The NewsHour with Jim Lehrer

RAY SUAREZ: Good evening. I'm Ray Suarez. Jim Lehrer is off this evening. On the NewsHour tonight, the Justice Department and Microsoft react to the antitrust judgment against the company, Paul Solman looks at the continuing fight over genetically modified food, and Terence Smith examines the media coverage of the Elian Gonzalez story. It all follows our summary of the news this Tuesday.

NEWS SUMMARY

RAY SUAREZ: This was a wild day on Wall Street. The NASDAQ Index and the Dow Jones Industrial Average each lost about 500 points by early afternoon. Then they rallied. The NASDAQ ended up losing 74 points to finish at 4148. The Dow lost 57 points to close at 11,164. Analysts blamed the gyration on a continued sell-off in high- tech stocks. It accelerated with yesterday's Microsoft antitrust decision. At the White House, economic adviser Gene Sperling counseled calm.

GENE SPERLING: If you want to talk about the impact on real people's lives in terms of people working, making wages that are above income so that they can provide for the families and save a little, in terms of the investment and the kind of productivity growth that will lead the United States to be a good place to invest and a place where people can earn high wages for the future, I think the new economy is doing quite well. I do not think one should judge the strength of the fundamentals of our economy based on the movement of the market over a one-day or even a one-month period.

RAY SUAREZ: The NASDAQ's swing of 634 points between its high and low points for the day set a record. So did the 700-point swing on the Dow. On the Elian Gonzalez story, demonstrators in Miami broke through police barricades at the home where the boy is staying with relatives. They said they would keep him from being returned to Cuba. And federal officials talked again with relatives about a custody transfer. But they've now dropped a deadline for ordering the boy deported. In Havana, U.S. officials issued visas to the father and immediate family. It was unclear when they would leave for the United States. In Kosovo today, 26 people, including 11 American soldiers, were hurt in a melee south of the capital, Pristina. It started after NATO peacekeepers staged a weapons raid and made an arrest at a Serb house. A U.S. military statement said about 150 Serbs gathered outside and refused to let troops leave. It said the soldiers' injuries were not life-threatening. Japan's cabinet resigned today. The move paved the way for naming a new prime minister. We have this report from Philippa Meagher of Associated Press Television News.

PHILIPPA MEAGHER: Japan's acting prime minister, Mikio Aoki, held an emergency cabinet meeting to accept the mass resignation. The move came after it became clear that Prime Minister Keizo Obuchi wouldn't be able to resume his duties. Mr. Aoki told a news conference that the 62-year-old politician was being kept alive on a respirator after suffering a stroke. The cabinet resignations were needed to begin the formal process of replacing him. Mr. Aoki said the cabinet resigned to prevent a political vacuum forming. Yoshiro Mori, seen here behind Prime Minister Obuchi before he fell ill, is expected to be named as his replacement. He's currently the secretary- general of the ruling Liberal Democratic Party. Mr. Obuchi has been in a coma since Sunday at the heavily- guarded Juntendo Hospital in Tokyo. His daughter has returned from her studies in Britain to join her mother's vigil at the bedside.

RAY SUAREZ: And at the White House, officials said President Clinton expects to continue close ties with Japan's leadership. Two Russian cosmonauts blasted off today on a mission to revive the Mir Space Station. The 14-year-old outpost has been unoccupied for the last eight months. Russia's cash-strapped space program had planned to let it burn up in the atmosphere, but a Dutch company agreed to pay to keep it in orbit in exchange for commercial rights. Possible uses include visits by tourists. Another state has approved tough handgun restrictions. The Maryland House voted last night to require built-in locks on new handguns. The measure takes effect in 2003. Until then, new guns sold in the state must have external locks. The state Senate has already passed the measure, and the governor has said he'd sign it. Earlier Monday, Massachusetts said it would enforce similarregulations. Michigan State won the men's NCAA Basketball championship in Indianapolis last night. The Spartans beat the University of Florida Gators 89-76 for Michigan State's first title in 21 years. After the game, students danced in the streets of East Lansing, Michigan. There were several arrests for minor offenses. Last year, fans set fires and smashed cars after Michigan State lost in the semifinals. That's it for the News Summary tonight. Now it's on to the U.S. versus Microsoft, high-tech food, and Camp Elian.

UPDATE - U.S. VERSUS MICROSOFT

RAY SUAREZ: The federal antitrust case against Microsoft was led by Assistant Attorney General Joel Klein, who joins us now. Welcome to the program.

JOEL KLEIN, Assistant U.S. Attorney General: Good evening. Nice to be here.

RAY SUAREZ: Well, I'm sure you read that 43-page ruling very closely. What is your reaction?

JOEL KLEIN: I think it's a very strong and very important ruling -- not only for what it says about Microsoft's anti-competitive behavior -- the significant, pervasive, multifaceted campaign that Microsoft engaged in to harm competitors and ultimately harm the American public by denying them innovation. But even as importantly, Ray, I think it is a real landmark in anti-trust enforcement. You know, a lot of people have asked the antitrust laws, they're a hundred years old, what is their relevance for the current information new economy? And I think this court showed through very careful fact finding and very sophisticated legal analysis that antitrust enforcement is going to be important in the information age to deal with exactly the kinds of issues that we saw manifested here in the Microsoft case. So on many fronts I think this truly is an important victory for America's consumers and for law enforcement.

RAY SUAREZ: For its own part, the company said it would continue to innovate, hope to prevail on appeal and said that in its conclusion, all the things that you say were crimes have actually provided the consumer with convenience, low prices and an industry standard.

JOEL KLEIN: Well, the company can say that but the court heard evidence for 78 days -- much of it coming from Microsoft's own documents -- documents that say if we compete on the merits, we're going to lose in the browser war -- documents and testimony, their own witness saying we didn't want to put our browser right next to Netscape's browser because we knew we couldn't win that way. We needed to have exclusive arrangements. Let me make one thing clear, Ray: I think Microsoft should innovate. I encourage Microsoft to innovate. Nothing in what this case is about would in any way deter Microsoft's innovation. On the other hand, we want to make sure that Microsoft doesn't use its monopoly power to prevent others from innovating. The American way is to give that chance to the new entrepreneur, to the new person with the new product to get that product to market and give the public a choice, and then let the best product win. We don't have a horse in that race. I'm sorry that Microsoft sort of says, well, we're just going to go on and do it the same old way. You know, they signed a consent agreement with the Department of Justice in 1994. And they said they were - you know -- going to go forward in a constructive way, and then they turned around and engaged in all of this anti-competitive behavior. And I would hope Microsoft would join me in the following two principles: it should innovate; it should play by the rules; it should honor the antirust laws; and it should give everybody else the opportunityto innovate -- not to squelch their product through bolting two products together or exclusionary agreements or predatory practices, all of which is carefully documented not just in that 43-page opinion yesterday but in a 200 plus page findings of fact by a federal court who heard all of the evidence.

RAY SUAREZ: But what you call the bolting of two products together, the bundling of the web browser with the operating system, a court of appeals has already ruled that it finds nothing anti-competitive, nothing illegal about that. Shouldn't that give Microsoft heart on appeal?

JOEL KLEIN: I don't think so. I think the court of appeals case was a very different context. The court of appeals itself said of course this might all look very different after we look at the fact. The court of appeals had a consent decree case. This is the anti-trust laws. Now, that's what the trial was about. You see - you can't do this on television. One of the things I really urge people is to go on the world wide web and pull down these findings of fact and conclusions of laws, so you don't have to listen to sound bites and spin, because the trial was all about whether there was meaningful product integration, or whether, as the judge found, the two products were bolted together. You know, we all know if you have a monopoly in Windows and then you bolt another product on there, that's going to get mass distribution for you. That's what the evidence said and that was Microsoft's evidence that said we have got to quote: leverage our Windows monopoly in order to win the browser war. That's what trials are about and that's why I think it's so critical for the American people to really carefully review the court's findings and conclusions. I think they are really illuminating and informative.

RAY SUAREZ: Now, in a structural sense, who has the next move? Is it up to Judge Thomas Penfield Jackson to propose remedies, or for your side, the winning side in this case, to suggest to the court what those might be -- similar to a criminal case?

JOEL KLEIN: Sure, I think as a general matter what would happen and I expect it will happen here as well, the court will set a schedule. And then we will propose appropriate remedies to address the issues in the case. And then of course Microsoft would be given an opportunity to react to those remedies and the court would ultimately make a determination of what is appropriate in these circumstances.

RAY SUAREZ: Could you ask for some form of immediate relief, that is, some sort of penalty that would be imposed even as Microsoft goes through its next step in appeal?

JOEL KLEIN: That is certainly an option we have under consideration. No final decision has been made with respect to that, but you could seek interim remedies as well as long-term remedies, depending upon the fact and the circumstances, yes.

RAY SUAREZ: What did your experts advice you -- as this case was moving to its conclusion -- about what possibly remedy there maybe?

JOEL KLEIN: Well, we have had some really terrifically capable consultants, people with a broad range of technological, economic and industry- based information. And they've been looking at a variety of proposals. The most important thing here is to get a remedy that makes sure that yesterday's problems, that the harm that Microsoft did in the market yesterday isn't repeated tomorrow. Microsoft used a wide range of anti-competitive devices, not just this bolting of products, exclusionary contracts -- refusing to disclose technological information to competitors. We want to make sure going forward that those practices are not repeated and that innovation and competition prevail. You know, there has been a fair amount of misunderstanding that somehow we're fighting yesterday's war and this is a dynamic market. The dynamism of the software market an, in particular, the desktop computing market has been very flat because of Microsoft's monopoly. They have had a monopoly for as far back as people can remember Windows on the desktop. And they are going to have it for as far forward. How they use that monopoly is absolutely critical to the way we see innovation develop. And we want to make sure tomorrow's products are not snuffed out the way yesterday's products were. So that is what our remedy will seek to address.

RAY SUAREZ: But today, the day after the court announced its decision, you can go to the store and find an array of products that didn't exist or weren't in wide use when the government began this case. So how does that match up with your assertion that there has been a stifling of these new innovations?

JOEL KLEIN: Well, as the court found, for example, with respect to a critical product, the Internet browser, Microsoft essentially knocked out a platform threat by Netscape with respect to Java, which would have created cross platform opportunities. Microsoft took that out with respect to an Intel product, Microsoft took that out. Now, there are lots of products on the periphery that are new and innovative, but when it comes to operating systems on our PC's, there is essentially one product. It's Windows. And that product has great consequences for the future of computing -- for new technologies that Microsoft and only Microsoft can bundle, for access to the web, web servers, where so much activity is now going -- where Microsoft can favor its server products at the expense of other server products, which could have real competitive consequences, where Microsoft can favor its hand-held devices; these are all of tomorrow's issues. We just don't want to see the kind of activities as pervasive and significant because of the competitive threat that we saw to the browser, Java and other products at issue in this case.

RAY SUAREZ: Assistant Attorney General, Joel Klein, thanks for being with us.

JOEL KLEIN: Thank you. My pleasure.

RAY SUAREZ: Now the Microsoft view, and to Gwen Ifill.

GWEN IFILL: The company's deputy general counsel, Brad Smith, in Seattle.

Good evening, Mr. Smith. You heard Joel Klein say that Microsoft has in effect strangled the dynamism of the Internet industry, of the entire Internet industry. What is your response to that?

BRAD SMITH, Deputy General Counsel, Microsoft: Clearly we have working in an incredibly dynamic industry today. There is four times as many software companies in the United States creating software for the desktop as there was in 1990 when Windows first became popular. There is more venture capital flowing into the Internet area, into the software industry than there has ever been before. Our industry has never been as dynamic as it is today. I think anybody who just looks at the financial pages of the newspaper or watches your program every evening can see the tremendous amount of innovation that is taking place.

GWEN IFILL: When Judge Jackson issued his findings of fact last year, a Microsoft spokesman told Margaret Warner on this program that you were now in the third inning of a nine-inning game. Now, that baseball season has begun, I feel I can bring that question to you again. What innings are we at now?

BRAD SMITH: Well, I think we're probably just finishing up the third inning and we're probably not even at bat in the fourth. This case still has a long ways to go. As Mr. Klein just mentioned, we still have to go through a remedies phase in the district court and after that there is the appellate process. There is the court of appeals and potentially there's even the Supreme Court, so this case still has a long ways to go before it comes to an end.

GWEN IFILL: You heard Mr. Klein say, in fact, that he has not ruled out the potential of an interim penalty phase, something that would preclude whatever appeals process you are setting in motion here. Is that something you expect the government to do?

BRAD SMITH: We'll take things one step at a time and we'll wait for him to tell us what the government is going to do next.

GWEN IFILL: Well, let's talk about the appeals process then. How long and at what cost are you prepared to take this appeal?

BRAD SMITH: Well, we really look at this from two perspectives. On the one hand, as we've said, we put an enormous amount of time and energy into trying to reach an amicable agreement in the case -- in the mediation before Judge Posner in. That would still be our preference. As Judge Posner said, it's in the public interest that everyone reach an agreement on this important issue. At the same time, if we cannot reach an agreement, there is an important principle we are prepared to stand up for and we are prepared to litigate on appeal. And that is the right that we feel that we and every other company needs to have, the right to continue to add new features to products if consumers are going to benefit from the result.

GWEN IFILL: Your boss, Bill Gates, said yesterday that there is still a potential for settlement, or at least you're always willing to come to the table. But were you, in fact, so far apart that the potential for settlement has now gone away?

BRAD SMITH: I think it's too early to know. This, as I've said, is a long process. Unfortunately, we didn't reach an agreement last week. Whether that will change and prospects will improve two months or two years from now, we'll just have to take it one step at a time. Certainly we remain committed to reaching an agreement if that is possible.

GWEN IFILL: Big roller coaster at the stock market today. Were you at all concerned about the Microsoft sell-off?

BRAD SMITH: We look at our business and indeed every aspect of our business from a long-term perspective. We don't focus on he impact of the financial markets on a day or a week. And, for that matter, what we really focus on is not the financial markets at all but how we need to work to develop better products, to bring to market a new generation of software that is going to take computers into the next stage of this Internet era.

GWEN IFILL: And, in fact, computers are changing so rapidly, is it possible that if you were to take this to the next logical steps of appeal up and up and onward that by the time there was any kind of final decision reached on this that, in fact, technology would have outpaced any kind of remedy?

BRAD SMITH: Well, certainly we're see our industry continuing to change extraordinarily rapidly. And since this case was first filed we've seen all of these changes in the marketplace -- the rise of new software operating systems such as Linux, changes in terms of AOL first acquiring Netscape then acquiring Time Warner. The competitive landscape is constantly being reshaped, but I would agree with Mr. Klein that this case remains of great importance because fundamentally what it asks is what the rule oflaw should be. When should a technology company be able to integrate new features into its products? In our view, a technology company should be able to add a new feature if consumers are going to benefit from the result.

GWEN IFILL: I'm sorry, you and Mr. Klein do agree on the point this is a landmark decision but you agree for different reasons. In your case you think that the government is attempting to stifle innovation?

BRAD SMITH: What I'm suggesting is that we've enjoyed in this country over the last three decades a rule of law that has said that a company can always improve its products. It can always add new features into its products if consumers benefit from the result. That is fundamentally what the court of appeals said in June of 1998 in the first case involving Microsoft. That is what we hope ultimately the courts will rule in this case as well, because that is the rule that we think is going to continue to benefit consumers, and that is the rule that is going to enable the technology industry to continue to contribute to the country's economic growth.

GWEN IFILL: But on the question of innovation Mr. Klein said there is nothing in this decision - in Judge Jackson's decision -- which would deter Microsoft's ability to innovate. Do you agree with that?

BRAD SMITH: We respectfully disagree with that point of view. I think it's important to keep in mind that in the first case we had with the government, the court of appeals articulated a very clear cut rule, namely that a company can innovate if consumers benefit from the result. Yesterday's decision took a fairly substantial step away from that rule. And we think it's important to get back to that rule because that is the rule that will best encourage innovation - not a rule that asks courts to take a closer look and get more involved in scrutinizing the way technology products are designed.

GWEN IFILL: In addition to the Department of Justice and 19 attorneys general, are you prepared now for this ruling to result in a spate of private lawsuits?

BRAD SMITH: We're certainly prepared for whatever litigation results. Indeed, after the findings of fact were issued, we saw a spate of private lawsuits. But fundamentally we believe that those cases don't have any real merit to them. They are all based on a legal allegation that somehow the price of Microsoft Windows was too high when, in fact, if you lock at the price of our products, they've been low, they have fallen even more overtime and from a broader perspective what we as a company have done is turned a product that previously was sold in very low volume at a high price and turned it into a product that is sold at very high volume at low price. It has made computing accessible to every person in every home. That is something that consumers have benefited from and I think that is something that courts will recognize as they review these private lawsuits.

GWEN IFILL: There seems to be a competition now going on with the government on one side, you on the other side, all competing to say that I am the true voice of the consumer in this. How do you take that? I don't know whether it's a public relations strategy or a legal strategy for the next few steps. How do you take that and make that understandable to make your case that way?

BRAD SMITH: Well, first I guess I would point out that at least it's good that we agree that it's the consumer's interest that should come first and foremost. Where we disagree is on how we can do the best job to make this industry work in the consumer's interest. We think that we have an industry that is remarkably vibrant. It has made computers more powerful and less expensive. It's made it possible for the large number of people in this country to have a computer in their home. We think that the law, the kind of legal rules that have encouraged this innovation should be allowed to keep encouraging this kind of innovation. We don't think it makes sense to make a change and to ask the government to intervene in this industry and play a different role from the role that it has played over the last two decades.

GWEN IFILL: You are the company's deputy general counsel. What kind of case do you think you have on appeal?

BRAD SMITH: Well, we remain very confident about our case on appeal. We have always believed that all of the innovations we have undertaken have operated to the benefit of consumers. We took this case up on appeal once before. It was a slightly different context, but fundamentally the issues were the same, and when we did, that the court of appeals decided in June of 1998 in our favor. So we continue to have cause for confidence that the judicial system when it looks at all of those issues will conclude that the kind of outcome that we saw in 1998 is the kind of outcome that will best serve consumers in the year 2000 and beyond.

GWEN IFILL: Brad Smith, thank you very much.

BRAD SMITH: Thank you.

RAY SUAREZ: Still to come on the NewsHour tonight, high tech food and Camp Elian.

FOCUS - HIGH TECH FOOD

RAY SUAREZ: Yesterday, a group of leading biotechnology companies launched an effort to convince consumers genetically engineered food is safe. That comes amid much fear and opposition to the new high tech products. Our business correspondent, Paul Solman of WGBH-Boston, has been looking into the subject. Here is his report.

PAUL SOLMAN: In Iowa, a grain train lugs corn and soybeans to market. It looks innocent enough, but riding in those cars is the stuff of controversy, because nearly half of America's corn and soybeans are now genetically modified organisms-- GMO's. The GMO controversy pits Europe against the U.S., activists against agribusiness, skeptics like Greenpeace against corporations like Monsanto. And the controversy raises key questions as to how we as a society weigh the risks and benefits of new technology in general. Now, when you look back in history, it turns out we've been toying with plant genetics for quite a while.

SPOKESMAN: In Adair County, Iowa, an energetic young high school student named Henry Agard Wallace accepts a challenge.

PAUL SOLMAN: Already by the 1920's, budding agronomist Henry Wallace was mating different strains of corn to produce the best traits of both, crossing a high-yield plant with one that didn't need much water, say, to create a new high-yield breed for dry climates. Wallace himself went on to become Secretary of Agriculture, then FDR's Vice President. Hybridization, rejected at first as a risky and radical agri- technology, became "the" standard way to improve crops.

SPOKESMAN: Don't get poked in the eye.

PAUL SOLMAN: Even today, though, plant breeding retains a certain sex appeal. At Pioneer Hi-Bred, the now- giant seed company that Wallace himself started, corn is still often created intimately. Pioneer's Andrew Waber showed us. That's the male part?

ANDREW WABER: That's the male. We call it the tassel.

PAUL SOLMAN: Tassel.

ANDREW WABER: Within the tassel, it will actually shed pollen. This is what blows around in corn fields in Iowa. This is your female. This is the female receptacle, or as we call it, the silk. You simply just pour the pollen directly on that silk, and now you've created the pollination.

PAUL SOLMAN: When different corn plants mate, the results are as unpredictable as with humans. Traits from each parent will pass to the offspring, but you never know which. The breakthrough of genetic modification is that the plant's DNA can now be manipulated in the lab, a huge leap forward, according to the company.

PEG ARMONSTRONG-GUSTAFSON, Pioneer Hi-Bred: Instead of hoping that the random combination of all of the genes brings forth what you want, you can specifically go in and say, "this is the part of the plant that I want to change," and go in and specifically do that.

PAUL SOLMAN: So where's the controversy? Well, for certain traits, genes from entirely different types of organisms are put into the plant's DNA. America's most common seed corn now boasts bacteria genes which trigger a toxin against corn's archenemy, the corn borer. It seems to work, looks just like the old corn, may even mean farmers can use less pesticide, but it's arguably a brand-new entity, a genetically modified organism, or GMO; and that has some folks worried. Nutrition consultant Sue Roberts:

SUE ROBERTS, Dietician: The new genetic engineering is crossing species lines, and that is a completely different process than what we've been doing.

PAUL SOLMAN: With GMO'S, says Roberts, come unknowable dangers to our food.

SUE ROBERTS: One is toxins that the food might potentially produce; one is allergens that the food might potentially have; another issue is antibiotic resistance. Another one is just are there other potential viruses that could be harmful that can be formed from this process?

PAUL SOLMAN: To skeptics, the key is not that GMO's have been proved to cause these dangers, but haven't been proved not to. They point to the fact that GMO's were fast-tracked by the Food & Drug Administration despite the misgivings of some FDA -- scientists. So the manufacturers do all the testing-- tests which may be rigorous, but not at the level required for new drugs or food additives.

SUE ROBERTS: There haven't been enough studies done in humans; there haven't been enough done in animals, or whatever the progression should be to test these products like we would with a food additive or with a drug.

PAUL SOLMAN: Farmer George Naylor is similarly skeptical about genetically modified organisms-- GMO's.

GEORGE NAYLOR, Farmer: We live in a sea of corn and soybeans out here in Iowa, and we don't know what we're producing and we don't know the effects on the land, we don't know the effects on human health or the health of the animals that eat this feed.

PAUL SOLMAN: In this age of agribusiness, Naylor's trying to maintain, with his wife and two boys, a family farm with family values. He raises non-GMO grain, and hopes to sell it at a premium to those who share his antipathy to agri-tech. But Naylor feels that farmers like himself are isolated, up against a corporate GMO juggernaut that threatens to lay waste to their plans. One of his fears: Contamination from GMO corn the next field over.

GEORGE NAYLOR: As the pollen drifts from his field to my field, it's going to pollinate some of my corn, so that the genes from his crop will be transferred into my crop.

PAUL SOLMAN: The point is, if a non-GMO were impregnated by a GMO, its purity, says Naylor, would be compromised.

PAUL SOLMAN: So this is non-GMO Corn?

GEORGE NAYLOR: I hope it is. The only reason that it wouldn't be is because either the seed was contaminated when I bought it, or my neighbor's pollen has pollinated some of my corn.

PAUL SOLMAN: Even if he could vouch for his grain, however, Naylor would have another problem. He'd be hard-pressed to keep his corn separate from its GMO look-alikes.

GEORGE NAYLOR: Now, this is where farmers bring their grain to store, and it was impossible to really segregate the GMO From the non-GMO grain this last year, so now it's just all blended together in here.

PAUL SOLMAN: So you mean even though you're doing non-GMO grain, by the time it goes to market from here...

GEORGE NAYLOR: Right, it's the same. No, it's all the same. The consumer's going to get GMO grain whether they want it or not.

PAUL SOLMAN: It's this lack of choice that's helped fuel the anti- GMO Movement, especially in Europe and the U.K., where there's widespread objection to America's so-called Frankenfoods, and Prime Minister Tony Blair's unwillingness to oppose them. Perhaps fearing similar protests at home, companies like Heinz, Frito-Lay, and Gerber have now promised they won't use GMO'S to make their products. Agricultural Law Professor Neil Hamilton:

NEIL HAMILTON, Drake University: Frito-Lay and Gerber and other people that may have made those same decisions are consumer companies, and they have made some type of calculation of two things: One, that there may be some concern on the part of consumers, or alternatively that the benefits of whatever this technology is don't inure it enough to them to take a bullet for it.

PAUL SOLMAN: So what are the benefits of genetically modified organisms? Some say they're enormous: Cheap rice with enough Vitamin "A" built into it to cure blindness in the third world; crops so productive we can feed millions more people without leveling the rain forest. Promises like these are what led Monsanto Chemical to transform itself into a life sciences agri-tech company in the early 90's. To investors, GMO's and agri- tech promised huge future returns, not unlike the Internet. Monsanto's stock soared. Money to nurture the new technology poured in. But then came the protest movement, charging that GMO corn, for instance, would lead to super weeds; would kill monarch butterflies. Monsanto CEO Robert Shapiro responded, as here to a Greenpeace conference in the late 90's.

ROBERT SHAPIRO, Monsanto CEO: (film) Now, we continue to believe in this technology. We think it can bring important benefits to people around the world, and we remain committed to developing good, safe, useful products. But we are no longer going to be engaged in a debate.

PAUL SOLMAN: But opposition to Monsanto only grew. The company's stock sank. Agri-tech research and development slowed. To economist Dermot Hayes, it was an outrage.

DERMOT HAYES, Iowa State University: Can you imagine how Bill Gates would feel if somebody had said that microchips cause cancer? And then the argument was we can't prove they don't cause cancer, so the stock of Microsoft collapses. Imagine how you would feel, especially if it wasn't true.

PAUL SOLMAN: And you think that's how Bob Shapiro feels.

DERMOT HAYES: I think that's how he should feel. He was doing something that was potentially of great advantage to the human race. Some arguments were made against the technologies; they were not based on science. The technology is now stalled, and the company, as a result, has fallen in value.

PAUL SOLMAN: So if genetic technology is so promising, why are opponents making as much headway as they are? Perhaps because the first GMO products don't benefit the public so much as the industry itself. Take GMO soybeans called Roundup Ready, the patent for which is owned by Monsanto. They're designed to be used exclusively with the popular herbicide Roundup, also made by Monsanto. The company, says Neil Hamilton, went first for quick returns.

NEIL HAMILTON: It shouldn't be any surprise that one of the main reasons that you would develop Roundup Ready technology for soybeans is so that you can sell more Roundup.

PAUL SOLMAN: So when the industry promises higher-yielding plants that will feed the world's poor, critics respond, "that's not what you're using GMO's for now." Moreover, American farmers already produce more food than they can sell, as evidenced by this corn overflow we happened on in Beaver, Iowa. And GMO's are now actually hurting sales of American grain because Europeans don't want them. So to many consumers, the benefits of GMO's seem remote, while the risks of this unknown technology can be made to seem threatening. "Remember nuclear power," say critics. In the 50's, we were told that it was cheap and safe, the answer to our energy future. But today, we know how much we didn't know then.

SUE ROBERTS: There's a quote that really captures my feeling about the issue of genetically engineered food, and that quote is, "Nature is not only more complicated than we think, it is more complicated than we can think." And we should err on the side of precaution rather than plowing ahead and putting those foods into our food supply until definitely the safety is proven.

PAUL SOLMAN: Caution sounds reasonable. But years of study, say GMO proponents, will stall a technology that promises to feed the world. To Dermot Hayes, the benefits of GMO's dwarf the risks, but the risks are a lot easier to sell.

DERMOT HAYES: The consumer in a store will give you about a second to make your case. And if somebody says, "We can't prove that this food does not cause cancer," you will not consume that food. And that's essentially what's happened in Ireland and the UK. People just won't... they don't want this food, not because they've looked into the science, but because they have heard something on the TV from some source that may or may not be good that there's something wrong with this food.

PAUL SOLMAN: In other words, until the public can be persuaded of the benefits and safety of GMO's, this latest in a long line of new technologies may continue to meet resistance in the streets, on the stock market, and on the shelves.

RAY SUAREZ: On another front in the GMO controversy, a much- anticipated report on the adequacy of government regulation of genetically modified crops is due to be released tomorrow by a National Academies of Science committee.

FOCUS - CAMP ELIAN

RAY SUAREZ: The ongoing media fascination with the story of young Elian Gonzalez, and to media correspondent Terence Smith.

TERENCE SMITH: The picture of innocence, a young boy scampering with his puppy. American media love kid stories, but of course what you are actually witnessing is a grownup tale of international politics and fierce family infighting. The story began last Thanksgiving Day, when young Elian Gonzalez was found clinging to an inner tube in the waters off Florida. His mother and others had perished at sea during their escape from Cuba. This was the media circus back in January outside the house where six-year-old Elian has been staying with his relatives in the little Havana section of Miami. Here is the same scene this week. The crowd of onlookers has grown in size and passion, and the national media continue to cover the story around the clock. Reporters and commentators on the ground explainwhy they are there.

CHRIS MATTHEWS, Anchor, CNBS & MSNBC "Hardball": If there wasn't a Fidel Castro, the mother would have come here on a passport, not on a raft, right? So these players are all important. If there wasn't a mother who died getting a kid here, we wouldn't have the human passion that obviously has been aroused here. A mother dies getting a kid over here, and we're going to flip him back over the modern equivalent of the Berlin Wall?

KATHY MOSS, Correspondent, CBS News: The fact that we see a little boy, a sweet little boy with a sweet little face playing on swings each day, who is smiling through it all, through this, you know, ugly, bitter custody battle, makes the story even more compelling.

TERENCE SMITH: Some of the coverage, such as ABC's "Good Morning America's" visit with the boy, has become part of the controversy. It was aired over three mornings last week on "Good Morning America," and on a segment of the ABC newsmagazine "20/20."

ANCHOR: "Would you like your dad to come visit here," we asked.? He whispers, "No." "No," we ask, "why not?" He answers, "Because he'll take me to Cuba and I don't want to go to Cuba."

TERENCE SMITH: ABC originally said it would not air that exchange so as to avoid becoming part of the political struggle. Executives then decided to run with it. The network dubbed the Sawyer-Elian exchange a visit, rather than an interview, to defuse perceptual and potential legal problems. But some critics have assailed the encounter as nothing less than child abuse.

MODERATOR: Dr. Butterworth in Los Angeles has said, quote-- of this interview -- called it "nothing short of psychological and political exploitation of a helpless victim."

TERENCE SMITH: This political cartoon was distributed outside ABC News by Cuban American groups demonstrating against the interview and for the return of Elian to his father. And this political cartoon from the "Miami Herald" reflects the battle being fought over the youngster. One report by Miami station covering the stalemate even drew bomb threats from Cuban exiles when it suggested that Elian had said he would like to return to Cuba. While local coverage from has been predictably exhaustive, stations as far north and culturally removed as Boston have dispatched reporters to cover the story.

REPORTER: It was a day of wrangling behind the scenes and in front of the cameras.

TERENCE SMITH: Some critics see this scene as a feeding frenzy. Others defend it as the kind of blanket coverage a big story warrants. In either case, it has been extensive: Some 51 minutes of network coverage last week alone, according to the independent Tyndall Report.

ANCHOR: The bitter custody fight got even nastier today.

TERENCE SMITH: All told, Elian's story got double the network time devoted to soaring oil prices, triple that of the tornadoes in Texas, and four times the coverage of the gyrating stock market.

ANCHOR: It's a mess, the battle of the fate over Elian Gonzalez certainly is going to drag on into at least another week -- providing still more grist for the mills of the radio talk shows.

TERENCE SMITH: The coverage seems unlikely to diminish until there is some sort of resolution of the standoff. In the meantime, Elian got a new pet for Easter, and the omnipresent cameras got a fresh subject on which to focus.

TERENCE SMITH: Here to discuss why the cameras are omnipresent in little Elian's world are "Miami Herald" associate editor Mark Seibel, who has been managing his paper's coverage of the story for several months; longtime journalist and observer Hodding Carter III, who is president of the john S. and James L. Knight Foundation in Miami; Susan Candiotti, a CNN Miami bureau correspondent who has been stationed at Camp Elian; and Armando Guzman, a national correspondent for Univision's Spanish Language Television News in Washington. Welcome to you all.

Hodding Carter, what is your reaction to this coverage ranging from the Diane Sawyer interview to that scene outside the family's home in Miami?

HODDING CARTER, Knight Foundation: Well, it is a mixed answer. First for Miami this is a major story. It involves most of the most passionate elements of this community. It is a story in its own right for almost anybody else. But for most of the media outside this immediate area, this is a great piece of exploitation. It is an exploitation of a traumatized child. It is an exploitation once more of making Miami into some of the freak show for national coverage. It is exploitation that is involved with the politicians on both sides of the divide between Cuba and here. It's exploitation by many of those I would add within the community of Miami who are dealing with real emotions about a real child to produce what amounts to metaphorical combat. And what's lost in all of this is the best interests of one little boy. It's been disgusting frankly.

TERENCE SMITH: Susan Candiotti, what is your reaction to that? Do you feel the coverage has been exploited?

SUSAN CANDIOTTI, CNN: Well, indeed it has been very painful to watch, quite frankly, all the cameras that have been camped outside this home and wonder what kind of effect in if any it has had on this youngster -- also painful to see the child put on the shoulders of many of the adults at this home when supporters have come by begging for the boy's appearance, and the Florida relatives here have willingly paraded him out in front of the crowds and in front of the cameras on at least a few different occasions when perhaps some might wonder, some have already raised the question about the priority much that and perhaps simply keeping the child as much as possible inside the house. You know, at the same time you have to wonder what exactly the child is thinking when all of this is going on as people are reaching out to touch him, as though they'll get a special feeling or perhaps a special power from him. Everyone -- the Cuban exile community in particular here -- feels a special connection from this boy that he has become a symbol to them I think of the ongoing cold war in their minds between the United States and Cuba.

TERENCE SMITH: Mark Seibel, do you think that extensive coverage is justified?

MARK SEIBEL, Miami Herald: Well, I do as a matter of fact. Of course, as a local story, we've devoted reams and reams of newsprint and tens of thousands of words to it. And it's a very important one for our readership but I think even in the discussion of whether we're exploiting the situation, I think in a way that is almost a caricature of the story because the nature of the story is really much deeper than that. It's not just about a little boy. And while that sort of -- how shall I say not to appear inhumane that is a humane of looking at it -- it is a little boy in a very traumatic situation -- but it touches a nerve in this community that goes deeper than that and, yes, everyone is concerned about the welfare of the child, but there is a 40-year history about Cuba that this city lives every day. And so when an event like this happens, there is a whole range of political and emotional sensitivities here that I think we have to explore and explore in great detail. It goes even beyond this community. Obviously one of the concerns of the United States government is how a case like this affects our ability to return children, American children that are being held by parents or others in foreign countries. So it's not just about a little boy.

TERENCE SMITH: So big story by several points of definition.

MARK SEIBEL: Yes.

TERENCE SMITH: Armando Guzman, it's obviously also a special story for the Spanish Language Press and the Hispanic community. How have you and how has that sector of the media approached it?

ARMANDO GUZMAN, Univision: Well, very extensively. We hope we had looked for all the angles that everybody else has, looked for, but let me tell you I think that is a legitimate story for many reasons, and I don't think that this is important only for the community in Miami. Elian, his mother and all the others, they didn't come in a boat to Miami; they came to the United States. That's why this debate and this discussion about what to do with Cuba for 40 years is reflected so intensively in this story. That's why for us in the Hispanic community and for the rest of the community of the United States, which is not different in that respect, it's a big piece.

TERENCE SMITH: Hodding Carter, who is manipulating whom in this situation?

HODDING CARTER: Well, let me begin with something because the image that comes immediately to mind for me is of a six-year-old boy being used as a club literally in an ongoing fight, and nothing new has come out of any of the coverage about this 40-year-old fight. Not a single new issue has arisen which is resolved by it. Indeed some issues have been obscured -- not least the question of what United States law actually is, and how in this case, betraying that law calls into real question the deep needs of literally thousands of parents and children. That -- I might add -- has been obscured here but in all of this coverage, I defy anybody to tell me that the discussion about the relationship of a totalitarian government to a democracy to that child and his family, this community and that community, how any of that has been advanced by the coverage. I'll tell you what has been advanced. For the most part, for those outside this community and the media, what has been advanced is a slight uptick they hope in what it is they are getting in a diminishing media with an audience increasingly appalled by what media do. In a list of 20 journalistic values, this illustrates again that compassion is roughly 55th, and this is the main problem about this coverage.

TERENCE SMITH: Susan Candiotti, let me ask you as someone who is there day in and day out, does the presence of the media change the story? In other words, would it be different if there weren't all the cameras there? Does some of the story - some of the demonstrators, do they appear because the cameras are there? What effect does the media have on it?

SUSAN CANDIOTTI: Well, certainly as recently as this day, a few hours ago a group of about 80 people broke down police barricades and shouted and chanted in front of the home, and the cameras rushed forward and took their pictures. It was hard not to miss that. As soon as the cameras pulled back after this had gone on for several minutes - and the crowd did indeed back off too. But I must say, you know, we really have not been here day in and day out. There have been fluctuations. As news warranted at least we at CNN have tried to regulate our camera presence here accordingly. For example, we have been part of a media pool that the family was very much aware of and had no objection to from the very beginning, whereby we had a single camera here to watch the house because there had been reports -- in fact -- that someone might try to either snatch the boy or that the family themselves might move the boy someplace else so that he could not be returned to his father in Cuba. And then as developments warranted it, we would come here and spend more time at the home, but it's also important to show I think by our presence here what has been going on outside -- to show the circus atmosphere that at times has arisen. That is part of the story because, of course, all sides are using this child, both forces that belong to the Cuban government, the family themselves and even the U.S. Government. So everyone has got to play, everyone has a piece of this child, and while we see him happily playing outside the relatives tell us that she crying inside, that he doesn't want to go home. It's difficult to say what is going on in the mind of a child so young while all this is going on around him.

TERENCE SMITH: And that's his home right there that you see. Mark Seibel, I know that you feel that the coverage is justified, and yet I want to read you a quote from Karl Highsen, the columnist who wrote in your newspaper "we in the media are such self-important blockheads," he wrote, "that we don't recognize our role in screwing up Elian Gonzalez's life. The fact that we're being played for suckers by a couple of hundred noisy zealots has conveniently escaped our attention." Has it?

MARK SEIBEL: Well, I don't think it has at all. I mean, we're very concerned, you know, of course I work for a newspaper. We have the ability to stand back and not have to have a lot of camera equipment. But you know, we went through a period where we didn't send anybody to the house, and we went through a period where we didn't make any effort to contact the family or to talk to the boy or any of those sorts of things. We've always worked through their spokesman, their lawyers, you know and there is a lot of those. I mean they have a professional spokesman who is very well known here, and seven attorneys. So there is lots of ways to talk to the family without actually having to talk to the family. We did a piece early on about the problem that the whole media coverage and the event itself had had for the family. I mean, they couldn't cook dinner because the lawyers had all their files stacked up on the stove so it was -- you know - I mean, we've done those kind of stories and we do worry about that. But in the end, you know, when we talk about media exploitation of a problem, I mean I think Susan is right to raise the point of who puts the kid on their shoulders of somebody and walks him around or, you know, when they come back from the visit with the grandmothers, who brings the child out in front so all the cameras can take a picture of him and who taught him to make a victory sign for the cameras? I mean, you know, I'm not sure where the exploitation is really the media's or where it's somebody else's. I mean, I think the media needs to be sensitive to the moments when we're being used and manipulated and that is our responsibility. But in the end we have a story that is dramatic by its nature. A child survives 50 hours in an inner tube at sea. It is dramatic in the emotions of the political situation that he gets immersed in in Miami. It's dramatic because it involves the highest officials of two countries and involves international law and state law and family custody matters, and it goes back to the 1996 Immigration Reform Act, which has given the INS incredible powers in this case. So there are lots and lots of things that go into this story, and because it involves a six-year-old boy, I don't think we cannot write about it. I think we do have to have some compassion for the child, but I don't feel that we put the child in that situation.

TERENCE SMITH: All right. And it's obviously far from over. Thank you -- all four of you -- very much.

RECAP

RAY SUAREZ: Again, the major stories of this Tuesday: It was a wild day on Wall Street. The NASDAQ Index and the Dow Jones Industrial Average lost about 500 points apiece before regaining most of the losses. And demonstrators in Miami broke through police barricades at the home where Elian Gonzalez is staying with relatives. They said they would keep him from being returned to Cuba. An editor's note before we go about a "Frontline" documentary airing tonight on most PBS stations. "Dr. Solomon's Dilemma" looks at doctors struggling with both quality and the bottom line in today's health care system. Please check for the time in your area. We'll see you online and again here tomorrow evening. I'm Ray Suarez. Thanks and good night.