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Lou Dobbs Moneyline
New Anthrax Cases Confirmed; Wall Street Sees Second Day of Sell-Offs
Aired October 30, 2001 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: This is LOU DOBBS MONEYLINE for Tuesday, October 30.
LOU DOBBS, CNN ANCHOR: Good evening.
Top government officials today adding their voices to the call for Americans to remain vigilant.
(BEGIN VIDEO CLIP)
TOM RIDGE, HOMELAND SECURITY DIRECTOR: Continue to live your lives. Continue to be America, but be aware.
NORMAN MINETA, SECRETARY OF TRANSPORTATION: We must ensure that our transportation system will never be used as engines of destruction.
(END VIDEO CLIP)
DOBBS: The president planning to do just that, scheduled to throw out the first pitch in game three of the World Series tonight in New York City.
And new cases of anthrax, traces found in additional buildings in the nation's Capital today.
And a New York City hospital is forced to close temporarily.
Low-flying U.S. fighter jets pounding Taliban targets around southern Afghanistan. The Pentagon saying the war is going as planned and they're prepared for the long haul.
For the first time in more than 20 years, a Ford takes control of Ford Motor Company.
And a sell-off today on Wall Street for the second day in a row sparked by a disappointing report on consumer confidence.
Anthrax continues to show up at mail facilities around the nation's Capitol. Traces of anthrax found at two additional mail facilities in Washington D.C. as well as at an office assigned to U.S. Capitol Police. We'll be going live to Washington in just a moment.
Anthrax spores also turning up at a mail-processing facility in Palm Beach County, Florida.
And in New York City, a 61-year-old woman who works at the Eye, Ear and Throat Hospital has been confirmed to have inhalation anthrax. The woman tonight is reported to be in critical condition. Antibiotics are being offered to everyone who visited that hospital over the past two weeks. The hospital closed today and it will remain closed at least through tomorrow.
In New Jersey, federal investigators are checking whether a woman may have contracted anthrax through mail delivered to her home or, perhaps, her office.
Now, for more on the hunt to find the person or persons responsible for these anthrax attacks, we're joined by Eileen O'Connor in Washington.
Eileen, is the government any closer to cracking -- solving -- this case than it was when anthrax was first discovered a few weeks ago?
EILEEN O'CONNOR, CNN NATIONAL CORRESPONDENT: Well, they say they have gotten a lot of leads and they say they have been able to rule out some theories, Lou.
But really, they say they are still in search for the facts that are going to support the theories that they do have left. And what's really perplexing them today, Lou, is the fact that this one postal -- one worker in New Jersey, not a postal worker, an office worker who didn't seem to have much real contact with the mail.
And then this woman in New York who worked in a storeroom at that eye, ear, nose and throat hospital -- she also did not have a job that brought her in a great deal of contact with the mail.
How did she get inhalation anthrax? She's in serious condition. And they had always thought that if there was some kind of cross- contamination, the infection would be one of a skin anthrax type.
And now, they're saying, either there are some more letters out there or perhaps she got it from that Daschle letter.
DOBBS: Is there any possibility, Eileen, that these infections could be from just one letter traveling through the mail system?
O'CONNOR: Well, investigative sources say that when they got that Daschle letter, Lou, it did look -- there was a stain on it. It was stained. It looked like there had been some kind of leakage, perhaps it had gotten wet.
And also, the postmaster general revealed today that, in fact, a different kind of paper was used in that, different from the ones -- the paper that was used in the letter sent to NBC anchor Tom Brokaw and also the letter sent to the "New York Post."
It was a much more porous paper. And we do know that there was at least two grams. Now that's not a great deal of substance left in the Daschle letter, but it's still unclear how many anthrax spores there would have been and also how much substance did that letter start out with? So, yes, they say it's possible but then you have others who say they just believe that's unlikely -- there's got to be other letters out there.
DOBBS: At this point, they simply don't know.
Do they know whether or not they can safely narrow the list of suspects here?
O'CONNOR: Well, what they've been doing is, you know -- if you talk to different people in the FBI, you're going to get a different opinion as to who they think the most -- the more prime suspects are.
There's one field or one area -- one side that believes it's linked to foreign terrorist groups. And then there's another side that strongly believes it's linked to domestic terrorist groups.
And you've got the officials in the middle, the attorney general, John Ashcroft, and Tom Ridge and the president himself saying: Look, we're not ruling anything in or out. They're looking at all of them.
DOBBS: We simply don't know.
O'CONNOR: Right.
DOBBS: Eileen O'Connor, thank you very much.
Well, to bring you up to date in the war against terrorism: U.S. aircraft unleashing fierce attacks against the Taliban stronghold of Kandahar today. The pre-dawn assault lasted more than three hours, an intensive attack today. And the Taliban did return anti-aircraft fire.
U.S. officials say the president's national security team is solidly against stopping any air strikes during the holy period of Ramadan which would begin in about two weeks. Officials say any pause in military action could allow Osama bin Laden and his key operatives to leave Afghanistan.
And the defense secretary today saying the United States has a modest number of ground troops inside Afghanistan now. They are there helping coordinating the air attacks against Taliban and al Qaeda targets.
In neighboring Pakistan, President Pervez Musharraf has come under heavy criticism for his support of the U.S.-led military campaign. Today, after meeting with U.S. General Tommy Franks, President Musharraf has said he would accept the military campaign and its continuation.
For more on that meeting, we are joined now by John Vause, who is in Islamabad, Pakistan.
John, bring us up to date.
JOHN VAUSE, CNN CORRESPONDENT: Hello, Lou.
Well, that meeting -- President Musharraf raised those issues, which many people around the world are, in fact, asking: How long will this campaign continue? And also concerns about the growing list of what appears to be civilian casualties in Afghanistan.
There's seems to be a growing unease here in Pakistan, not just amongst the hard-line fundamentalists who we've seen on the streets since the strikes began, but also amongst the general population -- concern that this military campaign is continuing without any apparent success.
Now today, President Musharraf met with one political party, the Pakistan Muslim League. He plans to meet with other political parties over the coming days. That's seen by some as an attempt by the president to shore up his political support here at home. But his spokesman today said it should not be read that those meetings are in any way a sign that the government is, in fact, in any danger of collapse.
The president's spokesman did interrupt a briefing at the foreign ministry. He was there, he made that point to journalists.
Also, problems for President Musharraf with those militias on the border as well -- Lou.
DOBBS: John, thank you very much.
John Vause reporting from Islamabad, Pakistan.
Here in New York City, emergency crews are still finding victims of the September 11 terrorist attacks. The Office of Emergency Management says 4,011 people remain missing; 533 people have been, so far, confirmed dead; 481 of them have been positively identified; 52 are unidentified.
For more now on the military campaign against Taliban and al Qaeda targets in Afghanistan, I'm joined by retired General David Grange. General Grange last served as commanding general of the 1st Infantry Division, also known as the "Big Red One."
General, good to have you with us.
RETIRED GENERAL DAVID GRANGE, U.S. ARMY: Good evening, Lou.
DOBBS: You have seen, as I have I'm sure, some of the polls that are starting to suggest some waning concern, waning confidence, in the amount of time that this campaign is taking.
Is there a reason here for concern about the progress of this campaign?
GRANGE: I don't think there is concern.
I think we have to take heed to what the president, secretary of state, secretary of defense have stated, that we have to have patience. We have to have resolve. There's no doubt that we have to go for the long haul in this campaign and that's typically what has to be done when you're fighting a guerrilla war.
DOBBS: Well as a man who's led troops in action and you start to hear some of these reports about rising impatience, and we look back and it's just about three weeks of military activity.
What goes through your mind?
GRANGE: What goes through my mind is I remember the American dead on September 11. I remember what's happening right now. I think about the stock market, our economy. And you think about what -- the fear that's been put upon the American people every other week about a possible terrorist attack.
And we need to hang in there and win this war or we're going to live that way forever. And so, I just -- I feel strong about winning this fight, taking the fight to the enemy and resolving the situation. And I think we can win it.
DOBBS: And in terms of time frames, the American people -- we are, notoriously, an impatient people.
But there is also a cry from certain quarters that this campaign for its success should be accelerated with ground troops -- more ground troops placed in Afghanistan to go after the Taliban.
What's your opinion?
GRANGE: Yes, there's some good points to this concern.
There's three things that are on the horizon that affect this operation. One, obviously, is the upcoming Ramadan, which I think we should fight right through that. You know, Muslim leaders have fought during Ramadan throughout history and that should be no different here.
We need to continue the momentum and not let free movement occur with Taliban or al Qaeda forces.
The other is Pakistan -- Musharraf, I think, is on thin ice supporting this operation and we need to keep that -- be cognizant of the sensitivity of Pakistan in reference to Afghanistan. And then the other is the winter coming up, not so much for military operations, but because of the refugees. And we have to -- there's going to have to be some action taken just for the humanity reasons to take care of these people.
DOBBS: And with whom should the responsibility for those refugees rest? I'm talking now about those people in Pakistan who have crossed the border, principally in Pakistan. Should that be the responsibility of the United Nations or is it something the United States should assert help?
GRANGE: First of all, the responsibility for the situation is al Qaeda and the Taliban. They are the ones that caused this to begin. But now that we have the situation, it's the international community, which the United States has to play a part in.
DOBBS: And I think we should point out, as you brought it up, about fighting through Ramadan. The secretary of defense, Donald Rumsfeld, has said, clearly and unequivocally, that there will be no letup during Ramadan. And you obviously agree with the secretary of defense.
GRANGE: I absolutely do. And, also, the reason -- reason for that is that, one, they'll take advantage of this. We have to be very selective in our targeting, go after maneuver units, be cognizant of mosques and schools and other type things, even though they hide in those areas, but at the same time, have a very extensive information campaign to explain to whoever we can reach by radio, by television, by leaflet, all means, that, in fact, we're going after maneuver units that have oppressed the people, that we're not there to bomb a -- it's not a religious bombing during Ramadan.
DOBBS: How concerned are you, General, by reports that from principally Pakistan that some fighters have crossed the border into Afghanistan to join up with the Taliban? How much of a surprise is that to you? How important is it to the strategic considerations of the military there -- the U.S. military?
GRANGE: No surprise at all. Many of these places -- it's the same thing in the Balkans -- you have types, tribes, ethnic groups of peoples, of fighters, whatever, that cross boundaries.
And in this case, the nation state is almost -- it's so porous that it straddles this enclave of Pashtun. The Taliban fighters cross that. There's no surprise at all. And they support each other.
DOBBS: And in terms of -- we've talked about it in political terms. I think that would be the best way to put it. But, in operational terms, an acceleration of the assault in terms of keeping the Taliban on the defensive and succeeding in this mission, do you think that it makes good operational sense to accelerate here the strikes against the Taliban?
GRANGE: I would like to see some acceleration in strikes, again, on maneuver units those that the anti-Taliban forces, the Northern Alliance, are fighting against up there in the north, Mazar-e-Sharif, in the -- Kabul itself as a political objective. I think we need to put the pressure on those and hopefully get those before the winter and then isolate the Taliban and al Qaeda down in Kandahar through the winter, if need be. So what? Just let them rot there.
DOBBS: General Grange, thank you, as always, for being with us -- General David Grange.
GRANGE: Thank you.
DOBBS: Coming up next here: The nation has been put on notice, but told to carry on as usual. We'll take a look at how the White House is following its own advice. Also, airport security is causing a political rift in Washington: at issue, whether or not to federalize the nation's airport security system. We'll be going to Capitol Hill for the latest report on that.
We'll also have a report for you on how the Coast Guard is dealing with now added responsibility and limited -- severely limited resources.
MONEYLINE will continue in just one minute.
(COMMERCIAL BREAK)
DOBBS: Another issue in Washington today: airport security. Both Democrats and Republicans do agree that airport security now isn't working. The disagreement is about how to federalize or whether to federalize that system.
Kate Snow joins me now from Capitol Hill and has more on this debate -- Kate.
KATE SNOW, CNN CORRESPONDENT: Lou, the White House and House Republican leaders putting a lot of pressure on members of the House, trying to convince them that the best way to do this is to pass a bill supported by the president that would allow federal oversight of security screening, but not require them to be federal employees. It would allow private companies to do that work.
This afternoon at the White House, several House Republicans were invited who were undecided. They emerged from that meeting with the president, talking about how convinced they were now of this argument -- one member saying that what sold him on this bill sponsored by Chairman Dan Young (sic) was the fact that it would require security screeners to be U.S. citizens.
(BEGIN VIDEO CLIP)
REP. MARK KIRK (R), ILLINOIS: ... citizens. And we found out at Dulles airport, which allowed one terrorist group to board, that over 90 percent of the screeners were not Americans. Some of them were, in fact, illegal aliens. Chairman Young has agreed to put in a requirement that all future screeners be U.S. citizens.
(END VIDEO CLIP)
SNOW: But the other bill has a lot of support, too, supported not only by Democrats in the House, but also by key Senators. Recall, two weeks ago, the Senate passed a bill 100 to nothing. That's the same bill House Democrats are pushing. And it would provide that screeners be federal employees.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), ARIZONA: This is all about law enforcement. Law enforcement is a function of government. I am a proud conservative, but law enforcement, Border Patrol, INS, customs, the FBI are all government law enforcement responsibilities. The safety and security of our airports and airliners is a government responsibility. (END VIDEO CLIP)
SNOW: Senators and House Democrats say they think their system using federal employees could be up and running, fully functional within a year. On the other hand, those House Republicans, with their version supported by the president, say their version would be quicker and faster. It would be up and running within three months -- Lou, back to you.
DOBBS: Kate, thank you very much -- Kate Snow from Capitol Hill tonight.
The nation's homeland security director today urged law enforcement agencies and private companies to be on high alert for possible terrorist attacks -- Tom Ridge's comments following yesterday's strong warning from Attorney General John Ashcroft.
John King broke that story yesterday, has been following the story throughout the day and joins us now -- John.
JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: Lou, increased security around the country tonight, including restrictions in the airspace over Yankee Stadium, where President Bush is on his way to throw out the first pitch tonight in game three of the World Series -- new restrictions on airspace over nuclear power plants and other nuclear facilities across the country as well -- even more security being put in place at airports, train stations and other central transportation centers around the country -- all this in response to that new alert -- some criticism of the administration tonight, saying that it only serves to scare the American people when the administration issues such an alert, but acknowledges there is no specific information as to the targets for possible terrorists strikes or for the method of those strikes may take place.
But, as you noted, the Homeland Security Director Tom Ridge out discussing this issue today, he says it is a very tough call -- the government having to decide between informing the American people and perhaps alarming the American people -- but, in this case, Governor Ridge saying he is convinced the administration made the right call.
(BEGIN VIDEO CLIP)
TOM RIDGE, DIRECTOR OF HOMELAND SECURITY: I think you can fairly assume that the experts view this tied in, this information somehow related to al Qaeda or bin Laden, else we wouldn't have ramped it up.
(END VIDEO CLIP)
KING: And as the president heads to New York to throw out the ceremonial first pitch, he is out in public sticking to his routine -- but one added security precaution here at the White House, once again the president and the vice president being kept apart -- Dick Cheney not at the White House today, at a secure location, monitoring events, in touch with the president -- but what they call continuation of government protocols in place just in case the White House is a target -- Lou. DOBBS: John, as you have reported for the administration, for the White House, this is a very difficult call to make, whether or not to issue the alert, the terrorist alert with all of the attended problems with it. But has the president and his national security team, his homeland security team, have they sought out counsel and, if you will, agreement with congressional leaders on this issue?
KING: They have sought out and they consulted congressional leaders yesterday. We have received a smattering of criticism from some members of Congress today on that point I mentioned. They say this only serves to alarm the American people. But they did quickly consult members of Congress yesterday. They have been more liberal in sharing classified information of late.
You'll remember a few weeks back the president had a spat because of some leaks.
The president believes he has overwhelming support in the Congress. Some criticism. He also believes that if you're going to put law enforcement agencies on alert, at some point that information would leak. But the best course of action, as controversial as it might be, is to acknowledge this directly and tell the American people.
DOBBS: And it wouldn't be Washington, D.C. without a little criticism. John, thanks. John King from the White House.
Well, despite this latest national security alert, President Bush tonight is leading by example. He's going ahead with one of his somewhat lighter presidential tasks of late. In just about two hours, as John King just reported, the president will be tossing out the first ball in tonight's World Series game at Yankee Stadium in New York City.
For a check now on the security levels there, we're going to have a live update from Gary Tuchman, who's standing by at Yankee Stadium -- Gary.
GARY TUCHMAN, CNN CORRESPONDENT: Hello to you, Lou. We often think of baseball as innocent summertime fare. Well, it certainly is not summertime anymore, and it's no longer innocent.
The gates opened here for World Series game No. 3 about an hour and 15 minutes ago. For the first time ever, all fans and members of the news media are required to go through metal detectors. You don't go through the detector, you don't get in.
In addition, people are being patted down. Electronic wands are being used on them. And if you bring a bag in and you want to keep your bag, you're not going to be allowed to go into the stadium.
There are at least 1,000 police officers in uniform and out of uniform. The number is probably more. Wherever you look, you see people with ear pieces. The reason for that, of course, the president of the United States, George W. Bush, coming here to throw out the first pitch. John King was just talking about the air corridor around here being shut down for the game. We can tell you right now we've seen a couple of planes flying over the stadium. But we are told, when it gets closer to game time, we will no longer see those airplanes.
Now, many of the fans who are here admit they are nervous. However, they say they got here. They saw all the police, they saw other fans. They felt reassured, they felt better.
We'll see if they still feel better after this game ends. If the Yankees lose, they're down three to nothing, and then they won't be too happy.
Lou, back to you.
DOBBS: Not too happy, but I think most New York fans will say they've still got some more chances to win.
Gary, thanks a lot. Gary Tuchman from Yankee Stadium.
A little later tonight, we'll take a look at how the Coast Guard is responding to new security demands along our shorelines. There are more patrols. But just how is that affecting other work that the Coast Guard does and at what cost? We'll tell you.
Also coming up here, a hotel industry decimated by the terrorist attacks, but we'll take a look at one part of that industry showing surprising strength.
But first, let's turn to Wall Street, where we don't have much good news for you. Stocks again falling sharply. Blue-chips tumbling, following a weaker-than-expected report on consumer confidence.
The Dow down 147 points on the day and volume more than 1.2 billion shares.
Christine Romans at the New York Exchange to tell us about all of last week's gains being erased in just two days -- Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: Well, Lou, it looked like textbook profit-taking and weak economic news piling on top of that to really take stocks lower: 28 of the 30 Dow stocks closing on the downside.
Take a look at some of them. Eastman Kodak down sharply here today, hammered by this economic slowdown, and Moody's cutting some of Kodak's debt rating. Coca-Cola lower. Philip Morris yanked off Goldman's recommended list. And Goldman's cutting its price target on the stock.
And McDonald's, a slew of firms cutting their profit estimates on McDonald's a day after disappointing earnings forecasts there.
Lou, we had good volume here today, better than yesterday, but not what you'd like to see if you really want to get worried about this sell-off.
DOBBS: Good volume, bad result.
ROMANS: Yeah.
DOBBS: All right, Christine. Thank you, Christine Romans.
Just ahead tonight, we'll be talking about a national ID card system: how a small addition to your pocket could be the most effective weapon in the fight against terrorism domestically.
The Coast Guard has stepped up patrols to protect our shores, but now it's being forced to take a new look at how it uses those resources.
And Jacques Nasser is out as Ford CEO. Can the new leadership turn the carmaker around? We'll have a report for you next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: There is now a rising interest in a national identity card. The government has long been and continues to be opposed to that idea. But a growing number of Americans do favor it. National ID cards are in use in many countries around the world, and as Steve Young now reports, they could be an effective first guard against terrorism.
(BEGIN VIDEOTAPE)
STEVE YOUNG, CNN CORRESPONDENT (voice-over): Something there is in the American psyche that does not love ID mandatory identification cards. But since the September attacks, opinion seems to be swaying. Close to 70 percent of the American public now supports a system of national ID cards. Americans think it might help prevent future terrorist acts, although the White House is one important exception.
The issue has turned some ideologues on their ear. Card-carrying liberal attorney Alan Dershowitz now supports national ID.
ALAN DERSHOWITZ, HARVARD LAW PROFESSOR: ... a limited national ID card, which would have the name, the address, the Social Security number, the photograph, and a print, fingerprint or retinal print matchable to a computer chip, would simply make identity theft impossible. It would eliminate the need for any kind of racial or ethnic profiling.
YOUNG: But the idea of a national ID card gives one libertarian think-tank, the Cato Institute, hives.
TIM LYNCH, CATO INSTITUTE: The national ID card system is really the ultimate dragnet device. It would require over 250 million Americans to surrender some of their privacy, some of heir freedom for a system that I do not think will stop the terrorist from committing acts of violence here in the United States. YOUNG: Would not work, Lynn says, because terrorists could bribe card issuers, card checkers or they could recruit young people with spotless pasts.
That hasn't stopped a host of European countries, including Germany, France and Spain, from adopting ID systems.
The heart would be a monster database, and Oracle's CEO says he'd give the software to the government free.
LARRY ELLISON, PRESIDENT & CEO, ORACLE: We have to give them the tools -- databases, cards -- and the latitude to protect us. And if we do, our liberties and our lives will be saved together.
(END VIDEOTAPE)
YOUNG: Advocates say it would be important to guard against too much information being required or shared. Critics predict first ID cards would be required at airports, then more and more places in what they call "function creep" -- Lou.
DOBBS: What has been the experience, Steve, in Europe with these national ID cards? Are they effective?
YOUNG: Well, France, for example, has an ID card and has had plenty of terrorist incidents. It's been a kind a mixed bag.
DOBBS: A mixed bag.
YOUNG: A mixed bag.
DOBBS: OK. I think we'll put that down under "for further consideration."
YOUNG: OK.
DOBBS: All right, Steve, thanks. Steve Young.
For more on the -- for more than 200 years, I should say, the Coast Guard has been the first line of defense along our nation's shores. But with the country on heightened alert now, increased patrols are putting a tremendous strain on limited resources. The Coast Guard is having a difficult time performing critical day-to-day duties that keep the country, the economy moving and secure.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): They are everywhere along the 95,000 miles of U.S. coastline, on highest alert. They are working 84-hour watch shifts instead of 40. At 35,000 people the Coast Guard is the same size it was in 1967, smaller than the New York City Police Force; 3,000 reservists have been called up.
SEN. DICK DURBIN (D), ILLINOIS: I can tell you that they are really being pushed to the limit. They are working longer shifts. They are relying for more help from the auxiliary, and it is clearly a situation that we have to pay attention to.
PILGRIM: The Coast Guard's annual budget is $4.6 billion, the cost of two nuclear subs. The service is asking for $200 million more. The Coast Guard used to do primarily weather patrol, but over the years, the duties extended to drug enforcement and patrols for illegal aliens.
Now it must escort cruise ships in and out of port, monitor and investigate 68,000 port calls by foreign vessels, sometimes boarding them for inspection, spending an additional $1.5 million a day.
Fifty-five hundred ships have been boarded since September 11. Ships must register 96 hours in advance of putting into port, all cargo and crew, so the Coast Guard can run background and security checks, painstaking labor-intensive work.
COMMANDER JIM MCPHERSON, U.S. COAST GUARD: We have never done anything like that. Usually 24 hours was the required notice. And we didn't check all the vessels. The 96-hour notice gives us the opportunity to really look at all the vessels coming in and decide which ones we need to target.
(END VIDEOTAPE)
PILGRIM: One of the hardest things to gauge is how long this state of alert has to be in effect. This level of security demands manpower and money, and for now, the time frame appears to be indefinite -- Lou.
DOBBS: And what does it look like in way of prospects for relief for the Coast Guard? More money, more help.
PILGRIM: They have asked for $200 million. Their budget is 4.6 billion; 200 million in the scheme of things doesn't seem like that much.
DOBBS: It isn't. That is a surprisingly small request.
PILGRIM: Small number. They run on fairly scant resources. Most of their ships are three decades old.
DOBBS: Sounds like more money may be under consideration.
PILGRIM: Let's hope so.
DOBBS: All right, Kitty. Thanks. Kitty Pilgrim.
Taking a look at the latest developments in the war against terrorism now. More traces of anthrax have been found in several cities as well as more infections. A 61-year-old New York City woman is in critical condition tonight with inhalation anthrax. Antibiotics are being offered to thousands of people who visited the Manhattan Eye-Ear-Throat hospital where she works. Traces of anthrax have been found at two additional mail facilities in Washington D.C. and an office used by U.S. capital police, and a mail processing facility in Palm Beach County, Florida. Investigators tonight are trying to figure out how a New Jersey woman contracted skin anthrax. The woman is not a postal worker but she does live near a mail center in Hamilton township where anthrax has been found.
Overseas, U.S. warplanes continue to bomb the Taliban stronghold of Kandahar. The Taliban returned fire today.
And U.S. officials now say President Bush's national security team is solidly against stopping the bombing during the holy period of Ramadan. The terrorist attacks and anthrax attacks are having a much greater impact on the economy than had been first thought. Consumer confidence this month plunged to the lowest level in more than 7 years.
Wide spread lay-offs and rising unemployment also contributing to growing pessimism.
Kathleen Hays is here not and has the story for us -- Kathleen.
KATHLEEN HAYS, CNN CORRESPONDENT: People were a little bit surprised, Lou, because the University of Michigan's Consumer Sentiment Survey last week was rather steady. But this is the conference board's survey, 5,000 households that they survey every month for decades. Their index plunged to 85.5 in October from 97 in September, the lowest level in several years and is in fact, 4 monthly declines in a row, and as you can sees that is the kind of slide that makes people worry about recession.
What is fueling it? Job layoffs for one. Rising unemployment. Big corporations around the world have laid off or announced layoffs for more than 690,000 people in the past several months. The economy is stagnating and may be heading downhill. And on top of that, a war on terrorism that is injecting an element that Americans have really never had to deal with. (BEGIN VIDEO CLIP)
DELOS SMITH, CONFERENCE BOARD: It is outside really of economics. It is, of course, the terrorist attack on September 11, and it's also the continuous anthrax scare. You are introducing bioterrorism to the formula and that's a very scary business. From my point of view we've really ripped the social fabric.
(END VIDEO CLIP)
HAYS: And if fact, Delos Smith says he thinks that one thing that will help mend confidence is for Americans to see some victories in this war on terrorism, some arrests. Maybe figure out where the anthrax is coming and what we can do about it.
It is interesting, this is an October number. We know now the economy in the fourth quarter of the year was sliding at least in this confidence measure. Tomorrow we get a third quarter number which is going to say we were already in pretty bad shape.
Third quarter GPD, Gross Domestic Product, is forecast to fall about a percentage point. Look, fourth quarter of '99 the economy was growing at an 8 percent annual rate going into Y2K. Look where we are now. A steady downtrend. This is why many people say we have fallen into recession and that number tomorrow, if it is negative, is certainly going to increase that talk.
DOBBS: Part of the reason we call them cycles.
HAYS: Yes, and we've lived through them, and probably will live through this one too.
DOBBS: Let's certainly hope so.
Kathleen, on that up note, thank you very much.
That weak consumer confidence report pushing investors to send the indexes lower for a second straight day. More than $200 billion dollars in markets capitalization today were erased. The Dow, Nasdaq and S&P 500 all falling more than 1.5 percent on the session. We turn to Christine Romans at the New York exchange, Greg Clarkin at the Nasdaq market site and let's begin with you, Christine.
ROMANS: Lou, here's more good news. The Dow had been down about 200 points and it closed down well off its lows and above 9,100. So that is good news. Let's take a look at some of the big board losers here, some of the stocks that are on the down side.
Bristol-Myers Squibb announcing some job cuts. CVS and all the pharmacy stocks moving lower after CVS warned.
Enron down again. Lowest price since 1993. This one continues to get hammered and Selectron down again here today. A bunch of brokerage downgrades. But there were some bright spots. An IPO, an initial public offering, Anthem Health doing quite nicely here today.
Campbell's Soup up after the company guided higher. It said that people are buying soup after September 11. Newmont Mining and all the gold and silver stocks doing quite nicely as there was flight to quality, some worries about Argentina and a weak dollar today. And Procter & Gamble up almost $3 on the session. It is a Dow component so it mitigated some of those losses that we saw in the Dow 30. It actually beat the Street's expectations and maintained its guidance for 2002. That is good news on Wall Street -- Lou.
DOBBS: And thank you for the good news, Christine.
The Nasdaq down nearly 2 percent on the day. Greg Clarkin at the Nasdaq marketsite -- Greg.
GREG CLARKIN, CNN CORRESPONDENT: I will tell you, the Nasdaq down about 100 points over the last three sessions, close to a 6 percent drop over that time span. Take a look at how some of the big name technology shares did today. We had a lot of brokerage houses weighing in on these companies. Dell Computer lost ground after Merrill Lynch cut their revenue and earnings estimates. Sun lost ground, Intel lost ground and Cisco Systems, one of the few gainers. It was up about 1 percent on the day, 16.57.
Now some other stocks in the news include Juniper; Merrill Lynch downgrading after that stock ran up 110 percent over the last four and a half weeks. They figured that valuation was a little too rich. That stock gives back better than a buck on the day.
And eBay, after a big loss yesterday, rebounds today, up .89. Macrovision, though down about 30 percent on the day. This is a software company that sees no growth in the fourth quarter. That stock being hit hard.
And watch Adobe Systems tomorrow. After the bell today, the company issuing a profit warning. That could be a real actively traded issue. Lou, back to you.
DOBBS: Thank you, Greg Clarkin.
A shakeup at the world's second number two carmaker. After nearly three years as the president and CEO of Ford, Jacques Nasser is stepping down. Chairman William Clay Ford Junior to replace him.
Fred Katayama traveled to Dearborn, Michigan, for the latest on this story.
(BEGIN VIDEOTAPE)
FRED KATAYAMA, CNN CORRESPONDENT (voice-over): Ford employees greeted their new leader with a standing ovation.
WILLIAM CLAY FORD JR., CEO, FORD MOTOR COMPANY: In addition to my duties as chairman, I will become CEO.
KATAYAMA: The nation's second largest automaker ousted the autocratic Jacques Nasser, replacing him with William Clay Ford, Jr., the great grandson of the company founder, Henry Ford. The 44-year- old Ford is rich in pedigree but short on managerial experience, but he says he's up to the job.
FORD: I have a track record. The people who run this company know me. And the board felt that I was the person at this point to help heal the company and get us back on track.
KATAYAMA: As chairman, he let Nasser publicly handle the messy job of steering the company through the Firestone tire scandal, which mostly involved Ford explorers. Under Nasser, Ford lost money for the last two quarters as well as market share. Employee morale plunged after the company tried to implement a system of ranking managers.
And Ford, once tops in quality among the Detroit automakers, fell to the bottom in the latest survey. The company's stock has dropped nearly in half during Nasser's two and a half year reign. Analysts say because Ford is a tenderfoot, he will rely heavily on his two lieutenants, the new COO Nick Scheele, and the new vice chairman, Carl Reichardt, to restructure the company. ROD LACHE, DEUTSCHE BANK ALEX BROWN: The important thing, from our perspective, is that he has assembled a very good management team around him to execute on that strategy.
NICK LOBACARRO, LEHMAN BROTHERS: I have a lot of confidence in Nick Scheele. I think it's incumbent on him to surround himself with top people and set a mission that is achievable. There's a lot of talent inside Ford. KATAYAMA: Scheele says he'll come up with a restructuring plan around year's end.
(END VIDEOTAPE)
KATAYAMA: Bill Ford says everything is up for review. He says he will shift the companies focus back to basics: Building and designing good cars and trucks. Analysts suspect he will also focus on high dividends, something which Nasser chopped in half. The Ford family after all, owns 40 percent of the company -- Lou.
DOBBS: Do you think they had a voice in this decision?
KATAYAMA: Yes. Well they say that the family -- (LAUGHTER) -- with that voting stake certainly will have been persuaded by Bill Ford himself since he is chairman of the board and represents the Ford family members. But at the news conference Ford said he talked it over with yesterday then talked to the board later that day. The board voted on it this morning.
DOBBS: I find it strange that we have a situation where the CFO of Ford will now report to a vice chairman, not to the CEO. There seems to be some enthusiasm on the part of the analysts with whom you spoke about this new vision for Ford which seems to be as it has been articulated at least today, by the new CEO, to turn out cars and trucks. What were they doing before?
KATAYAMA: Right, Lou. As for the CFO reporting, it does sound sort of strange. I asked the question at the news conference and Bill Ford said the reason the CFO will report to the vice chairman instead of him, is because the vice chairman was a former head of Wells Fargo and has a lot of experience in finance and he would like the rely on him.
DOBBS: We will take that as the answer. Thanks very much. Fred Katayama.
Coming up on MONEYLINE: After intense criticism the American Red Cross the closing its special Liberty Fund. We will tell you why next.
And while much of the tourism industry is struggling, one segment of the industry is strong. We'll have that story as well, and some passionate e-mails about the postal service and anthrax. We will take a look at your thoughts later. MONEYLINE continues. Stay with us.
(COMMERCIAL BREAK) DOBBS: Today the American Red Cross named Harold Decker as interim CEO, four days after Bernadine Healy was forced out as the head of the Red Cross. The Red Cross also announcing it will end fund-raising for its Liberty Fund. That fund set up specifically to help victims and families of the terrorist attacks of September 11. That fund has received more than half a billion dollars in pledges. The Red Cross says it now has enough money to meet the needs of those involved in the tragedy. Any donations made after tomorrow will now be placed in its general disaster relief fund.
And a sell-off on Wall Street, as we have reported to you, a second day in a row. Today's decline sparked by a poor consumer confidence report. But First Albany's Hugh Johnson says investors should have expected this weak report and he predicts the next look at consumer confidence could be even worse.
Hugh, with that, let me say welcome.
HUGH JOHNSON, FIRST ALBANY: Thank you.
DOBBS: And these consumer confidence reports; no one expected it to be quite this severe. What does it portend for us?
JOHNSON: It tells you a lot about what is going to happen to consumer spending. They are very forward-looking. Particularly consumer spending not only in the fourth quarter, but maybe a little bit beyond the fourth quarter, and the answer is that the numbers are telling you that consumer spending is probably going to be a negative number in fourth quarter, that consumer spending is going to slow in the fourth quarter, maybe as we move into the first quarter.
That is obviously not a very positive thing to say about the economy as we look forward.
DOBBS: We have a number of reports. We're going to get our first look at GDP for the third quarter tomorrow. We are going to have unemployment tomorrow. These numbers are not expected to be particularly attractive or reassuring. We also have the fed coming up next week. What is your take on the impact of those numbers, on the investor and the investor's confidence and whether the fed will further cut rates?
JOHNSON: I think those numbers are going to be weak. As you suggested the employment numbers particularly. You are likely to see a drop in nonfarm payroll employment of 2 or 300,000 jobs. That is a big job loss. The Fed has got to respond to that. So I am inclined to believe that they are going to reduce short-term interest rates at their November 6 meeting by a quarter of 1 percent.
That is going to add a little stimulus to the pipeline that already is packed full of stimulus as you know. The Fed has really hit the throttle very, very hard. So hopefully, in time, and time, I hope, means first quarter, second quarter of next year, we will see the economy start to recover and earnings start to recover. That is my hope, anyway.
DOBBS: Your best counsel for investors tonight?
JOHNSON: You still have to play it a little bit on the guarded side. We don't have confirmation from the stock market yet that that recovery in the economy and earnings is coming. So play it a little bit on the safer side. Hopefully sometime we will be able to see brighter skies ahead and we will be able to say you can increase you allocation to the equity markets and start to move to the bull market sectors like technology and consumer cyclicals. But right now, play it a little bit on the safe side. DOBBS: Hugh Johnson, thanks for being here.
Coming up next, we will tell you about a bright spot within the suffering travel agency. One segment holding on despite a major tourism slowdown.
And we'll have some of your thoughts next: Reaction, in particular to post office's handling of anthrax attacks. MONEYLINE will be right back.
(COMMERCIAL BREAK)
DOBBS: One segment of the travel industry has managed to remain strong in a slowdown.
Casey Wian now takes a look at the boost in business for motels.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT (voice-over): They may not have room service or health clubs, but these days motels do have plenty of business. This Southern California Red Roof Inn had an average occupancy rate of 85 percent for the week ending October 20th. A year earlier, it was only two-thirds full.
UNIDENTIFIED MALE: Good morning. Thank you for calling Town (UNINTELLIGIBLE)...
WIAN: Campbell Motel Properties owns 27 motels in the West and Southwest. Despite an overall slump in the travel industry, its occupancy and room rates are almost unchanged from last year. Campbell's properties are in the economy, or limited service, category, catering largely to motorists.
JACK CAMPBELL, CEO, CAMPBELL MOTEL PROPERTIES: Our part of the industry, I think, is in the right price range, and I think that has had a great effect upon it. And I assume that because people now, instead of flying to their location and destination, are traveling in their car, and therefore they're using facilities like ours to spend the evening.
WIAN: Nationwide, revenue per available room remains down sharply throughout the lodging industry, but luxury hotels have been hit hardest, down nearly 30 percent in mid-October, while limited service and economy motels are off only about 10 percent.
J. COGAN, BANK OF AMERICA SECURITIES: We have corporate managers at companies telling their employees, "If you're too afraid to travel on business, you don't have to." We also have a lot of companies rethinking what their profit outlooks are going to be for 2002, and I expect companies to continue to pare back their travel spending for '02, as well, as a result of that.
WIAN: Which could make low-price, no-frills rooms more attractive to corporate travel managers.
(on camera): An added boost for the motel industry: Gas prices have declined for six consecutive weeks and are now about 60 cents a gallon below where they were in May. That's providing more incentive for people to travel by car.
Casey Wian, CNN Financial News, Anaheim, California.
(END VIDEOTAPE)
DOBBS: "WOLF BLITZER REPORTS" begins in just a few minutes. Let's go to Wolf now for a preview of what's coming up -- Wolf.
WOLF BLITZER, HOST, CNN'S "WOLF BLITZER REPORTS": Thanks, Lou. We'll be here in the CNN war room with all the latest developments in the U.S.-led military strikes against targets inside Afghanistan. How's the war going? We'll have a panel of experts who've advised presidents themselves: James Steinberg, Robert Kagan and Robert McFarlane. We'll also go live to the Pentagon and Islamabad.
That and much more next -- Lou.
DOBBS: We'll be looking for it as always. Wolf, thank you.
In less than an hour, the NBA season officially begins, and with it the return of basketball legend Michael Jordan. Jordan hits the court with his Washington Wizards playing the New York Knicks here in New York City. One person paid more than $100,000 -- and you're looking at a live shot there of the Garden -- paying $100,000 for a seat next to long-time Knicks fan Spike Lee at Madison Square Garden. The winner of the online auction then donated that ticket to a child of one of firefighters who was lost in the World Trade Center attacks.
Coming up next here, we'll take a look at your thoughts and a look at what to expect tomorrow.
(COMMERCIAL BREAK)
DOBBS: Well, taking a look at tomorrow we'll have our first look at third-quarter GDP. Economists expecting the advance report on GDP growth to show a decline of 1 percent. And we'll also have quarterly earnings reports from Tommy Hilfiger, Sara Lee and Qwest Communications, amongst others.
And tomorrow night here on MONEYLINE, our special guest will be Jack Welch, the former CEO of General Electric. I love to say that as if no one knows that he's the former CEO of General Electric. So we're looking forward to that. Time now for a look at some of your thoughts. We had a lot of comments on our interview last night with Deputy Postmaster General John Nolan and a frank exchange that he and I had over the what the Postal Service is doing to protect its employees.
I asked if the Postal Service shouldn't shut down some of those facilities until they can all be screened.
(BEGIN VIDEO CLIP)
JOHN NOLAN, DEPUTY POSTMASTER GENERAL: I've used the line that if you had a traffic accident in Seattle, you wouldn't shut down the highway system in Florida.
DOBBS: Well, this is hardly a traffic accident, Mr. Postmaster General.
NOLAN: No, but...
DOBBS: I mean, I think that analogy -- they always limp. That one is certainly in the category of limping.
I can't see any parallel to a traffic accident in these anthrax attacks. Can you?
NOLAN: Well, no, but what I'm saying is you attack the areas where you know you have a problem.
(END VIDEO CLIP)
DOBBS: Well, Donna Nafe of Waco, Texas wrote in to say that we were right to challenge Mr. Nolan on those thoughts. She wrote: "I appreciated Mr. Dobbs calling Mr. Nolan's hand on his comparison of a car wreck and closing a highway to the testing positive of anthrax. It's a frightening and dark disease."
Evelyn Allan writes to say: "I've worked for the Post Office for 20 years. Now you know what we have to go through every day."
And Jerilyn Mays writes to say: "Finally, an interviewer who asks the right questions, has a calm delivery, and challenges his guest to an intelligent exchange of information and ideas."
Jerilyn Mays, I really like you by the way.
Not everyone, however, agreed with you. Mike Stewart wrote in to say: "You seem to think that the anthrax scare is more serious than traffic accidents. It is actually much less serious. We know that in terms of total deaths."
But Joe Nassour writes in to add: "The idea that you can shut down the entire postal system is both impractical and the kind of hysteria the terrorists are trying to accomplish."
Even when we don't agree with you, we appreciate your thoughts. E-mail us at moneyline@cnn.com. For tonight, that is MONEYLINE. Thanks for being with us. I'm Lou Dobbs. Good night from New York.
For our international viewers, "WORLD NEWS" is next. Here in the United States, it's "WOLF BLITZER REPORTS," beginning right now.
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