Thank you Bryan!! and thank you Hideto for the good keywords in your 1st posting.
I fixed my problem by finding this old posting. I upgraded to 1.4 from version1.1.1.
Someone should update the documentation.
backup data directory
backup SQL data
rename moodle to moodle.backup
untar the new version of moodle in the archive file
ex: tarxvzf moodleverxxxx.tgz
copy config.php file from moodle.backup to moodle dir
set these three new folders to have permissions of 777
visit the URL http://yourserver/moodle/admin
the upgrade works and afterwards you can login! yea.