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Lou Dobbs Moneyline
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Aired December 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 Thursday, December 13. Here now, Lou Dobbs.
LOU DOBBS, CNN ANCHOR: Good evening, everyone. Today Americans watched the Osama bin Laden videotape and tonight many are more convinced than ever that he should die. On that videotape, Osama bin Laden admitted that he is the mastermind behind the September 11 attacks against the United States, attacks that killed thousands of innocent people.
Bin Laden on the videotape explains how he planned those attacks and how he calculated the level of destruction and death that would result when those jetliners crashed into the World Trade Center towers.
Kelly Wallace is at the White House tonight. Kelly, what was the reaction there after the tape was released?
KELLY WALLACE, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, U.S. officials say the tape speaks for itself and people will draw their own conclusions. But Bush advisers also say the tape vindicates what they have been saying all along about Osama bin laden.
And, Lou, the administration also very heartened by the fact that the tape is being used throughout the Arab and Muslim world. We know a number of Middle Eastern and Central Asian television networks are airing at least portions of the tape. The administration also making the tape available in Arabic to any country which might want it.
And Secretary of State Colin Powell saying today, he believes this tape could put to rest any doubts that might still exist in the Arab and Muslim world about bin Laden's culpability in the September 11 attacks.
(BEGIN VIDEO CLIP)
COLIN POWELL, SECRETARY OF STATE: How could there be a doubt in anyone's mind any longer about what we have said from the very, very beginning, that he was the mastermind. He is the head of an organization that participates in this kind of evil activity. It is frightening and shocking to sit there and listen to him invoke the name of an Almighty to defend murder, to defend evil. That goes against every faith on the face of the earth. (END VIDEO CLIP)
WALLACE: And U.S. officials also hope that anybody around the world watching this tape might view bin Laden as a "false prophet." Now today, we learned the President first viewed the tape back on November 30 and aides say the President felt all along if the tape was determined to be authentic.
And also if the tape could be assessed and if it's release would not impact any future intelligence gathering capabilities, then the President felt the tape should be released to the American people and the world community in order to be forthright and get that information out there.
There is one issue, Lou, the administration not talking very much about. That is exactly how this tape got into the hands of U.S. officials. All U.S. officials will say publicly and privately is that the tape was found in a private home in Jalalabad, and then eventually turned over to the attention of the United States -- Lou.
DOBBS: Kelly, thank you very much. Kelly Wallace reporting from the White House. Well as the hunt for Osama bin Laden continues, the attacks against the al Qaeda in Afghanistan are intensifying.
The Pentagon says al Qaeda fighters have passed their second surrender deadline. Now their opportunity to lay down arms is gone. U.S. warplanes have been dropping heavy bombs on the caves and tunnels of Tora Bora.
The Eastern Alliance there is pushing the al Qaeda fighters back towards the Pakistan border. General Richard Myers today said the military would prefer to capture al Qaeda forces alive.
Meanwhile, Defense Secretary Donald Rumsfeld says he's aware of conflicting reports about the whereabouts of Osama bin Laden. But he says the United States believes bin Laden remains in Afghanistan. Rumsfeld is also asking neighboring countries, including Pakistan for their help in finding the world's most wanted man.
Christiane Amanpour is in Afghanistan tonight. Christiane, what is the situation there tonight?
CHRISTIANE AMANPOUR, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, in Kandahar itself there is a hospital in the center of town where there are some Arab mercenaries, we are told they are linked to the al Qaeda network, hold up in the civilian hospital and threatening to do harm to themselves and to any "foreigners who come near them."
They've been hold up there since this city was turned over, over the weekend. Also, we've been hearing air activity overhead, perhaps airplanes heading towards the Tora Bora area. There has been continued bombing of those cave complexes there as the second deadline, as you reported, came and went for the surrender of al Qaeda and Osama bin Laden there.
The Eastern Alliance, the anti-Taliban fighters who've been helping the United States with its own ground assault there, have been saying to the Taliban, rather to the al Qaeda leaders there, that they should give up, give up their top lieutenants, give up Osama bin Laden, or face that continued U.S. air assault.
In the meantime, Pakistani officials and intelligence officials that we've been able to talk to say that they are trying to step up border patrols and trying to do all they can to interdict any al Qaeda, and especially any Taliban or Osama bin Laden attempts to move over that border.
That tape has been watched in the Arab world, in many parts of the Arab world, the tape where Osama bin Laden says that he masterminded the hijackings and the attacks of September 11th.
They've been watched in Pakistan, in Afghanistan, and in various other Arab capitols, Jordan and Egypt. And as predicted, the initial, initial results of that in terms of a very minimal public survey is somewhat mixed. Some people, as expected, have said that that was a doctored tape, while others have said that this now proves that Osama bin Laden was guilty -- Lou.
DOBBS: Christiane, thank you very much. Christiane Amanpour reporting tonight from Kandahar.
Well the Pentagon today said rewards would soon be offered for information leading to the capture of a number of Taliban fighters. For more on that, and the U.S. military strategy in Afghanistan, we're joined by military affairs correspondent, Jamie McIntyre, at the Pentagon -- Jamie.
JAMIE MCINTYRE, CNN CORRESPONDENT: Lou, the U.S. has beefed up the relatively small number of Special Forces that are operating in the Tora Bora area, and Pentagon sources say that they, along with CIA teams are trying to capture, rather than kill Osama bin Laden, if at all possible taking him and other top al Qaeda leaders alive.
(BEGIN VIDEO CLIP)
GENERAL RICHARD MYERS, CHAIRMAN, JOINT CHIEFS: I think right now we're in the middle of a pretty big fight in the Tora Bora area. It's war and in the middle of the war, we're going to do what it takes to win that piece of it. We hope we come out of there with, of course, some intelligence information. If that means taking people alive, then that would be very good.
(END VIDEO CLIP)
MCINTYRE: Capturing rather than killing top al Qaeda leaders would provide the United States with the kind of intelligence it says it needs in order to move against other al Qaeda cells in as many as 60 countries around the world.
The U.S. has conflicting reports about bin Laden's whereabouts. Some intelligence suggesting he slipped across the border to Pakistan, but most of the evidence seems to indicate he's still in Afghanistan.
(BEGIN VIDEO CLIP)
DONALD RUMSFELD, SECRETARY OF DEFENSE: We think he's in Afghanistan. We are chasing him. He is hiding. He does not want us to know where he is. We are asking everyone we can to help.
People are providing lots of scraps of information. The Pakistanis are, the people in neighboring countries are, Afghan people on the ground are providing information. We're able to gather various other types of intelligence information. We think he's there. We don't know if he's there. We're trying to find him, and when we find him we will announce it.
(END VIDEO CLIP)
MCINTYRE: The Pentagon remains hopeful that the $25 million, up to $25 million reward for information leading to the capture or killing of bin Laden will prompt someone to give him up, and they added another price on the head of Mullah Mohammed Omar, the Taliban leader, of about $10 million or up to $10 million.
And the U.S. would like also to get this man, seen on the videotape just released today, laughing with bin Laden about the September 11 attacks. He's identified by Pentagon sources as Sheik Soloman, a Saudi who is paralyzed from the waist down.
Pentagon officials say the other disturbing aspect of this videotape is the number of references to Saudi clerics who support al Qaeda. And Pentagon sources say the U.S. is quietly warning the Saudi ruling family that it may have a bigger problem with homegrown terrorists than it wants to admit -- Lou.
DOBBS: Jamie, thank you very much. Jamie McIntyre from the Pentagon. After cutting off contact with Yasser Arafat, in the morning Israel unleashed a blistering deadly rocket attack against Palestinian targets in Gaza City and Ramallah.
Israel's cabinet called Arafat irrelevant for his failure to crack down on terrorists. Mike Hanna is in Jerusalem tonight. Mike, what is the situation there?
MIKE HANNA, CNN JERUSALEM BUREAU CHIEF: Well, Lou, any chance of any form of negotiated peace lies in tatters. Israel says it will have nothing to do with the Palestinian Authority or its leader, Yasser Arafat, and it struck at several Palestinian targets in the Gaza Strip and in the West Bank.
Many of these targets, buildings associated with the Palestinian Authority, such as police stations, police compounds, offices of Yasser Arafat's Fattah Political Party. Also caught up in the Israeli strikes though, a mosque in Gaza City, a Quaker school in Ramallah. Israel says it wasn't targeting these particular building; however, they were hit in the ongoing Israeli barrage.
As to diplomatic efforts, well the U.S. Envoy Anthony Zinni held a meeting with the Israeli Prime Minister a couple of hours ago to find out, we understand, whether or not there was any point in him staying.
There's been no statement following that meeting. The U.S. says it still recognizes Yasser Arafat as the leader of the Palestinian Authority, as does the EU and other international community figures. However, as far as Israel is concerned, it says Yasser Arafat is not relevant anymore.
It will do what it needs to do without any communication with the Palestinian Authority whatsoever. Any chance of a negotiated cease to the ongoing hostility is very unlikely after 14 months of ongoing conflict, 14 months of bleak tomorrows. Tomorrow is another bleak day, Lou.
DOBBS: Mike, if Yasser Arafat is indeed irrelevant to the Israelis, who amongst the Palestinians will they be talking with? With whom will they be negotiating in some effort surely to stop this cycle of intolerable violence?
HANNA: Well at the moment, Lou, that is the most important question at this stage. As far as the Israelis are concerned, nobody. They are going to do what they need to do, they say, to crack down on militants themselves.
Now the U.S. has a critical role to play here, to act as a mediator, to find some form of communication between the two sides. But as it stands at the moment, the Palestinians have elected Yasser Arafat.
He is their leader. He's recognized as such by the U.S. There is no one else who can speak for the Palestinian people. There is no one else for the Israelis to talk to, if at some stage they do indeed want to talk. Lou.
DOBBS: Mike, thank you very much. Mike Hanna from Jerusalem. Rising tensions in the world not helping the mood on Wall Street. Stock prices there ending the day lower. Investors concerned about profit warnings from Lucent Technologies and Ciena Corp. and a record monthly decline in retail sales.
Coming up next, we'll be telling you about that record decline in retail sales in the month of November, at a time when bonuses are becoming increasingly rare. We'll also be telling you the heartwarming story of one company and its large and generous holiday gift to its employees.
The Cold War is over, and now so is the Anti-Ballistic Missile Treaty. We'll have that story for you. And an international terrorist expert warns that we may not have heard the last of the Taliban and the al Qaeda.
ANNOUNCER: Next, Lou speaks with military strategy and intelligence expert, George Friedman.
(COMMERCIAL BREAK)
DOBBS: The United States formally notified Russia that this country will withdraw from the 1972 Anti-Ballistic Missile Treaty. Russian President Putin calls that a mistake. President Bush calls it a chance for a new relationship.
President Bush also promised to withdraw from the treaty within six months, saying the Cold War is over, and the greatest threat to both the United States and Russia come now from rogue nations and not one another. The president also says withdrawing from the ABM Treaty will allow both countries to forge closer ties.
The U.S. Airways terminal at Boston's Logan International Airport was forced to close for an hour and a half this morning, that after it was discovered some of the security personnel had no training.
The checkpoints are run by Argenbright Security. That firm is scheduled to halt operations at Logan this Friday, after the company's license was pulled because of security lapses.
At least four planes were called back this morning, and the passengers were rescreened. Argenbright Security continues to provide security at several airports nationwide, if you can believe it, including Chicago's O'Hare and Newark International Airport in New Jersey.
A Federal judge has ordered Zacarias Moussaoui sent to Virginia, there to stand trial in the September 11 terrorist attacks. Moussaoui may be receiving legal help as well from France. France has offered legal help to Moussaoui, a French citizen, because it is opposed to the death penalty.
Meanwhile, Moussaoui came to this country well funded, and as Allan Dodds Frank now reports, the money flow to Osama's operatives began more than a year before.
(BEGIN VIDEOTAPE)
ALLAN DODDS FRANK, CNN CORRESPONDENT (voice over): The money fueling the hijackers began flowing from Dubai in the United Arab Emirates to the United States in June of 2000. The first two Dubai accounts were at Standard Charter Bank.
MICHAEL ZELDIN, DELOITTE & TOUCHE: Picking a global bank in Dubai provided two opportunities. One, easy access into the Dubai market, then use of the international payment system, the wire transfers direct, Dubai, Florida, no intermediaries, no intermediary scrutiny, easy access, mission accomplished.
FRANK: The first money was wired to Marwan al-Shehhi, the hijacker who flew the second plane into the World Trade Center. A transfer of $4,790 sent June 29, 2000 from Dubai to New York City. Twenty days later, another $9,985 to a Sun Trust Bank Account in Florida in the names of al-Shehhi and Mohamed Atta, the hijacker who flew the first jet into the World Trade Center.
In the next two months, three more payments totaling nearly $100,000. As they trained, nine different hijackers opened accounts at Sun Trust, complete with credit cards and ATM cards. JOSEPH JAFFE, DECISION STRATEGIES: That they used small, consistently small amounts and they do it from various places and they replenish it and withdraw it, shows an intricate knowledge of the system.
FRANK: And according to the Justice Department indictment, the man authorities believe was supposed to be a part of the hijacking team, Zacarias Moussaoui, declared a bundle of cash as he breezed through U.S. customs.
ALVIN JAMES, ERNST & YOUNG: He brought in $35,000 in a satchel and reporting that correctly to customs as you cleared through the U.S. border is a fairly gutsy move considering what they had in mind to do with that money.
(END VIDEOTAPE)
FRANK (on camera): Shortly before three of the hijackers left Florida, they sent more than $15,000 in excess cash back to their paymaster in Dubai. He then prepaid a Visa card and fled to Pakistan. After the attacks, he withdrew money from automated teller machines -- Lou.
DOBBS: Let me ask you, Moussaoui was in no way on any sort of suspected terrorist lists on the part of the United States Government?
FRANK: No, and he came in through the front door. He declared everything, stayed calm, got in.
DOBBS: Extraordinary. All right, thank you very much. Well this word just in to CNN. The Senate has approved an increase in spending for intelligence, proving an eight percent increase in spending for intelligence. That just passed by the U.S. Senate.
The Pentagon today saying it would prefer to catch al Qaeda and Taliban forces alive rather than dead, but says it is up to them should they choose to fight to the death. My guest now says tens of thousands of Taliban forces have escaped to the countryside, where they could well mount a guerrilla war campaign. George Friedman is an expert in security and intelligence issues. He is the founder and chairman of STRATFOR, a private intelligence company. And, George, it's good to have you with us.
GEORGE FRIEDMAN, STRATFOR: Good to be here.
DOBBS: What you are declaring here tonight, that there are tens of thousands of Taliban and al Qaeda fighters in the countryside prepared for guerrilla warfare suggests a crying need for more, not less U.S. military in Afghanistan, does it not?
FRIEDMAN: Well, remember what the goal of the U.S. was in Afghanistan. It really wasn't to create a new government in Afghanistan. It was to deny al Qaeda a base from which to operate. We've pretty much achieved that. It's going to be very hard for bin Laden or any of his successors to operate from Afghanistan. The question of what kind of government is going to come after the Taliban government, is really not of fundamental interest to the United States, and we've treated it as such. We have not tried to break the Taliban, except to break their hold on the cities. We've really left the entire military situation to native Afghan forces.
DOBBS: You're quite correct, but it is also correct, is it not, that the President said that the Taliban and the al Qaeda would be destroyed?
FRIEDMAN: Well, he made it very clear that the intention was to destroy both, but the kind of forces that were allocated were going to be sufficient for capturing, if possible, the leadership of both groups. It wasn't going to be sufficient to destroy what was after all a 40-50,000 man army prior to the attack.
We've captured about 5,000 it said, but we assume that 5,000 or 10,000 were killed. That still leaves an awful lot of Taliban going to ground in the countryside waiting for the next opportunity.
DOBBS: Your estimate of 5,000 captured, 5,000 to 10,000 killed or wounded, highlights one of the extraordinary aspects of this engagements on the part of the United States. There has not been, if you will, a body count of any note emerging from the Pentagon, obviously, done quite intentionally. What do you think the reasoning is?
FRIEDMAN: Well, first it's very hard to do a body count. Most of the U.S. military action was from the air. It's kind of hard to tell from 10,000 feet how many people you've killed. You're getting a lot of reports from allied groups on the ground who have an interest to inflate the numbers.
What we do know is how many prisoners seem to be held. That number is currently being put in the 5,000 range. We're guessing about everything else.
DOBBS: And we're obviously guessing about the whereabouts of Osama bin Laden. If these contradictory reports can be sort of settled into one prevailing view, do you believe Osama bin Laden is still in Afghanistan?
FRIEDMAN: I find it very difficult to understand his reasoning for remaining behind, particularly at Tora Bora. He'd be cut off, unable to control his international network. It would have made a lot more sense for him to slip across the border when it became clear that the Taliban was going to lose the cities.
On the other hand, it's altogether possible that he was killed in a bombing raid and we simply are never going to find his body. And there is one theory that's kicking around the Internet for what it's worth, that we've already captured him and are not releasing that because we don't want al Qaeda to know that we have him, so that the succession is hindered.
By the way, there's absolutely no proof to that or evidence of that, except for rumor. If I had to bet, I would bet that he's across the border and either gone to ground in Pakistan where he has an awful lot of support, or left the country.
DOBBS: And again, we are being told that the likelihood is that Mullah Mohammed Omar is likely, is still in Afghanistan, yet it seems also equally likely that a deal was made in which he escaped because we have not heard from him. What is your best judgment there?
FRIEDMAN: Well, in that particular case, there were supposed to be about 10,000 to 15,000 Taliban troops in Kandahar. They were being attacked by various opposition groups. Any opposition group that would have attacked Kandahar would have lost an enormous number of its force, and therefore stopped being as influential as they might want to be otherwise.
Nobody was going to spend their troops capturing Omar, so they gave him a pass. The United States didn't want to see that happen, but we don't have nearly as much influence over some of these groups as we'd like to have.
DOBBS: George, thanks very much for being with us. George Friedman, of STRATFOR.com. Thank you.
Coming up next, in a time when layoffs are prevalent, we have a bit of good news for you tonight. We'll take a look at one company that has kept a generous promise to its employees, made some years ago.
And then, state of the art aircraft, hundreds of bombs being dropped daily, thousands of troops outfitted, trained, and engaged. We'll take a look at the price tag of this war against terrorism in Afghanistan. Also, perspective and analysis on the progress of that war, next.
ANNOUNCER: Next, Lou speaks with CNN military analyst and retired U.S. Army General David Grange.
(COMMERCIAL BREAK)
DOBBS: Tonight in the war against terrorism, the Pentagon now says there's intense fighting in the mountainous region of Tora Bora. Al Qaeda fighters say they will now fight to the death, and they say they'll turn Eastern Alliance fighters to dust should they get too close.
Alliance fighters backed by U.S. air strikes say they've taken three more al Qaeda positions tonight and they are pushing the al Qaeda fighters to the Pakistani borders. We'll have more on the War against Terrorism in just a minute.
Joining us now, CNN military analyst, General David Grange. General, good to have you here.
RETIRED GENERAL DAVID GRANGE, CNN MILITARY ANALYST: Good evening, Lou. DOBBS: The fighting in Tora Bora obviously intensifying now that the Taliban and al Qaeda have allowed the second ultimatum to lapse. What is your sense of the progress there?
GRANGE: Well, you know I think that was just a time to stall. They're going to continue to pressure the Taliban up in the mountains. They are going to probably fight to the death.
The interesting thing is what their leaders are going to do. The leaders of al Qaeda, Mr. bin Laden and, of course, do as I say, not as I do Omar, down outside of Kandahar, leader of the Taliban. They're both very cowardly type leaders. They tell their soldiers to do certain things and then they obviously abandon them.
So something our military, our Western leadership style does nothing like this and if they did leave, like George Friedman said, and went into Pakistan, I would not doubt that.
DOBBS: It is obviously more of a cultural issue than a military question, but the idea of Osama bin Laden who is a hero to quite some number of people in that area, to abandon his troops like this even by the standards of their culture, it seems somewhat difficult that he could maintain any kind of leadership role.
GRANGE: You're absolutely right. I don't see how he can. This warrior culture that you're referring to, leaders fight with their soldiers, and of course it's hard to say whether he's really a soldier or not, but he is their leader and I think he lost a lot of support with this type of an attitude.
The other is, the tape that's released just showing his cruelty in taking lives also discredits him quite a bit, and I hope that our government and our allies exploit that tape with the disinformation that they normally put out. We put out the truth with information warfare, with his attitude. I think that will discredit him quite a bit.
DOBBS: You're talking about the warrior culture, simply the mujahedeen. It is that. The idea that a warrior culture, however, could produce a person like Osama bin Laden who would brag about the deaths of innocence. He's not exactly going face-to-face with his enemy, armed and with great bravery. How do you explain that?
GRANGE: Well it's, I think, individuals like Omar and bin Laden, they've tasted power. They enjoy the position they're in, in directing people to do things, to take lives. You know he laughed about, for instance on the tape, about some of his killers did not realize they were going to fly to their death in taking down the towers.
DOBBS: That was an extraordinary moment.
GRANGE: Yes, and I just don't - and he laughed about it, laughed about sending his people to death. You know, just the leadership. It's hard for me to imagine that. And so, you know he deserves to get whatever he gets and I hope that, you know, if we don't kill him that he is captured and we have some severe consequences of that tribunal.
DOBBS: You heard George Friedman talked about his judgment about where Osama bin Laden might be or not be. What is yours tonight, and also the whereabouts of Mullah Mohammed Omar?
GRANGE: Well, they could very well - bin Laden could very well be killed from air strikes. But due to some extensive searches that are going to have to happen, hopefully they'll find his body and other key lieutenants that may have died with him.
He could have slipped into Pakistan to continue the fight in the future. If that's the case, he'll still be caught, very similar to Jake Caveretit (ph) in South America; Escobar, the drug lord; Carlos, the terrorist of the '70s. Those guys -- they're caught. And it may take a while. And we shouldn't get hung up on the fact if we don't get him right away, because we truly have denied the sanctuary of Afghanistan and we surely have crushed the infrastructure of the al Qaeda.
But hopefully we'll get him. And you know, I'd love to see him sentenced and work at ground zero at that site removing debris for several months before his sentence is put into effect.
DOBBS: I think a number of Americans, people all around the world have a few thoughts about how best to punish Osama bin Laden. And I think that one sounds interesting indeed. David Grange, thank you very much.
GRANGE: Thank you, Lou.
DOBBS: General David Grange.
Well, 1,500 pound bombs, millions of pounds of ordnance, ships, aircraft carriers, B-1 bombers, helicopters, all fighting a war in Afghanistan. And fighting any war can be a costly enterprise. But for the world's only super power, the financial cost of the war so far has been certainly been relative. Surprisingly, the war has been cost-effective.
Kitty Pilgrim has the report.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): The pyrotechnics of the war, first seen on the green nightscopes, and then in clear daylight have been impressive. The cost, equally so. Operation Enduing Freedom is an inexpensive operation, estimated at less than $2.5 billion, by experts, $3.8 billion by the Department of Defense.
STEVIAN KOSIAK, CSBA: We spend about $350 billion a year on our military. So when we have to conduct an operation like this, it costs us a few more billion dollars to actually conduct the operation, but a lot of the costs have already been paid.
PILGRIM: Because no one knows exactly the scope of operations, the following are estimates, but informed ones. There are several dozen warships in the region, several thousand Army and Marine Corps troops. But ground troop costs were saved by using allies like the Northern Alliance to fight along with U.S. forces.
During the Gulf War's Desert Storm, there were about 35,000 strike sorties, costing $15 billion dollars. Operation Enduring Freedom, 4,700 flights, or $2 billion.
The distances in this conflict are a cost issue. The Navy's FA- 18 fighter bomber costs $5,000 dollars an hour to fly. It is 700 miles from the Arabian Sea, where the aircraft carriers are based, to Kabul, 2,500 miles from Diego Garcia in the Indian Ocean. The flying costs are estimated at $300 million for the first two months.
Add to that, the B-1 bomber lost in the Indian Ocean this week, $300 million. In this war, they broke out the big ticket firepower. The Navy is thought to have launched about 100 Tomahawk land attack cruise missiles, about $1 million a piece.
In Desert Storm, only about 7 to 10 percent of the munitions used were precision guided munitions or smart bombs. In Afghanistan, 60 percent were smart bombs. They are smart and expensive.
JIM PHILLIPS, HERITAGE FOUNDATION: The air war has been, I would say, extremely cost effective in the sense that there was very little collateral damage in terms of civilian casualties because of the very extensive use of smart bombs.
(END VIDEOTAPE)
PILGRIM (on camera): Now putting this in historical context, in World War II, we were spending about 40 percent of GDP on the military. Today, about three percent. And only a tiny fraction of that is going to the war in Afghanistan -- Lou.
DOBBS: Extraordinary, and without question a definition, another definition of what is superpower.
PILGRIM: It is. And it really seems very technologically based how cost-effective you could be these days.
DOBBS: OK, Kitty, thanks very much. Kitty Pilgrim.
Tonight, the American Red Cross once again at the center of controversy. The Food and Drug Administration is asking a federal judge to hold the Red Cross in contempt of court for violations in its blood collection program. The FDA says it found several violations, including incorrect labeling and the release of potentially contaminated blood.
The Red Cross supplies nearly half of country's blood supply. The Red Cross recently saw its chief executive officer, Bernadine Healy, resign after a flood of controversy over delays in distributing money to the victims and the families of victims of the September 11 attacks.
Coming up next here, we'll have the latest for you in the war against terror in Afghanistan. And while many companies are posting losses and laying off employees, we'll take a look at a firm succeeding and rewarding its employees. And we'll tell you about what turned to be a very rough session in Wall Street. We'll take a look at the markets in some detail next. Weighing on stock prices today, a record plunge in retail sales in the month of November. We'll take a look at the state of this economy and analyze just when recovery might begin next.
ANNOUNCER: Up next, Lou talks with the economist Lakshman Achuthan.
(COMMERCIAL BREAK)
DOBBS: In the war against terrorism, the Pentagon tonight says the battle in the Tora Bora region is fierce. And the Pentagon says the al Qaeda still does have a choice.
(BEGIN VIDEO CLIP)
DONALD RUMSFELD, DEFENSE SECRETARY: We're there to stop those people. And if they want to surrender, they can do it in one second. And they know it.
(END VIDEO CLIP)
DOBBS: The Eastern Alliance, meanwhile, says it's making progress pushing al Qaeda fighters in that region toward the border with Pakistan. At the same time, U.S. bombs continue to rain down on al Qaeda targets.
Zacarias Moussaoui, the only person charged in connection with the attacks on the World Trade Center and the Pentagon, appeared at a hearing in a Manhattan courtroom today. the 33-year-old was ordered transferred to Virginia, where he will stand trial on conspiracy charges for allegedly helping carry out the attacks that killed thousands of people at the World Trade Center.
In other news tonight, President Bush used executive privilege today, by refusing to release confidential Justice Department documents. Those documents related to campaign fund raising during the Clinton administration. President Bush says he believes it could be contrary to national interests to release those documents. And he instructed Attorney General John Ashcroft not to turn those documents over to Congress.
Stocks today moved lower, sharply lower on Wall Street, pressured by profit warnings from Lucent and Ciena. And more earnings warnings after the bell. The markets closing near session lows today. The Dow falling 128 points. The Nasdaq plunging 64 points. The S&P 500 down 17 points, at its lowest level in a month.
Christine Romans at the New York Exchange, Greg Clarkin at the Nasdaq marketsite.
We will begin with the correspondent covering the market where the least damage was done. That's you, Christine. CHRISTINE ROMANS, CNN CORRESPONDENT: You're right, Lou. Well, the least damage, down 128 points though. It's nothing to sneeze at over here at the big board. 22,000 job cuts announced this week alone. And those earnings warnings, particularly in the telecom sector, at plan when you look at the most active trading on the big board this day.
You look at Lucent down 14 percent on the session here today. It's going to lose more in the quarter than Wall Street had expected, a victim of that capital spending crunch.
Not even a solid IPO could get people excited here today. The insurance giant, Prudential Financial, raising $3 billion in the third biggest public offering this year. Meanwhile, Qwest cutting its growth outlook through 2002. Also cutting 7,000 jobs or 11 percent of its workforce. GE, flat on the day, Lou, but a lot of volume here, about 22 million shares. That's more than usual.
And Nortel, those warnings from Ciena and Lucent hurting the Canadian competitor of those two. That stock down in very active trade as well.
After the bell, we heard from Bristol-Myers. They are giving guidance for 2002 that is lower than Wall Street had expected. You know, these drug companies are facing generic competition. Many of them starting next year. (UNINTELLIGIBLE) is what's going on there.
DOBBS: Christine, I'm sorry to interrupt you, but we have a breaking news development. Thank you very much, Christine Romans.
There is word to CNN that Osama bin Laden apparently, apparently has been surrounded by forces in a cave near Tora Bora.
We're going to go to military affairs correspondent Jamie McIntyre now at the Pentagon who has the story -- Jamie.
MCINTYRE: Well, Lou, I don't want to overstate exactly what we know, but talking to a very senior military official here at the Pentagon, the best intelligence the United States has right now indicates that Osama bin Laden is, in fact, in a cave complex that is surrounded by opposition fighters, as well as U.S. special forces in the Tora Bora area.
Now this official admits it is possible that bin Laden could have slipped out at some point. But all the evidence right now indicates that he is in there with al Qaeda fighters, the ones who are essentially fighting for their lives in the battle of Tora Bora.
In addition, this senior official indicated to CNN, that the best intelligence on the whereabouts of Mullah Omar is in the -- is that he is in the Helmand province of Afghanistan, which is essentially slightly to the west of Kandahar. His last known location was in Kandahar.
And so, again, the best evidence that the United States has, in its best judgment, according to the senior official, is that both Omar and bin Laden are in Afghanistan and that Omar may be surrounded by opposition and U.S. forces -- Lou.
DOBBS: Jamie, I realize that it is early in the development of this report, but do we have any idea of what intelligence is suggesting the presence of Osama bin Laden there?
MCINTYRE: No. And this is, you know, the thing about the intelligence is all the Pentagon officials have said they have hundreds of separate reports that these people are in all different places. But they sift through these. They make a judgment.
And then the judgment of this very senior military official, they believe, the Pentagon believes, that the most likely scenario is that bin Laden is in his cave complex. Now it's entirely possible that when the battle is over and that they're either killed or forced to surrender those al Qaeda fighters, they'll find bin Laden is gone. But at this point, they believe he's in there.
DOBBS: Would you gauge this, Jamie, to be, if you will, the most optimistic statement by the military to this point on his whereabouts?
MCINTYRE: Well, yes, it's not a public statement, obviously. But this official admitted he was taking a somewhat optimistic view, but that is what the intelligence indicates. He said to me, "Wouldn't it be a great Christmas gift if we were to get him before Christmas?" So there's some optimism here, but it's also tempered by the realization that they don't really know for 100 percent where either of these guys are.
DOBBS: And the Pentagon has been, as you know, better than any of us constrained and extraordinarily careful throughout in its dealing with these issues, as have you.
Jamie, thank you very much for that report. Jamie McIntyre from the Pentagon.
Well, turning to the economy now, my next guest says that today's weak retail sales figures, and they're certainly that, weak, in fact a record decline in retail sales for the month of November. Those figures simply reinforce his view that it's premature to say that recovery is just around the corner.
We welcome back economist, regular MONEYLINE contributor, Lakshman Achuthan. Good to have you back.
LAKSHMAN ACHUTHAN, ECONOMIC CYCLE RESEARCH INSTITUTE: Hi, Lou.
DOBBS: Obviously, terrible news on retail sales for the month of November. Surprising in that, to me at least, were the sharp declines in automobile sales.
ACHUTHAN: Well, people bought a lot of cars the month before. Sales are a coincident indicator of the economy. So they're telling us we remain in recession, we haven't bottomed yet, things have continued to deteriorate. The leading indicators, not sales, the leading indicators of the economy have been edging up over the last...
DOBBS: The weekly indicator?
ACHUTHAN: The weekly leading index, in particular, that comes out every Friday in the mid-day. And that index has been edging up for a little over a month now.
DOBBS: So how do you square that with what apparently happened in November?
ACHUTHAN: Well, I think that because the weekly leading index, which leads sales, went down very sharply in advance of the recession. And now, we're looking to the weekly leading index to give us a sign of recovery in some time in the future.
DOBBS: Better news on jobless claims.
ACHUTHAN: That helps.
DOBBS: (UNINTELLIGIBLE) 84,000. We're back below 400,000. What does that suggest?
ACHUTHAN: It's a week. So we can't read too much into it, but it's a movement in the right direction. If we can get an extension of this one month uptick in the weekly leading indicators, extend it for another month or so, then we're looking at a recovery, some sort of recovery, in the early part of 2002. The next question will be what kind of recovery.
DOBBS: And as we look further, I want to go back to those November sales.
ACHUTHAN: Sure.
DOBBS: Without the automobile sales decline, which the month in which they were strong marketing, 0 percent financing, if you take automobile sales out of it, the decline would have only been half of 1 percent. That would have been pretty good?
ACHUTHAN: Pretty good. You know, the consumer has been surprising us during this entire recession. This recession has been business led. Businesses have been on hold. And the consumer, with the help with the Fed, has been surprising us with continued consumption.
DOBBS: And also with the help of the United States military, which is doing very well with the war against terrorism?
ACHUTHAN: Anything to help us with our confidence is a good thing. If we can stem the job losses, that's a better thing.
DOBBS: OK. Lakshman, I'm going to take that as an optimistic outlook on the economy.
ACHUTHAN: I'm hopeful. I'm hopeful.
DOBBS: I'll take that every time.
ACHUTHAN: OK.
DOBBS: Thanks.
ACHUTHAN: Thank you.
DOBBS: Just ahead here, a promise made and a promise kept. Many companies may be slashing bonuses, but we'll show you a firm with a very generous holiday gift. That story is next.
(COMMERCIAL BREAK)
DOBBS: In the midst of this holiday season, too often tainted with news of a slowing economy, more layoffs, disappointing earnings, stock price declines, even the collapse of entire businesses, we decided to travel to Philadelphia. There, we found a firm that not only met its goals, goals set some four years ago, but its management set an example for all businesses and kept its pledge to its employees, and last night, threw a very special holiday party.
(BEGIN VIDEOTAPE)
(voice-over): First Trust employees enjoyed a cocktail hour at their holiday party in anticipation of the big event, achievements awards to be presented. The suspense mounted and then...
UNIDENTIFIED MALE: So on behalf of the entire First Trust board of directors, as well as I'm myself, I'm very excited to announce that a 45 percent Super Bonus II will be paid.
(APPLAUSE)
DOBBS: Forty-five percent of every employees average pay over the past four years. A super bonus paid in addition to their annual bonuses. The extra money even prorated for employees who've worked there for less than four years.
MARTY PHILLIPS: Today's economy, and what you read in the paper, it's a surprise.
THERESA RZULAK: I've worked for other institutions, other banks, 22 years, and I have never worked for a place like this, ever.
DOBBS: That loyalty was the CEO's goal.
UNIDENTIFIED MALE: We've been fortunate enough to do well. And we know that attracting, retaining, motivating great people is really the key determinant to our success. And that's what we want. That's who we want to reward.
DOBBS: As First Trust employees celebrated, conversation turned to spending plans. From the practical.
JIM DUBIO, EMPLOYEE: I have two kids. I have twins going to college next year. So I'm going to need the money for that.
DOBBS: To a special vacation. BRIAN SETNICK, EMPLOYEE: Is it's a trip to Disneyland for my wife and two children. So that's very nice in this time. So we're thrilled.
(END VIDEOTAPE)
DOBBS (on camera): The First Trust Christmas party went late into the night, as the staff celebrated their achievements. A promise kept and the spirit of this holiday season.
Well, back to our breaking news story. Now a senior military official tells CNN tonight that the United States has reason to believe that Osama bin Laden is surrounded by opposition forces and U.S. forces in a cave complex near Tora Bora. This official says that the best intelligence that U.S. officials have been able to glean indicates the Taliban leader Mullah Mohammed Omar is in Helmand province, located to the west of Kandahar, where he was last seen.
(PREVIEW "WOLF BLITZER REPORTS")
DOBBS: And coming up next here, we'll take a look at your thoughts and we'll tell you some of what could make news tomorrow.
(COMMERCIAL BREAK)
DOBBS: Tomorrow, the consumer price index and industrial production reports, both for the month of November, will be released. 12 days after Enron submitted the largest bankruptcy filing ever, Enron will be back in bankruptcy court tomorrow.
Now taking a look at your thoughts. Joel and Victoria write in to say, "The deal maker," they're referring to Donald Trump, "refused to pay the interest on Atlantic City bonds, as well as other Atlantic City debt. Why didn't you report this matter?"
Well, the fact is, Donald Trump didn't default on that debt. After some delay, he did delay, he paid about $90 million dollars in interest payments due on his Atlantic City properties. He didn't leave bond holders high and dry as some have. Standard and Poor's has just released a report showing companies defaulted on a record $107 billion of debt this year, with default rates soaring to a 10-year high.
But there's no doubt that Trump's fortunes have fallen on hard times. The equity value of his New Jersey casinos, albeit a small fraction of his total worth, has been virtually wiped out. The stock price of Trump Hotels & Casino Resorts, of which he owns 42 percent, has slipped steadily over the past five years, trading tonight at around $1 a share. But don't feel too bad for the Donald. He paid himself more than $3 million last year for running the Atlantic City operation. And that's a part-time job.
Send us your thoughts, please, at moneyline@cnn.com. We love to hear from you. Please include your name and address.
Now back to our breaking news story. A senior military official telling CNN tonight that the United States believes Osama bin Laden is surrounded by opposition fighters and U.S. forces in a cave complex near Tora Bora. This official says the best intelligence that U.S. officials have indicates that Taliban leader Mullah Mohammed Omar is now in Helmand province, to the west of Kandahar, where Omar was last seen.
Well, finally tonight, a photograph on the front page of "The New York Times" today piqued our interest. And we thought we might share it with you tonight. This photograph shows U.S. troops on the move in the former Taliban stronghold of Kandahar, riding in the back of pickup trucks. And on the back of those pickups, transporting the troops, bumper stickers that I love a lot. Those bumper stickers read "I love New York." And you got to love the military who decided to put them there. New Yorkers certainly like the idea.
That's MONEYLINE for this Thursday evening. Thanks for being with us. I'm Lou Dobbs. Good night from New York.
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