captioning sponsored by macneil/lehrer productions >> lehrer: good evening. i'm jim lehrer. president obama created an independent commission to deal with the federal deficit and national debt. >> brown: and i'm jeffrey brown. on the "newshour" tonight, judy woodruff talks to the panel's co-chairmen: republican alan simpson and democrat erskine bowles. >> i believe we have a chance if we deal with trust, we pull all the facts on the table, to make progress. this is bigger than me, or erskine, or you. this is about, this is about the

future of america. >> lehrer: then, a look at the new nicks in u.s.-china relations keyed to the president's white house chat today with the dalai lama. >> brown: spencer michels reports from san francisco on one man's mission to send specially-designed wheelchairs around the world. >> not only do they need a wheelchair, but they need the best of wheelchairs because they have the worst of terrain. >> lehrer: a newsmaker interview with john holmes, the united nations chief aid coordinator, on the state of the relief efforts in haiti. >> brown: and paul solman continues his series on banking tonight with a former head of the federal deposit insurance corporation. >> lehrer: that's all ahead on tonight's "newshour." major funding for the pbs newshour has been provided by: >> every business day, bank of america lends nearly $3 billion to individuals, institutions,

schools, organizations and businesses in every corner of the economy. america-- growing stronger everyday. >> this is the engine that connects abundant grain from the american heartland to haran's best selling whole wheat, while keeping 60 billion pounds of carbon out of the atmosphere every year. bnsf, the engine that connects us. >> chevron. this is the power of human energy. the william and flora hewlett foundation, working to solve social and environmental problems at home and around the world. and with the ongoing support of these institutions and foundations. and...

this program was made possible by the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. >> lehrer: the president signed an executive order today, setting up a bi-partisan commission on the federal deficit. he did so as the issue grows in political urgency. judy woodruff has our coverage. >> there you go. >> it was a simple pen-stroke to take on a gargantuan task: finding ways to cut red ink projected to hit $1.6 trillion this year alone. >> without action, the accumulated weight of that structural deficit of ever- increasing debt will hobble our economy. it will cloud our future. and it will saddle every child in america with an intolerable burden. this isn't news. since the budget surpluses at

the end of the 1990s, federal debt has exploded. >> woodruff: that explosive growth has been fed by the cost of two on-going wars; ever- expanding social security and medicare payments-- and since the financial crisis, bank and automaker rescues and falling tax revenues. the president's solution: an 18 member "commission on fiscal responsibility and reform" with appointees from both parties. at its helm, co-chairs-- democrat erskine bowles, who was white house chief of staff for president clinton, and alan simpson, the former republican senator from wyoming. >> i'm asking them to produce clear recommendations on how to cover the costs of all federal programs, by 2015, and to meaningfully improve our long- term fiscal picture. >> woodruff: mr. obama said, "everything is on the table," in a bid to cut the deficit to 3% of the nation's gross domestic product-- down from

well over 10% this year. the recommendations will not be binding. but republicans immediately warned the panel will be weighted toward democrats and liberal groups and is likely to focus on higher taxes. in a statement, senate gop leader mitch mcconnell said: "after trillions in new and proposed spending, americans know our problem is not that we tax too little, but that washington spends too much. that should be the focus of this commission." mr. obama had wanted congress to form a commission with the power to force lawmakers to vote on deficit cuts after the november elections. that idea failed in the senate last month. i sat down with the two chairs of the president's new commission in the eisenhower executive office building this afternoon.ñg

and/called erskine and he said, you know, what we need to do is push the balfour ward and do it for our grandchildren. that's what we're here for. sounds corny, i know, but that's the way it is. >> woodruff: erskine bowles, help people understand how overwhelming is the job you've been asked to do? >> it's staggering. we have a deficit-to-g.d.p. ratio today of 10.6%. we got $1.6 trillion in new debt coming on to the country.

judy, i'm a university of north carolina now and i know if we don't get our people educated, we're going to be a second-rate power before you know it. and if you just think about the interest on the national debt over the next ten years it's going to increase by $650. that $650 billion we could spend on innovation, on research, on education. if we don't do things like that, we're not going to be able to compete in a knowledge-based global economy. this is a big, big issue. >> woodruff: it's a big issue, senator, but it's something that nobody else has been able to do for the last several decades. what makes you think you can get something done? >> well, i've been on some groups that did that. i was on the select commission on immigration refugee policy which was chaired by father ted hesberg and we came up... i think it was the first commission i'd been on where we came up with legislation. we did a legal immigration bill and an illegal immigration bill and then i was on the iraq study

group where, you know, ten americans, five democrats, five republicans unanimously agreed, i know it can work if people are of good will. >> woodruff: well, some people-- mainly republicans right now-- are arguing what's really needed are tax cuts. that even if it raises the deaf it? the short term that this would deaf government out of the way of business, business could grow and the deficit will take care of itself. >> well, i'm not smoking that same pipe. i just... everything is on the table. but if we're just going to use flash words like cutting children's benefits or cutting veterans or raising taxes it will be a tougher struggle. everything is out there. we... i know how to... how people use emotion, fear, guilt, and racism. i've been through that old stuff with immigration. if those... i say to them i don't use those, i use facts, and we're going to do a lot of

facts. >> woodruff: so erskine bowles, most economists economit down and you talk to them seriously say it's got to be a combination of tackling the entitlement programs like social security, like medicare, modifying the way those programs work and, frankly, raising taxes. i mean, are those things that you're going to be seriously considering? >> judy, i think the great thing is when alan and i talked to the president the very first time and every time since he stressed two things: this has got to be bipartisan to work. it can't be a republican, it can't be a democrat thing. this is a challenge for the country. and second he has insisted that everything be on the table. and that's everything. >> woodruff: and that includes tax increases for the middle-class. >> if you start by taking something off, we'll never get there. he has said everything is on the table. >> and, again, it's just a flash word. the last time they did the social security correction, they tweaked the system. i think it was one-tenth of one

percent of the payroll tax. well, if that makes people sleek and go over the edge of the cliff, you have two choices with social security, you either raise the payroll tax or decrease the benefits or start affluence testing, try that one on. man, oh, man, there's a big one. but the rest of it is b.s . and if the people are really ingesting b.s. all day long i their grandchildren will be picking grit with the chickens. (laughter). >> woodruff: but there are people out there just waiting forking? like that to happen. in fact, there was congressman from georgia today, tom price, a republican, who said the fact that the president's already putting i think a couple more democrats on this 18-member commission than he is republicans means he's said the odds are high that your recommendations are going to be heavy on tax increases and light on spending recommendations. >> to jump to that conclusion just doesn't make any sense.

because first of all, you know, it takes 14 votes out of the 18 to make any recommendation at all. so six people being appointed by the republican members of congress are going to be able to veto any legislation or anything coming out of this. >> see, this guy is missing the boat. this is soundbite business and that's great, that gets you reelected. but it won't help the country. >> woodruff: senator simpson, there is at the same time an atmosphere in this city, people call it a hyperpartisanship, just a bitter division between the two parties. and right now you've got quite candidly leaders in the republican party, majority leader boehner, senator mcconnell, who initially resisted the idea of even appointing anybody to this commission. >> but now they're going to do it. and i visited with both john and mitch and told them what i was going to do. and i said, you know, i hope you can help, i hope you'll appoint some good people and they said "we'll talk." and i understand that they're making... they're going to make

selections. that's all we can ask. >> woodruff: speaking of this atmosphere of partisanship, erskine bowles, how much harder does it make your work? i mean, how do you compare it to the time you were in washington with president clinton. >> look, this is going to be very difficult. make no mistake about it. but i can tell you, when president clinton announced he was bringing me back to washington to be chief of staff to "balance the budget," i can remember going on tim russert's show and nobody, not even tim, believed it was possible that we had a chance of bringing both sides together. and we negotiated what became the first balanced budget in a generation. and i believe we have a chance if we deal with trust, we put all the facts on the table, to make progress. >> woodruff: but don't you think the partisanship is even worse now? >> i think it's very tough. >> i think it's worse than i've ever seen but that doesn't mean we should just hang up the phone and let this engine come down the track with no brakes on.

and that's what's happening. this is ang engine with no brakes. >> woodruff: finally, you mentioned what congress tried to do, it didn't work. the congressionally created commission to tackle the deficit. unlike that commission, this commission does not have... whatever you recommend is not going to be binding. you're going to make some recommendations, but they're not going to... nobody in congress is required to enact this. so how do you make it... how do you translate what you do? >> i think if you go back and look at alan's commission, the one you just did, the iraq study commission, over 40 of their recommendations have been brought into law today. i believe that if we put the facts on the table and provide the administration and provide the members of congress some real information and the american people understand that you can't just tweak this and get to the bottom line, i think we've got a chance to really advance the ball. >> but we'll be called naive,

i'll be called a robe toady, rush babe will be after me day and night. it's going to be a thrilling experience. but i've been there before. but this is bigger than me or erskine or you. this is about the future of america. this country is going to go to the bow-wows unless we deal with the entitlements and social security and medicare. >> i'll have the same problem from the left when we start talking about entitlements. but we have to tell the truth. >> and we're going to. i think people will trust us. i hope that's the case. at least so far so good. they'll say "i don't like simpson but the a nut is half right sometimes." and so i have no illusions about this. my dear wife anne who you know, she said "al, what are you doing?" i said, well, it's for the cause, it's for our grand kids. she said "carry on, here's a sandwich, head out the door." and a brown bag lunch. >> woodruff: so you do expect

to take flak? >> oh, you bet. (laughs). >> and you know how we'll beat them? with humor. humor is the universal solvent against the abrasive elements of life and when they hammer on us... people who hammer on you are humorless. they don't know what a smile is or. (laughter) er the. they're 100%ers, they've got b.o. and heartburn and gas. those people are easy to handle. they get irritated and call us silly people. that's how that works. >> woodruff: we will be watching. >> i know you will! >> woodruff: thank you very much. senator alan simpson, erskine bowles, thank you both. >> thank you. >> brown: and now, the other news of the day. here's hari sreenivasan in our newsroom. >> sreenivasan: fighting intensified today in a taliban haven in southern afghanistan. four more nato troops were

a small plane crashed into a building in austin, texas today and federal officials said it appeared to be deliberate. fire and heavy smoke engulfed the seven-story building that housed offices of the internal revenue service. investigators said the pilot denounced the agency in a suicide note he posted online. the man was identified as joseph andrew stack. the local police chief said there was no sign of any larger plot. >> i know the number one fear that's coming to everybody's mind is there is an act of terrorism, and is the country, the city, the region in danger? i can tell you, categorically, that there is no cause for concern from a law enforcement or a terrorism perspective. >> sreenivasan: at least two people were injured in the crash. one person in the building was listed as missing. fighting intensified today in a taliban haven in southern afghanistan. four more nato troops were killed raising the total to ten since the offensive began last week. u.s. marines and afghan forces controlled main roads and government centers in marjah, but they also said there were pockets of stiff resistance as well as snipers. the british commander of nato forces in the region said it could take a month to secure the entire area, and even longer to measure success.

>> in three month's time or thereabouts we should have a pretty fair idea about whether we've been successful. but i would be very cautious about try yum fans just yet. it's going well and there are a lot of brave people doing a lot of brave things and i'd be recently confident in due course we'll announce a successful operation. >> sreenivasan: senior u.s. marine officers said more than 120 insurgents have been killed in the operation so far. a bomb tore through a mosque in pakistan today, killing at least 29 people and wounding 50 others. it happened in the khyber tribal region. police said some of the dead belonged to lashkar-e-islam, an insurgent group. the bombing came as the u.s. special envoy to the region-- richard holbrooke-- was visiting pakistan. he met with government leaders in islamabad. and in iraq, at least 13 people died in a suicide car bombing in the west. the blast exploded in downtown ramadi, where attacks have escalated in recent months. the bomb targeted the governor's office, police headquarters, and courts.

a major new case of computer hacking has been uncovered. the security firm "netwitness" reported more than 2,500 corporations worldwide had their computer systems compromised, starting in 2008. a virus-- known as a "botnet"-- invaded the computers and used them to steal data from commercial and government systems. among other things, the hackers have gained access to e-mail systems and online banking. the obama administration warned today of double-digit increases in health insurance premiums. the department of health and human services cited proposed hikes ranging from 23% in maine hikes ranging from 23% in maine to nearly 40 percent in california. secretary kathleen sebelius said it highlights the urgent need for health care reform. >> we're seeing this at the same time where not only is there an economic downturn around the country but we know that insurance companies are not suffering that same kind of downturn. the five largest insurers in america have declared more than $12 billion worth of profits in 2009.

>> sreenivasan: for their part, insurers said they need higher premiums to cover rising medical costs. they also said many healthy people are dropping coverage, leaving a shrinking pool of older, sicker customers. the federal reserve has announced the first step toward unwinding its financial rescue programs. it raised the interest rate today on emergency loans to banks. the move has no effect on consumer borrowing. and wall street rang up gains for a third straight day. the dow jones industrial average added more than 83 points to close near 10,393. the nasdaq rose 15 points to close at 2,241. former new york city police commissioner bernard kerik now faces four years in federal prison. he was sentenced today after pleading guilty to lying about taxes and other financial dealings. the charges stemmed from statements to white house investigators in 2004, when kerik was nominated to be head of homeland security. he ultimately withdrew from consideration.

at the winter olympics in vancouver, canada-- american athletes went looking for more wins after taking six medals on wednesday, the best day ever for the u.s. at any winter games. today, in the women's super- combined ski race, the gold went to maria riesch of germany. she beat out american julia mancuso, who took silver. tonight's highlight is the men's figure-skating final. those are some of the day's main stories. i'll be back at the end of the program with a preview of what you'll find tonight on the "newshour's" web site. but for now, back to jim. >> lehrer: and still to come on the "newshour": a man who gives the gift of mobility; a united nations official on haiti relief efforts and another paul solman conversation about banks. >> brown: but first, a washington meeting raises the tension level between the united states and china. >> brown: a warm welcome for the dalai lama early this morning outside the white house. inside, the official reception was more low-key and private.

this was the only photo the white house released of tibet's spiritual leader meeting with president obama. afterward, the 74-year-old dalai lama said he was very happy with the meeting with his fellow nobel peace laureate. >> i always admire america, not economy, military power as as democracy, freedom, human creativity. >> brown: a white house spokesman said the president commended the dalai lama's commitment to non-violence and pursuit of dialogue with china. but donald lopez-- a tibet specialist at the university of michigan-- said the dalai lama is hoping for strong american advocacy. >> i think the dalai lama would like obama to make the tibetan case to the chinese. in this particular instance, it é(buld mean higher level, more serious negotiation about the

return of some cultural and religious autonomy to both the tibet autonomous region and the large tibetan ethnic population in neighboring chinese provinces. >> brown: tibet has been under chinese control since 1950. the dalai lama is considered a separatist by beijing. he's been in exile since a 1959 uprising. on sunday, in washington, he marked a more recent uprising against chinese rule in 2008. >> people are grieving in many parts of tibet. >> brown: china crushed the protests of two years ago, and tibet remains in a virtual lockdown. >> the situation in tibet is more repressive than it's been probably in over a decade. a higher security presence, more restrictions on travel. people who write poems about the dalai lama are thrown in prison, there is just a much higher level of tension. >> brown: china has opposed all meetings between foreign leaders

and the dalai lama. and the foreign ministry said it was "strongly dissatisfied with today's white house session." but it said nothing about retaliation. last october, president obama declined to meet the dalai lama before a summit with the chinese. and, while in beijing, he was careful in how he addressed the issue. >> the united states supports the early resumption of dialogue between the chinese government and representatives of the dalai lama. >> brown: the u.s. does recognize tibet as part of china. but the issue remains a tense one. just part of a relationship that's grown increasingly complex as china gains strength within asia and globally, a sentiment reflected on the streets of beijing. >> ( translated ): i feel that our country is strong now, so we really don't have to give in to the u.s. on every matter. >> brown: the last several months have seen a series of flashpoints.

the recent u.s. announcement of a $6 billion arms sales to taiwan angered beijing. last month, google revealed extensive chinese hacking of its users' e-mail accounts, including those of human rights activists. and in december, china and the u.s. deadlocked over how to reach a deal on climate change at the copenhagen conference. in addition, china's halting cooperation-- or outright opposition to action-- on the iranian and north korean nuclear issues has complicated any efforts to rein in those states. then there are the economic issues. china holds hundreds of billions of dollars in u.s. government debt. it had become, in effect, a major stakeholder in the american economy. china also maintains a huge trade imbalance with the united states. according to u.s. officials, keeping its currency artificially low so that chinese exports are cheaper to buy. >> brown: and for more on all this we turn to susan shirk, director of the university of

california's "institute on global conflict and cooperation"-- she was a deputy assistant secretary of state during the clinton administration. and gordon chang, who lived in china and hong kong as a lawyer for american and international law firms. he's an author and writes a weekly column for forbes.com. gordon chang, starting with you. how significant is this, was this meeting with the dalai lama? >> i think it was significant because it shows a recalibration of american policy. president obama came into office with an especially conciliatory policy towards china. he didn't see the dalai lama in october, as your piece noted. he had a very difficult summit with the chinese in november and in december on an issue very important to the president, the chinese snubbed him in copenhagen at the climate change talks. so i think what we're seeing is really a rethinking of china policy and essentially this meeting today is a signal to beijing that things might be different in the future. >> brown: susan shirk, what do

you see in a meeting like this in is it symbolic? done for show? is this a real impact out of it? >> well, i disagree with gordon. i see it as completely consistent with what past presidents have done. the chinese knew that president obama would neat dalai lama. he always intended to. he simply wanted to go to beijing and make the case for dialogue with tibet before meeting with him. and i'm sure today he was debriefing the dalai lama on those discussions. >> brown: let me try to frame this debate that you've just started, gordon chang, starting with you. we just listed a number of areas of tension. does it add up to a more aggressive, a more assert i have stance by china? >> well, certainly, you know we've seen it was... google where they complained about information imperialism. then you had tibet where they threatened to injure the american economy.

on taiwan they publicly said they might sanction u.s. companies for selling arms to taiwan. they have never done that before. you know, clearly over the last six months china has been more assertive. i think it's partfully response to what they saw as american policy, they were testing the president. and also there may be some problems inside the regime in beijing. succession problems, things like that. it makes it more difficult to compromise with the u.s. when people are jockeying for power. >> brown: do you see that, susan shirk? a more aggressive stance? >> well, i do see greater assert iveness in china's public statements. and i myself attribute that to domestic developments in china, especially because china recovered first from the global financial crisis, the global financial crisis was caused primarily by problems with the u.s. financial system. and this has led to a misperception on the part of many people in china that the

chinese economy is already the strong nest the world. if you look at the pugh surveys, it's striking how rapidly public opinion in china has changed in its perceptions of chinese strength. so that creates a demand from the public to the leadership which, because of its own insecurity, is actually quite responsive to public opinion in china today. >> brown: but do... go ahead. >> so i see this not as a reflection of obama policy but caused by domestic developments inside china. >> brown: staying with you for a moment, do those domestic developments reflect a kind of... represent any sort of threat or dinger to the united states? >> no, i don't think they do because in china tough words are sometimes a substitute for tough action. so i think we need to look very carefully at what china is

actually doing and there i think the signals are mixed. for example, they just allowed the united states aircraft carrier "nimitz" to visit hong kong and in the past they've sometimes canceled those visit because they were unhappy with something that we have done. so i think they'll continue to be quite noisy, especially on issues like taiwan and tibet, but i think they'll continue to see that their long-term strategic interests lie in a decent, cooperative relationship with the united states. >> brown: what do you see, gordon chang? something a little more of a threat than that? >> i think we're going to really see something when the u.s. goes to the u.n. security council and wants a fourth set of sanctions on iran. >> brown: you mean you see that as a real flash point? >> that as a flash point and that's a real test of china's

ability to work with the international system because now even russia, which was the primary backer of iran, is thinking of sanctions. certainly western europe is. only the chinese at this point don't want to see more coercive diplomacy. and right now this is a matter of first importance for the united states. chinese media has said that in connection with tibet and taiwan, you know, if the united states doesn't cooperate with us, we will not cooperate with the united states on core international issues of importance to them. so, you know, this will really be the test of whether beijing is going to be especially hostile or whether it will, as susan says, work with the international community. >> brown: but from the u.s. side, you were talking earlier about this meeting as suggesting a recalibration of u.s. policy. is that something you think is needed? has u.s. policy been ineffective given the kind of internal changes or however you want to think of it as changes or threats that we see in china? >> i think over the last two or three months it's difficult to

make the case that u.s. policy has been affected in moving the chinese in better directions. we saw copenhagen, for instance, the reaction on taiwan was really outsized. the way they're dealing with the google issue i think is deeply, deeply troubling. and so i think we really do need to look at our policies and hopefully push the chinese in a better direction. and i think we really need to change what we're doing at this point. >> brown: susan shirk, what do you think about u.s. policy? is it a question of managing these differences, somethat that is doable or do we need a more aggressive stance of our own? >> well, i think the obama administration approach has been consistent with what every administration starting with nixon has done, which is to try to find a basis for cooperating with china while maintaining our own national strength. and i don't see, really, any

significant differences in the obama administration approach. and i think that we need to keep a calm hand on the tiller, not overreact to chinese rhetoric with rhetoric of our own and just basically continue the efforts to try to work together with them. but i do agree with gordon that the united nations action on iran will be a very important test. and if beijing actually vetoed-- which i don't think really will happen-- but is the odd person out, the odd country out on iran's sanctions, then that will be a new kind of approach on china's part which would cause me great concern. >> brown: all right, there's one next test and then we'll watch for others. gordon chang and susan shirk, thank you both very much. >> thank you.

>> lehrer: delivering mobility for those most in need, "newshour" correspondent spencer michels reports. >> reporter: the heart-wrenching scenes from the earthquake in haiti-- the pictures of haitians with crushed or missing limbs have inspired a special kind of response from thousands of miles away. >> we could see people with new disabilities every day, and we knew already there was a great shortage of wheelchairs in haiti. >> reporter: ralf hotchkiss rides his own wheelchair around the campus of san francisco state university where, for 22 years he has run a non profit that develops sturdy, low cost wheelchairs for underdeveloped nations and arranges for their distribution. with estimates of more than 2,000 amputations in haiti, hotchkiss' contacts there in the

disabled community let him know immediately that thousands of haitians would be needing the kind of chair he and his colleagues-- at whirlwind wheelchair international-- have built and improved, and distributed around the world. >> we're having so far 350 chairs made in vietnam and mexico, and all sent to haiti to be distributed to people both with spinal cord injuries and with amputations, usually dual amputation, who absolutely have to get mobility soon, before it's too late. >> reporter: what they'll be getting-- courtesy of non- governmental organizations-- are wheelchairs priced about $200 manufactured in small independent factories around the world. those chairs are designed in this mechanical engineering lab in san francisco, which is where hotchkiss and his staff teach design and construction. hotchkiss got involved 44 years

ago after he was paralyzed in a motorcycle accident. he learned fast that wheelchairs, even ones that cost several thousand dollars, weren't very practical. >> my first wheelchair lasted me half a block, and the front wheel was then ripped off by hitting a crack in the sidewalk. it was beyond repair. >> reporter: as an engineer, he began studying and observing wheelchairs. >> we started at the end of 1979 in nicaragua. i met some young fellows who were sharing one wheelchair. i was riding a homemade, fairly high tech chair at the time. they looked at my chair and said, "well, we know it's going to break in a couple of places," and i know they were right. >> reporter: he got some funding to do research and started working, by hand, putting together parts, like bicycle tires, to make the chairs stable, more durable and more useful in the rough terrain that

is so prevalent in third world nations. his latest model, the rough rider, is in use in many poor countries, and in fact, 50,000 whirlwind wheelchairs have been bought over the years by non- profit groups and then given away. hotchkiss and his staff test his theories on hills and in flower beds near the college science building. >> there are parts of it that require the same skills that are required to go over unpaved roads and up and down rutted trails. our chairs have a much longer length between the front and rear wheels than a typical chair. we've tucked the footrest behind the front wheels instead of hanging them way out front like a cow catcher. we've also gone to mountain bike rear tires, and thank goodness those are more and more available all over the world. >> reporter: whilrwind

wheelchairs are easily repaired and modified key elements in the poor nations. hotchkiss insists that everyone in his class and on his staff-- and most are not disabled-- ride a wheelchair. laura hunt is a senior majoring in anthropology. >> it's definitely made me realize that accessibility is a completely different world. unless you're in a wheelchair, and get first hand experience, you don't often think of the small things, like being able to get the napkins in the dining center, or getting a fork, or how steep the grade is on this campus. >> reporter: for his role in raising awareness of the needs of the disabled and for his efforts to fill those needs, hotchkiss was awared a macarthur hotchkiss was awarded a macarthur genius grant. his concern is worldwide, and he says that haiti's need for wheelchairs is hardly unique. >> there are easily 25 million

people in the developing world who need a wheelchair today, and don't have one. >> reporter: 25 million? >> and not only do they need a wheelchair, but they need the best of wheelchairs, because they have the worst terrain and they go the longest distances, no cars, no buses with lifts, they have to miles to get to work, to school. >> reporter: as hotchkiss and his crew work to get rough riders to haiti and other third world nations, they are also looking bring durable, inexpensive wheelchairs made in vietnam and mexico to the united states, at a cost disabled americans can afford-- well below what they pay today. >> lehrer: now, an update on haiti, five weeks after the earthquake. ray suarez has our story. >> suarez: heavy rains began falling on haiti today. it brought mud and more misery to nearly 600,000 homeless people living tent camps around port-au-prince. and overnight, eight american missionaries who'd been accused of child kidnapping returned to the u.s.

they flew to miami on a u.s. air force plane, before going on to final destinations in texas, missouri and idaho. they could still be called back to haiti for more questioning. two others, including the group leader, remained in jail. they face a haitian court hearing tomorrow. and joining us now is the united nations point man for haiti humanitarian efforts, under- secretary-general john holmes. mr. holmes, you've just recently been to haiti. what's your assessment 5r the relief and recovery efforts so far? >> i think you can say that we've made very good progress in some areas. i think we've solved a lot of the immediate emergency medical problems one way or the other with a lot of help from many organizations around the world. i think we're where we need to be in terms of provision of fresh water. we can still do a bit better but watter is not a problem. i think food is out there in much larger quantities than before. i think everybody who needs some

food has now got some food more or less. i mean, i'm sure you can find someone who hasn't received some aid but that's largely a problem which we're getting on top of. what we need to do is step up further because we have a lot to do in areas like shelter and sanitation particular particularly because, as you say, the rainy season proper when there are very heavy rains is a few weeks away and we need to make sure everybody's got a roof over their heads, the best san separation available so they're comfortable but also particularly we avoid the outbreaks of disease which can easily come in in rainy conditions, particularly in conditions of poor hygiene. so i think those are the biggest problems we face right at this moment. >> suarez: in those first terrible days right after the earthquake, people and materiel poured into haiti and nobody seemed to be in charge. everybody sort of did what they were good at, whether they were doctors or handing out food or trucking in supplies. is there somebody in charge now? is there an overall intelligence coordinating relief efforts?

>> well, there always was and that was us. whether you thought we were visible or not, that's what we were doing. there was a system which is tried and tested for disasters. and which has been improved since the days of the tsunami. we have a system where all the agencies and organizations, n.g.o.s and others working in particular areas, whether it be health or food or water or shelter get together, decide who's going to do what where, portion out the task, make sure there's no duplications, go gaps. does it work perfectly? of course not. particularly in the first few days of the inn evidentable chaos after the disaster. and particularly in a place like haiti with a catastrophe of that size tens and hundreds of organizations working in the same sector. but it is a lot more organized than it might seem from the outside and these systems do work even if sometimes the immediate visible results on the ground are a bit slower than the media would like them to be and, of course, more importantly than the people waiting for their that help might like them to be. >> suarez: in an internal memo written by you that's been

widely circulated you talked about the things that need to be done quickly that haven't been done yet. what did you identify as some of the shortcomings? >> what i was talking about, and trying to both appreciate the progress we've made but recognize the scale of the task we still faced ahead of us in the next weeks and months, was to talk particularly about this shelter and sanitation issues where do do have to have a real surge in the next few weeks equivalent to the food surge we had a couple of weeks ago. i was also talking in rather technical terms about the kind of human resources that are need to run these clusters, to run these sector arrangements in a disaster which is of the magnitude of haiti. now, i say i don't think you should take what i said in that e-mail-- which is a private e-mail not for circulation, not for scrutiny by the media-- as being criticism of the operationment it's more encourage. but given the scale of what we face we have to do better. today we've launched a new revised appeal for the immediate needs of haiti and the early recovery needs and that covers these areas like food, shelter,

water, sanitation, but also looking ahead a little bit further cash for work so that haitians themselves cans get to work clearing the rubble, clearing the waste, getting some money in their pockets. and also areas like education and agriculture where we need to restart things quickly so people have got livelihoods, children go to school. so we've been... we're launching that appeal for the next 12 months and i hope donors will continue to be generous for that. >> suarez: the wa +*-based inter-american development bank just released a report by their lead economists looking at the problem and they estimated 7.2 to $13 billion price tag for haitian recovery over the medium and long term. does that sound about right to you? >> well, i'm sure it will be billions and billions of dollars there was a separate assessment under way, this was in the long-term not necessarily my emergency field, called the post-disaster needs assessment which the u.n., the world bank, the inter-american development bank and other major actors are doing together and that's designed to produce the proper

needs assessments, priorities, time scales for the reconstruction and redevelopment aimed at donor conversation at the end of march here in new york and i think that will be a very important moment to see exactly what the needs are and what the plan is. of course former president clinton will be playing a very big part in that, too. >> suarez: in all these various areas, food and water, medical, shelter and so on, work, there are assessments ongoing as you mentioned. has a full accounting or a closer to full accounting of the human costs been done? what are the figures that people are working with for the dead, wounded, and displaced? >> well, the figures we have are the figures given by the government. i think the latest figures are around. 220,000 people killed, 300,000 people injured, more han a million homeless, half the people who left the capital to go to other areas of haiti. now, i don't know exactly whether those figures are right, there's no way of telling at this stage and we may never know the exact figure bus i think they're the right order of

things and they do give some indication of the sheer magnitude of this disaster. and the particular feature of it which we need to keep bearing in mind, it hit the capital of the country, hit the government of the country, so that made the response and, indeed, the recovery that much more complicated and slowed it down as well. >> suarez: do you have reason to believe that after this initial surge of concern, this outpouring of generosity, that the world has the attention span to keep on with haiti over what you're saying is a much longer recovery period? >> i think that will be a real test for the international community. as you say, it's easy when the media scrutiny is there, when everybody's sympathy is caught by the dreadful scenes we saw. to talk about it. to be there five years later still offering help to a country which will desperately need that help in five years or maybe even in ten years, that's a much bigger challenge. the flood lights of attention do tend to move on. and that's where i think that we need to do things differently from the way we've done them in

the past. we need to rebuild haiti not as it was before but much better. and that's also where i think president clinton can again play a role in keeping everybody's noses to the grindstone, keeping everybody at work, making sure they don't forget about haiti and that we don't miss this opportunity because a disaster is an opportunity if you take it, but it will take a lot of time and attention in a way which perhaps the international community is not always good at. >> suarez: you've written in your leaked memo of the necessity of putting in place right t right plan. do you have this feeling that time is being lost right now? that there are... there's a plan that needs to be put in place quickly in order for the situation not to... this opportunity that you described not to be lost? >> well, i think we need to move fast. i mean i was talking there again about the emergency needs. we need to define very clearly what they are for the next three to six months and that's, of course, the appeal what were launching today was about. i think for the longer term we need to have a quick plan but it's very important to get it

right and it's very important to get it right in the sense that it needs to be owned by the haitians. it need to be something which the haitian government believe in and the haitian people believe in and that they can do. what we don't want is something which is devised by the international community seen as being imposed by the international community and it will never take root in a meaningful way. that's more difficult but we do need to get that part of it right even if the institutions of haiti were weak before. >> suarez: u.n. undersecretary-general john holmes, thanks for joining us. >> thank you. >> brown: and finally, "newshour" economics correspondent paul solman continues his conversation series on bank reform and the future of wall street. last night, we heard from a former-regulator-turned-critic, bill black. tonight, paul gets a very different view. it's all part of his ongoing reporting on "making sense of financial news." >> reporter: william isaac, chair of the federal deposit insurance corporation during the reagan administration.

he's now a bank consultant. a critic from the start of the treasury's "troubled asset relief program," conceived to strengthen banks and other financial institutions during the financial crisis, he's also come out against president obama's proposal to tax banks that received tarp funds. i sat down with him recently to hear more. william isaac, welcome! >> thank you, good to be here. >> reporter: the administration's proposal just being floated to get back the tarp money-- what do you think of it? >> there are some really serious problems with that. one is the bank portion of the tarp is almost certainly going to be highly profitable. they're not going to lose any money on the banks that participated in tarp. they are going to lose money on a.i.g. in all likelihood. they'll probably lose money on general motors and chrysler, but they actually are going to make a fair amount of money on the banks that were in tarp. and whatever the government made, it's a lot more than governments borrowing cost. and so i don't think taxpayers have any complaint about tarp.

>> reporter: so what's wrong with the idea? it's just not fair? >> well, that's part of it, it's not fair to tax the banks for money they gave away to the car companies which congress never intended that they should do. that's not fair. but bringing it home to u.s. citizens, it's foolish. we've got banks that are undercapitalized, are paying inordinate amounts right now for the cost of deposit insurance. they just sent a check to the f.d.i.c. for $45 billion. >> reporter: collectively. >> collectively. and, and so they're having to pay higher increased, you know higher costs for f.d.i.c. premiums, they're having to raise their capital standards. we've decided they've got to bring all the securitizations back onto their books which requires even more, higher capital standards. now we want to tax them and take more money out of the banks and yet at the same time we say, "why aren't you banks loaning money?" now you can't have all those things happen at the same time. and right now, i think what's most important for us as a country is we need to get the

economy going again, and get lending going again in the banks. >> reporter: you understand don't you that arguing to the extent you are on the behalf of the banks is kind of like these days arguing on behalf of swine flu! i mean, you are defending an extremely unpopular position! >> no, i don't think so. i'm arguing for the american people. keep in mind i was adamantly opposed to tarp. i think tarp was a horrible thing that the congress did. we didn't need it and i was upset as any tea-partygoer there is about tarp. it was a waste of our money, we should not have done it and it frightened the public, and it made our economic system far more shaky than it needed to be. and so i'm not defending the banks, i'm arguing that i want the economy to get going and we can't get the economy going if banks aren't lending and banks cant lend if you're taking the money away from them by taxing them right now. >> reporter: everybody i talk to from george shultz to paul krugman says, "too big to fail

is a problem; we have to do something about it." are they right? >> yes. the top 10 banks control something like 70% to 75% of the financial assets in the country. i think that really high concentration makes me uncomfortable. i would like to see our financial system be less consolidated, less concentrated. >> reporter: so what would you do about it? >> there's a whole lot of things i'd do. i would change the regulatory structure. i would consolidate these regulatory agencies and have more effective supervision than we have. as we get out of the recession and things begin to settle down, we need to aim for much higher capital standards on our major banks. the smaller banks already had a lot of capital and i don't think they're the issue. we also need to deal with a whole host of highly pro- cyclical regulatory rules and accounting rules that made this crisis much worse than it needed to be.

>> reporter: and by pro- cyclical, you mean that the policies exaggerate the good times and exacerbate the bad ones. >> precisely. if you're in good times it makes the good time more frothy, and if you're in bad times it makes it really hard to get out of it. you're in a downward cycle and you cant pull yourself out. >> reporter: with regard to wall street, should we shrink the financial institutions that are there down to a much smaller size? >> i'd rather let the markets sort that out. if they're not performing a useful function, the market will take care of them in due course. what i do think that we ought to bring back up is the issue of glass-steagall which was enacted in the 1930s to separate the commercial banks from the investment banks, wall street from main street, and that was liberalized gradually over time and in 1999, the congress eliminated it. i was in favor of its elimination and my good friend paul volker was opposed to its

elimination and as i look back on our experience over the past 10 years or so i think paul was right and i was wrong. i thought we could regulate better than we have and i thought we could control that, and i don't think we can. >> reporter: bill isaac, thank you very much! >> lehrer: again, the major developments of the day: president obama signed an executive order setting up a bi-partisan commission on how to cut the federal deficit. fighting intensified in parts of a taliban stronghold in southern afghanistan. four more nato troops were killed. and a texas man flew his small plane into an austin building housing offices of the internal revenue service. federal investigators said he was angry at the agency, and left a suicide note on the internet. the "newshour" is always online. hari sreenivasan, in our newsroom, previews what's there. hari? >> sreenivasan: there's more on

the china story. you can read what experts have to say about where u.s.-china relations stand today, and watch the full video of the dalai lama's remarks after his meeting at the white house. plus, find our complete coverage on the disaster in haiti, from reports on the immediate aftermath of the quake right up to our latest updates on recovery and relief efforts. also, you can watch the entire series of paul solman's conversations on the banking industry. that's on his "making sense" page. and finally on the "rundown" blog, watch a jeffrey brown conversation with the author of a new biography on reporter, politician and media baron joseph pulitzer. all that and more is on our web site, newshour.pbs.org. jeff? >> brown: and that's the "newshour" for tonight. i'm jeffrey brown. >> lehrer: and i'm jim lehrer. we'll see you on-line and again here tomorrow evening with mark shields and david brooks, among others. thank you and good night. major funding for the pbs newshour has been provided by:

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