February 16, 2002

Small rural communities stretched across America's southern tier are teetering in first post-globalization recession, and may never recover; freer trade benefits American consumers and industries that can now buy cheaper imported commoties, but foreign competition has been rough for towns that have formed base of national supply chain; for many rural communities, industries that have been declining for years may be dying out; photos; map (M)

Clyde Haberman NYC column on how city government has for years been weirdly incapable of installing public toilets, amenities that grace streets of major cities across globe (M)

Correspondence between Enron executives to George W Bush when he was governor of Texas includes more than two dozen letters in which Kenneth L Lay, former chairman, repeatedly lobbied for his company's pet issue, electric deregulation, sought Bush's presence at Enron-related functions and sent magazine articles and personal notes; Lay was involved in variety of pressing state issues, including education, civil justice reform and electric deregulation and asked Bush to lobby state's Congressional delegation on federal matters important to Enron, including tax relief; photo (M)

Morgan Stanley pays Philip J Purcell, its chief executive, $12.8 million in cash and stock in 2001, down from $21.9 million in 2000; analysts say cut of more than 40 percent is probably in line with cuts given to top executives of other major Wall Streets, which have been struggling through slide that has lasted almost two years (M)

Report on changes for the better in Soundview neighborhood in the Bronx in three years since Amadou Diallo was shot to death by police; photos (M)

Cheney Defends Iraq Stance Addressing the Council on Foreign Relations, Vice President Dick Cheney offered a strong rebuttal to allied critics of the Bush administration's attitude toward Iraq. PAGE A8 Milosevic Seeks Witnesses Slobodan Milosevic said he would call present and past world leaders, including Bill Clinton, to testify at his war crimes trial. PAGE A3

Enron discloses that Kenneth L Lay sold $100 million in Enron stock last year, including $20 million sold after he was warned by Sherron S Watkins that company might collapse 'in a wave of accounting scandals'; it is not clear how much profit Lay made on sales, many of which came while he was encouraging Enron employees to buy shares; Lay previously disclosed selling $29.9 million in shares in public markets from Jan through July; new disclosures show he took in $70.1 million from selling Enron stock back to company from Feb through Oct; spokeswoman for Lay says sales were unrelated to developments at Enron, including Watkins letter; despite sales, family members say Lay faces serious financial difficulties as he struggles to repay loans taken out to make investments, many of which have lost value; time line matches events at Enron last year with Lay's sales of company stock (M)

KLUG'S COMEBACK -- Chris Klug, a liver-transplant survivor, won a snowboarding bronze. PAGE D1

Germany's Patric-Fritz Leitner and Alexander Resch win gold medal in doubles luge; Americans Mark Grimmette and Brian Martin win silver and Clay Ives and Chris Thorpe, also of United States, win bronze; photos; chart shows interval times for medal winners (M)

Local governments in China are employing psychiatric commitment as way to handle troublemakers and pests; officially, Chinese psychiatrists adhere to same commitment standards as doctors in West, that people can be hospitalized against their will only if they present danger to others or themselves; but in China that standard is not combined with legal time limits on how long person can be held while assessment is made; doctors outside big cities are poorly equipped to conduct evaluations and may lack confidence to defy officials who regard any behavior that deviates from norm as sign of mental illness; article describes plight of one woman who has spent total of 210 days in confinement after petitioning local government to address her grievances; photos (M)

Revival of band program in Community School District 28 in Queens brings together young musicians of many ethnic backgrounds; photos (M)

William Lerach is named to lead tangle of securities fraud cases against Arthur Andersen and former executives and directors of Enron Corp; selection practically guarantees his firm, Milberg Weiss Bershad Hynes & Lerach, largest share of any legal fees, which could amount to hundreds of millions of dollars; Lerach is flamboyant class-action lawyer well known in world of shareholder litigation; photo (M)