Social Security, you'd invest in your people, and the people would be what make that economy grow. And I think you could still argue today that in the 60's when the Democrats were in power and that economy grew at that time, it was partly because the Government invested in its people. And the risk I think we're running now is if we make the surplus and a balanced budget an end in itself and we don't invest in our people once more, in the infrastructure, in education, then the economy is not going to grow in the long run. The balanced budget is helping it in the short run now, but it's not an end in itself. We've had plenty of other times when it wasn't balanced and we did just fine.

MARGARET WARNER: Haynes, do you think we have any reason to expect the parties, though, to have a different view about what to do with the surplus than they did what to do in a time of deficit? In other words, last year we still heard, the first year of a budget surplus, we heard Republicans talking about tax cuts and Democrats talking about some additional domestic spending.

HAYNES JOHNSON: You asked about the issue as a political issue in our debate. Michael talked about the last 60 years and he's correct. If you remember, during the Roosevelt period that Doris talked about, Harry Hopkins, Roosevelt's chief aide in the New Deal period, and chief operative, issued this famous or made a famous statement. It may have been mythological, but it became part of political lore, we will tax and tax, spend and spend, and elect and elect. Republicans ran against that kind of idea for the entire period of the New Deal and on well into the 50's, 60's, 70's and 80's. And whether it was false or not, that framed an issue, the Democrats were the taxers and the spenders. The Republicans were the party of thrift and frugality and balancing budgets. Now, the reality economically may be entirely something else but that' still is the kind of issue you're hearing debated. Today in the House and Senate the Republicans are talking about how to get back a tax cut to the Americans, and the Democrats are saying, no, we want to save it, preserve it for Social Security and Medicare. That's the kind of debate that we're going to have; we've had it really for decades.

MARGARET WARNER: So do you think -- go ahead, Herb Stein. I'm wondering whether you think the politics are going to change in this era of surplus.

HERBERT STEIN: Well, I think that the division will be as Haynes said, that is, that there will be great demand on the Republican side for cutting taxes, there will be some demand on the Democratic side for increasing spending. But I think in looking at this history, we've overlooked some important things. The main reason we got to the surplus was that defense spending went down, interest on the debt went down partly because interest rates went down, and revenue went up partly because the economy was thriving. And so it became easy. It was not a hard job in those circumstances to develop a surplus. Now the test for us is going to be whether having the surplus in our hands we're going to disburse it with tax cuts on the one hand or expenditure increases on the other hand, or going to reduce the debt. But I don't think either side is especially more committed to reducing the debt than the other one.

MARGARET WARNER: Let me get Michael in here for a last word. How do you think the politics of surplus are going to be different - if at all - from the politics of deficit?

MICHAEL BESCHLOSS: Well, you know, it doesn't really cut between the two parties the way that it used to because what you'd expect would be that the Republicans would be sort of like Eisenhower in the 1950's saying let's use this in the most conservative way possible, perhaps to reduce the debt -- certainly not on big federal spending programs. And you would expect the Democrats to do what Doris has suggested, which is to say let's turn on the spigot, let's spend it on health and education, housing, welfare, the city - sort of like LBJ in the 1960's. And the problem is you don't have that debate represented by two parties with opposing views. Both parties are for balanced budgets, and I think one problem is that when you don't have one party making the argument that, yes, in certain times there should be big federal spending, I think our politics is going to be impoverished for it.

MARGARET WARNER: All right. Well, thank you all four very much. We'll see.

FINALLY - THE SNOW MAN

JIM LEHRER: Finally tonight, thoughts of snow: A March storm dumped lots of it on much of the Midwest and East Coast today. Here is NewsHour Contributor Robert Pinsky, Poet Laureate of the United States.

ROBERT PINSKY, Poet Laureate: The best evocation of winter weather that I know is in Wallace Stevens's poem "The Snow Man." Stevens tries to imagine someone cold-minded enough to regard this weather and not think of it in such human terms as "harsh," the wind as "bitter." Only the snow man, he suggests, is cold-minded enough. "The Snow Man." "One must have a mind of winter to regard the frost and the boughs of the pine trees crusted with snow, and have been cold a long time to behold the junipers shagged with ice, the spruces rough in the distant glitter of the January sun, and not to think of any misery in the sound of the wind, in the sound of a few leaves, which is the sound of the land full of the same wind that is blowing in the same bare place for the listener, who listens in the snow, and, nothing himself, beholds nothing that is not there and the nothing that is." I wish you a cozy winter evening.

RECAP

JIM LEHRER: Again, the major story of this Tuesday was the alleged theft of nuclear weapons secrets by China. Energy Secretary Richardson and Senate Intelligence Committee Chairman Shelby appeared on the "NewsHour" tonight. Shelby predicted an investigation will show a dangerous loss of U.S. technology. Richardson said he was not sure how significant the security breach was; both agreed security at nuclear labs has been lax and must be improved. We'll see you online, and again here tomorrow evening. I'm Jim Lehrer. Thank you and good night.