The MacNeil/Lehrer NewsHour (PBS) - 1992-03-12
Channel: malgent
Transcript
Language: English (original, YouTube automatic captions)
[0:02] [music]
[0:06] Good evening. I'm Judy Woodruff in New
[0:08] York.
[0:09] >> And I'm Jim Lara in Washington. After
[0:11] our summary of the news this Thursday,
[0:13] we hear four views of the new Nixon call
[0:16] for the West to help Boris Yelson
[0:18] succeed in Russia and get the economic
[0:20] opinions of Nobel Laureate Milton
[0:23] Freriedman.
[0:24] >> Funding for the McNeel NewsHour has been
[0:27] provided by Pepsico.
[0:30] >> [music]
[0:36] [music]
[0:40] >> Testico. [music]
[0:43] Part of helping the world live and
[0:45] communicate better is keeping it well
[0:46] informed. That's why funding for the
[0:49] NewsHour is also provided by AT&T
[0:52] and by the Corporation for Public
[0:54] Broadcasting and viewers like you. The
[0:57] House of Representatives is moving
[0:59] toward revealing the names of all of its
[1:01] check bouncers. It is voting tonight on
[1:03] a plan that would name the 296 current
[1:07] and 59 former members who bounce checks
[1:09] at the congressional bank during a
[1:11] 39-month period ending last October.
[1:14] House Republicans had opposed an earlier
[1:17] Democratic proposal to identify only the
[1:19] 24 worst abusers. Today, the Democratic
[1:23] leadership gave in and allowed a vote on
[1:25] full disclosure. This afternoon, House
[1:28] Speaker Tom Foley said revealing the
[1:30] names could be unfair to some members
[1:32] because of the way the bank was run.
[1:35] >> It's functioned as a payroll office
[1:37] which allowed members to draw against
[1:39] their payroll checks and to some against
[1:42] payroll already earned in the next
[1:44] month. One of the serious problems with
[1:48] uh the operation of the bank was that in
[1:51] many cases uh members were not notified.
[1:54] Any overdrafts were not noted on their
[1:56] monthly statements. They were completely
[1:58] unaware that their checks were being
[2:00] held in many cases in some cases
[2:03] deposited were credited on time leading
[2:05] to overdrafts that otherwise wouldn't
[2:07] have occurred in a commercial banking
[2:09] operation. In economic news, retail
[2:12] sales were up 1.3% in February, the
[2:15] Commerce Department reported today. It
[2:18] also revised its January figure, sharply
[2:21] upward to nearly four times the gain it
[2:23] had originally reported. But firsttime
[2:26] unemployment claims continued to rise.
[2:28] The Labor Department said today they
[2:30] were up 22,000 the last week in
[2:32] February. Judy,
[2:34] >> the United Nations Security Council told
[2:36] Iraq today it had failed to comply with
[2:39] the Gulf War ceasefire agreement. It
[2:41] ordered Iraq to do so immediately and
[2:44] unconditionally. The UN body rejected an
[2:46] appeal from Iraqi Deputy Prime Minister
[2:49] Tariq Aziz to modify the agreement. Aziz
[2:52] said Iraq intended to make a full
[2:55] disclosure of its weapons program and to
[2:58] meet all other UN demands. But he also
[3:00] said some of those demands should be
[3:02] changed because they infringed on Iraqi
[3:05] sovereignty. That drew a sharp response
[3:08] from US Ambassador Thomas Pickering.
[3:11] Once again there is broad and general
[3:13] acceptance of a resolution but with all
[3:16] kinds of new provisos reservations uh
[3:20] preconditions and so forth. I am left
[3:23] with the final and unfortunate
[3:25] conclusion that with respect not only to
[3:28] weapons of mass destruction but to all
[3:30] the other elements of the resolution
[3:32] including the very important
[3:34] humanitarian elements we are once again
[3:37] in a cat and mouse game uh that there is
[3:41] every willingness to discuss at great
[3:43] length uh but no willingness to accept
[3:46] the need for compliance much less to
[3:49] begin the actions to comply. I think
[3:52] this is unfortunate. As I said
[3:53] yesterday, I believe it is a
[3:55] miscalculation.
[3:57] Uh and I hope that that miscalculation
[4:00] uh doesn't continue. President Bush and
[4:03] Jordan's King Hussein today agreed on
[4:06] the importance of full Iraqi compliance
[4:08] with the UN ceasefire terms. But US
[4:10] officials said there was evidence Jordan
[4:13] had allowed embargoed products to reach
[4:15] Iraq. The US wants sanctions to stay in
[4:18] effect until Saddam Hussein is out of
[4:21] power. Mr. Bush and King Hussein also
[4:23] discussed the M East peace talks. The
[4:26] two men met this morning at the White
[4:28] House. It was their first meeting since
[4:30] the Gulf War when relations were
[4:32] strained by Jordan's siding with Iraq.
[4:35] Today, Mr. Bush indicated those problems
[4:38] were behind them.
[4:39] >> I'm just delighted
[4:41] uh to see his majesty again.
[4:44] For years, we've had
[4:47] strong relations with Jordan. We know
[4:49] there were difficulties. Uh he is my
[4:52] friend and I welcome him back here. And
[4:55] I might point out in a positive way uh
[4:58] that Jordan has taken a very courageous
[5:00] and forthright position on on the peace
[5:03] talks recognizing we should talk for
[5:06] peace and we want to develop more on
[5:08] that talk more about that. So we're
[5:10] looking to the future. Israel today
[5:13] flatly denied a report that it has
[5:16] shared Patriot missile technology with
[5:18] China, but the Associated Press said the
[5:21] Bush administration was investigating
[5:22] the report despite the denial. The
[5:25] Patriot was used during the Gulf War to
[5:28] intercept Iraqi Scud missile attacks on
[5:30] Saudi Arabia and Israel. The US gave
[5:33] Israel two Patriot launchers and several
[5:36] dozen missiles during the war.
[5:38] Meanwhile, Syria's president denied
[5:41] today that his country is getting a
[5:42] shipment of powerful Scud missiles from
[5:45] North Korea. A freighter allegedly
[5:47] carrying the missiles evaded US Navy
[5:50] ships and docked in an Iranian port
[5:52] earlier this week. North Korea's vice
[5:55] president today also denied a US charge
[5:58] of the missile shipment.
[5:59] >> Russia's new ambassador to the United
[6:01] States said today his country was not
[6:03] looking for charity. Ambassador Vladimir
[6:06] Lukan said his government understood the
[6:08] tough economic and political times in
[6:10] the United States, but he said Russia
[6:12] needed help in making a smooth
[6:14] transition to democracy. CIA director
[6:17] Robert Gates said today Russian
[6:18] President Boris Yelson was vital to the
[6:21] future of Russian democracy. He spoke at
[6:23] a Washington conference sponsored by
[6:25] former President Nixon.
[6:26] >> Boris Yelson comes as close to being
[6:28] indispensable
[6:31] uh as anyone uh can imagine.
[6:35] He has about 40% by our judgment about
[6:38] 40% popular support uh in Russia, but he
[6:43] has a feel for the pulse of the Russian
[6:46] people that we think no other political
[6:48] leader there has.
[6:50] He has a sense of what the public can
[6:54] stand
[6:55] before he has to back away a little bit.
[6:58] >> We'll have more on the Russian story
[7:00] right after this news summary. Ukraine
[7:02] has halted the transfer of nuclear
[7:04] weapons to Russia. The former Soviet
[7:06] Union's weapons were being shipped for
[7:08] dismantling. Ukrainian President Leoned
[7:10] Krabchuk said he wants firm guarantees
[7:13] they will be destroyed and not
[7:15] redeployed by the Russians. He said
[7:17] Western nations could help Ukraine build
[7:19] a nuclear dismantling facility of its
[7:22] own. Russia's vice president said today
[7:25] some nuclear weapons remain based in the
[7:27] waring republics of Armenia and
[7:29] Aaraijan. They are fighting over control
[7:32] of a disputed region, Norno Carabach. A
[7:35] new ceasefire was declared overnight,
[7:37] but it did not last long. We have a
[7:39] report narrated by David Simmons of
[7:41] Worldwide Television News.
[7:46] The ceasefire agreement came to an end
[7:48] when 30 rockets landed on ADAM, an Azeri
[7:51] city close to the disputed territory of
[7:52] Nagono Karabak.
[7:58] At least 25 people were killed and many
[8:01] others were wounded and left homeless.
[8:04] The shelling continued for most of the
[8:06] day and many people fled to safer areas.
[8:10] Azeri officials said Armenian troops had
[8:12] launched the attack, but the Armenians
[8:14] denied targeting Abdam and accused
[8:16] Aabaijan of attacking their town. More
[8:19] than a thousand people have been killed
[8:21] in this bloody 4-year conflict. Earlier,
[8:24] the former Soviet army soldiers
[8:25] kidnapped by Armenian militants were
[8:27] released. They looked tired and bruised,
[8:29] but otherwise unharmed. They were
[8:31] captured last weekend during an attack
[8:33] on a Commonwealth military base in
[8:35] Armenia and held hostage by militants
[8:37] demanding weapons and ammunition. Former
[8:40] Soviet bases have become favorite
[8:41] targets for both sides, desperate to
[8:44] increase their military arsenal. In
[8:46] Moscow, the Russian vice president
[8:48] confirmed that the waring republics
[8:49] still have nuclear weapons on their
[8:51] territory. He said the weapons were
[8:53] 1,000% safe from capture, but added that
[8:55] they should be withdrawn.
[8:57] >> And that's it for the news summary
[8:58] tonight. Now, it's on to the Nixonian
[9:01] argument over helping Russia and an
[9:03] economics conversation with Milton
[9:05] Friedman.
[9:08] [music]
[9:17] Richard Nixon's call for help is our
[9:19] lead story tonight. He sounded it in a
[9:22] memo and then in a Washington speech on
[9:24] behalf of the newly independent Republic
[9:26] of Russia. A full debate follows this
[9:29] backgrounder bywami homeman. President
[9:32] Nixon made his major policy speech
[9:34] yesterday at a foreign affairs
[9:35] conference sponsored by the Nixon
[9:37] presidential library. He repeated the
[9:40] warning from his widely publicized memo
[9:42] that the US was missing an historic
[9:44] opportunity by turning its back on
[9:46] Russia. Freedom is on trial. And if
[9:50] freedom does not work, the Russian
[9:52] people are not going to return to
[9:53] communism because it failed. But they
[9:56] will return, in my view, to what I would
[9:59] call a new desperatism in which they
[10:02] trade their freedom for security. This
[10:04] new desperatism which would be shorn of
[10:07] the dying faith, the baggage of the
[10:09] dying faith of communism. this new
[10:12] desperatism which would have the
[10:14] overtones of imperialist Russian uh
[10:19] activities which have been traditional
[10:20] in Russian history. That new desparatism
[10:24] could be a far more dangerous threat to
[10:26] peace and freedom in the world and
[10:28] particularly the peace uh than was the
[10:30] old Soviet totalitarianism.
[10:33] So what do we find Russian? We find that
[10:36] Yelston is the most pro-western
[10:40] leader in Russian history.
[10:43] Under those circumstances, then he
[10:46] deserves our help. What does he need? He
[10:50] needs a number of them. Uh just to tick
[10:52] off a few of them. Uh he needs, for
[10:55] example, help from the IMF and other
[10:57] sources. Uh and that will take billions
[11:00] of dollars to stabilize Aruba. He he
[11:03] needs more open markets for the exports
[11:06] which Russia would want to make the new
[11:08] Russia to the west and to other parts of
[11:10] the world.
[11:11] >> President Nixon acknowledged that aid to
[11:14] Russia would be costly, but he said it
[11:16] would be much cheaper than cold war
[11:18] spending. The New York Times and its
[11:20] editorial today estimated that that the
[11:23] cost of the aid to cover some of these
[11:26] items that I have mentioned and others
[11:28] would be approximately $20 billion a
[11:31] year over a period of five years. That's
[11:33] a great deal of money. However, the the
[11:36] London Financial Times in its report
[11:38] yesterday pointed out that $20 billion a
[11:42] year has to be compared with 20 times
[11:45] that much that the West spent even last
[11:48] year before the collapse of communism to
[11:51] defend against the Soviet communism. So,
[11:54] under the circumstances, this puts it
[11:56] all in perspective. Reflecting on his
[11:59] early days as a congressman, President
[12:02] Nixon described the political courage of
[12:04] then President Harry Truman. All of the
[12:06] pollsters are telling their candidates,
[12:10] "Don't tackle foreign policy and
[12:13] particularly not foreign aid because
[12:15] foreign aid is poison as a political
[12:18] issue."
[12:20] They're wrong and history proves it. I
[12:24] remember as if it were yesterday, Harry
[12:26] Truman, jaunty, some said a little
[12:28] cocky, coming down before a joint
[12:31] session of the Congress and asking for
[12:32] millions of dollars in aid to Greece and
[12:35] Turkey to prevent communist subversion
[12:39] and possibly communist aggression.
[12:43] It was a very tough vote for two very
[12:46] young and both as late as history later
[12:50] indicated rather ambitious young
[12:52] congressman.
[12:54] The liberal Democrats in Jack Kennedy in
[12:56] Jack Kennedy's Massachusetts district
[12:59] were against any military foreign aid
[13:03] and the conservative Republicans in my
[13:05] California district were against all
[13:07] foreign aid.
[13:09] Under the circumstances, however, after
[13:11] considering it, we both voted for it
[13:14] and a majority in the House and the
[13:16] Senate and that Republican House and
[13:18] Senate voted for that program and that
[13:21] was the program which later was
[13:23] developed into the Marshall Plan and
[13:25] later into NATO which not only contained
[13:28] communism but bought the time that was
[13:31] essential for communism to fail as it
[13:33] inevitably fa did fail last year not
[13:36] only in the so in the Soviet Union as
[13:38] well as of course in Eastern Europe.
[13:39] three years before.
[13:40] >> Last night, President Bush addressed the
[13:42] same audience and was consiliatory.
[13:45] >> For the third time this century, we've
[13:48] emerged on the winning side of a war,
[13:50] the Cold War, involving the great
[13:52] powers. And so, the question before us
[13:55] is the same. Have we won the war?
[13:59] But but are we prepared
[14:02] to secure the peace? And that is the
[14:05] challenge that we must face.
[14:08] And yet already there are voices across
[14:10] the political spectrum calling in some
[14:12] cases shouting uh for America to come
[14:15] home, gut defense,
[14:20] spend the peace dividend,
[14:22] shut out foreign goods, flash foreign
[14:26] aid.
[14:27] You all know the slogans. You all know
[14:30] the so-called solutions, protectionism,
[14:33] isolationism.
[14:34] But now we have the obligation,
[14:37] the responsibility to our children to
[14:40] reject the false answers of isolation
[14:42] and protection, to heed history's
[14:45] lessons, and turning our back on the
[14:48] world is simply no answer. I don't care
[14:51] how difficult our economic problems are
[14:55] at home. The successor republics are
[14:58] still struggling to establish themselves
[15:01] as democracies,
[15:03] still struggling to make the transition
[15:05] to capitalism.
[15:07] And we invested so much to win the Cold
[15:09] War. We must invest what is necessary to
[15:13] win the peace.
[15:15] >> But at a news conference earlier
[15:16] yesterday, the president spoke more
[15:18] bluntly about the political and fiscal
[15:20] realities involved in aiding the former
[15:23] Soviet Union. We're living in a in a
[15:25] time of constrained resources. There
[15:28] isn't a lot of money around. We are
[15:31] spending too much as it already is. So,
[15:34] to do the things I would really like to
[15:35] do, uh, I don't have a blank check for
[15:38] all of that. Aid to Russia was the
[15:40] administration's theme of the day on
[15:42] Capitol Hill as well. Deputy Secretary
[15:45] of State Lawrence Eagleberger echoed the
[15:47] president's sentiment before a House
[15:49] Appropriations Subcommittee. President
[15:51] Nixon doesn't have to worry about budget
[15:54] caps and taxation and other issues that
[15:58] you have to worry about every day and
[15:59] that to a great degree we have to worry
[16:02] about. And uh so he's arguing if I and I
[16:06] have the greatest respect for the
[16:08] president, President Nixon, but
[16:10] >> he's arguing in a vacuum.
[16:12] >> Robert Strauss, US ambassador to Russia,
[16:15] appeared before the Senate Foreign
[16:16] Relations Committee. Strauss said he was
[16:18] amazed at the lack of attention the
[16:20] Russian crisis is getting in this
[16:22] country.
[16:22] >> When you come from the world that I left
[16:25] it, it's just it's just shocking to
[16:28] think that you're so wrapped up and
[16:29] think the whole world is revolving
[16:31] around what you're doing and find out
[16:33] that it isn't worth two cents worth two
[16:36] cents or two seconds on the evening news
[16:40] when they take signs sign bites out of
[16:42] candidates presentations.
[16:45] Now to our debate. Senator Sam Nun,
[16:47] Democrat of Georgia as chairman of the
[16:49] Senate Armed Services Committee. He just
[16:51] returned from a visit to Russia and
[16:53] Ukraine. Senator Malcolm Wallup,
[16:55] Republican of Wyoming, is also a member
[16:57] of the Armed Services Committee. Fred
[17:00] Star is president of Oberlin College in
[17:02] Ohio. He's a longtime scholar of US
[17:04] Soviet affairs. He joins us tonight from
[17:06] Cleveland. Steven Cohen is a professor
[17:09] of political science at Princeton
[17:10] University. He's the author of the book
[17:12] Rethinking the Soviet Experience.
[17:16] Senator Nun, Mr. Nixon says the West is
[17:18] at risk of snatching defeat in the Cold
[17:20] War from the jaws of victory. Is he
[17:23] right? I think President Nixon is
[17:25] entirely correct. I think we have not
[17:28] focused on this whole opportunity and
[17:31] danger nearly as much as we should and
[17:33] I'm glad that he has helped focus
[17:35] attention. Some of us have been talking
[17:38] about this subject uh in similar terms
[17:40] since last September and October. We got
[17:43] some things done at the end of Congress,
[17:44] but not nearly as much as we should.
[17:47] Money is involved, but this is not
[17:49] really foreign aid in the conventional
[17:51] sense. It's much more a national
[17:54] security expenditure because if we do
[17:56] not help now do de democracy to succeed
[18:00] and if democracy fails there then we're
[18:02] going to be spending hundreds of
[18:04] billions of dollars defending against
[18:05] the aftermath in proliferation and in
[18:08] ethnic conflicts in that part of the
[18:10] world. Did you see anything or any
[18:12] series of things on your visit just uh
[18:15] last weekend uh in into Russia that made
[18:19] you feel even more urgent about doing
[18:22] something about this? It reflects on the
[18:24] ground what what you and President Nixon
[18:27] and others have been saying
[18:28] rhetorically.
[18:29] >> Yes. Uh Jim, two things come to mind in
[18:32] that respect. One is the economic window
[18:34] of opportunity. We have been urging the
[18:37] Russians in particular to bite the
[18:39] bullet to get their ruble under control
[18:42] and to help stabilize their currency.
[18:45] And now they have done that. Their
[18:47] currency for a brief time now has been
[18:50] stable only about three or four days.
[18:52] But it is it has moved down from 150
[18:55] rubles to the dollar to about 80. The
[18:58] reason is because their government has
[18:59] dramatically cut their expenditures.
[19:02] They've cut at least 75% of all orders
[19:05] for production, including defense
[19:06] production. They have cut the subsidies
[19:08] and therefore they've quit printing as
[19:10] much money. Now, this is not going to
[19:12] last long. They're not going to nibble
[19:13] on that bullet very long unless the West
[19:15] comes up with a fund to back up this and
[19:18] to help stabilize. That is one thing
[19:21] that is absolutely crucial very quickly.
[19:23] The other thing that I would point out
[19:25] that we can perhaps discuss further is
[19:27] the Ukrainian situation. They were along
[19:30] the road of an unprecedented move to get
[19:33] rid of all nuclear weapons. To my
[19:35] knowledge, no other country has ever
[19:36] done that that possessed nuclear
[19:38] weapons. They had started and were well
[19:40] along in dismantling or shipping out for
[19:43] dismantlement about 60% of the tactical
[19:46] nuclear weapons. And we were hoping to
[19:47] accelerate their move away from
[19:49] strategic nuclear weapons. Just today we
[19:52] heard what we feared we were going to
[19:54] hear, although we didn't think it would
[19:55] be this soon. that is they are going to
[19:58] hold back those tactical nuclear weapons
[20:00] uh and not send them to Russia. Two
[20:02] reasons for this. One is I don't think
[20:04] we in the west not just the US but
[20:07] others have paid nearly enough attention
[20:09] to what they have they were doing. We
[20:11] had not have not given them the kind of
[20:13] political attention they felt they
[20:15] deserved. And uh second, I think that
[20:18] it's it's very important to note that if
[20:20] they do not uh continue to send these
[20:23] weapons, we're going to have major
[20:24] problems with START with the
[20:26] non-prololiferation treaty and the whole
[20:29] weapon disposition and dismantling is
[20:32] going to be held up and this may set a
[20:34] very bad example. So those are two
[20:36] things that are urgent and we need to
[20:39] pay attention to them.
[20:39] >> We'll come back to the Ukraine thing uh
[20:41] if we have time at the end, but back to
[20:43] Russia. Senator Wallup, uh,
[20:45] specifically, do you support what
[20:48] Senator Nun and President Nixon and
[20:50] others are saying that the United States
[20:52] must lead the way in real terms, in real
[20:54] financial terms to stabilize the ruble
[20:57] and spend and help spend or help help
[21:00] Russia get up to $20 billion a year for
[21:03] 5 years or whatever it takes.
[21:05] >> Well, no, not whatever it takes. I do
[21:08] agree with President Nixon that our
[21:10] policy has been minimalist and and uh
[21:13] and what might best be described as
[21:15] Russoentric. I I think uh we we are
[21:18] paying almost exclusive attention to to
[21:21] Russia trying in some way to recreate
[21:24] the Soviet Union now that it's gone. But
[21:26] that problem with governments is that
[21:28] they can only think in terms of
[21:30] government solutions to these things.
[21:32] There is within Russia, within the
[21:36] republics, within the Commonwealth of
[21:38] Independent States, which I do not
[21:40] expect to last, there are certain
[21:43] natural resources which could today
[21:45] provide them with the basis of
[21:47] stabilizing the ruble or in the case of
[21:50] Russia probably within by midsummer
[21:54] private business deals could could take
[21:56] care of uh say probably 50 to 70% of
[22:01] their outstanding standing for in debt.
[22:04] What we are not focusing on as a as a
[22:07] country in addition to the lack of
[22:09] policy uh in any way is all those things
[22:12] which America can do. The state
[22:13] department is in much many many respects
[22:15] standing in the way of uh of a free flow
[22:19] of commerce between our our countries.
[22:22] >> You mean that there there are private
[22:24] solutions that the government if it just
[22:27] got out of the way could could help
[22:28] Russia? private solutions that the
[22:30] government not should get out of the way
[22:31] but should encourage. Uh one of the
[22:34] problems that we have is that we have
[22:36] taken a very able ambassador with very
[22:38] able skills in the petroleum industry
[22:40] and told him that he may not talk uh to
[22:44] Russians, Americans or anybody else
[22:46] about those things for fear of a
[22:48] conflict of interest. And what we are
[22:50] denying
[22:51] um to the Russians and denying to
[22:54] Americans is very very badly needed
[22:57] skills in how to put together the kinds
[22:59] of deals that would attract the foreign
[23:02] capital that are necessary to uh to
[23:05] reestablish that industry. Dr. Star, the
[23:09] the threat as outlined by uh President
[23:12] Nixon, to read a quote from him is is as
[23:15] follows. A new and more dangerous
[23:17] despatism will take power with people gr
[23:22] granting freedom, giving up freedom for
[23:24] security and entrusting their future to
[23:26] old hands with new faces. Is is that the
[23:30] way you see it? Is it that dangerous
[23:31] over there now? I don't I think that's
[23:35] excessively apocalyptic. We've had
[23:38] various grim scenarios. None of them
[23:40] have come to pass. I think what his
[23:42] speech missed was the real sense of
[23:46] economic opportunity there. It's fine to
[23:48] talk about private investment over
[23:51] there. We're the only major industrial
[23:53] country without a trade treaty with
[23:55] Russia. We're the only ones without a a
[23:58] good uh export agreement, export credit.
[24:02] All kinds of things that facilitate
[24:04] trade that governments do, we have yet
[24:07] to do. Now what we're doing is creating
[24:10] a unlevel playing field for oursel over
[24:13] there. We complain about the Japanese
[24:15] and problems of competitiveness but in
[24:18] fact they are already more active in
[24:21] Russian trade than we are. And that
[24:23] trade helps develop the country and
[24:25] prevent the crisis that everyone's
[24:28] worried about. But you don't see the
[24:30] threat from uh uh the old line
[24:34] hardliners and all of that to Yelson if
[24:37] he doesn't move, if these reforms don't
[24:38] work quickly and whatever. Obviously,
[24:41] it's dangerous, but how many times have
[24:44] we used these threats as excuses for not
[24:47] doing anything? Let's see if Yeltson
[24:49] survived. Well, he's brought about more
[24:51] domestic change in in six months than
[24:54] Gorbachev did in six years. Uh it seems
[24:57] to be working. Uh the country didn't go
[25:00] up in civ civil unrest at the price
[25:03] reforms. They didn't have a military
[25:06] coup. None of these things has happened.
[25:08] Let's give them the benefit of the
[25:10] doubt. Let's get behind it. Not through
[25:12] just handouts, but opening up channels
[25:15] for trade. We're way behind the
[25:16] Europeans and Japanese on this. Steve
[25:19] Cohen. Another major point of President
[25:23] Nixon is that that Boris Yeltson is the
[25:27] horse to back and that he is a
[25:30] Democratic leader. He deserves uh this
[25:32] attention. He deserves everything every
[25:34] bit of help that we can give him. Do you
[25:36] agree with that?
[25:37] >> I I I certainly agree he deserves help.
[25:39] I think to formulate a policy in terms
[25:41] of of Yeltson is exceedingly
[25:43] shortsighted. Any hope for real markets
[25:47] and real democracy in Russia is a matter
[25:50] of a generation, not of one winner of
[25:51] five years. Yeltson won't last that
[25:54] long. He's 60 years old. He couldn't
[25:56] possibly. Uh we have a rare opportunity
[25:59] for one of the maybe the
[26:02] rarest opportunities in diplomatic
[26:04] history. We can do both the decent thing
[26:07] and the thing that's in our own national
[26:08] interest. That is help these people.
[26:10] Help these people in a large way. What
[26:12] President Nixon has said is we've done
[26:14] almost nothing given maybe 7% of the
[26:18] total aid that's gone to Russia over the
[26:20] last two or three years. Virtually
[26:22] nothing. And what I hear coming from
[26:24] your other guest is our are further
[26:26] recipes for delay. We simply must act.
[26:28] It's a decent thing to do. It's a
[26:30] national security thing to do. But
[26:31] there's a danger here, too. I think
[26:33] President Nixon is wrong in saying that
[26:35] Russia is ours to win or lose. We can't
[26:38] win or lose democracy or capitalism or
[26:40] markets in Russia. That destiny,
[26:42] Russia's destiny will be decided there
[26:44] by political forces. And here we come to
[26:46] the alternative. Anti-Western political
[26:48] forces are exceedingly strong in Russia
[26:51] today. Exceedingly strong
[26:54] social pain, the pain that people feel,
[26:57] particularly the very old and the very
[26:58] young, in any process toward markets,
[27:02] that that pain strengthens anti-western,
[27:04] anti-liberal, anti-democratic political
[27:07] forces in Russia. We can't change that
[27:09] struggle, but we can at least on the
[27:12] margins reduce the very great odds that
[27:15] are against a happy outcome in Russia.
[27:17] And if we don't do it, uh, historians
[27:20] will certainly condemn it a generation
[27:22] from now.
[27:24] >> Back to the senators, uh, Mr. Nixon uh
[27:26] made this point or or or made the case
[27:29] at least that while it may look
[27:32] difficult in domestic political terms
[27:34] right now that in the long run the
[27:36] United States and its political leaders
[27:38] have no choice but to move now and show
[27:40] some leadership and take the do the
[27:42] courageous thing. You agree, Senator
[27:44] Nun?
[27:45] >> Yes. I think we'll be judged in history
[27:47] by this and I I think that President
[27:49] Bush for instance could end up winning
[27:50] this year's election but losing his
[27:52] place in history unless he takes a more
[27:55] vigorous and energetic lead. Uh I think
[27:57] we all are going to be held accountable
[27:59] because even though people right now in
[28:01] this country certainly want to
[28:03] concentrate on our domestic problems and
[28:05] we have plenty of those to concentrate
[28:07] on, I think that they will uh hold us
[28:10] accountable in a couple of years if
[28:11] things start going badly wrong there.
[28:13] Senator Wallup, could you make that case
[28:15] to the people of Wyoming for major uh
[28:18] economic aid to Russia in our economic
[28:20] times right now?
[28:22] >> I I could, but not until we had done
[28:24] other things. And I disagree completely
[28:26] with Professor Cohen that that any of
[28:30] the pre previous speakers, frankly, were
[28:32] providing recipes for delay. There is a
[28:35] lot of anti-western sentiment, but there
[28:38] is far more pro-western, pro- US
[28:40] sentiment over there. And what we need
[28:42] to be able to do is Dr. Star said, is to
[28:46] begin to open the avenues for for trade
[28:49] intercourse, diplomatic intercourse,
[28:52] economic intercourse that are just
[28:54] simply not part of the State
[28:56] Department's plan at this moment in
[28:57] time.
[28:58] >> Jim, Dr. Yeah, Jim, let me just give you
[29:00] one example on what Malcolm is talking
[29:02] about. I think it's a very good example.
[29:05] Uh, and that is the question of
[29:06] diplomatic representation. And this is
[29:08] not much money involved, but the Ukraine
[29:10] has 50 million people. We have a total
[29:12] of seven people there. 50 million
[29:15] country. We have seven people. We have
[29:17] 35 people in the consulate in St.
[29:19] Petersburg covering an area of 2 million
[29:21] people. We are, as Malcolm said,
[29:24] entirely centered on Russia. That's uh I
[29:27] think a mistake. We should be centered
[29:28] on Russia as well as the other
[29:30] republics. And I also agree very
[29:32] strongly with the notion of facilitating
[29:35] American investment. We need to help our
[29:37] business people by such simple
[29:39] inexpensive things as clearing visas
[29:41] much more priority by accelerating the
[29:45] export licensing procedures by having a
[29:48] trade fair to look at their technology.
[29:51] There are a lot of things we can do
[29:52] without spending much money at all. So
[29:54] it's not a matter simply of large
[29:56] amounts of economic help. One other
[29:58] thought on the whole Western IMF World
[30:01] Bank need to stabilize. This money
[30:03] should be a reserve fund. it will not
[30:05] hopefully be spent because if it it has
[30:07] to be spent stabilization hasn't worked
[30:10] and we can also inject the whole notion
[30:12] of security and collateral into this
[30:14] overall assessment. Dr. Star, what's the
[30:17] problem from your perspective? Why is
[30:19] this message why why is more not being
[30:21] done? Why all the all the things the
[30:23] senators have said and that that that
[30:26] Professor Cohen said at all that could
[30:28] be done, why is it not being done? Why
[30:29] did Richard Nixon have to be the one to
[30:32] uh to write the memo and draw attention
[30:34] to this issue right now in the United
[30:36] States?
[30:38] I think we're tired. I think we're
[30:40] jaded. We waited around for things to
[30:43] happen six years and not much happened
[30:45] domestically there. Suddenly it breaks
[30:47] through and we're in a recession and and
[30:50] we're just we're just passive at the
[30:53] moment. We should be active because we
[30:54] don't appreciate the opportunity that
[30:56] this presents to us. Is it an
[30:58] opportunity to avoid chaos or is it a
[31:01] positive opportunity?
[31:02] >> It really is a positive opportunity.
[31:04] This is a huge economy. They have
[31:06] resources, incredible resources in
[31:09] including human resources. Obviously,
[31:12] they're going to make it in the long
[31:13] run. Why shouldn't we be part of that
[31:16] development? We're obviously going to be
[31:19] competing with the Europeans, with the
[31:21] Japanese for that trade. You know, why
[31:25] should we
[31:27] talk about competitiveness
[31:29] in one part of the world and not
[31:31] practice it when we have an invitation
[31:33] in another part of the world? It's
[31:35] baffling to me. Our business people have
[31:37] been amazingly passive. What is your
[31:40] analysis of that, Steve Cohen, as to why
[31:42] the US response in all levels, uh,
[31:45] business, government, whatever, has been
[31:47] passive, if you agree?
[31:48] >> Well, it's the administration is clearly
[31:50] driven by political considerations in a
[31:52] presidential year. It's not a popular
[31:53] issue and nobody in the administration
[31:55] wants to explain to the American people
[31:56] that it's in our in our national
[31:58] interest. But let's bring out the dirty
[32:00] linen. There's also a strong point of
[32:03] view, maybe not in the White House, but
[32:04] certainly in the administration, that
[32:06] it's in America's national interest not
[32:08] to allow Russia to recover too firmly or
[32:11] too quickly. that Russia has always been
[32:13] a minister to Europe to her neighbors
[32:14] and that we should not be so eager to
[32:16] see a recovered powerful European Russia
[32:19] which is what she's likely to become in
[32:21] the case of reform. Let me add one other
[32:23] thing. It's an absolute myth to say that
[32:26] this is expensive. If we take the most
[32:28] grandiose programs that are being
[32:30] proposed,
[32:32] uh we're talking about an annual
[32:33] American contribution over 5 years of 2
[32:36] to3 billion. I believe that's around 1%
[32:40] of our defense spending at the moment.
[32:42] That is the cheapest national security
[32:45] you could ever possibly buy. We are not
[32:47] talking about a lot of money.
[32:49] >> All right, gentlemen. We have to leave
[32:51] it there. There's much more that needs
[32:52] to be said and we will say it at another
[32:54] time. Thank you all four very much.
[32:57] >> Still ahead on the NewsHour, a
[32:59] conversation with Nobel Prize winner
[33:01] Milton Freriedman about the state of the
[33:03] US economy.
[33:04] But first is his pledge week on public
[33:07] television. We're taking a short break
[33:08] now so that your public television
[33:10] station can ask for your support. That
[33:12] support helps keep programs like this on
[33:15] the air.
[33:23] Good evening. You're probably watching
[33:25] the McNeel Larry NewsHour for the same
[33:27] reasons I do. Because McNeel and Larara
[33:29] take the time to explore a topic. You
[33:32] get more than just a gloss of the
[33:33] headlines. You get thoughtprovoking
[33:35] questions, in-depth analysis, and
[33:37] probing interviews about the matters,
[33:39] the news that matters to you. Good
[33:40] evening everyone. I'm Jack McGowan, and
[33:42] you won't find this commitment to
[33:43] information on most other news
[33:45] broadcast, but it's standard right here
[33:47] on your public broadcasting service,
[33:48] Oregon Public Broadcasting. If it's
[33:51] important to you, give us a call with a
[33:52] generous pledge tonight and show your
[33:54] support. For a $60 contribution, you'll
[33:57] receive a handsome OPB mug with its
[33:59] unique handet design. Or contribute $100
[34:02] and receive two mugs. Now, the call is
[34:04] free from anywhere in our viewing area.
[34:06] Call 1 8002452346.
[34:09] Or if you're calling from Portland, just
[34:10] call 2452345.
[34:14] >> Good evening. I'm Joan Biggs. When you
[34:16] call in to make a pledge to oversee,
[34:19] you're not just giving, you're also
[34:21] getting. In addition to 365 days a year
[34:24] of the programs you enjoy and depend on.
[34:26] You'll also get the added membership
[34:28] benefits of Oregon Focus magazine and
[34:30] your personalized OPB membership card,
[34:33] your ticket to Oregon. And here's what
[34:35] we mean.
[34:37] >> I'm Claudia Brown.
[34:38] >> I'm Mark Zusman. You watch the McNeel
[34:40] Lair NewsHour for its unique approach
[34:42] and because it's the only full hour of
[34:44] national and international news and the
[34:46] only nightly news at 7 p.m.
[34:48] >> OPB brings you McNeel Lair because you
[34:50] need and deserve more than 12 second
[34:52] sound bites, more than just sensational
[34:54] headlines. But OPB is a partnership and
[34:57] paying for programs like McNeel Larer,
[34:59] Washington Week and Review and Northwest
[35:01] Week calls for a commitment from the
[35:03] community, government, business, and
[35:06] from you, our most important partner.
[35:08] >> Tonight is your chance to make that
[35:10] commitment. Please call now and pledge
[35:11] your support for the McNeel Lair
[35:13] NewsHour and all the other programs you
[35:15] watch here every day. Thank you.
[35:18] Now, all you have to do is give one of
[35:20] our volunteers from the Portland
[35:22] Elementary Principles Association or
[35:24] Portland Sarity Market a call with your
[35:27] generous pledge now and you'll start
[35:29] enjoying all of the benefits that
[35:30] membership offers. Your contribution of
[35:33] $150 brings you a copy of the new book
[35:35] Feeding Frenzy, a timely research work
[35:38] into journalistic practices of exposing
[35:40] the private lives of politicians. In
[35:43] this current election year, many
[35:44] consider it a must-read book. The book
[35:47] is yours when you contribute $150 to
[35:49] OPB. If you're watching in Portland,
[35:51] call 2452345.
[35:54] And from anywhere else in our viewing
[35:56] area in Oregon and southern Washington,
[35:57] call toll-free 1-8002452346
[36:02] and make your pledge right now.
[36:05] >> I'm Bob Kellogg. And when you make a
[36:06] pledge to become a member of Oregon
[36:08] Public Broadcasting, we're joining
[36:10] together with others in our community
[36:11] who have made a commitment to keeping
[36:13] quality programming on the air. programs
[36:16] such as the Neil McNeel Lair NewsHour.
[36:18] Now, they don't just appear on your set
[36:20] for free, folks. OPB has to buy them and
[36:23] pay to broadcast them. Who pays? Well,
[36:26] OPB is supported in part by a
[36:28] partnership of corporations, local and
[36:30] federal government, foundations, and
[36:32] other groups. But the bulk of our cost,
[36:34] nearly 50% of our budget comes from
[36:36] viewers just like you.
[36:39] OPB has made a commitment to bringing
[36:41] you the best in information and
[36:43] entertainment. And we need you to make a
[36:45] commitment to OPB to ensure its
[36:47] continued survival. And whether you can
[36:49] contribute $150,160,
[36:51] or $35, you'll get all the membership
[36:53] benefits we showed you earlier to help
[36:55] you get the most from OTD. And no matter
[36:58] where you're watching, all you have to
[36:59] do is go to the phone and dial that
[37:01] number 1 8002452346.
[37:04] And if you're calling in Portland, the
[37:06] number is 2452345.
[37:09] >> The question is, how does it work? Well,
[37:11] we're always happy to take checks. But
[37:13] if you want to pledge to even be
[37:14] simpler, you can take your Mastercard,
[37:16] your Visa, Discover Card, American
[37:18] Express to the phone with you and charge
[37:20] your membership. Now, that saves OPB the
[37:23] printing and postage costs of billing
[37:25] you, which means that more of your
[37:26] dollars go straight to buying the
[37:28] programs you want to support. If you
[37:30] prefer, we can even break up your
[37:31] payment into easy easy monthly
[37:32] installments. The only thing simpler is
[37:35] the phone number and it's right on your
[37:36] screen now. Come on, give us a call. If
[37:38] you're calling from outside Portland,
[37:39] anywhere in Oregon or southern
[37:40] Washington, call toll-free 1 8002452345
[37:45] or 2452346.
[37:48] We're offering the special OPBE
[37:50] handetched mug as a reminder of your
[37:52] commitment to Oregon public broadcasting
[37:55] and it's yours with a contribution of
[37:56] just $60. If you contribute $100, we'll
[37:59] send you two mugs. You wouldn't be
[38:01] watching the McNeil Lair NewsHour if you
[38:03] weren't interested in what is going on
[38:05] in the world around you. I'm sure of
[38:06] that. Think of OPB as your window on
[38:09] that world. From late breaking news to
[38:11] in-depth commentary, from nature and
[38:13] science to music and dance, OPB brings
[38:16] it all back home right into your living
[38:18] room. And what does it cost to keep it
[38:20] coming? A $35 membership, just 10 cents
[38:23] a day, helps lay the foundation for
[38:25] another year of quality OPB programming.
[38:28] Please call now and help us bring the
[38:30] world to you. The Portland number is
[38:32] 2452345.
[38:34] And if you're calling from elsewhere in
[38:35] our viewing area, all of Oregon and
[38:37] Southern Washington, call toll-free
[38:40] 18002452346.
[38:44] >> Phones are starting to ring and that
[38:45] sounds good, folks. Thank you very much.
[38:47] You know, you learn a little more about
[38:48] the world every time you tune in to OPB.
[38:51] Whether it's you watching the McNeel
[38:52] Lara NewsHour or your children watching
[38:54] Sesame Street, you come away enriched.
[38:56] It can teach, inform, and inspire you.
[38:59] And that's what we set out to do with
[39:00] every program. If that's what you think
[39:02] television should be, then call and cast
[39:04] your vote right now. Please just dial 1
[39:06] 8002452346
[39:08] or in Portland 2452345
[39:11] and let us know that you support OPB.
[39:15] Right now, we'd like to thank those of
[39:17] our viewers who have called in to pledge
[39:18] their support. We really appreciate your
[39:20] commitment. We'd also like to encourage
[39:22] those of you who haven't called yet.
[39:23] Come on, don't be shy. Our volunteers
[39:25] are right here. They're ready to take
[39:27] your calls right now, but you have to
[39:29] make that call. You know, becoming a
[39:30] supporting member of OPB is as easy as
[39:32] picking up the phone. If you're watching
[39:34] us in Portland, call 2452345.
[39:37] From anywhere else in our viewing area,
[39:39] all of Oregon, Southwest Washington, the
[39:41] call is free. 1 8002452346.
[39:45] Let us know that the McNeel Larry
[39:47] NewsHour [music] matters to you. And now
[39:49] we return to the NewsHour. Thank you.
[39:54] >> [music]
[39:58] >> If you'd prefer to mail us your
[39:59] contribution, here's the address.
[40:01] [music] Oregon Public Broadcasting
[40:03] Foundation, Post Office Box 4373,
[40:07] [music] Portland 97208.
[40:10] However, if you'd like to call in your
[40:12] contribution, our phone volunteers will
[40:14] be glad to take your pledge in Portland
[40:17] 2452345.
[40:20] elsewhere in our viewing area.
[40:22] 1-8002452346. [music]
[40:33] [music]
[40:37] It was the concert of a lifetime. In
[40:39] 1986, the legendary Vladimir Horowits
[40:43] returned home to Russia after a 61-year
[40:45] [music] absence. And the result was an
[40:48] outpouring of emotion that touched the
[40:50] world. This is Charles [music] Don. Join
[40:52] me for this historic musical events
[40:56] in Moscow.
[40:58] >> It's where you belong. Sunday night at
[41:00] 9:30.
[41:14] [music]
[41:19] Finally, tonight we resume our series of
[41:22] conversations with Nobel economists on
[41:24] the state of the US economy. Earlier
[41:26] this week, we heard from Robert Solo and
[41:29] Paul Samson. Tonight, 1976 Nobel Prize
[41:32] winner Milton Freriedman. Professor
[41:34] Freriedman is senior research fellow at
[41:36] the Hoover Institution and author most
[41:39] recently of Money Mischief: Episodes in
[41:42] Monetary History. who joins us from San
[41:44] Francisco. Professor Freriedman, thanks
[41:46] for being with us.
[41:47] >> Glad to be with you.
[41:49] >> First of all, and just briefly, do you
[41:51] have any thoughts on the subject we were
[41:53] just discussing, Jim was discussing with
[41:54] our four guests about giving aid to the
[41:57] to the to the former Soviet Union to
[41:59] Russia? Is what's the economic impact of
[42:02] doing something like that? So far as
[42:04] Russia is concerned, I agree very much
[42:06] we have a great opportunity and it's
[42:08] enormously important for us that Russia
[42:11] develop in a free market and dem
[42:13] democratic way. The real question is not
[42:16] should we help them but what are the
[42:18] most appropriate means for helping and I
[42:21] think what Dr. Star said uh sort of
[42:24] duplicates what I would say. We need to
[42:26] help them by letting them help
[42:28] themselves. I think large grants of
[42:31] money from government to government do
[42:32] more harm than good and that that's not
[42:35] the way to proceed. On the other hand,
[42:37] removing obstacles to free trade between
[42:40] them and us, removing any obstacles we
[42:42] can to their trading inside their
[42:44] country, that's all to the good.
[42:46] >> All right. Well, let me now bring you
[42:47] back uh back home again, and that is to
[42:50] the to the presidential campaign
[42:51] underway right now. Are any of the
[42:53] candidates saying anything right now
[42:55] that you think would help the economy?
[42:57] And specifically, I want you to start
[42:58] with President Bush because you wrote a
[43:00] pretty tough article in the New York
[43:01] Times last month in which you uh you
[43:03] took him to task.
[43:05] >> Yes, I did. And I I I hold by that.
[43:08] Unfortunately, Mr. Bush has reversed Mr.
[43:10] Reagan's policies. He's raised taxes
[43:13] instead of lowered them. I shouldn't say
[43:15] he alone. He's had a lot of help from
[43:17] the Congress. He's added to regulation
[43:19] instead of reducing it. He's presided
[43:22] over a very rapid increase in government
[43:24] spending. All those things are very
[43:26] harmful. Uh unfortunately
[43:29] uh none of the major presidential
[43:32] candidates
[43:33] is in my opinion saying what's important
[43:36] for the United States people to hear.
[43:39] The so far as the uh Mr. Bush and the
[43:42] Democrats, they are all big government
[43:45] candidates. Their fundamental approach
[43:48] and value is that government can solve
[43:52] problems. that government is not big
[43:54] enough. We just need to find ways to
[43:57] make it bigger. Mr. Buchanan is the only
[43:59] one who is talking about smaller
[44:01] government, but unfortunately I strongly
[44:04] object to his protectionist and
[44:06] isolationist views. So I find myself
[44:09] very unhappy with all of the major
[44:12] candidates. So when they talk about a
[44:13] tax cut for the middle class, uh
[44:15] certainly raising taxes on the upper
[44:17] income folks, which I'm I'm sure you
[44:18] disagree with. Jerry Brown's flat tax,
[44:21] he's talking about what 13% and then a
[44:23] value added national sales tax. None of
[44:25] those things you think is is a
[44:27] >> No, I'd stop there. In 1963, in a book I
[44:30] wrote on capitalism and freedom, I
[44:32] recommended a flat tax. However, the
[44:34] flat tax I recommended would not include
[44:36] a value added tax. I think the value
[44:39] added attack while from an e technical
[44:41] economic point of view it has much merit
[44:44] it's politically a very dangerous thing
[44:46] because it's so efficient a tax and so
[44:49] invisible that it's very tempting to the
[44:52] government to the congress or the
[44:53] legislators to increase it in order to
[44:55] get more revenue but the flat tax idea
[44:58] is a very good one properly uh properly
[45:01] carried out I'm not supporting the
[45:03] details of what Jerry Brown says but
[45:06] that particular aspect of it is very
[45:08] good.
[45:08] >> What about the other talk we're hearing
[45:10] especially from Governor Clinton and
[45:11] Senator Songus about uh business uh
[45:13] incentives tax incentives to get
[45:15] business to
[45:17] >> that does more harm than good. You know,
[45:19] the idea that somehow the people who run
[45:21] the post office can judge which
[45:24] industries need tax incentives and which
[45:26] don't, which industries should be
[45:28] favored and which shouldn't, doesn't
[45:30] strike me as a very sensible idea or a
[45:32] real problem. I'm not talking about the
[45:35] current recession, which is a problem.
[45:37] I'm talking about our more fundamental
[45:39] problem of the society. Our real problem
[45:41] is not that government isn't doing
[45:44] enough in the way of incentives or
[45:45] regulations and so on. It's that
[45:47] government is doing too much, which is
[45:49] too harmful. We have too big a
[45:51] government, not too small a government.
[45:53] >> And so, how small would you make it?
[45:57] >> Well, let's look at the direction we
[45:59] want to go into first. If if I really
[46:01] had my way, I'd bring it back to where
[46:03] it was for the first 150 years of our
[46:06] republic's existence, around a total of
[46:08] 10% of the national income instead of
[46:11] the present 40 to 45% of the national
[46:14] income. But again, I want to emphasize
[46:16] something else. We tend to talk as
[46:19] economists about the narrow economic
[46:21] problem. Should the Federal Reserve
[46:24] stimulate more? Should there be a budget
[46:26] cut? Should there be a budget increase?
[46:28] We observe as Bob Solo put very well in
[46:31] his first conversation uh on the
[46:33] subject. We observe that the people at
[46:35] large are very pessimistic,
[46:38] much more pessimistic than the
[46:40] statistical data on the severity of the
[46:43] recession would justify.
[46:45] They are, and for good reason. They're
[46:48] not pessimistic because we're in a
[46:49] recession primarily. They're pessimistic
[46:52] because they look around them and see
[46:55] that schooling is the schooling of their
[46:57] children is deteriorating although we're
[47:00] spending much more money on schools.
[47:02] They see they're having more and more
[47:04] problems with medical care which they
[47:06] see is getting more and more expensive.
[47:08] They see that the central cities are
[47:10] becoming unlivable. They see that crime,
[47:14] theft, all the rest are very much on the
[47:16] rise. And they say to themselves, "What
[47:18] has happened to us? Why is it that we're
[47:21] going down this road that we seem to be
[47:24] deteriorating in terms of social values,
[47:28] in terms of our cultural structure?
[47:30] That's in my opinion what's really
[47:32] making people pessimistic. And that's a
[47:35] far more important problem than whether
[47:37] there ought to be a middle class tax cut
[47:39] or a uh incentive for business.
[47:42] >> But specifically, what can government do
[47:44] about that? And what do you say about
[47:45] >> government? What government is producing
[47:47] those problems? What government can do
[47:49] is to stop producing those problems.
[47:51] Let's take them one at a time. Here's
[47:53] schooling.
[47:55] We have a spending per child
[47:59] in the past 20 or 30 years has gone up
[48:03] three times. It's multiplied threefold
[48:06] after allowing for inflation. Is there
[48:09] anybody in the country who will say that
[48:10] the quality of education has improved
[48:12] over that period?
[48:13] >> You're talking about money that's mostly
[48:15] come from state and local governments,
[48:16] right?
[48:17] >> Mostly from state. Oh, absolutely. Total
[48:19] expenditures on schooling, state, local,
[48:21] and federal, are about the size of our
[48:24] national defense. It's a socialized
[48:26] industry. 90% of our kids are going to
[48:28] government school.
[48:29] >> Well, if government doesn't educate the
[48:30] children, who's going to
[48:32] >> Well, be government doesn't educate the
[48:35] children at all. Teachers educate the
[48:37] children.
[48:37] >> Well, you know what I'm saying.
[48:39] Government raises the money that then
[48:41] government raises money schools and
[48:42] hires the teachers.
[48:44] >> I know that's the part of it that's bad.
[48:46] First, let's assume for a moment
[48:48] government raises a money. It doesn't
[48:50] have to run the schools.
[48:53] So, we've discovered and Russia's
[48:55] experience which came up is good example
[48:58] of that that socialism doesn't work. And
[49:01] we in the United States are no better at
[49:04] socialism than Russia was. We have a
[49:06] socialist industry in the schools. We
[49:09] ought to privatize it. That's what we
[49:10] tell Russia. Privatize. That's what we
[49:12] should tell ourselves. How do you do it?
[49:15] It's a very straightforward thing to do.
[49:17] Uh you say to every parent, if you
[49:20] choose to send your child to a
[49:22] non-government school, you will save the
[49:24] government, you will save the government
[49:25] money. In state of California, it's
[49:29] costs per child per year are roughly
[49:33] about well over 5,000 about 52 to $5,400
[49:37] a year. You will save the state $5,200,
[49:40] let's say. Well, we will give you a
[49:44] voucher for $2,600, half of that, which
[49:47] you can spend on any school of your
[49:49] choice. That's exactly the wording of an
[49:53] initiative which is now being which
[49:55] we're now trying to get put on the
[49:56] California ballot for next year.
[49:58] >> But what about
[49:59] >> what would that do? What would that do?
[50:01] >> That would provide parents with freedom
[50:04] to choose and to judge. The reason why
[50:06] schooling is bad now is because the
[50:09] customers have nothing to say.
[50:11] It's because you as a parent have very
[50:14] little control except by moving to an
[50:17] area that has good schools
[50:18] >> and the people move like that. And I and
[50:21] I want to quickly move on because only
[50:22] only got a few minutes left here because
[50:24] the government does of course take care
[50:26] of of huge other needs in our society.
[50:29] The the part of the budget that deals
[50:31] with social security, Medicare, Medicaid
[50:33] or whatever is 43% of the budget.
[50:36] >> That's right. Much too big. So what is
[50:38] not spending that money
[50:40] >> just to do what? I mean
[50:42] >> well let's take one at a time. Let's
[50:43] take the medical care system
[50:46] >> and again we only have a couple of
[50:47] minutes so we're going to
[50:48] >> okay government spending about 40% of
[50:50] the total spending which has gone up
[50:52] drastically. Once again government needs
[50:54] to privatize get that more on a private
[50:57] enterprise basis. I've suggested ways we
[51:00] can do that. Look the real problem is
[51:03] that the people no longer feel they're
[51:04] in control of the government and they're
[51:06] not. Can you tell me that the people of
[51:08] this country are in favor of paying
[51:11] twice as much as a world price for
[51:12] sugar? Can you tell me that the people
[51:14] in this country really want to sell
[51:17] water to farmers but at a very cheap
[51:20] price and to produce crops which are
[51:23] then subsidized, bought up from the
[51:25] farmers and destroyed? Can you tell me
[51:28] that the people in this country really
[51:30] want to subsidize the kind of things
[51:32] that the state is subsidizing, including
[51:35] some of the things you're saying? So far
[51:38] as helping poor people are concerned,
[51:40] we're not doing it very efficiently.
[51:42] We're increasing the number of poor
[51:44] people by our grabag of welfare
[51:46] measures.
[51:47] >> But you're saying most people don't
[51:48] think the government should be in the
[51:49] business of of paying out Social
[51:50] Security, Medicare, Medicaid, and other
[51:52] things. No, most people do believe they
[51:54] should be in the business of paying out
[51:55] social security.
[51:57] >> And I think the pro the thing to do in
[51:58] social security would be again to do
[52:02] what you really intended to do. Make it
[52:04] a program whereby people pay for their
[52:07] own social security.
[52:08] >> We've got less than a minute. I'm just
[52:09] going to try to What about what we're
[52:11] hearing out on the campaign trail again
[52:12] from the Democrats who are saying who
[52:15] are saying look to Japan, look to
[52:17] Germany. Those are governments that are
[52:19] involved in long-term economic planning
[52:22] and of course in more of an industrial
[52:23] policy just
[52:24] >> and their analysis their analysis of
[52:26] Japan and Germany is as defective as
[52:28] their analysis of the United States.
[52:30] Those countries in the first place have
[52:32] lower incomes, lower levels of
[52:34] consumption than we do. They are not as
[52:36] productive as we are and they too have
[52:39] governments that are too big.
[52:40] >> And what about the deficit? Is that not
[52:42] a problem or is that something we need?
[52:44] >> The deficit is a problem because
[52:46] spending is a problem. The real problem
[52:48] is that we the governments at all levels
[52:50] are spending 40 to 45% of our national
[52:53] income and we are not getting our
[52:56] money's worth and the people know that
[52:58] that's the real source of their
[53:00] discontent. They want to get control
[53:02] over the government.
[53:03] >> Well, Professor Milton Friedman, we
[53:05] thank you for being with us.
[53:07] >> Glad to have been with you.
[53:12] [music]
[53:15] Again, the major stories of this
[53:17] Thursday. The House of Representatives
[53:19] moved toward full disclosure of all past
[53:21] and present members who bounced checks
[53:24] at a congressional bank. And the United
[53:26] Nations Security Council declared Iraq
[53:28] was violating the Gulf War ceasefire
[53:30] agreement. They ordered full and
[53:32] immediate compliance. Good night, Judy.
[53:35] >> Good night, Jim. That's our NewsHour for
[53:36] tonight. We'll be back tomorrow night
[53:38] with a conversation with another Nobel
[53:40] Prize winning economist, James Buchanan,
[53:43] plus political analysis from Gergen and
[53:45] Shield. I'm Judy Woodruff. Thank you and
[53:47] good night.
[53:50] Part of helping the world live and
[53:52] communicate better is keeping it well
[53:54] informed. [music]
[53:57] That's why funding for the McNeel Lair
[53:59] NewsHour is provided by AT&T
[54:04] and by PepsiCo.
[54:06] >> [music]
[54:11] >> Pepsi [music]
[54:14] and by the Corporation for Public
[54:15] Broadcasting and viewers like you.
[54:26] It's a night for British Mystery
[54:28] beginning at 9:00 following the frugal
[54:30] gourmet, the American Soda Fountain.
[54:33] Next here on OPB. It's where you belong.
[54:39] [music]
[54:44] [music]
[54:55] I
[54:57] [music]
[55:01] feel [music]
[55:07] [music]
[55:22] [music]
[55:25] Video cassettes of the McNeeler NewsHour
[55:27] are available from PBS video. Call
[55:30] 1-800328
[55:33] PBS1.
[55:39] This is [music] PBS.
[55:51] [music]
[55:59] >> [music]
[56:05] >> Hi there and welcome back to Oregon
[56:07] Public Broadcasting. Now that's it for
[56:08] tonight's McNeel Lair NewsHour. But
[56:10] don't go away. We have a whole evening
[56:12] of quality public TV programming lined
[56:14] up that you won't want to miss with the
[56:16] Frugal Gourmet with his American soda
[56:18] fountain and a two-part Clero Mystery.
[56:20] Good evening everyone. I'm Jack McGowan
[56:22] along with Bob Kellogg and Joan Biggs.
[56:24] We want to take a moment to talk to you
[56:26] about OPB. Joan,
[56:27] >> thanks Jack. I'm Joan Biggs. All you
[56:30] have to do tonight is pick up the phone
[56:31] and give us a call. Please let us know
[56:34] that you appreciate the programming
[56:35] you're watching tonight with a generous
[56:37] pledge. For a $60 contribution, you'll
[56:39] receive an OP mug with its unique
[56:42] handetched design. Or contribute $100
[56:44] and we'll send you two mugs. It's quite
[56:46] a deal. The probe, the number to call in
[56:48] Portland is 2452345.
[56:51] And if you're calling from any of our
[56:52] other viewing areas in Oregon or
[56:54] southern Washington, the call is
[56:56] toll-free 1-8002452346.
[57:00] Please call now.
[57:02] >> Hey, why call? Well, because you are
[57:04] part of a community of 1 and a half
[57:06] million weekly OPB viewers who
[57:08] appreciate the quality and diversity of
[57:10] public broadcasting. I'm Bob Kellogg,
[57:12] and I'm asking you to do your part to
[57:14] make sure OPB is here for you.
[57:17] >> [music]
[57:23] [music]
[57:27] >> Heat.
[57:31] Heat.
[57:33] [music]
[57:42] I [music] go
[57:47] [music]
[57:54] [music]
[58:02] every morning.
[58:05] >> [music]