The NewsHour with Jim Lehrer

JIM LEHRER: Good evening, I'm Jim Lehrer. On the NewsHour tonight, the American century, as seen by Jessica Mathews, Tom Friedman and Jim Hoagland; a Jeffrey Kaye report on Internet shopping, the hot new way to buy; a Ray Suarez look at a new treatment for asthma; and a Paul Solman trip through the art collecting of Duncan Phillips. It all follows our summary of the news this Thursday.

NEWS SUMMARY

JIM LEHRER: Federal prosecutors in Vermont said today a woman arrested at the Canadian border has terrorist ties. They said she's linked to an Algerian group with connections to attacks in Europe and Algeria. The woman is a Canadian citizen. She and an Algerian man were arrested Sunday. Also today, U.S. postal inspectors were checking mail from Frankfurt, Germany. The F.B.I. warned that package bombs could be sent to the U.S. from there. Bethlehem went about its Christmas preparations today, despite concerns about terrorism. Palestinian authorities put about 2,000 extra policemen on duty to guard against attacks, as tourists continued to flock to the region ahead of the holiday. Bethlehem's mayor sought to reassure the visitors.

MAYOR HANNA NASSER: The city is ready, and we welcome every visitor to the city. We don't have any reservations on the entrances. The city is open, it's free. It is stabilized from all points of view.

JIM LEHRER: Palestinians and Israelis hope to draw thousands of tourists to Bethlehem for Christmas and year 2000 celebrations. International aid for flood and mud slide survivors poured into Venezuela today. Workers unloaded supplies at the Caracas airport. The United States sent a military cargo plane with water purification machines. Relief officials said they would concentrate now on distributing aid to isolated areas. The disaster destroyed 23,000 homes. Estimates of the dead go as high as 30,000. In Chechnya today, Russian forces fought rebels along the borders, and they tried to block guerrillas from breaking through to neighboring regions. The siege of Grozny continued, but Russian Prime Minister Putin said nearly all of Chechnya was now under Russian control. He said troops were eliminating what he called "pockets of resistance." On Wall Street today, a rally in technology and Internet stocks pushed the markets to new records. The Dow Jones Industrials closed up 202 points at 11,405. That was a gain of 1.8 percent. The NASDAQ Index was up 32 points to close above 3969. Astronauts worked today to install a new computer in the Hubble space telescope. They did so on the second of three space walks aimed at getting Hubble operating again. It's been shut down since November. NASA said even the new computer lags behind current desktop models. That's because it takes four years to test equipment for space. Astronomer Anne Kinney explained in an interview this morning.

ANNE KINNEY: The computer is being upgraded, and this is kind of... by earth standards it's kind of a pathetic computer, but by space standards it's an excellent computer. We're increasing memory by a fact of 20 and increasing speed by a factor of 6.

JIM LEHRER: There's been a breakthrough in treating asthma. Scientists at the national Jewish medical and research center in Denver did the work. It involves an experimental drug that allows many patients to stop taking steroid medications that can have dangerous side effects. The findings were published today in the "New England journal of medicine." We'll have more on the story later in the program tonight. Also coming, the American role; Internet shopping; and the art of Duncan Phillips.

FOCUS - THE AMERICAN CENTURY

JIM LEHRER: Some end of the century thoughts and to Terence Smith.

TERENCE SMITH: To discuss the U.S. and the world at the end of what is often called the American century, we're joined by Thomas Friedman, foreign affairs columnist for the "New York Times" and author of "the Lexus and the Olive Tree, Understanding Globalization" and by Jim Hoagland, foreign affairs columnist for the "Washington Post" and by Jessica Mathews, former official in the Carter and Clinton administrations, editorial page writer and columnist from the "Washington Post" and now president of the Carnegie Endowment for International Peace. Welcome to all three of you.

Jessica, if this is the end of the American century, as it's called, and we're this sole remaining super power, hyper power as the French foreign minister called us, how well or poorly is the U.S. exercising that power?

JESSICA MATHEWS: Well, I think... I wish I could wrap up the century in a more positive and definitive way but I think we're in the last year-and-a-half acquiring a case of what I call a Hedgemon's Disease, the mistakes that every Hedgemon in history has made until now and which I think we believed we were different and wouldn't. I think there's some evidence that we're starting the make the same mistakes.

TERENCE SMITH: What mistakes?

JESSICA MATHEWS: The inability to make choices, even among our own conflicting goals, the desire for perfect security, the desire for...to have everything our way, difficulty of taking other countries' interests... taking them seriously. And diplomacy is the art of making choices. And when you start to lose either the desire or the willingness to do it, you get in trouble. Then, of course, the results of Hedgemon's Disease in every case until now has been that you encourage others to gang up against... to unite against you. And that seems like a pretty remote possibility but certainly the intermediate steps are that you are less able, and I think particularly in this world where so much depends on cooperative efforts, you're less able to achieve your own goals.

TERENCE SMITH: Jim Hoagland, does that sound to you like a portrait of the United States on the eve of 2000.

JIM HOAGLAND: I would agree with a lot of what Jessica said but I think I'm probably less pessimistic. I think, in fact, there's strong reason to believe that the United States is exercising its power well and will continue to do so for some foreseeable future in this next century. The United States is in the midst of what has to be now considered a long economic boom. We've seen this once or twice before in this century where the application of technology, the innovation both in terms of incentives and productivity all combine to shelf or suspend at least temporarily the ordinary business cycle and really to transform not only the American economy but the world economy. I think that's a big plus that carries us forward. Something of the same is happening in military and security affairs. We're having this big debate, we're going to have this big debate at the beginning of this century about a national missile defense and protecting American territory from ballistic missiles. It's an indication of a desire to chart our own way. We have to temper that and we have to be very careful about giving the rest of the world the impression that we want to be very selfish, very unilateral. I think we can manage that. We have in the past. We have to remember, I think, that the United States is always a reluctant Hedgemon, if at all.

TERENCE SMITH: Tom Friedman, do you think the United States is using its power well?

THOMAS FRIEDMAN: Yeah, I think more or less. If you look back at just the crises of the past five years basically, Mexico went into a meltdown. We catalyzed the economic response to that. Asia went into a meltdown. We catalyzed the economic response to that. Bosnia, Kosovo. None of these were done perfectly. Some of them were done late and under reluctance, but we were tilted in the right direction, it seems to me, all the time. I understand what Jessica is saying. I think if you listen to the debate here, you could walk away-- as many foreigners do-- as thinking that we are becoming at least an obnoxious Hedgemon -- the missile defense that Jim spoke about. We're just going to tell the Russians what to do, sorry. Fortunately so far, you know, when actual rubber meets the road, we tend to be, I think, more open to discussion, more open to finding out a way to be a shaper so other people will be good adaptors with us rather than just kind of using what is our overwhelming economic now and military clout to simply assert our own way.

JESSICA MATHEWS: There's an awful lot in this kind of in process right now. This national missile defense decision is one that I think promises, if we handle it wrong, tremendous pain with both Russia and China and the possibility of ourselves starting an arms race with China. And we haven't mentioned the Senate's decision to reject the comprehensive test ban, which I think one has to put here and say, what was the U.S. saying to the world? And I don't want to sound too negative because I think all the things that worried me are still in process, in a sense, but if it comes out wrong-- for example, if we can't get back on the CTB, or if we do the wrong thing on national missile defense, which I think we very well may, if we push the Russians into a feeling where their only international role is as a spoiler, they can spoil a lot.

TERENCE SMITH: Jim, you started to say something.

JIM HOAGLAND: Well, I think it is precisely because we are in process because we are at a moment I think it's relatively rare in human history. Last time I can think of is the end of World War II and the beginning of the atomic era. We're at a moment when the future is now. In country after country around the world people really have the sense that what is happening in the months, years ahead, immediately ahead, the next two or three years is going to determine patterns of behavior: Economic behavior, political behavior, military behavior, for decades to come. So it's a very exciting moment and one that we have to really seize and makes these patterns become ones that we are very comfortable with and benefit not only the United States but the rest of the world.

TERENCE SMITH: That goes, Tom, to the question of defining the role of the U.S. in the post Cold War world. We're now in the midst of what is the third presidential election since the fall of the Berlin Wall. Are we getting any closer to that definition?

THOMAS FRIEDMAN: To listen to the debates right now, you'd have to say no. It seems to me we have a very clear role out there, and it's I think quite easy to define and it's what I would call sustainable globalization. I think the biggest thing happening out there is this phenomena that we call globalization. And, if you look at it, it is our ideas, our people, our technology, hopefully our values that are actually being globalized. We have a huge interest in making this sustainable, and the way you make it sustainable, partly by what Jim talked about, by democratizing it, by widening the winner's circle, by using our health, our technology, our wealth to bring more people into this system. That's one dimension of it. And the other is what Jessica alluded to, by also stabilizing it as a super power, providing the under girding of it because, you know, there is no hidden hand without a hidden fist. This system needs basically a power to hold it together. So it seems to me our sort of broad strategic interest after the post Cold War is quite clear. Unfortunately, we're debating ethanol right now in Iowa.

JESSICA MATHEWS: But I think it's not so clear the sense, that I would agree. It's a revolution that's happening, and it's a steerable revolution. It's not one that is self-executing and will just march along in any direction, but I don't think we have a clear sense of where we want to steer it to. Nor do we have a clear sense-- and it's evidenced by the fact of the debate about ethanol-- whether we want to and whether we have the political will.

TERENCE SMITH: You mentioned Russia before, and the possible spoiler role. I mean, here we've spent much of this century that's coming to an end dealing with Russia one way or another, as the Soviet Union or as Russia. Where does that stand, that U.S.-Russian relationship at the end of the century?

JESSICA MATHEWS: Right at this moment in a very par less state. We have put in front of the Russians a take it or leave it proposal on the ABM Treaty. They are clearly... were deeply affected by the Kosovo action in that it was not irrelevant to what happened now in Chechnya. I think there is... we are finally seeing, as we should have expected to, the feelings of an empire shorn overnight of its power and prominence and self-respect in that Chechen war.

TERENCE SMITH: And frustrated nationalism.

JESSICA MATHEWS: And a tremendous poverty and economic suffering among... where there was a lot of hope. So things in Russia are very, very tough. And with a very fledgling, such as it is, democratic system, as we could see in that vote. And now comes along this decision on national missile defense coupled with the comprehensive test ban which raises for Russians the fear that we are about to abandon deterrence, which has been the basis in favor of unilateral defense. That is scary because for them their entire security now depends on nuclear weapons. Their conventional strength is gone.

TERENCE SMITH: Is it a less safe world, Jim, even though we are this dominant super power?

JIM HOAGLAND: Certainly not less safe than it was during the Cold War. I mean, but to try to figure out exactly where Russia is going to be in a year or even ten years I think is a game at this point. I think we really need to try to move beyond the Cold War. To come back to your original question, I don't think the politicians have done a very good job of moving beyond the Cold War. We're still talking about Start II ratification, we're still talking about Chechnya, which is really a last gasp, as well as Milosevic's wars in Yugoslavia. This is the past. The people, I think, have moved far beyond the Cold War. If you look at what really is on the minds of the population in the United States or even of Russia, it's not Start II. It's questions about science. It's questions about technology. If you look at the science of the next century, it's clearly going to be biology. Science of the 20th century was physics. Science of the 19th century was chemistry -- I mean the science that produced the greatest advances, the greatest reputation. So we look at biology and it's going to create incredible questions that people are following very closely. Within the lifetime of I think probably of all of us but certainly our children, you'll be able to clone yourself -- in an era of organ transplants, you can prolong your own life great amounts of time.

TERENCE SMITH: So a brave new world.

JIM HOAGLAND: Do you want to do that? That's what people are thinking now.

JESSICA MATHEWS: I don't think that's on the minds -

JIM HOAGLAND: That's the political choices that people are going to make. On the minds of Russians I think very much is the great decrease in adult mortality among men that has occurred in the last ten years and how do you avoid that? How do you avoid dying? I think that's very much on the minds of the Russians.

TERENCE SMITH: Tom, we probably shouldn't conclude this without talking about China. Surely that's one of the big questions to be addressed at the dawn of the 21st century.

THOMAS FRIEDMAN: Well, you know, I think there's a lot to be encouraged about with what's going on in China. As someone who tries to go there every year, I am struck that it is a more open place every time I go there. But there is a huge speed bump down the road for China, and that speed bump is that transition that Russia, in its own messy, ugly way, is over and it is the transition from an authoritarian regime to basically a free-market democracy. And I think when 1.3 billion people going 80 miles an hour hit a speed bump, it gets real interesting, and that, I believe, is going to be I think the most important thing that happens in the world, I would say, in the next ten years: How they get over it. I think the biggest challenge for American foreign policy is actually going to be managing their weakness as they face that speed bump, not their strengths.

TERENCE SMITH: That's a thought.

JESSICA MATHEWS: And that's been the tricky part with Russia is learning how to deal with its weakness rather than its strengths.

TERENCE SMITH: Thank you all three very much. Jessica Mathews, Jim Hoagland, Tom Friedman, thanks.

FOCUS - PROFITS AND PRIVACY

JIM LEHRER: Now, the Internet goes commercial. Jeffrey Kaye of KCET-Los Angeles reports.

SPOKESMAN: Log on to...

JEFFREY KAYE: Internet merchants are flooding the airwaves and the highways with advertising. With online sales this year estimated at $14 billion to $20 billion, there is intense competition to get customers to distinguish one dot.Com from another. Gregory Hawkins is chief executive officer of buy.Com.

GREGORY HAWKINS: We face the same challenge that many of our competitors face, which is trying to break through that clutter.

JEFFREY KAYE: Buy.Com is among the top selling online retailers, with a range of products, including computers and software. But like other merchants, buy.Com uses the Internet not just for sales, but for marketing, by obtaining information about visitors to its sites.

GREGORY HAWKINS: I can tell where you're buying, where you're looking, what pages you're looking at, what ads you're reading, what types of information you're trying to gain access to. At the end of the day, what we're most interested in is where you're browsing and where you're buying.

JEFFREY KAYE: How will that help you?

GREGORY HAWKINS: Well, certainly it gives us a chance, over time, to communicate with you, to create that personalization that we're talking about here.

JEFFREY KAYE: Internet shoppers click on products to get facts and to make purchases. Buyers provide their credit card and shipping information. Many online retailers store the data to target sales pitches to repeat customers. Such marketing, known as "personalization," is a hot tool for Internet retailers. But it's also the subject of concern among Internet privacy advocates. Deirdre Mulligan is a staff attorney with the Center for Democracy and Technology, a nonprofit group. At a mall near Washington D.C., she described how online businesses glean information for marketing. If this shopping center were online, each store visit would be recorded by a click of the computer mouse.

DEIRDRE MULLIGAN: And all of the information that you've left behind, the products that you "picked up" by clicking on them, and even the purchases you make, can be fed into a single database to create a profile of what you do when you're on the web.

JEFFREY KAYE: And that can be used at the next store.

DEIRDRE MULLIGAN: That can be used at any store that's part of the network.

JEFFREY KAYE: Mulligan says an online retailer may know what we want before we get there. So now as we go to a department and find something, what might be awaiting us?

DEIRDRE MULLIGAN: Well, the web site knows a lot about what you do at its site. And so it may actually put things in front of you that it knows you're interested in, based on what you... maybe you bought a red shirt upstairs, and they're going to show you red shoes downstairs.

JEFFREY KAYE: So as we now peruse the shoes, what else is going on?

DEIRDRE MULLIGAN: Well, in the real world people know what you've purchased, but in the online world, they know actually what I considered purchasing.

JEFFREY KAYE: Finally, if a purchase is made, even more personal data-- a name, address and credit card number-- are recorded.

DEIRDRE MULLIGAN: And so that information can now be combined with all those footprints that we left behind about what we looked at and what we liked, not just at this store, but potentially, at other stores.

JEFFREY KAYE: The boom in online profiling, marketing, and selling reflects the transformation of the Internet. Once a medium for scientists to exchange data freely, the web has rapidly evolved into a tool for commerce. Online advertising agencies such as Doubleclick, Inc. are thriving. Company President Kevin Ryan says everyone benefits from the commercialization of the Internet.

KEVIN RYAN: I'd love to have the Internet for free, and that's what people are getting right now, and it's thanks to the advertising. That's the tradeoff.

JEFFREY KAYE: Doubleclick, Inc. has turned Internet advertising into a science and into a gold mine.

SPOKESMAN: I can tell you --

JEFFREY KAYE: Doubleclick officials expect revenues this year will be about $300 million, up more than threefold from last year. Doubleclick advertising is, targeted, customized, and prolific. During our visit, the company's control room recorded a delivery rate of 18,899 ads each second.

KEVIN RYAN: Today we will deliver about a billion ads. Just like that. In one day.

JEFFREY KAYE: With powerful computers and super sales, Doubleclick delivers tailored ads to target audiences. Web site visitors see ads that come not from the sites themselves, but from Doubleclick.

KEVIN RYAN: Why don't we take a look at a site like Dilbert: Very successful Internet site...comic strip site. This site comes from Dilbert, but actually I put my cursor over the advertisement right here, and I can see at the bottom of the screen that it comes from Doubleclick.

JEFFREY KAYE: But Dilbert.Com has nothing to do with providing this ad, this banner ad, you provide it?

KEVIN RYAN: That's right. We have a relationship with Dilbert, we have had for years now. But since the beginning of the web site, we've sold and delivered all the advertising.

JEFFREY KAYE: The ads on a web site can be targeted according to advertisers' requirements. Doubleclick's computers, for instance, can quickly identify a web surfer's Internet address. That's like a phone number. It consists of a unique string of numbers which can be decoded to obtain information about a user's computer, its Internet connection, and location. The data allows Doubleclick to deliver different ads to different regions.

KEVIN RYAN: I was in Sweden the other day, and the ads on the Dilbert site that we just saw were in Swedish.

JEFFREY KAYE: If a user logs on from a company, Doubleclick knows that. A recent ad campaign targeted students on line from colleges.

KEVIN RYAN: We know where every university is. It's matched up, and it's in a database. And so we can just tell which banner to serve to them. So it was 300 universities. We got incredible response rates.

JEFFREY KAYE: Online marketers also use devices called "cookies" to track the behavior of Internet users. Cookies are small files that record information about a user's visit to a web site... the site transmits the data back to a user's computer and then reads it when the user returns to the site. Sometimes users don't know the information is collected. Other times they willingly provide it. Homegrocer.Com, for example, sells and delivers groceries to homes in the northwest and in Southern California. Its cookies are not only the edible variety, but are also digital data. The company uses cookies to identify repeat visitors, their locations and previous purchases. Some consumer advocates worry when information is collected without the user's knowledge.

DEIRDRE MULLIGAN: I think for many individuals, the fact that somebody unbeknownst to them whom they've never known, never chosen to do business with is collecting information about them, about activities such as what they're interested in, what they're reading, without their knowledge and certainly without their consent is troubling at the very least.

JEFFREY KAYE: But Jeffrey Bennett, a vice president of the Lycos web site, says computer users often provide personal data because they receive a valuable service.

JEFFREY BENNETT: Increasingly, customers are coming to us and they want more information that's relevant for them. So they want to tell us that they are living in New York, so that they get the weather about New York, not the weather about Albuquerque, New Mexico. So increasingly, consumers are registering with us, so that they'll get more and more information that's relevant to them.

JEFFREY KAYE: They're also getting more and more ads. Lycos is a search engine, which are among the most popular web sites for consumers. Users seek information by typing in keywords. Once bare-boned, search engines are increasingly crammed with ads. Lycos made $93 million from advertising in the past year. Like other search engines, Lycos sells advertising rights to keyword searches. Clients pay up to $100 for every 1,000 times their banner ad appears in response to a search. But sometimes it's hard for consumers to know what's paid for and what's not.

JEFFREY KAYE: All right, so now we've put in "camcorder," and we've got a number of things that we're seeing. Up here the banner ad is for camcorders.

JEFFREY BENNETT: That's right. From an advertiser of ours called 888-camcorder. And you also have an ability to go to Barnes & Noble to look for camcorder books.

JEFFREY KAYE: And here: "Buy camcorders at Lycos shop, buy and sell photos and electronics," and again another "start here." Maybe we can click that on. "To save money on camcorders and electronics." And that takes you to... the Supreme video.

JEFFREY BENNETT: The Supreme video. Right.

JEFFREY KAYE: Where it says here, "start here," "click to save money on camcorders and electronics," does that mean that you, Lycos, have determined that that's the place to save money?

JEFFREY BENNETT: That is a promotion that the merchant is actually paying to have placement there.

JEFFREY KAYE: Do the people who use the Internet, do you think they know these are commercial pitches, or do they think... are they perhaps slightly misled and think at these may be objective?

JEFFREY BENNETT: I don't think that there's any dissuasion going on here. I mean, we're trying to provide information to the consumer. They've keyed in "camcorder," and they want information about the camcorder.

JEFFREY KAYE: At buy.Com, there is also a fuzzy line between product information and marketing. The site lists "great buys" and "top products." Those are not neutral editorial recommendations. Vendors pay for prime positions. How does the customer know?

GREGORY HAWKINS: The customer has no idea, if you will, whether a vendor has paid for a position or not paid for a position. To the extent that a vendor has a solid product and they want to provide a premium merchandising position, we will work with them.

JEFFREY KAYE: Consumer advocates want online businesses to be more up- front about how they gather information and what they do with it.

DEIRDRE MULLIGAN: On the Internet, everybody is trying to figure out how to get a workable business model. How do you support all of the free content on the web? And what in fact you're finding out -- the content is not free, it's just that you're paying for it not with money, you're paying for it many times with your information. So this information is viewed as an incredibly valuable commodity, the more people can target ads to people who are going to be interested in their products, the less they have to advertise, the less money they have to spend on advertising. So there's a real tension in this particular business model and individual privacy.

JEFFREY BENNETT: Without question, there is tracking of information that many companies are doing to build their base of... to build their base. But we're not doing this in a way that is Machiavellian. And that is, in many ways, how we derive our revenue base, through advertising and increasing activities by helping sell things. So we are picking more and more revenues from transaction share. But I don't think that's all that bad. I just think we need to be very cognizant and respectful of the line that we walk down, with respect to the kinds of information that can be shared.

JEFFREY KAYE: Many sites have privacy policies that explain how information is collected and what's done with it. Sometimes consumers can opt out of targeting efforts. Computer users can modify settings to block or restrict the placement of cookies. And on the Internet, where just about everything else is for sale, a growing industry is selling software to mask identities and protect privacy.

JIM LEHRER: Still to come on the NewsHour tonight, a new asthma treatment, and one man's eye for art.

FOCUS - BREATHING EASIER

JIM LEHRER: The news on asthma, and to Ray Suarez.

RAY SUAREZ: Over the last two decades, the rate of asthma has more than doubled in the United States. An estimated 17 million Americans suffer from asthma today. That includes nearly five million children, making it the most common chronic childhood disease. Asthma is responsible for 5,500 deaths annually. For years, steroids have been a standard treatment, but they also pose side effects over time. Now a study in today's issue of the "New England Journal of Medicine" finds that a new experimental drug may provide treatment with fewer side effects. For more, we're joined by the principal researcher on the asthma study, Dr. Henry Milgrom, director of the Ambulatory Pediatric Allergy Program at the National Jewish Medical and Research Center in Denver, Colorado; and Dr. Michael Kaliner, director of the Institute for Asthma and Allergy at Washington Hospital Center, and former director of allergy and asthma at the National Institutes of Health.

Dr. Milgrom, this is good news, I guess, but what keeps us something short of declaring victory and going home?

DR. HENRY MILGROM: Well, what keeps us short of declaring victory is that this is a preliminary kind of study which will need to be expanded upon. We have been very gratified by the results. The patients that we treated all did very well on the drug. They were able to reduce their corticosteroids over a fairly short period of time and continued to do well clinically in spite of the reduction of corticosteroids...in fact, continued to improve clinically both in symptoms and in pulmonary function studies. The reason why we cannot declare a victory just yet is because this was a relatively small group of patients. And they were not studied for a very long period of time.

RAY SUAREZ: Wasn't there also a subsection of the population in general that it turns out that this is better treatment for -- something that doesn't cover everybody from pediatric to geriatric cases?

DR. HENRY MILGROM: Well we selected patients who had documented allergies. I think that in pediatrics, you can safely that virtually all the children with asthma are allergic and a majority or great majority of the adults with asthma are also allergic. So we did not really limit the population that much, but I think that perhaps what we need to do is to determine which groups of population actually are most likely to benefit from this. You know, asthma is probably not a single disease but rather a group of diseases which behave similarly in some ways but maybe respond to treatment differently. So without a doubt, there will be patients with asthma who are particularly well suited for this kind of therapy and there will be others for whom this therapy may be unnecessary or may be less effective even than existing therapies.

RAY SUAREZ: Dr. Kaliner, a lot of attention is being paid to the fact that this is a non-steroid treatment. What are the shortcomings of steroids as a longitudinal or a permanent answer for asthma sufferers?

DR. MICHAEL KALINER: We would first recommend inhaled steroids as the first-line therapy for nearly all asthmatics, everybody who wheezes more than occasionally should be on an inhaler. And so let's not scare the 17 million people who have asthma. The inhaled steroid preparations we use today are by and large extremely safe and over the long haul within reasonable dose ranges are perfectly safe. And so there are potential problems from them because steroids have deleterious side effects at high dose that-- and we've only used them for 20 some years now by inhalation - but by and large these are extremely safe products or else I wouldn't be recommending them to all my patients as I do.

RAY SUAREZ: So they're not the best of a bad bunch. They're actually on the whole safe and certainly safer than not getting the best respiration possible.

DR. MICHAEL KALINER: Well, they are... I mean they're wonderful products. You have to take this into perspective. I've been treating asthma for 30 years now. And we can treat asthma so much better today than we've ever been able to do in the past. So we have wonderful tools to treat asthma. Now, this is a new way, with the anti-IGE is a new way to treat asthma. And it will find its way into the scheme of things but we already are so far ahead of what we were just five years ago.

RAY SUAREZ: In reading some of the results, Dr. Milgrom, I saw that your placebo group did quite a bit better, but you have some ideas as to why.

DR. HENRY MILGROM: Correct. Well, as Dr. Kaliner pointed out, inhaled steroids are very good, a very good treatment of asthma. And the patients who receive placebo were not receiving placebo alone; they were receiving placebo and the kind of therapy that is currently recommended for patients, and they were receiving it under close supervision and they were receiving encouragement to take their medication correctly. So, in point of fact, you know, it's a common finding that patients who enter studies improve regardless, whether they're on therapy or whether they're on control therapy, and so let me just make one point clear: There were three groups in this study. One group... each group received what we considered to be optimal care, and then one group received high-dose of the study drug. One group received low-dose of the study group and the third group received placebo in addition to the, you know, correct management for asthma. So from this point, the reason why everybody improved a little bit probably is that their therapy was perhaps more correct or more compulsively taken than it had been prior to the initiation of the study. What happens with asthma very frequently is that once patients get better, they can tolerate less therapy. So it takes more medicine to make patients well than it takes to maintain them in good control. So, once these patients were better, they were able to tolerate some reduction of drugs, and their symptom scores were improved by reason of that therapy. I don't think it's because the placebo made them better. It's because the underlying treatment made them better. So the important thing in the study is that, you know, the study patients continued to do well and continued to improve in spite of the fact that their corticosteroids were being reduced and they did it throughout the study. We only had eight weeks during which to reduce the corticosteroids. And we were reducing these corticosteroids until the final visit. What this basically means is that if the steroid reduction phase had been longer, the steroid dose could have probably been reduced further.

RAY SUAREZ: Are we any closer to understanding, Dr. Kaliner, why there has been this tremendous run-up in the number of cases and why so many people are dying from something that we have a good treatment for?

DR. MICHAEL KALINER: Well, there are two different questions. Let me answer them separately. There's a parallel increase in the incidence of allergy. And that probably accounts why there's such an increase in asthma. So they're both doubling over these past period of two decades. So, I think that accounts for the asthma. It is not pollution. That's a misunderstanding. Pollution in the United States is getting much better. So pollution levels are going down and asthma is going up. I don't think that pollution plays any role in the increasing problem with asthma. Cigarette smoking still does. The death rate is very different. The death rate is largely in underserved populations of the American population particularly inner city minority groups. Blacks and Hispanics are getting very bad medical care. That's why they're dying.

RAY SUAREZ: Dr. Milgrom, in that case, can anti-IGE drugs, as they're called be an answer for what is an medically underserved population when this is something that is administered by IV, not the easiest way to take your medicine?

DR. HENRY MILGROM: Well, the study results that we report were obtained in an IV protocol. But the drug can now be administered subcutaneously. And it only needs to be administered once every four weeks. So, you know, this is not the ideal way to serve people who are not well served, but it does offer an opportunity to offer injections to these people that could be administered once a month, and even if this is not sufficient treatment for their asthma, this may provide a safety net for them. But this is probably the way to improve the care of asthma for the indigent people -- is not going to be solved by medications because the medications that we have now probably are equal to the task. So it's going to be solved by improved care and by improved self-management by patients.

RAY SUAREZ: And Dr. Kaliner, aren't these drugs still pretty expensive?

DR. MICHAEL KALINER: I don't know the cost, but I anticipate it will be very expensive certainly in the initial phases of it. The issue is one not just of looking at the best medicine but the best livery of medicine. I think that's what Dr. Milgrom was implying. We have to figure out how we can provide good medical care to the underserved population and then asthma can be addressed as a part of that... the way that we present medicine to those people.

RAY SUAREZ: So Dr. Milgrom, what is the next study you have to do to take the next step?

DR. HENRY MILGROM: Well, I think as far as use of anti-IGE what we need to do is to seek out which groups of patients are most likely to benefit from it. We need to determine how long the drug needs to be used, whether it should be used in combination with other drugs, whether it should be used in combination with existing immunotherapy. There are a lot of questions that remain unanswered. I think what we know is that we have watched the development and not merely the development but also the application of a new drug, a very, very ingeniously conceived drug which will treat allergic disease other than asthma as well as asthma and will treat immunological disease in a way that is unique and in a way that the anti-body that is being given to these patients is effective regardless of the specificity of the patient's allergy. So whereas at the present time if somebody is giving immunotherapy to a patient, he has to know pretty well what the patient is allergic to. This may be a way to do it without having to know exactly what the patient is allergic to. And this is a difficult thing to define. But we certainly have a lot to learn about the best ways to apply this drug, and it's clear to me that the patients who require a great deal of medical care, who are frequently in the hospital, who are frequently in the emergency room, are either not responding to their corticosteroids or are not taking their corticosteroids. And for this group of patients who are actually very big users of the dollars assigned to medical care for asthma, this drug is bound to be cost effective.

RAY SUAREZ: Dr. Milgrom, Dr. Kaliner, thanks to you both.

FINALLY - ONE MAN'S ART

JIM LEHRER: Finally tonight, one man's art, for all to see. Paul Solman of WGBH-Boston has our story.

PAUL SOLMAN: To some art fans, the most comfortable museum in America: The private, personal Phillips collection in Washington, DC. More to the point perhaps, in this 19th- century mansion, America was introduced to modern art. Duncan Phillips turned his house into a home for pictures back in 1921. Nearly 80 years later, the museum is returning the favor, by honoring the eye of its stately, curious collector, an exhibit that maps Phillips' conversion to modernism and his role in introducing it to the rest of us, from impressionism's Monet to Mondrian, the geometric modernist; from the 19th century's satirist Daumier to De Stael, the 20th century abstractionist; or as the Phillips puts it, "from Renoir to Rothko." The museum now owns nearly 2,400 works of art, but only 362 of them are part of the exhibit, almost all hand-picked favorites of Duncan Phillips, who once explained his approach on radio in the 1950's.

DUNCAN PHILLIPS: I do not venture to anticipate posterity and the ultimate evaluations of history. The collector can only be true to himself. My choices have been, frankly, personal.

PAUL SOLMAN: Duncan Phillips was born in 1886, heir to the Jones and Laughlin steel fortune. When he and his brother, Jim, went to Yale, Duncan discovered art. After graduation, the brothers wrangled a $10,000-a-year art- buying allowance from their parents, several hundred thousand in today's money. After his father died suddenly in 1917, and his brother-- of the flu, a year later-- Duncan stepped up his collecting to stock a museum in memory of the loved ones. At first, there were few surprises: The 18th-century French Master Chardin; the 19th- century's Camille Corot and Alden Weir. The Phillips' director Jay Gates:

JAY GATES: In his youth his tastes are very conventional-- the weirs, and the Arthur B.Davies. The Inness landscapes, the sort of sepia-colored mid-19th century romanticism that doesn't show the love of color that he manifests just a few years later. And it's one of the remarkable things about him that he starts one place, ends someplace completely different.

PAUL SOLMAN: In 1913, when Phillips got his first glimpse of the "completely different," at New York's armory show, he was appalled. The show was "stupefying in its vulgarity," he wrote. Elsewhere, he dubbed one of its stars, Paul C zanne, "an unbalanced fanatic," and applied the same diagnosis to Vincent Van Gogh. As for Paul Gauguin, he was a "half-savage" returning to "savagery." The cubists were simply "ridiculous;" Henri Matisse, "poisonous." But the more Phillips looked, the more he saw. He would end up buying all of the above, revising his views and his earliest book, "the Enchantment of Art," first published in 1914. We asked Phillips' son Laughlin to read its revised opening from the 1920's.

LAUGHLIN PHILLIPS: "As I turn back to the essays of 'the enchantment of art,' written from 12 to 15 years ago, I'm embarrassed by some of the premature judgments of my youth, and envious of its genuine ecstasy." "I liked extravagantly a few painters and writers whom I now consider mediocre, and I did scant justice to other painters and writers who now seem to me great artists."

PAUL SOLMAN: In 1921, just as he was making the transition to modernism, Phillips opened his home to the public.

JAY GALE: When he opened the museum in 1921, there was not yet a museum of modern art. There was not yet a national gallery on the mall. The idea that you could go into someone's house on a regular basis and look at the work of living or recent artists was a relatively novel idea, and what he was buying in these years was nothing short of extraordinary.

PAUL SOLMAN: Two years later, he bought perhaps his most famous painting, Renoir's "Luncheon at the Boating Party."

LAUGHLIN PHILLIPS: My father felt he needed one really great painting to attract crowds. He was disappointed with the number of people coming in.

PAUL SOLMAN: Phillips wrote that it was "one of the greatest paintings in the world." "It creates a sensation wherever it goes." Indeed, the Renoir's superstar price tag made headlines: $125,000, several million in today's money, though it's said to be $80 million to $100 million. Phillips was still excited decades after he bought it, writing:

LAUGHLIN PHILLIPS: "Undoubtedly one of the great pictures of the world. Every inch of the canvas is alive and worth framing for itself, yet in spite of all the people, the landscape, the sparkling, sumptuous still life, there is not division of interest, and no crowding nor confusion."

PAUL SOLMAN: The more Phillips exposed himself to modern art, the more modern his taste became.

SPOKESMAN: In our century, the Phillips collection is especially strong in examples of Bonnard, the enchanter, the ever-young at heart; Matisse, the master of exotic arabesque; Braque, the 20th century Chardin.

PAUL SOLMAN: Braque, Jean Baptiste, Simeon Chardin, and many masters in between-- Phillips brought them all to the nation's capital. He also resolved, as much as possible, to "buy American" and bought our earliest, moderns: Marsden Hartley, "Off the Banks at night; Georgia O'Keeffe, "Red Hills, Lake George"; Milton Avery, "Black Sea"; Lee Gatch, "Industrial Night"; and Arthur Dove, "Electric Peach Orchard." The show's co-curator, Beth Turner:

BETH TURNER: I think what makes the peach orchard electric for Dove is the march of the trees into the distance, the wiry limbs crossing the sky as they... as they fill the picture plain and give us a rhythm and form that takes us right into the 20th century.

PAUL SOLMAN: Phillips provided some painters with a yearly stipend: Dove, Karl Knaths-- Phillips extolled "the witchery of his color"-- and the famous watercolorist John Marin, a sometime guest artist at the family home.

LAUGHLIN PHILLIPS: I remember one marvelous visit when he came to the Foxhall roadhouse, which has a terrace overlooking in the far distance. You can see the Potomac river, and in the middle ground are a lot of locust trees. He painted with both hands simultaneously, and in one hand was a big wash brush, you know, and in the other was a little pointed brush for doing the line, and they'd both be flying around at the same moment.

PAUL SOLMAN: Phillips didn't care if a work was impressionist, abstractionist, any kind of "ist" at all, only that it struck him as unique. He was among the first, for instance, to collect the Swiss fabulist, Paul Klee, writing that he'd built a "self-enclosed little universe with the whimsy and humor of childhood." Phillips was also an early fan of France's George Rouault, whose black outlines and spiritual themes reflect his early work in stained glass windows. We asked Laughlin Phillips to read his father's description of Rouault's "Afterglow, Galilee."

LAUGHLIN PHILLIPS: "There is a thrilling upward movement of symbolical, sacrificial reds. From the dark earth tones they mount in ever-increasing ecstasy to a glorious afterglow in the sky over Galilee. The lake is transfigured. We feel that the glow will never die."

PAUL SOLMAN: One of his favorites was this Pierre Bonnard. Laughlin Phillips identified with the boy in white in this one. But when Bonnard visited the family home where the painting hung, he told Mrs. Phillips, also an artist, that he wanted to repaint it.

LAUGHLIN PHILLIPS: When he saw this old painting of his, he wanted some paints. He said, "I've got to touch up this section up here." And my mother, who told this story years later, he knew she was a painter and might have paints, but she pretended they were totally unavailable in the country.

PAUL SOLMAN: Like Bonnard, Phillips was never finished. He bought "Portrait of Murray" by Joseph Solman, who happens to be my father, in the early 40's, gave my dad a one-man show in 1949, followed by a letter offering into buy three more works, one of which he'd swap for an earlier purchase. He ended with an art tip:

JOSEPH SOLMAN: "I hope you will from time to time go back to a style of your earlier pictures, and keep two styles going on together the way Karl Knaths varies his still lives with landscapes and near abstractions."

PAUL SOLMAN: Hanging next to you at the Phillips is a Karl Knaths near- abstraction. How did you respond when you got that last thought in the letter?

JOSEPH SOLMAN: I said, "what the hell is he talking about?"

PAUL SOLMAN: Were you offended that he would presume?

JOSEPH SOLMAN: No, no, I wasn't offended. I was so delighted he'd buy pictures of mine and give me a show, why should I be offended? How could you be offended when one of the great collectors of American art, or even some European art that he has, is taking you under his wing?

PAUL SOLMAN: Did you follow his advice?

JOSEPH SOLMAN: No, I respected it. Like all good artists, they paint what they want.

PAUL SOLMAN: If Phillips was close to his artists, he was an arms-length dad.

LAUGHLIN PHILLIPS: From a kid's point of view, he was pretty distant. He had hishuge interests-- namely art. He didn't have a whole lot of small talk, especially for kids.

PAUL SOLMAN: And yet this solemn, aristocratic man wound up in a vibrant, ongoing dialogue with modern art, collecting Nicholas De Stael, Jackson Pollock, and finally, Mark Rothko, to whom he gave a room of his own, writing:

LAUGHLIN PHILLIPS: "It is the color, of course. These canvases, which have been called empty by the resistant skeptics, are a vibrant, life- enhancing experience to those who make themselves ready. They cast a spell."

PAUL SOLMAN: To cast a spell: That, finally, was the goal of Duncan Phillips, and his museum achieved it-- at least for artist Richard Diebenkorn, stationed at a marine base near Washington in the 1940's and a frequent visitor, as he recounted years ago.

RICHARD DIEBENKORN: One could sit. And I can't believe this, but one could smoke. There were ashtrays. And one could look, and there was plenty to look at.

PAUL SOLMAN: Diebenkorn looked, especially at this Henri Matisse, the artist Phillips had initially found "poisonous."

RICHARD DIEBENKORN: There is a figure on a couch, and a view across the Seine. The painting has stuck in my head ever since I first laid eyes on it there. I have discovered pieces of that painting coming out in my own over the years.

PAUL SOLMAN: Paintings of Richard Diebenkorn that Duncan Phillips would himself collect to inspire, perhaps, generations to come. "The Eye of Duncan Phillips" closes January 23, the year 2000.

RECAP

JIM LEHRER: Again, the major stories of this Thursday: Federal prosecutors in Vermont said a woman arrested at the Canadian border has terrorist ties. U.S. postal inspectors checked mail from Frankfurt, Germany, for bombs because of an F.B.I. Warning. And international aid for flood and mud slide survivors poured into Venezuela. We'll see you online, and again here tomorrow evening with political analysis by Mark Shields and David Brooks, among other things. I'm Jim Lehrer. Thank you and good night.