The MacNeil/Lehrer NewsHour

Thank you very much. [intro music] Good evening, here are today's top headlines. The government reported that the economy slowed drastically in the first three months of 1985, but inflation remained low. President Reagan expressed frustration with Congress over Central America. There was more heavy fighting in Lebanon. Jim. The NewsHour tonight will go like this. First, the news of the day. Then a focus segment on the economy, with two economists and the editor of Money magazine, looking at the GNP inflation, interest rates, and all the rest, plus a report on the winners and losers in a one-day stock market rally. There's a second focus segment on today's abortion demonstrations with a participant from New Hampshire and her anti-abortion senator, and finally a five-year

update report on the eruption of Mount St. Helens. The MacNeil/Lehrer NewsHour is funded by AT&T, the Corporation for Public Broadcasting, and this station and other public television stations. The government today released a key statistic showing that the economy weakened even more sharply in the first quarter of this year than predicted. The gross national product grew by only seven tenths of a percent from January to March. But the latest inflation figure was better news, despite a further jump in fuel prices. Consumer prices rose by only four tenths of a percent in April, meaning an annual inflation rate of 4.2 percent. Administration spokesman, said they hoped that falling interest rates would lead to a rebound in the economy. Some private analysts fear that the current slowdown may be more severe. Wall Street, which saw sharp advances yesterday, had mixed trading today. The Dow

Jones Industrial average was up nearly 20 points yesterday, closed up only 4.82 points today at 1309.70. Right after this news summary, we have a major focus section analyzing what's happening in the economy and how it should affect the day-to-day decisions of the average American. Jim. Central America was very much on President Reagan's mind today. He met at the White House with the President of Honduras, Roberto Suazo Córdova. After the meeting, the two presidents exchanged words of friendship and support in the fight against mutual enemies. Our two governments share serious concern over the threat to the entire region posed by the communist Sandinista regime in Nicaragua and its Cuban and Soviet supporters. President Suazo and I renewed our commitment to face this challenge together and to counter aggression and subversion. President Reagan and I have evaluated the international dangers faced by Honduras, the Central American region and the United States itself. Our countries will

not fail to provide assistance to each other in order to face these threats. In the case of Honduras, we have received security guarantees from the United States. Honduras does not have aggressive designs on any country. In the crisis faced by Central America, we shall continue our efforts to reach a negotiated agreement within the Contadora Peace Initiative. The Republican congressional leadership also heard from Mr. Reagan today on the subject of aid to the Nicaraguan Contras. Senate Majority Leader Robert Dole said after their weekly one-house session that Mr. Reagan is clearly frustrated with Congress. He felt very strongly about the way Congress is horsing around on Nicaragua. When the issues are very clear, we don't have to make excuses for Ortega. He knows where he's going. We probably don't know what we want to do. I might say this, the President, very frustrated. He made a very firm statement about how it's pretty tough to conduct foreign policy if you have to go through a committee of 535 members when we're dealing with a communist group in Nicaragua and a non-communist group. He finds it more than frustrating that he can't

do anything without coming to Congress every two or three weeks or two or three months. The Republican-controlled Senate did show its strong support for another Reagan policy issue today by voting down a Gary Hart amendment that would have killed funding for the MX missile. The vote was 56 to 42. The Navy today accused the General Dynamics Corporation of brazen and improper business conduct. Navy Secretary John Lehman told a news conference the Navy would stop processing up to a billion dollars worth of new contracts until the company reformed its dealings with the Pentagon. The Secretary also said he would cancel two existing contracts worth a total of 22 and a half million and would fine the company $676,283 for giving gratuities to retired Admiral Hyman Rickover. It involves a pervasive corporate attitude that we find inappropriate to the public trust. We are not just another customer. We're not a commercial customer. And the attitude that

the buyer must beware is an attitude that we do not believe is appropriate to a supplier to the Defense Department. Secretary Lehman said, to reform, General Dynamics would have to establish a code of ethics and resubmit millions of dollars in requests for overhead payments which the Navy has questioned. There was an abortion speak-out in Washington today. Women who have had abortions told their stories at a day long pro-choice rally. The purpose was to drum up support for legalized abortion and was sponsored by the National Abortion Rights Action League. One woman described an illegal abortion she had 16 years ago. The rape had been frightening and confusing. This was worse. I could not see a thing, not even light. A mask was put over my mouth and nose. There is a moment of panic and I was out.

The next thing I knew I was lying on a couch, eyes uncovered. The abortion was complete. There had been two fetuses. There was a tremendous sense of relief that rushed through me. I couldn't wait to get out of there. Several days later there was an article in the newspaper about an abortion clinic that had been raided in the area where I had been picked up. The abortionist was a mechanic. We will have a report on one of today's speak-out speakers and then a debate between her and her U.S. Senator later in the program. In Orange, California this morning, six of seven septuplets survived a premature birth by cesarean section. The seventh, a girl, was stillborn. The six survivors all weighed less than a pound and a half each. Four are boys. Two are girls. All were reported in critical but stable condition tonight. The parents are Patricia and Samuel Frustaci. She is a 30-year-old high school English teacher. He is 32 years old and is a salesman for an industrial firm. They live in Riverside, California.

Some 36 doctors, nurses, and other medical professionals were involved in the birth operation this morning. For the second day, there was heavy fighting at three Palestinian refugee camps in Beirut. Shiite Muslims of the Amal faction are trying to seize control of the camps and disarm the combat units of the Palestine Liberation Organization. At nightfall, the casualty toll came to at least 121 people killed and 637 wounded. In Israel, there was a joyful welcome for three Israeli soldiers who were released by the Arabs yesterday and a chorus of complaints about the 1150 Palestinians and their allies who were released by the Israelis. Here's a report from Rod Stephen of Visnews. A day after the Israelis had been released from their prison in the Syrian capital Damascus, they were arriving home. At Tel Aviv Airport, a cordon of tight security held back the welcoming crowds. One by one, the soldiers who hadn't seen their families and friends for three years stepped from the aircraft. The atmosphere was filled with emotion as

journalists, cameramen, relatives, and friends jostled to get close. Within only a few seconds, the three soldiers were embracing their wives and friends. Palestinians too were being welcomed home by jubilant crowds. But the release of known guerrillas like Talib Abu Qadir, rest bitterly in the hearts of many Israeli leaders. In Tel Aviv, Defense Minister Yitzhak Rabin reflected those feelings. I will not deny the price that we have paid for it is heavy and painful. On the West Bank, in the town of Hebron, hundreds of Jewish settlers gathered to protest against the freed Palestinian guerrillas. The town has become home for a number of the convicted killers and bombers. One protester said the Israeli government had forsaken its people by allowing murderers to live within minutes of his home. There were also complaints from nationalist members of the Israeli parliament and demands

for the release of 27 Israeli activists who were on trial for attacking Arabs. There was an oil drilling tragedy off the Louisiana Gulf Coast this morning. Eleven people are either confirmed dead or trapped underwater and believed dead. Authorities said a huge drilling barge tipped over in a bayou ten miles from Morgan City, Louisiana. Twenty-three workers were on the barge. Ten were pulled safely from the water immediately. Two others were freed by rescuers five hours later. The rig is 200 feet long and 54 feet wide. It came to rest at a 45 degree angle. There was no immediate explanation as to what caused it to capsize. And finally, in the news of this day, there was the prediction of another eruption at Mount St. Helens. A spokesman for the U.S. Geological Survey said small-to-moderate size explosions could hit the southwest Washington state volcano within the next several days. He said the impact could be similar to the dramatic eruption five years ago. That five-year anniversary was just Saturday. And our last piece of business tonight will be a look at the volcano five

years later. [music] For our lead focus section tonight, we examine the sudden slowdown in the U.S. economy and what it means. The slowdown has been dramatic with 10 percent growth in the first quarter of 1984, following to 4.3 percent by the end of the year, then to 0.7 percent for the first quarter of this year. At the same time, inflation has held steady. Recently, interest rates have been coming down, many banks lowering their prime lending rate to 10 percent, and they're expected to fall further following the recent Federal Reserve Board decision to cut its key lending rate, the discount rate, to 7.5 percent; that happened on Friday. For two views of what's happening in the economy, we have Saul Hymans, economics professor at the University of Michigan. Professor Hymans heads the university's economic forecasting unit, and last year was named Forecaster of the Year. He joins us tonight from public

station WTVS Detroit. We also have David Jones, chief economist and senior vice president with Aubrey G. Lanston, a leading Wall Street securities firm. David Jones, starting with you, why has the economy slowed down so sharply? What has caused this? We have a unique and powerful force at work in this economy right now. It's a force that's literally breaking the backbone of our industrial sector. It's a huge trade deficit. And what it means, in effect, is that consumer and business spending are spilling over into a flood of imports. That creates jobs abroad, but hurts output and employment in the U.S. I see. Professor Hymans, what is your explanation of what's happened? I think that what you've just heard is exactly correct. In the first quarter of this year, we had in this country a growth of demand of three and a half to four percent. That's not slow. That's a pretty healthy rate of growth of demand in the domestic economy. But we had imports rising at a 30 percent rate in the first quarter, and that's the spill

over that Mr. Jones was talking about. We did not get our share of demand coming through to domestic production. Demand means American consumers willing to spend money. Not only consumers, Americans, consumers, business, and government are all contributing very strongly to the growth of demand in the United States. But we're satisfying that demand with a lot of growth of imports. Are we actually technically in a recession right now? We had a brush with a recession in the first quarter, but a recession means something like flat growth, flat or even declining economic activity. We're not there yet. We had a brush with it. I'm afraid that we may be flirting with it later in the year, and, by early 1986, we could be in a mild recession. What's your view of that one, Professor Hymans? I think the flirting part is correct, but I think we will get out of it because without going into a recession in the next year, because I think the Federal Reserve is acting quite responsibly in reaction to what's happening in the domestic economy. That's their action

at the end of last week, cutting the discount rate from 8 percent to 7.5 percent. That'll go a long way, and I think the Federal Reserve is poised to continue to move in the same direction to keep the economy from sliding into a recession. What we've got to do, understand, is not drop imports. All we have to do is keep imports rising roughly in line with demand in the United States. Then we'll get our share of production. How do you do that? How do you keep imports rising roughly in proportion to demand? Well, the reduction in interest rates is a move in the right direction, because what's going to happen as a result of interest rates falling in the United States is the dollar will simply look less attractive to foreign investors looking for places to put their money. That will take pressure off the dollar. The dollar will begin to decline in value. As a result, imports will become more expensive. We will move in this country toward less import of goods and services and more domestic production. By the same token, the rest of the world

will begin to import more from us, so that we will move the balance at the margin toward more domestic production in the United States. Do you agree that the Fed has nipped this in time with its lowering the discount rate? There's still an open question. We have a conflict between the academic side and the real side. The real side is that virtually every-- You're the real side; he's the academic side? Virtually every business in this economy was hit one way or another by import competition or by difficulty in selling exports, and many businesses are buying materials abroad. Other businesses have moved their factories abroad in order to produce for the export market. That's a difficult thing to reverse. We're going to have a tough year in 1985 because of that deep trade deficit, and it's going to be very difficult to turn it around, and I think the Fed's going to have to do some more easing before it's over. The New York Times reports today that there's actually a two-tier economy operating at the moment that you have a virtual flat performance in manufacturing industry, in fact almost a recession there, but quite a spirited performance in the service industries. Do you two

economists agree with that description of what's going on? That's precisely said, but with that manufacturing sector in the soup for quite a while, I think it's going to spill over into high tech and even into the service sector. There's no way we can keep this economy separate. If manufacturing is hit hard, eventually high tech and services will be hit hard as well. What do you think about that, Professor Hymans? Do you agree with the description, first of all, about what David Jones just said? Yeah, I think that two-tier economy is an apt description of what's happening, but I disagree that we have to look over the next year to any substantial turnaround or reversal in what's happened to our net export position. All we have to do is keep it from deteriorating further. If it stays where it is, for example, then most of the increase in domestic demand in the United States will find its way into domestic production. So we have two tiers in a number of senses. We have a two-tier system as described by the New York Times between the manufacturing sector and the service sector of the economy. We also have to look at

the two sides of the economy in terms of demand and production. The production side is critical because that's what employment depends on. If the production side stays weak, employment will weaken, and that will inevitably weaken the demand side. It's therefore very important that the Fed has moved quickly in the direction it has, and I think that it may indeed have to move further in that direction, but I judge that it's poised to do exactly that. Well, David Jones says that, although the Fed has stepped in and may do so again, that it's going to take a while for it to have any difference. What industries can this pump priming by the Fed have a quick effect on? It's not pump priming, and the issue is not to have a quick effect in the sense of reversing the tide. What you have to have a quick effect on is how much of future growth in demand is satisfied by continued growth of imports. You don't have to cut back imports. You just have to stop them from growing as rapidly as they have been growing. Any movement that you make positively in that direction has a major impact on what happens in terms of

domestic production. So, I agree that it's going to take years to get out of the situation that we've gotten ourselves into, which is a big trade deficit. But we don't have to get out of that situation in the next few months to have a major difference in the tone of the production sector of the economy. Where do you see the Fed's lowering the discount rate having an immediate effect or an early effect? In which industries? Well, it should begin to help housing. Housing actually has been doing quite well, but there's a big catch here. The discount rate is a short-term rate. It's really the rate the Fed charges banks. It's kind of an exotic rate, and the other short-term rates that tend to march to the tune of the discount rate will come down. But what we need is long-term interest rates, corporate bond rates, mortgage rates, and other kinds of long-term cost of funds to come down. There's no guarantee that we'll get enough relief soon enough in that long-term area, for example, to turn business spending plans around. Businesses right now have revised down their spending plans to a negative growth next year. That's very dangerous, and it's going to take a while to change their minds.

To sum up, looking at what's happening right now, and the next few months, you said it's going to be a tough 1985 for the rest of the year. In what sectors, in what industries, do you expect it to be tough? I think there will still be major problems of all of our import and export businesses. I think maybe even the auto industry could suffer a little bit. You'll note they have to give bargains to buyers right now to keep car sales up. I think that stealing from future demand later in the year, therefore, the threat of recession is greater. With the threat of higher unemployment? Exactly. The unemployment rate, which moved down to the vicinity of 7 and a quarter percent, the civilian unemployment rate could be back to 7 and 3 quarters by the end of the year, maybe to 8 by early 1986. What areas of the economy do you see having a tough time and which a good time in the next few months, Professor Hymans? Well, I think that the automobile industry and the housing industry and the service industry will continue to move strongly forward. I think it's overstating the negative aspects of the case to forecast that we're going to be back at a 7 and 3 quarters percent unemployment

rate by the end of the year. That could happen. That's within the realm of possibility, but I think that that would be a situation that would develop if we had policy moving in the wrong direction. I think we have policy moving in the right direction, and therefore I'm expecting that we will have, not what's going to go down in the annals of economic history as a banner year in 1985, but I don't think we're going to have negative growth quarters in 1985, and we could go right into 1986 without a recession. But the press today described it as the possibility of a very stagnant period in later in 1985 and into 1986, and with that I would certainly agree. I think we're going to be talking about growth that may be in the 3 percent range rather than 4 to 5 percent range, but I think we can avoid negative growth or a true recession if we continue to have policy moving in the right direction. The federal budget we haven't mentioned at all in this discussion, and that's a very important aspect of things as well, in terms of the perceptions of what the future is

going to be like, and I think the moves that are being made in the Congress to get control of the federal budget, to reduce the budget deficit, are both positive for the longer term aspects, especially for the long-term interest rate aspect that Mr. Jones was talking about, and as well for the possibility that the Fed will feel it has the maneuvering room to continue to provide some stimulus on the monetary side. Professor Hymans in Detroit, David Jones in New York, thank you both very much. Thank you. Jim. You're welcome. We bring it down to the non-economist consumer level now with Marshall Loeb, managing editor of Money magazine. First Mr. Loeb, from a consumer's point of view, are today's growth figures something to worry about? Of course you always have to worry when there's any kind of a substantial decline in the economy, but I think that Professor Hymans is right. There is considerable strength left in this economy, and many things continue to move in a good direction for the consumer.

Interest rates are down, and inflation has been curbed. Does this mean this is a good time to buy a house? I think if you need a house or a condo, it's as good a time as any to buy a house. Why? Mortgage rates are down for one thing, and people, lenders are out trying to get customers, but there's a big difference between that and investing in real estate. I don't think that amateurs ought to invest in real estate, unless they're prepared to watch it very carefully. Now what's the danger there? Well, for one thing, we've seen a lot of real estate bubbles burst. For another, we have the possibility of tax reform coming on, and that reform, of course, could take away a lot of the tax deductions. What about other consumer items like automobiles, refrigerators, things like that that you would borrow money to buy? Is this a good time to do it or to wait?

I don't think that you ought to go out and strap yourself. The interest rates, of course, have come down. If you are in a position where you've got disposable income, then of course there's a good reason to go out and do that kind of buying. Is it the average person, should the average person count on interest rates coming down no matter what, whether that is buying a car or a house or investing the other way? Is it something that it's safe to count on right now? Of course not. I think interest rates have gone down just about as far as they're going to go. It's possible that they'll come down by another half a percentage point or a full percentage point by the end of the year, but it's nothing that you can bank on. Somebody told me yesterday, now is the time to take all your money out of money markets and get it out of there, because interest rates will come down and that's no place to have your money when interest rates are coming down. Is that correct? I think that there are better investments for people than money market funds, and certainly a lot of those interest rates have come down dramatically. But then you have to consider just what you can put your money into.

Everybody should aim to have some kind of a cash cushion and liquid assets of about three months worth of after-tax income. If you've got young children, lots of dependents, you may need even more than that. Money market funds are about as good a place as any to have that kind of money. But once you've built up that cash cushion, it's probably advisable to start investing your money in other places. Like what? Well, I would think that the stock market is a very good investment at this moment, although the market's gone up considerably. Inflation has been heading down, and when interest rates go down as they have, that's all very favorable for the market. What about those items that are normally called inflation hedgers, like art and antiques and that sort of thing? Is this a time to go into that? Much as with real estate, if you are an expert, if you really know what you're doing, of course, but very few of us are expert.

If you love the art, if you love the antiques, certainly go out and buy it. If it's something that you want to live with, but I think very few people are sufficiently expert to be able to go out and do that on an investment basis. In other words, there are much better things that you can do with your money than to sink it into collectibles. Thank you. Robin. Speaking of the stock market, Wall Street has not attracted back the proportion of small investors it used to have. Individual investors, as opposed to institutions, now account for only 10 percent of all trading on the New York Stock Exchange, compared to 33 percent in the late 1970s. One factor keeping them away may be the new volatility in the market. Yesterday, it went up nearly 20 points. Today, it registered a five point gain. Recently, there have been a number of stock market rallies that were over in one or two days, before the small investors got on the bandwagon. June ?Raselle? has a report on what causes these very short rallies.

One man who has been thinking about this market action is Columbia Business School Professor Charles Wolf. Wolf has been spending a year away from the classroom at First Boston Corporation, a leading Wall Street investment firm. He's been observing the workings of the stock market and has some ideas about one-day rallies. It's a compression of activity. It's a compression of movements of the market to a new level based upon these large amounts of buying that take place by the institutions. And what would normally take, say, a month or two to occur now can take place in a day or two. Another market follower is William Silber, a trader at the New York Futures Exchange and a professor at New York University's Graduate School of Business. What happens is everyone's looking at the same information, everyone's interpreting the same information in a very similar way, and the fact that there are lots of institutions in the market who closely watch their positions leads to similar kinds of interpretations, and

therefore either everybody on the buy side or everybody on the sell side. The experts agree. Today's stock market moves the way it does because of the behavior of large institutional investors such as banks, corporations, and insurance companies. The individual investor has fled the market. Ten years ago small trades of 900 shares or less accounted for almost half the trading on the New York Stock Exchange. Today, institutions account for as much as 90% of daily trading volume. While all big-board stock trades are still officially executed on the exchange floor, the real action has moved from the stock exchanges to the trading desks of investment banking firms like Goldman Sachs. The chief clients of firms like Goldman Sachs are money managers who supervise the portfolios of corporate and union pension funds. Since 1975, pension fund investments in the stock market have tripled.

Today, this pension fund money moves the markets. Robert Rubin is a partner at Goldman Sachs. I think the difference between an institution and an individual is that an institution has professionals who are focused full time on what they're doing, and those institutions are subject to tremendous short-term performance pressures so that when something happens they react immediately. Thanks to advances in telecommunications and computers, traders like Richard Perry have immediate access to information that could affect particular stocks or the market as a whole. We've got a big Dow Jones screen up there with all the complete articles, and then I get all the individual articles here. And if I want to, for instance, look at this thing, it says, there's an article on Unical on Reuters right now, I go Reuters 202 and it gives me the article right on my screen. This is something that's coming out on the Reuters machine right now, and I can watch this happen as it's coming out. Oftentimes there are material or there's information that comes over one of the new services that's particularly important to our business.

Someone's going to cut their earnings if there's a natural disaster, if there's going to be a corporate buy-back, and usually if you're able to act on this quicker than other people, you're able to make money on it. All major investment firms have the same equipment that Richard Perry uses. According to Wall Street observers, most traders tend to react alike. The result can be short dramatic moves, one-day rallies. Another explanation for one-day rallies is the growing pressure on money managers to perform well in the very short term. One of the veterans on the money management scene is Fred Alger, who heads his own firm. The nature of our business is that unlike many professions, is that our clients can measure how good a job we do. They give us so much money on the first day of the year, and at the end of the year they know how much money we've made them. And this can be measured against all other money managers or managers like us with similar kinds of styles. So there is that pressure. That is that pressure.

The worst thing that can happen to a money manager when a rally begins is to miss it. And it's my conjecture that what we're seeing happening is a herd instinct on the part of managers, on these phenomenal one-day rises that we've seen, where once it begins, a money manager says, "I've got to get in, because I don't want my client, whatever pension fund it has to be, to see that I missed the rally." And so, as a consequence, once the rally begins, it starts to pick up steam and it feeds on itself as these money managers jump in. Now a new factor has entered the equation: massive trading of stock index futures. Stock index futures allow investors to bet on the price of the overall stock market at

some future date. Today there's more action on the financial futures exchanges than on the stock exchanges themselves. This enormous activity often causes sharp moves in the stock market. I think that they do affect the market day to day and they can have surprisingly large effect on the averages, because most of the buying-selling programs are focused on big stocks which offer liquidity. Some Wall Street observers say that, in today's volatile stock market, the deck is stacked against the small investor. How can a little guy compete against fast-moving, giant institutions? Here's the advice from some Wall Street professionals. The best advice is to sit back and say, look, there are the spikes in the market that the professionals are involved in and they're involved in for very good reasons, new information. Small investors really should not get into the business of trading. They are investors, and the difference between investors and traders is a time horizon. I own stocks, and when they take one day moves or two day moves or whatever it may be and

there's nothing going on with respect to the company, I don't worry about it. To the extent that I own stocks, I tend to invest for the long term. Marshall Loeb, back with you. You said a moment ago this was a good time to invest in the stock market. How would you add to that advice we just heard to the small investor? I would say invest and invest for the long term. Try to avoid the short-term movements whether down or up. Nobody but nobody can predict where the stock market is going to go a week from tomorrow or a month from tomorrow. But I think you've got a better idea of where the market might be a year from now or even five years from now, and there are a lot of forces in action that would suggest that the stock market might go up. The individual investors should not be afraid because he can't have the information that these big professional traders can operate on with their huge volumes of stocks they're moving around? The individual investor can ride with the professionals by buying into a mutual fund, which gives you the advantage of professional management of your money and wide diversity because these

funds invest in stocks, if you want to go into a stock mutual fund or bonds or a combination of stocks and bonds, and if you look at how mutual funds have performed, stock mutual funds, they've gone up much much more than the cost of living index. For example, if you just go back ten years to the first quarter of 1975, the average stock mutual fund has gone up some 350 percent since then. Now that is not to say that in the next ten years stock mutual funds will go up another 350 percent, but a lot of forces are in being that would suggest that the market now is still under value, despite the rises, and will go up in the future. Marshall Loeb, we have to leave it there. Thank you very much. Jim. Still to come on the NewsHour tonight, the abortion demonstrations and arguments as seen by Senator Humphrey of New Hampshire and a disagreeing constituent, and an update look at Mont St. Helens, five years after the big eruption.

There were women in Washington today telling very private stories to all who would listen. They were women who have had abortions, and their purpose was to lend support for legalized abortion. It is the subject of our next focus segment, which begins with this report on one of the women who spoke. Correspondent June Cross reports. [singing] This rally is in Portsmouth, New Hampshire, but the same scenes have been occurring in communities across the United States for the last month. They say I had an abortion for convenience sake. They are wrong. The women are housewives, teachers, professionals, politicians, but they share one thing in common: they have each had an abortion, and they have each decided to go public with their private

lives. My name is Liz Whaley and this is my letter to President Reagan. Women like high school teacher Elizabeth Whaley have been reading letters to the President, letters asking him to ensure that their right to legal abortions remains alive. They have taken their motto from the anti-abortion film, Silent Scream, a film which graphically depicts an abortion in progress. These women have decided to remain silent no more. There are many, many thousands of us who made responsible and rational decisions to have abortions, and we want to keep abortion legal and safe. We don't feel that the fetus is the most important issue. We feel that the living woman is. And we are not ashamed to say that, and so we need to speak up about it. In the winter of 1977, when I was 47 years old, I became pregnant after 19 years of marriage and three children, the youngest of whom was 15. There was no way that having a child at my age would have been anything but a complete disaster for all of us.

Liz Whaley is 54, the mother of three sons. She had her abortion seven years ago. Our voices have not been heard from sufficiently up until this point. They will be heard from now. Thank you. Ms. Whaley is a member of NARAL, the National Abortion Rights Action League. Last week, the New Hampshire chapter decided to send her to Washington, to voice their concerns. It's a trip that started last weekend. On Monday, Ms. Whaley met in New York with five other women, who will represent their states at the national speak-out in Washington. At a New York press conference, one woman explained why she is speaking out now. It's been 21 years, and I haven't talked about it. I don't ever want my daughters to go through that. I don't ever want anybody to hold that inside them for 21 years. I don't want to be made to think I did something shameful because I was 16 and more interested in being prom queen than I was in having a baby.

After the press conference, the women boarded a train for Washington. On board, NARAL field director Anna Trask gave them some hints on what to expect, including a warning about possible harassment from pro-lifers. Respect right-to-lifers. We certainly need to protect each of you from any personal harassment. You're always to go in pairs from and to the site, and we feel pretty strongly about that. And look out for each other. The first order of business once in Washington was a reception to meet members of the groups sponsoring Tuesdays speak out, as well as the other 45 women from the rest of the states, women who'd all had abortions. Nanette Falkenberg, the national director of NARAL, explained what brought them here. Because we came out of December and January with our anger over the clinic bombings and our frustration over the credibility that was being given to that piece of incredible propaganda that they call The Silent Scream, that we came out of it with a new sense of resolve and commitment and determination that we were going to set this issue right.

And it's wonderful. Bright and early this morning, the women were out telling their stories. It was a small gathering, compared to the hundreds of thousands who have marched against abortion. And many of them were older women, women who remembered going through illegal abortions. The rape had been frightening and confusing. This was worse. I had to wait about an hour from my turn. I'd been given a shot of something, had been vomiting. There were moments when I thought I was going to die. No woman should ever have to go through the hell on earth that I experienced. The rape was violent, and so was the illegal abortion. During her turn at noon, Liz Whaley took the opportunity to address the President personally. I am sick unto death of the media's hype over the unborn fetus. I am also disgusted with your over-concern for this issue, Mr. President. And with the over-concern of the many men in Congress, who talk so loudly about the need

for a human life amendment. And now the Civil Rights Act for the Unborn, Humphrey and Helms. What about my human life? My civil rights? Tomorrow Elizabeth Whaley and others involved in the speak-out will call on their respective members of Congress. We get a preview of one such call now, with Ms. Whaley and Senator Gordon Humphrey, Republican of New Hampshire, a strong opponent of abortion. Ms. Whaley, what do you want to say to the Senator? Well, I'd like to, first of all, give him these letters, which are just a selection of the hundreds that we've collected from New Hampshire, from women who were glad that they've had the choice of a safe and legal abortion. And we've collected thousands from around the country. And I would hope that he would read these thoughtfully and consider them and consider the women's lives that they speak about, and perhaps modify his position somewhat. I think that the abortion issue has been skewed, because abortion has been considered something

separate, something that you can abstract from the complex web of real women's lives and women who've had to make difficult decisions and hard choices. Senator, is what Ms. Whaley and the other women have done today and will do tomorrow, does that impress you in any way? What is your reaction to it is what I'm really asking, I guess? Well, certainly Jim, I'm impressed that Elizabeth and others have come to Washington to express their concern about women. She might not agree, but I and many others, men and women alike, are concerned about women. But I would wish that they would also be concerned about the life of the unborn child, because no matter how often we raise the argument that many people have had abortions or we know people who've had abortions, that doesn't change the central fact that an unborn child is killed by abortion. It's a terrible thing, and there are better alternatives. There is the alternative, for those who don't want to or can't, for some reason, parent

the child, the alternative of adoption is very responsible and ethical and loving alternative if I may say. So what I see on a political level, I think, is an effort by the pro-abortion forces now to shift the focus away from the intellectual, the medical argument about the fact that abortion takes the life of an unborn human being, and to shift it away into a new, almost irrelevant argument which suggests that abortion is okay because people in our community have had abortions. Just because lots of people do something, whether it's cheating on their taxes or on their spouses or whatever, doesn't make it right. And the central issue here is that abortion takes the life of an unborn child. I would say that the central issue here is that abortion is a complex matter involving other persons besides the fetus. The woman in question is very important. The circumstances in her life that bring her to the decision to have an abortion, her family, many complex

factors involved. And it's not just -- The central fact is not that an unborn child's life has been lost. The central fact is that it's very much a web of various issues. As a practical political matter -- first to you, Senator -- is there anything that Ms. Whaley or anyone else could say that would ever change your mind on abortion? Well, I just doubt it. I wish there were some room for-- Is this a special issue in other words? It is. It's an issue that goes to the conscience of our nation. It's an issue that goes to the ethical foundation of our nation. For if the standard is convenience or wantedness or lifestyle with respect to whether someone's life should be protected by law or not, then we're in big trouble. And I know that an unplanned pregnancy represents a hardship and in some cases a great hardship. But we all have hardships in our life that we have to deal with responsibly.

And, as I said, for those who can't or don't want to parent a child, there are millions of couples, like my wife and me, who would like to adopt a child, but there are none to adopt. Well people have abortions from all walks of life and at all ages, and to suggest that all people should complete a pregnancy because there's a family out there awaiting for adoption is not the point. It just takes away from the fact that the real issue is the woman, and these are women who've made moral, responsible decisions. And if you were to listen to the compelling stories of these many women from all over the country, over 50, from 45 states, who come with their stories and with their letters from their states, we feel this is bound to make an impression on other women who will come forward with their stories and who will make people, the press and legislators aware of the fact that women are determined to keep abortion free and safe legal.

What is the overall purpose of your decision and the other decisions of women to tell their stories? Well, I think my purpose is to show that women from all walks of life and all ages have had to make the difficult decision of abortion, and to encourage other women to speak up as they have been doing and write letters that we can present to legislators, in the hope that as the legislators see this groundswell and this pouring out of letters, they will have to be aware of that. What do you say, though, to the Senator's point that really this is not a normal political issue where letters from constituents and speeches from other people are going to change minds? Well, I'm just hoping to enlarge people like the Senator's perspective and add this needed dimension of women's life. There's always hope that people can change. There are others besides Senator Humphrey, who may be more on the fence. Jim, can I point out that there is a parallel movement, parallel to that which Mrs. Whaley

is involved in, called Women Exploited by Abortion. These are women who likewise have had abortions but who have now organized to tell their sisters that they now regard that as a tragic mistake, that in many cases they killed the only child they ever conceived, because in some cases abortion leads to infertility, now I'm not suggesting always. In any case, I'm saying that there are just as many women, perhaps more, who regret having had an abortion and who warn their younger sisters and colleagues that this is not the blasé procedure that it's sometimes depicted as. It's not just a matter of going into the abortion clinic and getting rid of some foreign tissues. It involves a human being, another human being. That may be that there are women who are sorry they had abortions, and I don't want to get into arguments with those people. I feel sorry for women who had to make uninformed decisions to have abortions. But the majority of the people in this country, 70-80% are pro-choice women and men.

I can test that. And that movement needs to become more vocal and more visible, because of the increasing harassment from the anti-choice people. You say that you don't agree with-- Well yes, Newsweek magazine, which is hardly a conservative publication, this past January conducted a poll, which they published, which showed that 76% of Americans feel that abortion should be restricted or made illegal in all circumstances or some circumstances. So only about 24% or 25 favor abortion under all circumstances. And in fact, public opinion is slowly shifting away from abortion. Again, this is talking about abortion as if it's something abstracted from the real lives of real women, many of whom are now speaking out, people who have had to be quiet about this. And taking the focus away from the killing of a life and the human life begins at conception, looking at the whole complex issue, this is the necessary refocus.

All right. Well, we didn't resolve anything tonight, but we aired it. And my thanks to both of you for being here. Thank you. [music] As we reported earlier, scientists watching Mount St. Helens have issued a new volcano advisory. They predict that the Washington state volcano will spew forth lava, possibly accompanied by explosions, some time within the next two weeks. But, according to the US Geological Survey, the eruption won't be anything like the catastrophic one of five years ago last Saturday. Lee Hochberg, of Public Station KCTS in Seattle, reports on what's happened to the volcano and its devastated surrounding since then. It had been some of the richest land in the country, the area in the shadow of Mount St. Helens, between Seattle and Portland and southwest Washington. Many had likened the mountain itself to Japan's Fujiyama because of its soft, symmetrical shape. That was before Sunday morning, May 18, 1980.

If you've ever seen a film of an atomic explosion, this will call to mind what this giant plume of ash looks like, a giant mushroom cloud, which has risen nearly 12 miles high. It's hard to imagine how that mountain, the size it is, could blow out a volume of material as large as this cloud is. 1400 feet of mountain gone, 57 people dead or missing, millions and millions of dollars of rich timber, leveled, charred, strewn about hillsides like toothpicks, titanic floods reshaping lakes and rivers, twisting homes and logging camps like they were toys. Five years after the cataclysm, the mountain looks deceptively serene. The mountain's crater, blown open in 1980, is two miles long, a mile wide. Mud and ash fields, up to 300 feet deep, coat the mountain's north flank.

They were spit out in the 1980 eruption. In the center of the crater, hot lava has oozed upward, hardening and creating a growing mound of rock that's now the height of an 80 story building. It's a geological paradise for researchers like Don Swanson of the US Geological Survey. This dome now is more than 800 feet high; it's more than 2000 feet wide. And it has grown rather continuously between late 1980 and late 1984. There are places up there in which we were able to measure temperatures as high as around 917 degrees Celsius. That's approaching 2000 degrees Fahrenheit. Geologists have studied the mountain all winter from this vantage point here in the crater. It's been a pretty sleepy winter. The lava dome hasn't grown any from its 800 foot level reached last September. And it's unclear what this recent inactivity means. It's very difficult to determine whether it's dead or whether it's sleeping. Rather than being quasi-dead for a matter of a few years, it may just be slumbering.

And that worries us a great deal, because what this means is that there's a possibility that the next eruption will be quite violent. The science of volcano prediction hasn't come too far in five years. Monitoring for earthquakes and for abnormal growth of the dome are still the main techniques. But Swanson says we're better off in one way than we were in 1980. Having seen what happened on May 18th, this gigantic landslide and the lateral blast and so forth, I think we would now be able to stress publicly much more than we did before that there was a potential for a very major catastrophic eruption to occur. The damage from the May 18th eruption was astonishing. The blast devastated more than 150 square miles in a broad sector north of the mountain with all trees and vegetation laid flat or killed. Enough wood to build a quarter million homes was blown down.

Timber giants Weyerhaeuser and Burlington Northern scrambled to salvage what they could on their land. So did the Forest Service. But a grassroots environmental group fought to save as much blown down timber as possible in its natural state, for scientists and tourists and the curious. If the National Monument had not been established, the Forest Service plans would have salvaged almost all of the timber that was blown down by the lateral blast, and the average person visiting the area would, by the time the public was allowed in, would see very little of what really occurred. Consensus politics resulted in a 110,000-acre national monument around St. Helens. That protects the mountain itself, Spirit Lake, and the Toutle River Valley at the bottom of the mountain, some old lava flows from previous eruptions, and a little blown down timber. Three people died here at Ryan Lake when a 250-degree blast wave came charging through this valley.

This lake basin will remain as is, as a monument to the destructive power of this volcano. Before the eruption, Spirit Lake was a tranquil setting beneath the north flank of Mount St. Helens. On May 18th, that tranquility was shattered by a 120-foot wall of mud. Among the victims buried beneath, 84-year-old Harry Truman, who didn't believe the mountain would hurt him. Mount St. Helens is my life, folks. I've lived there 50 years. It's a part of me. That mountain and that lake is a part of Truman, and I'm a part of it. His legend lives on in a movie starring Art Carney. Until last month, Spirit Lake, dammed by unstable log debris from the eruption, had threatened downstream communities with flooding, but the Army Corps of Engineers has just completed a mile and a half long tunnel to lower the water level and alleviate the flood threat. The scars of the mighty eruption, five years later, are still painfully evident. The Toutle River Valley, once fertile, still looks like the moon, not the earth.

What was once alive and lush and green is today stark, colorless, eerie, dead... unless you look closely. The forests of southwest Washington have been through this before. St. Helens erupted in 1857, and eight times before that. University of Washington botanist A.B. Adams. As far as a coniferous forest goes, we're dealing with 60 years at the earliest. But in terms of a forest that we don't have to lumber, but a forest, we're dealing with our lifetimes. We'll certainly see it come back. Two million tourists have come to marvel at St. Helens, and scientists have gathered shelves of data since May 18th, but they too can still only marvel at, and not predict, its behavior. Five years later, we're still at the volcano's mercy. Again, the major stories of this day: The government said economic growth slowed during the

first quarter of this year, but inflation remained low, increasing less than half a percentage point in April. And President Reagan told Republican leaders he is frustrated with Congress over Central America policy. Finally tonight, a joke. President Reagan has a reputation as someone who likes to tell jokes in private about the Soviet Union. Well, today, at a speech in Washington talking about his recent trip to Europe, he told one in public. One of the heads of state that I met with on this visit, he gave me one while I was on the way. Told me the story about the two fellas in the Soviet Union who were walking down the street, and the one of 'em says, "Have we really achieved full communism? Is this it? Is this now full communism?" And the other one said, "Oh, hell, no, things are going to get a lot worse." [laughter] Good night, Robin. Good night, Jim. That's our NewsHour tonight. We'll be back tomorrow night. I'm Robert MacNeil. Good night. The MacNeil/Lehrer NewsHour is funded by AT&T, reaching out in new directions. The Corporation for Public Broadcasting.

And this station and other public television stations. [outro music] [music] For a transcript, send $2 to Box 345, New York, New York, 10101.