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Lou Dobbs Moneyline
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Aired January 09, 2002 - 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 Wednesday, January 9. Here now, Lou Dobbs.
LOU DOBBS, CNN ANCHOR: Good evening. A marine refueling aircraft carrying seven Marines crashed into a mountainside in western Pakistan today. There are no reports of any survivors. The Pentagon says the KC-130 plane was preparing to land at a forward operating base at Shamsi when it went down. Pentagon officials say they have no information suggesting the aircraft was brought down by enemy fire. But the Pentagon says that has not been entirely ruled out.
Witnesses say the aircraft appeared to be on fire when it crashed. Officials say U.S. and Pakistani military vehicles raced to the scene of the crash soon after the accident. For the latest on the crash as well as the search and rescue operation, Tom Mintier reports from Islamabad -- Tom.
TOM MINTIER, CNN CORRESPONDENT: Lou, it's the middle of the night here in Pakistan. This crash occurred well after sundown in the dark along the Afghanistan/Pakistan border between two air bases that Pakistan has allowed the U.S. military to use to support its operations in Afghanistan. After the September 11 attacks, Pakistan agreed to allow the U.S. military to operate here, providing logistical support, providing airspace use and also intelligence gathering from the Pakistani intelligence services was provided to the United States.
This crash of the KC-130 with seven U.S. Marines onboard is the first major aircraft accident that they've had here. Pakistani authorities, within the hour after this accident happened, confirmed that it indeed happened, which was rather quickly. The rescue teams may have some difficulty getting to the site. It supposedly crashed in a mountainous areas that has peaks around 10,000 feet. So it may be daylight before we really know the beginning of the investigation and whether indeed anyone survived the crash. But at first look, it doesn't appear that any of the seven Marines aboard the KC-130 did survive -- Lou.
DOBBS: Tom, thank you very much -- Tom Mintier.
Well this war against terrorism is unique in many aspects, unique because we have no idea just how many Taliban and al Qaeda have been killed in the conflict nor how many have escaped capture altogether. Confounding and confusing as the numbers can be, no one seems to know what has happened to many some of the Taliban and al Qaeda prisoners captured by Afghan and U.S. forces. Estimates on the number of those vary widely.
And now, we learn that 48 hours after their surrender in Kandahar, seven top Taliban leaders were allowed to go free. Among the seven released were three senior Taliban ministers and the Taliban security chief for the city of Herat. The Pentagon, for its part, say it doesn't know what happened, but would still like to question them wherever they might be.
Well, the United States does know the location of more than 360 prisoners, most of them being held under extremely tight security in Kandahar. For more on that part of the story, we're joined by Lisa Weaver from Kabul.
LISA WEAVER, CNN CORRESPONDENT: Good morning, Lou. The several high ranking members of the former Taliban regime surrendered themselves in the southern Afghanistan city of Kandahar. They were subsequently released. Kandahar officials say allowed to go home, but in fact, their exact whereabouts at the moments are not exactly clear.
Now those Taliban officials of the ousted Taliban regime include Nooruddin Turabi, the former minister of justice credited with some of the most hard-line regimes of the Taliban, particularly in policies toward women. Also, Mullah Ubaidullah (ph), the former Taliban frontline commander as well as Abdul Haq. He is a former security chief in the northern Afghanistan city of Herat. There were other officials among them.
Now Kandahar officials are saying that the men were allowed to go because they had agreed to lay down their arms and to recognize the interim government here in Kabul. Notably, the Taliban former leaders were not turned over to U.S. officials, much to their disappointment. This may mark a difference in priority between Afghan officials here and U.S. officials who would have very much liked to see these men turned over to him. Now despite the confidence in Kandahar in releasing these men, it was not so clear here in the capital among officials here that letting them go was the right thing to do.
(BEGIN VIDEO CLIP)
OMAR SAMAD, AFGHAN FOREIGN MINISTRY: We need to make sure that the people who surrendered are high enough or were high enough in the Taliban hierarchy to be considered as war criminals or associate -- terrorist associates. If that is the case, then and if it's proven to be the case, then the interim administration will need to look further into this issue to see if there was, as I mentioned earlier, if it was handled properly.
(END VIDEO CLIP)
WEAVER: Now also in Kandahar, U.S. forces are waiting to fly out 368 members of the al Qaeda network and Taliban members. They will be flying from Kandahar to Cuba to Guantanamo Bay, where they will surely undergo some very serious questioning there. We understand the men will likely be flown out in batches of between 15 and 20 men per flight. They will be in enclosed units inside the airplane for security. We understand there may be dogs put on the plane to keep them in control. We are also hearing U.S. officials are considering sedating these men with Valium or some other sort of sedative. U.S. officials taking very seriously the possibility that they may form a security threat -- Lou.
DOBBS: Lisa, thank you very much. Lisa Weaver from Kabul.
Well, we're joined now for some analysis of these latest developments in the war against terrorism -- retired general, CNN military analyst, David Grange. General, good to have you with us.
RETIRED GENERAL DAVID GRANGE, CNN MILITARY ANALYST: Good evening, Lou.
DOBBS: General, let's start with the Pentagon, obviously wanting to talk with these seven officials, certainly four of them high- ranking Taliban officials. The local officials in Kandahar effectively thumbed their nose at the U.S. military and said, we're going to do what we want. What's your reaction?
GRANGE: Lou, I believe that it's -- just shows the lack of control throughout Afghanistan by the new government. I believe their intentions were sincere in supporting us to the extent that they can, to keep their new government together. But, you're dealing with local warlords that do their own thing like Kahn (ph) up north by Herat, people around Kandahar and elsewhere, Mazar-e Sharif. They are not going to follow orders, per se. They are going to do what they want to do and you have a lot of deals being made and you have people being released that we don't want released.
You know, this alliance, this coalition with the Northern Alliance that we started with, was a means to our end, which was to destroy the al Qaeda and the hardcore Taliban that supported them. And now that we're continuing to want to use them to help us do this, but their civil war has come to an end. And they now want to get on with their government and get along with the other tribes. And so some of the goals don't coincide. But I think these guys are still on the list and I think they still will be pursued and captured eventually.
DOBBS: You know, we also hear some talk -- and, General, I appreciate what you're saying -- but we knew that these were warlords intending to maintain autonomy long before this. We're also hearing some troubling reports that there aren't enough CIA agents, enough special operations people to maintain any kind of vigilance amongst these warlords. Is that a concern that perhaps there should be a remedy for?
GRANGE: Well, it's a point to be considered. The -- I'm sure they're stretched thin. You know, the agents for the Central Intelligence Agency were not that robust when this thing started because they were taken down years ago in size and effectiveness and it took a while probably to build it back up to what we have today. And I'm sure that's going to be continued to be built so we can take on this war on terrorism.
The special operations forces, again, are stretched very thin. But they tried to persuade the warlords, as an example, to do what we would like them to do, and sometimes they don't follow our desires or they do it behind our back. And so that's just what happens when you're dealing with ambiguous situations in an uncertain environment like Afghanistan.
DOBBS: Well, amongst those prisoners who are remaining in custody, some 360 of them who will be shipped to Guantanamo Bay in Cuba, what is the benefit of doing that?
GRANGE: Well, one thing, Lou, you have -- and enjoy knowing that they have a long haul. And I think they're going to have a long stay. What I've read and watched on the reporting, what's being built at Guantanamo Bay is a long-term facility. And so I think that these terrorists or terrorist supporters are going to be there for a long time.
Second, it's so remote from the theater of operations in Afghanistan that even if we had demands to release any of these people, it would take a while just with the distance to do that. So we kind of have them where we want, out of the way of the war, out of the United States. We have a chance to really get through the interrogations, put pieces together and also add more to that compound to continue to develop the picture for future fighting.
DOBBS: OK. General, thank you very much for being here -- General David Grange.
GRANGE: Thank you, Lou.
DOBBS: Well, troubling new information tonight. Authorities tell CNN that a prescription for Accutane, an acne medication, was made out to Charles Bishop. It was found in his home. Toxicology tests are now expected to determine whether he was taking that acne medication. Medical correspondent Rhonda Rowland joins me now to talk about this controversial drug -- Rhonda.
RHONDA ROWLAND, CNN MEDICAL CORRESPONDENT: Well, Lou, this drug does a checkered past for a long time. It's been known that Accutane can lead to birth defects. So that has been one well known complication.
But in addition to that, in recent years, there have been questions about psychological side effects. But there has not been a cause and effect relationship established between this. That is, there is no scientific evidence that if someone takes Accutane, that it will lead to depression or suicidal thoughts.
But since 1982, 140 reports worldwide of people committing suicide have been reported to the FDA and these victims have also been taking Accutane. Now during that time, more than 12 million people worldwide have actually taken the drug. And it's also important to know that a lot of people who use Accutane are adolescents. And this group is already at high risk for suicide. But given the reports, the drugmaker, Hoffman-La Roche, says they cannot ignore the reports. And for that reason, Accutane is one of the few drugs where patients are required to read and sign an informed consent document. And in this document, they must agree to taking the drug if they have feelings of worthlessness or inappropriate guilt or if they start having thoughts about hurting themselves or taking their own life, that is suicidal thoughts.
And because there have been questions about these psychological effects, the drugmaker Hoffman-La Roche is going to conduct a study and they are now in discussions with the FDA to get final approval on that. And once that study begins, they should have some answers within a year. In addition to that, there is already a study underway that is being paid for by private funds looking at the same question -- Lou.
DOBBS: If I may, the fact that people sign these documents, disclosure documents, is there any follow-up on the part of the doctor or the prescribing authority?
ROWLAND: Well, one would hope that if someone is taking this drug, they would be seeing their doctor on a regular basis so that the doctor could ask them questions about these particular side effects. And certainly, if it's an adolescent, that the parents would also be aware of these possible side effects so they could keep a watch. But this is a drug where it is prescribed every month. So, certainly it is one where people would be followed more closely than perhaps for some other drugs.
DOBBS: OK. Rhonda Rowland, thank you very much.
Well, on Wall Street today, a day-long rally evaporated and then reversed course in the final hour of trading. Stocks reversing themselves after enjoying solid gains driven by technology issues principally. The Dow had been up more than 120 points before retreating and finishing down 56 points on the day. The Nasdaq, which had been up more than 40 points, fell 10 points at the close, and the S&P dropping 5.57.
Coming up next here, protecting our food supply against terrorist attacks. The federal government is now making that a priority. We'll have the story for you. The Bush administration is working hard, trying to defuse rising tensions between India and Pakistan to prevent the threat of war. We'll discuss the latest developments with a global intelligence expert next.
ANNOUNCER: After the break, Lou speaks with George Friedman, founder and chairman of STRATFOR.com.
(COMMERCIAL BREAK)
DOBBS: The ongoing tension between India and Pakistan concern China as well. China has a long-standing border dispute with India and supports Pakistan militarily, and tonight, finds that it must walk a very fine line urging restraint.
Kitty Pilgrim now takes a look at China's role in the region and what's at stake for China.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): The official word from China to Pakistan is restraint. China has come out against terrorism, yet China has to find a delicate balance between its traditional ally, Pakistan, and a nuclear power and geopolitical rival to its south, India.
ROBERT HATHAWAY, WILSON CENTER: China is clearly playing both sides of the street. They want to retain their very close and warm relationship with Pakistan. And yet at the same time, they don't want to jeopardize a thawing relationship with India. Moreover, they don't want to be caught on the wrong side in the war against terrorism.
PILGRIM: Both India and Pakistan claim Kashmir. One part is controlled by Pakistan, another by India, and yet another claimed by India but controlled by China. Both India and Pakistan have massed hundreds of thousands of troops in the region. The military buildup came after a deadly assault on India's parliament on December 13 by suspected Muslim terrorists, terrorists India says were tied to Pakistan.
The military standoff is potentially explosive. Russia, China and the United States have strenuously urged calm. Yet reports persist China has stepped up shipments of military supplies and aircraft to Pakistan in recent weeks. Elizabeth Economy is the senior fellow for China at the Council on Foreign Relations, and says despite that, China is not looking to start a war.
ELIZABETH ECONOMY, COUNCIL ON FOREIGN RELATIONS: It has been a strong ally of Pakistan. It has a strong military relationship with Pakistan. In fact, there were reports that China recently had shipped military aircraft after the December 13 attack on India to Pakistan. But I don't think that China is interested in becoming engaged in a war.
(END VIDEOTAPE)
PILGRIM (on camera): Now China is saying that premier Zhu Ronghi will soon visit India to help relax tensions. And there are also reports that China is quietly lining up its own defenses along the southern border should any conflict spill over into China. All in all, a very tense situation, Lou.
DOBBS: OK. Kitty, thank you very much.
Well, for more now on the situation between India and Pakistan, we are joined by global intelligence expert George Friedman. He is the founder and chairman of STRATFOR.com. Good to have you with us, George.
GEORGE FRIEDMAN, STRATFOR.COM: Good to be here.
DOBBS: As Kitty Pilgrim has reported, the stakes are rather large for obviously every nation in the region. Give us your best judgment about China's role and direction here.
FRIEDMAN: Well, China obviously doesn't want to get very deeply involved. It's got much more important issues. And it's got an Islamic problem of its own in the western provinces. At the same time, it's watching the United States develop an awful lot of power to its southern flank, especially in India. And that has got to make it very uneasy. Remember, just before this crisis broke, the United States was reorienting its defense policy towards the Pacific, towards China after the incident on Hainan Island. So we've got a situation here that China doesn't quite know what to do about and isn't very happy about either.
DOBBS: And India, a nation of a billion people, to China's 1.2 billion, an extraordinary missile program and space program as well, advanced militarily. What do you think will be the role bilaterally, that is between India and the United States in the years ahead?
FRIEDMAN: Well, even before this crisis of September 11 started, the U.S. and the Indians were warming up their relationship. Right now, the United States is using the Indians, simply. The Pakistanis clearly have a lot of intelligence about al Qaeda. And many of the al Qaeda's members and Taliban members are in Pakistan now.
On the one hand, we don't want to break in relations with Pakistan. On the other hand, we do want the Pakistanis to cooperate with us. We're playing a very delicate "good cop, bad cop" game with the Indians. In the long run, we're hoping to have a very strong relationship with India. We see our relations with China as moderate to poor, given the track record. And India becomes important.
DOBBS: George, I hate to interrupt you, but we're going to go to the president. President Bush tonight will be attending and is, as you see, attending his first political fundraiser since the September 11 terrorist attacks. The President, by the way, stands at that podium at the Capitol Hilton supporting his brother, Governor Jeb Bush running for re-election, of course, in Florida. And we join him now.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Thank you all very much.
First, it's good to be at the old family reunion.
(LAUGHTER)
I want to thank Marv and Doro for hosting this reception for our brother, my big little brother.
I want to thank the chairman and the vice chairman of the Republican Party for being here. I want to thank the chairman of the Florida party. I want to thank Al Cardenas. And I want to thank you all for coming.
These are serious times that face our nation, and these serious times require serious leaders, and you're here to support a really good, serious man.
(APPLAUSE)
I was reminded about how serious the times are today when we lost a KC-135 refueler in Afghanistan. Our hearts and prayers go out to the families of the soldiers.
BUSH: But I want to remind them that the cause that we are now engaged in is just and noble. The cause is freedom. And this nation...
(APPLAUSE)
And this nation will not rest until we've achieved our objectives.
(APPLAUSE)
I have explained to the American people that we must be patient. And I'm proud to report the Americans are patient; that we are entering into a dangerous phase in our war against terror; that we've achieved a lot of objectives thanks to a fabulous military; that we have rooted out the government that was the host to the parasitical Al Qaeda.
And in so doing, this great nation liberated women and children from one of the most repressive, evil regimes history has ever known.
(APPLAUSE)
My favorite scenes of this conflict have been the joy on the faces of Afghan women as our soldiers and our allies have swept into these villages, where women were so incredibly repressed. Where the -- it's just hard for our country to imagine the brutality and the backwardness of the Taliban.
BUSH: They are no longer in power, thanks to the great United States of America.
(APPLAUSE)
Those who struck America think they can run and hide. It's interesting: I find it amazing that the Al Qaeda leaders are more than willing to convince some of their brethren to commit suicide, yet they themselves hide in caves.
(LAUGHTER)
And that's why this phase of the war is dangerous, because we're going to hunt them down. They think they can hide, but this patient nation will do whatever it takes to bring them to justice, and when we do, the world will be better for it.
(APPLAUSE)
We have got a job to do here at home, and I appreciate working with Governor Bush on protecting our homeland. We've got a job to make sure that we take every threat seriously. And make no mistake about it, the enemy still wants to harm America. But what they don't realize is that this nation is alert, and we're ready, and anytime we find any hint of anybody who'll try to harm the innocents of our country, we will give them a chance to share information with us.
(LAUGHTER)
We will bring them to justice as well.
But the best homeland defense, of course, is to be successful overseas. We're in the first theater. But wherever terror exists, this great nation will hunt it down.
BUSH: It's the calling of our time.
(APPLAUSE)
I appreciate so very much the spirit of unity here in Washington, D.C., on this war.
(LAUGHTER)
But we showed what's possible in Washington -- what can happen in Washington the last couple of days. I had the honor of travelling our country with George Miller of California, John Boehner of Ohio, Judd Gregg of New Hampshire and Senator Ted Kennedy of Massachusetts.
I signed an education bill that is a really good piece of legislation. It's a good piece of legislation because it enables and empowers governors like Jeb Bush of Florida to continue to strive for excellence for every child. And it's a good piece of legislation because it shows what's possible in Washington, D.C.
Political parties are important, but they're not nearly as important as doing the nation's business. And making sure every child is educated is a heck of a lot more important than the political parties that make up our political system.
(APPLAUSE)
I've worked hard to change the tone in Washington, to focus on big matters and to bring people together to achieve those matters. I hope that one of the legacies of my administration will be that results matter more than rhetoric, and that as we achieve results, it's important to share credit with people.
I jested with Ted Kennedy when I told him that the folks in the coffee shop in Crawford, Texas, will be amazed when they see me standing up there saying nice things about him.
(LAUGHTER)
But I meant them. I meant them, because this bill never would have happened had he not made up his mind to help it happen. BUSH: And that's exactly the spirit that Jeb has taken to the governorship of Florida. You see, he, too, is a proud Republican, like me, but he also understands children of Florida are more important than political parties.
And he said he stole ideas from me. He didn't steal ideas from me. He had the idea of every child being educated ingrained deeply in his heart.
Today I signed an Everglades agreement with the state of Florida, legislation that passed prior to my time. My job then was to certify that the Floridians were honoring their obligation to make sure there was enough water to the Everglades park. That was easy to sign, because I know that deeply ingrained in Jeb's heart is the desire to protect the natural beauty of the state of Florida.
He's a deeply compassionate man, but he's plenty tough. Just ask the crooks of Florida.
(LAUGHTER)
(APPLAUSE)
I want to thank you all for making his campaign more viable. But what's going to make it really viable is that he is a man who's done in office what he said he would do.
He speaks straight with the Florida voters. He tells them what he believes. He's not one of these kind of fellows that walks around with his finger in the sea breeze trying to figure out which way the political winds blow. He says what's on his mind, not based upon polls or focus groups, but based upon conviction. And there's no doubt in my mind that he is not only one of the great governors of Florida's history, he's one of the great governors of our nation, and he deserves a second term.
(APPLAUSE)
DOBBS: President Bush speaking at his first fundraiser since the September 11th attacks. That fundraiser is obvious by the President's words, in support of his brother, Governor Jeb Bush of Florida. And, again this is the first appearance at a fundraiser since September 11.
Let's turn now to the latest developments in the war against terrorism. A U.S. military refueling plane, carrying seven marines, crashed in a mountainside in western Afghanistan. The President in his earlier remarks extending his sympathy to the families of those crew members. There are no reports of survivors.
The Pentagon saying that there was no indication of enemy fire, but the Pentagon says it has not been ruled out altogether at this point. And U.S. forces in Kandahar are waiting to hear when al Qaeda and Taliban troops will be flown to the U.S. Naval base at Guantanamo Bay, Cuba. Those prisoners are considered to be so dangerous that the Pentagon is considering a plan to sedate them with Valium. A former California nuclear power plant worker is in jail tonight, that after he allegedly threatened to kill people at the San Onofre nuclear power station. Authorities found more than 250 weapons, more than 4,000 rounds of ammunition in the man's home and at his storage facility. The man was fired from the plant in December.
The Justice Department tonight is defending its plan to track down more than 6,000 people of Middle Eastern and Arab descent who are in the country illegally, and to deport them. The Federal Government is being accused by some of racial profiling, but the Justice Department says it's a critical part of its fight against terrorism. Susan Candiotti joins us now and has more on the story. Susan.
SUSAN CANDIOTTI, CNN CORRESPONDENT: Hello, Lou. The Justice Department says it is right to go after thousands of Middle Eastern and other Arabs already under deportation orders. The government says it's using every legal means it has to protect Americans from terrorist attacks.
Of 314,000 deportable aliens, 6,000 fit the government's profile. In a statement, the Justice Department adds this: "We will continue to focus investigative intelligence gathering and enforcement operations on individuals in the U.S. from countries with highly active al Qaeda networks to protect Americans."
Targeting some ethnic groups makes sense, according to some former Justice Department officials.
(BEGIN VIDEO CLIP)
GEORGE TERWILLIGER, FORMER DEPUTY ASSISTANT ATTORNEY GENERAL: That doesn't mean that every Arab is a - or every person even of Middle Eastern background is a terrorist obviously. But that's the community of people that you would look for first for suspicious activity, and that's just a harsh reality of what we are dealing with.
(END VIDEO CLIP)
CANDIOTTI: Others call the effort ethnic profiling that casts too narrow a net.
(BEGIN VIDEO CLIP)
WADE HENDERSON, LEADERSHIP CONFERENCE ON CIVIL RIGHTS: We certainly believe the immigration service has a responsibility to enforce the law. But the idea of focusing on 6,000 Arab surnamed men, primarily from the Middle East, has a way of thwarting terrorism, from my perspective is not only inefficient, but it also raises some very troubling civil rights concerns.
(END VIDEO CLIP)
CANDIOTTI: But would these new steps just revealed by the Justice Department have headed off the attacks of September 11? All 19 hijackers entered the country legally, and only three overstayed their visas. None of them faced deportation orders when those terrorists struck. Lou.
DOBBS: Susan, thank you very much. Susan Candiotti from Washington. Just ahead here tonight, the government is taking new steps, trying to protect the national food supply against terrorist attacks. We'll have that story for you when we continue. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Well since September 11, fears have risen about the safety of the nation's food supply. It's extraordinarily vulnerable. The Food and Drug Administration today issued new guidelines, trying to protect our national food supply, shifting resources to better identify and to cope with threats to the food supply. Casey Wian has the report.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT (voice over): Farmers, food processors, and retailers all say the United States food supply is the world's safest, but it's not safe enough to stop a terrorist from contaminating at least some of what Americans eat.
So the Food and Drug Administration is issuing a sweeping set of voluntary guidelines to encourage food safety, from the farm to the fork.
JOE LEVITT, FDA FOOD SAFETY DIRECTOR: In light of September 11, we have to take one more step. We have to increase our vigilance and look at that same system through a new lens, through the lens of possible intentional contamination of food, and that's what these guidelines are designed to do.
WIAN: Guidelines include criminal background checks for job applicants, watching for employees who linger after their shift, and installing fences, surveillance equipment and other security devices at farms and restaurants.
In all, more than 100 recommendations developed with the help of the food industry, but without the usual input from the public. The FDA and the food industry dispute claims by some consumer advocates that the voluntary guidelines will be ineffective.
RHONDA APPLEBAUM, NATIONAL FOOD PROCESSORS ASSOCIATION: Knowing what you need to do is much better than giving a command and control requirement in terms of you must have this. The companies vary. There are a variety of company sizes, a variety of company resources out there, and we leave it up to the companies then to determine how they're going to get from Point A to Point B.
WIAN: The food industry says it's too early to determine the costs of complying with the FDA guidelines. Food producers, importers, and sellers say insuring food safety is in their own interest.
JOE MILLER, AMERICAN FARM BUREAU: I do think the industry itself does want to take care of a lot of these problems. So I think suggested guidelines with voluntary enforcement will actually be fairly safe.
(END VIDEOTAPE)
WIAN (on camera): But fairly safe may not be enough to prevent a terrorist attack on the nation's food supply, so Congress has appropriated money to pay for an additional 600 FDA inspectors across the country -- Lou.
DOBBS: Casey, that is, as you put it, a step forward but the nation's farmers are going through very difficult times. The expense that is implied here is enormous. What is the next stage there?
WIAN: Well, it's unclear how many of the farmers will actually comply with these guidelines. The FDA is leaving it up to individual types of businesses to decide which of the guidelines they can pick and choose from. Some of the farmers are big and can afford it. Some of them are small and can't. So the FDA is leaving it up to businesses to improve with a strong suggestion with these guidelines.
DOBBS: Casey, thank you very much. Casey Wian reporting from Los Angeles. The President tonight, as we reported to you and brought his comments to you at least in part, speaking at his first political fundraiser since the attacks of September 11. The President lending support to his younger brother, Governor Jeb Bush, and Senior White House Correspondent John King joins us now from the White House -- John.
JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: Lou, and as he did that, you can't blame a guy for helping out his brother. You can't blame a Republican President for helping Republican candidates.
But I think what was most remarkable about this event tonight, you also heard the President in a partisan political setting praising the Democrats. He praised them for their support on the warfront. He praised them for their support in the bipartisan education legislation he signed into law yesterday.
A lot of attention on this event. It was originally scheduled for November, rescheduled because of the September 11 attacks. The President did not want to be involved in partisan politics so soon.
It will be interesting to watch how this President tries to translate his popularity into help for Republican candidates this year, including his brother without breaking, if you will, the agreement to try to keep things bipartisan, at least when it comes to the war.
This is the first time we got to see that from the President tonight, and very odd to see the Republican President praising the Democrats at a Republican fundraiser -- Lou.
DOBBS: Yes, he kept talking about the people at the coffee shop in Crawford, Texas being surprised. I think it went a little further around the country than that. John, thanks very much. John King from the White House.
Just ahead, we'll have the latest for you in the War against Terrorism, including possible reasons why a Marine Corps refueling aircraft with its seven crew members aboard crashed today.
We'll be telling you also about a reversal of fortune in the Stock Market. And also we will talk about the prospects of recovery. One leading economist believes the prospects are brightening. We'll have that story for you as well, and that leading economist next.
ANNOUNCER: Next, Lou speaks with Lakshman Achuthan of the Economic Cycle Research Institute.
(COMMERCIAL BREAK)
ANNOUNCER: LOU DOBBS MONEYLINE continues. Here again, Lou Dobbs.
DOBBS: A U. S. military refueling aircraft carrying seven marines crashed in western Pakistan today. The Pentagon says there are no initial reports of survivors. There is no indication that the aircraft was brought down by enemy fire, but that possibility has not been fully ruled out.
The United States military could remain in Central Asia for years. The New York Times today reporting the United States and its allies are building a base in Kurgistan, a former neighboring Soviet Republic. Engineers are also improving runways and housing at bases in Uzbekistan and Pakistan as well.
A U.S. District Court Judge says she will not rule on whether to televise the trial of Zacarias Moussaoui before next Tuesday. Moussaoui's attorney, along with several television networks, have argued in favor of televising his trial. Moussaoui is the first man to be charged in connection with the September 11 terrorist attacks.
Two Palestinian gunmen killed an Israeli officer and three Israeli soldiers before killing themselves today. The radical Islamic group Hamas claimed responsibility for those attacks near the border where Israel, Gaza, and Egypt converge. The Palestinian Authority immediately condemned the attack.
A solid rally today on Wall Street. It evaporated. The Dow closing down 56 points, the Nasdaq falling 10 points and the S&P 500 down 5.57. Christine Romans at the New York Exchange, Greg Clarkin at the Nasdaq marketsite to update us. Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: Well, Lou, the long-term investors continue to put money into this market for 2002, but the short-term investors when they saw how far we've come they started to get nervous and profit taking came into this market late in the day unraveling those gains. In fact, giving us a red arrow for the Dow and the S&P on the day.
Take a look at the Big Board movers here though, some interesting stock market action. Merrill Lynch up nicely, the highest since early July for this one. It announced big job cuts to improve profitability. It's going to take a $2.2 billion charge, in part to pay for the cost of more than 9,000 job cuts.
Homebuilders on fire today. Lennar, up very nicely after reporting that earnings rose 50 percent in the quarter. We saw a brisk demand for homes because of low mortgage rates, higher sales in Florida, Texas, California.
Halliburton up nicely as well, less concerned investors today about possible asbestos liability.
Wal-Mart meanwhile dragging down the Dow. This is an evaluation story, analysts coming out today and saying this is one of those stocks that's hit all the targets that people were looking for. It's pricing in a recovery in 2002, might be time to sell it.
And Gateway, down 98 cents, that's another 12 percent, Lou. You heard us tell you last night that Moody's had cut its rating to junk status. Investors definitely taking that one off the table today -- Lou.
DOBBS: And for the broader market, perhaps it's reassuring to everyone that we're starting to hear a little talk about something called profit taking. Profit taking is back.
ROMANS: Profit taking is back.
DOBBS: Christine, thanks. Christine Romans. Let's turn to Greg Clarkin now at the Nasdaq Market Site, which erased more than half of its gains yesterday -- Greg.
GREG CLARKIN, CNN CORRESPONDENT: Yes, Lou, I'll tell you they really bailed out on the tech stocks late in the trading session, about the last hour of trading or so.
And one trader I spoke with said, you know, if you consider that at the highs today, the Nasdaq was up around 2,100, that was about a seven and a half percent gain over the last six sessions basically year to date. They said, you know, there was really nothing to support that kind of run. He likened it to a rubber band just stretching.
So we did see that profit taking come in. It drove down most technology sectors. One group that was able to remain strong though were the software stocks. You had a big European software company coming out with some positive things to say, BEAS there, and then also Oracle's CFO saying that business is holding steady. That gave that group a nice pop. Oracle up almost a buck on the day.
Rational Software was upgraded out of S.G. Callen. That stock rose. Siebel Systems and BEA Systems also with better than dollar gains. So the software stocks stayed strong. Everything else pretty much crumbled in the late going, especially the chips and the networking stocks, and the Nasdaq again, losing about 10 points at 2,044 -- Lou. DOBBS: Greg, thanks. Greg Clarkin. Well my guest tonight is bullish on the economy, bullish on the markets. He's expecting a recovery in the near future, and he says stocks have hit their lows. Lakshman Achuthan, economist and MONEYLINE regular joins us now.
LAKSHMAN ACHUTHAN, ECONOMIC CYCLE RESEARCH INSTITUTE: Good evening.
DOBBS: Good evening and bring on the good news.
ACHUTHAN: Well, very specifically (UNINTELLIGIBLE) array of leading indexes have been moving closer and closer to signaling a recovery, a cyclical upturn in the economy.
DOBBS: Now the last time you and I talked, there had been seven weeks of upticks in the weekly indicators. You were looking for ten. Where are we?
ACHUTHAN: We got to nine and then we took a slip, but you know it never goes in a straight line.
DOBBS: Do we start all over again?
ACHUTHAN: No, we don't. Not at all. I think that you're allowed to have a little bit of noise. I think that this is a bonafide cyclical recovery in the leading indexes. We're rather conservative in making our calls. We won't come out and pound the table on a recovery until we see the monthly indicators, which we'll get in about a week or so.
DOBBS: Are you ready to pound?
ACHUTHAN: We're getting close, starting to tap.
DOBBS: OK, well we'll take a tap. Put this in definitive terms for our viewers, many of whom are investors, and obviously very interested in the result here. We have seen a lull in September. Is that it?
ACHUTHAN: My guess is yes, that is it and that would be consistent with an early 2002 trough in the economy. Between now and then, the economy is going to continue to probably slip. Early 2002, somewhere in the first quarter, we'll bottom and begin turning up.
This is a forecast of timing. When will we turn and go the other way? The magnitude, I think, remains a question. The slope of the recovery, how strong will it be, remains a question. There are some significant headwinds that are still out there.
DOBBS: Most significant among those headwinds?
ACHUTHAN: Employment. I think we still have some job losses we're hearing more about them today, that are going to weigh on the consumer's ability to have a cyclical recovery in their consumption. Also, the global cyclical downturn. We had recessions in Germany and Japan, and so our typical markets abroad are very weak. DOBBS: But in Europe the downturn has not been as bad as some had feared, at least to this juncture. If we look at this market as having hit a low and recovery coming in the end of the first quarter, as you suggest.
ACHUTHAN: Somewhere in there.
DOBBS: When will we have a confirmation that we're back to growth?
ACHUTHAN: Back to growth, when the coincident indicators begin rising. So let's see how those do in February and March. We'll have to wait until about April to get that data.
DOBBS: When you say a coincident indicator?
ACHUTHAN: I mean things like production and employment. When job loss is really slow. I mean, we still have negative job losses. It's not as bad as it was, but it's still negative. It's still the wrong direction.
DOBBS: But of course we can have continued job losses with a growing economy.
ACHUTHAN: We did in 1991. That was the jobless economy, an anemic recovery. So that's why I would caution a little bit on banking on a very vigorous recovery at this point.
DOBBS: OK, well we'll take that tapping. We're going to get you back here to see you pounding.
ACHUTHAN: OK.
DOBBS: Lakhsman, thanks. Still ahead, we'll be talking about an asteroid with incredible destructive power that got very close to Earth. The question tonight, however, is why didn't scientists see it sooner?
And one of Wall Street's biggest brokerages, cutting its workforce again. Those stories, a lot more still ahead. Stay with us.
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DOBBS: Well this just in to CNN. The Justice Department has reportedly opened a criminal investigation into the collapse of Enron. The Associated Press reporting that the Labor Department and the Securities and Exchange Commission have already launched several investigations, and now the Justice Department's stepping in. Enron's investors and its employees lost billions of dollars when Enron went bankrupt, the largest bankruptcy in corporate history.
Well, some scientists say that a lack of funding is to blame for the late discovery of a large asteroid that narrowly missed planet Earth Monday. An asteroid with the ability to destroy a small country traveled relatively close to Earth, that only weeks after astronomers first noticed it heading toward the planet.
Scientists say they have the ability to track asteroids on a close trajectory with Earth, but they still lack the funding and the manpower to do it regularly and with a high degree of certainly. If done properly, one astronomer we talked with said, an asteroid could be discovered decades before it could cause any damage. That should be plenty of time to figure out how to deflect the asteroid.
Well, satellite company Loral reaching a settlement today with the United States. There were allegations that the company might have violated rules regarding the transfer of satellite technology to China. Regulators were reviewing whether Loral knowingly sold sensitive missile technology to the Chinese. Under that agreement, Loral will pay a $14 million fine to the State Department without admitting nor denying the government's charges.
Separately, the nation's biggest brokerage firm continuing to cut its workforce. Merrill Lynch today announced 9,000 job cuts, 2,500 of which were previously announced. Merrill, taking a $2 billion charge to cover the costs. Since the beginning of last year, Merrill has cut 15,000 jobs, just about 20 percent of its workforce.
The number four brokerage taking different steps, trying to boost its bottom line. UBS PaineWebber reducing the commissions some of its brokers receive. PaineWebber hoping that move will shift clients into accounts based on fees, a more dependable source of revenue than commissions.
"WOLF BLITZER REPORTS" begins in just a few minutes. Let's go to Wolf to find out what's in store -- Wolf.
WOLF BLITZER, "WOLF BLITZER REPORTS": Thank you very much, Lou. We're following a developing story in Pakistan where a U.S. military plane has crashed with seven marines on board. We'll get details.
Also, the U.S. Naval Base at Guantanamo Bay in Cuba is about to receive the first batch of dangerous Afghan prisoners. Our Bob Franken is already there. He'll join us live via videophone.
All that plus our "WAR ROOM" panel is right at the top of the hour -- Lou.
DOBBS: Wolf, thank you. Well tomorrow on the economy, weekly jobless claims, import-export prices, wholesale inventory figures all will be released.
Investors will have a lot of economic news to digest, and we'll also have a look at some fourth quarter earnings results, as earnings season picks up. You can expect reports tomorrow from Rite Aid, Rambus, and Rational Software, among others.
Now, let's turn to your thoughts. Consumer borrowing jumped by a record 15 percent in November, and Sarah Leddick of Miami wrote in to offer an explanation as to why consumers are sliding deeper and deeper into debt. She writes to say, "I'm self-employed and work has slowed so much that I'm buying groceries and basic necessities for myself and my 12-year-old son with credit cards. Credit is keeping us afloat during these hard times."
Lavone Biggs has an observation about President Bush's recent remarks on tax cuts.
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BUSH: Not over my dead body will they raise your taxes.
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DOBBS: "Every news person" she writes "they quote him as saying 'over my dead body'. Lavone writes "maybe I'm nit-picking here, but the two statements mean two different things to me."
Well that certainly is understandable, but it may well be a distinction without a difference. But judging by the roar of approval by that audience, it looks as though just about everyone knew what the President meant.
We've noticed an interesting change in sentiment as well for the families of the victims of September 11. Over the past few months, you've been outraged by the slow and often inefficient manner in which charities handled the donations, your donations, and moved them to the families of those victims.
Now there's apparent growing disgust at some of the greed expressed by a few of the families. At issue, the Special Victims Compensation Fund, set up by the Federal Government. Now that fund is designed to pay an average of $1.5 million to the families before deductions for things like life insurance.
But some families are saying it's not enough. Carol writes in to say, "I am absolutely outraged at these widows who are complaining about how little they will get from the government. How dare they turn this tragedy into a money grab. This whole ordeal is tragic enough, greed has no place in this mess."
And Hazel Eichenberger of Switzerland writes in to say, "An award of $1.6 million certainly can't replace a loved one, but is in itself a generous amount."
Send us your thoughts. Our e-mail address, moneyline@cnn.com. Please include your name and your address.
For this Wednesday evening, that's MONEYLINE. Thanks for being with us. Good night from New York. "WOLF BLITZER REPORTS" begins right now.
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