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CNN LOU DOBBS MONEYLINE

American, British Citizens Flee Indonesia on Advice Of State Department, Foreign Ministry; Sniper Still at Large

Aired October 14, 2002 - 18:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

(BEGIN VIDEOTAPE)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Nothing but cold-blooded killers. They do not value life the way we value life in a civilized world.

LOU DOBBS, CNN HOST: American and British citizens are fleeing Indonesia on the advice of the State Department and Foreign Ministry. The death toll from the weekend terrorist bombing in Bali is expected to rise dramatically.

CHIEF CHARLES MOOSE, MONTGOMERY COUNTY POLICE: I think the progress is -- is going really well. Certainly some of you may deem me an optimist.

DOBBS: The sniper who has terrorized suburban Washington for the past 10 days is still at large. But law enforcement officials now say they're making progress in the investigation.

Ports on the West Coast have reopened but the backlog of ships to be unloaded is enormous. Now that the lockout is over, there are plenty of longshoremen but other shortages are now slow in shipping.

And just when you thought the WorldCom scandal couldn't get worse, it does. A Citigroup subsidiary loaned former WorldCom CEO Bernie Ebbers almost $700 million.

(END VIDEOTAPE)

ANNOUNCER: From the port of Long Beach, California. This is a special edition of LOU DOBBS MONEYLINE for Monday, October 14.

Here now: Lou Dobbs.

DOBBS: Good evening. Tonight, we're broadcasting live from the Port of Long Beach, one of the busiest ports in the country, indeed the world.

And the first of our broadcasts from the West Coast this week and next week. We'll examine a number of issues this week, including the damaging effect of the West Coast port dispute. Tomorrow, we'll bring you an update on the state of the navy's preparation for hostile action in the Persian Gulf, live from the USS Higgins in San Diego. And later this week, we'll be reporting live from Las Vegas, Hollywood and elsewhere, touching on issues from business to politics and entertainment and the environment.

But first tonight, the Indonesian defense minister today blamed the al Qaeda terrorist network and its radical Islamist allies for the bombings on the tourist island of Bali. It was the first time that anyone in the Indonesian government had said the al Qaeda is operating in Indonesia.

More than 180 people were killed when two bombs exploded outside nightclubs in Bali. The dead include many Australians and at least two Americans. This is the worst terrorist attacks since the September 11 attacks of last year.

The U.S. State Department has advised Americans to leave Indonesia because of the terrorist threats. FBI agents and detectives from Australia have joined in the Indonesian investigation.

Today, President Bush linked the bombings in Bali to the attacks on U.S. Marines in Kuwait and the explosion on a French oil tanker off Yemen. President Bush said he believes all those attack were the work of the al Qaeda terrorist network.

White House correspondent Suzanne Malveaux is traveling with the president in Michigan tonight and has the story -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, the president is on the road here to campaigning fund-raising trip to Michigan. He is making the case -- he believes the war on terror can be fought on two fronts: against Iraq as well as al Qaeda. The president sending his condolences to the victims of those families of the Bali terrorist attacks but also making the case -- the point that he believes al Qaeda is responsible.

The president believes that this is just another example, these bombings, another piece of evidence that the U.S. should expand its war on terror. Also, saying that he believes that al Qaeda is more deadly, more dispersed than ever, much more difficult to contain.

(BEGIN VIDEO CLIP)

BUSH: I believe the attack on the French vessel is a terrorist attack. Obviously, the attack on our Marines in Kuwait was a terrorist attack. The attack in Bali appears to be an al Qaeda-type terrorist -- definitely a terrorist attack, whether it's al Qaeda related or not. I would assume it is. And therefore, it does look like a pattern of attacks that the enemy, albeit on the run, is trying to once again, frighten and kill freedom-loving people.

(END VIDEO CLIP)

MALVEAUX: While the president offered few details or evidence about that particular attack, the Bush administration has long suspected that Indonesia has been a safe haven for extremist group as well as al Qaeda. We are told the president is called to call the president of Indonesia in the next couple days -- Megawati -- to express his concerns and also that ask that these terrorists be brought to justice -- Lou.

DOBBS: Suzanne, the White House has been less than pleased with the cooperation of the Indonesian government in fighting the radical Islamists in Indonesia. Is there an indication in the hours and now days since these -- these bombings, that that cooperation is about to improve significantly?

MALVEAUX: Well, the administration certainly hopes so. And the -- President Bush is going to give Megawati a call in the next couple of days. But what is interesting is that they have not talked since this terrorist attack.

Clearly, this delay somewhat an expression of the frustration the administration has felt over the last several months, looking and seeing that, Yes, they have had evidence they believe that al Qaeda has been operating and other extremist groups inside of that country. This is really the first time that Indonesian officials have even admitted that this was a problem.

This administration hoping that this will be a step towards resolving this, taking a second look at the organizations that are operating out of that country.

DOBBS: Suzanne, thank you.

Suzanne Malveaux, reporting from Waterford, Michigan, traveling with the president.

A letter attributed to Osama bin Laden praises the terrorist attacks on U.S. Marines and the French oil tanker. The letter was posted on an Internet site that has been linked with the al Qaeda in the past. This note also expresses solidarity with radical Islamists and other nations, including Indonesia.

National security correspondent David Ensor has the report -- David.

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT: Well, Lou, with three recent terrorist attacks now suspected to be connected to al Qaeda, within the past week or so, there is a heightened level of concern among intelligence officials that another, more major attack could be in the offering, though officials stress they have no credible information about any specific plot.

One reason for the concern: two of tapes recently released, one of Osama bin Laden voice, and another of his deputy, Ayman al-Zawahri, threatening further attacks.

Officials say the amount of chatter among al Qaeda's suspects is also making them edgy, though they say the threat level is not thought to be as high as it was, for example, in the summer before the 9/11 attacks.

It is also the string of recent attacks that have officials uneasy, the attack against the U.S. Marines in Kuwait. Then, against a French oil tanker off of the coast of Yemen. And now, of course, accost -- against a popular tourist spot in Bali, Indonesia.

In the letter you mentioned, on the Internet, allegedly from Osama bin Laden, he is quoted praising the attacks in Yemen and Kuwait.

He says, "The heroic operation in Kuwait proved the level of danger that threatens U.S. forces in Islamic countries." He goes on to say, "We promise the Americans and the Jews won't have peace until they take their hands off our Muslim nation and stop their aggression against us."

Now, even though the letter on the Web has what looks like bin Laden's signature on it, intelligence officials say they do not know whether it is genuine, anyone could have put it there.

Still, there is a sense, Lou, that al Qaeda is stirring again and may have further plans soon -- Lou.

DOBBS: David, the indication, the suggestion that Osama bin Laden is alive -- how significant is that in terms of -- less from the standpoint of Americans, but rather for the radical Islamists who would -- who would likely be in sympathy with him and his aims?

ENSOR: Well, intelligence official, Lou, are holding off on saying whether or not they think this really is bin Laden. After all, he could be dead and they could still put his signature on the Web.

DOBBS: Sure.

ENSOR: They actually attach more significance to the tape last week. The voice of Ayman al-Zawahiri, his deputy, an Egyptian who's regarded as one of the major brains of the operation.

If he's still alive, and in the tape he referred to recent events suggesting -- so that suggests that he is alive, that is of greater concern, and that has intelligence officials talking about whether or not al Qaeda might have further plans -- Lou.

DOBBS: David, thank you very much. National security correspondent David Ensor reporting from Washington.

Another form of terrorism has gripped suburban Washington D.C. for 10 days now. The situation there remains tense as investigators search for the sniper. The public is trying to go about life as normally as possible.

Kathleen Koch has the latest from Montgomery City (sic), Maryland -- Kathleen.

KATHLEEN KOCH, CNN CORRESPONDENT: Well, Lou, it isn't easy to go about life as normal because life can't be normal here right now. Not when gas stations are sites of high anxiety, not when schoolchildren haven't been allowed to -- outside their classrooms, outside their schools except for when they leave in over a week. Police are pursuing leads. They say they've had a lot of false alarms today. People are very, very tense, very uneasy. In his one and only briefing today, Police Chief Charles Moose said he was optimistic. He said the investigation is proceeding very well.

And President Bush today spoke out for the first time on camera, expressing his concerns about the shooting.

(BEGIN VIDEO CLIP)

BUSH: I get briefed on it every morning. Bob Mueller, the head of the FBI, was in this morning and gave me a full briefing on what the FBI knew, how we're helping, what we're were doing. But it's obviously a terrible, terrible situation. And I pray for the -- I pray for the -- the families who grieve and suffer, and I worry about a society where moms can't take their kids to school, and obviously, we are going to do everything we can to help the local authorities bring these people to justice.

(END VIDEO CLIP)

KOCH: Police have given out a new address for people with tips to write to, that's PO Box 7875, Gaithersburg, Maryland, 20898-7875. That, of course, for people who are not comfortable calling in or e- mailing tips. Police say they've also had a surge in calls since Saturday evening when they released that composite graphic of the white box truck that was spotted by several witnesses, apparently at the sites of at least two of the Montgomery County shootings.

We are expecting a similar image of this white Chevy Astro van that several witnesses saw leaving the scene of the shootings Friday in Virginia, but police say that that graphic image, that composite image still isn't ready. They don't want to release it until they have gotten it right.

Now authorities did take some questions today about whether or not it was time for the federal government to take over this investigation, and the FBI spokesman here said absolutely not. Right now, all of the FBI's resources, all of the federal government's resources that are available have been brought to bear on this case.

The only small development that we are aware of at this point is in the very first shooting, the shooting at the Michael's crafts store on October 2, when no one was injured, there was apparently a customer who found some kind of debris inside a magazine, which they believe may have been bullet fragments. Police would not confirm that today, Lou. They would only say that some evidence has been taken from the store and is being processed. Back to you.

DOBBS: Kathleen, thank you very much. Kathleen Koch, reporting from Montgomery County.

Well, in the Middle East today, Israeli Prime Minister Ariel Sharon called upon Palestinians to overthrow Yasser Arafat. Sharon said Arafat was leading Palestinians from failure to failure. The Israeli prime minister was speaking just before he prepares to visit the United States.

In other developments, Israeli troops reportedly shot and killed two Palestinians in a car near the West Bank town of Jenin. An eyewitness said two bodies clothed in military fatigues were brought into a local hospital. The Israeli Defense Agency had no immediate comment.

On Wall Street today, stocks managed to extend a winning streak into a third session, but the gains were modest. The volume moderate at best, ahead of a series of third-quarter earnings reports that will be coming out later this week. The Dow gained 27 points. The Nasdaq rose 10. The S&P 500 up 6 points. We'll have complete coverage of the market here later in the broadcast.

Turning to the West Coast port dispute, longshoremen are trying to clear what is a massive backlog of cargo that built up over a 10- day lockout. The docks reopened last week under a federal court order after President Bush intervened under the Taft-Hartley Act. Cargo is again moving these ports, but not enough to satisfy ship owners, certainly. Casey Wian has our report.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN FINANCIAL NEWS CORRESPONDENT (voice-over): This Evergreen cargo terminal at the port of Los Angeles normally handles about 2,000 40-foot containers a day. These days, the terminal is unloading 3,500 containers, or 75 percent more, onto trucks and rail cars. Even so, backlog from the 10-day port lockout is still slowing the movement of cargo. There's a shortage of everything from dock space to trucks to longshoremen.

Also, the Pacific Maritime Association, which represents steam ship lines and terminal operators, says longshoremen have resumed their work slowdowns up and down the West Coast.

JOSEPH MINIACE, PRES., PACIFIC MARITIME ASSOCIATION: We're not even close to normal at this point. The production is somewhere around 20 to 25 percent below normal.

People just are not being scheduled to work. You'll get to work and you won't have a crane driver, and the whole gang has to go home. People working excessively slow.

WIAN: The Longshoremen's Union blames a shortage of union members and difficulty finding enough qualified temporary workers. It also says members continue to play close attention to safety rules, which the shipping company say is code for a work slowdown.

Meanwhile, truckers want California's governor to declare a state of emergency to force both sides to work longer hours.

STEPHANIE WILLIAMS, CALIFORNIA TRUCKING ASSOCIATION: This is an industry that works -- that opens at 5:00, closes at 4:30, stops for lunch and takes their half-hour breaks, and it's the management and the labor. There is nobody to blame. That's they way they do things. It reminds me a lot of the Flintstones, actually. But times have changed. This is really a state of emergency. We need some relief.

WIAN: With 115 ships still clogging the ports of Los Angeles and Long Beach alone, relief isn't expected for at least four weeks. Both sides resume talks with the federal mediator this week. During previous disputes, the Longshoremen's Union has been able to take advantage of competing agendas within the diverse and highly- competitive steam ship industry. Sixty percent of the PMA's members and nearly all of the steam ship lines are based outside the United States. But this time, shippers are saying they are unified in demanding that the union accept new technology.

ROBERT KLEIST, EVERGREEN AMERICA: I have been in this business for about 50 years, and believe me, I have never encountered a situation like we have to date, where the owners from many different countries are all working together on this.

WIAN: Evergreen says the main bottleneck now is along rail lines, where about 40 percent of its containers end up. Railroads have increased trains from the West Coast by about a third, but even that's not enough.

(END VIDEOTAPE)

WIAN: Steam ship companies are asking customers for patience while they deal with the port backlog. They are also advising consumers to start their holiday shopping early, because they expect some goods to remain in short supply through the end of the year, Lou.

DOBBS: Through the end of the year?

WIAN: Absolutely.

DOBBS: Well, it's somewhat easy to see what part of the problem is, if I could ask that we show some of the background here, Casey, as you can see and as you have been reporting, these ships here at the port of Long Beach, which is -- the port of Los Angeles -- the third largest in the world. These ships here, 115 you reported, still to be unloaded. And if we can come over here to what is the ITS dock, where we have the large cranes. We can see that cargo both being built up. Now, as I understand it, though, all of that cargo once it's unloaded, they have to then move containers back onto the ship, obviously to be sent back to sea.

WIAN: Absolutely, and a lot of those containers, Lou, are empty containers, because, of course, more imports are coming in than we send out exports out to other countries. It's, you know, showing the scene that is really quite remarkable for people who live in this area. They said they haven't seen a scene like this with ships up and down the coast since World War II era, when you would see battleships parked out there.

DOBBS: And this is, we should point out, one of 29 ports that have suffered as a result of this -- this lockout.

WIAN: Absolutely.

DOBBS: All right, Casey, thank you very much. Appreciate it.

WIAN: Sure.

DOBBS: Well, tonight's MONEYLINE poll will address some of these issues. But first, the results of the question we asked last Friday evening. That question, what should be a stock investor's next move? Thirty-four percent of you actually said buy. Twenty-four percent voted sell. Forty-two percent of you said, I think it's a good time to hold.

Now, for tonight's question: Does the rising number of terrorist incidents around the world make you less likely to travel abroad? You can cast your vote at cnn.com/moneyline. We'll have the results for you later in this broadcast.

Coming up next, we'll have more on the fallout from the port shutdown. I'll be talking with executive director of the port of Long Beach and the mayor of Long Beach about the political implications, the economic implications.

And also, this holiday season was supposed to be the coming out party for a hot new doll. Well, what we didn't tell you is right over there in that warehouse, there are a whole lot of those dolls that won't be on shelves. We'll have a special report. Stay with us.

(COMMERCIAL BREAK)

ANNOUNCER: From the port of Long Beach, California, here again, Lou Dobbs.

DOBBS: American businesses, from farms to retailers throughout the country, have been hurt by what was a 10-day lockout of 29 ports -- and, obviously, we're at the port of Long Beach, one of the most important of all of those. It could take more than a month for the backlog of cargo to be cleared from the more than 100 ships along the West Coast who've been waiting to unload. That backlog and heightened national security, now, are the two biggest challenges facing the ports.

I'm joined by the mayor of long beach, Beverly O'Neill.

MAYOR BEVERLY O'NEILL, LONG BEACH, CA.: Thank you.

DOBBS: Good to be with you, thank you for joining us.

O'NEILL: I'm glad you're here.

DOBBS: And the port's executive director Richard Steinke -- Dick, good to have you here.

RICHARD STEINKE, EXECUTIVE DIRECTOR, PORT OF LONG BEACH: Good to be here.

DOBBS: Let me start, if I may, first, Mayor, with you. This has had a tremendous impact, and will continue to have a tremendous impact, on the nation. What has been the political fallout for you here?

O'NEILL: Well, the negotiations are going on in San Francisco, where they -- the port is -- the officials are meeting with the Pacific Maritime.

But fallout here has been, mainly, what it has done to the local economy, what I know it's doing to the national economy, and then seeing the backlog of all of the ships that are here that are parked waiting to go in.

DOBBS: the estimates remain somewhere from $1 to $2 billion of the national economy.

O'NEILL: Absolutely, absolutely.

DOBBS: Dick, as we look around your port here with these remarkable facilities, which I know you're upgrading mightily even as we speak. To see those ships out there, knowing that they're not going to be coming in here just -- at the same rate of, say, a car on an expressway -- suggests that the problem is pretty serious. How serious is it?

STEINKE: Well I think, Lou, it points out to the fragility of the logistics chain that we have here in the United States. One link is broken -- in this case, a shutdown -- and we all feel the pain. And it'll take a long time, as the mayor said, to relieve the backlog. We've got 120 ships here on the port right now, both L.A. and Long Beach, and so we're going to be digging out for quite sometime.

DOBBS: And it's really not -- and I don't mean to suggest it's simple when I say "not as simple as moving these containers from those ships" because supporting all of that are trains and trucks. How important is -- of that bottleneck to clearing all of this?

STEINKE: That's a real important aspect is the multi-modality of this transportation system. As you mentioned, it goes from ships to trains, it may get on a truck, it may get on another train.

All those has to work seem seemlessly in order for good to get to market. And so it's not just a matter of a ship bringing a container in, getting on a truck, and joining one place and ending its journey. It has various journeys to go.

DOBBS: I know you don't want to get into the politics of a labor dispute or in this case a lockout by management. One of the odd aspects of this is the AFL-CIO is upset with President Bush, for invoking Taft- Hartley, yet he broke a management lockout not a strike. So, that's an interesting aspect of this.

How significant is the technology that the Pacific Maritime Association is asking for? And how significant are the Longshoremen Union interests here, in terms of productivity being competitive with world wide ports?

STEINKE: I think it's very important. In the future, we're going to need the advent of added technology on the docks. It's something I think both the management and the labor have to work towards. There's no doubt that we're going to have to grow our ports, we're going to have to use them more intensively than we currently are, we're going to have to work 24 hours a day -- and with that technology's going to have to be a part of it.

DOBBS: Mayor O'Neill is not only the mayor of Long Beach, this wonderful city, but also sits on the Executive Committee for the Conference of Mayors for the country and serves as the head of the California League of Cities.

All of these issues, crushing in not only on Long Beach or the state of California, but the nation. We have national security interests represented here. What do you see as the political dimension of this?

O'NEILL: Well, I think that the ports of Long Beach and Los Angeles really became much more in the public eye after September 11, realizing that this was a vulnerable spot. And people became aware that this complex is the third largest in the world and that this is a vulnerable spot. This a spot where a third of the goods are coming in.

DOBBS: Mayor, I should point out to our viewers, when we say the third largest -- the first Hong Kong followed by Singapore.

O'NEILL: And then Los Angeles and Long Beach.

DOBBS: Or Long Beach/L.A.

O'NEILL: That is right, Long Beach/L.A. But -- and I've talked with mayors throughout the nation. Two mayors in Texas were saying that they have new cargo containers ready for the port to finish their lockout because they were going wanting. So this is happening all over the United States. With the number of jobs and people that are involved in international trade.

DOBBS: There is coming here -- it's not blooming, it's here -- the national security interests...

O'NEILL: We are a national readiness port.

DOBBS: And these containers obviously represent a significant -- could represent a significant vulnerability to the terrorist attack. We're working with the nation of Malaysia right now to work out the security issues with that country.

How significant is this, Rick? How comfortable do you feel with the way in which your ports and, if you will, homeland defense, is dealing with that threat?

STEINKE: I think we have taken great steps since September 11. I know that U.S. Customs, U.S. Coast Guard, INS, the various federal agencies have been working very diligently to reduce the risk. And in that, we are going to have to balance moving these goods that the consumers demand, with security. I don't think we can -- we can completely batten down the hatches. We've seen what a 10-day lockout has done. I think custom has a good handle on identifying anomalies in cargo. We need do a better job than what we have done before. But I think we have made great steps since September 11.

DOBBS: I'd like you both of you to address this, because not a lot of people are looking at it nor discussing it. That is the fact most of these containers, most of those ships and nearly of the shipping companies are -- in the case of ships -- foreign flagged. The shipping companies for the most part, the largest are all foreign -- foreign companies. And we have these national security issues.

How comfortable, how concerned should we be with that? We have seen what a management labor dispute can do to something so vital as trade. What are the political issues that you think need to be resolved? How do you think they will be resolved, Mayor, if I may ask you first.

O'NEILL: We know -- after -- when we realized that we were vulnerable spot, and it was certainly brought to our attentions, we were working very closely, as Dick said with the -- with the Coast Guard and all of the federal agencies.

But then we realized -- and Dick can probably talk to this -- the number of tenants that we have had for so many years, and we know their companies, we know where they come from, we know the people that are involved. So there was -- there was a great deal of scrutiny with all of the ships that came into port and the tankers were treated differently than the cruise ships than the cargo containers.

So we've just had to pay much more attention and work with federal agencies to make sure it happens.

STEINKE: I would agree with the mayor. I think the other aspect is that Commissioner Bonner (ph) is setting up ships with foreign countries, foreign ports well be involved with a partnership very quickly with the U.S. customs, as well as other ports across the country. But they're working with Rotterdam, they're working with Hong Kong, they're working with Antwerp -- a lot of the international ports to make sure that we are securing the supply chain.

DOBBS: Mayor O'Neill, Dick Steinke, thank you both for taking time top join us here.

O'NEILL: Thank you.

DOBBS: I appreciate it.

O'NEILL: Glad you are in long beach.

DOBBS: Glad to be here, thank you very much.

When MONEYLINE continues, we'll be talking with our military analyst General David Grange about the possibility of renewed al Qaeda terrorism, including focus on ports. And port workers forced back on the job. They're continuing to unload these overdue goods but it may be too late for some of these retailers this holiday season. We'll be taking a look at that story.

As well as space shuttle astronauts putting touches on a multi- million dollar addition and also a 14-ton addition to the space station.

All of that, a lot more still ahead as we broadcast live to you from the port of Long Beach in California. Stay with us.

(COMMERCIAL BREAK)

DOBBS: We're reporting tonight from the Port of Long Beach in California.

The effects of the West Coast port lockout continue to ripple through economy. There is still a huge, enormous backlog of goods and cargo. Many of the goods will reach their destinations. But they will be late, and in one particular case, this may be a story of holiday disappointment for many young girls.

Peter Viles has the story.

(BEGIN VIDEOTAPE)

PETER VILES, CNN CORRESPONDENT: We call it a labor dispute, but to girls of a certain age, what's happening in these ports is a hostage drama.

Because held hostage, inside these shipping containers, are millions of these dolls, the Bratz dolls, which happen to be the best- selling fashion doll in America right now. Millions of dolls not coming to a mall near you.

ISAAC LARIAN, CEO, MGA ENTERTAINMENT: We estimate by the end of the year, we will lose fares of close to two and a half million dolls just by itself because of the demand, and because they cannot get in here fast enough.

VILES: Made in China, the Bratz dolls are a blockbuster hit for Issac Larian and his privately held company, MGA Entertainment. Last year, he sold three million of the dolls. Already this year, he's sold seven million, vaulting the sassy Bratz ahead of Barbie as the best-selling-fashion doll.

VILES: But then came the lockout, just in time to disrupt shipments for the crucial holiday season.

LARIAN: I hate to say to the customer, Sorry we cannot supply you anymore goods, and unfortunately I've been put in that position for the past two, three weeks to say so.

VILES: Analysts say the Bratz back-up is a microcosm of what's happening, or rather not happening, across the retail industry. JONATHAN GOLD, INTL. MASS RETAILERS ASSOC.: We're hearing from consumer electronics retailers, who are talking about not being able to get their products to shelves. We are hearing from apparel retailers who are talking about the problems that they're having and the increased cost they are incurring to bring the freight in.

So, it's pretty much across the board.

VILES: This is not a regional problem, limited to the West. The goods stuck in these ports are going to every corner of America.

STACY PAK, PRUDENTIAL FINANCIAL: If you look at what comes in through all of the West Coast ports, it's such an enormous amount of goods. It's not just apparel, it's just not clothing, it's toy, it's shoes, it's electronics stuff, it's plastic stuff, it's plastic Christmas trees. You know, it's everything.

VILES: Isaac Larian has never had a toy this hot, so he's going to great lengths to get the dolls in from China.

LARIAN: Going to take us about 35 days just to clear those 235 containers from the harbor. As a result, we have been flying in merchandise of the Bratz doll at a great expense.

VILES: And at great cost to his own profit margins. Transporting goods from China by container ship is cheap, roughly 40 cents per toy. In normal times, air freight costs about $2 per toy.

But during the lockout, those prices spiked. Larian paid up to $4 per toy and did not raise prices, wiping out most of his profit on those dolls.

(END VIDEOTAPE)

VILES (voice-over): MGA tells that us the first shipments of those trapped dolls have now arrived at their warehouses in California. Still, the company says, some shortages and some lost sales appear to be inevitable this holiday season because most of the containers are still in the harbor behind us -- Lou.

DOBBS: Pete, I mean, that's fascinating.

If I could, I would like us to take a look over here because -- just to underline what you are talking about.

VILES: Sure.

DOBBS: You have trucks moving in here, I hope that you can see them with bear rigs getting ready to load containers on those, moving here with their -- with their cranes to move them onto the ship in the foreground. This one just about ready to be loaded. The activity reaching all the way around, and his is just one of probably 11, 12 docks here, with all of those ships. It's remarkable they're getting -- getting this thing under way that the point.

VILES: This small company says it doesn't appear to be a worst case scenario. They think they will get their dolls in a space of 20 or 25 days, but that's on top of a 10-day lockout, that's a month's delay, the one time a year when they really need these toys in a hurry.

DOBBS: Right. And it is amazing to think it's still going to take the best case scenario, at least a month, to catch up with that backlog, to see all of that activity behind us. It's remarkable to handle.

Just to put that into some context. They handle two and a half million of these containers every year.

Peter Viles, thank you.

Good luck to those ladies waiting for those dolls.

Coming up next: the lockout of these West Coast ports has raised concerns about, not only safety, but national security.

We'll be talking with CNN military analyst General David Grange about terrorism and what America's ports are doing to prevent terrorism.

Also, Bernie Ebbers, not only receives sweetheart deals from WorldCom, one of the companies may have also -- well, loaned him hundreds of million of dollars.

We will have that story and a great deal more, still ahead. Stay with us, as we broadcast live from the Port of Long Beach, California.

(COMMERCIAL BREAK)

DOBBS: There are new fears about the security of the world's ports and shipping lanes, after last week's attack on a French oil tanker off the coast of Yemen. An organization that monitors maritime security says all tankers in the Middle East, Pakistan and Indonesian waters should be on alert. The International Maritime Bureau also says ports around the world should increase their security measures. There are also fears that possible attacks on U.S. cities using freight containers carrying weapons of mass destruction. Freight containers just like the ones behind us.

The United States has already raised security at ports. Now it's reaching agreements with other countries to inspect containers and overseas ports. Joining me now is CNN military analyst, MONEYLINE regular contributor General David Grange.

General, good to have you with us.

Would you assess for us, if you would, the risk, as you see it, in terms of the -- first, let's start with containerized cargo that is moving, the principle form of moving cargo between countries.

BRIG. GEN. DAVID GRANGE (RET.), U.S. ARMY: Well, the biggest problem is just the magnitude of the trade around the world today. In fact, in the next decade, it's supposed to double. So when you mention a two and a half million containers a year right now, I mean, just think of that doubling in the next -- within the next decade.

So, it's almost an impossible task to search everything at hand right now that may be a threat to the United States of America. So, the only way to solve that is to develop technology, to enhance the personnel that must do these inspections and get some depth to the inspection process. To the port of origin or depth off our coast two, 200 miles or so.

DOBBS: I mean, what would be your judgment as to how -- how effective -- what would be your judgment of the real security now after we have seen these heightened measures taken?

GRANGE: Well, Lou, it's definitely a danger. There are vulnerabilities there, it's easy to hide things in containers, some can be specially aligned, hide things in the ships. So, it's a great task, and I think our enemies know that the magnitude of the challenge almost overwhelms the Coast Guard or Customs and other agencies involved in this. And everybody's working very hard but, again, they're not at the size they need to be in order to perform these tasks.

And then they've got the balance between keeping commerce, the daily life going of what Americans expect, the goods they want to purchase and our trade with security. And it's a very tough issue. It's just as tough on our borders, but I think the sea, the ports is even worse.

DOBBS: And, of course, the Coast Guard remains responsible, the first line here, if you will, in the security of the nation's ports and its coastline, obviously. But it is not a force that has been considerably bolstered. It's still is really very much a stretch in terms of both manpower and resources.

Do they need significantly more help?

GRANGE: I believe so, Lou. The Department of Homeland Security, hopefully, will bring this out a little bit more and that'll be refined and improved, but they are -- they are in a shoestring. They're getting support that they haven't had in years. They have maritime safety and navigation aid requirements as well as security. And I think they're going to have to be augmented by the navy in some cases at least off the coast, like the Navy SEALS and other organizations, to help them with this task. But it's an enormous undertaking.

DOBBS: You're -- and we're just about out of time General, but I would like to turn to obviously the bombing in Bali the -- what is now, what we now know to be a terrorist attack on the French oil tanker off the coast of Yemen, the attacks on the U.S. military in Kuwait.

Does this appear to you to be a significant offensive on the part of the al Qaeda?

GRANGE: I think it's a -- yes, I think it's another -- the defensive is starting again by the enemy. Maybe they perceive us losing some momentum, they'll take advantage of that pause and they'll strike either in one or two-man groups or larger forces. And I think all of our enemies, the terrorists, read a book called "Unrestricted Warfare," written by two Chinese colonels that stress attack American in the underbelly, ports, on the borders, the infrastructure, don't take the American military on head-to-head, but hit us at home. And that's the issue here.

The homeland security, the importance of it, why that's theater of war that we have to put a lot of effort in.

DOBBS: General David Grange, thank you.

GRANGE: Thank you.

DOBBS: We want to remind you to vote in our poll tonight. The "MONEYLINE question": Does the rising number of terrorist incidents around the world make you less likely to travel abroad? You can cast your vote at cnn.com/moneyline. We'll have the results for you later

When we do continue, Citigroup faces new scrutiny for loaning hundreds of millions of dollars to a company controlled by former WorldCom CEO Bernie Ebbers.

It's all in the day's work; U.S. astronauts wrapping up their last space walk on the mission to the international space station. We'll have the story and the pictures as well.

And only from California: the pumpkin that is truly king of the patch. You won't believe how much it weighs. All of that, a great deal more, is still ahead.

We'll be back in a minute and a half. Stay with us.

(COMMERCIAL BREAK)

ANNOUNCER: From the Port of Long Beach, California, here again, Lou Dobbs.

DOBBS: Now, the results of our poll tonight. The question: Does the rising number of terrorist incidents around the world make you less likely to travel abroad? Sixty-one percent of you answered, yes, 39 percent say no, and we want to remind you you can continue to vote for the next 23 hours at cnn.com/moneyline on the special. We'll have the final results for you tomorrow evening.

A class-action lawsuit claims that a company controlled by former WorldCom CEO, Bernie Ebbers, received hundreds of millions of dollars in loans from Citigroup's Travelers Insurance Company. This was during the same period that Citigroup/Solomon Smith Barney, was bidding to be the lead underwriter on billions of dollars of WorldCom bonds. Ebbers has not been charged with any criminal act. But he remains under investigation. Allan Dodds Frank has the report in our "Corporate Crime Watch -- Allan.

ALLAN DODDS FRANK, CNN CORRESPONDENT: Lou, first there was a $408 million in loans, WorldCom made to Bernie Ebbers so he can hold on to his WorldCom stock. Then, the charges at Citigroup/Solomon Smith Barney cut him in on $11 and a half million in profits on IPO offerings, while its analyst, Jack Grubman, was helping reel in WorldCom investment banking business.

Now, an allegation that Grubman and Citigroup helped keep WorldCom afloat because Ebbers had borrowed so much money from Citigroup Travelers Insurance unit.

Here are the really big, previously undisclosed numbers coming fro a class-action lawsuit filed by Carl McCall, the New York state controller, against WorldCom former executives and the companies bankers. McCall's class-action lawsuit charges that a Mississippi company controlled by Ebbers, called Joshua Timberlands, got $499 million in loans from Citigroup's Travelers Insurance in September of 1999, and another $180 million in early 2000.

(BEGIN VIDEO CLIP)

CARL MCCALL, N.Y. STATE CONTROLLER: This is the first time that Citigroup has even disclosed the fact that they made these loans. But whatever the amount this certainly puts them in a conflict in terms of therefore being into a position to give an analysis of the value of the stock.

(END VIDEO CLIP)

DODDS FRANK: Shortly afterwards Citigroup/Salomon Smith Barney became the lead underwriter on $5 billion in WorldCom bonds and won almost another $12 billion in bond issues in 2001.

Lawyers for Ebbers, Grubman and WorldCom had no comment. But Citigroup and Travelers disputed the numbers. Citigroup said its various Travelers units lent Ebbers's timber company only $134 million while three other insurance companies advanced the rest. And Citigroup added, quote, "The financing had nothing to do with either any individuals from or the business of Salomon Smith Barney, or WorldCom stock" -- Lou.

DOBBS: Alan, thank you.

Let's take a look now at our "Enron Corporate America Criminal Scoreboard." There are no new charges to report. So the number of executives charged remains at 27. The number of Enron executives charged remains at two. The number of days since Enron collapsed, 316.

The stock market rose for a third straight session. The Dow Jones Industrials moving nearly 7,900.

Christine Romans has the story. Christine, how did the volume look today?

CHRISTINE ROMANS, CNN FINANCIAL CORRESPONDENT: Oh, it wasn't that great. Just over a billion shares of the Big Board, Lou.

But it was three days in a row, higher for the Dow, haven't seen that in more than a month. You had drug stocks, strong, holding the Dow back. Boeing, it lost a big contract, it fell about 3 percent. Also GM and the automakers were pretty weak here today. So that sort of mitigated any advancers.

But three in a row, first time that we have seen that in about a month -- Lou.

DOBBS: OK, Christine Romans, thank you.

CROSSFIRE begins in just a few minutes. Let's go to Paul Begala, Tucker Carlson to find out what they have for us this evening. Gentlemen?

Well, we're trying to get to Paul Begala and Tucker Carlson. Gentlemen, shall we try it again? They're not hearing us, but I will tell you this -- that broadcast will be terrific. We're going to watch, and we hope do you too.

Coming up next, we'll take a look at your thoughts. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Paul Begala and Tucker Carlson were not satisfied with my recommendation for their show. They want to offer their own, and I am delighted to have them do so. Gentlemen?

TUCKER CARLSON, CO-HOST, "CROSSFIRE": Thank you, Lou, it's wonderful to be here. We see the Queen Mary in the background.

As you know, it's traditional, in fact, every year since 1934, a new president's party has lost many seats in the midterm elections. That's not going to happen to George W. Bush, it looks like. We will ask Democrats why.

Also, there's some wonderfully vicious new campaign ads out, we're going to show you the best of them.

PAUL BEGALA, CO-HOST, "CROSSFIRE": And then, Lou, on the other side of the continent there from sunny Long Beach, there's storm clouds in New York today at the Columbus Day Parade where the stars of "The Sopranos" were dissed and disinvited. We'll debate that with two very prominent Italian-Americans politicians and Johnny Cochran -- the lawyer who's so talented he had O.J. found not guilty. We'll see if he's as good a debater, we're going to have him in the "CROSSFIRE" tonight as well.

DOBBS: Paul, you and Tucker sound like you're producing veritable, political alchemy for us this evening. We look forward to it, thank you gentleman. Astronauts from the Space Shuttle Atlantis made the third and final space walk of their mission today as the men connected the last piece of the equipment to the new $400 million girder on the International Space Station. That girder weighing 14 tons, it was delivered from the shuttle almost a week ago. That girder will eventually support huge solar arrays that will power the station amongst other things. The Atlantis and its crew of six leaves the space shuttle Wednesday, scheduled to return and land at the Kennedy Space Center on Friday.

And if Linus and the rest of the Peanuts gang are searching for the Great Pumpkin this year, they have only to look several hundred miles north of here, because they're in Half Moon Bay sits a 1,173- pound pumpkin. Now, that's a beauty by any definition. The pumpkin was the winner of the Half Moon Bay Pumpkin Weigh-Off. Now, that's big in California. It's big around the nation. It's owner, Mark Momberg (ph) will take home the first prize of $5 a pound. That comes to, we have done the math because we're good that the sort of thing, to just about $5,900. The real challenge, carving the thing for Halloween.

Now, lots take a look at your thoughts.

Glenn Heard writes -- and he likes our "Enron Corporate America Criminal Scoreboard" but he does have a suggestion help he wrote in to say, "I want to know of the actual convictions. I will feel somewhat more trustful of the system when these corporate leaders/thieves are not only charged but convicted."

Now, that's a high standard. That's a major demand. And we join you. As soon as we have a conviction, we will begin the conviction scoreboard, I assure you. Unfortunately, we are still waiting here.

Joe Minotti from Connecticut thinks our scoreboard is, simply put, ridiculous. He wrote in to say, quote,"As we all know, there have been many companies and individuals successfully prosecuted by this Justice Department. Is you Enron scoreboard showing an unfair political bias against President Bush?"

Well, that would be the farthest thing from our minds. We couldn't imagine why you would suggest such a thing. It is simply in the interest of public information and to remind everyone, yes, including the Justice Department, that we are watching.

And the final word tonight, goes to Carol Hoffman in Oregon regarding Andy Rooney and his comments about women on the football sidelines. She writes, "Women are spending outrageous amounts of time being offended. I'm still laughing at Andy Rooney's remarks. I choose not to waste life being offended at the right of other people to have opinions."

Now, that is a wonderful opinion, and we thank you for sharing it. We love to hear all of your thoughts, all of your opinions, share them with us here at moneyline@cnn.com. We ask, as always, that you include your name and address. That's MONEYLINE for this Monday evening. We'll tomorrow be traveling to San Diego, California -- we ask to you join us then. We'll be broadcasting live from the deck of the guided-missile destroyer the USS Higgins. We'll be talking with people who run the Navy, talking with the sailors who make the Navy work. We'll be looking at the new Navy, the way it conducts business, its preparations for war in the Persian Gulf. That's tomorrow night. Please join us.

Thanks for being with us tonight. From all of us here, good night from Long Beach, California.

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State Department, Foreign Ministry; Sniper Still at Large>

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