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1 terrorism's homeland Saudi government officials showed a little more candor than usual following the simultaneous terrorist attacks on three foreign compounds in the kingdom's capital city. "The fact that the terrorism happened is an indication of shortcomings, and we have to learn from our mistakes," said Saudi Foreign Minister Prince Saud al-Faisal. But the Riyadh attack that left 34 dead, including at least seven Americans, also exposed a rift between the United States and Saudi Arabia on the Saudis' level of commitment or ability to fight terrorism. The U.S. ambassador said the Saudis did not provide the "additional security we requested" after U.S. officials learned of the threat. Mr. Saud claimed the government has met every request for tighter security, but had no specific request from U.S. diplomats regarding last week's attack. John Burgess, a U.S. diplomat in Riyadh, explained that the Saudis are responsive-but only to a degree. He said, for example, they will provide extra police patrols for a day or two, but then pull them. One American expatriate who has worked in Riyadh for three years said he is "more concerned than ever" about his safety. Although the terrorists did not strike his compound, he said his residence is "not as well protected as the ones that were hit." After receiving word of the attack from a U.S. military official, he and his wife spent a nervous night wondering: "Are we next?" The American said he's noticed a change in tone from Saudi officials: They don't want to "antagonize" the United States, but there's little they can do to fight the terrorists. On May 6, the Saudi government's botched raid on a small al-Qaeda terror cell resulted in all 19 escaping. Although one later surrendered, terrorists can easily hide among an increasingly anti-American populace, experts say. U.S. and Saudi authorities suspected that nine of the attackers came from among the al-Qaeda operatives. As the United States sent a team of FBI investigators to the site, it also urged the 30,000 American citizens working in the Arab country to leave; last month the United States withdrew American troops from Saudi bases. 2 "every bit of justice" "We want to get every bit of justice for these guys," said Victoria County (Texas) District Attorney M.P. "Dexter" Eaves as the search for at least two accomplices continued last week after a trucker abandoned a group of illegal immigrants inside a semitrailer, suffocating 18 of them. Authorities have in custody the trucker, Tyrone Williams of Schenectady, N.Y. Officials from the Victoria, Texas, sheriff's department found the abandoned trailer at a South Texas truck stop in the early morning of May 14. Inside, they made a gruesome discovery: 13 people, including a young boy, were dead inside and four other bodies were on the ground. Another immigrant died later at a hospital. The trailer was found abandoned near Victoria, nearly 200 miles from the Mexican border. Smugglers apparently drove off in the cab, transforming the normally air-conditioned trailer into an airtight vault. Temperatures that day had risen above 90. 3 deflation alert? Federal Reserve policymakers had already said that they were more concerned about possible deflation (prolonged falling prices) than inflation, so last week's report on producer prices couldn't have been good news at the Fed. The Labor Department reported that wholesale prices fell 1.9 percent in April, the largest drop since the government first compiled such figures in 1947. The concern is that falling prices, unless fueled by increases in productivity, will lead to a situation similar to that of Japan. Falling prices there have cut deeply into profits, sapping economic growth and hurting the manufacturing economy. Fed Chairman Alan Greenspan and his colleagues earlier this month signaled that they were prepared to cut interest rates to ward off deflation at the Fed's June 24-25 meeting. Interest rates are already at a 41-year low. 4 nuclear summer South Korean President Roh Moon Hyung made his first state trip to the United States under a growing cloud of tension with North Korea. On May 12, North Korea pronounced dead a 1992 agreement with the South prohibiting both sides from making or deploying nuclear weapons. Nuclear confrontation topped the agenda of a summit and working dinner between Mr. Roh and President George W. Bush on May 14. Mr. Roh has stressed a conciliatory and delicate negotiating posture to North Korea, one that avoids "regime change" language and won't risk destabilizing South Korea's economy. But U.S. critics of Pyongyang say proper attention to dismal human-rights conditions is key to defusing an arms race. A letter to Mr. Bush from 30 mostly Christian leaders (organized by the Institute on Religion and Democracy) argued that silence toward Pyongyang's brutality "is neither an honorable nor a prudent option." North Korea "is systematically violating all human-rights standards because it is desperately fighting for its own survival. It is resorting to nuclear issues to stay in power," says Norbert Vollertsen, a German doctor and outspoken critic of the Kim Jung Il regime. One sign of decay: the success of a clandestine program-dubbed "Weasel"-to encourage defection of top military officers and scientists, including nuclear specialists. One of the defectors showed up at the National Press Club on May 15 as a guest of Dr. Vollertsen and the Hudson Institute. 5 inside iraq President Bush's dream team for postwar Iraq unraveled along with security in the region. Departure notices went out for Jay Garner, the retired lieutenant general who was the top U.S. civil administrator in Iraq. Also leaving is Barbara K. Bodine, a diplomat who was in charge of Baghdad reconstruction. In a drastic overhaul, the president brought in as head of reconstruction L. Paul Bremer III, a State Department counterterrorism vet. Washington pundits said Mr. Bremer's appointment is a victory for Secretary of State Colin Powell (see p. 8), but Bremer allies argue that his views on Iraq are actually close to those of Defense Secretary Donald Rumsfeld. Regardless of who is in charge, rebuilding experts say the formula for postwar Iraq has to be simple. Local involvement must be maximized, but without inviting chaos. "Take no decisions without consulting the Iraqis, but even so, don't hesitate to overrule them if need be," advises Dr. Bernard Kouchner, a self-described "specialist in the collapse of society." Dr. Kouchner is a rare Frenchman: The founder of Doctors Without Borders and former government official supported regime change in Iraq.