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CNN LOU DOBBS MONEYLINE
Dow Swings Up to 8,427.20; Nasdaq Advances to 1,295.30
Aired September 6, 2002 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU DOBBS, HOST: Tonight, the West Nile virus appears to have reached the West Coast, three years after arriving in this country on the east coast. Doctors say they may have discovered the first known case in the state of California. The centers for disease control and prevention says the number of cases is likely to climb farther the as West Nile season peaks.
And Congress, today traveled to New York City, to pay tribute to the victims of September 11.
We begin tonight, with Kate Snow in lower Manhattan.
KATE SNOW, CNN CONGRESSIONAL CORRESPONDENT: Lou, about 300 members of congress made the train ride from Washington, D.C. to show their support.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: President Bush began trying to win international support to remove Saddam Hussein from power, and he will continue to do so this weekend.
KITTY PILGRIM, CNN FOREIGN CORRESPONDENT: Saddam Hussein has not been allowed to buy weapons since 1991. But he still managed to buy them on the black market.
CHRISTINE ROMANS, CNN FINANCIAL CORRESPONDENT: The week ends on a positive note on Wall Street. The Dow industrials finished 144 points higher, the NASDAQ gained 44.
DOBBS: Also tonight, a hurricane watch is in effect for parts of Texas. Tropical storm Fay is on the verge of becoming the first hurricane -- Atlantic hurricane of the season. We will have the latest for you.
ANNOUNCER: This is LOU DOBBS MONEYLINE for Friday, September 6. Here now, Lou Dobbs.
DOBBS: Good evening.
Tonight, the West Nile virus outbreak may have spread across the entire country. Health officials in California are now investigating a probable case of West Nile infection. A young woman was treated for meningitis, which is associated with the virus. She has since recovered. If confirmed, it would mean the virus has completed its journey across the continent.
West Nile virus has virtually exploded across the country over just the past month, spreading from five states to 29. The number of human infections and deaths have increased more than eightfold.
And as of this broadcast, 854 people have been infected by the virus. 43 of them have died. And federal health officials say the number of infections is likely to peak well above 1,000.
Also tonight, health officials are trying to trace blood donated to -- to West Nile virus victims. They are trying to determine whether the disease can be transmitted through blood. With no screening test available there is concern that West Nile virus could be spread through the blood supply, undetected.
Some 300 members of congress today, traveled to New York City in a move draped in symbolism. They met at Federal Hall for the second time in more than 200 years.
Kate Snow joins me now from lower Manhattan with the story for us -- Kate.
SNOW: Lou, joining me from right next to the New York Stock Exchange.
As you mentioned, about half of the members of congress boarding a train in Washington, D.C., headed up on an Amtrak to New York's Penn Station today, a special train just for them. The main event at Federal Hall here, in Downtown New York on Wall Street. They held a special commemorative session inside Federal Hall.
SNOW (voice-over): This, the site where George Washington took the oath of office, also where congress first met back in 1789. Today, it was a site for remembrance, and for recognition of the heroism of New York.
(BEGIN VIDEO CLIP)
DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES: One year ago, this great center of history, enterprise and creativity suffered the gravest of cruelties and showed itself to be a place of valor and generosity and grace. Here where so many innocent lives were suddenly taken, the world saw acts of kindness and heroism that will be remembered forever.
SEN. TOM DASCHLE (D-SD), MAJORITY LEADER: So what happened on September 11 did not diminish our strength. It renewed it. We stand united today, as proud citizens of the oldest and strongest democracy on earth. Our faith in that democracy and in our future is absolute and unshakable.
(END VIDEO CLIP)
SNOW: After the meeting, the lawmakers headed down about four blocks to the site where the World Trade Center once stood, known as Ground Zero, for a wreath-laying ceremony. That is the last event on their calendar today. Before that, they had had a luncheon hosted by the mayor of New York City, Michael Bloomberg. At that luncheon, he thanked congress for its support for New York, for its financial support in particular. He was also given, Lou, a flag, a United States flag that flew over the U.S. Capitol back on September 11 of last year. That flag will be used as part of a permanent memorial at the World Trade Center site.
DOBBS: Kate Snow, thank you.
President Bush today continued to make the case to overthrow Saddam Hussein. He talked with French President, Jacques Chirac and the leaders of both China and Russia. This weekend, he will meet with the British Prime Minister Tony Blair at Camp David.
White House correspondent, Suzanne Malveaux joins us now and has the report -- Suzanne
MALVEAUX: President Bush left the White House this afternoon, headed to Camp David. He is going be meeting with the British Prime Minister Tony Blair to discuss Iraq. It is a discussion that some White House aides say, is critical. The two leaders share the same resolve to overthrowing Saddam Hussein.
As you know, Britain is the only country, with the exception of Israel, that has expressed any type of support in regime change, and the possibility of using military action. The President has yet to make his case to all other U.S. allies. But he is beginning to do just that.
It was early this morning, that the President made phone calls to French President Jacques Chirac, China's Jiang Zemin and Russian President Vladimir Putin. White House spokesperson Ari Fleischer saying those calls lasted for about ten minutes apiece, that the focus was really, to show that the President will continue to consult with allies, that he values their opinions.
He reiterated Saddam Hussein is a threat to the world. Also reiterated that the administration has not decided how to handle that threat, whether or not it would use military action. But as you know, all three leaders have expressed a great deal of reservation about using military action. They are from countries that are permanent members of the U.N. Security Council. They can veto any type of resolution that comes across, that is not to their liking.
Now, White House aides are telling us that they did not expect that the President was going to sway any opinions or change any minds. And the President did not.
This is the reaction from the calls shortly afterward. A spokesperson for the Russian President says Vladimir Putin, and I am quoting, "...expressed serious doubts regarding the grounds for the use of force in relation to Iraq, in terms of both international law and global politics."
A spokeswoman for French President Jacques Chirac told reporters -- and I am quoting here -- "...the up to the security council to take appropriate measures. They should be debated at that time."
Now, the President is going to take his case. He is going to make it before the international community on Thursday. He is going to go before the United Nations General Assembly and do just that, saying that Saddam Hussein must be dealt with, and the credibility of United Nations is on the line -- Lou.
DOBBS: Suzanne Malveaux at the White House, thank you.
Saddam Hussein has, of course, been banned from buying weapons since the end of the gulf war more than a decade ago. That has not stopped munitions and weapons parts from being smuggled into Iraq. Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
PILGRIM (voice over): Back in the 1980s, Iraq was one of the largest importer of arms in the world, spending billions. Major suppliers were Russia and France. Since the imposition of U.N. sanctions over the last decade, Iraq has not been able to buy arms on the open market. But that has not stopped it from smuggling and deals in arms clandestinely.
TIM HOYT, U.S. NAVAL WAR COLLEGE: Periodically, Iraq will hold a military parade. And they held one last year, where they had more surface to air missiles out in the parade than some analysts had thought they had had. That led analysts to believe they have been getting them from somewhere, probably Serbia, who has a lot of surplus missiles.
PILGRIM (voice over): Hoyt also mentions reports that China has assisted in providing fiber-optics communication equipment, which could make air defenses stronger. The defense publication JANE, cites a report in 2000 of Iraq buying spare parts for T-72 tanks and other equipment. Quote "According to a report in January 2000, Iraq has been buying military spare parts from Russia through front companies in the United Arab Emirates. The parts were shipped from Dubai to Basra," unquote.
TOM SANDERSON, CSIS: They also get them from a number of other places. They get some Chinese weapons, they get American small arms, they get Israeli small arms, British, French, whoever has them, they can get them.
PILGRIM (voice over): Iraq will be outgunned in a conventional battle. Iraqi tanks are old soviet models, T-72s, which were state of the art in 1980s, but seriously obsolete, even during the gulf war.
The Iraqi aircraft are Vietnam era MIGS and Mirages, originally supplied by the Soviet Union and France. The Iraqi navy was basically sunk in 1991 and not rebuilt.
MARIN STRMECKI, SMITH RICHARDSON FDN: At this point, they do not have any more than one-third of the total combat power that they had at the -- during the gulf war in the 1990s.
(END VIDEOTAPE)
PILGRIM: And military experts emphasize that the arms embargo has worked. Even though Iraq has been able to smuggle in some munitions, the heavy military equipment has been impossible to procure, at least in conventional arms, Iraq is outgunned. Lou.
DOBBS: Kitty, thank you very much.
Iraq's neighbor Iran, is also building up its military capabilities. Today, Iran announced it had test-fired a new ballistic missile. Experts say that that missile could be capable of carrying a nuclear warhead. Iran is believed to have received missile technology from Russia, from China, and North Korea. That is, however, denied by Iran.
Three men accused of being members of a sleeper terrorist cell in this country were arraigned in Detroit today. The three men each pleaded not guilty to charges of conspiracy to provide material support or resources to terrorists. All three men were indicted last week. A forth man has also been charged. He is not yet in custody.
Security forces in Afghanistan have detained 17 men for questioning about the attempted assassination of President Hamid Karzai.
New video of the Kandahar shooting was released today. President Karzai escaped injury, but the governor of Kandahar province was wounded. A U.S. Special Forces soldier providing security, was also injured in the firefight. American special operations troops killed the gunman. They also killed two other people carrying weapons. One of them was an Afghan bodyguard. The other apparently a bystander.
A U.S. Navy helicopter today, crashed in the Persian Gulf. A civilian cameraman filming navy operations there was killed in the crash. The four crew members were rescued.
The accident happened in the northern Persian Gulf, about 80 miles from the Iranian coast. The helicopter crashed after hitting the mast of a merchant ship that being boarded by the navy. The cameraman worked for a Los Angeles television station.
Israeli forces today, shot dead two Palestinians in the West Bank. Palestinian witnesses said Israeli soldiers raided a hideout in the town of Jenin and killed the two men. The Israeli Army said it spotted two armed Palestinians during a curfew, and them in a gun battle.
There is a new weather danger growing in the Gulf of Mexico tonight. Tropical storm Fay is gaining strength, and it is threatening to become a hurricane as soon as tomorrow evening. Hurricane warnings, in fact, have been posted for parts of Texas, and tropical storm warnings are in effect for some 250 miles of the Texas and Louisiana coastlines. Fay is sitting about 90 miles south of Galveston, Texas right now. The storm is slowly moving two towards shore, whipping up waves and raising tide levels. Forecasters warn that Fay could spawn tornadoes as well, in the region, and some areas could receive up to 15 inches of rain.
Residents of Russia are breathing a bit easier tonight. Rain has cut through a thick cloud of smog, hanging over Moscow. That smog, the result of several wildfires that have been burning all around the city, despite the rain, carbon monoxide levels in Moscow were still more than twice above acceptable levels. And people were still being urged to remain indoors.
Typhoon Sinlaku slammed into northern Taiwan earlier today. The high winds and heavy rains forced the evacuation of some 100 people. Two others are reported missing. The typhoon's high winds have been clocked at 180 miles an hour. Rail and air traffic has been halted. And Taiwan's stock market was closed throughout the day, because of the storm.
Sicily is recovering from its strongest earthquake in two decades. The 5.6 magnitude quake struck this morning. Three people were injured, two elderly people died after suffering heart attacks. Several historic buildings in the capital of Palermo were damaged. The earthquake was followed by more than 70 aftershocks.
Well, in this country, a decline in the unemployment rate lifted stock prices on Wall Street today. Stocks closed out the week with a solid rally. The Dow, in fact, posting its forth triple digit move, and this one higher. The Dow Jones Industrial is up nearly 144 points. The NASDAQ surged 44 points. The S&P 500 gained 15 points. We will have complete coverage of the market later in the broadcast.
Still ahead, retirement is often described as a golden time. Former general electric chairman Jack Welch is proving just how golden those times can be.
Hundreds of thousands of police officers are struggling to make ends meet. We will have a special report for you on one of this country's lowest paying professions. And one of its most important jobs.
The author of THE WAR AGAINST AMERICA tells us why she thinks Iraq was involved in the September 11 attacks, and the bomb attack on the World Trade Center in 1993.
That and a great deal more still ahead here. Stay with us.
(COMMERCIAL BREAK)
(AUDIO/VIDEO GAP)
DOBBS: -- bombing back in 1993. Laurie Mylroie joins us now.
Good to have you here.
LAURIE MYLROIE, AUTHOR "THE WAR AGAINST AMERICA": My pleasure.
DOBBS: In your new book, you suggest this connection, and principally focusing on the first attacks against the World Trade Center. What is your best evidence of that fact?
MYLROIE: Well, that is what New York law enforcement believed back in 1993, particularly New York FBI. Why? Because there are Iraqis all around the fringe of the plot. One of them is an indicted fugitive who fled to Baghdad, and he remains there today.
Secondly, Jim Fox, who headed New York FBI, recognized that the people he was arresting in the immediate wake of the bombing, like 26- year-old Palestinian Mohammad Salameh, who returned the deposit on the van that had carried the bomb, these people alone were not capable of carrying out such a massive attack.
And the ease of their arrest, suggested to Fox, a conspiracy masterminded by others, who those people left behind to take the blame. Finally, one can demonstrate that the mastermind of that bomb, Ramsey Yusef is an Iraqi intelligence agent, because of documents altered in Kuwait while Iraq occupied Kuwait.
DOBBS: Why then, with this -- your principal evidence arising from New York law enforcement authorities -- local authorities, as well as federal, Laurie, why in the world did not the Clinton administration react?
MYLROIE: Well, Clinton did react, when he attacked Iraqi intelligence headquarters in June of 1993 with cruise missiles, he believed that that would take care of the Iraqi terrorist threat if New York FBI was correct in its suspicious about Iraq, that strike would deter Iraq from all further terrorist attack against the United States, not just the attempt to kill George Bush.
And this is something I cautioned Martin Indyk about when Indyk was head of -- was NSC adviser on the Middle East. It was December '94. And I cautioned him, that one strike on an empty building would not stop Saddam forever.
DOBBS: Indeed, as we -- as we know, there -- nothing much has stopped Saddam Hussein.
Let me read something you wrote in "The National Review", if I may, Laurie, and we can put this up for our viewers to read at the same time. "It is inconceivable that al Qaeda alone could have pulled off the most lethal terrorist attacks in human history. Indeed, U.S. forces have found virtually no documents in Afghanistan related to 9/11 or to any other terrorist strike on America. That suggests the terrorist attacks were planned elsewhere."
The fact of the matter is, that may suggest to you that they were not -- that they were planned somewhere else, but CNN, other news organizations, as well, in fact, have now found al Qaeda tapes talking very specifically about the terrorism they are going to conduct against the United States. Does that, in any way, mitigate, in any way, change your view?
MYLROIE: Not really. At the time that that article was written, there had been one document, a draft to the letter that was used by the Arab journalist to get in and access (UNINTELLIGIBLE) mosoud. But not really.
There should be much more documentation regarding the preparations for 9/11. But more to the point, it used to be prior to the 1993 attack on the World Trade Center, that major terrorist strikes against the United States were assumed to be state-sponsored. For all practical purposes, that meant Iraq, Iran, Syria, and Libya.
And it was with the Trade Center bombing in '93, one month into Clinton's first term in office, that the notion was developed that there was a new kind of terrorism that did not involve states. Well, that is a notion that specifically associated with the Clinton administration. It really does not make a lot of sense to think that Osama bin Laden and al Qaeda are more capable of a major terrorist attack like 9/11, then a terrorist state, whether Iraq, Iran, Syria, or Libya.
DOBBS: Laurie, I want to ask you -- as we wrap up here. And I want to point out to our viewers you were a former adviser to President Clinton as he campaigned in 1992. Received your doctorate from Harvard.
And the president today, former president being quoted, saying that we should take on the job of completing the hunt for Osama bin Laden before taking on Saddam Hussein. What is your reaction to that statement?
MYLROIE: I think that Clinton is in a very strong state of denial. He personally, by the way he handled the terrorism that began on his watch, bears responsibility for the deaths of 3,000 Americans on September 11.
DOBBS: That is a very strong statement. Why so?
MYLROIE: Because he dealt dishonestly with the terrorism. He believed he had taken care of it, as I described by the strike on Iraqi intelligence headquarters, and allowed the criminal process, the legal process to go ahead, created a false and fraudulent explanation for terrorism. And it kept happening over and over again.
I think the reason he did not take care of Saddam is because he was afraid. Just as he said, if you attack Saddam, Saddam will use those weapons. It seemed easier just to let the terrorism continue. I think they also assumed Saddam could not do anything very serious to the United States, and even if he could he would not dare because of the U.S. response.
DOBBS: Laurie Mylroie, thank you very much for being with us.
MYLROIE: My pleasure, thank you.
DOBBS: On Monday, we will continue to look at further possible connections with Iraq. In this case, in the 1995 bombing of the Alfred Murrah Federal Building in Oklahoma City. We will be talking with Jayna Davis. She will be here to tell us why she now believes an Iraqi terrorist cell was both operating in Oklahoma City, and was directly related to Iraqi intelligence. That is Monday.
Coming up next here, lawmakers on Capitol Hill making a very big deal about the allocation of IPOs by Wall Street firms. But some of those very same lawmakers are not telling us how they may have received some of those very same shares. Former General Electric CEO, Jack Welch is one of the country's richest. We will tell you how his employer continues to maintain his opulent lifestyle, even in retirement.
And in tonight's "Editors Circle," we will be talking with Jim Ellis of "Business Week" (UNINTELLIGIBLE) and Paul Maidment of "Forbes" magazine. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Congressional committees have been kept very busy this summer, investigating all sorts of questionable business practices and questionable business people. Those same committees have been looking into everything from Martha Stewart to the special favors given executives who bought IPOs. One thing congress not looked at so far -- the investing habits of its own membership.
Peter Viles, however, has.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CONGRESSIONAL CORRESPONDENT (voice over): Congress spent the summer hassling Martha Stewart and investigating Wall Street. Still broadening the Jack Grubman probe into how Wall Street decides which investors get shares of IPOs.
One area they are not looking at, the investing habits of its own members. John Lafos has led the charge in the IPO probe, he is also bought IPO shares himself. The stock was HealthCare Services in 1995. Did he get special access to the deal? His office says, no way, and that he lost money on it anyway.
Other IPO investors include Senator Barbara Boxer and her husband. They bought AVENUE A.
And the wife of Senator Jeff Bingaman of New Mexico bought Avanex. There is no specific suggestion any of them benefited from special treatment, but favoritism is undeniably a big part of the IPO game. So one citizen's group wants congress to swear off IPO investing entirely.
JOAN CLAYBROOK, PRES. OF PUBLIC CITIZEN: It does seem to me that IPOs are a different animal. They are not just calling up your stockbroker and deciding you will not invest in a blue chip stock for your retirement or whatever. These are special deals you can only get in on if you know somebody, and if you are somebody. And then you can make a bundle.
VILES: Others believe, however, that once lawmakers report these IPO trades as required, voters can be trusted to police the issue.
STANLEY BRAND, BRAND AND TRULLA: I think, you know, the best remedy for most of this is a dose of antiseptic disclosure. If it stands up to scrutiny, then it is fine. If not, they have to answer to the constituents.
(END VIDEOTAPE)
VILES: Now congress is investigating a very specific aspect of the IPO game, specifically, favoritism for executives who were also investment banking clients. No mention this summer, of other kinds of favoritism. For example, was there special favors for powerful mutual fund managers, or perhaps for powerful members of congress? Nobody's asking those questions in Washington -- Lou.
DOBBS: Peter thank you very much. Peter Viles.
Well, Jack Welch has long been praised and studied as General Electric's legendary chief executive officer. Now the revered corporate leader is teaching his peers another valuable lesson, how to live very well in retirement. Greg Clarkin has the story.
(BEGIN VIDEOTAPE)
GREG CLARKIN, CNN CORRESPONDENT (voice over): At GE, they bring good thing to life. And they will help you live the good life for the rest of your life, if you are Jack Welch, that is.
In a day and age when retirees are ushered quickly out the door, the generous and caring folks at GE are trying to make a difference. Looking after their former revered CEO in his retirement, making sure he is housed, fed, and entertained in grand fashion. The GE board has showered Welch with a lavish package of perks, details coming which are coming out now in his divorce case.
NEL MINOW, THE CORPORATE LIBRARY: What was the board thinking when it agreed to all this? The compensation committee should all quit.
CLARKIN: Now as for Jack, a retiree needs a roof over his head. GE is picking up the tab for a central park west apartment he can use, and a man's got to eat, so GE covers the cost of his meals at a four- star restaurant in the building.
Lets say Jack wants to cook. GE has got him covered there as well. They pay for the cost of food and wine. And hey, the place has to smell nice. You guessed it, GE pays for the flowers. Divorce lawyers who have seen it all say it is just another peek behind the curtain of corporate America.
RAQUL FELDER, DIVORCE ATTORNEY: Well, the dirty underbelly of corporate life is now out in the open and people are learning that, while they are working they get tremendous perks, apartments cars, meals paid. But what they are finding out now is after you are not working any more, you are getting tremendous apartments, cars, bills paid, too. So they (UNINTELLIGIBLE) write their own ticket when they leave.
CLARKIN: Welch has responded to the uproar, saying GE's market cap increased by about $400 billion during his tenure, pointing out that not only he, but the little guy, the retirees and others, all benefited.
(END VIDEOTAPE)
CLARKIN (on-camera): And as for some of the cost of this retirement package, the expenses associated with the central park west apartment alone, they are said to be in the neighborhood of $80,000.00 a month -- Lou.
DOBBS: Well, this gives a whole new definition to the golden years, doesn't it.
(LAUGHTER)
CLARKIN: It certainly does.
DOBBS: Great, thanks. Greg Clarkin.
Now time to update our Enron corporate America criminal scoreboard. No criminal charges tonight, so our scoreboard remains 19 to one. The one change: the number of days since Enron went bankrupt, 278.
We're now joined by the senior folks at the three top -- of the nation's three top business magazines, "BusinessWeek," "Fortune" and "Forbes." Jim Ellis is here, he's chief of correspondents at "BusinessWeek." Paul Maidment is executive editor at "Forbes." Rik Kirkland is the managing editor of "Fortune" magazine.
Gentlemen, good to have you here.
Well, let's start out with these markets. We hit the end of the week on a positive note. Can we now be sanguine, relaxed and say happy times are here again Jim?
JIM ELLIS, CHIEF OF CORRESPONDENT, "BUSINESSWEEK": Not yet. I think that a lot of people still want to see some profits before they're willing to put the money into the markets. I think that we had a positive sign in employment today, but it's going to take a lot more, I think, people I think a lot of before want to throw money into this.
DOBBS: Paul?
PAUL MAIDMENT, EXECUTIVE EDITOR, "FORBES": Yes, there's certainly lots of vulnerability points to the market and the economy. It's by no means certain we're going to avoid a double-dip recession. It's perfectly possible.
RIK KIRKLAND, MANAGING EDITOR, "FORTUNE": I don't know about a double-dip, but the signals are still mixed on the economy. And then there's the overhang of Iraq. And I think until those things are removed, it's going to be tough for the market to go anywhere but sideways.
DOBBS: Our viewer response here suggests a lot of concern about Iraq on a number of levels. Some of it is partisan, some of it is extraordinarily reasonable and thoughtful.
But at this point, how much of an influence is the prospect of conflict with Iraq, in your judgment, in the market?
KIRKLAND: I don't know, it's hard to quantify, Lou. I mean, we know -- there's an estimate that there's a 5 or 6 buck premium in the oil price right now because of that uncertainty.
And the market, I just think it's hard to let the animal spirits rip (ph) when you've got the uncertainty of a huge spike in oil prices and geopolitical tension hanging over you because of it.
So I don't know how you quantify it, but it's there.
ELLIS: I think that the big scare from Iraq is not in the market yet. I think that what happens is, if we do do something, the economy's only hanging on because of very strong consumer sentiment. And what happens if you sort of give people a reason to stop spending.
And I think that that's when we really will have a problem. And I think that that's why Iraq could be the trigger to send this economy really tanking.
MAIDMENT: I think the other thing is -- you go back to the advance of the Gulf War 10 years ago, market's very nervous and falling ahead of it; the conflict started, the fighting started, markets recovered very strongly.
The big difference this time around is that we have no idea what the end game is. It's clearly not going to be over in a few days, whatever happens, as it was in Kuwait. And all the questions on what the future shape of Iraq will be like afterwards, what the economic implications will be bad throughout (ph) the Middle East conflict, for world trade, for Western Europe, the amount of support America gets from Western Europe going into the conflict.
These are all huge uncertainties. And I think it is wearing on the markets.
KIRKLAND: We have the Arab world with us in that coalition, and they don't want to see this happen now. They're afraid of what their own street will do. So that's a big problem.
DOBBS: This is a curious thing to me, because the Arab states, 11 years ago in the Gulf War, while with us, were not particularly helpful, beyond Saudi Arabia, which was providing bases and, of course, Bahrain, Abu Dhabi.
But the fact of the matter is, in this particular situation, isn't there a likelihood of greater uncertainty if there's a demonstration that Saddam Hussein does possess weapons of mass destruction and nothing is done about it?
KIRKLAND: That's what the president is doing right now. What may change this a little bit, at least in terms of sentiment about taking action against Iraq, is if he makes the case that shows us what he knows. And he hasn't done that. And he was quiet over the summer. He had a surrogate speaking and debating and warring. And now he's promising -- he's meeting with Tony Blair this weekend. He's going to be talking up here in New York next week. And maybe we'll begin to see what the case is, and that could change sentiment.
ELLIS: Yes, but let's not forget that this part of the world isn't exactly the cradle of democracy. I think that a lot of the regimes there are worrying about the instability that might come from within their own borders if people see a way to sort of topple dictators.
So I don't think that they're completely, you know, sort of taking this simply because they don't want to get behind the United States.
MAIDMENT: I think also there's no sense, particularly in the Middle East, also it's shared in Europe as well, that toppling Saddam is necessarily America's first priority compared to other things that have got to be sorted out in the Middle East like the Israeli- Palestinian conflict.
And now I think Europeans certainly would agree that the world would be better off if there was a regime change. However, they, like the American people, are waiting to hear a clear and distinctive case about why Saddam should be the number one priority. It may well be that the administration has very good evidence of Saddam's complicity in all sorts of terrorist attacks and backing al Qaeda and the such- like.
But this needs to be laid out, and a convincing case made.
DOBBS: It is interesting, to me, at least, that Iraq, at this point, we hear this expression, "regime change." The Bush administration has fathered it, if not -- anyway, they've been using it, remarkably, if not originally.
You know, I wouldn't be any more reassured if any regime in Iraq had weapons of mass destruction, even if they did change the regime.
Would you, Jim?
ELLIS: No. I mean, I think that that's a fairly unstable part of the world. I also think that we have learned now that governments, even those that seem to have secure control of their borders, don't really seem to control their people very well.
And so even if we are able to take out one regime, that doesn't necessarily mean we can take over all the factions, or at least have all the factions in that country behind where we want to take the country.
MAIDMENT: But even talking about Iraq as a country is rather dubious. I mean, one of the big things that's not been talked about at all, at least on this side of the Atlantic, is the shape of Iraq after any successful military intervention by the Americans, and what are you going to do with Kurds? Are you going to support an independent state there? If so, will you support their claims in Turkey, a key American ally?
There are lots of really complicated unknowns about the end game of what's going to happen there. I mean, that's the reason why economies and markets are very, very worried and uncertain about this.
KIRKLAND: The scary analogy is Yugoslavia. I mean, you know, it just rips apart after he goes.
DOBBS: There's plenty to provide sufficient anxiety about much of the Middle East these days.
Let's turn to another regime change, that of General Electric. As Greg Clarkin just reported on some extraordinary list of perks that Jack Welch enjoys. Anybody hear surprised that GE is providing this amazing list?
KIRKLAND: Lou, it's a shocker. And what does Warren Buffet call his corporate jet, the indefensible? There's just no good case you can make for it.
I mean, it's true: Jack was an incredible manager, and he delivered enormous shareholder return, as he pointed out in his statement today.
But, you know, there's a restaurant here in New York, the Lone Star Cafe, the slogan used to be "Too much ain't enough." I mean, that obviously was the view of the GE board. And it's just absurd. Absurd.
MAIDMENT: I'm speaking in its defense here. I'm not for the (UNINTELLIGIBLE) minutia I wish. I mean, there's a lot of ridiculous stuff in there.
But there is clearly a brand equity in Jack Welch which pays dividends to GE. It is not at all uncommon, as we all know, in the corporate world, for chief executives to live an extremely lavish life of perks and things like this. And I think also there's going to be a lot of talk about the value of this package, and the true cost of it for GE may be far less than the market costs.
You know, the seats at Wimbledon, very nice for any chief executive, retired or not, no, they're probably free to GE because, after all, they broadcast it.
DOBBS: How about flying the Boeing 737 business jet to Wimbledon to watch it?
(CROSSTALK)
MAIDMENT: Well, if...
KIRKLAND: And the $80,000 a month for apartment expenses. He's retired...
(CROSSTALK)
DOBBS: Paul, are you sure you want to defend this...
MAIDMENT: No I'm just laying out some -- sort of playing devil's advocate here, but nevertheless, I would lay out some cases. Also, remember, this deal in '96 when there was a great deal of concern that he would leave the company, they wanted to have an incentive to keep him to 65. This the price they paid.
ELLIS: This is the danger of -- you know, what happened in the '90s is we sort of threw common sense aside. And we have basically turned CEOs into stars, rock stars, and want to pay them as such.
We can't do that. We have to realize that this is shareholders' money we're talking about.
DOBBS: And you know, at the end of the day, CEOs are just hired help, no matter what they think.
(CROSSTALK)
DOBBS: I'm about to hear from 75 Rockefeller Center, but anyway.
MAIDMENT: Should have come up in the boardroom, not the courtroom.
DOBBS: Got it.
Gentlemen, thanks. Great to have you here. Have a great weekend.
Coming up next, the markets, the day optimism reigns. The major indexes, however, for the week a little down.
Christine Romans will have all of the details for us on the market.
And America's police officers face danger on our streets every day. They earn some of the lowest wages in the nation.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: The unemployment rate fell to the lowest level in five months. The unemployment rate falling to 5.7 percent in August, and from 5.9 the previous month. Thirty-nine thousand jobs were created last month, and that's the forth straight month the economy did add jobs. Hiring and construction, the service sector and the government's hiring of airport security workers contributing to most of those gains.
That decline in the unemployment rate helped boost stock prices today, but a triple-digit gain for the Dow not sufficient to lift blue chips higher on the week. The Dow for the week down nearly 3 percent; the Nasdaq fell 1.5 percent. The S&P 500 down more than 2 percent on the week.
Christine Romans is at the New York Exchange to bring us up to date on the market -- Christine.
CHRISTINE ROMANS, CNN FINANCIAL NEWS CORRESPONDENT: Hi there, Lou. It was a down week, but there were some winners today. At the Big Board, Citigroup was active and General Motors rallied after Bear Stearns gave it rosier earnings targets. AOL rose to a two-week high with other beaten-down techs, and retailers rallied. That reverses yesterday's sell-off. Home Depot, Lou, was the top Dow performer on the week.
Now, chip stocks soared. Investors cheered Intel's mid-quarter update, essentially glad the news wasn't worse. In fact, all five of the most active Nasdaq stocks were higher today.
But there was a bearish outlook from bond fund manager Bill Gross (ph). He says the Dow should be at 5,000, the S&P at 650 and the Nasdaq at, quote, "God knows where." Until then, Lou, he recommends buying bonds. Back to you.
DOBBS: Christine, I'm not sure I heard you right.
ROMANS: That's what he said, Bill Gross (ph), a bond fund manager, recommending buying bonds.
DOBBS: I got that part. It was those index levels that I wasn't quite sure I heard correctly. The Dow at?
ROMANS: Five thousand. Nasdaq at "God knows where," and the S&P at 650. He says that the markets are trading at high multiples to earnings, and those are phony earnings to begin with.
DOBBS: Well, Bill is not a -- is not a -- is not reticent in any case, but he is also a man of some considerable stature. Those are concerning words. Christine Romans, thank you very much.
Still ahead here, "The Dobbs Report." I'll have your reaction to my commentary last night, calling for Augusta to end its exclusion of women.
Also, police work has never been known for its high wages, certainly, but what may surprise you is just how low those wages in fact are for some officers. That story and a great deal more still ahead. Stay with us.
(COMMERCIAL BREAK)
DOBBS: It's one of the most stressful, one of the most dangerous jobs. Police officers, however, are paid less than $40,000 a year. That's about the same as a bricklayer or an electrician in this country. Fred Katayama has this special report in our series on the most underpaid.
(BEGIN VIDEOTAPE)
FRED KATAYAMA, CNN FINANCIAL NEWS CORRESPONDENT (voice-over): Officer Daniel Vautier just loves his beat.
DANIEL VAUTIER, CAMDEN, NEW JERSEY POLICE: I wouldn't trade this job for anything in the world.
Put your hands behind your head, please.
KATAYAMA: He relishes chasing and handcuffing thugs and pushers.
VAUTIER: A good run and good vice lock-up, that makes my day.
KATAYAMA: He works in one of the crime capitals in America, drug-infested Camden, New Jersey, and he patrols the roughest turf, South Camden, a magnet for vice of all kinds.
VAUTIER: Big time crackhouse right there. Heavy duty.
KATAYAMA (on camera): Police officers can put their lives on the line on a daily basis. An average of 165 officers get killed in the line of duty every year. Despite the high risks, the monetary rewards are low. The average officer earns less than $40,000 a year.
(voice-over): A New York Port Authority officer can make $70,000 after five years, but Vautier, a five-year veteran and a second- generation officer, makes $46,000, closer to the national average.
ROBERT LOUDEN, JOHN JAY CRIMINAL JUSTICE COLLEGE: A lot of people don't realize the value of policing in their community, and all too often see police in the negative. And so they're not always high on the list of those people that work for government that are looked upon as deserving of additional money.
KATAYAMA: Lieutenant Lou Hannon, a 20-year veteran, earns more than $60,000 in base pay. He works overtime to make ends meet for his family of four.
PEGGY HANNON, LT. HANNON'S WIFE: There's times when credit card companies call. I say, I'm sorry, I just needed money for -- the car broke down, or if I needed brakes on the car.
KATAYAMA: He could be in for a rough week at work.
UNIDENTIFIED MALE: We got a teletype from the FBI of threats against the police, to kill a cop in one of the (UNINTELLIGIBLE).
KATAYAMA: A deranged woman once sliced his hand, and a prisoner shot and put him out of service for eight months. Hannon studied accounting in college, but chose police work because the beat is more exciting than bean counting. And he feels he's making a difference in his home town.
LT. LOU HANNON, CAMDEN, NEW JERSEY POLICE: I go out there, help the people. I mean, you recover a bike for a kid, hey, they're all happy.
KATAYAMA: When he's off the streets, he's fighting to raise the pay. He heads one of the two police unions here. Camden police are asking for an increase of 3.5 percent to 5 percent. They haven't gotten a raise since their last contract expired three years ago.
Fred Katayama, CNN Financial News, Camden, New Jersey.
(END VIDEOTAPE)
DOBBS: Still ahead, the controversy over whether to allow women to join the Augusta National Golf Club makes "The Dobbs Report" again tonight. My thoughts on the issue, next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: "CROSSFIRE" is coming up at the top of the hour. Let's go to Bob Novak, Paul Begala in Washington -- Bob.
ROBERT NOVAK, CO-HOST, "CROSSFIRE": Lou, it's Friday night, which means we have a couple of political insiders to look at the political scene. Democratic Tony Coelho, Republican Bob Walker. And we're going to talk about the politics of Iraq. You see, in Washington, politics just never ends.
PAUL BEGALA, CO-HOST, "CROSSFIRE": No, it doesn't. Then we'll talk about the People for the Ethical Treatment of Animals who are not behaving very ethically towards fat Americans. They're running ads mocking fat people for allegedly eating meat. And then we will a debate a story you had earlier, Lou. GE's Jack Welch and the sweet deal he got for retirement -- that's actually the same thing, I think, you and I get from CNN, right, Lou -- $15 million apartment, and we don't have to do anything to earn it, right?
DOBBS: I think they are going to call us back for one or two guest appearances a week. Paul, thank you very much. Bob, we look forward to it, gentlemen.
Coming up next, I'll have some thoughts on the reaction to my commentary last night on allowing women into the Augusta National Golf Club. We'll hear your thoughts on the subject, as well as a number of other subjects. Stay with us.
(COMMERCIAL BREAK)
ANNOUNCER: Next week on LOU DOBBS MONEYLINE, securing America's borders. We'll tell you what's being done to improve security on one of our nation's busiest shipping lanes, the St. Laurent seaway. Next week on LOU DOBBS MONEYLINE.
DOBBS: Last night in my commentary here, I suggested to the Augusta National Golf Club that they end their exclusion of women for membership. And I tried to do it with some humor and some perspective. But even that didn't satisfy some women in our audience, who, believe it or not, in rather angry terms said I should have, effectively, ranted and railed against Augusta's head man, Hootie Johnson. Johnson, for some inexplicable reason, has tried to man the barricades of the Augusta male bastion against female assault.
Now, those angry women viewers just might consider following the example of the woman who first asked Augusta to allow women to be members, Dr. Martha Burk. The National Council of Women's Organization should be proud of her leadership. Dr. Burk has presented her case with reason, with principle, humanity and humor. Mr. Johnson has, by all account, been an exemplary businessman and leader of his community, as well as Augusta.
In this case, quite simply, he's made a mistake. But if he's as bright and honorable as his life achievement's demonstrate, he'll fix his mistake very soon. He'll have some help. The members of Augusta make up a sizable portion of the political and financial power structure in this country. Now, they may be stubborn, but they're not stupid. We've all come too far, baby. They may be insular, but they are not insulated. Most of them, in fact, are married, have daughters and granddaughters, and I can't imagine that those women haven't already exerted some significant influence on the membership.
The members' collective conscience must also already have become a force for change. And surely, the members' innate good judgment has already captured the simple truth about Augusta -- that if Augusta is to remain one of the world's most prestigious and exclusive clubs, it must disavow exclusion of any kind.
Now, let's take a look at your thoughts. Many of your wrote in about my interview with Dr. Burk, the chair of the Matinal Council of Women's Organization, the organization demanding that Augusta open its doors to women.
Barry Holmes in Canada wrote to say: "This is an exclusive women's organization bullying an exclusive men's organization. Must all the icons of our culture be diluted to zero value in the interest of political correctness? What a supreme waste of time and talent when the United States has some really serious problems to deal with."
Donald in Connecticut wrote to say: "I think the individuals who own private institutions have the right to set their own rules for membership, even if in the process they cut their nose off to spite their face. When outsiders step in and try to control membership, smoking or other issues dealing with private establishments, we lose part of our democracy."
Sandy in Wisconsin said: "What's the big deal? The golf issue is equal to where someone can sit on a bus."
On the teaching of the September 11 attacks, Randy Blair in Michigan wrote in to say: "I take great exception to the NEA's stance that children are too stupid to discern between the race/political group of individuals who commit an act and the individuals themselves. To not disclose the individuals responsible is paramount to treason. Children aren't stupid, despite the Herculean efforts of the NEA to make them that way."
Michael Finley in Minnesota wrote to say: "The NEA was deliberately misrepresented. All the NEA Web site was saying is that we should not blame American Muslims for September 11."
Those are some of your thoughts. We thank you for sharing them. E-mail us at moneyline@cnn.com. As always, please include your name and address.
Those are your words. Let's go to "Their Words."
(BEGIN VIDEO CLIP)
RICHARD CHENEY, VICE PRESIDENT OF THE UNITED STATES: Today, Congress gathers near that battlefield to honor the character shown and the courage shown in New York these last 360 days, and to remember every innocent life taken in the attacks of September 11.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
SEN. TOM DASCHLE (D-SD), MAJORITY LEADER: I think this is a very important place to be, especially right now. We want to send as clear a message as we can about the solidarity we have with the people of New York, about our determination to recover from this awful tragedy.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
GOV. GEORGE PATAKI, NEW YORK: To think that Congress only for the second time in more the 220 years of history of this country (UNINTELLIGIBLE) a very important message.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
PRES. HAMID KARZAI, AFGHANISTAN: (UNINTELLIGIBLE) was assassinated (UNINTELLIGIBLE) by the Taliban and terrorists. Did that stop him from fighting against them? I was almost killed in Oruzgand (ph). Did that stop me from fighting? I will not stop, I'll continue.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
BRIG. GEN. JOHN ROSA, PENTAGON SPOKESMAN: It's a dangerous place. And the important thing to remember is that that is a very tough mission. Any time you have a personal security detail, it's an extremely difficult thing to do, and our Special Forces troops did it -- did it very well.
(END VIDEO CLIP)
DOBBS: That is MONEYLINE for this Friday evening. Thanks for being with us. Join us next week. Our guests will include journalist Gena Davis (ph). We'll talking about her research that shows Iraq was involved in the 1995 bombing of the Alfred Murrah federal building in Oklahoma City. That's next week; we hope you'll be with us. Thanks for being with us tonight. For all of us, have a very pleasant weekend. Good night from New York City.
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