The MacNeil/Lehrer NewsHour

Intro JIM LEHRER: Good evening. Leading the news this Wednesday, a federal judge delayed an indictment against former White House Aide Michael Deaver. The New York Times said the Tower commission has concluded President Reagan was fully briefed throughout the Iran arms deal. The Supreme Court upheld another affirmative action plan. And SMU became the first college ever to be banned from playing intercollegiate football. We'll have the details in our news summary in a moment. Charlayne Hunter Gault is in New York tonight. Charlayne? CHARLAYNE HUNTER-GAULT: After the news summary, we'll look at the Deaver case and the issues it raises over the legality of the independent counsel. Then a profile of Grammy Award winner Paul Simon and his controversial album Graceland. SMU's president talks about his college being barred from football in a newsmaker interview. And we have a report on the big time outside money in college coaching.News Summary LEHRER: An independent counsel planned to seek the indictment of President Reagan's former top aide Michael Deaver today, but it didn't happen. A federal district judge in Washington delayed the action. Judge Thomas Penfield Jackson said he wanted to consider Deaver's claim the 1978 independent counsel's law was unconstitutional. He set March 11 as the day for deciding whether to make that delay permanent. The independent counsel, Whitney North Seymour, Jr. , told the judge he planned to ask for a four count indictment of Deaver, alleging Deaver lied to a federal grand jury and to a congressional committee. Seymour declined to comment on the temporary delay as he left the court house. But Deaver's lawyers and a congressional lawyer had these comments.

HERBERT MILLER, attorney for Michael Deaver: I think the judge's decision speaks for itself. REPORTER: You must be rather pleased that you were able at least temporarily to prevail here, Mr. Miller, aren't you? Mr. MILLER: Well, I think the constitutional issue is a very important one. STEVE ROSS, counsel to house clerk: The court has merely said that it will look at the question of the constitutionality of the statute. There have for some time been questions raised about the constitutionality of the independent counsel statute, and it is not surprising that a court will take a look at it. We presume the statute to be constitutional, and we believe that the court will permit the independent counsels, of which there are several, to go forward with their important tasks under the statute. LEHRER: Deaver is not the only former Reagan aide challenging the constitutionality of the independent counsel. Lawyers for fired White House National Security official Lieutenant Colonel Oliver North filed suit yesterday to stop a similar investigation of the Iran arms deal. Charlayne? HUNTER-GAULT: There were more leaks today from the Tower commission report, due out Thursday. The New York Times reported that President Reagan was regularly briefed on the administration's arms sales to Iran. Quoting officials who had seen the report, the Times said, however, that President Reagan's participation in the meeting was minimal, often simply asking questions about the American hostages being held in Lebanon and telling anecdotes. Meanwhile, a Los Angeles Times poll published today reports that about 75% of Americans believe that the White House tried to cover up the Iran arms scandal and that two thirds think the affair has diminished President Reagan's ability to lead. LEHRER: The Supreme Court barely upheld another affirmative action plan today. It was one for the Alabama State Police that requires one black officer be promoted for each white until blacks comprise one fourth of the police high command. The court made the ruling by the narrowest of margins in a five to four vote. The Reagan administration was on the losing side. It had challenged the Alabama plan as profoundly illegal. Justice William Brennan's main opinion said past discrimination in Alabama justified the plan. In another decision today, the court said states can not refuse unemployment benefits to workers fired for refusing to work on their sabbath. The vote was eight to one on a case that came from Florida. HUNTER-GAULT: Soviet leader Mikhail Gorbachev charged today that the West, led by the United States, was doing their utmost to hinder his drive for domestic reform. He blamed the United States for the deadlock in superpower arms negotiations and said that the West was using the arms race to frustrate Soviet efforts toward economic efficiency. In a wide ranging speech before the Congress of Soviet Trade Unions, the Soviet leader also cautioned his country's workers that tangible benefits of new Kremlin policies would be a while in coming. British Prime Minister Margaret Thatcher was reported to be satisfied with assurances that Washington doesn't plan early deployment of its missile defense system known as Star Wars. British officials said Mrs. Thatcher received the assurances from former U. S. Arms Negotiator Paul Nitze on her left and Assistant Defense Secretary Richard Perle on her right. The meeting was the first in a series of talks aimed at assuaging fears in Western Europe that the administration was moving to deploy the system too soon. LEHRER: Today's story from Lebanon was of a massacre. Leaders of Hezbollah, a radical Shi'ite Moslem sect, claimed 23 of their fighters were murdered by Syrian soldiers and vowed revenge. A funeral march took place today for the 23 men in the Shi'ite Moslem sector of Beirut. A Hezbollah statement said the fighters were murdered with axes and bayonets after their hands were bound. But police sources claim the men died in hand to hand combat with Syrian troops. The Associated Press reported today an Italian arrest warrant was issued for an American archbishop. He is Paul Marcinkus, who heads the Vatican bank. He is accused of participating in the 1982 collapse of an Italian bank triggered by $1. 3 billion in loans to dummy corporations. Marcinkus has repeatedly denied any wrongdoing in the case. HUNTER-GAULT: In Chicago, Mayor Harold Washington celebrated a victory in yesterday's Democratic Party primary. He defeated former Mayor Jane Byrne with about 53% of the vote. But Mayor Washington still faces three more opponents in the general election on August -- April 7. We have a report from correspondent Elizabeth Brackett.

ELIZABETH BRACKETT [voice over]: A huge turnout in Chicago's black neighborhoods plus an increase in white support gave Harold Washington a Democratic primary victory last night. HAROLD WASHINGTON, mayor, Chicago: I commend with deep respect and appreciation Jane Byrne, my opponent. She fought a tremendous fight. JANE BYRNE, former mayor: The people have spoken. We didn't make it. I love all of you too. BRACKETT: But the surprisingly small margin of victory for Washington will energize his three white opponents for the general election in April. [voice over] And just after sunup this morning, longtime Democrat, now third party candidate, Thomas Hynes was already going after the mayor. THOMAS HYNES, independent candidate: Mayor Washington did not receive a mandate. In fact, he is disappointed by the returns, and it bodes well for my campaign. BRACKETT [voice over]: But it's not just Hynes versus Washington. There's another Democrat turned third party candidate in the race: leader of the white opposition in the city council, Alderman Edward Vrdolyak. EDWARD VRDOLYAK, independent candidate: We are going to take this right to Mr. Washington on the issues. BRACKETT [voice over]: And there's one more: a not so well known Democrat running as a not so well known Republican. DONALD HAIDER, Republican candidate: I think by April 7, people will know how to pronounce my name. BRACKETT [voice over]: If all three white candidates stay in the race, the mayor will be celebrating again in April. If two drop out, it's a horse race. LEHRER: Southern Methodist University was handed the stiffest penalty ever today for violating NCAA player recruiting rules. The Dallas school was banned from playing any competitive football games this year, with severe restrictions to continue in 1988. The action was announced in Dallas today by NCAA officials. It followed disclosure of a $25,000 payment to a high school linebacker to play football at SMU. HUNTER-GAULT: That's our news summary. Still ahead on the News Hour, challenging the legality of the special prosecutor in the Deaver case and others, Paul Simon and his controversial album Graceland, SMU's president on the football ban, and outside bucks for college coaches. False Witness? LEHRER: The Michael Deaver indictment is the lead story of the day. It was not returned today in Washington by a federal grand jury, as expected. Instead, a judge delayed all action until March 11, so he can resolve a constitutional question. Deaver's attorneys claim the 1978 independent counsels law is unconstitutional, and thus any indictment brought by one would be illegal. The judge agreed after a hearing the argument at least deserved to be considered. Attorneys for another Reagan aide in trouble, Oliver North, yesterday asked another federal judge in Washington to consider the same argument in stopping an independent counsel's investigation of North and the Iran arms deal. We consider it now with Elizabeth Holtzman, who was the principal author of the 1978 law when she was a Democratic member of Congress. She is now the district attorney in Brooklyn, New York. And Raymond Randolph, a Washington defense lawyer who challenged the constitutionality of another independent counsel's investigation in 1980. He dropped his challenge when the independent counsel cleared his client of all charges. Mr. Randolph, to you first. Do you think Deaver's lawyers have a good case? RAYMOND RANDOLPH, defense attorney: I think they have an excellent case. LEHRER: Why? Mr. RANDOLPH: The Constitution provides as its basic structure a separation of powers between the executive, the legislative and the judicial branch. The provision in the Constitution requires that the core of the executive function -- and one of them is to prosecute criminal cases -- be done by an officer who is nominated by the President and confirmed by the Senate. That is not done with respect to an independent counsel or a special prosecutor, as that person had been called. That person is appointed by three judges in Washington -- sitting in Washington D. C. -- not confirmed by Congress. The action of those judges, unlike maybe any other action these judges perform, is un reviewable. Whomever they choose becomes independent counsel. And for those reasons and a series of cases that the Supreme Court has handed down, including recently the striking down of provisions in the Gramm Rudman Act, I think they have an excellent, excellent chance of success. LEHRER: If it goes all the way to the Supreme Court, which it probably will. Is that what you're suggesting? Mr. RANDOLPH: If it goes to any court. LEHRER: I see. Now, your case in 1980, you didn't take it all the way, because you didn't need to. Is that the facts there? Mr. RANDOLPH: I filed, sought an injunction, like Mr. Deaver's attorneys have done, and got an agreement from the special counsel to halt his investigation. The investigation was held in standstill. And then, several months later, we reached an agreement where the investigation was dropped on condition that I drop my lawsuit, which I did. LEHRER: I see. All right, Ms. Holtzman, what about Mr. Randolph's claim -- that your law is unconstitutional, because it usurps the power of the executive. ELIZABETH HOLTZMAN, district attorney, Brooklyn: Well, it's a good defense lawyer's claim, but I don't think it will stand up in the courts. First of all, when we drafted the special prosecutor legislation, we carefully considered the constitutional issues. And the Constitution on its face, in plain, simple words, says that the Congress may invest the power of appointment in inferior federal officials in courts of law. So we're not trying to read something into the Constitution. That language is there to begin with. But beyond that, courts of law have for almost 100 years been appointing interim U. S. attorneys, interim U. S. prosecutors. When a U. S. attorney resigns from office or dies, for the past 90 some odd years, the interim U. S. attorney who's been appointed has been appointed by the courts. But let's go back to the history. Because it was said somehow prosecution is inherently an executive function, it must be done by the President or somebody appointed by him. Well, if you go back to the founding of this republic, the very first Congress of the United States passed a law allowing private lawyers to prosecute U. S. crimes. They'd be paid for it by getting part of the fines. That's not even a special prosecutor appointed by the courts. Private lawyers were enforcing the U. S. criminal laws at the very outset of this republic, authorized by a Congress some of whose members wrote the Constitution itself. So we have lengthy history, lengthy precedent, and on top of it the clear and specific, explicit words of the Constitution of the United States. LEHRER: Mr. Randolph? Mr. RANDOLPH: Well, I'd remind Ms. Holtzman that the first Congress also passed the Alien and Sedition Act, which everyone today knows is unconstitutional. In addition to that, the appointing power that was referred to regarding temporary appointments of U. S. attorneys is one that has been tested but once in a case 25 years ago by a single judge. Whether that's constitutional or not, I don't know. But there is a difference. That individual appointed by a judge on a temporary basis can be removed immediately, one minute after his appointment, by the President of the United States for any reason or no reason whatsoever. It is a temporary measure. This individual, whomever he may be that ascends to the office of independent counsel, is not by any stretch of the imagination an inferior officer under the constitutional guidelines. The statute itself does not provide that. It puts him in the shoes of the Attorney General of the United States. The only difference is, he has a limited target. Instead of the citizens at large, he has, in the case of Mr. Deaver, one target and one target only, with all the power of the Department of Justice behind him. LEHRER: Ms. Holtzman, is this what you lawyers would call a simple legal argument among lawyers, or is there something very important at stake here beyond just the law? Ms. HOLTZMAN: Well, there are some very critical issues at stake here. Namely, are we going to have a capability of an independent investigation of people close to the President, close to the Attorney General, the President himself or the Attorney General himself? And that's why I believe the Constitution gave the power of appointment in precisely cases like this to the court, so that you could have an independent counsel. LEHRER: Is it your position, and was it that position that led to this law in the first place, that in some cases the executive is unable to investigate itself? Ms. HOLTZMAN: I think there's no question. That was -- the experience that gave rise to this legislation was the experience of Watergate, in which, first, the President of the United States refused to appoint any kind of special counsel, special prosecutor. Finally, Archibald Cox was appointed, and that's only because two Attorney Generals had to resign, because they were charged or under suspicion of criminal conduct. Elliot Richardson was about to be appointed, and the only basis on which the Senate would confirm him was his agreement to appoint a special prosecutor. But then we went through the Saturday Night Massacre, where Cox was fired, and a very unsatisfactory and unsettling experience. The Congress of the United States, after that, decided very vigorously after hearings over a number of years that there had to be a mechanism in place to assure the American people that if the President or his top officials came under a cloud of suspicion for criminality, there would be an independent investigation of that, because we could only have one standard of justice in this country. LEHRER: Is it your position, Mr. Randolph, that that kind of situation is just not possible under the Constitution of the United States? Mr. RANDOLPH: Well, it reminds me of something Mark Twain once said -- that one must be careful to get out of an experience only the wisdom that's in it, and stop there. The Watergate experience was an experience where there was no provision for an independent counsel to be named according to an act of Congress, with Congress using the judiciary as an arm to reach into executive functions. The fact of the matter is, the Congress has all the power it needs to put pressure, whether through the confirmation process or through any other process, to require the appointment of special assistant attorneys general. And there is legislation in place for that. What we don't need and what the Constitution does not allow is a distortion of the constitutional system on the argument of necessity. And as we know, the argument of necessity has always been throughout all ages the justification for some sort of tyranny or another. And I'm not saying that the independent counsel is a tyranny. But what it is is a distortion of the Constitution. And the Supreme Court has answered the argument of necessity and emergency in the Gramm Rudman bill, in the legislative veto cases, in striking down provisions of the Federal Election Act too. LEHRER: What from your -- Ms. HOLTZMAN: I think -- LEHRER: Let me just ask Mr. Randolph one follow up question. As a practical matter, let me ask you the reverse side of the question I just asked Ms. Holtzman. As a practical matter, what would be the impact of this going to the Supreme Court and the Supreme Court ruling with Ms. Holtzman or her side in the case -- that it was legal to have an independent counsel doing what he or she is doing now? Mr. RANDOLPH: Well, the impact would be that then we would have a fourth branch of government. We would have individuals appointed by courts not confirmed exercising the power of the prosecutor, which is the most dangerous power that any government official can have in the United States -- the ability to ruin a person's reputation, take away their liberty and destroy them. And those people would be out there, and they would be a fourth branch of government. And I don't think the Constitution allows it. LEHRER: You don't see that as a potential harm, Ms. Holtzman? Ms. HOLTZMAN: No, I don't. Because first of all, we're talking about explicit language of the Constitution. When we held hearings in the Congress, we had support for the constitutionality of this statute by 50 deans of law schools around this country. We had support for the constitutionality from the American Bar Association, from the Department of Justice, from Common Cause, from some of the most leading constitutional scholars in America. The Congress was very careful, because, having gone through the experience of Watergate, we wanted to preserve a constitutional scheme. We did not want to preserve a tyranny. We did not want to preserve a situation in which a President could ignore the will of the people. And I think it's -- LEHRER: We're going -- obviously, we're going to have to see how this thing gets resolved. But let me ask each of you finally, why has this thing suddenly come up now, seven years after the law became law? Mr. RANDOLPH: Well, it has not suddenly come up now. During -- LEHRER: Well, it came up in 19 -- you know, the next year. But it hasn't been raised in any major way until now. Mr. RANDOLPH: It was raised in a major way when the legislature was first -- LEHRER: No, I mean since it was enacted. Mr. RANDOLPH: Since it was enacted. Well, aside from the Kraft case, the number of special prosecutors -- LEHRER: That was Tim Kraft. He was a Carter aide man that you represented. Mr. RANDOLPH: That's right. There have been a number after that. But the defense strategy must have dictated not raising the constitutional challenge. And I think I can say with assurance that each one of the defense attorneys that represented any individual involved in any special prosecutor, independent counsel matter was fully aware of the constitutional defects, but as a matter of strategy decided not to pursue it. LEHRER: Do you smell anything, Ms. Holtzman, from its having been brought up now by both North and Deaver? Ms. HOLTZMAN: Well, it sounds to me like the special prosecutor must be onto something very hot. Because otherwise, they wouldn't be squirming as they are now. The fact of the matter is -- and I think it's important too, in terms of looking at the constitutionality of the statue -- this statute has now been administered by two separate Chief Justices of the Supreme Court who have named special panels, by six separate judges and by Departments of Justice -- two of them -- that have either subscribed explicitly to the constitutionality of the legislation or failed to object to it. Two Presidents who've signed legislation affecting the special prosecutor law into law. So we've already had construction by both the Congress, presidents and judges about the basic legitimacy of this statute. LEHRER: Mr.Randolph, what would be the practical fallout if the Supreme Court ultimately threw this out and declared it unconstitutional? Would all the charges against Mr. Deaver and anybody else who's ever been prosecuted by an independent counsel be moot? Mr. RANDOLPH: Well, there are no charges against Mr. Deaver, and no one has ever been prosecuted. So the consequence would be to handle things like we've been handling for the last two centuries in this country. LEHRER: I mean, but what about -- the independent counsel went before the judge today and said he wanted to seek an indictment against Mr. Deaver. What happens to all the evidence, all that sort of thing? What happens to the process? It just goes back to the Justice Department? Mr. RANDOLPH: It goes back to the Department of Justice, where it belongs. LEHRER: I see. So the prosecution could continue. Mr. RANDOLPH: I could, certainly. LEHRER: And the same would apply in the Iran arms deal as well. Mr. RANDOLPH: Yes. LEHRER: I see. All right. Mr. Randolph, Ms. Holtzman, thank you both very much for being here with us. SMU Penalty HUNTER-GAULT: Sports writers have dubbed it the death penalty, and it was given today to Southern Methodist University, the place where Doak Walker and Kyle Rote played. The NCAA ordered it off the football field for a year, among other things. It was the toughest sentence ever given to a college for violating player recruitment rules. We'll have a newsmaker interview with the acting president of SMU after this brief background report from Kwame Holman.

KWAME HOLMAN [voice over]: The allegations that brought on the banning of football at Southern Methodist University rocked this Dallas campus of 9,000. But it wasn't the first time SMU has been in trouble. In the last 12 years, SMU athletic programs have been penalized five times, mostly for violations of recruitment rules. The SMU team played last fall under NCAA probation for recruitment violations dating back to 1984. But last November, the most serious allegations surfaced. SMU linebacker David Stanley, here intercepting a pass, revealed that he had received regular cash payments from an alumni fan and that school athletic officials knew of the payments. The allegations led to the resignations of both SMU's football coach and athletic director. The NCAA investigation found that 13 football players received about $65,000 from an SMU alumni fan. As they made the joint announcement of the so called death penalty this morning at SMU, NCAA investigators and school officials expressed hope that the integrity of athletics at the school could be rebuilt. DAVID BERST, NCAA: The committee on infractions has imposed a penalty that was intended to eliminate the elements of a program that they did not believe should be continued, but also provided the hope that a program can be reconstructed at the institution, very deliberately and very carefully controlled, that can be sustained and can be built on a foundation of integrity. LEHRER: And now to William Stallcup, the acting president of SMU. The school not only does not have a president now; it is also short an athletic director and/or a football coach. Mr. Stallcup is a longtime member of SMU's biology department, and he joins us tonight from public station KERA in Dallas. Mr. Stallcup, SMU is not going to appeal these penalties. Is that correct? WILLIAM STALLCUP, acting president, SMU: That's quite correct, Jim. We feel that we've had a full and a fair hearing from the NCAA. We've had full cooperation from the enforcement staff of the NCAA. We are disappointed, of course, in the fact that they did impose the penalties that they imposed. But you're right. We do not intend to appeal them. LEHRER: You feel the penalty does not fit the crime? Mr. STALLCUP: No, I didn't say that at all, Jim. I think that perhaps the penalties that we had suggested that they impose would have done the same thing, but would have allowed us to continue in our football program for 1987. LEHRER: In other words, you did not want to be banned from playing this year. Is that it? Mr. STALLCUP: That's correct. Because we feel that there are a number of people on campus who are guilty of no wrongdoing who are penalized to some extent by the fact that we will not be playing football this fall. LEHRER: But you did not challenge and you do not challenge the basic findings of the NCAA as to what actually happened on your campus to your players, correct? Mr. STALLCUP: That is correct. As a matter of fact, it was our investigation that revealed these violations to the NCAA -- our faculty representative, working alongside a representative of the NCAA. LEHRER: Are you satisfied that you're now on top of this situation -- that this kind of thing could never ever happen again at Southern Methodist University? Mr. STALLCUP: Never ever is a strong term, Jim. But I think there are several reasons why it will be difficult for it to happen again, one being the attitude that now exists on the SMU campus and in the Dallas community, that attitude being one of outrage and ''Let's get the problem corrected. Let's get on with our life at the university. Let's build an athletic program that will be competitive and that will demand the respect that the other programs that we have at SMU demand. '' LEHRER: How would you characterize the problem on the campus that led to this serious problem? What was in the air or what was not in the air that caused this thing to happen in the first place? Mr. STALLCUP: For a long -- you, Jim, are familiar with the Dallas scene. You know how important football is in Texas. And I think some people simply go overboard and think they may be doing the right thing in attempting to support the university as they support it. And in this respect, of course, they are misguided. But it's a -- LEHRER: Now -- excuse me. Go ahead. Mr. STALLCUP: I was going to say, there is a sort of win at all cost attitude not necessarily at SMU only, not necessarily in Dallas, but across the Southwest Conference. LEHRER: Now, have you and others now told those folks -- the boosters, the wealthy supporters of your school -- ''We don't want any more of this stuff. We're not going to tolerate any more of this. Please go away and leave our folks alone. '' Mr. STALLCUP: I think the word -- I think the word is out. And that word comes from the leadership of the board right on down through the administration, through the faculty, through the students and the alumni that this sort of thing is not to be tolerated. LEHRER: Now, wasn't there a move afoot for a while among some faculty members to just eliminate football altogether and just say forget it and not even try to come back in '88 or '89 or whenever? Mr. STALLCUP: That was certainly one of what I would call knee jerk reactions that occurred when we found out what was going on. But in late November, I appointed a committee to study the role of intercollegiate athletics at Southern Methodist University. It's to be an open ended study which will investigate all aspects of our sports programs. And we eagerly await the outcome of the deliberations of that committee to see what their recommendations are with regard to a number of things, particularly whether we continue to play football, at what level we continue to play it, and so on. LEHRER: Is it still a viable possibility that SMU may decide to not play Southwest Conference football anymore and maybe play in a lesser league? Mr. STALLCUP: That is one of the possibilities. How strong a possibility it is at this time, I wouldn't want to say. But the committee is certainly looking at all of the possibilities in this regard. LEHRER: What's your own personal view of that situation? Mr. STALLCUP: My own personal view is that if we do it right, as other schools around the country do it right, we can continue to play in at the level at which we're playing, and we can play in the Southwest Conference. We are looking at other schools around the country who have clean programs and who do compete at a high level with other schools. And we will use what we find in helping to determine what our final decision will be in this regard. LEHRER: Do you feel, Mr. Stallcup, that SMU's misdeeds were that unique, or were you part of a pattern, and you just got caught? What's your view of that? Mr. STALLCUP: Jim, we're not going to worry about that. We're worried about SMU, and we are going to do everything we can to get our program straight. What other schools do is up to the other schools. It may well be that some of the steps that we are able to take in remedying our situation will be useful to other schools who may have similar problems. LEHRER: What do you think the message of today's action against you all is for other schools around the country? Mr. STALLCUP: I think the message is to these other schools, ''Watch out. Be sure that you clean up your programs. Get your house in order. '' LEHRER: But is this desire to win and the need to win and the money that's connected with all of that, is that always going to be a problem? Are you ever going to be able to put that completely aside in high powered collegiate athletics? Mr. STALLCUP: I think the winds of change are blowing across the nation, Jim. I believe that with the concern that the presidents have about the sports programs, I believe with the concerns that the membership of the NCAA have about the problems that exist in sports across the United States, I believe that the population in general is going to demand that some changes take place. LEHRER: What kind of changes? Mr. STALLCUP: Once again, changes that would insure that teams -- athletic teams -- have no unfair advantage because they are breaking the rules. LEHRER: All right. Well, Mr. Stallcup, thank you very much for being with us tonight, and good luck to you in Dallas. Mr. STALLCUP: Jim, thank you so much, and thank you for inviting me to be on your program. LEHRER: All right, sir. Charlayne? High Scoring CoachesHUNTER-GAULT: Another issue confronting college presidents is the outside income of coaches. As Tom Bearden reports, there's a major debate underway right now over how much outside income coaches should be allowed to earn.

JIM VALVANO, coach: Work, people. Work hard. Reach that up. Get the ball. Out. Sprint. TOM BEARDEN [voice over]: Since the North Carolina State Wolfpack won the national championship in 1983, the name Jim Valvano has been ranked with the top basketball coaches in the country. Mr. VALVANO: Who's coming after it, Danny? Go right, go right. Good. There he is. Aw, Jenco, you had him. BEARDEN [voice over]: Valvano's style of coaching is sometimes brash, but it's always geared toward winning. The team is struggling this year, but that hasn't diminished Valvano's popularity. Mr. VALVANO: Hello, you're on the air. CALLER: I just want to say how much I enjoy hearing you and watching you, you know, with the NC State Wolfpack. It really brings back like sports should be. BEARDEN [voice over]: Valvano has translated his team's success into solid financial gain for himself. He makes an $85,000 a year salary at North Carolina State, but it's only a small portion of his total income. His weekly radio show is carried on 90 stations throughout the Southeast, and not just during basketball season, but 52 weeks a year. ANNOUNCER: It's the Jim Valvano show, with highlights of North Carolina State basketball. BEARDEN [voice over]: His television show is carried widely too. clip from ad Mr. VALVANO: Like I said, you get great results when you've got the right support.

BEARDEN [voice over]: And there are commercial endorsements from North Carolina automobile dealerships to national brands, such as Nike shoes -- a contract reported to be worth $100,000. The team gets free shoes. Valvano has also become a hot property on the corporate lecture circuit. Each appearance is worth $5,000. All of this is enough to keep any college basketball coach busy, and Valvano has organized his own company to help manage all of his business interests. The vice president of JTV Enterprises is veteran sports broadcaster Don Shea. DON SHEA, JTV Enterprises: How much money do we make? I like to say what Jim says. We haven't filled out the short form on the income tax yet. You know, I think we're probably three quarters of a million dollars. That's a lot of money from -- we're a relatively small company, as you probably have seen. But we get a lot done, and Jim is our principal vehicle. And we exploit that to the maximum. Mr. VALVANO: I love the free enterprise system. I've said this before. My grandfather taught my father and my father taught me that America is a land of great opportunity. And as long as you work earnestly and work very hard, you should enjoy the fruits of that labor. BEARDEN [voice over]: The fruits, according to Valvano, are in jeopardy of being spoiled because of the new NCAA rule requiring coaches to report their outside income to the chief executive officer of their school. Valvano is concerned that the new rules give the chancellors and presidents of NCAA schools the right to approve or revoke contracts for lucrative endorsements. Mr. VALVANO: I mean, where does it say that you're supposed to, you know, make 32,500 the rest of your life? I mean, where does it say that you're not supposed to use your own energies, your own devices, your own quasi intelligence and motivation to become successful? I don't understand. That to me is what this is all about. BEARDEN [voice over]: Valvano thinks the NCAA is trying to promote academic integrity, but he doesn't understand what his earnings have to do with that. Mr. VALVANO: They're trying just to restore a faith and an integrity in amateur athletics. You know, there are people who have looked and said there's too much money at stake. My point is how that gets around to how much money a coach makes. I have trouble making that connection. BEARDEN [voice over]: Christopher Fordham heads the University of North Carolina in Chapel Hill, a school in the same public system as Valvano's North Carolina State. He thinks the new rules were needed to halt the growing commercialization of college sports. CHRISTOPHER FORDHAM, University of North Carolina: Well, I think it's evident that it's gotten too far, that the compulsion to win and the requirement to win to maintain one's head coaching job has become excessive and has further made the colleges captives of the American obsession for sport. There's much that's healthy about sport. And to see that all prostituted for commercial gain is a great pity. BEARDEN [voice over]: The possibilities for commercial gain are not limited to the coach. Each of the four teams in this year's championship tournament will receive $1 million from television and advertising revenues. Next year, it will be closer to $1. 5 million. That money must be split with other teams in the conference, and it's used to cover team expenses. But the leftover is substantial. A national championship pays off in other ways, too, in terms of increased enrollment and contributions from the alumni. The desire to win the championship remains strong, but new proposals to cap earnings for final four participants are being contemplated by the NCAA. Chancellor Fordham, for one, thinks that new restrictions are necessary. Mr. FORDHAM: There are steps we can take. We've taken some already. We'll take some more, I'm sure, to reduce insofar as it is within our control the commercialization of our campus through athletics. It's highly undesirable. I wish I had a simple, quick answer to it. But obviously, it will take wisdom, perseverance and a good deal of prudence to do it over a period of years. BEARDEN [voice over]: Valvano insists that any attempt to limit his personal income will be challenged. Mr. VALVANO: If there was ever an attempt -- and that has been discussed -- of limiting the amount of income, no. Then we go -- then I either do something else for a living, or I take it, you know -- I will go to legal channels. Because now we're talking about I consider something which is very un American. Grace Under Pressure HUNTER-GAULT: We turn now to a look at one of the big winners from last night's Grammy Awards: Paul Simon, who captured his 11th career Grammy for his controversial album Graceland. We've been following that controversy for a number of months. And Paul Simon himself? Well, suffice to say for a lot of years.

[voice over] It was a radical departure from anything that Paul Simon had ever done. The sounds, the sights, the music -- ungaconga, or township jive, plus vintage Simon. The origin: South Africa's black townships. The result: one of those daring leaps that has helped Simon sidestep the fate of so many erstwhile rock and rollers. Now 45 years old, Simon is still adding new and younger audiences to his own aging but loyal generation. But Simon's highly acclaimed musical serendipity has not been without criticism -- aesthetic, but especially political. STUDENT: How can you justify going there, taking all of this music from this country, coming back here and coming to my school where I pay my money and just tell me, ''Look, I went to your country, and I stole this stuff. '' Too long, artists have went and stolen African qualities in their music. How can you just justify going there, taking it, coming back here and telling me this in my face? HUNTER-GAULT [voice over]: When Paul Simon first heard black South African music three years ago, the problems he would eventually encounter never entered his mind. Someone had given him a tape called Gumboots. He didn't know who the performers were or where they were from. All he knew was that he liked what he heard. PAUL SIMON: Hard to explain about why you respond to a certain piece of music or certain type of music. I mean, I reacted to it emotionally, and I also reacted to it on an intellectual level, trying to analyze how did they write this music that seems so simple, but when you try and write it, it's hard. It was really hard. HUNTER-GAULT [voice over]: Hard, but exciting enough that the music sustained Simon through a whole host of early problems. In 1985, he went to South Africa to meet some of the groups behind the music. He signed some of them up, paying them triple American scale. But the first and perhaps the tallest order of business was finding some meeting of musical minds. On a recent visit to New York, Joseph Shabalala, leader of Ladysmith, and Chikapa ''Ray'' Phiri of Stimela remembered those first studio sessions. JOSEPH SHABALALA, Ladysmith Black Mambazo: On the first day, when we met him in London, it was very difficult on the first day. But the second -- HUNTER-GAULT: Why? Mr. SHABALALA: We failed to come together with each other, you see. When he had what we say he think were another way, and then we think another way. And then the next day, I ask him to say -- I say to him, ''Please, Paul, just listen [unintelligible] and just enter where we are. And then the next day it was easy. Mr. SIMON: I sent a cassette to them, a demo cassette, with this -- the English words and melody to ''Homeless. '' And then I said, ''Just use this as a beginning and write anything else that you'd like to it. '' And that's what he did. So when he came there, he showed me a section that he had written in Zulu and the beginning of another section in English, which I then completed. HUNTER-GAULT [voice over]: Whatever the methods, some sort of musical chemical reaction emerged from the initial culture shock. Most of the musicians, from remote villages in South Africa like Ladysmith, were as unfamiliar with Simon's urbane and playful irony as he was with their unexpected rhythmic licks. The result: another unusual element to this unusual collaboration. The rhythm tracks came first, the songs later. [on camera] I read somewhere that you said that ''We were really trying to bridge cultures. '' I mean, is that something you set out to do? Mr. SIMON: Yes. Yes, but not so -- yes, that's what we were trying to do. But I didn't say, ''I'd love to bridge a culture somewhere in the world and, hmm, where? Maybe South Africa. '' No, I just fell in love with the music and wanted to play. HUNTER-GAULT [voice over]: Just fell in love with the music and wanted to play -- a constant refrain throughout Simon's career, a career that started 30 years ago on the far side of New York City's 59th Street Bridge in Forest Hills, Queens. The middle class teenager at Forest Hills High School, playing rock and roll with his pal Art Garfunkel in the school cafeteria; the two of them a small hit in the '50s as Tom and Jerry; a spell in England in the early '60s with the growing folk movement there; then international stardom in the mid '60s as Simon and Garfunkel and their hits like ''The Sounds of Silence,'' ''I am a Rock,'' and: SIMON and GARFUNKEL [singing]: And here's to you, Mrs. Robinson. Jesus loves you more than you will know. Wo, wo, wo. God bless you please --

HUNTER-GAULT [voice over]: The mature Simon now remembers those songs and those times with some ambivalence. Mr. SIMON: I was an English major, and that's what it sounds like, you know? That, coupled with what I knew about rock and roll and recording, since I'd been doing that since I was 15. So I was trying to put these elements together, trying to use my intelligence and my love for rock and roll and combine them and make them together. What I missed -- it was pretentious. But, you know, pretentiousness is the domain of the 23 year old. HUNTER-GAULT [voice over]: More control over his own style, technique and life saw the breakup of his partnership with Garfunkel -- a breakup some ascribe to near sibling rivalry. Simon will only say that it was complex. Whatever the cause, for Simon, it resulted in a new and constant search for musical freshness and growing experiments with other kinds of music: gospel, reggae, Latin. Mr. SIMON: It's a pity that rock and roll seems to dismantle everything it's learned every generation and go back and start again. There's too much value placed on -- there's too much value placed on raw energy and not enough value placed on sophistication. And that's why rock and roll is always repeating itself instead of pushing on. HUNTER-GAULT [voice over]: New York Times critic Stephen Holden. STEPHEN HOLDEN, New York Times: Simon has always been inspired by things that were different from him, things that pulled him out of his own introspective, collegiate, Jewish melancholy. And he really has this instinct for gravitating toward things that are different from him that will bring out an opposite side of him, a positive, joyous side that I don't think he feels, perhaps, a lot of the time naturally. HUNTER-GAULT: Some people have said that Simon the business man had to know that hooking up with South African blacks at this point in the political dynamic was going to be dynamite. Mr. HOLDEN: I think that that's true. I think Simon is very shrewd. I think he has a very acute sense of the zeitgeist. And I don't think he did it for any kind of political reasons or any kind of positive fallout from going to South Africa or anything like that. But I think he has always had an artistic sense of music that was ready to be explored as Paul Simon's. HUNTER-GAULT [voice over]: Whatever the reasons, Graceland turned out to be an unusual album commercially as well as aesthetically. It was released last August. Since last November, Graceland has stayed in the top 20 on the Billboard listing, in spite of minimal radio air play and thanks to word of mouth and heavy promotion by Warner Brothers Records. Simon showed up twice on Saturday Night Live, sharing the evening with some of the South African musicians he flew in for the occasion. Simon also lectured at New York University and UCLA to talk about the music and answer questions. Many of the questions raised have been about the purely aesthetic. ARMAND WHITE, City Sun, Brooklyn: To me, it's the same type of Paul Simon songwriting that I never really responded to before, which I guess is a kind of East Coast, New York, late '60s, pseudo intellectual songwriting, self consciously literary. And that's always kept me from responding to him the way I do to other songwriters. HUNTER-GAULT [voice over]: But simmering just beneath the surface, political criticism that charged Simon with violating the United Nations cultural boycott of South Africa. Mr. SIMON: I didn't think I was asking for trouble, no. But Idid anticipate that there would be criticism. I talked to a lot of people before I went -- civil liberties lawyers here, in South Africa, other artists -- and the consensus was, it was an interesting idea, and it was a good idea, and I should do it if I really felt strongly about it, but not to be naive in thinking that no one was going to criticize me. HUNTER-GAULT [voice over]: The criticism bothered Simon. The harshest came when he visited Howard University, one of the country's foremost black institutions. STUDENT: Ladies and gentlemen, Paul Simon. HUNTER-GAULT [voice over]: The audience was polite but cool as Simon told the story of how Graceland came to be. Mr. SIMON: This all happened -- started in late 1984, when a friend of mine gave me a tape of music that was township jive -- ungaconga. I didn't know where the music came from. It was just music that I really liked. HUNTER-GAULT [voice over]: Simon first played a sample of the South African music as he first heard it. Then he played it as he translated it onto Graceland. The audience listened quietly until Simon finished. Then -- STUDENT: I do not understand this at all. There is no automatic cultural diffusion. It's nothing but stealing. It ain't nothing but stealing. Mr. SIMON: First of all, I was invited there. I was invited by black musicians. They had a very specific purpose. They wanted to get their music out. STUDENT: They wanted money. They need money. Mr. SIMON: Yes, but that's an absolutely valid reason. You listen to this record. You try and make a hit out of that. You think it's easy to make a hit out of it? You think you can just listen to this and then go and say, ''Oh, I know a great idea. I know a great way to steal some money. I'll go to South Africa, I'll listen to some Sutu music, and I'll come back here, and I'll make -- I'll write a song, and I will make money off that. '' STUDENT: Do you feel it's possible that the video of you singing along with South Africans can be used to somewhat make people forget about the violence and what is really going on in South Africa? Mr. SIMON: I don't see why this should make anybody forget about it. STUDENT: You don't see it, because you're part of the plan, my brother. You're part of the plan. Mr. SIMON: I mean, what we're talking about here is, by definition, you've said that I can't understand, I can't see. And in essence, you've said I really can't think. HUNTER-GAULT [voice over]: Eventually, the rancorous exchanges died down, but not before they had shaken Simon badly. The next day in his office back in New York, he had recovered enough to be reflective. Mr. SIMON: You know what my first thought was? I thought to myself, ''I'm just very new at this thing of being middle aged. '' I just sort of got here, you know. I hardly really know about it. The last thing I remember was I was in the audience yelling at the people that came to my college and saying, ''You don't really know anything and, you know, you presume this, and you're stupid. '' And suddenly I realized, ''Oh, they're the kids, and I'm the grownup. '' And I haven't had a whole lot of time in my role as grownup. My second thought was, ''Their view of the world is essentially political. '' And my view instinctually is cultural. And looking at things culturally, as I did with Graceland and I did with the music, there's a political implication. But essentially, I come at the world from a cultural, sociological point of view, and they come at it from -- they want todefine the world politically. HUNTER-GAULT [voice over]: Since that encounter, Simon has continued to appear before audiences both black and white from Harlem's Apollo to Europe to Southern Africa. He's been joined by South African expatriate musicians Hugh Masakaler and Miriam Makaba. And he's been removed from the list of performers who have broken the U. N. cultural boycott of the country -- a list he says he never should have been on, because he didn't actually perform in South Africa; he only recorded music. Mr. SIMON: It's a cliche, but the work speaks for itself. If the work is valid and people enjoy it or feel inspired by it or stimulated by it or even just entertained by it, then the work stands up. I don't believe in this argument of cultural imperialism. I believe that ideas are free to flow across national boundaries. LEHRER: Again, the major stories of this day. A federal judge temporarily blocked a plan to indict former White House Aide Michael Deaver on perjury charges. The New York Times said President Reagan was fully informed throughout the Iran arms deal. The U. S. Supreme Court upheld another affirmative action plan. And Southern Methodist University became the first college ever barred from playing intercollegiate football. Good night, Charlayne. HUNTER-GAULT: Good night, Jim. That's our News Hour for tonight. We'll be back tomorrow. I'm Charlayne Hunter Gault. Good night.