The MacNeil/Lehrer NewsHour

MR. MacNeil: Good evening. I'm Robert MacNeil in New York.

MR. LEHRER: And I'm Jim Lehrer in Washington. After our summary of the news this Veterans Day, we sort through the walking around money story in New Jersey, Charles Krause reports on NAFTA from an American factory in Mexico, we have an update on the suffering in the Bosnian capital of Sarajevo, and we close with extended excerpts from Veterans Day ceremonies in Washington. NEWS SUMMARY

MR. LEHRER: President Clinton spent this Veterans Day honoring Americans who served in the military. He signed a bill increasing the cost of living allowance for 2.5 million disabled veterans. He said his administration had kept its promise to release virtually all once classified documents on Vietnam POW's and MIA's, and he went to Arlington National Cemetery. There, the President placed a wreath at the tomb of the unknowns. In a speech later at the cemetery's amphitheater, he said, "A grateful nation remembers."

PRESIDENT CLINTON: Today we gather to honor those who have rendered the highest service any American can offer to this nation. Every American who ever put on this nation's uniform and wore these has assumed risks and made sacrifices on our common behalf. Each of the 1.6 million men and women now in our forces today bears our common burden. This day belongs to all of them, to all who have protected our land we love over all the decades and now over two centuries of our existence, from the minutemen who won our independence to the warriors who turned back aggression in Operation Desert Storm. It belongs to those who fell in battle and those who stood ready to do so, to those who wounded and those who treated their wounds, to those who returned from the service to friends and families, and to the far too many who remain missing.

MR. LEHRER: We'll have more on Veterans Day later in the program. Robin.

MR. MacNeil: Two freight trains collided and burst into flames early this morning in Washington State. At least one crew member was killed. Rescuers were searching for four others missing somewhere in the burned wreckage. About 20 of the cars derailed, and some ended up on Interstate Highway 5. Neither train was carrying hazardous materials. The head-on collision happened in foggy conditions, but it was unclear why both trains were on the same track. At least 15 people were burned to death and 47 injured in a huge highway pile-up in southwest France. It happened last night on the main Paris to Bordeaux route when two trucks collided and were then struck by more than fifty other cars and trucks. Most caught fire. Police said weather conditions were poor, and many of the drivers were speeding.

MR. LEHRER: The United Nations tightened sanctions against Libya today for its refusal to hand over suspects in the Pan Am Flight 103 bombing. The Security Council resolution imposed a partial trade embargo and froze Libyan funds abroad. It did not ban oil sales by Libya. The 1988 bombing of the Pan Am airliner over Lockerbie, Scotland, killed 270 people. Two Libyans were indicted in the attack. The new resolution gives Libya until December 1st to comply.

MR. MacNeil: An evacuation of Serb civilians from Sarajevo resumed today. It did so after Serb militia released two Croats kidnapped from a U.N. vehicle earlier this week. An evacuation of about 700 Serbs began Monday but was quickly halted by the kidnapping incident. It was the first major evacuation from the Bosnian capital in months. We'll have more on conditions in Sarajevo later in the program.

MR. LEHRER: And that's it for the News Summary tonight. Now it's on to walking around money in New Jersey, NAFTA, and one plant in Mexico, a Sarajevo report, and the women who served in Vietnam. FOCUS - COMINGS & GOINGS

MR. LEHRER: First tonight, another perspective on NAFTA. The final vote on the trade treaty with Canada and Mexico is scheduled for next Wednesday in the House. We look at some of the issues involved in the NAFTA argument from the view of an American company already operating in Mexico. Charles Krause reports.

MR. KRAUSE: At first glance, San Luis Potosi, Mexico, might seem like the wrong place to gauge the impact of NAFTA on jobs in the United States. Colonial spires dominate the horizon, and at the center of town there's several mission-style churches dating from the Spanish conquest nearly 500 years ago. Not much changed in San Luis until about 20 years ago. Then during the '70s because of its rail lines and central location, the city grew into an important industrial center. Today it's home to the Mexican subsidiaries of more than half a dozen major U.S. corporations. These American- owned plants already employ three to four thousand Mexican workers, and if NAFTA is approved, that number is likely to grow. Almost all the American companies in Mexico support NAFTA. But until recently, no more than a handful of their executives were willing to explain why. One the ones who has is Steve Knaebel, president of the Cummins Engine Company. Headquartered in Columbus, Indiana, Cummins has its principal Mexican plant in San Luis. Knaebel is informal and clearly at east with his Mexican employees. He's also outspoken, and his message these days is loud and clear. NAFTA, he says, will benefit U.S. companies and will not result in a greatsucking sound of American jobs lost to Mexico.

STEVE KNAEBEL, President, Cummins Engine Co., Mexico: We strongly believe that the NAFTA will create jobs in the United States as trade barriers and other restrictions in Mexico are eliminated. We believe that it will result in greater investment in Mexico. That will cause economic growth. There will be greater opportunities for both our company to sell more products and for our customers to sell more.

MR. KRAUSE: So when you say this is a win-win situation, that's what you're talking about?

STEVE KNAEBEL: Exactly.

MR. KRAUSE: Cummins Engine came to Mexico 30 years ago investing more than 50 million dollars in San Luis. It would have been cheaper and more profitable to export engines from Indiana, rather than build a factory here in Mexico, but that wasn't possible. The Mexican government required foreign companies like Cummins wanting to do business in Mexico to manufacture their products in Mexico. It wasn't until the mid 1980s that that began to change. Faced with a serious debt crisis, Mexico finally to encourage foreign investment by opening up its highly protected domestic economy. Beginning in 1986, Mexico joined GATT and began lowering tariffs and other trade barriers which kept out imports from the U.S. Then in 1989, Mexico's current president, Carlos Salinas, signed the auto decree, which among other things for the first time allowed foreign companies to import already assembled trucks, buses, and diesel engines into Mexico. As a result, Cummins began to cut back engine production here in San Luis and began to import more engines from its factories in Indiana, New York, and North Carolina. The figures speak for themselves. Since 1991, Cummins has nearly tripled the number of engines it imports into Mexico from the U.S. Meanwhile, it's cut by nearly 2/3 the number of engines it produces in San Luis. Cummins pays its Mexican workers only $4.50 to $6.50 an hour with benefits, just 1/6 as much as their American counterparts. Yet, Knaebel says that in most cases it's still more profitable for Cummins to manufacture engines and parts in the U.S. As a result, today Cummins assembles only one engine in San Luis, the M-14. A tour of the factory floor helps explain the shifts and changes that have already occurred.

STEVE KNAEBEL: That open space over there, for example, is for our mid range 8.3 liter C engine. We no longer make it here. We discontinued manufacturing it because it's more cost effective to source it out of the United States, out of Rocky Mountain, North Carolina.

MR. KRAUSE: So in other words, this, this C-engine that you used to make here, you've moved that production back to the states?

STEVE KNAEBEL: That's right.

MR. KRAUSE: From what I understand, about 80 percent of the parts that go into this M-14 engine are actually made in the United States and then shipped here.

STEVE KNAEBEL: That's correct.

MR. KRAUSE: How many jobs would you think those parts represent?

STEVE KNAEBEL: We calculate between a hundred and fifty and two hundred jobs that are supported by this plant.

MR. KRAUSE: Altogether?

STEVE KNAEBEL: Yes.

MR. KRAUSE: I think it will surprise a lot of people that, in fact, you've moved a fair amount of production out of Mexico and back to the states. Why is that? Everyone in the United States seems to think that it's cheaper -- the cheaper labor costs in Mexico make it cheaper to build almost anything here in Mexico?

STEVE KNAEBEL: As a matter of fact, labor cost is only a small percentage of the cost of sales, and there are a number of difficulties we face in Mexico where the United States has a tremendous competitive advantage. I'm talking about telecommunications, infrastructure like highways and ports, the cost of energy. The cost of capital here, for example, is three to four times what it is in the United States. I think people who talk about labor being the only factor don't really have much of an understanding of a complex manufacturing operation like this one. You don't just pick up a plant and move it anywhere, much less to a foreign country, and to do so, is hugely expensive.

MR. KRAUSE: But with free trade and increasing globalization, it does sometimes happen. Cummins has not only shifted some production from San Luis to the United States, it also recently brought in a complete production line for making cylinder heads to Mexico from, of all places, Japan.

MR. KRAUSE: This line came from Japan, correct?

STEVE KNAEBEL: That's right.

MR. KRAUSE: And tell me why.

STEVE KNAEBEL: Well, the distance, the transportation distance to get the machine heads to Indiana added a lot of cost, and we have a local foundry source in Saltio, in the north of Mexico, so we were able to reduce cost by bringing it here.

MR. KRAUSE: So this is a case where Mexico is beating out Japan, in effect?

STEVE KNAEBEL: Absolutely. We're shipping 240 heads a day to Indiana and also to England. And, incidentally, these heads were never made in the United States. They're just being made closer now, and that reduces cost because of the land transportation and the shorter distance.

MR. KRAUSE: But there's one section of the Cummins plant that also demonstrates what NAFTA's opponents have been saying, that cheaper wages in Mexico will mean shifts of production and jobs from the United States. Cummins used to make these crank shafts at a plant Pistoria, Ohio, but after unions there refused to accept more flexible work rules, the production was shifted to San Luis and to Brazil.

MR. KRAUSE: How many employees work making these crank shafts?

STEVE KNAEBEL: Right now, there are about 70 employees.

MR. KRAUSE: The unions that refused to change the work rules in Ohio, how many jobs did they lose as a result of that?

STEVE KNAEBEL: Well, I think you'd have to say it would be an equivalent number.

MR. KRAUSE: Seventy or so?

STEVE KNAEBEL: Yeah.

MR. KRAUSE: So, in effect, are you saying that if the unions had been willing to be more flexible that these jobs could have remained in the United States?

STEVE KNAEBEL: I believe so.

MR. KRAUSE: So it is not solely the cheaper labor cost down here as much as it is the flexibility of unions and workers in the U.S.

STEVE KNAEBEL: I think that is an issue. I think that American unions are resisting the, the reality of globalization. They've been hit hard. They've lost a lot of membership. People have lost jobs. It's very painful, and I think they need to break out of that and understand that jobs are going to move around the world as countries around the world increase their competitiveness and, and try to gain productivity.

MR. KRAUSE: Those are fighting words for NAFTA's opponents. Harley Shaiken, an expert on wages and labor conditions in Mexico, is professor labor economics at the University of California, Berkeley. He says the fact that Cummins has moved some jobs out of Mexico to the U.S. is less indicative of the future if NAFTA passes. Then its decision to move crank shaft production and jobs from Ohio to San Luis.

HARLEY SHAIKEN, Labor Economist: I think what we are looking at is the danger of global whipsawing where workers have no choice but to accept a dollar an hour in Mexico, and where that's used to lever, as a lever for workers to lower their wages in the U.S. But it isn't just wages. It's also working conditions. In contract negotiations in the U.S. I think the major threat that a company may have is moving a plant or an operation or simply threatening to move something to Mexico. To move a $15 million, capital intensive, hi-tech line like crank shafts to Mexico in order to teach workers in the U.S. a lesson I think sends a very chilling effect -- chilling message to many workers.

MR. KRAUSE: But Shaiken says his biggest problem with NAFTA is that labor unions in Mexico are controlled by the government.

HARLEY SHAIKEN: The lack of labor rights in Mexico and Mexican government policies keep wages low as productivity rises. Under those circumstances, U.S. workers aren't competing with Mexican workers; they are competing with a very repressive system which will have a disproportionate influence on wage setting in the U.S.

MR. KRAUSE: The wages and living conditions of workers in Mexico have become major issues during the last days of the NAFTA debate in the United States. So at Cummins we asked several workers if they would show us where they live. One of them was Miguel Arosco, an assembly line worker who takes home on average about $100 a week. Still, Miguel and his wife, Lucy, who earns $50 a week as a secretary, own their own car. It's 10 years old but it's a car nonetheless. The Aroscos' two sons, Erone three and Abraham ten, appear to be healthy, well-clothed, and well-fed. Miguel and Lucy own their own home. They bought it seven years ago. It's small but modern with a bathroom, kitchen, and two bedrooms. In addition to the home, they own two TVs, a VCR, and imported stereo equipment. They've also got a cupboard full of prepared food made by companies familiar to most Americans. Miguel and Lucy told us they live well and wouldn't cross the border right now even if they could. Lucy did say though that one days she hopes to take Erone and Abraham to Disneyland in the United States. While the Aroscos don't prove that all Mexican workers live well, they do offer some proof that not all Mexican workers live in cardboard shacks, exploited by corrupt Mexican labor unions and American corporations. Indeed, most of the Mexican workers at Cummins told us they think free trade will make their lives better, but they also think competition from the U.S. might put some Mexican companies out of business. Even Steve Knaebel says that in some ways it's a gamble.

MR. KRAUSE: Do you ever -- do you have any doubts at all about NAFTA?

STEVE KNAEBEL: It's a very complex arrangement, involving every facet of the economies of three countries. If you didn't have doubts, I think you'd be foolish. I think that at the end of the day, it's going to be a boon to the United States, and in the short-term, it's going to be difficult for Mexico as Mexican consumers turn to high quality, low cost American products. I think longer-term it's a win-win situation because both countries will benefit from increased employment and better, more environmentally sensitive products for their, their citizens.

MR. KRAUSE: Clearly, NAFTA encompasses many complex issues, but the one likely to prove most decisive when Congress votes next week is jobs, both here in Mexico and north of the border in the United States. FOCUS - BLEAK PROGNOSIS

MR. LEHRER: Next tonight, we return to the brutal cost of war in Bosnia. This week at least 17 people were killed and 100 wounded in a new and seemingly indiscriminate surge of shelling of the capital, Sarajevo. Most of the victims were children after mortar rounds slammed into their classroom. Today two of those children whose legs were shattered in the attack were flown to Italy for medical care. But for many other victims of the war the prognosis is far less certain. Gaby Rado of Independent Television News has this report.

GABY RADO, ITN: Each day, this patient has to have bandages replaced on horrendous injuries to his legs. [patient groaning in agony] He sustained them when he stepped on a land mine three weeks ago. It's normal hospital procedure but here in Sarajevo they have to change the dressings on his open wounds with no anesthetic. The trainee surgeon on duty has just come on shift after six days in uniform out on the front line.

DR. DARIO IVANISOVIC, Trainee Surgeon: We haven't enough supplies because in this situation this dressing was very painful, you know, and in a normal situation we have to, to give some kind of anesthesia to this patient, but because we haven't enough anesthetics we cannot work with that. It's a problem, you know. It's a very large problem. This is like the middle age, you know.

MR. RADO: The traumatology department of the Kosovo Hospital contains a physiotherapy room, essential to patients whose injuries led to months of enforced inactivity. This soldier's recovering from his fourth bullet wound, the old scar just a few inches below the new injury. Some 40 percent of the people here are soldiers from the mainly Muslim Bosnian army but the rest are civilians. In Sarajevo, no one is immune to bullets or fragmented shells. Such patients ought to have three-hour long physiotherapy sessions a day. Here, because of overcrowding and staff shortages, they only get one hour, and their equipment is inadequate. Of the 80 patients in the trauma unit, 26 are paraplegic, paralyzed from the waste down by spinal injuries caused by shrapnel or bullets. For people like these, rehabilitation is a long and costly process. But it can lead to dramatic improvements, including restoration of some mobility. This paralyzed soldier who was a vet before the war knows his chances would be better abroad.

DARKO ODAK: [speaking through interpreter] If I went abroad, I would probably have better results. For instance what I achieve here in three months, I could do abroad in one month.

MR. RADO: While the surgeons are proud of the work the hospital has carried out during the war, they want paraplegic patients given the benefit of treatment in better-equipped countries. The prognosis for 10-year-old Muamer Sultic is uncertain. No one knows if he'll walk again, though his doctors say that because he's still growing, there was a chance of the right kind of rehabilitation not available in Sarajevo may one day lead to him walking unaided. Muamer was injured by a mortar at his home in Kanyitz, south of Sarajevo last spring. He was first taken to a local hospital.

MUAMER SULTIC: [speaking through interpreter] I got up to try to walk, but I couldn't -- my legs were shaking. I had to use tubes to go to the toilet. I couldn't walk so they put me back on the bed. I got bed sores on my back and further down my body. After that, they brought me here, and now I am a patient here. Perhaps I'll go to Denmark. One UNPROFOR soldiers from Denmark who brought me from Tarcin to Sarajevo will try to take me. I'm walking for him to come.

MR. RADO: What the people in this hospital are asking of the outside world is not just that more medicine or equipment be flown in. There are finite limits to that set by the war. What they're saying is that every plane that flies out after unloading should carry with it victims of the conflict. Peace is only a half hour flight away from Sarajevo but there's a feeling in the Kosovo Hospital that the International Community either doesn't understand the besieged city's medical problems, or else it has deliberately ignored them. But at the Sarajevo office of the U.N. High Commission for Refugees we found there was no shortage of offers of beds from western hospitals. Rather, the U.N. and the International Red Cross has jointly decided not to put paraplegics and amputees on their list of evacuation cases, preferring to keep beds waiting for patients from elsewhere in Bosnia.

TONY LAND, Head of UNHCR Office, Sarajevo: Yes, certainly it would be possible to place some of these cases I believe. The question is: How many of our offered beds should we keep for these sort of people from Sarajevo? We have a war that is still raging in central Bosnia, and there are still victims being created.

MR. RADO: At the bottom of the hill where Kosovo Hospital stands, they've dug up a football field, and they're prepared a number of graves in the certainty that coffins will soon follow. It's a dark fatalism in the hearts of Sarajevo's people which may only be lifted if the West shows it's prepared to do more for victims whose lives can be improved. FOCUS - NEW JERSEY - DIRTY TRICKS?

MR. MacNeil: Dirty politics New Jersey style, is it business as usual, or politics gone too far? Our next story tonight is the furor caused by the claim this week that the Gubernatorial campaign of Republican Christine Whitman in New Jersey paid money to keep Democratic voters away from the polls. On Tuesday, Christine Todd Whitman's campaign manager hinted that their narrow victory over Gov. Jim Florio may not have been fair and square. At a meeting with reporters, Edward J. Rollins claimed to have bought off black ministers whose congregations typically vote Democratic to stifle any "get out the vote" sermonizing from their pulpits. Rollins said he'd used $1/2 million of so-called "walking around money" from the Republican State Committee historically used to boost Republican voter turnout to make donations to the ministers' favorite charities.

EDWARD ROLLINS: We went into black churches, and we basically said to ministers who had endorsed Florio, "Do you have a special project?" And they said, "We've already endorsed Florio." We said, "That's fine. But don't get up in the Sunday pulpit and preach it. You know, we know you've endorsed him, but you know, don't get up there and say it's your moral obligation that you go on Tuesday to vote for Jim Florio."

MR. MacNeil: Rollins also claimed to have paid off Democratic campaign workers to keep them from getting their party's voters to the polls.

EDWARD ROLLINS: We played the game the way the game is played in New Jersey, or elsewhere.

CHRISTINE TODD WHITMAN, [R] Governor-Elect, New Jersey: It's immoral, and I do not play the game that way.

MR. MacNeil: Yesterday, at a hastily-called news conference, an angry Christine Todd Whitman stood before an outraged group of black ministers to deny Rollins' claims.

CHRISTINE TODD WHITMAN: I find this whole thing, everything that was alleged in the comments that he made degrading, degrading to the voters of New Jersey, degrading to the African-American community, the African-American churches, and frankly to me. This is not the kind of behavior or attitude that I would in anyway or in any time condone, and nothing like this ever happened.

MR. MacNeil: Whitman demanded and received an apology from Rollins. She read his contract letter to reporters.

CHRISTINE TODD WHITMAN: "This is the first time that my desire to put a spin on events has crossed the line from an honest discussion of my views through exaggeration that turned out to be inaccurate. I went too far. My remarks left the impression of something that was not true and did not occur."

MR. MacNeil: But state Democratic officials said they'd sue to see Republican records.

RAY LESNIAK, New Jersey Democratic Chairman: We take depositions of top Whitman campaign aides to see how pervasive this practice was.

GOV. JIM FLORIO, [D] New Jersey: The facts in this matter must be uncovered, and I trust that they will.

MR. MacNeil: For Gov. Florio, the latest flap must seem like deja vu. In 1981, he lost the governors race by a mere 1800 votes amid charges that Republicans had intimidated the black voters by stationing armed security guards at polls. This time his margin of loss was 40,000 votes out of almost 2 1/2 million cast. African- Americans, who make up 8 percent of the state electorate, were solidly in his camp by a three to one margin. But that was below the 84 percent of the black vote he got in 1989. His campaign has asked for a Justice Department investigation into whether federal voting rights laws were broken in this election. Yesterday afternoon President Clinton had this reaction.

PRESIDENT CLINTON: First, I think we should all acknowledge that people have died in this country, given their lives, to give other Americans, especially African-Americans, a right to vote. And this allegation, if it is true, and I say if it is true -- I don't know what the facts are -- but if it is true, then it was terribly wrong for anyone to give money to anybody else not to vote or to suppress voter turnout. And it was terribly wrong for anyone to accept that money to render that non-service to this country.

MR. MacNeil: Today the minister of a Baptist church in Camden, New Jersey, the Rev. Keith Owens, said several members of the Black Ministers Council of New Jersey were approached by state Republicans. He said they offered to make cash donations to charities if the clergymen would not encourage black voters to go to the polls. Rev. Owens did not say if the money was accepted. We now get five perspectives on this story. Paul Begala is a Democratic political consultant. He and his partner, James Carvil, were strategists for the re-election campaign of Democratic Gov. James Florio. Peter Sheridan is the executive director of the New Jersey Republican State Committee. We're expecting him shortly. The Rev. S. Howard Woodson of the Shiloh Baptist Church in Trenton is the president of the Black Ministers Council of New Jersey. He's also been active in politics, serving in former Republican Governor Tom Kean's administration and currently acting as Gov. Florio's equal opportunity director. He joins us from Trenton. And with him is Ed Baumeister, the managing editor of the Trenton Times, and Bennett Roth is a reporter with the Houston Chronicle. He was at that breakfast meeting with Ed Rollins earlier this week. Rev. Woodson, what do you make of the statement today by Keith Owens in Camden, New Jersey, the Rev. Owens.

REV. S. HOWARD WOODSON, Black Ministers Council of New Jersey: I just heard that statement this evening. Up until that time I had not known of any minister who had been approached, but I am still incensed. I am insulted, and all of us are that the party would even dare approach the clergy and offer money in order to keep people from voting.

MR. MacNeil: Is Mr. Owens a reliable man. If he says ministers were approached, would you take it as certain that they were?

REV. WOODSON: If Keith said it, I believe it. Keith is co- chairman of our Political Action Committee, and I don't believe that he has any interest in saying what is not true. My concern is not what Keith had to say but rather what Mr. Rollins had to say, and although he has retracted, the fear fact that he said it in the beginning leads me to believe that there must have been some truth in the allegation made. How else would he come to a conclusion or make a statement of that kind had there not been that effort and had there not been those who perhaps did accept some of the money?

MR. MacNeil: Let's go to the reporter who was there when Mr. Rollins said that. Bennett Roth, you were present. Did you listening to him -- we just heard the tape -- the audio tape -- did you doubt what he said, the truth of what he said?

BENNETT ROTH, Houston Chronicle: No, he was very believable I thought. He volunteered the information. He was very specific. He talked about the, the ministers and the city workers, and he didn't appear to fudge or do the sort of things people do when you feel they're evading you or dodging you.

MR. MacNeil: Did he seem, did Mr. Rollins seem aware in talking to you reporters that he was disclosing, what he was disclosing would be seen in a very negative way?

MR. ROTH: Only at one point when there were some follow-up questions asking about what church or how much, and then he goes, well, that's not really the story here. It was a wide ranging discussion. At that point I think he seemed to grasp that maybe this might be the headlines.

MR. MacNeil: What did you make of his later denial?

MR. ROTH: Oh, I felt that there had been probably a lot of pressure put on him by New Jersey Republicans.

MR. MacNeil: We're now joined by Peter Sheridan of the Republican State Committee in New Jersey. I don't -- because you just got here, I don't know whether you heard the report that a minister of a Baptist church in Camden, New Jersey, the Rev. Keith Owens, said today that several members of the Black Ministers Council of New Jersey were approached by state Republicans. Did you hear this report?

PETE SHERIDAN, Executive Director, New Jersey GOP: I just heard on the way in but I also heard he wouldn't identify the persons that were involved. He didn't know the amount of money. It wasn't him personally. So the only thing I can say is that such unsubstantiated facts cannot be given any credence the best as I know, and I've been very close to this situation. I've dealt with all the election day compliance activities of the last few months. No such thing occurred.

MR. MacNeil: Well, we just had Rev. Woodson, who's with us from the Black Ministers Council in New Jersey. He's with us in, in Trenton, and he said he knows Keith Owens, and if Keith Owens said it, it's true. Just tell Mr. Davidson -- Sheridan what you just told me, Rev. Woodson.

REV. WOODSON: I have every confidence in Keith Owens and his veracity in saying that he has received information that some of the members were approached, but as I indicated to you before, that is not my concern. My real concern is Mr. Rollins' statement in the first place. Why even say it if there were not some kernel of truth in it? Why -- how can you imagine something happening of that kind unless in truth black ministers were approached, and if they were not approached, then Mr. Rollins has to go forth much further than he has gone to simply retract some of it.

MR. MacNeil: Mr. Sheridan, does this Owens statement give you any doubt about the position that you and the party and Ms. Whitman have taken, Governor-elect Whitman have taken up to now this didn't happen? Do you begin to have any doubts whether it might have happened?

MR. SHERIDAN: Not at all. I can account -- and we have said continuously that over the next several days that we will make a full accounting of all the income and all the expenditures of the Republican State Committee with regard to all our activities since June, and I can tell you right now I'm very confident that all those moneys will be accounted for. There was never any such program as Mr. Rollins said. I cannot explain to you why he made such false and malicious and untrue statements, but he did that. He has retracted them. And all I can tell you is that there is no grain of truth in what Mr. Rollins said the other day.

MR. MacNeil: The use of "walking around money," as it's called in New Jersey politics, is customary and traditional, isn't it, and it's used to get people out to the polls?

MR. SHERIDAN: Yeah, that's correct. In fact, in New Jersey's statute dealing with election law they call it "street money." And there's a definition for "street money" in the statute. And it's used for two things: [a] to get out the vote, and [b] to pay challengers who watch the polls and to make sure that people who are voting are registered and eligible to vote. And that's been done for years and years, decades, in fact.

MR. MacNeil: How much money, street money did the Whitman campaign spend in this election?

MR. SHERIDAN: The Whitman campaign, from my knowledge, didn't spend any. The Republican State Committee who -- which I'm the executive director of -- had an election day program, and we spent approximately $50,000 on those activities on that day.

MR. MacNeil: And that is all?

MR. SHERIDAN: That's it.

MR. MacNeil: And you're absolutely certain that none of that money went for purposes that Mr. Rollins has described?

MR. SHERIDAN: Mr. Rollins, I just can't explain it. It's an outrageous statement that he made, and I agree with Rev. Woodson to the degree that he owes an apology to the black community. They were malicious statements that are unfounded.

MR. MacNeil: Paul Begala from the losing side of this election, what do you make of the, of this latest disclosure by Mr. Owens, Rev. Owens? PAUL BEGALA, Democratic Campaign Consultant: It's just the latest in a series of facts that are gradually coming to light. What it means is we need an investigation. What it means is we need to get people like Mr. Rollins, like Mrs. Whitney, like her brother, Dan Todd, who was Mr. Rollins's predecessor as campaign manager up until the closing weeks of the campaign, we need to get them before the proper authorities, swear them under oath, and find out the truth. We owe that to Rev. Woodson, whose reputation and other clergy has been smeared. We owe that to Gov. Florio. We owe that even to Mrs. Whitman, whose, whose -- the legitimacy of whose election is called into real question here.

MR. MacNeil: The turn-out for Florio was lower in many of these black precincts than in the previous election. Are -- are you prepared to say that that's -- that this -- that that is where he lost the election?

MR. BEGALA: Well, I am prepared to say that he performed much worser than we ever anticipated. Don't forget, Jim Florio who is a governor who put his entire political career on the line, raising taxes on upper income people in order to help school funding in disadvantaged areas, primarily African-American areas, but also many middle class areas. Given that record, that extraordinary record of political courage, and that long-term commitment to the African-American community, we were stunned and devastated to have done so poorly. Now, I am not ready to point any fingers of blame, except at myself and other people who failed Gov. Florio as employees, okay, but I think everything is owed an investigation to find out if this is true. There are too many facts that, that are coming to light, and they go back. The New Jersey Republicans, you know, have a long and sordid history of trying to suppress black vote. In 1981, they had a measure that they euphemistically called Alex security where they used threats and intimidation to try to keep African-Americans away from the polls. And now we have the next generation of that alleged by Mr. Rollins, himself, who was Mrs. Whitman's campaign manager.

MR. MacNeil: A long and sordid history, Mr. Sheridan?

MR. SHERIDAN: Well, I wouldn't agree with that at all. First off, our, our position with regard to the facts that are here today is that there will be a full disclosure of all the moneys that have been spent by the Republican State Committee throughout the campaign, and we'll be before Judge Day BeVoix I guess on Monday, and obviously we'll comply and do whatever the court thinks is the best thing under this, under this situation. I'm not saying that there's an investigation that's necessary, but if there's an orderly procedure that the courts establish and there's a full disclosure of the records, I think that's the appropriate course at this time. A sordid history of the Republican Party? I don't agree with that. Both parties have utilized street money and have utilized, have had election day activities. They go back way before the turn of the century. Our programs have been no different than those of the Democrats, and I -- I don't think that's a correct statement.

MR. MacNeil: Ed Baumeister, as the editor of the paper in Trenton and as an observer in New Jersey politics, what do you believe in this matter?

MR. BAUMEISTER: Well, it's ironic that what caught people up here was a very old money practice. Street money has been around not only in New Jersey but in Massachusetts, where I grew up. When I was a kid I'd get three or four bucks for working on election day. I've seen it. It's New York. I think all the old eastern states. But what this is really about is new money and the way our campaigns are run now. This was Ed Rollins, who represents the new money way our campaigns are run, and old money meeting and tripping up. We had a dreadful campaign in New Jersey run by -- no disrespect to Mr. Begala -- technically it was great, both campaigns had things to be admired, but on the issues there was no campaign on the issues. Each candidate hired someone from out of state who has no particular long-term stake in the place, and they ran basically attack campaigns. And the pressure to win -- these are professional people whose job is to win, to win elections, and it's not surprising at all that in this high pressure, multimillion dollar operation, there would be some perversion of what had been perhaps not administered by angels before but a sort of a longstanding practice that wasn't very, wasn't very -- might have been somewhat corrupt but wasn't very corrupt.

MR. MacNeil: What do you believe in the, in -- do you believe Rollins' original statement? Doyou believe the retraction? What do you believe from where you sit?

MR. BAUMEISTER: Well, the retraction was extremely artful, and it's not really a full retraction. It's a very tortured piece of prose. I expect it's meant to have space between the line. I tend to believe what he said the first time was true. I tend to not believe the amount of money because that amount of money floating around would have attracted some attention. But I think it was that he meant that that kind of operation, I agree with the Reverend, Mr. Woodson, and that's certainly something to be investigated.

MR. MacNeil: Do you want to respond to that?

MR. SHERIDAN: It's absolutely untrue. There was no program of any nature, as Ed Rollins had stated.

MR. MacNeil: Could it be possible -- with great respect to you and your -- that it actually happened and you don't know about it?

MR. SHERIDAN: Well, I would think that's highly, highly unlikely. I mean, we kept close tabs and close management of our entire campaign, and there is no freelancing in the Republican Party that I would have any -- that I was aware of. I don't think it happened in this case. I know I used to see Mr. Rollins almost on a daily basis. There were no activities like that coming out of the People for Whitman Campaign. So I just -- there's just no basis in fact. This thing just did not happen.

MR. MacNeil: Rev. Woodward --

REV. WOODSON: Woodson.

MR. MacNeil: -- Woodson -- I beg your pardon -- if the amount of money Mr. Rollins was talking about or some lesser but substantial amount really was circulating and these offers were being made, to pick up on Ed Baumeister's point, is it unlikely nobody would have heard about it before now?

REV. WOODSON: Yes, because if that kind of money got out, I'm certain that those who may have taken it would certainly not be willing to broadcast the fact that they have taken it. But let me just add one other item, and that is that Mr. Rollins' statement impugned not only black ministers but the black church that it could be bought, that black people will stay away from the polls if there is enough money to keep them from the polls. I think that it demands a full investigation because you've not only insulted a large group of ministers, you've insulted the church, itself. And unless it's cleared up, no matter what the executive director has to say, you have impugned the black church, and you have made ineffective the black minister.

MR. MacNeil: Let's go back to Washington and Bennett Roth. You're covering this story from Washington. What moves are there - - because there have been calls for a federal investigation, I believe -- what moves are there, and is there going to be a federal investigation?

MR. ROTH: Well, I believe the Justice Department is going to look into it, and they said they're going to see if there are any laws that can be applied to this. I'm not sure there is, or whether we'll be able to move further on that, but that's where it stands there and what the courts will say in New Jersey. And there's a - - there's political ramifications here as well. The President addressed it and what not. And the Republican Party was on a roll here, and this may provide a few kinks in that.

MR. MacNeil: Paul Begala, is this a legal matter, or just a question of election morality, the other side of the coin of paying people to help go to the polls?

MR. BEGALA: It's both, Robin. First off, the difference between hiring employees to increase turnout and spreading around money to decrease turnout is the difference between right and wrong. It's not just the way the game is played. But what --

MR. MacNeil: But is it illegal?

MR. BEGALA: -- your viewers may not know -- it deserves a full investigation -- but what your viewers may not know is that the New Jersey Republican Party is bound by a consent decree because in 1981, they used tactics and intimidation to try to suppress black votes. In 1982, the federal district court put them under a court order, consent decree, whereby they could no longer engage in any tactics to suppress black turnout. And what I would like to know from Mr. Sheridan is about three weeks before the election, I was told that New Jersey Republicans approached the federal district court under whose jurisdiction this consent decree was issued, i.e., Judge Day BeVoix, who you mentioned before, and asked him to reopen the consent decree right before the election. The judge threw the Republicans out of court within 15 minutes and said it would, said, you'll do nothing of the sort. But we never knew why you were going there, and now it makes a little bit more sense. I think Mr. Sheridan needs to tell us why they were trying to change that consent decree.

MR. SHERIDAN: I think around -- well, we weren't trying to change the consent order. I think you have your facts wrong. We did as a Republican Party go before Judge Day BeVoix to have our election day compliance program approved by the court, and the actual ruling by the judge was -- and he did dismiss the suit because the activities that we said that we were conducting during our election day activities were well within his original court order, and there was no need for another order. If you read the transcript, that's what it says.

MR. MacNeil: Because in 1981, you'd hired some policemen or off duty policemen and some of them stood in the polling places with guns, and that was interpreted as an effort to win, and they challenged some black voters as their right to vote, and that was interpreted by the court as an attempt to intimidate black voters, am I right?

MR. SHERIDAN: Well, I think there was -- there was an action with regard to -- there was a consent order with regard to that activity, is what occurred.

MR. MacNeil: Yeah.

MR. SHERIDAN: But I think the important point is, is that there was no suppression of voting this time around. I mean, the program that Ed Rollins had said existed just did not exist.

MR. MacNeil: Well, do you think no investigation -- excuse me, Mr. Begala -- do you think no investigation of these facts is needed, other than before going before the judge and showing your election expenditures?

MR. SHERIDAN: No. We want a full disclosure of all the facts. We want to work with all appropriate authorities in order to make sure there's a full disclosure of the facts, and the Democrats have chosen to go before Judge Day BeVoix. We feel that's the appropriate spot, and we think that the judge could say how this matter should be handled.

MR. MacNeil: Would that satisfy you and your readers, Ed Baumeister? Is that a sufficient investigation, or way to proceed?

MR. BAUMEISTER: Well, you know, this is unfortunately going to come down to looking for some black ministers who might have taken money and, and find out what Republican operatives might have done it. The problem is the way we run our campaigns is just dreadful. There's too much money in them. Not only did the Whitman campaign have 5.9 million dollars and a cap, by the way, by law, and Florio the same amount, but the Republican Party had money. The assembly Republicans and Democrats had money. The Senate Republicans and Democrats had money. There's too much money put into these campaigns. And as I said before, they're lousy campaigns. I would - - they don't campaign on the issues. This campaign wasn't on urban issues or, God help us, even on suburban issues. I hope what comes out of this is a broader view of how these campaigns are conducted and some reform instituted, so they become again meaningful and not just multimillion dollar conglomerates.

MR. MacNeil: Finally, Paul Begala, and then I'll go to you, Mr. Sheridan, does the Florio camp believe that there may be in this grounds for annulling this election since the result was relatively close and having a new election?

MR. BEGALA: Well, in fact, the result was closer than the statistic that you reported earlier. The final vote tally at the end was 25,628 votes.

MR. MacNeil: We were giving the figure quoted in the Washington Post and the New York Times. You say it's 28,000?

MR. BEGALA: It was 25,628.

MR. MacNeil: Twenty-five thousand. Uh huh.

MR. BEGALA: Yes. That's 1 percent of the turnout.

MR. MacNeil: That reinforces my point. Do you believe that there may be at the other end of this investigation grounds for annulling the election and having a new election?

MR. BEGALA: The only way to know is to conduct a real investigation where, again, where people like Mrs. Whitman, like her brother, who was her campaign manager, Dan Todd, when Mr. Rollins, himself, and whoever else may have been involved in this alleged effort to drive down African-American turnout is put under oath in a proper court of law, a proper forum, where they won't have the option of simply just saying, oh, I just made it up, and we recanting if it becomes politically uncomfortable.

MR. MacNeil: Thank you. Do you conceivably believe, Mr. Sheridan, there could be grounds for annulling this election at the bottom of this?

MR. SHERIDAN: Absolutely not. I mean, this -- there was a fair election. The undertakings of both the Republicans and Democrats during this election are well within the parameters of the law. There is this statement by Ed Rollins that will be tested before Judge Day BeVoix, and after that, I believe that this matter will be behind us.

MR. MacNeil: Okay. Well, it's behind us for now. Thank you all. FINALLY - REMEMBRANCE

MR. LEHRER: Finally tonight, this Veterans Day was marked by a special ceremony, the dedication of a statue honoring women who served in the military during the Vietnam War. The statue is part of the nation's Vietnam Memorial in Washington. The ceremony today included speeches by Vietnam vets, the women involved in funding and creating the new statue, and a march that was part parade, part reunion.

[CEREMONY EXCERPTS AND REUNION ATMOSPHERE]

WOMAN: She was my head nurse, and she just kept me going. You're the only person as far as I can remember. [crying and tears] Thank you. Thank you for finding me.

OTHER WOMAN: Oh, God! I wondered where you were. [MARCHING WOMEN SINGING]

MALE VETERAN: We love you. God bless you all. Thank you for saving my life.

CHAPLAIN ALICE FARQUHAR-MAYES, Vietnam Veteran: We went into the hell with the willingness to touch, to hold, to listen, to care, came home forever changed. We were and we are every woman. We now come to you and to this sacred time to remember and to be remembered. We come to bear witness and to be heard, to honor and to be honored, to touch and to be touched, to celebrate and to come home.

DIANE CARLSON EVANS, Chair, Vietnam Woman's Memorial Project: Let no one ever forget you again and what youdid for this nation, and don't ever hide the fact again that you are a veteran of the Vietnam War. It's been a long journey here from Vietnam and other parts of the world where you served, but the journey for most of us still isn't over. Many are just beginning their healing but this is our place to start. We have waited for this day, but we have also feared for this day. We feared that it may never happen. We feared that the nation wouldn't care, and we feared that we would never find a monument that would meet the approval of the federal agencies in this town. [applause] And we feared that those who said ours was the impossible dream were, were maybe right.

GLENNA GOODACRE, Sculptor: My desire to create a lasting tribute to the women who served in Vietnam is founded upon my deep respect for each one of them. The woman holding the soldier I've always called "the nurse." You know, 90 percent of the women who served in Vietnam were nurses. She's holding this soldier. She cradles him across her lap. To me, this man is unconscious but he will live. I purposely covered his, the top of his face so he would become more anonymous, so he could be anyone's son, he could be a brother, he could be a father. She is serving as his life support. The standing woman is looking up, perhaps for the Medivac helicopters, maybe she's looking up for help from God. She has her hand on the nurse's elbow, and Diane has told me so many of the nurses and the women read so much into that because it shows the compassion and feeling they had for each other because they became such close friends during the time they served. That my hands can shape the clay which might touch the hearts and heal the wounds who served feel me with deep satisfaction. Veterans, this is for you! Thank you. RECAP

MR. LEHRER: Again, the major stories of this Veterans Day, the President signed a cost of living increase for the nation's 2.5 million disabled veterans and the United Nations approved tighter sanctions on Libya for its failure to surrender suspects in the 1988 bombing of Pan Am Flight 103. Good night, Robin.

MR. MacNeil: Good night, Jim. That's the NewsHour for tonight. We'll be back tomorrow night with Mark Shields and others. I'm Robert MacNeil. Good night.