The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight three former U.N. weapons inspectors assess the new arrangement in Iraq; Paul Solman tells the story of silver; Senators McConnell and Lieberman debate campaign finance reform; and Poet Laureate Robert Pinsky pays tribute to the late Barbara Jordan. It all follows our summary of the news this Wednesday. NEWS SUMMARY

JIM LEHRER: President Clinton toured the tornado-hit area of Central Florida today. He saw the area by helicopter and then visited a mobile home park near Orlando, where he consoled those who suffered losses in Monday's storms. He declared nearly three dozen counties federal disaster areas to give victims access to low-cost loans and grants.

PRESIDENT CLINTON: All over this country your fellow Americans are praying for you and pulling for you, and what it is within our power to do to help you return to normal lives we will do. I have already designated federal assistance to 34 Florida counties affected by the tornadoes. We are also providing today $3 million from the Department of Labor for temporary jobs for workers to assist in disaster recovery work so that we can complete it more quickly.

JIM LEHRER: In California today bulldozers pushed aside mounds of mud deposited by two days of powerful El Nino storms. Eight people died; hundreds have left homes threatened by mudslides and crumbling coastlines. Engineers rushed to cut this San Francisco home in half to save at least part of it when the water-logged bank gives way. A series of back-to-back storms have been blamed for $475 million in damage. More than half the state's counties are disaster areas. On the Iraq story today Senate Majority Leader Trent Lott denounced the deal negotiated by U.N. Secretary- General Kofi Annan. He said it does not adequately address the threats posed by Iraq President Saddam Hussein and may jeopardize the work of the U.N. special commission that oversees the inspections.

SEN. TRENT LOTT, Majority Leader: The secretary-general, I fear, has harmed the credibility of the United Nations by cutting what appears to be a special deal with the most flagrant violator of United Nations resolutions probably in history. Instead of standing on principle, he sat with the unprincipled and gave him what he wanted. The United States has not yet formally announced its support for the deal negotiated by Secretary-General Annan. It is not too late to reject a deal if it leaves Saddam Hussein rejoicing and leaves UNSCOM out in the cold.

JIM LEHRER: Secretary of State Albright replied to Lott, following a House committee hearing.

MADELEINE ALBRIGHT, Secretary of State: This is not a time to bash the United Nations. This is a time to understand that this agreement is a useful one that needs to have some clarification. It is important for us to test what the secretary-general brought back. That is what we're going to do, and I think it is--I just have to say that in no way has the United States given away anything.

JIM LEHRER: A Pentagon official said today the U.S. military build-up in the region has cost more than $600 million. We'll have more on the Iraq story right after this News Summary. The U.S. Supreme Court ruled in favor of the banking industry today. A majority said federal credit unions should not be allowed to enroll depositors from outside their traditional membership pools. A 16-year-old federal policy let them do so. Today's five to four vote struck that down on grounds credit union members should have a common bond, such as the same workplace. The Senate was expected to vote this evening on another motion to kill campaign finance legislation. Yesterday the Senate rejected a similar move to kill the McCain-Feingold bill. Tonight's vote was also expected to fail. But tomorrow the Senate is scheduled to vote to end debate on the measure. We'll have more on this story later in the program. On the Starr investigation story today the Clinton administration said it was in ongoing discussions aimed at averting an executive privilege showdown with independent counsel Kenneth Starr. The issue is whether certain top presidential aides can be forced to testify before Starr's grand jury. At the U.S. courthouse in Washington today a former personnel aide to President Clinton testified before the grand jury for two and a half hours. Patsy Thomasson spoke to reporters afterward.

PATSY THOMASSON, Former White House Aide: I was subpoenaed to come here by the Office of the Independent Counsel to discuss the placement of Monica Lewinsky in her job at the Pentagon, among other things. I had nothing to offer them, except the facts about her placement there. I absolutely had nothing to offer about any relationship with regard to Monica Lewinsky and the President. Thank you.

JIM LEHRER: South Korea inaugurated a new president today. Betty Ann Bowser narrates our report.

BETTY ANN BOWSER: A trumpet fanfare signaled the arrival of South Korea's 15th president, Kim Dae-Jung. Some 45,000 people attended the ceremony in front of the National Assembly Building. It was the first peaceful transfer of power to an opposition party leader in the country's 50-year history as an independent nation. During that time the 74-year-old Kim was persecuted as a dangerous dissident for his democratic views. In his acceptance speech Kim stressed both democracy and economic reform as the nation's goal. He also called for reconciliation and cooperation with North Korea, suggesting an exchange of envoys and a possible summit meeting. Kim was elected with only 40 percent of the vote, but recent public polls put his approval rating at over 80 percent. He'll need that to win reforms demanded by the International Monetary Fund in exchange for its $57 billion bailout of South Korea's faltering economy in December.

JIM LEHRER: Hours after Kim's inauguration his political opponents blocked the national assembly from ratifying his choice for prime minister. Comedian Henny Youngman died last night in New York City of complications from the flu. He made people laugh for a living for 70 years. Even in his 70's he worked more than 200 shows a year, sometimes in a wheelchair. Henny Youngman was 91 years old. And that's it for the News Summary tonight. Now it's on to weapons inspecting in Iraq, the story of silver, the Senate's campaign finance debate, and a poetic tribute to Barbara Jordan. FOCUS - UNFETTERED ACCESS?

JIM LEHRER: The Iraq weapons inspection program after the Kofi Annan deal. Charles Krause begins.

CHARLES KRAUSE: When Iraq surrendered to allied forces in 1991, it agreed to give United Nations inspectors access to all facilities the U.N. believed capable of producing weapons of mass destruction. A special United Nations commission called UNSCOM was created to carry out the task. Made up of weapons experts from 21 countries, UNSCOM's mandate is to conduct on-site inspections of suspected biological, chemical, and missile sites in Iraq, then destroy them if weapons of mass destruction are found. UNSCOM's findings are reported directly to the United Nations Security Council, and UNSCOM's director is appointed by the U.N.'s secretary-general. Swedish Ambassador Rolf Ekeus was the first UNSCOM director. Last year, he was replaced by Australian Ambassador Richard Butler. UNSCOM inspectors have visited hundreds of sites since 1991. When they discovered these drums of chemical and biological agents outside Baghdad, they ordered the entire complex of buildings destroyed. UNSCOM also uses video cameras to monitor factories and laboratories the Iraqis might try to convert to produce weapons in the future. The Clinton administration has said the UNSCOM mission has accomplished many of its goals.

SAMUEL BERGER: Despite Iraq's best efforts, the inspectors have done a remarkably effective job. They have found and destroyed more of Iraq's weapons ofmass destruction capacity than was destroyed during the entire Gulf War.

CHARLES KRAUSE: But in the report to the Security Council last year, UNSCOM reported that Saddam Hussein still possessed more than 2,000 gallons of the deadly bacteria anthrax; 31,000 chemical weapons; more than 600 tons of material to produce the deadly VX nerve agent; and 4,000 tons of additional material that could be used to produce weapons. Last fall, Saddam Hussein threatened to expel American members of the UNSCOM inspection teams. He also blocked inspectors from going to what he called "sensitive sites," including eight "presidential palaces." But the United States said the palaces were more like military compounds and demanded access to them. As the crisis escalated over the past several months, the U.S. and Britain began a massive military build-up in the Gulf, including three aircraft carriers, threatening a major military assault if Saddam did not back down. Only a last-minute diplomatic agreement brokered this weekend by U.N. Secretary-General Kofi Annan saved Iraq from the threatened military reprisals. Signed by Iraqi Deputy Prime Minister Tariq Aziz and Annan, in the agreement Iraq promises unconditional access to any and all suspected weapons facilities in the country. The accord also provides for a new so-called special group of inspectors, composed of senior diplomats and UNSCOM experts, who will have access to the eight presidential sites. Yesterday, Secretary of State Madeleine Albright assured reporters that UNSCOM will continue to lead all inspection missions.

MADELEINE ALBRIGHT, Secretary of State: It was very important that there be unfettered, unconditional access, and that UNSCOM had operational control, and that UNSCOM, itself, in no way be diminished, and it--we will have to now--it seems to me from the clarifications that I've gotten from the secretary-general that we have accomplished that. But the truth of the matter is we will not know what we have until this is tested.

CHARLES KRAUSE: To test the agreement Albright called for the inspectors to resume their work as soon as possible.

JIM LEHRER: And to Elizabeth Farnsworth in San Francisco.

ELIZABETH FARNSWORTH: We now get three views from men with extensive experience inspecting Iraq. Rolf Ekeus is chairman of the United Nations Special Commission for Iraq. He held that post from 1991 to 1997. He is now Sweden's ambassador to the United States. Raymond Zilinskas was a U.N. biological weapons inspector in 1994. He worked on setting up the long-term monitoring program that is in effect now. He's currently an associate professor at the University of Maryland's Biotechnology Institute. And Jonathan Tucker was a U.N. biological weapons inspector in 1995. He is now the director of the chemical and the biological weapons non-proliferation project at the Monterey Institute of International Studies. Thank you all for being with us.Mr. Ambassador, from what you know about this agreement, will it weaken or strengthen the hand of the inspectors in Iraq?

AMBASSADOR ROLF EKEUS, Former Chief U.N. Weapons Inspector: I think it's a good arrangement we put up. It was clear it compared with the situation before when the inspectors were blocked, definitely the solution brought home by Sec. Annan, Kofi Annan was positive on. It grants the inspectors access any time and anywhere they would like to go, which is decided upon by the UNSCOM chairman, so in a sense, we've come back to the place where we should have been before.

ELIZABETH FARNSWORTH: And, Mr. Ambassador, are you concerned at all that the special group, the way it is set up, to have diplomats part of it, will in any way weaken the procedure?

ROLF EKEUS: The special group is a construction which was arranged to help to deal with presidential palaces, and this is an arrangement which I don't think hamper in any serious way the work of the experts because it is-- group is to be set up by the secretary-general--that is clear, and not by our UNSCOM chairman, which is a difference. But, on the other side, it is assured that the professional people, the specialists, will be--make up the main team and there will be some additional personnel, diplomats and others, who will accompany the team, they will accompany the team, but fundamentally I think it is adequate arrangement, it is an adequate arrangement.

ELIZABETH FARNSWORTH: Mr. Tucker, tell us briefly how an inspection you were part of was set up and how you got to be part of it.

JONATHAN TUCKER, Former U.N. Inspector: Yes. At the time I was working for the arms control and disarmament agency, and there were requests for experts with some knowledge of biological weapons to go to Iraq, participate in a team to assess Iraq's capabilities in biotechnology, the extent to which they could produce fermentation tanks and other equipment they would need to make biological weapons. The team consisted of experts from a variety of countries, including Russia, France, Switzerland, Canada, and the United States. So it was--

ELIZABETH FARNSWORTH: You were called in from here--

JONATHAN TUCKER: Yes.

ELIZABETH FARNSWORTH: You fly to Iraq.

JONATHAN TUCKER: No. The team actually met in Bahrain, and there was about three days of briefings and preparation recovering from jet lag, and then we were flown in the military transport to Baghdad, and spent two days visiting facilities in and around Baghdad.

ELIZABETH FARNSWORTH: Was there an element of surprise?

JONATHAN TUCKER: These inspections were primarily at declared sites that Iraq had made public. Many of them were dual use facilities or factories involved in the production of heavy equipment, for example. They were producing a large fermentation tank for a declared dual use facility. So the Iraqis were generally quite cooperative and cordial. They have genuinely been only confrontational when there have been surprise inspections at sensitive sites where they have something to hide.

ELIZABETH FARNSWORTH: Okay. Now, I know you weren't involved in any of the presidential sites, but from what you know, from the experience you went through, will this new agreement hamper--would it hamper your ability if you had had to go to one of those sites?

JONATHAN TUCKER: I did have some concerns about this new arrangement to create a special group, not specifically for the presidential sites because it's clear that Iraq has received full warning that these sites were going to be inspected, so I would be very surprised if there's anything there. My concern is that this arrangement might establish a precedent for other sensitive sites, for example, sites controlled by the Special Security organization, Special Republican Guard, other security services, where UNSCOM I believe has good evidence that sensitive materials are being hidden, perhaps documents relative to the weapons programs. If there is, for example, a confrontation at one of these sites, the Iraqis attempt to deny access, they may then invoke the special group procedure, even though it was only designed for the presidential sites. And I think there are very serious problems with this procedure if applied generally because it actually circumvents the normal chain of command through UNSCOM and would it--because this group involves the secretary-general going directly to the Security Council instead of the executive chairman of UNSCOM. So, in a sense, it would undermine UNSCOM's authority.

ELIZABETH FARNSWORTH: Mr. Zilinskas, do you share those concerns, and what about the presence of diplomats, what effect will that have?

RAYMOND ZILINSKAS, Former U.N. Inspector: Well, I absolutely share Jonathan's opinion on this. I think the problems are twofold. First of all, the Iraqi classification of so-called sovereign sites included all presidential palaces and all headquarters and ministries, and yet, this agreement only covers eight presidential palaces. So what's going to happen when UNSCOM tries to access some of these other sovereign sites that are not covered? And then a second, as you eluded to, the logistics seems to me a potential for a real nightmare. The agreement calls for senior diplomats to accompany them. Does that mean that we're going to have a bunch of senior diplomats waiting in the wings in Baghdad, or is it going to be a situation where UNSCOM wants to mount an inspection somewhere outside Baghdad, and suddenly they're supposed to fly in a bunch of diplomats from everywhere in the world? I see a very difficult problem coming up here.

ELIZABETH FARNSWORTH: What about that, Mr. Ambassador, would it be hard, wouldn't it be hard for a diplomat, for example, let's say a team is going to point A, they say they're going to point A, then they turn and go to point B as a surprise, would that be difficult for a diplomat, do you think?

ROLF EKEUS: It's clear it can be difficult, but--and it is clear that the Iraqi side will get sort of forewarning if the team is accompanied by some senior diplomats. Iraq will know exactly that there must be one of the eight sites in play and give the forewarning. That is obviously a very complex operation problem, which the chairman of UNSCOM has to solve. There are errors that, I think--techniques and modalities which can be developed by them. But also concerning the other concerns raised I think it is clear from the agreement--or so called memorandum of understanding, which was achieved by the secretary-general, that sites which are not presidential sites will follow the established procedures as it is stated in the memorandum, and the established procedures have been very solid. I mean, it was these procedures which led Saddam to start all the fighting and trouble, creating all the trouble with the inspectors in the beginning. So I think there the secretary-general gained a very important concession, or at least managed to bring back the situation to what it should be in his negotiations. So I'm less concerned about that aspect.

ELIZABETH FARNSWORTH: Mr. Tucker, do you feel that as a former inspector that you've been denigrated by this process? There's been some suggestion, including by the secretary-general, that the inspectors were perhaps less than respectful in what they did. Do you feel that this could weaken the inspectors?

JONATHAN TUCKER: No. I think there's a problem with diplomats who are not familiar with the history of Iraq's weapons program and also the Iraq's determined efforts to deny full understanding of these programs to the inspectors. They engaged in a systematic effort over the past seven years of what's called denial and deception, misleading the inspectors, denying them access to relevant facilities, and I think the diplomats who accompanied these teams may not understand that real firmness and sometimes strength, and which might be interpreted as aggressive behavior, is necessary to gain access to these facilities and persuade the Iraqi authorities that they have to hand over the information that they are required to under international law. So I think this is a potential problem. Another problem is that Saddam has tried for the past five years to circumvent UNSCOM by creating a direct channel to the U.N. secretary-general, and I think by creating this special group he has done just that.

ELIZABETH FARNSWORTH: Mr. Zilinskas, how do you feel about whether you have been denigrated, your work, by this process and whether that will weaken the inspectors.

RAYMOND ZILINSKAS: I think the same thing that Jonathan just stated, that a good inspector is one who doggedly sticks to doing his assigned or her assigned task, and does it regardless of what resistance met by the Iraqis. To give you a concrete example, in June of 1994, there was a team that went out to do some digging in the Salman Park Peninsula, which was of course known as a biological research facility, and there were trenches that had been used, and this was obvious from aerial photography. When they got there and they pulled a surprise inspection, the Iraqis became very concerned, and the first thing they said, this is a burial plot; you can't dig in here because it's sacred to the Islamic religion, and they actually managed to hold up proceedings for about 24 hours, but then the chief inspector, who was very courteous, very good, he just stuck with it, and they dug, and of course, they didn't find anything--no bodies, nothing. So it was obviously an attempt by the Iraqis to deflect UNSCOM for a while. So is that working on their sensitivities? I don't think so, because they lied and they cheated, and they do that pretty regularly.

ELIZABETH FARNSWORTH: Mr. Ambassador, what has been the effect on the inspecting process of the past four months of crisis?

ROLF EKEUS: It is a serious problem obviously that a declaration has not been able to operate any, I would say, sensitive or difficult inspection because of the political turmoil around this issue. We have to recall that the ordinary routine monitoring is going on fully well, where a couple of inspection teams go out every day seven days a week and carry out their very, very useful work. But these more pointed, these more searching inspections, they of course have been hampered, and the planning has been disturbed by that. But I don't think any fundamental loss has taken place anyhow, and I also have to hasten to add that our inspectors, the UNSCOM inspectors, is a wonderful group of people. I mean, they are scientists and highly professional, and really serious persons, and I cannot understand that any criticism of their behavior could be justified. That is a point I must emphasize.

ELIZABETH FARNSWORTH: Mr. Tucker, Robin Wright, the correspondent for the LA Times, wrote this week that "the U.N. program to find and dismantle Iraq's deadliest arms may now be so badly handicapped that inspectors are unlikely to ever complete their mission." What's your response to that?

JONATHAN TUCKER: Well, I think she pointed out some very real concerns. There has been an effort recently to politicize UNSCOM, which is really a scientific and technical group. It's not a political group. But by bringing in diplomats, there's a proposal by the Russians, for example, to require consensus among all 21 commissioners of UNSCOM before the commission can do its work, I think these political proposals would paralyze the work of the group, which is really a technical job of finding prohibited weapons and eliminating them.

ELIZABETH FARNSWORTH: And, Mr. Zilinskas, in the few seconds we have left, do you have anything to add to that?

RAYMOND ZILINSKAS: I agree with that, but I must add that it all depends on the cooperation that the Iraqis will give to UNSCOM. You have to remember that security, the logistics, all this is provided by the Iraqis, themselves, so UNSCOM and the international Atomic Energy Agency, the inspectors can't work without the full cooperation. So this agreement, I have some real concerns about it and doubts about it, I must say it can work if the Iraqis decide to cooperate fully and do what they're supposed to, what they have agreed to, then I think it'll work; otherwise, it won't.

ELIZABETH FARNSWORTH: Well, thank you all very much.

JIM LEHRER: Still to come on the NewsHour tonight, a silver story, campaign finance reform, and a poem about Barbara Jordan. FOCUS - GOING FOR THE SILVER

JIM LEHRER: A story of silver as told by business correspondent Paul Solman of WGBH-Boston.

PAUL SOLMAN: In the silver pit at New York's commodities exchange, as usual, the traders are going nuts. Not so usual, the price of what they're trading, silver, itself, has soared since July, up more than 50 percent at one point. That's significant because silver's price has been in the pits for decades. More significant, though, is that America's most famous investor, Warren Buffet, is the man behind the run-up. Before getting to Buffet, however, we're going to take a rather long look at the metal he's been buying because silver's highs and lows tell an awful lot about the U.S. economy, past and present. Investment writer Jim Grant.

JIM GRANT, Financial Reporter: For most of recorded human history silver has been money. It's shiny; it's pretty; it's a great conductor. It is as malleable almost as gold that's kind of a precious metal that also does blue collar service.

PAUL SOLMAN: Less rare than gold but still rare enough. For early civilization, silver had the key attribute of a medium of exchange. It could be subdivided to stand for the value of things you wanted but couldn't swap one for one. No wonder that 4,000 years ago in Mesopotamia to earn was to make silver, or that 2500 years ago the first silver coins were minted by the one guy in history as rich as Croesus, King Croesus, himself, or that a thousand years ago the English pound began life as a pound of silver, or that silver money played a major role in U.S. economic history back in the 1890's. Historian Hugh Rockoff sets the scene.

HUGH ROCKOFF, Rutgers University: The 90's were a very depressed period, something on the order maybe of the Great Depression of the 30's, very high unemployment, bank failures, the stock market has crashed, and people are looking for a way out.

PAUL SOLMAN: The Federal Reserve didn't exist yet to regulate the money supply and get us out of such crises. The U.S. could only print or mint as much money as there was gold. And gold, of course, was very scarce. Eastern business interests loved this gold standard for keeping inflation at bay. By contrast, western farmers and miners wanted to rev up the economy with more plentiful silver.

HUGH ROCKOFF: What the populace wanted was what they called free and unlimited coinage of silver. People would bring in silver; it would get coined into money. And then as that money began to flow into the banking system, you'd expect an increase in lending, and supply of money.

PAUL SOLMAN: Given the 1890's depression, silver became "the" issueof the '96 campaign. Republican candidate William McKinley upheld the gold standard. Democrat William Jennings Bryan stood for free silver to spur the economy--the start of the Democrat's century-long fight against tight money.

WILLIAM JENNINGS BRYAN: You shall not thrust down upon the brow of labor this crown of thorns. You shall not crucify mankind upon a cross of gold.

PAUL SOLMAN: History has preserved Bryan's cross of gold speech at the Democratic Convention. But during the campaign that followed, Bryan's supporters accused him of backing off, which brings us to silver's most memorable role of all as the real star of the Wizard of Oz. The lion is actually candidate Bryan, too cowardly to lead the charge for free silver.

LION: [crying] Is my nose bleeding?

PAUL SOLMAN: Or at least that's how the populist farmers saw it. And author Frank Baum represented it in his turn of the century novel. Hugh Rockoff has written an article explaining Baum's story as an allegory about the great money debate of the 1890's, with each character playing a distinct historical part. Hexing William Jennings Bryan's lion--William McKinley, the wicked witch of the West. He came from Ohio. Sweet Dorothy stands for traditional American values. Toto is the teetotaler, since the prohibitionists were also pro silver. The decent scarecrow is the farmer.

HUGH ROCKOFF: Tin Man is the worker who has kind of lost his heart. But he's become unemployed in this Great Depression of the 1890's.

PAUL SOLMAN: Now, this may be more than you need to know, but it's so cool we just can't help ourselves. There's the yellow brick road, the false path of the gold standard; the emerald green city, wealthy Washington, D.C.; the obscure but powerful Oz, Republican Party Chairman Marcus Haddock. He's the Wizard of Oz because--

HUGH ROCKOFF: Because he's the money bags. He's the guy with the-- that's really manipulating the political system and keeping the country on the gold standard.

PAUL SOLMAN: And gold, of course, is measured in ounces--oz for short--Oz. The 1939 movie took liberty with Baum's story, the biggest being Dorothy's ruby slippers. In the book they were made of silver. Dorothy had the answer all the time--a little inflation to give the economy a lift. But, sad to say, back to real life. Bryan and silver both lost. The economy picked up smartly in the late 1890's, when gold was discovered in Alaska, Canada, and South Africa, and expanded the money supply anyway, suggesting the free silver folks had been right all along. Okay. After all that time in Oz you may have forgotten that our story was prompted by this man--Nebraska's legendary investor Warren Buffet--an esteemed corporate statesman whose most public moment may have been his rescue of the scandal-scarred brokerage firm, Salomon Brothers, in the 1980's. Buffet's own Mutual of Omaha is Berkshire Hathaway, a company that works like a mutual fund. Its stock has risen an average of 33 percent a year for 32 years now, outpacing the market as a whole by an astonishing 300 percent. No wonder Buffet in his annual meeting remarks to shareholders has become an oracle of investment wisdom. Whatever he says goes. Larry Cunningham teaches corporate law at Yeshiva University's Cardozo Law School and has studied Buffet's investment bent.

LARRY CUNNINGHAM, Cardozo Law School: He thinks hard about who the managers are, whether they're loyal, whether they have integrity, whether they think like owners, and have an owner orientation in mind. And secondly, he thinks about the products, the brand names, products that have a franchise value, that is, the consumers recognize them instantly. If you say "soft drinks," people will think "Coke"--or shaver you think "Gillette."

PAUL SOLMAN: Buffet's now a multi-billionaire, maybe through genius, maybe luck, but surely his analysis of and zeal for favorite companies hasn't hurt. It came as a shock then that when someone went on a silver spree last summer--buying up 125 million ounces--that someone turned out to be Warren Buffet for Berkshire Hathaway.

LARRY CUNNINGHAM: They've got an enormous amount of cash, and they've got to do something with it. And the thing they like to do most with it is buy 100 percent of small, well-run businesses, or small pieces of large companies in the open market. But they'll only do that if the price is right, if it's lower than the value. They look in the market today; they don't see many opportunities, but they need to do something with the cash--they looked at silver. They thought, well, the price there is probably lower than its value--let's put the money there.

PAUL SOLMAN: So now what would lead 'em to think that silver would now be a good investment?

LARRY CUNNINGHAM: You can look at the supply of silver and the demand that people use silver in their products have, jewelers and film companies and you just look at the relationship between the demand and the supply over some period of time, and you could see the demand was creeping up, the supply was lagging behind. That suggests that the price is going to go up.

PAUL SOLMAN: But is the subsequent price rise simply a self-fulfilling prophecy, that is, is Buffet just driving up demand by his massive buying, thus squeezing the market? Because that's what happened during silver's last great moment in U.S. economic history. It was the late 1970's. Inflation was raging, and buying precious metal was a favorite way for investors to protect themselves against the dollar losing value. A couple of Texas oilmen, the Hunt Brothers, started amassing silver, much of it with borrowed money, trying to corner the market. And they did, driving the price from $10 an ounce in 1979 to $50 an ounce the following year. But at that price people flooded the market with an excess of silver. The price dropped; the Hunts' loans were called; they had to sell; the market crashed; and with inflation ebbing, silver never recovered. By last July, it was down some 95 percent from its peak, adjusting for inflation. Warren Buffet's been accused of trying the same scheme, but, says Jim Grant--

JIM GRANT: Mr. Buffet seems not to be in the business of cornering the silver market, in the business of buying something low and selling it high, which is very interesting because it seems to be the anti-Buffet investment. There's no enterprise value; there's no great franchise value.

PAUL SOLMAN: No good managers.

JIM GRANT: There's stuff, to be sure shiny stuff, and conductive stuff but stuff.

PAUL SOLMAN: Stuff, by the way, that not only doesn't pay you a dividend or interest rate but that you have to pay to have stored somewhere. So did Buffet know something that investors who play the silver market every day like Eric Plateis didn't?ERIC PLATEIS, Silver Trader: I've heard discussions on these fundamentals for probably the last year and a half, that the man has been outstripping supplies for a while now, so Warren Buffet probably simply saw those numbers everybody else has seen, and was willing to take a bet on it.

PAUL SOLMAN: But if most of you thought that, why weren't you all buying silver?

ERIC PLATEIS: Part of it is a function of capital, WarrenBuffet has enough capital to do what the average person down here cannot do. I mean, the guy sitting in the ring certainly is not capable of buying a billion dollars' worth of silver and socking it away because it's undervalued. Warren Buffet has the benefit of being able to do that.

PAUL SOLMAN: Buffet was able to do it, and it's worked. When he began buying in July, the metal was trading at less than $5 an ounce, and in the seven months since, it's risen as high as $7. Buffet's firm bought a staggering 1/4 of the world's supply for a profit on paper of about $1/4 billion. So is now the time for all of us to buy silver?

LARRY CUNNINGHAM: The last thing anybody should do is follow someone else's investment lead. Just because Warren Buffet does something doesn't mean you should do it.

PAUL SOLMAN: Because that's too late already?

LARRY CUNNINGHAM: Right. It will very often be too late.

PAUL SOLMAN: Too late for us and maybe not even great timing by the master, Warren Buffet, himself. Silver was sinking last week and has proved its volatility to everyone from Auntie Em to Nelson Bunker Hart. On the other hand, who would you bet on, the old wizard of ounces or the new one?

JIM LEHRER: Silver did reach a high of $7.61 an ounce on February 5th. Today, it was down to $6.01. UPDATE - CAMPAIGN FINANCE DEBATE

JIM LEHRER: Kwame Holman begins our coverage of the campaign finance reform story.

KWAME HOLMAN: For now at least McCain-Feingold, the primary vehicle for driving campaign finance reform through the Senate, is stuck in parliamentary gridlock. On one hand, the majority of senators, all forty-five Democrats and seven Republicans, say they're ready and willing to vote for the bill.

SEN. MC CAIN: My friends, this is a long twilight struggle. I do not believe that it's easy to ask incumbents to vote to change a system that keeps incumbents in office.

KWAME HOLMAN: On the other hand, McCain-Feingold is short of the 60 votes needed under Senate rules to end debate and bring the legislation up for a final vote. As a result, supporters of McCain-Feingold have been frustrated.

SEN. JOHN KERRY, [D] Massachusetts: It is very, very clear as of today there are a majority of the United States Senate prepared to vote for campaign finance reform. There is a minority that is trying to stop it.

KWAME HOLMAN: And leading the minority is Kentucky Republican Mitch McConnell.

SEN. MITCH McCONNELL, [R] Kentucky: Forty-eight Senators are not in favor of this measure. And in the Senate, as we know, in recent years every issue of any controversy requires sixty votes. So it is not at all unusual when an issue cannot achieve 60 votes for it not to go forward. That's the norm around here.

KWAME HOLMAN: As it's currently written, the McCain-Feingold bill would ban the use of soft money, unrestricted contributions meant to build political parties but which, in practice, are used to support specific candidates. It also would restrict spending on issue advocacy ads, which highlight issues as a means of targeting particular candidates for defeat. No one in the Senate has endorsed the use of negative political advertising, but there is disagreement on how and whether it should be regulated.

SEN. TOM DASCHLE, Minority Leader: Negative advertising is the crack cocaine of politics. We're hooked on it because it works. We're hooked on it because we win elections using it. There's no accountability, no reporting. It's publicly not tied to any candidates. How many times have I heard the candidates actually say I couldn't keep track of who was on my side? I'd watch television. And I'd hear my name used pro and con, and I didn't have anything to do with those ads.

SEN. ROBERT BENNETT, [R] Utah: We don't like independent expenditure ads. We want to control them. They make us mad many times from our friends, many times from our opponents, but they are part of the price we pay for a free press and free speech in this country, and I, for one, am not willing in the name of shutting down that kind of an ad to damage the First Amendment right that everyone has, including the First Amendment right to be stupid, the First Amendment right to be outrageous, the First Amendment right to say inflammatory kinds of things.

KWAME HOLMAN: Maine's Olympia Snowe and Vermont's Jim Jeffords, both Republicans, have offered an amendment to McCain-Feingold. It would require organizations sponsoring political ads in the weeks before an election to disclose their contributors. And labor unions and corporations would be prohibited from sponsoring such ads during that period.

SEN. OLYMPIA SNOWE, [R] Maine: This amendment would pass constitutional muster. And I think that that's what causes some anxiety for some people because they're opposed to this amendment because it will require disclosure of major donors. Since when has disclosure been antithetical to big government?

KWAME HOLMAN: This evening on the Senate floor supporters of the Snowe-Jeffords Amendment were expected to withstand an effort to table or defeat the measure, but the critical test for Snowe-Jeffords and McCain-Feingold will come tomorrow when the Senate votes on whether to end debate and allow the campaign reform measures to proceed to a final vote. Again, to get there, each bill will need 60 votes, more votes than supporters so far have been able to muster.

JIM LEHRER: Phil Ponce takes it from there.

PHIL PONCE: Now, whither campaign finance reform? We pick up the debate with Democratic Senator Joseph Lieberman of Connecticut and Republican Senator Robert Bennett of Utah, graciously substituting for Senator Mitch McConnell, who was unable to leave the Senate floor. And, gentlemen, welcome.Sen. Bennett, we just heard you say that you oppose this compromise bill on campaign finance reform because of your concerns about the First Amendment. How does it counter, run counter to the First Amendment, sir?

SEN. ROBERT BENNETT, [R] Utah: Well, the Supreme Court has been very clear on its definition of political speech, what is free speech, and it has declared huge chunks of McCain-Feingold to be unconstitutional in a variety of related cases. Frankly, I don't know whether Snowe-Jeffords falls into the same category as the McCain-Feingold but in this particular battle we've reached the point where both sides have built their lines, armed their artillery, drawn the line in the sand, and started firing, and I think the best course of action is to defeat everything this year, let the tempers cool down, and come back and take another shot at it next year. So that's why I'm opposing this amendment and all others.

PHIL PONCE: Sen. Lieberman, you are one of the co-sponsors of a bill that's being described as a compromise that has the best chance of the different incarnations out there to pass tomorrow. You're not expected to have the 60 votes necessary to keep this bill moving forward. Will that, in fact be it for campaign finance reform?

SEN. JOSEPH LIEBERMAN, [D] Connecticut: Well, I hope not. I spent the better part of last year, along with my friend from Utah and the Government Affairs Committee investigation of the 1996 campaign, and I think my conclusion certainly was that there's no more campaign finance regulatory system. The limits that were established in the law-- individuals can give only up to $2,000 to a campaign. Unions and corporations can't give anything, and those limits, incidentally, have been upheld as constitutional. They've been totally circumvented by soft money and candidate ads that pose a so-called issue ads, and that's exactly what McCain-Feingold would prohibit. I'm confident, incidentally, it would be constitutional because the court has said over and over again you can regulate contributions to campaigns that are not the total amount of spending on it. So I hope we don't give up. I think we're in one of those situations in the Senate where the rules are stopping a majority, a bipartisan majority, from responding to a crisis. The filibuster was supposedly put into the rules of the Senate to stop irrational passions from sweeping too quickly into law. The Senate tends not to do anything too quickly these days--and this is not an irrational passion--this is a rational response to a terrible problem we have, where money is dominating our political system.

PHIL PONCE: How about that, Sen. Bennett, is a minority in the Senate basically holding up what the--granted, a small majority, but nonetheless a majority wants to do?

SEN. ROBERT BENNETT: Well, I liked Sen. Lieberman's comment about the purpose of majorities of filibuster rules to try to hold up irrational passions, and, in my view, this is exactly that. I don't think this will clean up the problems that we have in the campaigns at all. I think it will be unworkable and unenforceable. I think it would make things much more difficult for challengers. We incumbents would really, really thrive under the kinds of rules that are being passed here. It clearly would encourage more of the issue advocacy ads that it seeks to hold down and clearly the Supreme Court would uphold that. So yes, I think this qualifies for the use of the filibuster because I think it is very, very much in the interest of the republic to slow this one down and do it right, rather than react to the hysteria that's been generated.

PHIL PONCE: So, Sen. Bennett, you're saying that one is better off with the status quo than some of these options that are being presented at this moment?

SEN. ROBERT BENNETT: I really think we would be--we are better off with the status quo than McCain-Feingold. I believe McCain-Feingold falls on two bases--one that I've already outlined--it's clearly unconstitutional--and, No. 2, it's unworkable. It creates a whole series of bureaucracies and rules and requirements that would make life absolutely impossible, except for those that are willing to do as was done in 1996, find ways to skirt the law, find ways to go around it. And new challengers are not experienced enough to do that, and incumbents are. This is clearly an incumbent protection act, no matter how much John McCain says incumbents are against it because they want to keep the present system. This would make incumbents even safer.

PHIL PONCE: Sen. Lieberman, how much heat do you think you will--you and your colleagues will feel from the--will get from the public if a campaign finance reform act is not passed?

SEN. JOSEPH LIEBERMAN: I'm afraid my honest answer to that is not enough heat. And I think it's because though the public in every poll we see feels that money matters more than their votes in American politics--in that sense, therefore, they should be crying out to us to cut down the influence of big money, take the "for sale" sign off of American politics that we put up in the '96 election--I think they're pessimistic, they're cynical; they don't think we have the ability to break this habit, and the only thing that's going to get us from the 52 votes we have now in the Senate, a majority up to the 60 to break a filibuster, is the American people, Republicans and Democrats and independents getting on the phone, calling the Senators and saying, hey, cut it out, you know, this democracy was supposed to be about one person, one vote, equal access to government, instead of the kind of circus we had in '96, were people giving hundreds of thousands of dollars, millions of dollars, obviously buying access to influence our government, unequal access. And as long as that goes on, our democracy is not going to be what the founders of this great country wanted it to be.

PHIL PONCE: So, Sen. Lieberman, are you saying that the hearings--last year's hearings about the alleged abuses during the 1996 campaign-- basically were insufficient to light a fire under the public of the kind that you'd like to see?

SEN. JOSEPH LIEBERMAN: Well, I'm afraid so. And it seems to me, having sat there and listened to all the evidence, that it certainly lit a fire under me because I was embarrassed for what I saw. When you begin to break the limits on campaign contributions and you accept hundreds of thousands of dollars and you invite people into the White House, into the capitol for special access to the people with the most power in this government, you're going to have a lot of hustlers and con artists and special interest purchasers paying that money. And the effect is to distort the system. And basically, leave that aside for a moment, we've got some laws in this country. They say individuals can give a limited amount. Corporations and unions can't give anything. Those laws were grossly evaded in 1996, and I don't know how we go on and continue to let that happen. I mean, the lawmakers, in some sense, have become the law breakers, and it's no wonder that the public is cynical. I just wish they would have enough confidence we can change that they demand change by their Senators here in Washington. It may not be McCain-Feingold. Maybe we have to get together and massage that a bit, but I can't believe we're going to walk away from this 105th session of Congress after all that we know about what happened in 1996, without some kind of campaign finance reform.

PHIL PONCE: Sen. Bennett, how about that, what kind of changes-- in the short time we have left--what kinds of changes do you think are in the offing in the future?

SEN. ROBERT BENNETT: Well, I view this a little like the health care debate, where there was enormous need for major reform, a great deal of effort put into it, but ultimately we got a vehicle that was totally unworkable and died of its own weight. We came back when the passions were lower in the next Congress, and we passed the Kassebaum-Kennedy bill, which we probably should have passed two years earlier, but the political situation didn't allow it. And I'd be perfectly willing to work with Sen. Lieberman and any other fair-minded member of the Senate--and he certainly is one--to craft some solutions in the next Congress when these passions have died down a little and we've gotten a little more sober to get us in the direction that I think we should go. I agree with him that there are excesses in the system and that they need to be fixed. It's just that the vehicles that we've been offered on the floor of the Senate are so clearly not the answer that I'm willing to take the stand that I've taken.

PHIL PONCE: Senators both, thank you very much. FINALLY - A BIRTHDAY MEMORY

JIM LEHRER: Last Saturday was the birthday of the late Barbara Jordan, who died two years ago. She was a congresswoman from Texas, a teacher, and a noted orator. She was also a hero to the Poet Laureate of the United States, Robert Pinsky. Here's his poetic remembrance.

ROBERT PINSKY, Poet Laureate: It's become kind of commonplace to say that there are no public figures that we respect and admire anymore, particularly in political life. In fact, many of us admired and respected the late congresswoman, Barbara Jordan, very much. This is a poem I wrote thinking about Barbara Jordan and the admiration she invoked in me and many other people. In the poem, I try to compare the excellence that she represented as an ideal with another, maybe easier, certainly different ideal embodied by the legend or myth or belief of the fall from Eden and Eve as first perfect and then fallen. The poem has a long title: "On 'Eve Tempted by the Serpent' by David Defendente Ferrari, and in Memory of Congresswoman Barbara Jordan of Texas." "Rare spirit, remembered now with a pang of half-forgotten clarity or density, a quality, quilled, a learned freshness, unshattered, though not perfect, not Eden, not this rippled meander through newborn islands, these parentless leaves and branches, tender, this green marsh, fresh, the blue, the white feet of our adolescent mother, myths of perfection imagined just before unperfecting itself as if by impulse. And grinning cynically in a tree, bearded big nose, already stuck on his tube of body: the crawler, we the tempter, we the corrupted, with no notion where bright spirits are culled, our very admiration a self-exculpation. 'Who is this strange bird?' we say, as if the achieved idea were a sport, the discovery of a parrot, gaudy escapee from some domestic cage into azure margins of California. Crested stranger, it joined a band of crows, flew and fed with them, conducted itself as one brilliant crow. We prefer that to this other realized excellence, eloquence, made of our same eggs and flowers and waters, plumed as we are, no feathered exception immune to that first painted April when we fell, we fowl of a feather. And we feel not that she made it look difficult or easy, but possible, and we fall." RECAP

JIM LEHRER: Again, the major stories of this Wednesday, President Clinton toured tornado-hit Central Florida to comfort victims and promise financial aid. Senate Majority Leader Trent Lott announced the U.N. deal with Iraq, and the U.S. Supreme Court ruled federal credit unions may not enroll customers who do not have a common bond, like the same workplace. We'll see you on-line and again here tomorrow evening. I'm Jim Lehrer. Thank you and good night.