The MacNeil/Lehrer NewsHour

MR. LEHRER: Good evening. I'm Jim Lehrer in Washington.

MR. MAC NEIL: And I'm Robert MacNeil in New York. After tonight's News Summary, we have a report on today's bus bombing in Tel Aviv and get Israeli and Palestinian views on the Hamas menace. Then two reports on important ballot initiatives in California: Elizabeth Farnsworth on health care form, Jeffrey Kaye on immigration. Finally, Philip Elmer-Dewitt of Time Magazine reports on how the Internet works. NEWS SUMMARY

MR. MAC NEIL: A bomb exploded on a crowded bus in Tel Aviv, Israel, this morning. Twenty-two people were killed, and forty- eight were wounded in the attack apparently carried out by a suicide bomber. A second bus passing by was also damaged in the blast. The Islamic militant group Hamas has claimed responsibility. Israeli officials promised retaliation. They sealed off the West Bank and Gaza Strip, barring thousands of Palestinians from entering Israel. President Clinton called the attack an outrage against the conscience of the world. There was reaction in Washington from the Israeli ambassador to the U.S. and in New York from the Palestinian observer to the United Nations.

NASSER AL-KIDWA, U.N. Observer, PLO: Any actions at the peace process undermines the position of the two parties, that is to say the PLO and the Israeli government, and it does undermine the peace process, itself, there is no doubt about that. But while we should respect the rights of every Palestinian to advocate whatever political views he or she believes in, we have at the same time to fulfill our responsibilities in the field of maintaining law and order.

ITAMAR RABINOVICH, Ambassador, Israel: We are determined to continue the peace process. If these are attacks that are, among other things, directed at the peace process, that seek to derail the peace process, then the answer is to continue the peace process. The only solution to terrorism beyond the operational activity is a political solution, and the peace process is designed to bring a political settlement to the Middle East. We have partners on the Arab side. Their ranks have been threatened in recent days, and together with those partners on the Arab side that are interested in pushing this peace forward, this peace process forward, we will continue.

MR. MAC NEIL: The PLO and the Israeli government went ahead with talks on Palestinian elections today in Cairo, Egypt. An Israeli spokesperson said the discussions were not in-depth because of the bombing incident. We'll have more on this story after the News Summary. Jim.

MR. LEHRER: President Aristide promised to reform Haiti's judicial system today. He did so during his first news conference since returning to Haiti Saturday. He repeated his call for reconciliation which he said had to come from the judicial system. Aristide did not name a prime minister today, but he said he would soon appoint a broad-based government representing all classes of Haitian society.

MR. MAC NEIL: White House Press Sec. Dee Dee Myers said today the Clinton administration has renewed its efforts to lift the U.N. arms embargo against Bosnia within six months. Myers said that if the U.N. does not agree by November 15th to lift the embargo, the administration will consider lifting it unilaterally.

MR. MAC NEIL: The sun came out this afternoon in Houston, and some of the floodwaters began to recede in Southeast Texas. We have a report on events earlier today in the flood area. The reporter is Dan O'Rourke of Houston Station KPRC.

DAN O'ROURKE: This is Houston's worst flood in more than 30 years. There is no accurate count but many thousands of people have evacuated their homes. Like a commander-in-chief, Mayor Bob Lanier rides a fire truck to study the landscape, and the news is bad. Rivers and creeks are still rising. Many citizens are getting fire truck rescues and bus rides to mobile shelters, but on this street a two-month-old baby drowned when the family minivan stalled. In the escape, the infant slipped from his father's arms. In this neighborhood, near the San Jacinto River, almost every one of the eighty-five houses is underwater. Al and Brenda Russin took a boat ride back to their place.

BRENDA RUSSIN: This is our house. We have nothing left.

MR. LEHRER: So far, nine people are known to have died in the Texas floods. Two others are missing.

MR. MAC NEIL: There was mixed news on trade from the Commerce Department today. The overall trade deficit narrowed by nearly 13 percent in August to $9.74 billion. U.S. exports hit an all time high, but more than half of the trade gap was still with Japan, which had a $5.8 billion shortfall with the United States. That deficit climbed 2.4 percent, to the third highest ever.

MR. LEHRER: And that's it for the News Summary tonight. Now it's on to the bus bombing in Israel, two election issues from California, and the Internet story. FOCUS - ATTACK AGAINST PEACE

MR. MAC NEIL: We begin tonight with the latest massacre in the Middle East, the bombing of a bus in Tel Aviv that has left at least 22 dead and for which the militant Muslim organization Hamas has claimed responsibility. Our coverage begins with a report from Tel Aviv by Michael Nicholson of Independent Television News. It contains very graphic scenes of casualties.

MICHAEL NICHOLSON: It is Israel's worst, by far the worst, and the bloodiest, an act of Arab terrorism that has left so many dead and so many injured, some of them so critically they may not survive the day. They were on their way to work and to shop in Dizengoff, Tel Aviv's busiest street, and at the city's busiest hour. The suicide bomber boarded the bus some way back, waiting for it to fill. Then he detonated his 20 pounds of explosives as the driver stopped for more passengers to guarantee the greatest number of dead. And at that moment, a people preparing to celebrate an anxiously-awaited peace became the dreadful casualties of the war within.

UNIDENTIFIED WOMAN ON STREET: It was terrible, really. You can't describe it, how much it's terrible.

MICHAEL NICHOLSON: Hamas, the Palestinian extremists opposed to any peace with Israel by anyone quickly admitted they did it, revenging themselves, they said, for the three agents killed last week in the kidnap of an Israeli soldier. Few in the bus survived, and such was the size of the bomb and the force of its blast, people a hundred yards away were blown bodily through shop windows. Hospitals throughout the city lined up stretcher beds at their casualty units, and throughout the day, emergency calls have been made over radio and television for blood donors.

BENJAMIN NETANYAHU, Opposition Leader: I know it's a difficult time for the people of Israel. I've called for restraint, for people to contain their emotions, which must be bursting at the seams.

MICHAEL NICHOLSON: And that is what Hamas and its bombers are trying to provoke, and that is what the peace makers must now work so much harder to prevent.

MR. MAC NEIL: Now to the views of the Israeli government and the PLO. Colette Avital is the consul general for Israel in New York. Nasser Al-Kidwa is the observer at the United Nations. Ms. Avital, this is the third, if you include the kidnapping, this is the third recent attack. How much of this can Israel take before it destroys the support for the peace process which is somewhat fragile in the Israeli population?

MS. AVITAL: You are right. The peace process is still fragile. Certainly, the peace process with our partners, the Palestinians, and such a task can only reinforce old stereotypes, reinforce old fears. Some people may not still be able to make the difference between the PLO, which is a partner for peace, and the Hamas, which continues. So those are damaging, other than the fact that this is a sad moment and that there is great tragedy and that we have to take action. This is also quite damaging in terms of the public opinion.

MR. MAC NEIL: Mr. Al-Kidwa, how much of this can the PLO take without seeing your authority seriously undermined by these, by Hamas, which claims to represent about 30 percent of the people in Gaza?

MR. AL-KIDWA: Well, I don't think that these estimates are correct estimates, but I agree with you that further actions of that sort which we clearly condemn could endanger the peace process and then could undermine the Palestine Liberation Organization as well. However, as we repeatedly said, we believe the best answer would be continued progress in the peace process and tangible results to be felt by the people.

MR. MAC NEIL: The State Department said today these are acts of desperation because the peace process is working. Do you see the connection between the two, that a greater momentum in the peace process is accelerating this out of desperation?

MR. AL-KIDWA: I believe that this is true, although what I believe that the Palestinian people as a whole do not lend their support to such kind of actions, but at the same time, they want to see some progress in the peace process, economically as well as politically.

MR. MAC NEIL: Does Israel make the connection between the greater momentum in the peace process?

MS. AVITAL: There's always been that pattern, and whenever there was perceived progress, there was always -- it had always been those who have tried to either derail the peace process or to interrupt it. So we will continue on both fronts, if you will, continue the peace process because there will be no quiet and no security until we reach peace, but at the same time pursue terrorists and try to cut down on those who are perpetrating the acts.

MR. MAC NEIL: Mr. Al-Kidwa, you say it isn't 30 percent. You disagree with that. Describe the organization and the funding of Hamas as you understandit.

MR. AL-KIDWA: Well, understanding the original beginning of it, let's face it, it's a shared responsibility between several parties, including the Israeli government, which at the beginning, at the time of fighting, the PLO influence aimed at giving the, the -- giving the possibility of having different organizations. Later on came outside funding basically which was used in the worst possible way at the time the PLO was faced with financial difficulties. However, with the beginning of the serious part of the peace process, which started with Oslo declaration, I am sure that the influence of this group has dramatically declined. We are insistent on the election, the general election as soon as possible.

MR. MAC NEIL: Which were being discussed, those elections were being discussed in Cairo today.

MR. AL-KIDWA: Exactly. The sooner the better, and we believe that it will be among the good answers to such kind of actions.

MR. MAC NEIL: How does Israel understand Hamas and its organization and purposes?

MS. AVITAL: Well, Hamas is a fundamentalist organization aimed not only against Israel but also against the Jews. And I might say that most of the funding comes from Iran. Many of the activities are supported, the infrastructure also is supported by Iran. Unfortunately, as we know, some of the funding also comes from this country, from the United States. And I think some of the activities, especially in the Chicago area, are quite widely known by the media here in this country.

MR. MAC NEIL: You made that comment earlier today and your ambassador, Mr. Rabinowitz, whom we saw on the News Summary, later commented that he understood that that, that U.S. law -- that that was more the state in the past than it is now, that U.S. law enforcement had addressed that. Do you have different information from this?

MS. AVITAL: It is -- for the first time it is really and seriously addressing that but basically even if you take the attack on the house in Biernabulna, where our Corporal Mashan was held last week, we know that the mosque behind it had been financed by money which came from sources here in the United States, that one had found caches of arms inside that mosque, so basically we know that for a long time some of the financing came from this country, still might come, and, therefore, I think it is very important to take action against the Hamas, whether militarily inside the territories, whether politically and in terms of cutting the funds outside of the state of Israel.

MR. MAC NEIL: I wonder, for the PLO, which is trying to crack down on its extremists, especially after the kidnapping and arrested some 200 suspected extremists, I wonder how you cope with it with attitudes like this. The Associated Press quotes a student of English literature and it names him at the Gaza City Islamic University. The name is Abu Mizav, and he was 29 years old, and he was talking about this bus explosion today. And he said, "We all support it. This gives me pride." Now -- and the university is said to be a breeding ground for Hamas support. How do you cope with that?

MR. AL-KIDWA: It will take some time. It will take some kind of education for the people, but, again, these are the absolute minority among the Palestinian people, and again also certain Arab tradition has certain exaggeration in expressing oneself. So I don't want to create the impression that this is really a reflection of the situation among the Palestinian people. This is not the case actually.

MR. MAC NEIL: But, I mean, what does it make you feel as a Palestinian to have not just some anonymous person but a named student 29 years old, who's not a child, hearing about something like this as ghastly as it was say, "We all support it. It gives me pride?"

MR. AL-KIDWA: Yeah. There are all kind of awful things like that in the Middle East. You can hear things like that, and you can hear also on the other side some Jewish settlers taking pride of the massacre committed by Baruch Goldstein against the prayers in Al- Halil. So you have such kind of outrageous activities and outrageous positions on both sides. We have big responsibility to shoulder, but we have no other choice but to go forward and to try to do something about it.

MR. MAC NEIL: Whose responsibility does Israel think Hamas is?

MS. AVITAL: Well, I think it is a shared responsibility right now. We are partners. There is a wider coalition building up in the Middle East, fighting against fundamentalists, and I think basically this is one of the reasons that brought so many Arab states around the conference table, so I would say it is a shared responsibility, and it is a shared responsibility of the world at large. I think one has to work together to combat terrorism.

MR. MAC NEIL: The United States, the State Department and White House said today is getting all of its ambassadors in all the Middle East countries to make strong representations, for instance, to the Syrians and so on. But what can Israel do physically about this? You can seal off the borders with Gaza and screen everybody coming through, but what can you do physically to prevent this?

MS. AVITAL: There may be more arrests. There may be more investigations until we reach the people who committed the crime. I mean, we've got to try to reach those people.

MR. MAC NEIL: But is that your judicial responsibility, or the PLO's judicial responsibility now, if they're in --

MS. AVITAL: Depending if it is in the Gaza Strip, or whether it is in the West Bank, I think there is a very close connection, and I believe that on that there is cooperation.

MR. AL-KIDWA: May I --

MR. MAC NEIL: Yes.

MR. AL-KIDWA: May I make just a small comment here. Actually, we do object to the sealing of the Gaza Strip and the West Bank. We don't think that this is the proper answer. We agree that actions are needed, but the bottom line is there is no military solution, there is only political solution. With more progress in the peace process, with improvement in the standard of living of the Palestinian people, with a different situation for these people, definitely this group or others will become less and less important, and the action then by the police and by other agencies could deal with the situation.

MR. MAC NEIL: The Associated Press reported today that after self-rule administered by the PLO began in Gaza in May that the political leadership of Hamas put out feelers to the PLO about power sharing. Can you tell us about that and how that connected with this extremist activity? Is it correct? Were they rejected? What is the situation?

MR. AL-KIDWA: No, I don't think that it was exactly like that. But our general position is simply the following: that the scene should be open for all kinds of political organizations, all kind of agreement or disagreement politically, as any other democratic society. And we have the elections which should be open for all tendencies, I would say. As such, Muslim groups could definitely be part of the Palestinian experience and could participate in these elections. We don't see reasons for, for the opposite, however --

MR. MAC NEIL: Muslim groups, because you consider the PLO a secular group, do you?

MR. AL-KIDWA: Well, it's partly secular, partly national, and we have also, of course, some devoted Muslims, but I don't think that the organization as a whole could be considered as a Muslim organization. Now, again, we, we had to draw a clear distinction between all this, between the democratic process, on one hand, and any kind of violation, terrible violation of law and order on the other.

MR. MAC NEIL: The way Israel looks at it, is there an analogy here with the PLO, which Israel regarded as a terrorist organization until fairly recently and then agreed to work with it, of bringing the extremists like Hamas into the process the way the PLO was brought in? How does Israel look at that?

MS. AVITAL: There's a difference. We decided that the PLO is becoming a partner the moment the PLO recognized the state of Israel and the moment the PLO decided to abandon terrorism. It will not come probably as a surprise to you when we say that we do not accept the Hamas as possible partners in the elections because they reject the state of Israel, and because they want to continue to fight against it.

MR. MAC NEIL: Is that a point of disagreement between the PLO and Israel at the moment, you say that Hamas political leadership shall not be eligible to be elected?

MS. AVITAL: This is correct.

MR. MAC NEIL: And you are arguing that all of those tendencies should be able to --

MR. AL-KIDWA: Yes. I have to point also to the fact that I don't agree with the consul general with regard to the description of the past, the PLO and its history, but let's not duel into this, into this point. I mean, what's happened has happened, and let's look forward to the future. But concerning, concerning Hamas, we believe that there should not be any inhibitions in the way of the full participation of anybody. Any Palestinian civilian who believes in democracy, who believes in the election, who believes in this experience of transitional period during the transitional period - -

MR. MAC NEIL: And who renounces violence?

MR. AL-KIDWA: No, of course not. This is not permitted under any circumstances.

MR. MAC NEIL: In other words, who does renounce violence?

MR. AL-KIDWA: Oh, I'm sorry. Does renounce violence, yes, because you can't be part of an experience during a transitional period which is, after all, part of the overall agreement between the Palestine Liberation Organization and the government of Israel, and at the same time continue exercising any kind of violent actions, especially if these actions violate the law.

MR. MAC NEIL: How much does Israel believe, beyond what's happening in Palestinian-administered areas, that an agreement with Israel will -- sorry -- with Syria will have some effect on these extremists in terrorism?

MS. AVITAL: It will --

MR. MAC NEIL: Will they shut them down?

MS. AVITAL: I don't think it can shut them totally down, but I think that Syria can have a very big impact. Then if the important rejectionist organizations are in Syria, are in Damascus, we do know that when Syria wants to curb their activities, they're capable, and so it has been proven in the past, so Syria can have a very important input. Certainly one of the things that we would request from Syria is to have that input as far as the Hezbollah coming from Lebanon is, but I think let me just very briefly go back, because I think this is so essential, there is a sense of insecurity in Israel. People do not feel secure when borders are open, we have believed that opening the borders, keeping theborders open would bring peace nearer. This has not been the case. So closing off the territories right now, trying to pursue the terrorists where they are must give the Israeli people an answer and some sense of security in their own homes.

MR. MAC NEIL: I see. Well, thank you both for joining us. Jim.

MR. LEHRER: Still to come on the NewsHour tonight, two reports from California, and what exactly is Internet? FOCUS - CALIFORNIA CHOICES

MR. LEHRER: Now two election reports from California. They involve ballot initiatives concerning two of the largest of issues: immigration and health care. HEALTHY CHOICE

MR. LEHRER: The first is about Proposition 186. If it passes, California would be the first state to have a Canadian-style, single-payer health care system. Elizabeth Farnsworth reports.

DR. BARBARA NEWMAN, Chairwoman, California Physicians' Alliance: [speaking to group] Does anyone here have insurance with no deductibles? [laughter]

MS. FARNSWORTH: This is the front line of the California health care battle, a house party in Santa Rosa, about one and a half hours North of San Francisco.

DR. BARBARA NEWMAN: The fatal flaw in our health care system is that for most people in this country health insurance is treated as a commodity, as a product. It's in the marketplace. It's bought and sold. So if you have resources, if you have money, you get the product, you get health insurance.

MS. FARNSWORTH: Since the drive to get a single payer initiative on the ballot began last spring, Dr. Barbara Newman has addressed more than 100 house parties like this.

DR. BARBARA NEWMAN: It's really not till the whatever hits the fan and we are sick and we need our health insurance, or a member of our family does, that we realize how precarious our health security is.

MS. FARNSWORTH: She tells this group of professionals that if Proposition 186 passes, private health insurance would largely disappear in the state. Instead, Californians would pay a 2.5 percent income tax for state-funded cradle-to-grave health care.

DR. BARBARA NEWMAN: All medical services, prescription drugs, mental health, some dental care, and then long-term care.

MS. FARNSWORTH: And people could still go to the doctor of their choice. A $1 a pack tax on cigarettes and an employee payroll tax ranging from 4.4 to 8.9 percent would help finance the system.

UNIDENTIFIED MAN: I've heard some skepticism about there being enough money there to -- I mean, almost everybody is getting treated for almost everything. Do the numbers add up?

DR. BARBARA NEWMAN: Yeah. I mean, I know it sounds, it sounds too good to be true.

UNIDENTIFIED MAN: I'll say.

DR. BARBARA NEWMAN: So let me tell you some numbers.

MS. FARNSWORTH: Dr. Newman's got the numbers and from authoritative sources, but opponents charge that the figures are too good to be true.

RICHARD CLAUSSEN, Manager, Anti-186 Campaign: Well, clearly, the Achilles Heel of the initiative is its funding.

MS. FARNSWORTH: Richard Claussen is managing the anti-186 campaign from an office in Sacramento. Claussen's firm made the Harry and Louise commercials that played an important role in defeating national health care reform.

HEALTH CARE AD SPOKESMAN: The government may force us to pick from a few health care plans designed by --

RICHARD CLAUSSEN: The initiative is grossly, grossly underfunded. Based on the revenue that they expect to come in versus the expenditures it would cost to do all the wonderful things they claim they're going to do would, you know, would rack up a huge deficit the first year.

MS. FARNSWORTH: To spread this message which proponents of the initiative dispute, campaign workers are sending packets of information all over the state.

WORKER: Convalescent hospitals, pest control companies, New York Life, lots of individuals.

ART YOUNG, Hewlett-Packard: HP spends a little over $2 billion a year on benefits worldwide.

MS. FARNSWORTH: And in campaign press conferences, business leaders are denouncing the potential effects of Prop 186 on the economy.

ART YOUNG: So in round numbers, our cost of doing business in California per year will go up $60 million. And that's certainly not going to make it more attractive to continue to put more jobs in the state.

MS. FARNSWORTH: So the health care battle didn't die; it just moved to California. The anti-186 coalition is made up of insurance companies, the Chamber of Commerce, and the California Association of Hospitals, among other groups.

[DEMONSTRATION]

MS. FARNSWORTH: Working for the proposition is a coalition including the California chapter of the American Association of Retired Persons, the California Nurses Association, and the League of Women Voters.

DREW ALTMAN, President, Kaiser Family Foundation: This is not just about California. This will have tremendous national significance.

MS. FARNSWORTH: Drew Altman is president of the Kaiser Family Foundation, an independent health care think tank.

DREW ALTMAN: I think a lot of people feel that given the demise of health reform, this is a tough time to try and push the most sweeping reform anybody has ever considered in American health care in an increasingly conservative state like California, but because it's a tough time, if it ever passed, which is not expected to happen right now, it would turn the health care debate on its head literally.

DR. BARBARA NEWMAN: I'm in a family practice in San Francisco, and I --

MS. FARNSWORTH: The campaign is an uphill battle for proponents like Dr. Newman. But in Sonoma County, where this house party was held, there's a lot of support for reform. This is vineyard country, the place where some of California's best wines originate. October is harvest time for these cabernet grapes. Some farm workers here get health insurance through their employers but most do not. This man had recently gone to the emergency room of a local hospital to get a growth on his face checked. They told him it would cost $1,000 to remove it. He can't afford it. In the county's small towns which attract tourists from all over the world, business is seasonal, and owners often don't pay for workers' health insurance. 24 percent of the county's residents have no coverage at all. Dr. George Flores is county health officer.

DR. GEORGE FLORES, County Health Officer: We know that eight out of ten people who don't have health insurance are themselves in the work force. They're working people, or they're family members. And they're working in businesses that may be restaurants or they might be in the service industry, in hotels, they might be in small farms, and they have trouble meeting the high cost of health insurance, and especially because those costs are going up and up and up. I've spoken to business owners, themselves, who have trouble affording insurance for themselves and their family members even.

MS. FARNSWORTH: Doctors Shelby Rush and John Dervin are part of a family practice that treats many of the county's uninsured at the Santa Rosa Community Hospital.

DR. JOHN DERVIN: [talking to patient] What insurance do you have?

PATIENT: I don't have any.

DR. JOHN DERVIN: No health insurance?

PATIENT: No.

MS. FARNSWORTH: This man, who owns a small ice delivery company, had broken his wrist. He has no health insurance, but the doctors will treat him, and the hospital will try to collect what it can. About 20 percent of the patients who come here can't pay, which puts the hospital in continual financial crisis.

DR. JOHN DERVIN: I think Proposition 186 addresses the important issues. It addresses the issues of the uninsured person, but what it really does is it resets the whole stage of health care in California, and it asks us to all agree that we're all in this together, that we're going to be working for the same pool of resources, and we're not going to be, can I get mine, can I get out of it what I need, but say we're all in this together, and that's a fundamental change.

MS. FARNSWORTH: Doctors Dervin and Rush are among a growing number of California physicians in favor of a single-payer system. But the California Medical Association officially opposes Prop. 186.

DR. MICHAEL BURMAN TO PREGNANT PATIENT: [performing sonogram] Perfect. The baby's making breathing movements, if you can see the tummy moving in and out.

PREGNANT WOMAN: Yeah, I can.

MS. FARNSWORTH: Dr. Michael Burman is strongly opposed to Prop. 186. He's a Canadian who moved to Sacramento from Quebec five years ago partly because he disliked the single-payer system there.

DR. MICHAEL BURMAN: By the end I was furious. I was furious for my patients. I was angry about what was happening. I was fighting politically with every minister of health, so I think it is not only naive, it's amusing that anybody might think that this would be a better way.

AD SPOKESPERSON: 186 will force most of us to give up our private health coverage.

MS. FARNSWORTH: Anti-186 ads are hitting hard on the issue of government control. The campaign has spent about $5 million so far, mostly on ads like these. The National Health Insurance Association of America, a Washington, D.C. lobbying group, has continued $1.5 million to the campaign; Connecticut General Life, $176,00; and the Travelers Insurance Company, $166,000.

PAUL MILNE, Manager, Pro-186 Campaign: From just middle class people in their living rooms, that we could raise $80,000 in one week, more than a hundred parties, and I understand --

MS. FARNSWORTH: The proponents of 186, who work out of a small house in Oakland, have raised about $1.8 million so far. This includes a few large donations from unions, but 2/3 of the money comes from donors giving less than $250 apiece. Campaign chairman Paul Milne.

PAUL MILNE: We say this is basically a democratic question for the people to decide, do they want to be secure in their health care, and that they can make that message clear if they participate and get out and campaign. Already, as of last weekend, we've had 600 house parties, 100 house last week alone, 800 more will happen between now and election day.

MS. FARNSWORTH: With limited funding, the pro-186 campaign is saving its television ads for the days just before the election. But the key message is clear.

PAUL MILNE: Unelected, unaccountable, insurance company czars, the CEO's, are making life and death decisions about the middle class people of California, what will be covered, what won't. They're overruling their doctors about treatment, and they're refusing to cover the things that will make people be able to live a life in dignity and without pain.

DREW ALTMAN: Prop. 186 has become not a debate about single-payer but a debate about big government or insurance companies, whichdo we hate more, but one side has money, and the other side doesn't really have money. Whatever the merits of the case, and there are legitimate arguments on both sides on Prop. 186, whatever the merits of the case, I think this is one that will go the way of he who had the most money to purchase the TV time and the radio time and the print time and will not really be about the merits of Prop. 186.

MS. FARNSWORTH: While the debate continues, the number of Californians uninsured keeps growing. In the state as a whole, 22 percent are now without coverage. This compares to the national average of 17 percent. Even if Proposition 186 loses, the drive for health care reform in California is not likely to end. PERSONA NON GRATA?

MR. LEHRER: The other big issue on the California ballot is immigration. Proposition 187 would deny public education and social service to illegal immigrants. Jeffrey Kaye of public station KCET-Los Angeles reports.

MR. KAYE: There are an estimated one and a half million illegal immigrants in California. Their impact on the economy is a matter of contentious debate. While there is general agreement on the costs of providing social services, what is unclear is the contribution and productivity and taxes made by illegal immigrants, who cross the border primarily for low-paying jobs. Prop. 187 advocates contend the measure would save California some $5 billion a year in taxes.

HOWARD EZELL, Proposition 187 Proponent: This is a little bumper sticker that --

MR. KAYE: Proponents of California's Proposition 187 have dramatically entitled it "Save Our State."

HOWARD EZELL: But it says it real clear: Save Our State. No Funding Illegals.

MR. KAYE: The measure would exclude illegal immigrants from public social services, public non-emergency health care, and public schools and colleges. It would make it a felony to manufacture, distribute, or use false citizenship or residency documents, and it would require school and public officials to report persons reasonably suspected of being illegal aliens to the U.S. Immigration & Naturalization Service, the INS. The measure was co-authored by Howard Ezell, a veteran of the long-running political war against illegal immigration.

HOWARD EZELL: The question that every Californian has to ask between now and November the 8th is: How many can you educate, how many can you incarcerate, how many can you medicate, and how many can you compensate in California for these illegals of the world?

MR. KAYE: But opponents contend the issue is not merely a financial one, that there would be troubling social consequences if the measure passes. They argue that the proposition would create a vast underclass cut off from public health care and education. Three to four hundred thousand California students are either illegal immigrants, themselves, or are the children of illegal immigrants. The cost of educating them is more than $1 billion a year. Teachers groups are the largest financial backers of the opposition campaign. In public debate, educators such as Sherry Loufbourrow say they are troubled by the prospects of mass expulsions of students from the public schools.

SHERRY LOUFBOURROW: That's 300,000 children in the state of California who would be turned out onto our streets.

MR. KAYE: Not true says former INS official William King, a Prop. 187 proponent.

WILLIAM KING: The rhetoric that I hear and see in the papers about children being thrown out of school, forming gangs, making our streets unsafe is just that, it's rhetoric. I don't expect to see any child thrown out of school, because the minute this bill passes, and it will, there will be legal challenges all the way up to the Supreme Court, and that's exactly what we want to see.

MR. KAYE: In fact, the education provision of Prop. 187 is guaranteed to end up in the high courts. That's because a 1982 U.S. Supreme Court decision assures a public education for all children living in the country. As for public health care, illegal immigrants and their children are estimated to cost the state more than $400 million a year. But Prop. 187 opponents argue there will be severe costs in denying illegal immigrants health care.

DR. ROBERT T. MINER: If this passes, the ill people will not go to the hospital. Why? They'll be deported.

MR. KAYE: Physician Robert Miner argues depriving one segment of the population health care could imperil another.

DR. ROBERT T. MINER: In medicine we have a saying that says, "Prima nolo sera," "Above all, do no harm." If you don't allow me to treat the illegal alien who's got tuberculosis in the emergency room, I'm going to be treating your family in your home because it's going to get completely out of control.

RONALD PRINCE, Proposition 187 Proponent: We don't think so.

MR. KAYE: Ronald Prince, a Proposition 187 proponent, feels the health care system is already out of control.

RONALD PRINCE: Disease is spreading now. And since we are not able, apparently, to control illegal aliens crossing our borders and bringing those diseases with them, we feel that we need more activity on not only the part of the state to detect illegal aliens by asking for identification from them but also to pressure the government to help enforce the border. The only way we can do that in California is to pass an initiative that sends a message.

[PERSON SPEAKING SPANISH TO GROUP]

MR. KAYE: Opponents contend the measure is racist, particularly the provision requiring suspected illegal immigrants be reported to the INS.

JUAN JOSE GUTIERREZ, Proposition 187 Opponent: So the question there becomes who could be suspected? I mean, who's going to be suspected?

MR. KAYE: Prop. 187 opponent Juan Jose Gutierrez directs the One- Stop Immigration and Educational Center. He was an organizer of an anti-Prop. 187 demonstration in Los Angeles that drew an estimated 70,000 people. He feels the proposition would make suspects of all Latinos.

JUAN JOSE GUTIERREZ: It's probably going to be someone that looks like me, that speaks like me in the best of cases with an accent, someone that dresses probably not like me in most situations but in the stereotype of what a Latino looks like. And so that means the Latino community at large.

HOWARD EZELL: It's baloney. It has nothing to do with being Latino, or being brown or green or pink. It has everything to do with whether or not you're legally here. And to bring in race into this thing is the cheap shot that people want to do to try to derail it. It has nothing to do with race. You look at the polls, 52 percent of those that have some Latino ancestry are in favor of this.

MR. KAYE: The measure's proponents adamantly deny allegations of racism. Yet, at this debate on the measure, one prominent advocate, Barbara Coe, sent up decidedly mixed signals.

BARBARA COE: I want to get totally off of the subject of racism. In the state of California, we happen to have an over amount of people of Hispanic heritage.

WOMAN: I never knew that we had an over-amount of any culture or nationality where people came from into this country; that, that constantly boggles my mind.

MR. KAYE: The charged issue of race is not only a factor in the debate over the measure. Racial politics have also permeated the opposition campaign. Latino groups emphasizing civil rights and ethnic pride have organized vocal demonstrations against the measure. Another, better-financed coalition, Taxpayers Against 187, is directing its campaign towards whites. To run the campaign, the coalition of educators, medical people, law enforcement officials, and unions has hired the political consulting firm of Woodward & McDowell, headquartered near San Francisco. The non-partisan firm specializes in ballot measures. Partner Dick Woodward is a Republican who is straightforward about his firm's target audience.

DICK WOODWARD, Woodward & McDowell: We're trying to reach the great middle class voter in this state. The voting public in California is approximately 80 percent white and the rest minority, so clearly the numbers indicate that we have to go out and reach the white majority.

AD SPOKESMAN: Vote "no" on 187.

MR. KAYE: The Woodward-McDowell strategy reflected in this radio commercial stresses the measure's possible financial ramifications.

AD SPOKESMAN: It violates federal laws and could cost California 15 billion dollars in lost federal funding. The PTA opposes 187 because it would cost schools more than it could ever save them.

MR. KAYE: The commercial refers to a study of the proposition by a state analyst. The analyst noted federal laws require that school and health records be kept private, while Prop. 187 mandates confidential information be released. The conflict could jeopardize federal funds, according to the study. Howard Ezell disagrees.

HOWARD EZELL: Do you really think that the largest state in the union with some 52 electoral votes that Bill Clinton is going to take a dime out of California between now and '96? I don't think so.

MR. KAYE: The Clinton administration in recognition of the frustration over illegal immigration has beefed up patrols at the border. With California's economic recovery lagging behind much of the rest of the nation, both sides with the Prop. 187 debate consider illegal immigration a problem. Even if the proposition wins, and its staunchest opponents concede that is likely, pressure is building for even tighter controls at the border.

MR. LEHRER: Proposition 187 is an issue in the race for California governor. Democratic challenger Kathleen Brown opposes it; Republican Governor, and the incumbent, Pete Wilson supports it. Today two leading conservative Republicans parted company with Wilson. Former Housing Secretary Jack Kemp and former Education Secretary William Bennett announced their opposition. In a statement they claimed Prop. 187 might encourage discrimination. FOCUS - ALL HOOKED UP?

MR. MAC NEIL: Finally tonight, a beginner's tour of the Internet, the global computer network that's become second nature to some but remains a mystery to many more. Our guide is Time Magazine's technology editor, Philip Elmer-Dewitt.

PHILIP ELMER-DEWITT, Time Magazine: The world in the 1960's was described as a global village linked by television technology. Now, three decades later, there's a new kind of global village, this one linked by a computer network called "The Internet." The Internet is actually a collection of tens of thousands of smaller computer networks stitched together to form one vast, seamless worldwide computing machine. Until quite recently, the only way to get on The Internet was through powerful computers owned by universities or government research labs. And the scientists and academics there were the only ones allowed to use it. But in the past few years, dozens of companies have sprung up that will provide Internet access to ordinary computer using citizens and even the large on- line information services like Prodigy, Compuserve, and America Online are starting to allow partial access to The Internet to their subscribers. According to Vinton Cerf, president of The Internet's society, a total of 25 million people are plugged into the network, and that number has been doubling every year.

VINTON CERF, President, Internet Society: Internet is simply the world's largest computer network. It consists of a collection of over 30,000 networks in 74 countries around the world hooked together, 2 1/2 million computers all on one common network.

PHILIP ELMER-DEWITT: All you need to get on The Internet these days is a personal computer, phone line, a modem that allows computers to talk to each other over that phone line, and the right software. A new program called Mosaic makes navigating The Internet as easy as this: You point at a word, click on it, and it takes you somewhere, in this case to the World Wide Web in Switzerland. Mosaic was designed by Marc Andreesen in the hopes that everyone could use The Internet.

MARC ANDREESEN, Software Designer: I think in five years The Internet will be almost everywhere, The Internet will be on every desktop, will be in every home, will be on every palmtop computer that people carry with them, no matter what it's like. It will be traveling the air; it'll be traveling over the new high-band width networks that are being constructed, and it will just be a standard facet of life. People will use it to communicate with one another, to shop, to entertain themselves, to access information that they need in their daily lives.

PHILIP ELMER-DEWITT: Right now, the most popular use of The Internet is to send electronic messages or E-Mail back and forth. But there's much more to The Internet. Using programs like Mosaic, Gopher, and Anarchie, you can more The Internet searching for whatever catches your eye. You can hook up to almost any computer in the world if you know its Internet address. This one takes you to the Library of Congress. Once on The Internet, you can do research into almost any subject, from aeronautics to economics. You can download images of every description, like the latest satellite photos from NASA, or tour digitized collections of fine art. In thousands of discussion groups called usenet news group you can talk about great works of literature, or have arguments called plane wars on issues like controlling nuclear weapons or controlling handguns. You can play games with opponents across continents. You can keep up with your latest fave, like the Cyberspace Deadhead found in the Grateful Dead, or devotees of grunge music checking out the latest on Pearl Jam. [Pearl Jam Segment] You can get useful medical information about orthopedics, for instance. And you can share your hobbies with other enthusiasts, whether you're into birding, or boating, or bugling. You can let others know how you feel about current social issues, or let the President of the United States know how you feel about anything at all.

BILL CLINTON: Preserve, protect, and defend the Constitution of the United States --

SPOKESMAN: So help me God.

BILL CLINTON: So help me God.

PHILIP ELMER-DEWITT: The marvel of this complicated technology brings with it some simple human dilemmas that the computer world is trying to sort out. The most pressing is the question of access. Some people fear that the network's complexity and the cost of the technology needed to get to it will contribute to the rise of an information elite. Marcy Montgomery of the RAIN Network.

MARCY MONTGOMERY, RAIN Network: -- but it is true that there is great disparity between the haves and the have nots with The Internet, and it's important that grassroots organizations like RAIN spring up at a reasonable level and make this technology publicly available.

PHILIP ELMER-DEWITT: The RAIN Network provides low-cost Internet accounts and some free public access to the residents of Santa Barbara, California, hoping to bring all of the community together, families, schools, and businesses. But co-founder Timothy Tyndall still hears some grumbling from Internet veterans about the flood of new users coming on-line.

TIMOTHY TYNDALL, RAIN Network: There still is a tremendous amount of resistance to it and a certain chauvinism that regular people simply don't need technology of that level. We've learned through the experience with the network that regular people make enormous use of that technology, and that technology is transforming our communities very much the way the free public library system transformed communities when those were established.

PHILIP ELMER-DEWITT: Some of The Internet's leading citizens see it as an opportunity to create new kinds of virtual communities, like author Howard Rheingold.

HOWARD RHEINGOLD, Author: We now have an opportunity for every person to be a publisher, every desktop to be a broadcasting station. That's very exciting, very democratizing. It's not something that a big corporation or a big government is designing. It's something that is really truly growing from the grassroots.

PHILIP ELMER-DEWITT: Others see The Internet as a business opportunity, a fertile ground for advertising, a place to get rich quick. Publisher Alan Meckler organized this recent Internet trade show.

ALAN MECKLER, Publisher: This is like being in the Wild West or being in the Klondike or something. The opportunities for me and for people here are enormous. And it hasn't even begun. Every day we're seeing new applications, people announcing new services. What the bottom line on those are right now we don't know. But obviously, you wouldn't be getting the likes of Dow Jones, Dun & Bradstreet, Ogilvie & Mather, just to name a few, if they didn't think they were going potentially to make a lot of money in this area.

PHILIP ELMER-DEWITT: But traditional, in-your-face hard sell advertising doesn't seem to work on The Internet. Steve Case is president of American Online.

STEVE CASE, America Online: Advertising per se is probably the wrong model because the presumption of advertising is, it is intrusive, and people don't want it to be intrusive in this new medium. They want it to be something that's more self-selected.

PHILIP ELMER-DEWITT: What does seem to work on The Internet are places that can choose to go, like the Meckler Web, when they want information on a product. O'Reilly's Global Network Navigator pioneered the use of advertising that appears only when the user wants to see it.

TIM O'REILLY, Publisher: And that changes the nature of advertising from grabbing somebody's attention to providing useful information. And that's what The Internet has always been about.

PHILIP ELMER-DEWITT: Finally, there is the question of who gets to say what in cyberspace. Right now, discussions on The Internet can get pretty raucous. It seems to be a libertarian paradise, tolerating just about anything. Lawyer Daniel Appelman.

DANIEL APPELMAN, Lawyer: The Internet was founded, among other things, on a principle of free speech and free expression. And I think that continues with a lot of the people who have grown up using The Internet. So outrageous opinions, expressions and thoughts that would offend others were deemed to be acceptable on The Internet because they weren't imposed upon other people.

PHILIP ELMER-DEWITT: Doug Humphrey runs a company that provides Internet access. He says people on the network can be as offensive as they are any other place.

DOUG HUMPHREY, Digital Express Group: There will be rude and boorish people everywhere you go, even on The Internet. There will be bigots and people with racial and sexual bias and who state those facts, those, those positions in public, and those people will be on The Internet as well.

PHILIP ELMER-DEWITT: Also on The Internet is a lot of sexual material, some of it quite explicit, raising the question of whether some form of censorship will eventually be imposed.

STEVE CASE: Some who do believe in the model of anything goes, anybody can post anything about anything and the other model is, is more of a publishing model, is you're really going to tightly edit it and tightly control it and people can only talk about certain things in certain ways. We think both of those are too extreme, and that the right way to do it is something in the middle.

PHILIP ELMER-DEWITT: Because The Internet is a cooperative venture, it is largely self-policed. Nobody owns it; nobody runs it; and nobody can pull the plug. John Whalen, another Internet provider.

JOHN WHALEN, Internet: It's extraordinarily difficult for a government agency or for anyone, for that matter, a non- governmental agency, to take upon itself the responsibility of policing an amorphous entity like The Internet.

PHILIP ELMER-DEWITT: According to Howard Rheingold, Internet belongs to everybody.

HOWARD RHEINGOLD: The real story is not about individuals; it's about a lot of people cooperating. And what's exciting about it is you don't have to be a professor at Harvard or the CEO of General Motors. You can come from a university in New Zealand or a little BBS in Wyoming, and if you've got something interesting to say, or to show or to add to the resources, then you could be an Internet citizen too.

PHILIP ELMER-DEWITT: It's a new world that's being colonized at a remarkable pace, and the pioneers settling it are still working out its rules and customs. To watch the process unfold and have a say in its outcome, you only have to plug in your modem and log on. RECAP

MR. MAC NEIL: Again, the main stories of this Wednesday, a bomb exploded on a bus in Tel Aviv, Israel, killing 22 and injuring more than 40. The Islamic militant group Hamas claimed responsibility for the attack. Israeli and Palestinian officials pledged to continue the peace process. Floodwaters began to recede in the Houston, Texas, area. Late this evening, the White House announced it will comply with a subpoena issued by the special counsel investigating outgoing Agriculture Secretary Mike Espy. And singer and comedienne Martha Raye died in Los Angeles. She was 78. Good night, Jim.

MR. LEHRER: Good night, Robin. We'll see you tomorrow night. I'm Jim Lehrer. Thank you, and good night.