The MacNeil/Lehrer NewsHour

Intro

JIM LEHRER: Good evening. In the news this Thursday, Republican conservatives pushed for an ironclad ban against tax increases in the party's platform. Iraqi warplanes attacked a huge oil platform off the Persian Gulf coast of Iron. Soviet minesweepers and others joined the international effort to clean the Red Sea of mines. And President Reagan termed emergency military aid for El Salvador "vitally urgent." Robin?

ROBERT MacNEIL: Leading our NewsHour tonight, we discuss taxes, deficits and the performance of the economy in an extended interview with Treasury Secretary Donald Regan. On the 10th anniversary of President Nixon's resignation, we hear what thoughts that evokes among people in Abilence, Kansas. The U.S. ambassador to El Salvador and a leading administration critic debate the administration's new evidence on how arms reach the guerrillas. We profile Olympic high jumper Dwight Stones and the effort of competing at the age of 30. And on our Route 89 series, we meet a very different sports star: a 12-year-old girl baseball pitcher in Tucson, Arizona.

LEHRER: Walter Mondale campaigned in Alabama and South Carolina today and then went home to Minnesota for the night and probably for a good laugh, delighted at the tizzy he has thrown the Republican opposition into with his now immortal words, "Mr. Reagan will raise taxes and so will I. He won't tell you; I just did." They're from Mondale's convention acceptance speech, of course, and the internal Republican tizzy about them continued unabated today. First a group of conservative House members held news conference to ask that the GOP platform take a firm pledge against a tax increase.

Rep. VIN WEBER, (R) Minnesota: The focus of our efforts in the next couple of weeks is going to be to assure that the Republican platform in Dallas has an ironclad plank against tax increases. We think we have an excellent opportunity within the platform committee to win that fight, and if not, we're exploring what may have to happen in order to take that pledge to the floor of the convention, where I'm equally confident that we can win.

REP. NEWT GRINGRICH, (R) Georgia: The question is, in the summer of 1984, is the basic policy thrust of the Reagan Republican Party effort to be sort of Mondalesque or very different. Mondale is saying all of us will raise taxes, it's a question of how much and on who. We're saying no.

LEHRER: Then later there was a news conference by Congressman Trent Lott, the Republican minority whip of the House and chairman of the Republican platform drafting committee. He said there could be a problem over language.

Rep. TRENT LOTT, (R) Missouri: We are opposed to tax increases, but it's -- nothing is in cement, and we are still working with all parties. I think we're very close to having language that we can agree on, and I mean all the various people that have expressed an opinion. The language will be clear, but I'm not going to say that - try to give you every word now, because a word can make a lot of difference and we may make some changes. But again, we have worked with Drew Lewis and the administration and all of the people, including Newt Gingrich and Jack Kemp and Bob Dole. And I think we're pretty close to having -- I'd say about 99% agreement on what we will have.

LEHRER: All of this makes for happy Democrats, none more so than Mondale's running mate, Geraldine Ferraro, who today got in a few licks about taxes herself.

Rep. GERALDINE FERRARO, Democratic vice presidential condidate: No one wants to raise taxes, but the fact is those taxes are going to be raised, and what you're finding -- what you're seeing happen is that Walter Mondale is telling where those taxes and how those taxes will be raised, but the administration is dancing all over the place, saying perhaps it will, perhaps it won't. Reagan and Bush are engaging in a debate, and I've asked for a debate with George Bush, you know? And it's -- to watch the two of them at the issue is rather -- well, it's a little bit upsetting. Donald Regan: On the Spot

MacNEIL: Ever since Mondale's tax pledge, President Reagan and other administration officials have been denying that they have any plans to raise taxes in 1985. But the press continues to detect a little hedging. The most categorical statement so far has come from Treasury Secretary Donald Regan. He told Congress yesterday all talk of a tax increase was untrue and unfounded. Secretary Regan is with us tonight to discusses taxes and the state of the economy.

Mr. Secretary, welcome. Do you think that putting an ironclad plank in the GOP platform, no tax increase, is a good idea?

Sec. DONALD REGAN: Well, I think that's one way of expressing it. I had thought the President and I also yesterday had said this very clearly: there are no secret plans for tax increases in 1985. Now, if you want me to go on and say are there any hidden plans for tax increases in '86, the answer is no; '87, no; '88, no. So we have no plans for any kind of a tax increase.

MacNEIL: Well, saying you have no plan is not the same thing as saying no tax increase next year, is it?

Sec. REGAN: Well, I would think so. I mean after all, we have our ideas now on what 1985 is going to shape up with, and we don't plan to raise taxes in 1985.

MacNEIL: Is that the same as saying there will be no tax increase in 1985 if we are reelected?

Sec. REGAN: That's what the President has said. He said that he would veto any tax increases in 1985.

MacNEIL: I'm not just playing with words here. I guess every word, as we just heard Mr. Lott say, is important. Are you saying we have no plan now, we could have a plan later?

Sec. REGAN: I don't think we dissemble that much, not nearly as much as, let's say, the other candidate, who while he accuses us of having a secret plan, hasn't opted to show us his yet. I wonder where his is. Is his going to remain a secret also?

MacNEIL: Well, that leads me to ask, is yours -- you said "a secret also."

Sec. REGAN: Well, now, I guess I'm going to have to watch every single word here. I'm glad I majored in English so that I at least understand what this debate is all about -- it's little words. Let's say that we have no secret plan. Does he?

MacNEIL: Well, let's just go back over the record a little bit. At his last press conference, President Regan, while saying there are no plans for a tax increase, indicated that a tax increase might be necessary if Congress refused to cut the budget enough to reduce the deficit to satisfy him. Now, what if those spending cuts are not forthcoming from the Congress?

Sec. REGAN: Well, first of all, I think a little-known fact in this whole silly debate has been whether or not revenues will increase or decrease next year. Few people realize that revenues will increase next year on the order of $70 to $90 billion if we do nothing about the tax code, just leave it alone -- we'll get $70 to $90 billion in '85 over '84. Same thing at '86 over '85 and the like. So much so that by the time we get out to 1989, five years from now, we will have $400 billion more in revenue than we have now. Now, what the Democrats are saying -- that isn't enough, we need more, so we're going to raise taxes to get more than $400 billion out there. What we're saying is, look, we're going to have this kind of revenue; the trick is not to spend it all. Spend 300 of it -- you reduce the deficit by $100 billion. That's the path that we're on.

MacNEIL: But in this next year, 1985, you just said revenues would be -- I think you said $90 billion more.

Sec. REGAN: Eighty to 90.

MacNEIL: Eighty to 90 more. Well, is that how you foresee reducing the deficit, by that additional$80 to $90 billion?

Sec. REGAN: Not by that entire amount, because federal spending will go up next year. This year federal spending is up about 7 1/2% over '83. Next year it's scheduled up about the same amount. What we would like to see is not have it go up that much next year, have it go up three or four percent next year.

MacNEIL: By how much do you think the deficit could be reduced next year from these added revenues?

Sec. REGAN: My guess is that it could be $20 to $25 billion of a reduction from what it is in this year.

MacNEIL: I see. And would that be considered a satisfactory reduction to the administration?

Sec. REGAN: Well, at that point the deficit would be somewhere in the $150, $160 range and on the downward path. And that's exactly what Wall Street is looking for in order to get interest rates down.

MacNEIL: So you would think that kind of reduction would be enough without a need to cut spending more or raise more revenue?

Sec. REGAN: That's exactly what we're saying.

MacNEIL: Which is what gives you confidence to be so categorical about no tax increase next year?

Sec. REGAN: Exactly. You see, what we're depending upon is growth in the economy. And we noticed what the growth has been this year; we're going to see more growth next year. There's where we're getting our added revenue. And we're not doing away with indexing of taxes.

MacNEIL: A couple of months ago, on May 22nd, to be exact, both The Washington Post and The Wall Street Journal quote you as telling a meeting of tax experts, "Don't be surprised if there would be two tax bills in this area, one just to raise revenue in order to get the deficit down, because we must do more on the deficit next year, and at the same time work could be started on tax simplification." Now, has your thinking changed since you made that statement?

Sec. REGAN: Well, what I meant by that statement, and I'll stick by it now -- we will have a tax simplification plan of some sort next year. We're working on that now in Treasury. At the same time, we're going to have to have a revenue bill just to authorize the necessary gathering of revenue by the IRS and the like. So there's where the difference will be.

MacNEIL: But since May 22nd you no longer think a revenue bill will be necessary to reduce the deficit?

Sec. REGAN: No, I don't, because since May, we've had this glorious second quarter as far as growth is concerned in our economy, and the strength of the economy indicating that it's going to stay even -- it's going to be larger than we thought it was at that time.

MacNEIL: What about a number of leading Republicans like Senator Dole, who continue to think that some added revenue will be necessary to fight the deficit, to reduce the deficit? You in the administration disagree with those Republicans on the Hill?

Sec. REGAN: Well, I think they despair of getting the Democrats on the Hill to join them in cutting spending. We on the other hand believe that the American public are going to insist upon cutting this federal spending rather than raising taxes on them.

MacNEIL: I see. Hasn't in fact Mr. Mondale painted you into an awkward political corner in this whole area?

Sec. REGAN: Oh, on the contrary, Robin, I think he's painted himself into the worst of all corners. He now has to tell the American public where he's going to raise taxes, how much extra it's going to charge. According to our figures it's going to cost each family member at least $1,500 in additional taxes to elect Walter Mondale. I think that's the worst of all boxes for him.

MacNEIL: How do you calculate that?

Sec. REGAN: Well, he said that he wants to reduce this deficit by two-thirds next year. According to the Congressional Budget Office that would be somewhere in the neighborhood of $135 billion of reduction. Now, he hasn't agreed to cut spending. In fact, he wants to raise spending. So if he's going to do this solely on taxes, there are 92 million American families. Divide 92 into 135 and it comes out around to 1,500 for each family member.

MacNEIL: But I'm wondering about the political situation your party finds itself in on this, that in the job you have at the moment, surely experience and prudence would make you want to leave your options open just a little bit, whereas politics demands no options.

Sec. REGAN: Look, we're going to let Reagan be Reagan, and Reagan is a tax cutter, not a tax raiser. And he, if anything, would like to see taxes cut next year. I don't think that's possible, but if it were, he'd certainly be in there pitching for it.

MacNEIL: Except that on a couple of previous -- many previous occasions he has spoken out against tax increases, but in the last two years he has signed bills providing for increased taxes.

Sec. REGAN: Yes, and you know why, because what had happened was, the deficit grew at an alarming rate as a result of the deficit -- as a result of the recession that we inherited from the Carter-Mondale administration.

MacNEIL: All right. Thank you. Jim?

LEHRER: Mr. Secretary, why did you a while ago tell Robin that this was a silly debate over taxes and deficits?

Sec. REGAN: Because I think it's bringing the press to where they're pressing us Republicans to be very precise at every word that we say, and they're hounding us, literally, looking as to "Did you mean this when you said not?" Even poor Robin said -- picked me up on the word also. I mean when one starts to get that picayune, I think it's rather silly.

LEHRER: But you're not suggesting that -- here I'm going to hound you a minute if you don't mind, a minute more -- you're not suggesting that this is not a legitimate concern for the voters to decide in November who's going to raise taxes, who isn't going to raise taxes, who's going to cut the deficit, who isn't going to cut deficits and that, etcetera, etcetera, etcetera?

Sec. REGAN: Oh, this is a very important debate from that point of view, Jim. You've got to remember that actually the choices are now to vote for them and raise taxes, vote for us and you don't get a tax raise.

LEHRER: That's what you say the choice is?

Sec. REGAN: Certainly.

LEHRER: Okay. In addition to denying there was going to be a tax increase next year yesterday, you also did some economic forecasting. Let's go through that, a couple of those items. Unemployment -- it went up last month from 7.1 to 7.5, but you said yesterday it's going to go down. Why?

Sec. REGAN: Well, first of all, business is very good, and business formations are still going up. So as a result, there'll be more firms hiring more people. That statistic in July of the unemployment is some type of aberration. Either June or July, there's something wrong with it. And Commissioner Norwood, when she was before the Congress last week, explained that, that there's a statistical fluke in those figures. So we're looking May to July, and that's about a 7 1/2, and I think from 7 1/2 we can bring unemployment down to below 7 by the end of the year.

LEHRER: Six point eight, I think is what your official forecast was.

Sec. REGAN: Yeah, yeah.

LEHRER: Now, on interest rates, you said yesterday they're going to stay high for a while. Why is that?

Sec. REGAN: Well, if you don't mind my saying, we've had a marvelous rally in the bond market today. The long end of the market now is down over 150 basis points, a point and a half in the last six weeks.

LEHRER: Now, you're going to explain why that's important.

Sec. REGAN: Well, it's important because interest rates are coming down. The long Treasury bond six weeks ago was selling almost at 14%. Tonight it's selling below 12 1/2%. It's that low.It's come down quite a bit. The short end of the market has not started as yet to come down, but we think it will. So although our projection for interest rates is higher than we had it in April, it'll still be coming down from where it was over the next six months.

LEHRER: Your friend Paul Volcker, who runs the Federal Reserve, yesterday said again that it's high federal deficits that cause high interest rates. Do you still disagree with him?

Sec. REGAN: Certainly on that particular point. On some other things I do agree with him, but on that particular point the evidence is very sketchy as to the connection between the two.

LEHRER: What do you mean sketchy?

Sec. REGAN: Well, we've asked repeatedly for people to give us papers, learned papers on this subject. I have yet to receive my first one that bears any kind of scrutiny. But there is a lot of evidence coming in from scholars on the other side when they examine the facts.

LEHRER: Well, scholars aside, your former colleagues on Wall Street certainly relate the two, do they not?

Sec. REGAN: Well, they relate the two, yes. But Wall Street could be wrong in its analysis, although one could be penalized if one goes against the market in describing that. But incidentally the market went up again today -- again an interest rate play, that the market finally is believing --

LEHRER: Interest rate play, meaning?

Sec. REGAN: Well, meaning that the stock market has finally agreed that we have low inflation and that is the key to interest rates. If you keep inflation low, you'll get lower rates of interest. That's what we've been saying all the way along.

LEHRER: Is that your interpretation of the volatility of the stock market lately?

Sec. REGAN: Yes.

LEHRER: You know, way up and then way down -- not way down, but then back down.

Sec. REGAN: They have been watching interest rates, and as interest rates rose during the spring and the like, it killed that earlier rally in the stock market. Now that interest rates seem to be coming down again, the rally has once again started.

LEHRER: Another factor that was at least mentioned when we did a story on this earlier in the week, that bad news, meaning an increase in unemployment, is seen as good news on Wall Street.Is that part of it too?

Sec. REGAN: Well, I think that can be translated to mean that they think the economy is slowing down from its torrid pace of the first and second quarters of this year. And I think that is a fact, that the economy's rate of growth will slow down. The economy itself is not going to be negative but will be slowing its rate of growth.

LEHRER: From the administration's point of view, are you willing to trade off a little higher unemployment if it will hold, if it will convince the stock market that things are going to be all right on inflation?

Sec. REGAN: We don't have to make that trade. We have what every other industrialized nation in the world would like to have: solid growth accompanied by low inflation and putting people back to work. And that's exactly what this economy is doing and will continue to do over the next 12 months.

LEHRER: If so, then, why would the Census Bureau report last week as it did that the poverty rate in this country is higher now than it's ever been before and is going up?

Sec. REGAN: Well, you've got to remember, they were looking, focusing primarily on 1982, and 1982 statistics. Since then we've had quite --

LEHRER: Actually it was 1983 I believe.

Sec. REGAN: Well, 1983 statistics. But since then, in 1984, we've had quite a comeback in employment. Over two million of us have jobs now that didn't have jobs earlier in the year. I think were the statistics to be taken again right now, things would look a lot better.

LEHRER: Speaker O'Neill says that that is the smoking gun of Reagan economics.

Sec. REGAN: Well, we don't believe that, because we've brought their inflation down. Inflation is the cruelest of all things to inflict on the poor, to take away their money because it doesn't have value. We've added value to their money, and so far from being cruel to them, I think we've tried to be helpful to them.

LEHRER: You don't find it a difficult argument to make that economic recovery is going great yet the poverty rate is going up and unemployment is going up?

Sec. REGAN: Well, unemployment only went up one month.

LEHRER: Okay.

Sec. REGAN: On employment since November, we've added close to seven million jobs -- November of '82. Now, I think we'll continue that pattern.

LEHRER: For -- I mean, forever?

Sec. REGAN: Well, no. Over the next 12 months. After 12 months my crystal ball gets a little cloudy.

LEHRER: All the reports said that you were opposed to the FDIC bailout of the Continental Bank of Illinois. Why?

Sec. REGAN: Well, I agreed with the ultimate objective, which was to save the bank, not to save the stockholders, not to save the bondholders, not to save the management and not to save the board of directors. But I didn't like the way it was done. The FDIC, which is an insurance agency -- no taxpayer money involved here, by the way; I hope you understand that -- but nevertheless, the insurance money from the FDIC is now subordinate to, or junior to, the bondholders of the holding company. I don't think that's where the insurance companies should be. I think they should be senior to the bondholders.

LEHRER: Do you agree with critics who say it sends the following message, that if you're big enough and you foul it up bad enough and you get big enough in debt, the federal government will rescue you?

Sec. REGAN: No, I don't believe that at all.

LEHRER: What is the message then?

Sec. REGAN: Well, the message there is, why close the biggest bank in the Midwest? Over 2,000 other banks, smaller banks throughout the Midwest and the Southwest, had -- were in joint loans with that bank, were loaning them Fed funds. Why close that with all the tremors it would make? The Midwest has had a bad enough time coming out of this recession without adding to its misery. That's the message of why we kept Continental open. Now, each one of these banks will be handled on a case-by-case basis. We're not going to say that all banks will be rescued or all banks will fail.

LEHRER: Mr. Secretary, would you be interested in remaining secretary of the treasury in a second Reagan administration?

Sec. REGAN: Well, I'll tell you a little secret. My goal is to get by December 1st, when I'm due to give this tax simplification plan to the President. After that I'll draw a deep breath and see where Iam.

LEHRER: Mr. Secretary, thank you. Robin?

MacNEIL: As the secretary indicated, on Wall Street the stock market was up sharply again today in a mood of optimism prompted by lower interest rates on long-term government bonds. The Dow Jones average of 30 industrial stocks was up 27.94, closing at 1224.05.The volume was heavy with more than 130 million shares changing hands.

Legislation designed to give women equal pension rights with men received final congressional approval today. The House of Representatives passed the measure on a voice vote and it now goes to President Reagan for signature.Representative Geraldine Ferraro, the Democratic vice presidential nominee, who first introduced the bill in 1981, commented, "This is a great day for American women and a great day for every American who's working to provide old-age security for him or her self and their family." The bill would expand the pension coverage for workers who leave jobs to have babies or raise families and then return to work. It would also guarantee pension rights of homemakers whose working spouses die before, retirement.

On the Senate side of Congress, the ethics committee announced it had started a review of a $40,000 payment by a Greek entrepreneur to the wife of Republican Senator Mark Hatfield of Oregon. The Associated Press said the FBI was also seeking to investigate the matter. The senator has denied published allegations that his wife, who has her own real estate business, received the money as compensation for his support for an oil pipeline across Africa.

Jim? Nixon Resignation -- Ten Years Later

LEHRER: It was 10 years ago today that Richard Nixon left Washington a resigned and disgraced 37th President of the United States. Much has been said and written the last few days about Richard Nixon, how he and his image and his esteem and his place in history are doing now, 10 years later. The words on the subject we present tonight are those of Jim Fisher and some people he talked to in Kansas. Jim is a columnist for the Kansas City Times.

JIM FISHER, Kansas City Times: I'm going to say something you'll hear from few newspaper reporters. I voted for Richard Milhous Nixon three times: 1960, 1968, 1972. And a decade ago, like millions of other Americans, I watched the drama of Watergate unfold with disgust, anger, finally turning away from the whole thing. Yet it's been 10 years, and what do people think now? To find out, I came here to Abilene, Kansas, a small Republican town in central Kansas, to find some answers.

[voice-over] Abilene and Dickinson County are farm country. Wheat and hogs, sorghum and cattle. There's some industry. Abilene was Dwight D. Eisenhower's hometown, and now his presidential library and museum are here. There's a minor Nixon connection: small campaign buttons, a couple of exhibits, some photographs, all at the museum. Politics here are Republican. Nixon took 76% of the vote here in 1972, 68% in 1968, 69% in 1960. Like just about any Kansas town, folks get together for coffee midmornings. Here it's at the Texan Cafe just off A Street, which used to be Texas Street in Wild Bill Hickok's day. You can get an opinion at the Texan, especially about Richard Nixon.

HENRY JAMESON, newspaper editor/publisher: He made some bad mistakes and he lied and everybody was disgusted and teed off and were glad he resigned. But there was never any great deep reaction other than total disgust with the guy.

FISHER: Do you think it was the lying that did Richard Nixon in?

MORT SMITH, former mayor: Right.

FISHER: Because lying still doesn't go out here.

Mr. SMITH: No, lying don't go anywhere. We do it, we do a lot of it, but we don't get caught.

FISHER [voice-over]: So in the Texan you hear words like disgusting and lying. A farmer's wife, Nadine Griffin, put it simply.

NADINE GRIFFIN, farmer's wife: I don't think you can call him a senior statesman. That's the wrong term. I think you can call him a former President. I'd like to save that term senior statesman for someone I had a little bit more respect for at this point in time.

FISHER [voice-over]: Mrs. Griffin is one of the few Democrats around here. Sher remembers a funny story that shows that many people were embarrassed for having voted for Richard Nixon.

Ms. FISHER: In the last Nixon election, presidential election, in that little township there were only two votes cast for Mr. McGovern. And I tell you, after Watergate there were a lot of people claiming them.

FISHER [voice-over]: So it isn't all serious, but people here remember, often painfully.

HENRY JORDAN, veterinarian: We respect our presidents, always have, and I was really disenchanted and it was a low point in my life.

FISHER [voice-over]: Above all, a lot of people share my feeling of disillusionment. When Nixon turned his back on the people of Abilene, he lost more than the presidency and the immense power than went with it. He lost more, something far bigger: he lost America. He lost this. He lost this. And this. He lost a place where people come in cars to band concerts and blow their horns when they like the music. In Abilene they still believe lying is wrong, that you don't juggle your income tax, and "expletive deleted" belongs somewhere else than in the Oval Office. But there may be a compensation for our Watergate trauma -- ethics in government.

Ms. GRIFFIN: I think a politician, when he says "I want to run for public office," puts himself out into the public eye and says to the public, "My life's an open book. You can see everything there is there. I can't hold anything back. That's part of my price I pay for wanting you to support me."

FISHER [voice-over]: Back at the Texan Cafe there was one surprising paradox in the attitudes towards Nixon today. You could listen closely and hear a grudging admiration for the former President, especially in terms of how he could talk to the Russians and how well he dealt with other nations.

RALPH HILTON, print shop owner: I think down the road in a number of years he's going to be remembered as a pretty good statesman, particularly with regard to foreign policy.

Mr. SMITH: He was a good public relations -- international relations man, and we don't -- we need that. We need that in America. We need that all over the world.

FISHER: Do you think Reagan can do it?

Mr. SMITH: I'm a little disappointed in our President in that respect.

FISHER [voice-over]: You wonder down deep, if he was on the ballot this year, how many votes Nixon would get. Maybe the answer came in response to recent stories like this one in USA Today saying Nixon was back, resurrected so to speak.

Mr. JAMESON: Well, I think people are beginning to realize that he wasn't all that bad, but I wouldn't say resurrected. God, I hope not.

MacNEIL: In California, where President Reagan is vacationing at his ranch, his press spokesman, Larry Speakes, was asked if the President had any thoughts on the Nixon anniversary. Speakes said "No thoughts."

Still to come on tonight's NewsHour, the U.S. ambassador to El Salvador and a congressional critic examine the administration's new evidence on arms shipments to the guerrillas. And we meet two star athletes: high jumper Dwight Stones, competing for an Olympic Gold Medal at the age of 30; and in Tucson, Arizona, Heather Stone, 12 years old, star pitcher in Little League baseball.

[Video Postcard -- Salt River Canyon, Arizona]

MacNEIL: In the Persian Gulf, Iraqi warplanes attacked an Iranian oil platform and set it ablaze. It was the second attack in 48 hours after a month-long lull. Iran said the platform, 55 miles southwest of the Kharg Island oil terminal, was only slightly damaged.

Meanwhile, the drama of the mystery mines that have disrupted navigation in the Red Sea widened today. Britain and France agreed to join the United States in searching for the mines, which have damaged 12 ships. The U.S. has sent four minesweeping helicopters to Spain for shipment by aircraft carrier to the Red Sea. A Soviet minesweeper was reported also looking for mines. Egyptian sources said Cairo would provide military escorts for Muslim pilgrims sailing across the Red Sea to holy sites in Saudi Arabia. In Teheran the aging Ayatollah Khomeini made a speech denouncing the mining and criticizing his nation's official radio for praising it.

Jim?

LEHRER: President Reagan said in a written statement today his Central America aid package with $117 million in military aid to El Salvador is vitally urgent. He urged Congress to authorize it without further delay, but since Congress breaks for its summer recess tomorrow, that doesn't leave much time. And the division between the House and Senate on the El Salvador issue is a wide one, the House having passed a version with the special $117 million out, last night the Senate passing one with it in. Judy Woodruff reports on the

Judy?

JUDY WOODRUFF: Jim, a joint House-Senate conference committee is just now sitting down to work to resolve the issue. In preparation for that the administration has pulled out all the stops to help make the case that El Salvador needs extra military aid. The U.S. ambassador to Salvador, Thomas Pickering, and the top U.S. general in Central America, Paul Gorman, have both been up on Capitol Hill trying to persuade legislators that the Salvadoran government is fighting rebels armed by Nicaragua. To back up those contentions, the State Department yesterday released for the first time publicly what it has been talking about for months privately: intelligence films taken at night by planes using night-seeing photographic equipment. As one example, on the night of July 10th, U.S. intelligence agents flying in an AC-130 aircraft photographed a large shrimp boat and two small boats 10 miles off the coast of El Salvador.The videotape and narration of that incident that we will show you now were prepared by the State Department.

NARRATOR [voice-over]: You are now observing the shrimper and the two boats on low-light television. The shrimper, which is 75 feet in length, has a smaller boat in tow. It has its outriggers extended on both sides as if to give the appearance of fishing. It is running with lights on also to avoid suspicion. The two smaller boats, both 18 feet in length, have square-shaped sterns. It is likely that the shrimper had completed a transfer of materiel to the two 18-foot boats just prior to the arrival of Bield Kirk. When the shrimper realized that the Bield Kirk aircraft was overhead, it began to move away from the smaller boats in a southwesterly direction towards open seas. The shrimper quickly attained high speed -- again, not indicative of normal shrimping procedure. For the time being, the two 18-foot boats remained in place. Upon the arrival of the Bield Kirk, the two boats pushed apart and began to move apart toward the Salvadoran coast. The boats quickly attained high speed, estimated at between 20 and 25 knots. On three occasions during the boat's movement toward shore, one of the boats stopped, apparently to check that the Bield Kirk aircraft was still overhead. During one such stop, shown here, a crew member of one boat apparently threw an object overboard. Aircraft crew members saw this activity through their night-vision goggles.

When the boats landed on the beach, they were met by personnel, noted on the screen as hotspots. Of particular note, a crate was apparently off-loaded from one of the boats onto the shore. We have freeze framed the imagery here to better outline the crate, which is just off the bow of the boat in the center of the screen. At this location along the southeastern coast of El Salvador, Bill Kirk image would appear to be the formation of a pack animal train on the beach in the early morning hours of 11 July. After forming up, the personnel at the lead of the formation led the train inland. The larger hotspots you see are probable pack animals. The smaller hotspots are personnel. Notice also that smaller hotspots are leading the larger hotspots as apparently a man would lead a pack animal. Notice also the interval that is maintained by the hotspots leaving the beach at the head of the column.

WOODRUFF: To assess the impact of these intelligence videotapes and to look at the overall aid prospcts for Central America, we turn to the U.S. ambassador to El Salvador, Thomas Pickering, and to a leading critic of administration policy in El Salvador, New York Democratic Congressman Stephen Solarz.

First of all, Mr. Ambassador, I think to the untrained eye, a lot of that film looked like little white blobs and it was kind of hard to make out exactly what it was.Is this the best evidence that the administration has?

Amb. THOMAS PICKERING: No, of course not. At the introduction to the briefing we made clear that no single piece of evidence presented in a 45-minute briefing was conclusive, but that the briefing itself, putting together painstakingly collected bits of information from many sources, perhaps as many as 40 or 50 separate pieces of information, brought together a picture of four incidents of importance in establishing the fact that the smuggling of supplies was taking place into El Salvador. The other important thing to recognize, and it was made clear at the briefing -- perhaps your correspondent missed that -- was that these were pictures taken on a 900-puls line-scan television compared with a 500 scan in which they were shown. Because of technical problems, people don't have that kind of definition. So the crew that identified these in the aircraft had approximately twice or perhaps even more definition possibilities to understand what these things were. In addition, of course, it had long experience in looking at this of material and having it verified on the ground. So obviously nothing relates solely to those fuzzy-definitioned videotapes.

WOODRUFF: So how do you know that what you're saying, the State Department representative was saying these things were, were that were? I mean the crate, the people and whatever the other --

Amb. PICKERING: Because as I made clear, we have pictures taken in the original mode, which is much clearer than the ones we were able to show you, because for technical reasons common television isn't able to reproduce that. Secondly, we've had long experience in checking against what's happening on the ground, what happens in the air, and so we know what men look like from the air, we know what animals look like from the air.

WOODRUFF: All right. Well, let me just ask you briefly, what does it all add up to, what does it prove?

Amb. PICKERING: Well, the total briefing, not just this videotape, which is only part of it, adds up to a great deal of evidence indicating that supplies move to the guerrillas over the beaches, perhaps over land corridors -- I'm certainly convinced myself the land corridors are very important. And we've been able to establish that the Nicaraguans themselves have admitted participation in this activity, and we've established with this kind of material throughout the whole briefing that Nicaragua is a very important point for moving these kinds of arms and equipment to the rebels, the guerrillas in El Salvador.

WOODRUFF: Congressman Solarz, does this persuade you?

Rep. STEPHEN SOLARZ: I don't think these pictures, Judy, in and of themselves prove anything. To suggest, as you did, that all one can see are a lot of white blobs is to imply that it has a degree of precision, which I think is actually lacking in the pictures that we just saw. Nevertheless, having said that, let me say that having looked into the evidence over the course of the last several years, I personally believe that the Nicaraguans are deeply involved in efforts to provide arms and other forms of material assistance to the rebels in El Salvador. In that sense I don't think these pictures, even if they in fact demonstrate what the State Department claims they demonstrate are so, show us anything or tell us anything we didn't already know. The real issue is not whether the Nicaraguans are helping the rebels in Salvador, but what we ought to be doing about it.

WOODRUFF: All right, So then let's move on to that. Ambassador Pickering, how does this evidence, the pictures and the rest of it, add up to the case that you are trying to make to the Congress that all this extra money is necessary?

Amb. PICKERING: Well, I'm delighted Steve agrees with the assessment. We have, I think, no differences on that score. I think the action on the Hill indicates that people are skeptical about the need for more assistance for El Salvador at the present time. The very important point is that you have a sea change in the government of El Salvador, a new president committed to all the things that we would like to see Salvador committed to doing, and moving in the direction of making changes in El Salvador in the human rights area, in the area of better government, in the area of improving their economic conditions. And for these reasons, we believe he, as the new president, very much deserves our support. President Reagan has presented a two-year package, and obviously debate now is how to get that two-year package through Steve and his colleagues.

WOODRUFF: All right. Mr. Solarz?

Rep. SOLARZ: The point I would make, Judy, is that over the course of the last several years we've already provided El Salvador with about $325 million in military assistance. For this year alone we've given them $126 million in military assistance. And at the beginning of the next fiscal year, which starts on October 1st, only several weeks from now, they're scheduled to receive an additional $132 million.

WOODRUFF: But they're asking for 117 now for the rest of this fiscal year.

Rep. SOLARZ: Yeah, on top of the $126 million they've already gotten and on top of the $132 million they're scheduled to receive as of October 1st.

WOODRUFF: And you say they shouldn't get any of the 117, is that it?

Rep. SOLARZ: I think it would be premature to provide it at this tiem, for two reasons. First of all, we've already given El Salvador over 10 times as muh military assistance as the guerrillas have received from their outside supporters in Nicaragua, in Cuba and elsewhere.

WOODRUFF: All right, let's stop and ask Ambassador Pickering about that.

Amb. PICKERING: Well, I don't know where Steve gets his math. Up until that 10-times figure, I tracked along with him. I don't think there's any way of establishing that. Everybody knows of course that a 10-to-one force ratio, perhaps 10 to one is required to deal with guerrillas. Whatever that amy be, the math is not important. What we've had here year after year is the Congress dribbling out assistance, keeping Salvador on, in effect, starvation wages. The President has come in with a two-year program designed in effect to try to improve the capacity of the Salvadoran military to deal with the security situation.

WOODRUFF: Okay, but then how do you justify this fourfold increase, that last year the appropriation was, what, $81 million, and this year you're talking about --

Anb, PICKERING: Last year the President asked for $130 million. This year we have finally succeeded with all the impetus of the National Bipartisan Commission's report for their statement to the President that he urgently needed this money, he needed an increase, that we are somewhere below what he asked for last year and well -- in my view, what we got last year was barely enough to stay alive.

Rep. SOLARZ: The figures that I cited, Judy, about the amount of support which had been received by the rebels in El Salvador come from our own intelligence agencies. It is indisputable that we have given far more military assistance to the government than the guerrillas have gotten from either Nicaragua or Cuba. Yet in spite of that fact, the guerrillas are probably stronger today than they were a few years ago. The reason I think is that the main problem --

WOODRUFF: That could be an argument for more aid, couldn't it?

Rep. SOLARZ: No, but the main problem -- I don't think so, because the main problem which the Salvadoran military has in my judgment is not so much a function of an absence of arms or ammunition; it has to do with ineffective leadership, with inadequate motivation, with corruption and the like. And unless they can get their own act together, I think all of the military assistance in the world will do them relatively little good.

WOODRUFF: All right. Quickly, Mr. Ambassador, on this point.

Amb. PICKERING: Quickly on that, the Salvadoran military leadership went through an enormous organizational change in November of 1983. Since then we have seen forces in the field much more often, fighting at night as well as the daytime. In the period since the first of January right on through to now they have dominated, by maintaining the initiative, the battlefield. There is no question at all in my mind that more assistance is required. It's clearly demonstrated by all the facts and figures that we have presented, and now is not the time to undermine a democratic leader by cutting his ssistance.

WOODRUFF: All right, two last quick questions. What do you think the prospects are, Mr. Congressman, in conference committee?How much do you think -- you'll think they'll get something, right, the question is how much?

Rep. SOLARZ: I doubt very much the administration will get all of the additional money it's requested, because I think the House of Representatives in particular will want to know whether there's continued progress in eliminating the death squads and bringing the security forces under control.

WOODRUFF: All right. And Mr. Ambassador, what happens if you don't get everything you ask for, if you only get part of it?

Amb. PICKERING: Well, if we don't get all of what we ask for, obviously the need will continue -- that isn't going to go away because the Congress is not capable of facing up to the reality at this time.

WOODRUFF: And our need to discuss this issue will continue also.

Rep. SOLARZ: We shall return.

WOODRUFF: Mr. Ambassador, Congressman Solarz, thank you both for being with us.

Rep. SOLARZ: Thank you, Judy.

Amb. PICKERING: Thank you.

WOODRUFF: Jim?

LEHRER: Robin, actually.

WOODRUFF: I'm sorry. Robin?

MacNEIL: In Warsaw, Jacek Kuron, the leading intellectual in the Polish Solidarity opposition, was released from prison today under a general amnesty for political prisoners. Kuron had been in prison since December 1981 on charges of trying to overthrow the Communist system.He immediately denounced the amnesty that set him free, saying it deprived him of the chance to prove his innocence in court, since there will now be no trial.

Richard Burton was buried today in the village of Ciligny, Switzerland, with a book of verse by the Welsh poet Dylan Thomas and a song sung in Welsh by his three brothers. It was a small and simple ceremony. Only about 80 family members and close friends were there. Here's a report from Philip Hayton of the BBC.

PHILIP HAYTON [voice-over]: His fifth wife, Sally, led the mourners. Recently Burton had said, "This is my last marriage. The next one will be to the grave." The mourners were a strange mixture reflecting Hollywood glamor and Welsh grit. They summed up what had meant so much to Richard Burton: his Welsh roots and his stardom. Burton's wish to be buried in Switzerland upset some of his family, but he was laid to rest in a mountainside not all that unlike his birthplace, and the sounds that rang out would have made him feel very much at home.

LEHRER: An update on a story we covered here week.The Federal Communications Commission today decided to postpone its rule raising the number of television stations one owner could hold from seven to 12. It will stay at seven until next April if the FCC does not take other action sooner. The FCC said it postponed the change in response to concern expressed by members of Congress. However, the number of radio stations that one owner can hold did change from seven to 12 today.

Robin?

MacNEIL: Once again, the main news stories of the day. Republicans in the conservative wing of the party called for a plank in the platform making an ironclad promise there will be no tax increase.

The House gave final congressional approval to a bill to give women equal pension rights with men.

President Reagan told Congress his proposal for aid to Central America, including $117 million in military assistance for El Salvador, is vitally urgent and should be approved without delay.

Iraqi warplanes attacked an Iranian oil drilling platform in the Persian Gulf and set it on fire. And the Soviet Union, Britain and France joined the operation to sweep for mines in the Red Sea. Jim? Tales from Route 89: Arizona

LEHRER: We close tonight with a NewsHour first: back-to-back sports stories. Story number one is also part two of our little series from Route 89 -- that's U.S. Highway 89 which runs north-south from Canada to Mexico across the states of Montana, Wyoming, Idaho, Utah and Arizona.

[voice-over] Our focus is on the Arizona piece of it, and tonight in particular on a young star who lives in Tucson, a sprawling, booming city of 570,000 people. Our star is a pitcher for the Angels, a Little League baseball team in Tucson. She is 12 years old; her name is Heather Conway.

HEATHER CONWAY [voice-over]: I think about throwing to the target when I pitch, just to throw right to it. You have to know where to place the ball when you pitch, because some kids can just hit some right at the belt level and some kids swing for low ones and swing for high ones. So you have to place it. My dad's taught me how to pitch and basically how to play baseball.

DEAN CONWAY, father [on the field]: You're trying a little bit too hard right now. Just get the target, okay?

HEATHER: He's been my coach for a long time, and so he pushes me really hard and to do my best.

Mr. CONWAY: I didn't actually teach Heather to pitch. When she began pitching, she picked her own style, and she's been doing this all on her own, because the way that she started pitching, I didn't have to change the style, the kick -- everything was natural, the way she drops her arm back and comes straight overhand; it was a natural pitch.

HEATHER: When I strike them out, I'm sure they think it's different because I'm a girl and they're a boy. But it really doesn't matter that much.

STEVIE CONWAY, mother: Most of them are, you know, very supportive and like that to Heather. But there's been a couple of them that are just as competitive as Heather, and they're a little bit jealous and they just, oh, they just harass her a little bit. But because of that she gets out there and tries twice as hard. It doesn't intimidate her in any way.

HEATHER: They don't mind me playing with them, the boys, at all. Because at this are I'm just as good as them. Well, this year's my last year in baseball and next year I'm going to go to softball. My parents want me to switch instead of going on in baseball.Because, wel, everything's bigger and the field's bigger and the pitching's farther and faster. So I think that's why they want me to switch.

Mrs. CONWAY: Oh boy, that's a hard question. I'm telling her that maybe she ought to go over to softball. There might be more opportunities in scholarships and things like that in the future for her, rather than in baseball.

Mr. CONWAY: Well, it'd be a little bit harder when she -- if she keeps playing baseball, because she would in different parts of it, she'd have to be separated. The guys would all have to go to their own locker room, and they'd kid around; she'd have to go by herself, and you know, she would be separated.

HEATHER: I'm sure I could do it, but I don't know if I could keep up with them after switching up to the bigger league.

Mr. CONWAY: I think the boys are more serious and they work at it harder, and the girls, their parents and just themselves have never competed and pushed themselves that way. There are some, there's a few, but the majority of them don't work at it the way boys do. That's why I kept her in the Little League and didn't put her in softball earlier, because as long as she's got the ability to compete, that's how you get better, with the competition being better than you or at least equal to you, since you keep striving to do better.

[on the field] Good job, good job. Hey guys, you still got to work on the runs. Let's get the bats going.

[interviewed] The trouble is right now she's growing up and it's a change for me too, because she is becoming a teenager and she's growing up, and it's a change for me to work with her.

Mrs. CONWAY: We're still kind of tossing it around. If she really wants to go, we'll probably let her go. But I don't know, I just think that this is kind of the turning point. It's a good time to break away right now.

HEATHER: I'm sure I could have gone on if I was born as a boy, yeah. Dwight Stones: Golden Oldie

LEHRER: Sports story number two is from the biggest of the big sporting events, the Olympics, and one of its biggest veteran stars, Dwight Stones, the poet laureate of track and field's most poetic, lyrical sport, the high jump.Tomorrow he begins a try for a record: the third Olympic medal in the high jump. Larry Merchant, our special correspondent at the Olympics, reports.

LARRY MERCHANT [voice-over]: The year is 1972. The Democrats have just nominated George McGovern as their presidential candidate. The Republicans have decided to renominate Richard Nixon.

[on camera] And there was a young man on the American Olympic team in Munich named Dwight Stones, a high jumper. Now it's 1984. The names of the presidential contenders have changed, but Dwight Stones, an American original, one of a kind, is still with us.In fact, at the age of 30 he qualified for these Olympics by setting an American record in the high jump at seven feet, eight inches.

[interviewing] Dwight, the career of a high jumper seems almost to go like the parabola of his jumps: up and down quickly. Why are you still here after all these years?

DWIGHT STONES, U.S. Olympic high jumper: Because it has remained fun and a challenge to me. Even in the last meet of the season when I really am burned out mentally and I want to go home, when I start to warm up, something happens, and I take my first couple of warmup jumps and I go, "Oops, there it is again." There's a chemical reaction that takes place inside me that I have no control over, and because it's still fun, I'm still into it.

MERCHANT [voice-over]: A part of that chemical reaction is the deliberate sense of drama that Stones brings to high jumping.

Mr. STONES: I really do love to be on stage, whether it's in front of a big crowd or a small crowd with television watching. It's so important to me as an individual for my personality to come out. It's really my vehicle for expressing whatever opinions I may or may not have.

MERCHANT [voice-over]: For Stones, high jumping is many things -- the feeling of fighting time as well as gravity; the silence that proceeds each jump; the summoning of concentration and the explosion of spontaneity as he commits himself.

Mr. STONES: But when you realize that our whole thing is wound up over jumping over a one-inche piece of fiberglass that's 13 feet, 1 1/2 inches long into a thing of foam rubber, it's difficult not to have some eccentric idiosyncracies.

MERCHANT [voice-over]: And Stones readily admits that he has more than his share of them.

Mr. STONES: I go through a whole imagery situation that has become part of my routine. It drives a lot of people crazy, because I take a long time to jump.But I'm really going through the actual execution of the event, the steps where they should be, so as to program the computer. And when I'm jumping well and my concentration's at a high level, I usually program the computer very very well and I get an outstanding readout.

MERCHANT [voice-over]: For this Olympics, Stones is going to need the best readout of his career, because his competition will include Zhu Jianhua, the Chinese high jumper who holds the world's record of seven feet, 10 inches -- two inches better than Stones' personal best.

Mr. STONES: Of late it is now being called the best head-to-head competition of the Olympic Games, Zhu Jianhua against Dwight Stones in the high jump. And he has the three best marks in history. I used to have that many of the best marks in history. He's a rookie in the Olympic Games; it's my third time. He's 22 or 21; I'm 30, or something. And I think the chance that I have to beat him is that anybody can be the best on that one day. I don't have any more chances.This is it for me. And I have to do whatever I can to be the best I can be that day. It's definitely going to take a personal record on my part. Maybe it's not fated that I win this thing, and maybe it is. We won't know that until August the 11th at about 8:30 at night.

MERCHANT: Dwight Stones will say a few words. He's one of those people who wakes up in the morning and starts to narrate his life, and then discovers there's a way to exploit that talent, in sportscasting.

Mr. STONES: To me, the ultimate in sportscasting is play by play. And I have done the ultimate in one area. I would like to also pursue the ultimate in another.

MERCHANT: Can you give me 15 seconds of Dwight Stones describing Dwight Stones clearing 7-9 at the Lympics to win the Gold Medal.

Mr. STONES: Here's the situation. Stones has misses. He misses this, he's fourth; he makes it, he's first. No one jumps after him, no one is over it. He's rocking back, he steps back, only six seconds left on the closk. He hits mark, the arms look good, the speed is excellent. He plants, he's up. The bar wiggles. He's over! He's the Olympic champion.

LEHRER: Good night, Robin.

MacNEIL: Good night, Jim. That's our NewsHour tonight. We will be back tomorrow night. I'm Robert MacNeil. Good night.