The NewsHour with Jim Lehrer

JIM LEHRER: Good evening. I'm Jim Lehrer. On the NewsHour tonight, Margaret Warner looks at new bedfellows on reforming health care; Tom Bearden updates the Hurricane Floyd recovery story in North Carolina; Ray Suarez interviews the head of the World Trade Organization; and Terence Smith and crew peruse a new crop of Republican campaign ads. It all follows our summary of the news this Thursday.

NEWS SUMMARY

JIM LEHRER: President Clinton today urged Israel and the Palestinians to compromise on a final peace accord. He met with Palestinian Leader Arafat at the White House. Mr. Clinton said he wants to help the two sides reach a mid-February deadline for a framework agreement.

PRESIDENT CLINTON: As in any process like this, there must be inevitable and difficult compromises. No one can get everything that either side wants, but I'm convinced we can get there and I'm convinced that Chairman Arafat is proceed in good faith so I'm glad to see him.

JIM LEHRER: Arafat said he expected difficulties in the peace talks, but he said negotiations would deal with them. Senator Jesse Helms went before the United Nations Security Council today with a warning. The chairman of the Senate Foreign Relations Committee said the UN must cut spending and reform itself. He said that's the price for a Congressional agreement to pay nearly $1 billion in US back dues.

SEN. JESSE HELMS: I suggest that if the United Nations were to reject this compromise, it will mark the beginning of the end for US support in the United Nations and I don't want that to happen. I want the American people to value-- to value-- a United Nations that recognizes and respects their interests, and for the United Nations to value the significant contributions by and of the American people.

JIM LEHRER: The Senator's remarks drew criticism from some. The French ambassador said the US Must remember it's not the only country with a voice at the UN Senator Bob Kerrey of Nebraska announced today he will not seek reelection to a third term this fall. Kerrey is a former governor of Nebraska who unsuccessfully sought the Democratic Presidential nomination in 1992. Serving as a Navy seal, he won the Congressional Medal of Honor in the Vietnam War. He made his announcement in Omaha.

SEN. BOB KERREY: It's a deeply personal decision but I feel like my spiritual, interpersonal and creative cistern needs to be filled back up. It's not that I'm leaving as a consequence of being unhappy. It's just that inside my heart, I feel like going back to private life is the best choice for me and my family.

JIM LEHRER: Kerrey said he's considering an offer to become President of the New School University in New York City. Overseas today, Israel's attorney general ordered a criminal investigation of President Ezer Weitzman. He's accused of illegally accepting money from a French businessman and friend. He said the money was a gift, with no strings attached. An aide said Weitzman has no intention of resigning his largely ceremonial post. In Indonesia, the government tried to calm religious violence on two resort islands after a week of bloody clashes between Muslims and Christians. We have a report from Mark Austin of Independent Television News.

MARK AUSTIN: On the holiday island of Lombok today, the Christian community is herded together in a temporary refugee camp, huddled together, living in fear of their lives. This is what is left of their churches, their homes, and their businesses, the target of Muslim gangs. The last foreign tourists were leaving Lombok today, heading to nearby Bali on ferries. Britain is among countries warning its citizens to stay away from these islands, where tension remains high. Riots broke out in Lombok earlier this week, with cars attacked and overturned. It is just one of several islands in Indonesia to be hit by sectarian violence that's gone on for more than a year. Today, the new government unveiled its first budget, promising increased investment in provinces stricken by violence. At the same time the government is sending in hundreds of troops to try and restore calm to the islands of Indonesia. Tonight top generals here in Jakarta have denied they're planning a military coup against the country's newly elected democratic government, a government under increasing pressure as sectarian violence continues to flare up across this massive country.

JIM LEHRER: Back in this country, Governor Jim Hodges of South Carolina has made his strongest appeal yet to remove the confederate flag over the statehouse. He did so in his State of the State address last night, saying the dispute has claimed too much time and energy. He called for moving the flag to another site on the statehouse grounds. About 50,000 people demonstrated there Monday, demanding the flag be brought down. They call it a racist emblem. Supporters call it a symbol of their southern heritage. A new class of low-power FM radio stations was approved today. The Federal Communications Commission action would allow for at least 1,000 new stations. They'd be run by community groups, churches and schools. The aim is to create more diversity in programming, such as alternative music, educational, and religious shows. And that's it for the News Summary tonight. Now it's on to new alliances on health care reform; recovering from Hurricane Floyd; running the World Trade Organization; and Republican campaign ads.

UPDATE - HEALTH INSURANCE

JIM LEHRER: Margaret Warner has the health care story.

MARGARET WARNER: Extending health insurance to the nation's 44 million uninsured got a boost yesterday from two players who have hardly been allies in the past. First, President Clinton proposed spending $110 billion over ten years to expand the children's health insurance program, known as chip, to cover more poor children; insure the parents of poor children now covered by CHIP or Medicaid; give workers between 55 and 65 a 25% tax credit to buy into Medicare; and give out-of-work Americans a tax credit to pay for coverage in their former employer's health care plan through the so-called cobra plan. The president was asked about the prospects.

QUESTIONER: What makes you think that you can get a more expansive health care program through Congress this year than you were able to get through last year?

PRESIDENT CLINTON: I believe if you just look at what's going on in the election season this year, the public cares a lot about health care, and they're talking a lot about it. And all these people, without regard to their party, who come here in Congress, they've been home talking to the people they represent, they've been listening to this. They know what their folks are up against, they know what kind of problems people face with long-term care.

MARGARET WARNER: Also yesterday, the Health Insurance Association of America, the trade group that helped defeat President Clinton's 1993 health care plan, issued another in its series of "Harry and Louise" television ads, with a very different twist.

MAN IN AD: News on the web?

WOMAN IN AD: 44 million Americans without health insurance.

MAN IN AD: That's huge, an epidemic.

WOMAN IN AD: That only coverage can cure.

MAN IN AD: We can't leave working families and kids without insurance.

WOMAN IN AD: Well, someone actually has a workable plan, called InsureUSA. It has tax relief for workers and small businesses, and special help for the working poor.

MAN IN AD: But not government-run health care.

WOMAN IN AD: I'm e-mailing this to the candidates.

MAN IN AD: Send them a message.

SPOKESPERSON: Coverage is the cure for millions of Americans. Log on to help.

MARGARET WARNER: The President was asked about this new development.

QUESTIONER: You think Harry and Louise may support you this time?

PRESIDENT CLINTON: Well, I hope so. You know, they've been acting like they want to support me, and I'd like to get together with Harry and Louise. I thought they were pretty effective last time, and we ought to be on the same side. I'd love it if Harry and Louise would sidle right on in here and say this is the greatest idea since sliced bread, and we could go forward together. It would be great.

MARGARET WARNER: For more, we're joined by, Run Pollack, executive director of Families USA, a consumer health advocacy group; and Chip Kahn, president of the Health Insurance Association of America, the insurance industry trade group whose ad we just saw. So, Chip Kahn, are we going to see Harry and Louis showing up in the Oval Office to endorse this plan?

CHIP KAHN: Well, we really think the President is moving in the right direction. We're appreciative of his plan that recognizes that the current system ought to be built on that employers and the public sector are doing the right thing now and we should build on programs that work. And we think particularly his focus on needy people, particularly those parents of children who qualify for other programs, is a great start. We have some issues with Medicare side of it. We think we can help people between 55 and 65 in ways other than expanding Medicare. But on the whole we think the president is moving in the right direction. We're excited about him opening up to this new initiative.

MARGARET WARNER: Ron Pollack, your group has, in the past, advocated far more sweeping change. Does this proposal measure up?

RON POLLACK: Well, incrementalism is not a four-letter word. So I thinkif we move in the right direction and cover people who are uninsured, particularly the people who need it the most, that's very helpful. Now, the parents of children who are eligible for CHIP and Medicaid, that's a group that's been left out in the cold. So, when the President put that issue on the table, covering these parents through Medicaid and CHIP, I think he did a great service.

MARGARET WARNER: Chip Kahn, to many veterans... I think many veterans of the health care world are really stunned by this new Harry and Louis ad. I mean, it certainly endorses at least the President's goals. I know you have your own proposal but why the turn-around?

CHIP KAHN: Well, our industry has always been for covering more Americans. We do best in an environment in which everybody has access to coverage. So this is really for us nothing new. In the past we had concerns about the way the President wanted to do it, and that's why in '93 and '94 Harry and Louise asked all those nasty questions about the President's plan. But for us this is part of a continuum. We are really appreciative that the president is recognizing that we need to build on the system we have now. We think if we build on the employer-based system, employers providing coverage, finding...helping employers who have low-wage workers provide coverage and if we can build on this child health program that really works and include, as Ron said, those adults who are parents that the President is talking about and we hope we can find ways to provide some coverage for those poor adults who aren't parents but who need coverage. That's how we'll help the 55 to 65-year-olds we believe.

MARGARET WARNER: But to many people, Ron Pollack, looking at this, the two you would look like pretty strange bedfellows. I mean, how do you explain the shift? Are you each moving more toward the other, or is one moving more? Explain this.

RON POLLACK: Well, I'm not sure we're bedfellows. We're in the same room. We don't talk about each other's lineage anymore. I think that although we have profound differences on things like patients' rights and a whole bunch of other things and we'll continue to have those differences, on this issue of the uninsured, we're seeing a dramatic and tragic growth in the number of people who are uninsured. And so many of them are people who simply can't get coverage through the current means. If you are earning less than $7 an hour in wages, you're less than one out of two likely to be able to get coverage from your employer. And you're going to need financial help getting that coverage. So let's build on Medicaid and CHIP, which work, and I think to the extent that Chip Kahn and the Health Insurance Association of America are willing to move in that direction, as we are, we can find common ground.

MARGARET WARNER: So, Chip Kahn, your group is willing to endorse this even though it's really an expansion of government programs. I mean, CHIP and Medicaid are not private insurance programs.

CHIP KAHN: Well, at the end of the day, to help those people who lack the wherewithal to purchase the insurance, the kind of people that Ron is talking about, there have got to be bucks from some place. Actually if you look at the last knew years there's been significant growth even for poor people from employer coverage.

MARGARET WARNER: I'm sorry.

CHIP KAHN: But the Medicaid program is covering less people every day. And, frankly, it's going to take public programs to get the bucks to help those people find coverage.

MARGARET WARNER: But what I'm trying to understand is why wouldmembers of your group who are, after all, in the private insurance business, be for this, very simply?

CHIP KAHN: Well, we're in the business of providing insurance. But we don't mint money. And so to get these people help, there's got to be some targeted assistance from the taxpayers to get them the money so they can purchase the coverage.

MARGARET WARNER: So, Ron Pollack, you heard the President, we heard the President also argue that he thought the political climate in the country and in Congress and politically had changed since the debacle for his plan in '93, '94. Do you see that? Do you think the climate has changed?

RON POLLACK: Oh, I think so. I think we're seeing in each year in the past decade a substantial increase in the number of people who are uninsured. And this is despite the fact that the economy is in great shape. Unemployment is down. The deficit has been eliminated. We've got low inflation. So, imagine what happens if the economy turns sour. And I think what's different, and the reason HIAA, and Families USA are in the same room together is I think we realize we can't continue along this track. We just cannot have more and more people become uninsured. And, in the past, the way groups proceeded, they said, "here's my plan and if you don't like my plan, I'm leaving the table." So they stuck with the status quo. Now I think groups are saying, "we really need to find common ground."

MARGARET WARNER: So, Chip Kahn, before you had job, you were a very close advisor to the Republican leadership on the Hill. Do you think this new political climate is affecting Republicans as well as Democrats?

CHIP KAHN: I think it definitely will. I think there's an interest on the public's part in getting more people covered. It's not the same anxiety about themselves for the middle class that they may have felt in '92 before the '93/'94 period but I think the concern is growing. And that's why so many Republicans on Capitol Hill are talking about changing the tax law to try to help people. I hope that we can talk them into considering also as well as tax changes some of these improvements to the programs like the child health program because I think at the end of the day for the poorest Americans who don't now qualify for other programs, that's the only way to go.

MARGARET WARNER: So, in other words, you're saying that your group has moved from the classic, what one might call the classic business position of let's just do it all through the private sector to be willing to urge your allies in congress to do a combination?

CHIP KAHN: Yes, we can provide the coverage. And we would hope that as many of these people will be covered through the employer coverage or other private coverage as possible. But at the end of the day particularly for people in that low end, if they're working, they just lack the bucks to purchase health insurance. And we need to help them. That's why we're supporting these kinds of proposals -- our own proposal which is so similar to the President's.

MARGARET WARNER: Now, among Democrats, of course, Ron Pollack, as we see in the Bradley-Gore dispute on the campaign trail, there are Democrats who still want a big approach. Where do you think the political energy is on that side of the aisle?

RON POLLACK: Well, I think people still have a vision to get to universal coverage. I think all of us believe that. But I think people also recognize we've made lots of attempts to get there in one fell swoop. And maybe the voyage needs "a" step. And so what we're trying to do is find common ground, build on what works. Medicaid covers 40 million Americans. CHIP is growing very nicely. And so, we want to build on what works. And we think that can take us in the right direction.

MARGARET WARNER: So, bottom line: Do you think we'll see anything from Congress this year -- lame-duck President in an election year?

RON POLLACK: Well, it's always tough to get something passed in an election season, but I think we've got a really good shot. And we certainly, I think, have a very good shot of doing it in the following Congress.

MARGARET WARNER: Chip Kahn, prospects for this year?

CHIP KAHN: Well, I agree with Ron. I think it's going to be a long row to hoe but if there's a big tax bill, there's a chance. Remember, the child health program was included in the Balanced Budget Act of '97. So there's a chance. But I believe that whether or not it happens this year, it will happen in the next two years, in 2001, and we're working... we'll work hard this year but we're building towards next year. This is an important issue this the campaign, in the presidential campaign. And I believe we're going to see a change here. We're putting Harry and Louise out because we want to see that change as soon as possible.

MARGARET WARNER: All right. Well, thank you, Chip Kahn and Ron Pollack.

UPDATE - SLOW RECOVERY

JIM LEHRER: Now a Hurricane Floyd update from North Carolina, where the struggle to rebuild is far from over. Tom Bearden reports.

TOM BEARDEN: Last September, Elsie Stokes was throwing away nearly everything she owned. Her house had been inundated by nearly five feet of filthy water. The flood was caused by torrential rainfall from Hurricane Floyd, the worst flood in North Carolina history.

ELSIE STOKES: This is the worst. It's... It's like you have everything, and waking up with nothing-- nothing, nothing, not even a roof over your head.

TOM BEARDEN: Nearly four months later, Elsie and her husband, Jimmie, have a roof over their heads, but it's an aluminum roof. They and their 18-year old son, Travis, are living in a tiny camper trailer supplied by the Federal Emergency Management Agency. It's parked next to their ruined home.

JIMMIE STOKES: I mean, we're trying to be real patient with each other. We're trying... You know, and... It... It... It's hard. It's hard when you want to rest and you need rest, you can't rest.

ELSIE STOKES: I guess the hardest part is we are used to electricity and being able to cook dinner and have a nice dinner, and right now we are kind of just eating out of bags. You know, we're eating a lot of soup and eating a lot of frozen things, and that's hard, because I don't feel like I'm feeding my family like I ordinarily would.

TOM BEARDEN: The Stokes are among 4,200 people living in travel trailers and mobile homes, some parked on their own property, others in large parks like this one near Rocky Mount. Jimmie Stokes is trying to get out of the camper and into a new home and is finding the process extremely frustrating. Stokes' home had almost $80,000 in damage. FEMA gave him a one-time payment of $7,000. So he decided to apply for a low-interest disaster loan to build a new house. FEMA has a contract with the Small Business Administration to run that program. Stokes started laying a foundation, but says he's getting the runaround trying to complete the process. The SBA approved a loan to rebuild his old house, not a new one.

ELSIE STOKES: We're calling them weeks apart, because each time we call, they say, "oh, we don't have your stuff in front of us. Let us go get it. We'll call you back." They don't call you back.

JIMMIE STOKES: They don't call you back.

TOM BEARDEN: How many times has that happened?

JIMMIE STOKES: 15, 20 times, at least.

TOM BEARDEN: And they don't call you back?

ELSIE STOKES: No, and every time you get a different person you are talking to. Nobody is holding your case. One girl says, "okay, you call and ask for me." So I call and ask for her, and then she acts like she don't even remember me.

TOM BEARDEN: There are similar complaints in Princeville, a town founded in 1865 by former slaves. Even though contractors are clearing away rotting mobile homes to be replaced by new ones, people say the work was slow in starting. Nearly all the houses in this subdivision are being gutted. Warped joists and crumbling sheet rock are being replaced; new plumbing and appliances are being installed. But Teresa Byrd says the government wasn't much help.

TERESA BYRD: It flooded out. We tried to get help. They denied us. We tried three more times. They denied us again. So then we went to SBA and then finally got a loan from SBA, but FEMA didn't help.

TOM BEARDEN: So, how did you survive in that time?

TERESA BYRD: It was hard. Red Cross, people just giving out stuff, shelters.

TOM BEARDEN: How far is that going to go?

TERESA BYRD: Just to fix up the house. And what about furniture, clothes? We don't get nothing for personal property.

TOM BEARDEN: James McIntyre is a public affairs officer with FEMA.

JAMES McINTYRE: FEMA is dealing with over 1,000,500 people that have been devastated by disasters throughout the nation. In this particular state alone, North Carolina, there's over 80,000 victims. So that creates some of the delay, because so many people are involved. And then there are different areas where administrative things, things that they need to provide, deeds and things that were lost in the flood, and that takes time. So the process does have some delays built in, but basically people are getting what they need as quick as possible.

TOM BEARDEN: Stokes says it's not only the delays that gall him. He's upset the government only offered him a loan instead of the outright $20,000 grants it gives to poorer people. And he resents the aid given to victims of overseas disasters.

JIMMIE STOKES: I paid my taxes. Like I said, I've never asked for anything from them. But they can go out and help these foreign countries, and I'm sure they ain't paying it back. But when it comes time to needing them, they haven't helped us. All they done was give us a bunch of paperwork.

TOM BEARDEN: North Carolina's Deputy Commissioner of Agriculture, Weldon Denny, says he's hearing similar complaints from farmers.

WELDON DENNY: I hear that almost daily. People call in and say, "well we'll send $8 billion to Honduras or somewhere, and we can't get a billion dollars set up for our own people." And that's true, and that's hard to answer.

JAMES McINTYRE: Based on the law as it's established right now, the Small Business Administration is the bank for FEMA, and it offers loans to people to recover from the process. Those people who are determined that they can't repay a loan are given grants through funds that are provided to the state. That program is administered by the state, you know, which was affected by the disaster. As far as money going outside of the country, that's a different law, a different program, and we can't comment on that.

TOM BEARDEN: Denny says a lot of farmers are having an even tougher time than homeowners in getting loans because FEMA doesn't cover agriculture.

DOUGLAS MAREADY, Farmer: Yeah, I went to the government for loans. And I went and talked to them, but that's about as far as it got. I found out quickly that I didn't qualify for nothing they had.

DOUGLAS MAREADY: Come on!

TOM BEARDEN: Douglas Maready raises turkeys near Kenansville. The flood drowned 6,500 turkeys and left him with a huge cleanup problem. The state hired a Pennsylvania hazardous waste company to dispose of the carcasses, but his turkey houses were damaged in the cleanup. He also lost his crops and had no flood insurance because the land had never flooded before.

DOUGLAS MAREADY: It's been kind of slow to get everybody to agree to throw us a life preserver. Sort of like a drowning man, you know -- you've got so many people that's got to agree to throw that life preserver until it slows everything down, and in the process there's people that's going under.

TOM BEARDEN: Maready says he'll survive by dipping into his retirement nest egg. But Commissioner Denny says not all North Carolina farmers will make it.

WELDON DENNY: There's about probably 5%, 10% of them that may not get... May not get back at all.

TOM BEARDEN: That's a pretty big number, 10%.

WELDON DENNY: It is. It is. But... And it may be too big. I hope it is. But when you can't... When you can't get a loan or you're not able to repay a loan if you could get one, and you were marginal to begin with, and your prices are as low as they have been and are still, some of them, it's very difficult for them to get back into business.

TOM BEARDEN: The biggest surprise in the wake of the flood is the lack of environmental impact from the inundation of hundreds of municipal sewage treatment plants and the waste lagoons of dozens of large-scale hog raising facilities. The hog lagoons have long been controversial, but predictions of dire consequences if they were breached were not realized. Bill Roper is the dean of the University of North Carolina's School of Public Health.

BILL ROPER: It didn't happen. Does that mean we can go right on with the current arrangements for disposal of hog waste? I don't think so. Just because we didn't have a major problem that we can document right now, I think it's still highlighted to all of us, whether you're a pork producer or a public health official or a homeowner in the community, that there's some issues that we just need to do a better job with, and I think that's important.

TOM BEARDEN: Even if the hog waste didn't turn out to be an immediate problem, it and other organic material and sediment may have a long-term impact on a commercial fishery on the Atlantic Coast. North Carolina's Secretary of Environment and Natural Resources, Bill Holman, says the state is carefully watching Pamlico Sound.

BILL HOLMAN: We still don't fully understand the impacts, and we're... With support from Governor Hunt and the general assembly, we've stepped up and enhanced work quality monitoring effort, so we can watch what's happening in the Sound this spring and summer. But it'll probably be this time next year before we really know the full impact of the hurricanes.

MUSIC: Got to be cool now got to take care...

TOM BEARDEN: Life will return to a semblance of normalcy for some Princeville residents in a couple of weeks when they're able to move back into their rebuilt homes. For the Stokes family, it'll be at least five months before they can move into their new home. That's the shortest amount of time it would take to build the house, longer if there's any more delay in getting their disaster loan.

JIM LEHRER: Still to come on the NewsHour tonight, the headof the World Trade Organization, and some Republican campaign ads.

FOCUS - TALKING TRADE

JIM LEHRER: Now, the man at the head of the world trade organization, in Seattle and beyond, and to Ray Suarez.

RAY SUAREZ: New Zealander Mike Moore has had a tumultuous four and a half months as director general of the World Trade Organization. In December, he pushed hard for a new round of trade negotiations at the high-profile WTO meeting of ministers in Seattle. But the talks collapsed, setting off a fierce debate about the role of the WTO and the benefits and pitfalls of global free trade. Outside the meeting, tens of thousands of protesters denounced the WTO for, among other things, trampling on environmental regulations and undermining worker rights. The angry protesters blocked streets and access to the Seattle meeting hall, forcing the cancellation of the opening ceremony. Police responded with tear gas and pepper spray, imposed a downtown curfew, and arrested almost 600 people. There was discord inside the meeting hall as well, and not just from the occasional demonstrators who tussled with security. Ministers from 135 countries had sought to start a new round of talks on reducing trade barriers. Under the WTO, countries agree to abide by the same trading rules. But the ministers clashed on what issues to include in the negotiations. Key sticking points included minimum labor standards, agricultural tariffs, and U.S. anti-dumping laws. Caribbean, African and other less developed nations also complained that industrialized nations like the U.S. had shut them out of negotiations.

SHRIDATH RAMPHAL: This should not be a game about enhancing corporate profits. This should not be a time when big countries, strong countries, the world's wealthiest countries, are setting about a process designed to enrich themselves.

RAY SUAREZ: Post-Seattle, Moore has been back at the WTO'S Geneva headquarters, and has been busy meeting with ministers in hope of resuscitating the trade talks.

RAY SUAREZ: Mike Moore has served as New Zealand's trade minister and briefly as prime minister. He joins us now. Welcome to the program.

MIKE MOORE: Thank you.

RAY SUAREZ: What are the issues that are hanging over from Seattle that really need attention, that it was hoped or understood would have at least begun to get the attention they need there?

MIKE MOORE, Director-General, WTO: Well, there's a number of issues. We have what we call the in- built agenda, those things we ought to be talking about anyway. That's agriculture, that's services, and a whole series of other areas we need to pay attention to. Electronic commerce -- here's an area that's booming, jobs are being created-- this is a great new period of economic history. And we'd argue one of the reasons that electronic commerce has been able to accelerate at such a pace and provide such opportunity throughout the world has been the fact that we've had agreements on telecommunications, that we've had a pause with no tariffs or taxes on electronic commerce. So all these things need to be addressed. And we have members, of course, who are from poor countries, very poor countries, who have huge difficulties in being able to absorb what's been decided already of engaging and lifting their own living standards and helping their people. So for the least developed countries and for developing countries, there is something there.

RAY SUAREZ: The Seattle meeting began right after you took office as the general. Looking back, and with everything you've learned since, do you think the agenda was too ambitious, that you never could have gotten a lot of these things done, even if things had gone better?

MIKE MOORE: Well, I am brilliant in hindsight. You know, I can solve every problem a year later. I think our problems were that we... we were too far apart in many areas. The differences were too great. We needed to do more work in Geneva. It was very difficult for ministers to be... to have in front of them so many brackets. And the differences were not just North-South, between Europe and America, and we've got to narrow those differences before we go back to our ministerial. I've talked to 30 or so ministers on the phone since Seattle and met a number, and they do not want to move to another meeting unless we're much, much closer together.

RAY SUAREZ: Well, in the weeks after Seattle, some ministers said that they were surprised, looking back, that there had been no blocked meetings before Seattle to sort of get the ducks in a row.

MIKE MOORE: Well, no, that's not fair. We did have a number of meetings beforehand. But we're a major organization now. We've got over 130 members, but our culture's based on the old GATT of 30 or so members, and we have institutional difficulties. But really, we failed because on major issues of substance, we weren't close enough to give them...let no one say it was a North-South thing only; it was not just that. It was between Europe and the states, agriculture, tariffs. This is major stuff. This is not a conference where ministers can go along and pass wonderful resolutions of world peace, humanity, and it's love each other, then go home. Every word that we negotiate is real, and then you are bound by it, so, you know, great issues are stake, and it is difficult.

RAY SUAREZ: But I'm wondering if some of them aren't mutually exclusive, that really we saw just how difficult it is going to be to get to yes on some of these issues. Crops are either genetically modified or they're not; the United States can maintain its anti-dumping regime, which makes other nations upset, or it can't. There's really no halfway.

MIKE MOORE: Well, no, there is ways in which we can meet each other. If you say there's no halfway, we'll never solve these great differences. We have to have a set of words where there's something in it for everyone. So each country feels like they go home with a bit of a win and can negotiate. I think too-- again, hindsight, I didn't say it at the time, so-- is that it is so important for jobs and to assist economies to grow that perhaps we got into a little bit too much detail. We tried to negotiate at Seattle what, in fact, should have been negotiated over a three-year period. And we did that because of the past. We spent seven years in the Uruguay Round.

RAY SUAREZ: And seven years is a long time.

MIKE MOORE: Seven years, yeah. Well, it's getting there, yeah.

RAY SUAREZ: Are countries ready, or did Seattle show us they're not yet ready to deal with their national economic sovereignty-- give that up or give it up to a wider body in the way that the WTO understands it will?

MIKE MOORE: Well, what we've learned is this, isn't it -- that no country can survive and grow without the cooperation of others. You cannot run an airline, you cannot run a tax system, we're not going to cure AIDS or cancer without the cooperation of others. And we, I think, in the last 50 years have learnt that we need to cooperate in a multilateral way. The United States is a shining example. Look at you, your economy's pumping, you have the lowest unemployment rates in 30 years. Everyone's looking at Americans, saying, "how are you doing it?" But despite that, despite the enormous advances your country's made in the last few years, there's still anxiety, there's fear about ownership in sovereignty. And behind that too lurks sometimes a sort of dangerous mood of protectionism, isolationism, "my country knows best." And this comes from small countries. Hell, we have it in New Zealand. You have it in every country. In Europe, an instinctive "are we losing our culture?" "How can we have an integrated world where countries get on and trade better and trade more jobs, and at the same time keep our language, keep our culture?" And these things, these are issues of great anxiety.

RAY SUAREZ: But when we look at some of the less-developed countries, they have an interest in allowing new, young industries...

MIKE MOORE: I would have thought so.

RAY SUAREZ: ...Not to have to face the blast of worldwide competition. That's why we're worried about companies being bought outright by other companies.

MIKE MOORE: That's why you have special deferential treatment for developing countries and the least-developed countries. You know, the least-developed countries account for less than 0.5% of world trade, yet where they have areas of excellence, they're not allowed to export to the United States or to Europe. In fact, your tariffs in the United States against the poorest countries on the planet, are very, very high. And that's true of many countries, just not the U.S. And for them, it's just not trade. Trade in itself is not going to cure all the world's evils. We have a member country whose debt repayments are nine times, or up to nine times, more than they spend on health, in the middle of an AIDS epidemic. So while trade is important, information's important, education's important, infrastructure, and this, all these things are part of getting economies to grow, for those who sit at think tanks in Washington who are looking beyond the next ten years, and are thinking of how you get a strong India; how you create more customs for the West; and for North and South, how do we lift living standards; what are we going to do when we've got another two billion people on the planet within the next 30 years; how are we going handle doubling, the need to double the production of food in the next couple of years; how science is moving so quickly, the moral and ethical capacity to cope with what science is doing around the corner-- these are all issues that don't belong just to the WTO. I mean, we're a tiny organization with 500 staff, for heaven's sake. But there are other institutions. I was with Kofi Annan -- the secretary-general of the United Nations -- earlier, and we were talking of there is a feeling of a sort of democratic deficit. That is, sovereign governments own... the people own the governments, the people own countries, but at the same time you've got to do airport rights, you've got to have patent rights, you've got to all do these things which don't, I think, diminish sovereignty, but enhance it. And I come from a small country, very vulnerable. I've always seen this form of internationalism as protecting the sovereignty of my country, and international institutions run government to government to government by treaties, by arrangements, as advancing the sovereignty of countries, not as a menace to them.

RAY SUAREZ: In the demonstrations in Seattle, we saw the WTO represented as a force, a malign force in the world. How did it come to be that, and what does the WTO have to do to answer those criticisms?

MIKE MOORE: I think in Seattle and elsewhere, we're copping the blame for every excess of capitalism, every problem on the planet -- no matter... No one protests outside the ILO on labor issues, they come to us; or environmental issues, they're coming to us. The World Bank and the IMF went through this in the 70's. It's one of those things that happens. We're blamed for every problem in Afghanistan, for heaven's sake. And at Seattle, you know, it's more like Woodstock-- sincere people, good issues, issues I believe in. We don't have the powers people think we have. We don't want those powers. We don't want a world government. We have got a mandate on trade. We need to work alongside the other institutions to ensure that trade means more than just business. It means jobs, safer world, better world. And that's why I wanted this job, and that's why I intend to do it, and I intend to finish it.

RAY SUAREZ: Mike Moore, good to have you here.

MIKE MOORE: Thank you.

SERIES - AD WATCH

JIM LEHRER: Finally tonight, another of our regular looks at political campaign ads. Tonight, some of the Republicans, and again to media correspondent Terence Smith.

SPOKESPERSON: Good evening. We welcome our six Republican candidates.

TERENCE SMITH: Money talks, especially when it's the leading Republican candidates doing the talking on the pocketbook issue of taxes. The subject is heating up the air waves in Iowa and New Hampshire. Magazine publisher Steve Forbes pursuing the front-running George W. Bush has been running this ad in both states.

WOMAN IN AD: There's something you need to know about George W. Bush. In 1994 he signed a pledge with my organization that he would not support sales tax or business tax increases. In 1997 unfortunately he broke this pledge. He proposed an increase in the business tax and sales taxes. Governor Bush wants people to examine his record to see how he will perform as President. And his record as far as taxes are concerned is a record of broken promises.

TERENCE SMITH: In response, the Republican Leadership Council is running this ad.

AD SPOKESMAN: Steve Forbes' attack ad distorts the truth. We're the Republican leadership council, and our research shows Governor Bush signed the largest tax cuts in Texas history. Sadly, Steve Forbes has a history of unfairly attacking fellow Republicans. Forbes attacked Bob Dole, which helped the Democrats. And now he's doing it again. Call Steve Forbes. Tell him to join George Bush and John McCain in running a positive campaign on the issues.

GOV. GEORGE W. BUSH: There is such a thing as snow.

TERENCE SMITH: Governor Bush also speaks for himself arguing that the Republican contenders should stay focused on tax talks, not trash talk.

GOV. GEORGE W. BUSH: (ad) One of my opponents said my tax cut for America is too big and too bold. Another raised questions about my record. They're both wrong. In Texas you're only as good as your word. In 1997, I cut taxes by $1 billion. In '99, I cut taxes nearly $2 billion more.

TERENCE SMITH: Arizona Senator John McCain takes on his opponents on the issue of the surplus and portrays himself as the true friend of the middle-class family in this ad.

SEN. JOHN McCAIN: (ad) There's one big difference between me and the others. I won't take every last dime of the surplus and spend it on tax cuts that mostly benefit the wealthy. I'll use the bulk of the surplus to secure Social Security far into the future -- to keep our promise to the greatest generation. I'll begin to pay down the national debt so we don't threaten the future of our children. Finally, I'll target the large tax cuts to those who need it most: America's middle-class, working families.

TERENCE SMITH: The Republican air war heated up further this week when Senator McCain demanded that Governor Bush stop running this ad assaulting his tax-cut proposal.

GOV. GEORGE W. BUSH: (ad) I trust the people of New Hampshire to make the right decisions for their families. If he says something I don't agree with, I'm going to point it out. I don't agree with leaving money in Washington D.C., and I darned sure don't agree with saying that you're going to take $40 billion of employer-related benefits and have the people pay tax on them. I think that is a mistake. If you abolish employer-related benefits just to pay for a tax cut, it means working people are going to have to pay those benefits.

TERENCE SMITH: So far at least the Bush camp is standing by its position and its ad.

TERENCE SMITH: For more on taxes and ads, we turn to David Gergen, editor-at- large at "US News & World Report," and Professor of Public Service at Harvard University's Kennedy School of Government; John Carroll, a media and advertising critic who is now managing editor at WGBH-TV's "Greater Boston" news and public affairs program; and Kathleen Hall Jamieson, dean of the Annenberg School for Communication at the University of Pennsylvania. Welcome to you all.

Kathleen Jamieson, let me begin with you and ask you to give us a little help here. Sort it out. We have an acrimonious tone, some conflicting ads and now a demand from Senator McCain that Governor Bush take this last ad that we just showed down. Should he?

KATHLEEN HALL JAMIESON: Yes, he should. The McCain proposal had an ambiguous line in it, the kind of line that would make an English teacher cringe. It had too many nouns modifying nouns so it wasn't clear who was being taxed and who would be exempted. And it was a legitimate point for the Bush people to put the worst possible construction on that and to put up an ad that ran out of worst-case scare scenario. The McCain campaign came back and said that's not what we meant on that line. They clarified. It's now appropriate for that debate to end. The debate is essentially this: Bush says it's $40 billion. McCain says it's $4 (billion). Bush says employer-related benefits and suggests that you're going to lose the ability as a taxpayer to get your tax deduction on that. McCain says no, I only meant that I was going to take it away from the employer. I wasn't going to take it away from the employee.

TERENCE SMITH: So you feel they should take it down.

KATHLEEN HALL JAMIESON: It's appropriate... It was appropriate to air it when he aired it. The clarification is in place. It's appropriate to take McCain at his word and take it down.

TERENCE SMITH: John Carroll, what about the dueling ads at the beginning of the set-up about Governor Bush's record as a tax-cutter in Texas. Where is the truth there?

JOHN CARROLL: Well, I think the Forbes' ad is true but not accurate, not entirely accurate. He has taken one part of it. It hasn't given the overall context. This is what happens in political advertising time and time again. You take something that is true but without the larger context people can't really judge on whether it's a fair assertion, challenge, difference or not. So I think that from that standpoint it's misleading because it's incomplete. As far as the Bush rejoinder, I think that's a little problematic too because this is the second ad from the Republican Leadership Council. And they came out early and said, "Steve Forbes, if you're thinking of running negative ads, don't do it. You have a record of doing this." This is before Forbes ran any kind of ad challenging any opponents at all. So, this is the second time they've gone after him. And I think that tarring him with his 1996 record is a little unfair because Forbes has run a different campaign this year. So, the interesting part to me is the surrogate aspect of it, that neither of the candidates is going out and making these charges themselves or countercharges. What they're doing is getting other people to stand in for them.

TERENCE SMITH: And you regard them as a surrogate for the Bush camp?

JOHN CARROLL: Well I think the Forbes' ad is a Forbes' ad. So they're using the taxpayers....

TERENCE SMITH: I mean....

JOHN CARROLL: I think the Republican Leadership Council, they're not officially associated with George Bush but it's been reported that a lot of the people on there are Bush effort so I think that-- supporters. So I think that Bush, although he's denied that he has anything to do with these, I think it looks like he's involved in them. I think they're certainly carrying his water for him.

TERENCE SMITH: David Gergen, how do you think this is playing politically for Governor Bush?

DAVID GERGEN: I think in Iowa, the Forbes' ad has actually had some impact. At least everything we know is that Steve Forbes is doing better than he was two or three weeks ago in Iowa. He could even pull off a surprise. We'll have to wait and see. It's only a few days away, of course.

TERENCE SMITH: A surprise as in win?

DAVID GERGEN: I'm not sure he could win but he might finish awfully strong. A CBS survey had him up at 25% and Governor Bush at about 43. That's much closer than anybody expected. And it all depends on turnout as you well know in a caucus state. Forbes has a lot of people that he's organized with a fair amount of money from his own pocket, of course, to come out on caucus night. It could be closer than anybody expects. I think that ad has added to it. It's certainly added to the poisonous view between or relationship between Steve Forbes and George W. Bush. I don't think there's any way that Steve Forbes will be on the George Bush ticket or in his cabinet. On the other hand, in New Hampshire, I think that Governor Bush has actually made a little headway had with his ad as well. He had to staunch the flow of blood and he's clearly trying to be more competitive. What the Bush forces had hoped was that they could get through Iowa, win in New Hampshire and this thing would basically be over and he could go on and really strengthen himself for a fall campaign. Now he faces the possibility, I think it's unlikely but the possibility of a surprise in Iowa and the possibility that McCain could do very well in New Hampshire and then he comes... he would then come out of those two not staggering but certainly the race would be much more jumbled. That's exactly what the Bush people do not want. They're mounting a very strong offensive to push back. He's got a strong organization so I would think the governor would do in the next few days could get momentum going again.

TERENCE SMITH: Kathleen Jamieson, how about from the McCain point of view? Do you think he's scoring points with the ad we showed and his others?

KATHLEEN HALL JAMIESON: Well, the ad synergized across the whole tax issue. The question is does the Forbes' ad benefit McCain? It's interesting to note about the Forbes' ad that it is very carefully using language. Bush did propose a business and sales tax increase as part of a reform package. It wasn't enacted but he did propose it, hence he broke the promise. He didn't break all of his promises, however. He did deliver tax cuts but the local taxes were then increased. The mistake in the McCain ad, however, is to imply that the Bush proposal takes the entire surplus for tax cuts. It doesn't. It takes the Social Security surplus and reserves it for Social Security. And then it takes a good part of what's left of the one trillion dollars of the three trillion-- two trillion of that with Social Security. Now there's one trillion left over. And Bush uses a lot more of that, twice as much, in fact, for tax cuts as does McCain. McCain has reserved a bigger portion, in other words, of the total surplus for Social Security. But it's not true to suggest that Bush does not reserve money for Social Security. He does. He saves the full two trillion dollars in the Social Security surplus for Social Security. How is it going to play? It depends on whether people understand the context of the debate and how they perceive the accuracy of these ads. Each of these ads is selectively telling the truth. It's important that people have a context in order to understand the whole issue.

TERENCE SMITH: And what impact, John Carroll, do you these conflicting claims have on the voters?

JOHN CARROLL: Well, I think it's interesting to look at New Hampshire that is sort of going away from the old traditional image of New Hampshire, the "live tax free or die" New Hampshire that we've known for so long. They seem to be moving in a more moderate direction. There are more independents there and the climate is a little more moderate rather than extreme there, the political climate. So I think this is a good gauge of New Hampshire because what John McCain is trying to do is say, "I will give you a tax cut, but I'll give you a reasonable tax cut." And he's really trying to paint George W. Bush's tax cut as a reckless tax cut. Now, that may or may not be fair, but the perception that gets through to the New Hampshire voters is what's most important. And I think the other factor is the Bush people coming back and saying, "John McCain is engaging in class warfare by saying that most of the tax cuts go to the wealthy." Most tax cuts go to the wealthy all the time. I think in the annals of class warfare this is probably more like a slap fight.

TERENCE SMITH: David?

DAVID GERGEN: I think you have to look at the short term and the long term in the short term, the main message that Governor Bush is getting across to New Hampshire is he wants to bring to the presidency a very large tax cut. That's playing well among New Hampshire Republicans. Interestingly enough....

TERENCE SMITH: Predictable.

DAVID GERGEN: Well, interestingly enough among Republicans taxes remain the number one issue whereas among Democrats it's way down the list, so it's helped his campaign in New Hampshire. And if he beats John McCain I think he will do it through the tax issue and his people will see it in those terms. However, in the long term, he's now coming across to the country as a whole as being primarily about taxes. This was not what he was talking about a few weeks ago. A few weeks ago we came on and had a warm and fuzzy set of advertisements from George Bush -- things to appeal to women, things to appeal to independents. He was talking about Social Security, talking about Medicare. The compassion side of George Bush was coming across very strongly. Now as he moves into the tax area in order to win this primary fight, what you hear is the conservative side of George Bush. And that's helping him with Republicans but for the long haul for the general campaign, it's softened him up a little bit. He is not as strong now against Al Gore as he was, say, four weeks ago. His lead over Al Gore has slipped. So that's the risk he runs. In a general campaign, the Democratic candidate, whether it's Bradley or Gore, is going to go heavily after him saying this is a reckless tax cut. It's too big and what you promised New Hampshire Republicans back then may have helped you in New Hampshire but it doesn't help the country.

TERENCE SMITH: Kathleen Hall Jamieson, the tone certainly has changed here. It's certainly become more acrimonious, more argumentative. How is that playing with the voters. Can you tell?

KATHLEEN HALL JAMIESON: The evidence that we've been gathering from our national surveys suggests that the public does not like personalized attack. You notice that most of this is staying in the political domain and focusing on policy. But it also says that the public doesn't like attack -- that's misleading. So here's the question: If the public comes to perceive some of these ads as more misleading than others, will that help shape voting perception? I would agree with David that there's a shift in the Bush tone. I think the thing that's important to note about the Forbes' ad in relationship on Bush is that it speaks to the heart of the Bush claim for the presidency. That is, my record in Texas is the basis for my leadership. I'm the only one who is an elected executive and has this kind of experience. So, the potential for that Forbes' ad to do damage to Bush, if it is believed, is very high.

TERENCE SMITH: All right, Kathleen, David, John, thank you all very much.

RECAP

JIM LEHRER: Again, the major stories of this Thursday: President Clinton urged Israel and the Palestinians to compromise on a final peace accord. And Senator Jesse Helms warned the United Nations to reform itself if it wants the US to pay back dues. We'll see you online and again here tomorrow evening with Shields and Gigot, among others. I'm Jim Lehrer. Thank you and good night.