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Lou Dobbs Moneyline
After Taking Kabul the Northern Alliance Advances Toward Kandahar; NTSB Investigators Analyzing Flight Recorders from Flight 587
Aired November 13, 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, November 13. Here now, Lou Dobbs.
LOU DOBBS, HOST: Good evening, everyone.
Tonight, the Northern Alliance is advancing, marching on Kandahar. That's one of the last major cities in Afghanistan controlled by the Taliban. This, after the Northern Alliance forces drove the Taliban from Kabul.
General David Grange will join us tonight. The United States and Russia have agreed to cut nuclear weapons. Tonight, we'll have a report for you on the new state of relations between two former Cold War rivals.
And in New York City, more questions about the crash of American Airlines Flight 587. Investigators analyzing flight recorders tonight. We'll have some expert analysis for you. We'll also take a look at the future of American Airlines. Can that carrier survive yesterday's crash, the September 11 attacks and recession?
The success in Afghanistan lifting investor sentiment on Wall Street today, an outright rally, all through major markets ending the day substantially higher. Tonight, former presidential candidate and the president and chief executive officer of "Forbes" magazine, Steve Forbes, will join us to discuss the economy, the progress of this war and America's emerging new relationship with Russia.
The latest developments in Afghanistan. Tonight, the Taliban is out of Kabul. The Northern Alliance has now taken control of the capital city of Afghanistan. There are, as well, U.S. troops there to assist. The opposition has also captured an airport near the Taliban stronghold of Kandahar. It is the last remaining principle stronghold of the Taliban.
And despite the successes of the Northern Alliances, Defense Secretary Donald Rumsfeld is cautioning that the war against terrorism is far from ended. There are also concerns that the Taliban is preparing to launch a guerrilla war. Even as the Northern Alliance forces were cheered in Kabul as they entered the city, world leaders were scrambling to set up a post-Taliban government. The President insists that any new government represent all the Afghan people. (BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We support the U.N.'s efforts to fashion a post-Taliban government that is broadly based and multi-ethnic. The new government must export neither terror, nor drugs. And it must respect fundamental human rights.
(END VIDEO CLIP)
DOBBS: As the Taliban are retreating, there are reports that they may have taken with them eight Western humanitarian aid workers as they fled Kabul. Those workers, those workers include two Americans, have been held by the Taliban for more than three months for allegedly preaching Christianity to Muslims.
Russian President Vladimir Putin assured the United States of his support in the war against terrorism. He also warned the Taliban remains a threat. President Putin met with President Bush at the White House earlier today. Both men promised to reduce their nuclear arsenals.
Kelly Wallace has the report for us from the White House. Kelly?
KELLY WALLACE, CNN CORRESPONDENT: Well, Lou, both men discussing a situation on the ground in Afghanistan capital city of Kabul. President Putin saying he believes the Taliban may be retreating as part of a strategic move to preserve weapons and equipment. As you know, Lou, President Bush did not want the Northern Alliance rebels to enter the capital city. So on this day, he was sending a message, again, of the need to have a power sharing government in place, in that city. Mr. Bush saying he is listening carefully to what is coming from the Northern Alliance commanders. And he indicated he's encouraged by what he is hearing.
(BEGIN VIDEO CLIP)
VLADIMIR PUTIN, PRESIDENT, RUSSIA: First of all, it has to do with a prospect of reaching a reliable and verifiable agreement, on further reductions of the U.S. and Russian weapons. Here, I must say, we appreciate, very much, a decision by the President, to reduce the strategic offensive weapons, the limits indicated by him. And we, for our part, will try to respond in kind.
(END VIDEO CLIP)
WALLACE: Well, that was not the sound byte you were to hear. You were to hear President Bush talking about how he believes the Northern Alliance commanders have no intention of occupying the capital city of Kabul. Mr. Bush also urging the rebels to exercise restraint.
Now as you were hearing, Russian President Vladimir Putin, talking about the other big news of the day. President Bush announcing that the United States would dramatically slash its nuclear arsenal. Currently about 7,000 U.S. warheads. Mr. Bush pledging to reduce that number to between 1700 and 2200 over the next decade.
As you heard, Mr. Putin saying that Moscow would decide to try to respond, in kind. But Lou, no real breakthrough on this other issue. And that is U.S. plans to pursue a missile defense system, a 1972 Anti-ballistic Missile Treaty prevents a country from pursuing such a system.
As you know, Mr. Bush says that that treaty is outdated, outmoded, it should be scrapped. But the Russian president continues to believe the treaty is important, although he indicates a willingness to discuss this and to try to resolve it in some way. You can say the two men definitely to discuss this when they are at the President's ranch in Crawford, Texas. Lou, Mr. Bush arrived there a short time ago. The Russian President will be there tomorrow.
Lou, back to you.
DOBBS: And even though they did not resolve the missile defense issue, this was extraordinary progress, this announcement of reduction in nuclear weapons and the relationship that's grown between two countries, particularly, vis-a-vis Afghanistan.
WALLACE: Absolutely, an extraordinary story, dramatic reductions by the United States. Moscow to follow suit. The two men, Mr. Bush saying that they're sort of in the midst of a transformation or relationship that used to be based on hostility is now based on cooperation and trust. The September 11 attacks definitely solidifying that relationship even more.
And Lou, really just a sign of the extraordinary developments going on in Afghanistan. This news about the nuclear arsenal reductions would be sort of front page news, but obviously the military campaign in Afghanistan is certainly getting center stage.
Lou?
DOBBS: Well, we can't give it the front page, but we can sure give it the top of the broadcast.
WALLACE: Right.
DOBBS: Kelly, thanks. Kelly Wallace from the White House.
As we reported to you, the Northern Alliance has now moved into Kabul, the capital of Afghanistan. The Northern Alliance has taken roughly half the country since just last Friday. And reports saying there is mounting opposition to the Taliban in the population that was previously supportive.
CNN's Matthew Chance has the latest for us from Kabul.
(BEGIN VIDEOTAPE)
MATTHEW CHANCE, CNN CORRESPONDENT (voice-over): A dramatic turn of events here in the Afghan capital, Kabul. The city behind me was, of course, the stronghold of the Taliban. Now those forces have completely abandoned it, leaving it open for the forces of the opposition Northern Alliance to move in, to take over.
They said they've been doing throughout the course of today, but we've been watching Northern Alliance troops in trucks and forward drive vehicles, move to the streets of the capital. Crowds have been forming, cheering them on, chanting anti-Taliban slogans.
Those forces, of course, have earlier committed not to enter the city. But instead, they said they would wait at the gates of the capital. Clearly that is not what has happened. They have moved in force in the city. Abdullah Abdullah, he's the foreign minister of the Northern Alliance.
(BEGIN VIDEO CLIP)
ABDULLAH ABDULLAH, FOREIGN MINISTER, NORTHERN ALLIANCE: The next mission for us is to try to establish a mechanism, the representation of the people, to give the people of Afghanistan the right of self- determination.
The U.N. can help us. We are in contact with the United Nations. And we have asked the U.N. to send its teams to Kabul for the continuation of the consultations with us, with other Afghan groupings in Kabul itself.
(END VIDEO CLIP)
CHANCE: Well, Dr. Abdullah Abdullah renewed the commitments of the Northern Alliance to find a formula, that would enable all the diverse ethnic groups to share power in a future government of Afghanistan. He also said the reason that troops came in the first place is that is they saw the Taliban leave so unexpectedly. So -- and really confirming that they saw that opportunity to seize the ultimate military prize they've been after for years.
DOBBS: Matthew Chance from Kabul. And tonight, the Northern Alliance, advancing on Kandahar, the last remaining principle stronghold of the Taliban.
Well, the chairman of the joint chiefs of staff, General Richard Myers, saying that the Northern Alliance now controls just about half of Afghanistan. Here to assess the Northern Alliance's dramatic gains and Afghanistan's future, General David Grange. CNN military analyst.
Good to have you with us.
DAVID GRANGE, RETIRED GENERAL, U.S. ARMY: Good evening, Lou.
DOBBS: This is just a remarkable advance, from last Friday to take, at least to this point, half the territory that was the -- in dispute between the Taliban and the Northern Alliance. How could it happen so quickly?
GRANGE: Well, I think it all started with the combined arms attack on Mazar-e-Sharif. It was the first major attack by the Northern Alliance. And it was a combination of ground and air, which is the first time they really put that together in a combined arms effort, which gave you the synergy of force to take down Mazar-e- Sharif.
And then, the rest of -- they used those same techniques, by the way, I think, trained or persuaded by our special forces in the United states, and special forces of Great Britain and maybe some other allies, to hit the other countries and take them down.
And then, they went ahead and continued the momentum, went south towards Kabul, linked up with the forces outside of Kabul. And then, I think they were going to honor our President. And President Musharraf's desire is to stay outside the gates.
But when the Taliban retreated, they went ahead and occupied the city because there was no military in the city at all. And it may well have been concerned about problems in the city, if they had a military force there. So it wasn't much of a fight there. It could have been.
DOBBS: It's after all, a fight for the control of a nation, to not take the capital when it was made available by the withdrawal of the Taliban would have been, at the very least, counter intuitive?
GRANGE: Yes, it's hard to understand. And -- but this is the traditional capital, not -- Kandahar is actually the real, as you know, the head of government if you can call it a head of government. I think it moves around in a mobile sense with a couple handheld radios. But Kandahar is really center of the leadership for the Taliban.
But still, Kabul, splitting Taliban forces north and south, the significance of that city falling into the hands of the Northern Alliance, throughout the countries in the region had great impact. And I would think that the Taliban, if they really wanted that city, they had more troops, more equipment, could have dug in, inside the city, negated our air power, because of collateral damage, the use of the air power and put up a heck of a fight infantry to infantry. It didn't happen.
So I think -- I suspect a lot of deals were cut. You've got people changing sides. You've got people cheering and clapping because they want to be on the right side with the people with the most guns at that time. And it changed it quite a bit, but interesting dynamics on Kabul.
DOBBS: And tonight, as those troops are the Northern Alliance forces are advancing on Kandahar, what do you think the size of the resistance -- what is the size of the resistance they're likely to meet as they move into the south?
GRANGE: You know, Kandahar may surprise us as well. I realize it's dear to the -- to our friend Omar, the Taliban leader, but they may have, most of them, melted into the mountainsides, ready to conduct guerrilla warfare and warfare to their advantage.
And I think that the tough fight is still to come. There was not really a fight in Kabul, little -- few skirmishes. The tough guys are down there. That's where you have the 55th brigade, I believe. And you have mercenary units from outside Afghanistan, out of the legion of bin Laden. And that -- they're going to be a little tougher to take out. And they'll have to be killed.
DOBBS: And they will draw, I'm sure, rather than say I'm sure, I'm going to ask you. I assume they will draw now the full attention of U.S. and British forces?
GRANGE: Yes, I would think so. And the question's going to be, if they are hidden throughout the mountainous area, who's going to go in and get them? You know, the international coalition against terrorism has accomplished almost two of the three objectives. They denied the sanctuary of Afghanistan to al Qaeda network. That's literally been almost accomplished. They have destroyed or denied the support system to al Qaeda.
The primary mission, however, the number one mission, and that is to take down al Qaeda, to the destroy it. And the hardcore terrorist cadre and support cells of the Taliban around it has not been accomplished. And it's to be seen who's going to do that, because that's going to be, I suspect, tougher.
DOBBS: And Defense Secretary Rumsfeld today making it clear, this is by no means while gratifying, even near the end of the beginning. General Grange, let me ask you. We have seen in the coverage from Kabul and from Afghanistan as the Northern Alliance moves its advance ahead, we have seen people cheering, shaving their beards, shouting for joy, music returning to the population that had been prohibited for so long under the Taliban. We're also seeing imagery of some claimed atrocities, that is the executions, summary execution apparently of some Taliban. What is your reaction as a former general to this?
GRANGE: Well, I think it truly is a national swelling of reaction to the Northern Alliance coming in. I think the Taliban rule truly oppressed people. And many of the people, including Pashtun, that mainly feed into the Taliban forces.
Those peoples really are relieved to have the Northern Alliance come in, and secure those cities and that. But you're going to have -- you still have some revenge. You're going to have killings, atrocities. In Mazar-e-Sharif, you have them. You have some already in Kabul. Those pictures that we saw earlier are of Taliban prisoners. I'd sure hate to be a prisoner in the hands of the Northern Alliance right now.
It's going to happen. We're not going to stop it. They're going to torture and kills some people. And it's just the mentality of a Genghis Khan warrior type tribal history of warfare that that happens. And the United States or Great Britain and no one else is going to stop it. It's going to occur. And we're going to have to accept that as conditions continue ahead here on this war against this terrorist organization and of al Qaeda.
DOBBS: General David Grange, thanks for being with us.
GRANGE: Thank you, Lou. DOBBS: Now let's turn to the latest developments in the investigation into the crash of American Airlines flight 587. A preliminary investigation showing no evidence of internal engine failure. But on the cockpit voice recorder, which was recovered yesterday, rattling sounds, that is rattling sounds in the structure of the aircraft can be heard. And shortly later, the pilots can be heard struggling for control of the aircraft.
Today, the National Transportation Safety Board found the air crafts other black box, its flight data recorder. That recorder will also be analyzed for clues to the crash. It has been sent to Washington, D.C., for analysis.
American Airlines flight 587 went down in a residential area of New York yesterday. All 260 people aboard the aircraft were killed. At least five people on the ground tonight remain missing.
The NTSB says it has also recovered the plane's rudder. It was submerged in the water near the crash site. That rudder will be examined for clues into the crash as well.
At this point, investigators say there is no evidence that terrorism was involved. And they are focusing their attention on an accidental cause.
A minor security breach delayed scores of flights in Seattle today. An airport food service worker ignored a metal detector alarm to catch a waiting shuttle train. There were concerns that she might have left something dangerous inside the terminal. She did not, but that incident highlights concerns about airport security and the lack of a security bill from Washington.
Kate Snow joins us from Capitol Hill with the very latest. Kate?
KATE SNOW, CNN CORRESPONDENT: Well Lou, remember we have a difference between what passed the Senate and what passed the House. And that's why there's no security bill just yet. The House passing a version that allows for private companies to be involved, as security screeners. The Senate passing a version that says only federal employees would be able to do security screening.
So for about an hour and a half this afternoon, they tried to work out a compromise on this. Members of the Senate and the House who have been assigned to work on a conference committee were trying to work out something in the middle.
Senator Kay Bailey Hutchison, a Republican from Texas, who has opposed the President on this one, said that she would offer a compromise position. She originally favored using federal employees. Well, now she's offering a compromise, where at the 31 busiest airports in the country, federal screeners would be required. But at the smaller airports, the less busy airports, there could be some combination of federal versus private. Those airports could opt to have federal employees or they could opt to have private companies do the work. Senator Hutchison says this is all meant as a first step toward a compromise. (BEGIN VIDEO CLIP)
SEN KAY BAILEY HUTCHISON (R), TEXAS: We are diametrically opposed between the House and Senate. And if we don't talk to each other about how we can fashion something that everyone feels is comfortable and treats every airport equally, we're going to still be here on December 14, arguing about this bill.
(END VIDEO CLIP)
SNOW: But there was a lot of criticism of her approach. Many people saying that if you do things that way, you create sort of a separate system for large airports and for small airports. A difference between small towns and larger towns they said, that that would be big problem that they would have with that kind of procedure.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Under the hybrid system, you're willing to set up federal dollars, going in, federal pay, federal standards, federal accountability, but you're going to somehow put this middle person in between, who has nothing to do with the responsibility that you're ultimately asking federal government to exercise.
(END VIDEO CLIP)
SNOW: Now another part of Senator Hutchison's proposal would be that anyone who connects through a hub airport would have to be rechecked. That passenger would be rechecked at that hub airport. Several senators and Congressmen point out that that would be an inconvenience, saying that they were representing smaller towns. And they wouldn't want their passengers to have go through that kind of a logistical nightmare.
Still, Senator John Mccain, who has been very outspoken on all this, he's supporting Senator Hutchison's proposal as a first step. And they're set to meet again, Lou, tomorrow to see if they can't work out some kind of a deal.
Lou?
DOBBS: Kate, in an impasse such as we have here over airport security between the Senate and the House, these things are usually, of course, resolved in conference, and they are resolved by the leadership of both the Senate and the House. Where is the leadership here?
SNOW: Well, the leadership is divided as well. I mean the leadership of the House feels very strongly about allowing private companies to do some of this work. The leadership of the Senate, Senate majority leader Daschle, feels very strongly on the other side, that he should be federal employees doing the work.
A lot of people saying that the White House is going to need to get more involved this week. Many Republican aides saying that if the White House inserts itself this week, and really, if it comes down to the wire, that perhaps people will feel more strongly about working out some kind of compromise.
One other note, Lou, all sides saying today they really want the leaders saying they want this done, before the end of this week.
DOBBS: Well, certainly air travelers do. Kate Snow, thank you very much from Capitol Hill.
Coming up just ahead, security at the nation's nuclear power plants is being intensified. but there could be a more tempting target than reactors for terrorists. The report will include why we should all be concerned. It was considered at one time, by the way, one of the best position to emerge from the downturn in air travel. The crash of flight 587 has changed all of that. Coming up, we'll a look at the financial future of American Airlines and indeed the industry.
And trying to jump-start this economy, but are lawmakers any closer tonight to finding common ground? That story and a lot more coming up next. Stay with us.
ANNOUNCER: After the break, Lou speaks with Steve Forbes, president and CEO of "Forbes."
(COMMERCIAL BREAK)
DOBBS: The Senate tonight is debating the Democratic plan to jump start the economy. The House has already passed a pro-business stimulus bill, that offers nearly $100 billion of tax breaks. The Democrats are pushing a plan they say will give American workers a break. The net result tonight, the bipartisanship so evident in the wake of September 11, now seems quite remote.
Tim O'Brien reports from Capitol Hill. Tim?
TIM O'BRIEN, CNN CORRESPONDENT: Lou, in a way, it has all the trappings of a payback. You'll recall Democrats were outraged when Republicans in the House last month passed $100 billion economic stimulus package, with really little regard to what Democrats had wanted, very little spending. 99 percent of that Republican plan was in tax cuts.
Well, now we have sort of a mirror image of that. Unlike the House though, Democrats control the Senate. So they're now trying to push through a $67 billion package, most of it in new spending to bolster and expand health care coverage and unemployment benefits for those who've lost their jobs. The Democrats' plan was forcefully defended by Senator Ted Kennedy, line by line.
(BEGIN VIDEO CLIP)
SEN TED KENNEDY (D), MASSACHUSETTS: What is their resistance? What is their reluctance? Why aren't they willing to look after what is most important in a recession, and that are the real people that are suffering? The workers that are suffering. Men and women, who want to go to work today and can't go to work because their jobs have been lost to them.
(END VIDEO CLIP)
O'BRIEN: Well, one reason might be that the Democrats' plan offers so much less to business than the Republicans have demanded. Republican senators say they will use procedural rules to prevent the Democrats plan from ever even coming to a vote, at least not in its present form. Nobody really wants that. And earlier today, the Senate Republican leader appeared conciliatory.
(BEGIN VIDEO CLIP)
SEN TRENT LOTT (R), MINORITY LEADER: These are not, you know, high hurdles. These can be worked out really quickly, once we ever say OK, we're through positioning. This is too important for the country, this is about our economy. It's about job security. We're going to do this.
(END VIDEO CLIP)
O'BRIEN: And Lou, there seems to be a consensus that they really are going to do this, but that's with airline safety, there was no sign of any kind of a deal or any kind of a compromise on this today.
DOBBS: OK, Tim, thank you for the progress report. Tim O'Brien.
Joining me now for more on the impasse in Congress and what should be done to stimulate this economy, the president and CEO of "Forbes" magazine, Steve Forbes.
Steve, good to have you here.
STEVE FORBES, PRESIDENT, CEO, "FORBES": Good to be with you, Lou.
DOBBS: Well, let's start with the absence of bipartisanship over these two issues: airport security and economic stimulus. We're over two months. We have not got an airport security bill, nor does it look like we will have one quickly, as Kate Snow reported. How long do you think the American people are going to tolerate this?
FORBES: Well, I think the condition of the airlines is going to force their hand in the next few weeks. They're now hemorrhaging after this crash yesterday. Travel is probably going to take another hit. And so, I think that financial bleeding is going to force them to do something on airport security.
DOBBS: Airport security. Should it be run by federal employees with federal training, federal pay, federal standards? Or should it be private security?
FORBES: If you're interested in real airport security, you should put the airport in charge of it, have federal standards like the Israelis do, and the Europeans do, and have people who can be removed if they don't do the job, and the airport shut down if it's not doing the job.
DOBBS: Private or... FORBES: Private with federal standards.
DOBBS: But when we look at the example of Argenbright, the leading security firm in airports, fined a million dollars a year ago, all sorts of violations this year, no accountability whatsoever, not one person has been fired for those breaches. Why should anyone tolerate that kind of performance?
FORBES: Well, Argenbright's under the auspices of Federal Aviation Authority, the FAA. Did not have standards, did not have true airport security, like the Europeans and the Israelis have.
DOBBS: Certainly not to that level, Steve, but they do have standards. And they violated. They've been fined a million dollars last year alone for those violations.
FORBES: Well, look at other federal agencies, like the INS have not done a very good job in their area. I think here, we've got to take a page from the Israelis and from the Europeans, who have beefed up airport security, put the airport in charge of it, with explicit standards. Putting the airlines in charge of it, they're always trying to cut expenses. Put the airport in charge of it, and if you need the money, you put on a ticket tax. People pay the extra $10 or $20 bucks if they know the airport is secure.
DOBBS: Economic stimulus. The Democrats have one plan, the Republicans another. What's the best solution there? Which of the two should prevail?
FORBES: I think actually the Senate Republican plan is probably the best one, which hasn't seen light of day. But what they would do is make all the rate cuts that were passed last summer and phased in over 300 years effective January first.
And I think the House plan of reducing capital gains should be put in there. If you want a little spending to grease it for the Democrats, fine. Little rebates to grease it, fine. But get those rate cuts and especially on capital gains. And I think this economy has a chance next year.
DOBBS: Rate cuts for business or for individuals?
FORBES: Primarily for individuals, because remember, a lot of small businesses are filing under Subchapter S and affected by individual rates. So business accelerate depreciation schedules...
DOBBS: Particularly small business.
FORBES: Small businesses, absolutely.
DOBBS: This business of rolling back corporate income tax, tell me you're not one of those who supports that?
FORBES: I don't, but I like the idea that you and I can get 15 years of our past taxes rebated, but I don't think that's what the economy needs. DOBBS: What is your sense? When are they getting serious? When are they going to get it done because this economy does require stimulus here.
FORBES: Well they don't do it in the next few days. I think Thanksgiving, they're going to get an earful of people who are worried. They are anxious. And I think after Thanksgiving, they'll get down, do a real negotiation.
DOBBS: The President has been patient to this point, but it looks like action is...
FORBES: Well, the White House has got to push, because the boys and girls in Capitol Hill can't do it on their own.
DOBBS: And in terms of the progress of this war, it is extraordinary what we have seen in terms of progress. Your thoughts from here?
FORBES: Well, it has been absolutely extraordinary, but I think the real next one is going to be what do you about the south. I think the Taliban will be forced to flee. Then the next thing is what we do about Iraq.
DOBBS: And your recommendation?
FORBES: Make a deal with the Turks to take northern Iraq, which is Kurdish, which is where most of Iraqi oil is. That would bring the downfall of Saddam and have part of Iraq in the hands of a firm ally.
DOBBS: And in terms of Saudi Arabia, which has been ally but it is -- a very difficult situation to say the very least?
FORBES: Very least, but I think the victory in Afghanistan will strengthen the hand of the government. And I think with the Saudis, we've got to put pressure on them, as well as the Egyptians to stop this vitriol in their domestic press, and to really cut off the funding for terrorist forces.
DOBBS: OK, Steve Forbes, as always, good to see you.
FORBES: Good to be a with you, Lou. Thank you.
DOBBS: Coming up next, we'll have the latest for you in the war against terror. Kabul residents tonight cheering. Northern Alliance soldiers rolling into the capital, now advancing on Kandahar. But with celebration, some concern. Also coming up, the investigation into the crash of flight 587 and the financial future for American Airlines. We'll take a look at how the carrier can recover after three devastating crashes in two months. All this amid one of the worst economies in a very long time.
ANNOUNCER: ...former managing director of the National Transportation Safety Board.
(COMMERCIAL BREAK)
DOBBS: Here are the latest developments now in the war against terrorism. Anti-Taliban forces now control the Afghanistan capital of Kabul. The Taliban are withdrawing. They are retreating to Kandahar. Troops of the Northern Alliance in pursuit tonight.
There are concerns that the Taliban forces will be waging a guerrilla war against the Northern Alliance. There are also rising concerns that the country could be headed toward anarchy.
Hoping to prevent that, of course, world leaders are meeting, trying to piece together a new government for Afghanistan. The Northern Alliance is asking for help from the United Nations. They have been in contact with the United Nations.
And in this country, the State Department is looking for an anthrax-laced letter. Officials tonight say a contaminated letter may have moved through the system undetected.
And Howard University has closed eight mail facilities on its campus, after small amounts of anthrax were found in the school's main mailroom.
Now the latest on the crash of American Airlines flight 587. Investigators say rattling noises could be heard on the cockpit voice recorder. A short time later, the pilots can be heard struggling for control on the aircraft.
Peter Goelz joins us now. Peter is the former managing director of the National Transportation Safety Board.
Peter, let me say, first of all, thanks for being here. And I know it's difficult to analyze this without certainly all the information. It's difficult enough for those who have it. But what is your sense of what you have now heard about the cockpit voice recorder itself?
PETER GOELZ, FMR. MANAGING DIRECTOR, NTSB: Well, this investigation, Lou, took a very perplexing turn this afternoon. I think there were two critical pieces of information that the Safety Board released. The first was that the engines, when examined, showed no signs of ingesting any birds, no sign of catastrophic failure. And then the second piece of information was, as you identified, the voice recorder, which indicated that the event from start to finish was less than 30 seconds.
DOBBS: Right.
GOELZ: That they apparently entered a wake vortex from the plane in front of them, battled the plane. They entered it again. And then the events started to take place. And it was over very quickly.
DOBBS: Before we ask you to go into that, could you explain to everyone what a wake vortex is?
GOELZ: Sure. When a plane takes off, it leaves behind an invisible path in the air that is disturbed. And there are regulations in the four planes. In this case, a 747 had taken off a few moments before the American Airlines plane. It was about seven miles out. The distribution of space is about four miles for safety. So there was plenty of room, technically, for the American Airlines plane.
DOBBS: So we're beginning to get a sense of the situation, obviously. I know the NTSB has now followed the flight path of 587. 30 seconds, all of this occurring. Give us your best judgment as to where this investigation goes now?
GOELZ: Well, it's very perplexing. And then it began yesterday when they lifted the horizontal stabilizer, the tail of the plane, out of Jamaica Bay. What that was doing there was very perplexing. And it meant that that tail came off early in the incident, perhaps first. And how to explain that is difficult.
DOBBS: Well, you have considerable experience in these matters. Have you seen another example in which the horizontal stabilizer has fallen off an aircraft?
GOELZ: I've never seen one like this. The FAA and the NTSB has done a lot of work on wake vortexes on these, you know, spiraling air pockets. They can be dangerous, but in all cases when a plane entered it, you could recover from it.
This is pretty perplexing and I think we're in for a difficult investigation unless the flight data recorder gives us some critical information tonight.
DOBBS: And you seem to be focusing on that horizontal stabilizer. Do you seem to think that is the primary area for focus here?
GOELZ: I think once the engines came up relatively clean, the focus of attention has got to go to the stabilizer and why it separated from the plane.
DOBBS: And with your experience, you would concur with what appears to be the position certainly the FAA to this point, that this is -- it appears then an accident?
GOELZ: Well, at this point, you cannot eliminate an act of terror. But all evidence indicates that this remains a mechanical or structural accident.
DOBBS: We thank you very much, Peter Goelz.
GOELZ: Thank you, Lou.
DOBBS: Thank you.
Well, American Airlines, of course, was suffering long before the attacks of September 11, as were so many airlines. But as a slowing economy has cut into its ticket sales and that of the industry, things have only worsened since September 11. Over the past two months, the company has lost three aircraft, their crews and passengers.
Kitty Pilgrim takes a look at the company and its future.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): The flag at American Airlines headquarters now hangs at half-staff. A saddened CEO stands at a microphone with the knowledge that the company has lost three planes since September 11.
DONALD CARTY, CEO, AMR: Today's news comes at a difficult time for the nation, a difficult time for the airline industry, and a very difficult time for American Airlines.
PILGRIM: Employees are frantic about their jobs.
RUSSELL LANGHAMMER, AMERICAN AIRLINES CREW CHIEF: You see what's going on with the business right now. The economy's terrible. You know, we're just trying to do a job.
PILGRIM: Analysts say bookings are down about 25 percent for November. Some point to the expense ratio, not just for American, but for the entire industry in this climate,
MIKE MILLER, EDITOR, "AVIATION DAILY": Their expenses are very high and their revenues are pretty low right now. So until they improve that revenue expense mix, it's going to be difficult.
PILGRIM: AMR stock has been under severe selling pressure since September 11 and selling off again heavily after the most recent crash of flight 587. Yet analysts point to several positives. American has about $3 billion in cash and $8 billion in assets that can be used to guarantee loans. In fact, American is in such good shape financially, it did not need the loan guarantees other airlines asked for in the airline bailout package.
SUSAN DONOFRIO, DEUTSCHE BANK ALEX BROWN: I really think they are in an excellent position financially. And I think that is just confirmed by the fact that they have not needed to apply to Washington for a loan guarantee.
(END VIDEOTAPE)
PILGRIM: On Wall Street, the real focus on the airline industry is, of course, in Washington. Now hopefully some compromise on the aviation securities bill will emerge by Friday, and hopefully be passed before Thanksgiving break. And that will be key in determining just how business is conducted in the future.
Lou?
DOBBS: Kitty, thank you very much.
Well, coming up next, it may be difficult to believe that the tranquil looking pools like this are potential targets of terrorists, but we'll be telling you why they are potentially dangerous. And a solid rebound today on Wall Street. Both the Dow, the Nasdaq climbing well over 2 percent on the day. We'll take a look at a bonafide rally. Next, it's worth waiting for. Stay with us.
(COMMERCIAL BREAK)
DOBBS: With no permanent federal nuclear waste dumpsite available, 40,000 tons of spent nuclear fuel is piling up in power plants around the country. Critics say these nuclear warehouses serve as prime terrorist targets because there is virtually nothing protecting them. Steve Young reports.
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STEVE YOUNG, CNN CORRESPONDENT (voice-over): They look like placid blue lagoons, but some people now fear that spent nuclear fuel pools could be turned by terrorists into a kind of hell. The United States has no long-term storage facility to hold them. That's why most of the uranium rods that were used to generate electricity have been piling up like this on site.
The atomic reactors, which are powered by the rods, are protected by bunker-like concrete containment buildings. But all that surrounds the fuel pools are ordinary concrete buildings or even corrugated structures. With the nation on terrorist alert, several scientific and public interest groups share the same concern. If an airliner or a shoulder mounted missile smashed into a spent fuel pool that could drain the water that keeps the rods cool. Once the pool was empty, there would be an evacuation window of as little as two hours. Then the metal outer layer of the rods could overheat and catch fire.
MICHAEL KOHN, NATIONAL WHISTLEBLOWER CENTER: After that, the radiation will start being released in massive quantities without any way to contain it or to stop it. And it's just a matter of the plant or the containment or the pool burning itself out and seeing how much radiation is released and which way the wind was blowing.
PAUL LEVENTHAL, PRESIDENT, NUCLEAR CONTROL INST.: The spent fuel will not explode like a bomb. But what you would have is a fire and a chimney effect of the radioactive debris from the melted down fuel going directly into the atmosphere and floating down wind of the plant.
YOUNG: Brookhaven National Laboratory did a study for the Nuclear Regulatory Commission four years ago. It found a spent fuel accident could cause 20,000 cancer fatalities, nearly $60 billion in damage, and leave nearly 200 miles of land unfit for habitation.
(END VIDEOTAPE)
(on camera): An NRC spokesman tells MONEYLINE, since September 11, security around spent fuel pools has been tightened, along with everything else at nuclear power plants. He says the chances of a spent fuel catastrophe are remote because the pool walls are five feet thick, the buildings are, he says, hard to spot, and the spokesman adds, airliners aren't dive-bombers -- Lou. DOBBS: Steve, the NRC, the nuclear power plant operators themselves, what additional steps are they taking to raise the security levels?
YOUNG: They will not discuss in any detail what they're doing. In conversation with me, the NRC spokesman said that, you know, you could always, he said, fill the pool with a hose.
DOBBS: OK, anything else?
YOUNG: That was the extent of our conversation.
DOBBS: OK, Steve, thank you. Steve Young.
Well, a powerful rally today on Wall Street. We are pleased to tell you stocks sharply higher today, following military gains and successes in Afghanistan and a growing sense that yesterday's plane crash was an accident.
The Dow surging nearly 200 points today. It's at its highest level now in two months. The Nasdaq and S&P 500 sharply higher as well. Christine Romans at the New York Stock Exchange. Greg Clarkin, there he is, at the Nasdaq marketsite with the details. Christine, a very fun day.
CHRISTINE ROMANS, CNN CORRESPONDENT: Yes, solid advance, Lou, and some notable winners, especially when you look within the Dow. Home Depot comes out and has a solid third quarter. In a tough retail environment, it does well. GM also doing well here. Its chief products designer Bob Lutz will become chairman of North American Auto Operations. Ron Zarrella going to Bausch & Lomb after seven years.
3M coming out saying it's going to set a stock buyback of $2.5 billion. Alcoa may be close to buying Australian WMC for $6 billion in stock and cash. And the financials strong all session.
Among the big board movers, Enron. After the bell, a spokesman for company saying that Ken Leahy will waive his big $60 billion plus severance if that Dynegy deal goes through. He says it's the right thing to do. Compaq, a positive note from Lehman's Dan Niles. Texas Instruments affirming its fourth quarter expectations.
AMR and the airlines bouncing back a little bit here today, but Watson Pharmaceuticals down 38 percent. It's a generic drugmaker. It badly missed Wall Street's expectations. It revised downward its expectations going forward. Says it's going to have to redesign its entire outlook, a cut-throat generic drug market for Watson Pharmaceuticals.
Lou?
DOBBS: Christine, thank you very much. Let's turn now to Greg Clarkin at the Nasdaq marketsite. The Nasdaq up almost 3 percent today. You had a little fun, too, right? GREG CLARKIN, CNN CORRESPONDENT: I tell you, Lou, it was a solid day. That military news really just providing a tremendous psychological boost to the markets. And we saw the Nasdaq, but all sectors higher, even the software sector, which had a profit warning from Oracle. That stock fell, but the sector was nicely higher.
And there are some of the movers on the day. Intel gains $1.67, that after Texas Instruments had some fairly positive things to say about the semiconductor business. Microsoft, up better than $2.00. Cisco Systems with 32 cent gain. Sun continued its rally, now trading over $13 a share. That stock was $8 not long ago.
Oracle, meanwhile, it lost ground again after that profit warning. But still, every sector is nicely higher today. The Nasdaq now within 8 points of 1900. And that's a level it hasn't traded over since late August. A gain of 51 brings it to 1892 today.
Lou?
DOBBS: Greg, thank you. Greg Clarkin over at the Nasdaq.
And new evidence tonight that the economy slipped into recession, earlier than most people thought. Perhaps several months ago. The National Bureau of Economic Research, the official arbiters of recession, pointing to some telltale signs of weakness that appeared as early as last spring.
Kathleen Hays is here to tell us all about it.
Kathleen?
KATHLEEN HAYS, CNN CORRESPONDENT: Thanks, Lou. Well of course, people are probably wondering, why is it so complicated to figure out the beginning of a recession? Isn't it two negative quarters of GDP, Gross Domestic Product?
Well, no. Actually it's not, not according to the NBER. And they're the official arbiters. Here's what they say it is. It's a significant decline in activity, spread across the economy, lasting more than a few months, visible in industrial production, employment, real income, and wholesale and retail trade, make that business sales.
Now for months, every month they put up a posting on their web site, they have refused, at least in public to even discuss whether or not we are in a recession. But today, a new posting.
DOBBS: Discuss it?
HAYS: Well, they talked about it, but you know what they were saying?
DOBBS: That's very ivory towerish, isn't it?
HAYS: They were saying, Lou, that personal income was holding up and employment was holding up. So they were discussing it, but they weren't even hinting they were going to convene officially to date the recession. This letter posted November 9, now is saying March looks like the beginning. And so what changed? Everybody wondering what changed.
DOBBS: I was just hoping desperately to find out what changed.
HAYS: Glad we asked. OK, well, it wasn't industrial production because it's been weak for a while. This is the one thing that most everybody agrees that it looks like it was in recession It's been declining since 2000.
You know what changed? Employment. There's industrial production. Look at that blue line. That's the last couple year's worth. The yellow line is the average of what industrial production -- well, look how long ago it peaked. What caught their eye finally is employment, because employment, they're finally looking at the fact that it did peak. And in fact...
DOBBS: Lots of change.
HAYS: It's the blue one, coming down with the yellow line.
DOBBS: These are the most incredibly illustrative graphics we've seen here in some time. HAYS: I did my best for you. I really did.
Anyway, I spoke to Ben Bernanke. He's a Princeton professor. He's on their committee. It sounds like it really did make the difference. Employment, it's decelerating at an accelerating rate. It's not just the attacks. The economy already...
DOBBS: He didn't really say decelerating.
HAYS: Well, no, I kind of paraphrased. Want the good news? I'll tell you tomorrow.
DOBBS: Quickly.
HAYS: 11 months is the average for a recession. If it started in March, we could be off by February or March. That's the good news in this.
DOBBS: That to me...
HAYS: More on that tomorrow.
DOBBS: We'll have more tomorrow. Let's start with that one.
HAYS: OK.
DOBBS: All right, Kathleen Hays, thanks.
Coming up next, we'll have your thoughts on airline security and what you believe should be done. And the parent of two rental car companies filing for bankruptcy. Those stories and a lot more, still ahead. Stay with us.
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DOBBS: In corporate news tonight, ANC, the parent of Alamo and National Car Rental, filing for bankruptcy protection. ANC becoming the latest victim in the sharp decline in air travel. Shortly after September 11, CEO Michael Egan warned the company would face difficult circumstances and might not survive without government help. But so far, the airlines have been the only industry to receive federal funding. ANC says customers of the two companies will not notice any difference in services. And the company will be honoring all reservations and providing full service.
Oil prices also suffering from the sharp decline in travel, but on the rise today. President Bush is ordering the government to add millions of barrels of oil to its emergency reserves. Prices were already higher ahead of tomorrow's expected production cut to be announced by OPEC. Light sweet crude today rose 44 cents, settling at $21.67 a barrel.
"WOLF BLITZER REPORTS" begins in just a few minutes. Let's go to Wolf now in Washington, to find out what's ahead. Wolf?
WOLF BLITZER, HOST, "WOLF BLITZER REPORTS": Thank you, Lou, extraordinary developments on the ground in Afghanistan. The Northern Alliance takes the capital Kabul, as the Taliban forces retreat.
What's next? We'll go into the CNN war room with three guests, the Northern Alliance envoy Harun Amin, the former Nato commander retired general Wesley Clark, and a former U.S. envoy to the Afghan resistance, Peter Thompson. That and much more. It's all next.
Lou?
DOBBS: Looking forward to it, Wolf, thanks.
Coming up next here, we'll take a look at your thoughts and take a look at what to expect tomorrow as well. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Taking a look ahead to tomorrow. OPEC ministers will meet in Vienna to discuss cutting oil production. Some expecting a cut of as much as 1.5 million barrels a day. That in an effort to push prices back toward $25 a barrel.
Fed Chairman Alan Greenspan will talk to the U.S. Chamber of Commerce, addressing the issues of potential policy challenges facing the economy and business leaders.
Quarterly earning will be reported by Applied Materials, retailers Federal, Tiffany, Ann Taylor. And after tomorrow's closing bell, Weight Watchers expected to price its IPO. And tomorrow night, Daniel Yurgen, one of the world's foremost experts on energy, the chairman of Cambridge Research will be here on MONEYLINE. Please join us.
Now let's take a look at some of your thoughts. On the issue of airline security, Pamela Szymanski writes in to say, "The root of the problem, airlines have been cutting corners for just too many years." And she has a solution. They have to "suck up the costs of fixing the problems for us to feel comfy flying again."
As the House and Senate tonight try to bring their airline security bills together, Norman Harrold in Oregon writes in to say he has 36 years of military and civilian air service and says making baggage screeners federal employees is simply not the answer. He writes to ask, "Who do you think will be end up being hired to fill those new federal service jobs?" Norman asks, "Have you ever seen anyone do a better job just because he or she got a pay raise?
Another security question concerning the nation, anthrax. Mike Stewart writing into say, the crisis may be winding down. So now's a very good time to take stock of what it means. He writes, "If you want to frighten the American public, first frighten the media."
And finally John from Canada writes in to say he has a word for all those who second guess the American Red Cross' allocation of funds. "The crash of American Airlines 587," he writes, "proves the point. It is smart to save for other tragedies. The residents of Rockaway," he says, "would agree."
Please send us your thoughts moneyline@cnn.com. Please included your name and address. And for this Tuesday evening, that's MONEYLINE. Thanks for being with us. I'm Lou Dobbs. Good night from New York.
"WOLF BLITZER REPORTS" begins right now.
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