The MacNeil/Lehrer NewsHour

MR. MacNeil: Good evening. A scramble to sell leads the news this Friday. Wall Street's closely watched Dow Jones Average tumbled more than 120 points in heavy trading. In other news, the Iran-Contra conviction of John Poindexter was overturned, and former State Department official Elliott Abrams was given probation for his part in the scandal. We'll have details in our News Summary in a moment. Judy Woodruff's in Washington tonight. Judy.

MS. WOODRUFF: On the NewsHour tonight, a city under siege is our main story. We have a documentary report from journalist Paul Davies, who has spent the week in Dubrovnik in the embattled Yugoslav republic of Croatia. Then tomorrow's Louisiana showdown between David Duke and Edwin Edwards. Betty Ann Bowser reports on where the campaign stands, followed by two columnists well steeped in Louisiana politics. Finally, some words on that and other developments of the week from our regular political analysis team of Gergen & Shields.NEWS SUMMARY

MR. MacNeil: The stock market registered its fifth biggest drop ever today, reflecting doubts on Wall Street about the economy's ability to break free from the recession. The late afternoon sell- off ended with the Dow Jones Industrial Average down more than 120 points, closing at 2943.20. Volume was a heavy 236 million shares and the losses were broad-based. Analysts said computer driven sell orders, concerns over a flurry of negative economic reports, and poor corporate earnings all contributed to the run on the market. Earlier in the day, President Bush told a group of business leaders he was concerned about the nation's economic growth which he described as anemic and slow. But he said he saw some encouraging signs. Mr. Bush spoke to the group via satellite from Washington.

PRES. BUSH: There are some tough economic statistics out there, but right now inflation is under control. That's one self-tax that people don't have to worry about. Interest rates are lower now than they've been in years, and earlier this week, I called for lower credit card rates to take some of the sting out consumer debt. And I'm pleased to see some banks responding. And frankly, I hope more will follow suit, revive consumer confidence, and give this economy a little kick.

MR. MacNeil: White House Spokesman Marlin Fitzwater said that while President Bush would like to see lower interest rates on credit cards, he opposes congressional efforts to set legal limits. He said artificial constraints could be quite disastrous to the banking industry. A compromise bill to extend unemployment benefits threatened to delay passage of the legislation unless some states received more benefits. A compromise was worked out this evening in which each state would get a minimum of 13 weeks of extra benefits. Benefits ran into opposition in the Senate because the bill provided up to 20 weeks of additional benefits to individuals who exhaust the basic 26 weeks of coverage but the amount of extra benefits depended on the unemployment rate in a particular state. Judy.

MS. WOODRUFF: The Iran-Contra conviction of former National Security Adviser John Poindexter was reversed today. In a 2 to 1 decision of federal appeals court in Washington said independent prosecutor Lawrence Walsh had failed to prove that Poindexter's testimony to Congress in 1987 given under a grant of immunity from prosecution had not been used against him at trial. The ruling was nearly identical to one that dismissed charges against former White House aide Oliver North. Poindexter had been convicted of lying to Congress. Also today former Asst. Sec. of State Elliott Abrams was sentenced to two years' probation and 100 hours of community service for his role in the Iran-Contra affair. Last month, Abrams admitted he misled Congress about the diversion of funds to the Nicaraguan Contras. He has agreed to cooperate with Iran-Contra investigators.

MR. MacNeil: A federal grand jury in Washington handed up indictments today against the scandal ridden Bank of Credit & Commerce International and three men associated with it. They're charged with the illegal takeover of the Independence Bank of Encino, California, in 1985. Other charges involved fraudulent stock dealings related to a Miami, Florida savings bank. The men named in the indictment are BCCI's founder, Aga Hasan Abedi, the bank's chief operating officer, Swali Nakvi, and Saudi investor Gaith Farone. The Senate Judiciary Committee today voted to recommend confirmation of William Barr to be attorney general. The vote was unanimous. Barr has been acting attorney general since Dick Thornburgh left the job in August to run unsuccessfully for the Senate. Quick approval of the Barr nomination by the full Senate is expected.

MS. WOODRUFF: Yet another cease-fire was agreed to in Yugoslavia today, the 13th since fighting broke out in the breakaway Croatian republic more than four months ago. That fighting continued to rage today. After pounding Dubrovnik for days, the federal navy turned its guns on the Port of Split. Also in the besieged town of Vukovar, Correspondent David Chater from Britain's Independent Television News was hit by gunfire. We have two reports from Independent Television News, beginning with Norman Ries in the Port of split.

MR. RIES: It was a surprise attack. Yugoslav navy warships began shelling Split just after dawn while most of the town was sleeping. The targets appeared indiscriminate, the apparent objective to terrorize the residents. From this hilltop under their flag, the Croatians returned fire. They were close enough to force this warship to take evasive action. With battle now joined, the warning sirens sent people sprinting for the shelters. These people have seen what's happened to Dubrovnik. Now they fear it may be their turn. For two hours, the bombardment of Split continued. As the defenders stepped up the counterattack, the two warships finally gave up and steamed away.

ANDREW TILLEY, ITN: The battle for Vukovar has raged for almost three months. The civilian population live underground. Anyone above ground is considered a fighter and a target. The federal army's tanks rifle grenades against the lone gunman. The graveyard marks the city's front line. The federal army moved forward. Neither side is prepared to reveal its death toll. There could be as many as 3,000 offenders. But the town will not fall until the last one has left or been killed. David Chater was with a Serbian marksman when his camera crew came under fire -- the sniper in a church across the road. David was hit in the back. Federal army moved in. David was fully conscious, then the dangerous journey to a waiting helicopter and from there to the military hospital in Belgrade.

MS. WOODRUFF: This evening Chater was reported in serious but not critical condition.

MR. MacNeil: Israeli police today recommended that Palestinian Hanan Ashwari be put on trial for allegedly meeting with the PLO. Israel has outlined meetings with the terrorist groups and it considers the PLO such an organization. Ashwari was the spokeswoman for Palestinians at the Middle East peace conference in Madrid. She called the police recommendation "petty and vindictive." Jordan's foreign minister said the move was an Israeli attempt to derail Mideast peace talks. In Washington, the State Department expressed concern about the action and President Bush said he was paying close attention to the case. Palestinians in the occupied territories today marked their self-declared independence day with marches. Most of the demonstrations were peaceful, but a Palestinian in Arab East Jerusalem was killed by police after painting nationalist slogans near the home of Israeli Housing Minister Ariel Sharon. And in South Lebanon, Israeli troops shelled Shiite Muslim villages, reportedly killing three children. The attacks came in apparent response to a bomb attack against Israel last night.

MS. WOODRUFF: Human rights was among a broad range of issues discussed by Sec. of State Baker and Chinese officials in Bejing today. Baker reportedly pressed the officials on political prisoners and other human rights concerns. The U.S. has given China a list of 800 political prisoners and asked that they be freed. The talks also focused on trade and nuclear proliferation, among other issues. Baker's visit was the first by a seniorU.S. official since the 1989 Tiananmen Square crackdown.

MR. MacNeil: Former basketball star Magic Johnson today accepted President Bush's offer to serve on the National Commission on AIDS. He said he hoped to focus attention on what everyone must do to fight the disease. Last week, Johnson announced he was infected with the HIV virus. That's it for the News Summary. Now it's on to the assault on Dubrovnik, the face-off in Louisiana, and Gergen & Shields. FOCUS - UNDER FIRE

MS. WOODRUFF: We begin tonight with a report on the beleaguered city of Dubrovnik, Yugoslavia. The reporter is Paul Davies of Independent Television News who is the only Western reporter left in Dubrovnik. Situated on the Adriatic Coast of Croatia, it has been under siege by the Yugoslav federal army, which is dominated by Serbians trying to suppress Croatian independence. But the past five days Correspondent Davies has witnessed the army's assault on Dubrovnik. Yesterday he managed to smuggle out the pictures his crew has been recording, along with this report on what the city has been through.

MR. DAVIES: It was early Saturday morning when the battle for Dubrovnik intensified, tanks and heavy guns of the Serbian- dominated federal army pouring in fire from their positions in the surrounding mountains. The majority of the city's population took to the underground shelters. But those who ventured outside witnessed the coordinated land, sea, and air attack on their city. Once again the main target of the federal army guns was the Napoleonic fort on Mount Search above Dubrovnik, a Croatian defender's most vital position. Federal navy ships appeared offshore to join the attack. It was not a totally one-sided exchange. Here mortars fired out from the city, falling just short of federal gun batteries hidden in trees on top of Mount Yakovitza. But the federal forces were able to use helicopters to stop targets for their superior fire power. Dubrovnik under fire from the sea and from the air. MiG jets now trying to knock the Croatians from their perch on top of Mount Search. The bombs fell wide of their target. The fort, still intact, opened up with anti-aircraft fire. There was a notable success for the Croatian defenders when their guns hit the nearest federal artillery battery on Mount Yakovitza, igniting an ammunition dump. But their celebrations were cut short when stray bullets ricocheted around the ramparts of the old city. Shells falling into Dubrovnik's main harbor hit one of the ferries that had been unable to leave port because of the naval blockade. It was now impossible for the thousands trapped here to escape the bombardment. Threats of sanctions have made no difference to the federal army. If anything, the fighting has escalated since the latest European community ultimatum. In Dubrovnik hospital, most of the casualties were suffering from wounds caused by flying shrapnel. Doctors say more than half the victims treated here have been civilians. The gunboats appeared to have targeted a Croatian gun post alongside the sea front Belvedere Hotel. The hotel, which had been a home for hundreds of refugees, was all but destroyed by the shelling. Saturday ended as it had begun, with the sound of artillery fire echoing around the old city. Sunday morning in Dubrovnik's Gothic Cathedral they prayed for peace. For many of the congregation this was the first time in days they'd dared to venture out of the bomb shelters. But outside no respite from the bombardment. Indeed, the cross on top of Mount Search almost toppled by an exploding shell. Federal navy frigates appeared off the old city, firing at will safely out of range of the defenders' smaller guns. For hours, shells rained on Mount Search and its battered fort. But some fell short and others dropped into the old city, itself. Until now, the federal forces have concentrated their attack on areas outside the old city. But now their mortars are falling inside the ancient walls. One exploded through the roof of a house built four centuries ago. In all, four mortars fell inside the city walls that day, shrapnel exploding into the convent. The tranquility of the 14th Century Franciscan Monetary, home of Europe's oldest hypothecary, was also shattered. As Friar Josu Sopta tried to tell us about the damage to the monastery, his words were drowned by another attack. As the federal troops closed in, the few residents left on the streets took what cover they could. This woman had risked her life to rescue her dog from its kennel in the old harbor. A day that started with prayer ended with pitched battles in the hilltops. Monday and the famous Strodden, Dubrovnik's main street, deserted in preparation for the inevitable resumption of this one-sided battle. Residential areas devastated with shells falling closer and closer to the old city, for the first time striking its medieval walls. Down the centuries, Dubrovnik's citizens have defied would-be invaders. Now their old ramparts face 20th century war machines. But at least the walls offered some protection. Outside there was no escape. The Grand Hotel, probably Dubrovnik's finest, ablaze. But this was just a fore taste of the destruction that was to follow as the federal forces closed in. Tuesday morning and the attack everyone had feared but most secretly believed could never happen. A deliberate and sustained assault on the old city. This was not a case of shells going astray. It was a calculated decision to irreparably damage a city that is in its entirety a protected monument. Some shells appeared to bounce off the 100 foot high walls, but others crashed into the city. The federal army was now using Soviet-made wire-guided missiles against walls first built to keep out arrows and spears. Missiles landing in the old fort set boats and buildings ablaze. Among the witnesses to the attack was Britain's consul to Dubrovnik, Sarah Marajika, whose husband is Croatian.

SARAH MARAJIKA, British Consul: Nobody ever thought that the old city would be damaged. It's the same way that one thinks of Venice or Paris or Caspray. I think it's important the old city was inviolate, and now it's seems that isn't either. [bombing in background] You know, this was built a siege town.

MR. DAVIES: That's five shells.

MS. MARAJIKA: Five shells.

MR. DAVIES: Five shells as we've been talking.

MS. MARAJIKA: As we've been talking. And that's quite minimal, isn't it, compared to what we have gone through here today?

MR. DAVIES: From the terrace of the Hotel Argentina, the European community observers also watched the destruction, powerless to intervene.

EEC OBSERVER: They're shooting towards the tower in the old city. They just missed us.

MR. DAVIES: But they were forced to run for shelter when mortars fell around their hotel. The observers spent hours pinned down by mortars exploding outside. Plans to evacuate their team by sea had to be postponed because of the raging battle. In the hotel bar, scenes reminiscent of London's East end during the blitz, the locals singing traditional songs to drown the noise of the guns. Britain's consul joining in this attempt to keep up spirits in spite of everything. But a few hundred yards away the destruction continued hour after hour. When the Serbian-led federal forces first laid siege to Dubrovnik six weeks ago, they warned the Croatian garrisons surrender or face the consequences. Few people in the world would have realized that this was what they meant by consequences. The city they call the "Pearl of the Adriatic," its history and its beauty attracted tourists from around the world. Now its ancient structures lit up by flames as its citizens await the next onslaught. Wednesday and Thursday the fires still burned, but at least a respite from the fighting, only now there was another agony. A cease-fire brokered by the EC observers allowed the evacuation of women, children, and the wounded, but only 1600 could go. On the dock side they cued, waiting to discover who would be allowed to board the ferry and who had to stay. Families separated, no way of knowing when they would see their homes again or how many of the husbands and sons left behind would survive. FOCUS - DUKING IT OUT

MR. MacNeil: Tomorrow's gubernatorial run-off election in Louisiana is our main focus tonight. Voters will be choosing between former Democratic Gov. Edwin Edwards, who has been tried and acquitted twice on racketeering and mail fraud charges, and David Duke, a Republican and a former leader of the Ku Klux Klan and Nazi sympathizer. Polls this week show Edwards leading, but even the pollsters agree with Duke's own assessment that he flies under radar. Before our analysis, this report from Correspondent Betty Ann Bowser of public station KUHT-Houston.

MS. BOWSER: This is 41 year old David Duke, who may be elected the next governor of the state of Louisiana. And this is David Duke at the age of 17, when he proclaimed himself a Nazi sympathizer and demonstrated with a swastika on his arm band.

DAVID DUKE: We're going to get to the point where white people in this country are going to be masters of their own destiny again!

MS. BOWSER: And Duke in the 1970s when he was elected grand wizard of the Ku Klux Klan, going about the country preaching superiority of the white race. This is David Duke today. He looks and sounds different. His once brown hair is blond. His broad nose is thinner, reportedly the result of plastic surgery. But that's not all that's changed. Duke says what's inside has undergone a transformation.

DAVID DUKE, [R] Candidate: Well, you know, I've said that I was too intolerant. And there's no question that I was and I have regrets about that in my life, but I live in the present and the future. And I am a Christian.

MS. BOWSER: Are you born again?

DAVID DUKE: Yes, I am a born again Christian and I accept Christ. In fact, the last two years I've had a lot of attacks on my character and if not for my relationship with Christ, I wouldn't be able to be here today.

MS. BOWSER: Duke's current message is aimed at white middle class voters. He wants to clean up the welfare system and he's opposed to affirmative action, set-asides and forced busing.

DAVID DUKE: What hurts us is the crime rate we have, it's the educational problems. What hurts us is the welfare state we're creating here, the drug problems that we have in the state of Louisiana. That's what hurts us.

MS. BOWSER: Susan Howell is a political scientist at the University of New Orleans who has been following Duke's career.

SUSAN HOWELL, Political Scientist: We can't stereotype Duke's supporters. He got 56 percent of the white vote in the Senate race. In his last primary he got 42 percent of the white vote. That's a lot of different types of people.

MS. BOWSER: Howell says most Duke supporters do not see themselves as racist, but her research shows the emergence of a new form of anti-black sentiment.

SUSAN HOWELL: What is happening today is that there is a belief in a stereotype of black people as not living up to the American work ethic ideals, that they are getting favors from government simply because they're black, and that the legal barriers have been removed; now it's time for blacks to join the American mainstream.

MS. BOWSER: Louisiana has been out of the economic mainstream since the mid 1980s, when the oil industry went bust. The state has been unable to diversify its economy and lessen dependence on oil and gas. So today, Louisianans have the lowest annual income in the country, the highest illiteracy rate, and some of the worst pollution problems anywhere. Chemical workers along the Mississippi, from New Orleans to Baton Rouge, have lived through these hard economic times. And many of them feel they have also suffered because of affirmative action. Harold Cambre is a Duke supporter.

HAROLD CAMBRE, Chemical Worker: If I had a son that went to apply for a job at one of these plants because he's a white male he would have to make a high score to get considered for a job, whereas, a member of a minority group could go and make a much lower score and get hired. And I just feel that really and truly the best qualified person should get a job.

MS. BOWSER: How could David Duke change that?

MR. CAMBRE: I don't know that he can change it, but I think that he would probably bring it to the attention of the rest of the country and many people in the state. I really don't know that honestly he could change it but at least he is sort of a person that understands what we're going through.

MS. BOWSER: People like Harold Cambre were once the core of Duke's support, but political scientist Susan Howell says recent polling shows something new.

MS. HOWELL: Duke appeals to a broad cross-section of white voters. He used to be kind of a blue collar phenomenon, but he has crossed the high school diploma line and he does get support from educated white voters.

MS. BOWSER: Ron Courtade is a young attorney who's voting for Duke. He invited some other supporters over to his New Orleans home for coffee to explain Duke's appeal. Among the group were a political science teacher, a businessman and a former executive secretary to three Tulane University presidents.

RON COURTADE, Lawyer: I think David Duke is extremely in line with the philosophy of Ronald Reagan and George Bush.

BUSINESSMAN: I'm a conservative and my parents were Republicans back when it was not fashionable to be a Republican in Louisiana.

MS. BOWSER: You are and you tell me if I'm wrong now, one of the main reasons you're supporting David Duke is he's a Republican, and he is espousing Republican Party politics. You're in a sense almost toting the party line here. Do you feel that you are, Betsy?

BETSY MARCEL, Former Political Science Teacher: Absolutely, yes.

MS. BOWSER: Being a loyal Republican?

MS. MARCEL: Yes.

MS. BOWSER: In spite of the fact that the President of the United States says this man --

MS. MARCEL: I think he did a terrible thing by urging Republicans to vote for a liberal Democrat. It would be like telling people to vote for Michael Dukakis.

JULIETTE COURET, Retired Executive Secretary: It is ironic that he tells the people of Louisiana to vote for a Liberal Democrat when he has spent the last week bashing the Democrats in Washington and blaming all theills of the country on the Democrats. I mean, how can you explain that?

RON COURTADE, Lawyer: I think there has been a disproportionate amount of time spent in this entire election on David Duke's past. I cannot recall the last time a person in a hood or wearing a swastika killed, mugged, robbed, or raped somebody. The people who are committing the heinous crimes are not wearing hoods and not wearing swastikas; they're local thugs who are high school dropouts and drug dependent more times than not. And those folks are the ones who I fear when I go some place in the inner-city in New Orleans, not people wearing hoods and swastikas.

MS. COURET: I don't think we have to fear David Duke's past. I think we have to fear our present and the horrendous problems that all the big cities face in this country. And that is our greatest fear, and I think that's what we should address, because that is the present. And that's the time in which we live, and I don't think we should worry about anyone's past, because people do change. They're changing all the time.

MS. BOWSER: As Duke's appeal spreads to a larger segment of Louisiana voters, some people are asking the question: Has he changed? Political Scientist Richard Murray, a Louisiana native, says no.

RICHARD MURRAY, Political Scientist: Lyndon Johnson said when he went to New Orleans in 1964, the old days when you could campaign and say nigger, nigger, are over. Duke doesn't say that, but he's found out that you don't have to. You can say welfare mothers, the under-class, talk about the spiraling crime wave, talk about the people that get jobs that they don't deserve because government is intervening, and everybody gets the message, those are mostly black folks you're talking about.

MS. BOWSER: Former three-term Democratic Gov. Edwin Edwards is the other candidate in the race.

EDWIN EDWARDS, [D] Candidate: He uses euphemisms, but they know what he's saying and they understand his message and his message is infected by the messenger.

MS. BOWSER: Edwards says he's the candidate who's changed, given up gambling once and for all, and is trying to change his reputation as a womanizer.

EDWIN EDWARDS: I'll certainly say that I am going to discontinue this frivolous attitude I've had about womanizing. The thing is I just laughed and joked about that because so many people that said it didn't know what they were talking about. But I'm 64 years old and I want this opportunity to do something for myself and for my state, and I'm not going to blow it.

MS. BOWSER: Edwards says he wants to leave a positive legacy, to clean up the environment, to bring business back to the state, and he says Duke would be a disaster for Louisiana.

EDWIN EDWARDS: He is playing on their fears and frustrations, anger and resentment. And anytime you play to the darker side of human beings, it becomes very intense, and I understand that we have serious problems in Louisiana. And he's good at articulating the problems. He has yet to come up with a solution.

MS. BOWSER: Edwards' strongest support comes from the black community. In the days following the primary, more than 60,000 people registered to vote, many because they oppose David Duke. Students at Southern University in Baton Rouge made this video as half the students living on campus signed up. Trecia Heatly was one of them.

TRECIA HEATLY, Student: I wasn't serious about voting, you know, one less vote, it's not going to matter, and I was shocked into reality. You know, everybody's heard about his background and I was really afraid, you know, and I was just like, man, you know, every vote really did count.

MS. BOWSER: Edwards also has strong support among business leaders whom Baton Rouge reporter Kelly King Alexander recently surveyed.

KELLY KING ALEXANDER, Reporter: New Orleans is a big tourism city; it gets about a billion dollars' worth of economic impact per year, and convention and Visitors Bureau in New Orleans and also locally here in Baton Rouge are really worried about what, umm, the election of David Duke would do to the state in terms of sending a message out, and, uh, they do not believe conventions and business groups will continue to meet here.

MS. BOWSER: But some voters don't like either candidate. Edwards has been indicted twice on federal racketeering charges and although he's never been convicted, the accusations are worrisome for some people. Incumbent Republican Governor Buddy Roemer, who was odd man out in the primary, agonized over who to vote for.

GOV. BUDDY ROEMER, [R] Louisiana: I care too about you. That's why I'm making a public disclosure of a private decision. I will vote for Edwin Edwards for governor. I cannot, will not, must not vote for David Duke. It would be suicide for Louisiana. And since my choices were only two, Edwards gets my vote. He does not get my endorsement.

MS. BOWSER: Melanie O'Neill is a Roemer voter from Morgan City who is concerned about cancers that may be tied to a waste treatment plant built during the Edwards years. She says she loathes both candidates, but feels she must vote.

MELANIE O'NEILL, Environmental Activist: I cannot vote for David Duke. I mean, the idea is appalling to me. I feel like my father fought, you know, Nazis in World War II. There's no way I could vote for someone like that to be governor of this state. At least I feel with Edwin Edwards there's somebody there who knows how to do the business of the state. It's like corruption I know or a Nazi I don't know.

MS. BOWSER: Which is worse?

MS. O'NEILL: At least the corruption, we're all going to be out there watching Edwin, you know. With David Duke it's too unknown. We don't know what we get.

MS. BOWSER: Anne Guarisco is a neighbor who shares O'Neill's environmental concerns, but she has different plans.

ANNE GUARISCO, Environmental Activist: I voted for Roemer, but I'm going to vote for David Duke now, not because I like him; I think it would be easier to do a recall on David Duke and get him out than it would be on Edwin Edwards, and that's the only reason I'm voting for David Duke.

MS. BOWSER: Whoever wins the governors race will find Baton Rouge attorney Ted Schirmer waiting in the wings, organizing a drive to recall the victor.

TED SCHIRMER, Lawyer: I'm not going to vote for either one of the individuals because I hold my vote too sacred to give it to them. The recall is the purest form of the democratic process. It is the citizens asking a public official who's already elected to come forward for a vote of confidence one way or the other, because these two individuals, whichever one wins, they're going to need that vote of confidence.

MS. BOWSER: Whether Duke wins or loses, it seems clear he will remain active in Republican Party politics. Again, political scientist Richard Murray.

RICHARD MURRAY: The problem with Duke is he never stops. He runs continuously. Either he wins this race, which is perhaps not likely but possible, and is the governor of a Southern state, a Republican governor, who's going to be front and center because he gets enormous media play, or he runs a good but losing race and he, what does he do? Well,he might decide to do what George Wallace did in 1964, enter a few Presidential primaries as a Republican, pick up protest votes against George Bush, particularly if the economy's lousy next spring. You know, this guy, his life is campaigning. He's been a political junkie since he was a teen-ager and he's not going to stop.

MS. WOODRUFF: The contest between Duke and Edwards is also being fought on the airwaves in Louisiana. As one state Democratic Party leader put it, anyone with three red cents has been buying air time. Here's a sample of the messages Louisiana voters have been hearing this past week.

ANNOUNCER: [Campaign Commercial] The interview you are about to hear was recorded on February 17, 1986. The voices are those of David Duke and Joe Fields, a California neo Nazi.

JOE FIELDS: Maybe I wouldn't go out and say I'm a Nazi, but I would never deny it.

DAVID UKE: I wiggle out of it see, because I'm a pragmatist.

JOE FIELDS: You know, Hitler started with seven men.

DAVID DUKE: Don't you think it can happen right now, if we put the right package together?

JOE FIELDS: Most people aren't ever gonna come over until things get tough.

DAVID DUKE: That's a very defeatist philosophy. This government, it may take decades to bring this government down.

DAVID DUKE: Have you ever heard such weeping and gnashing of teeth? The news media have given up any pretense of fair play. The liberals have gone ballistic. The special interests have gone mad. The politicians who play to them are lining up on cue. Principles lie abandoned, hypocrisy rules the day. I raise issues that must be discussed and get back venom instead. Try a little experiment. Next time you hear someone accuse me of intolerance and hatred, notice who's doing the shouting.

MR. MacNeil: Now, we look at the governors race with two observers in Louisiana. In New Orleans, syndicated columnist John Maginnis is writing a book on this election, and Larry English, a columnist with the Shreveport, Louisiana Journal, and a law student at Tulane University. Mr. Maginnis, what do you expect to happen tomorrow?

MR. MAGINNIS: Well, right now I really could be close but I think that Edwards has control of this election and is going to come out the winner. I think there's going to be a massive turnout, both among black and white voters. It might be a record turnout in the state, over 80 percent of the registered voters perhaps.

MR. MacNeil: Mr. English, do you agree with that, an Edwards victory?

MR. ENGLISH: Well, my heart is telling me that Edwin Edwards will probably win the vote, probably around 52 percent, but I've learned like most people here in Louisiana not to underestimate David Duke and I certainly have some concern as to whether or not how accurate the polls are right now that we're seeing.

MR. MacNeil: Are you one of those who believes that the Duke vote is hidden, that some white people don't want to admit they're voting for Duke, that he flies under the radar, as he says himself?

MR. ENGLISH: Well, every election that David Duke has been here in Louisiana that has been the case. He's always polled significantly lower than the turnout that he receives on election day, so I think that certainly has me concerned, as well as other people here in Louisiana.

MR. MacNeil: How big a factor is that, Mr. Maginnis, do you think?

MR. MAGINNIS: Well, even in the polls you're seeing now they have to adjust them for the hidden Duke votes. They're playing voodoo with it anyway. But it's as much as, you know, from the raw vote they've adjusted Duke up ten or twelve points. You know, I think that people outright deceive pollsters. What I think is kind of a healthy idea. You know, I think the pollsters almost think there is not a right to a secret ballot. They're very upset at the idea of people lying to them, but I think obviously in the primary there were many people saying they were voting for Roemer who went out and voted for Duke.

MR. MacNeil: Is, Mr. Maginnis, if Duke loses, is it because voters have been scared off because all the past associations with Duke, the Ku Klux Klan, the Nazis, and that sort of thing, or because he'd just be very bad for the economy, as Edwards has been saying?

MR. MAGINNIS: Well, I don't think Duke is going to lose any voters of which he's already received. I think the ads and the idea of the losing business in Louisiana is preventing him from really penetrating deeply into the middle class. He was, I think, making some real in-roads in there after the primary, but the reality is beginning to settle in on people that, you know, Louisiana could be blackballed and that's not going to help us, regardless of, you know, even if David Duke does turn, try to be a better governor, Louisiana's not going to have a chance.

MR. MacNeil: Apparently, his, his prominence in this election has really galvanized the black voters, Mr. English. What, if he does not win, what do you think is going to be the decisive factor?

MR. ENGLISH: I think it's going to be several things. I think certainly you're going to see a higher black turnout. Probably we're going to break a record here. I'm looking for somewhere between 75 to 85 percent. I think also here in New Orleans certainly the way the business community has come out in force indicating that the local economy here in New Orleans would be, it would be devastated, that would certainly have an impact across the state because New Orleans is certainly the most viable economic area here in the state of Louisiana. I think that those voters who might be on the fence, Roemer voters, and were somewhat undecided about whether or not voting for David Duke in this election, I think that's where you might see David Duke not be able to pick up those votes as a result. Those people may vote self- interest, as most voters do, and that they're going to probably vote for Edwin Edwards out of a self-interest because they're, the things that they like about Duke's program may not outweigh their fear of what will happen if he's elected governor.

MR. MacNeil: Mr. Maginnis, let's tackle this difficult question of what is racism in Duke's appeal, what is naked appeal to race, and what is a, to distinguish it, a respectable raising of issues that many Republicans and others raise and people like Clarence Thomas raise, for example, questioning of affirmative action. How do you, having looked at the Duke support, how do you pull those two strands apart, the sort of what might be called on the national scene the respectable nature of the appeal and the part that nobody wants to associate himself with?

MR. MAGINNIS: Well, I think that the racist part is enclosed inside of the respectable part. I mean, I think there are people who are voting for Duke for both reasons, one, they don't like black people, they think that they're getting too much, and then beyond that, they respond to the same message that Ronald Reagan and George Bush have raised. So I think one is sort of enclosed within the other. I really feel like maybe 1/3 or maybe as much as 40 percent of Duke's supporters is really hard core people who just don't like blacks and a guy like Duke appeals to them. But the rest is a strong conservative vote. We don't really know what Duke's real basis is, is because so far he's run against two fairly unpopular Democrats and a lot of it is a protest vote against the status quo.

MR. MacNeil: Yeah. Mr. English, the South African archbishop, Desmond Tutu, is visiting the states. He was in South Carolina today and he said Duke is making racism respectable. Now, is that a fair comment viewed from Louisiana?

MR. ENGLISH: I think certainly it's a fair comment but I think that Ronald Reagan during his eight years of Presidency helped lay the foundation. I think what David Duke has done is that he seized up on an environment that has been created in this country, that has come from the Republican administration over the last 10 years. Ronald Reagan in many ways used a lot of the same code words that David Duke is using. So I find it somewhat disingenuous when the Republican Party now tries to separate themselves from him. To say that David Duke is making racism respectable I think is to say that maybe David Duke has created David Duke. And I think that David Duke has seized upon an environment that was laid there before he came on the, certainly the mainstream political scene. So I think that you have to look at, at the history of this country and particularly you have to look at the way politicians have openly used the racism issue and the fear that results from it over the last 10 years.

MR. MacNeil: Mr. Maginnis, you heard our piece by Betty Ann Bowser, that group of people who are Duke supporters, rationalizing their support as mainstream Republicanism. Do you run into a lot of Republicans who feel that way, that they're just doing what is in the, has been the main message of the party and that Bush has just now walked away from it?

MR. MAGINNIS: Well, I'm running into, I think most of the people that I talk to at Duke rallies are George Wallace type Democrats, instead of being Republicans. I think that a lot of the Republicans vote for someone else in the primary, Buddy Roemer or Clyde Holloway, and they're reluctantly coming to Duke, and they're only doing so because I think they really don't want to vote for Edwin Edwards and they begrudgingly -- and also a lot of them feel like the Democrats have controlled this state and a vote for Duke would just be a vote to shake things up. I'm also running into a lot of people at these rallies, Democrats and Republicans alike, who have no use for George Bush anymore, and I've heard many of them say they'll never vote for him again. Many of them are very upset that he came out and spoke against David Duke.

MR. MacNeil: To come to the question of what happens if Duke does lose, do you think, Mr. Maginnis, that he's a perpetual campaigner and he'll be back as a Presidential candidate or a Senate candidate?

MR. MAGINNIS: Sure. Sure. It beats working. I think he'll run again. I mean, it is his greatest gift and what he's done for most of his adult life is raise money through his mailing list, and I think that this campaign has increased his fund-raising capability. I think he's the best grassroots fund-raiser since Jimmy Swaggart, and he will just use, he's used this platform. I think he'll go national. Over about a half of his donors in this race live out of state, so I think he's going to -- I could see him entering some Presidential primaries if he loses. I could see him going so far as in '92 or maybe '96 forming a third party and running in the general election for President. I think if he did that, he'd be a terrible threat to the Republican Party.

MR. MacNeil: We have to go to Washington now, but just before we do, neither of you is absolutely sure in saying that Edwards will win and Duke will be defeated tomorrow, am I right?

MR. ENGLISH: No, certainly I'm not. I wish I was at this particular point, I hoped that I would be, but I am concerned very much that David Duke may, indeed, be the next governor of Louisiana.

MR. MacNeil: Mr. Maginnis.

MR. MAGINNIS: I feel a little more confident. I think Edwin is going to win. I've got a bet with one of his body guards. He's betting it'll be over 55 percent. I say under 55 percent, but I think Edwards is close to having it.

MR. MacNeil: Well, John Maginnis and Larry English, thank you for joining us.

MR. ENGLISH: Thank you.

MS. WOODRUFF: Judy. FOCUS - GERGEN & SHIELDS

MS. WOODRUFF: Now for some national perspective on the Louisiana governors race, along with analysis of the political week that was, we turn to Gergen & Shields. David Gergen is editor at large for U.S. News & World Report. Mark Shields is a syndicated columnist. David, whatever happens with David Duke tomorrow, why has he gotten as far as he has gotten? What is it about him?

MR. GERGEN: Well, Louisiana's been in terrible shape for a number of years. There are a lot of people hurting and there are a lot of people very angry. We see in Louisiana what we are seeing around the rest of the country, and that is a frustration, a sense that things are out of control, and David Duke is a voice of protest to them. He also, obviously, is appealing to racial prejudice and a belief, a growing belief, and I think it's something we have to be concerned about in the rest of the country, there is a white backlash in this country now, there is a feeling among a lot of whites who are hurting that somehow they're hurting because the national government has given preferences to minorities, especially to blacks.

MS. WOODRUFF: So, Mark, if he could do well in Louisiana, again, win or lose tomorrow, he could do well in other states, in other places?

MR. SHIELDS: I think that's a possibility, Judy. I don't think it's limited to Louisiana. I think David's absolutely right. It has to be underlined that Louisiana has never come out of the recession. I mean, the oil downturn, the recession of '82, so hard times breed the kind of ground in which a David Duke movement can really grow, where cries and charges of preferential treatment, special privilege, have a resonance that, that combination of social dynamite is quite explosive in that sort of situation. His appeal is not strictly racial by any means. It's endemic to the nation. It's a remoteness of government leadership and unresponsiveness and in many sense of corruption.

MS. WOODRUFF: David.

MR. GERGEN: The kinds of things that David Mathews and others have been talking about on your program this week, this is a reflection of that.

MS. WOODRUFF: The series of conversations we've had.

MR. GERGEN: Yes.

MS. WOODRUFF: How much of a headache has he already been for the Republican Party?

MR. GERGEN: Well, he's an enormous headache and the Republicans in some ways are now in a "no win" situation. If David Duke wins, he becomes an albatross for the Republican Party, he shows up at Houston at the convention as a Republican governor, he tries to go to the Governors Association. On the other hand, if he loses, he becomes a loose cannon. And as John Maginnis just said in that conversation, he may very well decide to run as a third party independent candidate and as a George Wallace type candidate.

MS. WOODRUFF: But not as a Republican?

MR. GERGEN: I think he could run as an independent. Some of his allies have been out checking out how do you get on the ballot as, in places like California, as a third party candidate.

MS. WOODRUFF: They're already checking it out?

MR. GERGEN: They've already been checking that out and the, I don't think he'd get many votes, but the fact is in a close election if he got 3 to 5 percent of the vote, he could cost George Bush the election.

MR. SHIELDS: I think the fear for George Bush has to be, who's in a free fall this week politically, has to be that David Duke would run against him in Republican primaries. David Duke has first of all robbed George Bush of an issue.He's made the quota, affirmative action issue radioactive politically. George Bush can't go near it because it immediately is now talking out of the play book and the prior book of David Duke. So the reelection campaign theme of crime, quotas and Kuwait is gone. So that's the first problem it presents to him, and the second problem, I think David is absolutely right, in a way, 49 percent frees him, it gives him a respectability, if he gets 49 percent on Saturday, to emerge as a man who can charge legitimately a press overkill. I mean, he has been the sole issue in this campaign. There has been a media overkill on David Duke and there's no way --

MS. WOODRUFF: What do you mean, a media overkill?

MR. SHIELDS: There's nobody, Judy, in a non-comatose state who is not aware of the fact right now that David Duke slept under a swastika, went to Heinrich Himmel's birthday party.

MS. WOODRUFF: You're saying there's been too much press coverage?

MR. SHIELDS: Too much. I have no idea, Edwin Edwards, when he was governor of Louisiana, was one of the two or three smartest governors in the country, maybe the smartest, but no one has an idea of what he's going to do as governor. Nobody covers him. He has one event a day.

MR. GERGEN: Can I disagree with that?

MR. SHIELDS: Okay, sure.

MR. GERGEN: I think we have not given enough attention to Edwin Edwards and the best that could be said about him by some of his supporters, Times Picayune editorial endorsing him, saying, at least he's an honest crook, but on David Duke, it seems to me that David Duke has tried to present himself as a born again everything, Christian, everything else he believes in, and the media has a responsibility in those circumstances to expose the man. The fact is his conversion has been at the 11th hour. You know, three years ago he was espousing neo Nazi --

MR. SHIELDS: But is there anybody that doesn't know that?

MS. WOODRUFF: But he's saying there should have been less coverage.

MR. SHIELDS: I think at some point you ought to have an idea of what the next governor is going to do. I mean, a good friend of mine from Louisiana said, and Edwin Edwards was always, when told about David Duke, Edwin was a notorious skirt chaser. Now he says he's retired and reformed himself, said, well, they used to say I was a wizard under the sheets as well, and Edwin Edwards is somebody who a friend of mine from Louisiana described having Edwin Edwards for governor was like having a drunk for a daddy. It's funny to everybody else in town but it's kind of tough on you. And I don't think there's been the kind of attention given to Edwin Edwards in this campaign as there should have been.

MR. GERGEN: But I would say this. I think that Duke is forcing us to look deep into our souls as a country and say, is this what our politics is coming to, and that's a healthy thing,and I think the fact is that you're right about, the quota issue has become radioactive and maybe we're going to have a more honest discussion about race and race relations in the next campaign, and that will be healthy for everybody.

MS. WOODRUFF: Well, speaking of problems for the President, and Mark, you just said he was in a free fall. I gather you mean in the polls.

MR. SHIELDS: Yes.

MS. WOODRUFF: He also has another challenge apparently. He may have somebody challenging him for the Republican nomination, namely Pat Buchanan, the television commentator. Is that something for George Bush to be worrying about at this point?

MR. SHIELDS: George Bush right now is faced this week with the prospect of having to run to the left of David Duke and to the right of Pat Buchanan. Now I don't know how he's going to do that. I mean, he's got two potential primary challengers. Pat Buchanan is a serious person, he's never held office before, but he is willing apparently to forego a very prominent position.

MS. WOODRUFF: Worked in the Nixon White House.

MR. SHIELDS: Worked in the Nixon White House, was a speech writer for Richard Nixon, was communications director, succeeded my good friend to the left here in the Reagan White House as communications director in the second term, but he represents a conservative movement I'm not sure is still there. I'm not sure it's still there in the sense that Ronald Reagan embodied that conservative movement. I think an awful lot of conservatives believe what was achievable Ronald Reagan achieved. What wasn't achievable, Ronald Reagan tried to do, whether it was school prayer or abortion or whatever, and Pat is, I think, going to find out that probably the anti-Communism, which was the glue that held that conservative movement, is gone, and I think that add to that the fact that the religious right has sustained in Jimmy Swaggart and Rev. Jim Baker some really serious body blows.

MS. WOODRUFF: But, David, there's a lot of talk though about what Pat Buchanan could do in New Hampshire which is after all the second Presidential contest.

MR. GERGEN: I think that it's no question that Pat Buchanan can be much more than an irritant to the White House and we should say both of us are friends of Pat, colleagues, and that sort of thing. It seems to me that there is -- conservatives tell me that they think he can get 25 to 30 percent of the vote in New Hampshire. New Hampshire's been very hard hit by the recession.

MR. SHIELDS: That's true.

MR. GERGEN: And there are a lot of conservatives -- Mark, I think the conservative movement was declining; I think it's on a rise again. There's a new wave of it, and that they feel very strongly, the conservatives do, that the President has capitulated to the left on one issue after another, starting with the increase in taxes that he signed on to a year ago, on the quotas, on more regulation of government, and they see Pat Buchanan as someone not only who can be a voice of protest, but can put pressure on the President to pull back to the right because this White House has a history of essentially listening to pressure and responding to it.

MS. WOODRUFF: So you're saying he's got a potential national constituency, not just people who are frustrated about the economy in New Hampshire.

MR. GERGEN: I think he can cause real problems in New Hampshire.

MR. SHIELDS: Two points. One, I think David is right on the fact that there's a sense of a conviction deficit in the Bush administration. I mean, if there's pressure applied, they respond and they react. There's no doubt about that. But I do, I have to come back to the fact that George Bush is seen by conservatives as not an agenda item, it's a visceral. They see that he's not one of them. He really doesn't believe what they believe. He's never been -- he presented himself in 1988 as a Republican nominee as a sort of Tonto to the Lone Ranger Ronald Reagan, that he had been loyal, faithful, but not that he really shared those same convictions and passions that Reagan. Pat does. And Pat is a passionate, true believer. What you see is what you get with Pat Buchanan.

MR. GERGEN: What the administration, what the President is going to have to do is sit down and figure out what he really stands for and hold tight. I mean, he's done two things in the last few days which I think people have just been stunned by.

MS. WOODRUFF: You think he's figured that out by now?

MR. GERGEN: Judy, in just the last few days what have we had? We've had -- he called for reducing credit, the credit card rates from 18 percent down to 14 percent. The Congress said let's go along with this, and what do we have today? The stock market dropped 120 points. You know, Washington, if you can't do well, should at least try to do no harm.

MS. WOODRUFF: Well, David Gergen, Mark Shields, we'll see you next week. Thank you. RECAP

MR. MacNeil: Again, the main stories of this Friday, the stock market suffered its fifth biggest loss ever, dropping more than 120 points. The Senate tonight passed a $5.3 billion bill to extend unemployment benefits and sent it to the President. The Iran-Contra conviction of former National Security Adviser John Poindexter was overturned, and former Asst. Sec. of State Elliott Abrams was given probation for his role in the scandal. Good night, Judy.

MS. WOODRUFF: Good night, Robin. That's our NewsHour for tonight. We'll be back Monday night with analysis of the results of the Louisiana governors race and an interview with White House Chief of Staff John Sununu. I'm Judy Woodruff. Thank you and have a good weekend.