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CNN LOU DOBBS MONEYLINE
CDC Reinstates Travel Warning for Toronto; Israel's PM Perpared to Accept Road Map; Exporting America
Aired May 23, 2003 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU DOBBS, HOST: Good evening, everyone. Tonight a new travel alert because of the SARS virus. The Centers for Disease Control has reinstated its travel warning for Toronto, Canada's largest city, its main business center. We'll have a live report for you from Toronto.
A big step forward for the Middle East roadmap to peace tonight, Israel's prime minister says he's prepared to accept the plan. White House Correspondent Chris Burns will report.
And, former Defense Secretary William Cohen will be here to give us his assessment.
And, we continue with our special report, "Exporting America," tonight why U.S. companies find it difficult to resist the lure of cheap labor overseas.
And, top business editors from "Forbes," "Fortune," and "BusinessWeek" join us for our "Editors' Circle."
Tonight, health officials have issued a new travel warning for Toronto, Canada, because of the SARS virus. The CDC is telling travelers to take every precaution possible to reduce the risk of exposure to the virus. Authorities in Toronto have reported five new potential SARS cases.
Joining us now from Toronto is Steve Chao of our Canadian affiliate CTV. Steve, what is the latest on these five possible new cases?
STEVE CHAO, CTV CORRESPONDENT: Well, Lou, medical officials are still trying to confirm whether these in fact are SARS cases. Now they do so far believe that they've contained these possible cases in one area hospital.
The big question right now is exactly where it may have come from. No one knows at this point and while the U.S. Centers for Disease Control has issued its travel advisory, the World Health Organization, the world body that overseas health around the world, they in fact are holding off on reissuing a travel advisory until a confirmation can be made.
Now at this point, of course, the mystery is there are two possibilities as to where the SARS may have come from. There is one patient out of the five that recently visited southern China, so many people believe that it could have been exported from China and brought back here to Toronto. Another possibility with another patient, of course, is that this patient was transferred from another area hospital where SARS may have been present.
DOBBS: And, Steve, I know the hope was in Toronto obviously that the SARS threat had ended, but certainly that the threat was confined to the medical community but that's not the case here, is it?
CHAO: Well, it's still to be confirmed whether it's what they call community acquired, whether SARS is in fact, has in fact spread to the community. The big fact that this is a mystery is the big question mark and this is why health officials are very concerned.
But at this point they have no leads and we're expecting a press conference later on this evening. That may confirm some more about this but it is a serious blow to the city of Toronto. For weeks now, there has not been another case and those here believe that SARS had been contained.
DOBBS: Steve, we thank you very much and we join you in hoping that this turns out not to be the SARS virus but the early indications are that it has that potential -- Steve Chao from CTV, Toronto, Canada.
Two people are dead tonight, nearly 100 others injured, following a series of car wrecks in Maryland. At least 100 cars were involved in those accidents, the result of heavy dense fog and heavy holiday traffic. Officials say they'll know more about the extent of the injuries when the fog does lift.
Those accidents occurred along a 17-mile stretch of Interstate 68 in western Maryland. That portion of the highway remains closed at this hour. Authorities say visibility was almost zero when those accidents began.
Many of those involved were heading out of town for the Memorial Day weekend, of course. All of the accidents occurred in the westbound lanes of the highway. We'll bring you new information about this developing story as it comes in.
And, tonight, a big step forward to report in the search for Middle East peace. Israeli Prime Minister Ariel Sharon said he's ready to accept the roadmap to peace. Sharon made the announcement after the White House agreed to address Israeli concerns about parts of the plan.
White House Correspondent Chris Burns reports from Crawford, Texas.
(BEGIN VIDEOTAPE)
CHRIS BURNS, CNN WHITE HOUSE CORRESPONDENT (voice-over): Trying to smooth over a rocky roadmap to peace, the president sends a message to the Israelis and gets at least initial positive results.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Prime Minister Sharon accepted the roadmap and that's progress. BURNS: That despite a new wave of militant attacks against Israelis that threaten to send Mr. Bush's roadmap to the ash heap of countless other peace initiatives.
BUSH: He accepted it because I assured him that the United States is committed to Israel's security.
BURNS: Also expressing support for the roadmap, Japan's Prime Minister Junichiro Koizumi as he visited the president's Crawford ranch, and the rest of the group of eight industrialized nations meeting with Secretary of State Colin Powell in France.
The U.S. assurance came in a two paragraph White House statement expressing understanding of Israel's "significant concerns about the roadmap," and that the United States "will address them fully and seriously in the implementation of the roadmap."
White House officials say the statement was the result of considerable diplomatic contacts in the Middle East aimed at nudging the Israelis and the Palestinians to start implementing the roadmap, a plan that's to lead to an independent Palestinian state by 2005.
The next step could be a three-way summit, possibly in early June, in the Egyptian sea resort of Sharm El Shaikh, a site of previous peace efforts.
BUSH: I'm exploring the opportunities as to whether or not I should meet with Prime Minister Abu Mazen as well as Prime Minister Sharon.
(END VIDEOTAPE)
BURNS: That U.S. officials say depends on how much the Palestinian prime minister can try to get the Palestinian militants under control and how much the Israelis can ease the crushing restrictions on the Palestinians. Committing too early to such a summit, U.S. officials say, could take the pressure off those leaders to do something early and bring some early results before such a summit -- Lou.
DOBBS: Chris, as the president said, that is progress. I understand the president also had some very strong words about North Korea. What can you tell us about that?
BURNS: Yes, absolutely, in fact the president and the prime minister were in stereo there. They both said today that they will not tolerate a nuclear tipped North Korea and they say that they will, in their words, bring tougher measures against North Korea if that communist regime does continue with their nuclear program, if they do start reprocessing those 8,000 nuclear fuel rods into weapons grade plutonium.
What will they do? That is the question. They are remaining very vague on that. One Japanese official I spoke to says it could involve cutting off financial transfers from Japan to North Korea. There are a lot of ethnic North Koreans in Japan that send a lot of money over there so that could hurt quite a bit -- Lou.
DOBBS: Chris, thank you very much, Chris Burns our White House Correspondent traveling with the president tonight in Crawford, Texas.
Secretary of State Colin Powell and the French Foreign Minister Dominique de Villepin today said relations between the United States and France are excellent. They talked to reporters after holding their first talks since the end of the war against Saddam Hussein, all of this in preparation for the G8 meeting.
Turning now to Iraq, U.S. troops in Iraq today stopped a truck containing what appeared to be 2,000 bars of gold. If tests confirm that those bars are indeed gold, the consignment would be worth half a billion dollars. The truck was stopped near with Iraqi border with Syria. The two people in the truck said they thought the bars were bronze. They said they were paid $350 to drive that cargo to a town near the Syrian border.
In Algeria tonight, a remarkable story of survival, rescue workers searching for survivors of this week's devastating earthquake came upon an amazing discovery, a 2-year-old girl found in the rubble of a collapsed building. She had survived there almost 40 hours. Nearly 1,400 people have died in that region's worst earthquake in more than 20 years, 7,000 people injured.
From North Africa to North America, Canada today quarantined another four cattle herds because of the Mad Cow Disease scare but U.S. consumers so far at least don't appear to be excessively worried about the outbreak.
Bill Tucker reports.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): Canada widened its quarantine to 13 farms and one feedlot. So far, 750 cattle have been slaughtered preventatively because they were from the same herd as the infected steer in Alberta.
DR. BRIAN EVANS, CANADIAN FOOD INSPECTION AGENT: With respect to laboratory work, the sampling of the animals is now complete. Internationally sanctioned rapid tests are being performed at our National Center for Foreign Animal Disease in Winnipeg and results are expected in the next few days.
TUCKER: Slightly more reassuring the words earlier in the week when Canadian officials breezed past the question of why testing of the original animal took months, not days.
UNIDENTIFIED MALE: In the perfect world we would have had those results out within five to seven working days but it's not a perfect world and you prioritize things the best you can.
TUCKER: There hasn't been a case of Mad Cow in North America in a decade. Perhaps that's what led to the laxity in testing of Mad Cow Disease. But there is this fact Canada exported 1.6 million cattle to the United States last year. It's a near $2 billion business.
SEN. BYRON DORGAN (D), NORTH DAKOTA: For a system that has a severed cow head on a cool shelf someplace for months before it is adequately tested, that's a system that in my judgment provides no confidence, no confidence to the beef industry or the consumers.
TUCKER: As of today, ten countries including the United States have closed their borders to Canadian beef. The European Union will continue to import Canadian cattle.
CHANDLER KEYS, NATIONAL CATTLEMEN'S BEEF ASSN.: We want to assure the American public we're doing everything humanly possible to make sure that our governments are cooperating with one another and that we're bringing results to the tables of America.
(END VIDEOTAPE)
TUCKER: And so far Americans do seem unconcerned. One supplier which supplies over 2,000 supermarkets tells MONEYLINE that prices and sales are both us and that the number of cattle now scheduled for slaughter is at its highest since 1996 -- Lou.
DOBBS: Canada just has a few more than its share of problems right now.
TUCKER: It certainly does, Lou.
DOBBS: Bill, thank you very much, Bill Tucker.
Still ahead, more on the road to peace in the Middle East, former defense secretary, regular contributor to this broadcast, William Cohen joins us.
And later, "Exporting America," companies that are struggling to keep jobs in this country. Casey Wian will wrap up our weeklong series of special reports on "Exporting America."
(COMMERCIAL BREAK)
DOBBS: The White House says there is a moment of opportunity for Israel, the Palestinian and Arab states to advance the Middle East peace process. It follows the Israeli prime minister's announcement that he is ready to accept the roadmap to peace.
I'm joined now by former defense secretary and regular contributor to this program William Cohen, Bill good to see you and to have you here.
WILLIAM COHEN, FORMER DEFENSE SECRETARY: Good to be here, Lou.
DOBBS: This looks like real progress as the president said, do you agree?
COHEN: I think it is a very significant step. I think you'd have to qualify it as saying being cautiously optimistic because, on the one hand Israel's acceptance of this roadmap is very significant provided there are not general exceptions which then would either eviscerate or outweigh the rule itself, namely the acceptance of the roadmap which calls for two things, simultaneity and reciprocity, two big words, but basically saying we have to have some reciprocal steps taken nearly simultaneously by both parties.
One would include the freezing of the settlements, the other of course trying to cut down if not eliminate the terrorist activity which is going to take a great deal of effort on the part of Mr. Abbas.
DOBBS: And, some effort on the part of Mr. Bush as well. What do you think of the idea of the president meeting with Abbas and Sharon to get this thing moving?
COHEN: I think it's absolutely essential. I think that the president should meet with both of them. If it's going to be in Egypt at the Sharm El Shaikh, that would be fine. Getting Egypt involved would also be important, along with the Saudis and others eventually.
But I think that it's important for the president to show to the world that he, in fact, is committed to this process. This was not something that was a pledge to Tony Blair as some sort of compensation for his contribution to the war effort. This is serious. The president means it and he can show that by agreeing to meet with these two leaders and that would be a very symbolic and significant step.
DOBBS: You know, Bill, a year ago about this time or a little earlier, the United Nations had a real opportunity to advance it appeared Middle East peace. Kofi Annan could not apparently take a direct and driving role. The president has that opportunity now. Do you look upon this as the last best opportunity or is this, do you think, wary, weary, geo-politicians are looking at this as just a continuation of what has been a 50-year process?
COHEN: Well, it's certainly the best opportunity we've had in the last couple of years. I think there was an opportunity during the Clinton administration with Ehud Barak, the Prime Minister of Israel, who made some very I think generous commitments in trying to bring about a peaceful settlement. Mr. Arafat was not prepared to accept it at that time. There may have been some reasons why but it was befuddling to the Clinton administration to be sure.
There was an opportunity two and a half years ago. There is an opportunity now. We ought not to continue to witness the passing of these opportunities and consign them to the dust bin of history as was reported earlier. This is too serious to allow to continue to go without U.S. leadership and, frankly, we are the only ones that can bring the parties together and to bring a consensus and build that consensus throughout the region.
DOBBS: Bill.
COHEN: The Palestinians can't do it on their own, the Israelis can't do it on their own. It requires the U.S. along with many other states in the region. DOBBS: Saudi Arabia has sent every signal it possibly could since the bombings in Riyadh that it is changing its ways that it is taking on a new serious and responsible outlook on its responsibilities in the region. Is there a role here? You mentioned Egypt. Is there a role here for Saudi Arabia to publicly disavow and aggressively, vigorously decry terrorism and support the Palestinians and the Israeli-Palestinian peace process?
COHEN: Oh, I think there is. As a matter of fact, there was a so-called Saudi initiative that was brought to the surface last year which was not new.
DOBBS: Right.
COHEN: It was an old proposition but I think we should have seized upon that. We should seize upon it now to bring the Egyptians, the Saudis, and others into this process to make sure that we have a complete Arab nation commitment to this process.
I think the Saudis play a critical role, the Egyptians, and others, the Jordanians will play an important role. All of them have an interest in seeing this process go forward, to have security for Israel, a separate Palestinian state in existence by the year 2005.
I think that that will -- that certainly is the roadmap that ought to be followed and I want to, again, urge President Bush as he's been very courageous in putting this policy forward, to now take the next step and meet with these leaders.
DOBBS: Bill Cohen, thank you very much.
Coming up next, a driving ambition, we'll have the very latest on Annika Sorenstam and her historic round today and yesterday at the Bank of America Colonial. We'll have a live report on this second round from Fort Worth, Texas to see whether or not she'll make the cut. She's made history.
The editors of this country's leading business magazines join us for our weekly "Editors' Circle." Mark Morrison, managing editor of "BusinessWeek," Steve Forbes, editor-in-chief of "Forbes," Rik Kirkland, managing editor of "Fortune" all here to talk about the tax cut, the rising deficit, the trade deficit, and of course an improving market and economy. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Annika Sorenstam receiving some high level support today.
(BEGIN VIDEO CLIP)
BUSH: I'm impressed by Annika Sorenstam. I hope she makes the cut. I'm pulling for her, and I hope I'll be watching her on Saturday and Sunday.
(END VIDEO CLIP) DOBBS: Along with a lot of other people hoping to be watching her Saturday and Sunday and President Bush not the only one waiting to see whether she'll be playing. She's right now trying to make her way to the third round of the Bank of America Colonial Golf Tournament.
Josie Karp is in Fort Worth and has the very latest for us. How's she doing, Josie?
JOSIE KARP, CNN CORRESPONDENT: Not very well, Lou. It looks like she's going to disappoint herself and the president as well. She's through 14 holes. She's four over on the day and five over for the tournament in general and it looks like the cut right now is projected at even par and it would take some sort of miracle in order for her to make that.
And, when we spoke yesterday, Lou, at this time there was a real giddiness in the air after she posted that one over par 71 after the first round, and today it looked after a birdie on two, things got off to a great start for Annika Sorenstam but then the wheels really fell off.
And yesterday her playing partner said that she was almost machine-like she was so consistent but she's really been the opposite of that today. She has missed fairways. She has missed greens. She has missed putts and you can bet that this is a day -- yesterday she said she would always remember her first round. This is probably a round she wants to forget as soon as she can get off the golf course.
And, what will be very interesting to see is just how the mood changes. After that round one, pretty much across the board everyone said that no matter what Annika Sorenstam did in round two, whether she made the cut or not, that she'd already scored one victory.
But today's round will probably test that because it wasn't just average. It was a bad round compared to all the other men and now it's going to be a question of why did it happen and what's the result? Obviously, a lot of mental fatigue today -- Lou.
DOBBS: Well, you talk about mental fatigue. The pressure she is under, the focus on her to play the game, just dealing with that if she weren't playing golf would be tough enough. She's made a terrific statement no matter what happens.
We're going to be checking -- you said she's on her way to the 15th hole, Josie?
KARP: Exactly. She's got 15, 16, 17, and 18, and the crowd supported her and it's going to be interesting to see her come home here. I'm sure she'll get the cheers.
DOBBS: Well, we're going to check back with you, so if you would stand by and keep us up to date as she makes her way through those final holes we'd sure appreciate it. And, I suppose, Josie, there's also got to be some great credit given to Bank of America, the sponsor of this tournament that gave her an exemption here, what's the feeling there? KARP: Well, they'll tell you they stayed out of that, Lou that they had nothing to do with actually handing out the exemption. What they will tell you is when it became clear that Annika Sorenstam wanted to play here, they let the folks at Colonial know that they would wholeheartedly support her being offered one of those sponsor's exemptions.
And, certainly, I spoke to Dockery Clark the woman who's in charge of all of their sponsorship over there at the Bank of America and this is as good as it gets over the first day. Of course, they were pulling for seeing her on Saturday and Sunday. They're going to be disappointed too just like the president and Annika -- Lou.
DOBBS: And a few of the rest of us as well. Josie, maybe she'll pull out a miracle here at the end. Thanks a lot. We'll be going back to you.
Coming up next, "Exporting America," tonight protecting jobs in this country what some companies and the government are doing to keep jobs in this country.
And our CEO of the Week has his company pacing the competition, that story and a great deal more still ahead. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The president next week expected to sign into law $330 billion in new tax cuts. The Senate today passed the scaled-back version by a vote of 51-50, courtesy of the vice president's tie- breaking vote. The measure also gives $20 billion in aid to cash strapped states.
Tax cuts take us to the "Quote of the Day" a (unintelligible) in point of fact from Capitol Hill. "The bill accomplishes the goals that we all share in this body and that is to move America forward, to grow the economy, and to create jobs and job security for all Americans," that from Senate Majority Leader Bill Frist.
A somewhat different view, however, of the same legislation: "The gimmickry in this bill is enough to make an Enron executive blush," that from Senate Minority Leader Tom Daschle with less than a sunny outlook on the legislation.
The president is also expected to sign the largest ever increase in the national debt limit. The Senate today approved raising the debt limit to $7.3 trillion. The debt has swelled to its current legal limit 6.4 and, of course, we will as we show you there monitor the size of the debt every evening on this broadcast just to keep in focus some of the truth and consequences of what is at work in fiscal policy in this country.
On Wall Street, stocks ended the week slight gains in a few places. The Dow Jones Industrials up seven points, closing at 8,601. The NASDAQ up two and a half points on the day. The S&P 500 up more than a point. More good news on the economy from the advertising world, Christine Romans joins us now and she has more on that and the markets leading indicator to help us out here.
CHRISTINE ROMANS, CNN CORRESPONDENT: Absolutely. Advanced ad sales for the fall TV season, Lou, really strong, stronger than most people expected up 11 percent, $9.8 billion. That's on track, Lou, for a record.
The big spenders this year are the pharmaceuticals, retailers, entertainment companies, and fast food chains, and many say it signals a stronger economy in the fourth quarter and into next year.
Now, Lou, in the market today it was another stunning list of 52- week highs, 208 of them, only seven new lows, and dividend rich sectors like utilities and tobacco just soared today help there from the dividend tax relief from Washington.
Altria, Lou, up 26 percent this week. Boeing shares rallied three percent today on news the Bush administration approved a $21 billion deal to lease Boeing transport planes as Air Force refueling tankers.
And Microsoft, Lou flat today but down six percent this week, this might be why, CEO Steve Balmer (ph) issued a statement today saying he was selling some of his holdings to diversify. He's the second-largest shareholder. He owns 470 million Microsoft shares and, Lou, the buzz on the trading desks was that was a really big sell order.
DOBBS: At 470 million shares he's got a lot of room to diversify there.
ROMANS: He certainly does.
DOBBS: Christine, thank you very much.
It's been 536 days since Enron filed for bankruptcy, 65 executives charged, 15 of them from Enron. No one is in jail.
Tonight, we conclude our special series this week on "Exporting America," the attraction of cheap labor overseas, too much for some companies to resist despite efforts to keep those jobs and to invest in plants at home.
Casey Wian reports from Los Angeles.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT (voice-over): Ace Clearwater is all about made in America producing aerospace and power plant parts but rising expenses and cost pressures from customers are forcing the company to consider moving some work to Mexico.
GARY JOHNSON, V.P., ACE CLEARWATER: One of our larger customers requires a six percent price reduction every year. Raw material is going up. The cost of labor is going up. We don't have any interest in moving our company out of the United States but we do have an interest in staying in business and that may be a requirement.
WIAN: Many competitors and customers have already gone overseas.
(on camera): Ace Clearwater used to make $8 million a year worth of these power plant ducts for General Electric but G.E. has shipped about 85 percent of that work to China and Hungary, so Ace Clearwater was in danger of having to lay off nearly half its employees.
(voice-over): Those jobs were saved recently by a military contract for Apache helicopter exhaust nozzles. Still, Mexico beckons. Government officials from Washington to Sacramento are struggling to stop job migration with programs ranging from White House tax breaks for small business to state-funded training and new manufacturing techniques.
LON HATAMIYA, CALIF. TECH. TRADE AND COMMERCE SECY." We've tried to utilize various incentive programs, whether they're tax incentives, manufacturing investment credits, R&D credits as well as industrial development bonds. We do the best we can and it is very competitive.
WIAN: One New Jersey state Senator wants to make some job migration illegal after learning a state contractor hired operators in India for a welfare program call center, Shirley Turner is sponsoring a bill to keep taxpayer funded jobs home.
SHIRLEY TURNER, NEW JERSEY STATE SENATE: When we send jobs overseas, we get no return on that money that's left our country. The people there do not pay taxes. They do not spend money. They do not stimulate our economy.
WIAN: Others stress American productivity and legal protections.
DAVID BRAUNSTEIN, CALIF. MANUFACTURING & TECHNOLOGY CTR.: I'd be a little nervous, if had a good design, to put it in China, because I would expect that it would move quickly to a lot of other companies unprotected.
WIAN: Still, lower costs persuade many companies to take the risks.
Buck Knives has been fighting to stay profitable in California. Its workers' compensation insurance and electricity bills jumped nearly a million dollars years. Buck has tried making knives in Mexico and Taiwan, where it still has limited operations. Cheap labor there helped slash prices enough to satisfy one big customer, Wal- Mart.
But the fiercely patriotic Buck family and many individual customers never liked the idea.
CHARLES T. BUCK, CHAIRMAN, BUCK KNIVES: I've got a real problem with having another country on our blades. Buck Knives is an American knife and we wanted to keep it that way. WIAN: Buck is still leaving California, but instead of 50 percent cost savings in Mexico or Taiwan, it's moving to Idaho, where it expects savings of about 25 percent.
Casey Wian, CNN, Los Angeles.
(END VIDEOTAPE)
DOBBS: Our poll question tonight comes from one of our viewers. Jim Snyder of Long Boat Key, Florida, suggested that we ask all of you this question. "How much more would you pay for products made in the USA to return jobs to America? Five percent? Ten percent? Twenty percent? Or not a penny more?"
We thought his question was terrific. We're sharing it with you. We'll find out what you think. Send your vote to cnn.com/moneyline. We'll have the preliminary results coming up in the broadcast.
(COMMERCIAL BREAK)
DOBBS: The results -- the final results of yesterday's poll. The question: "Will you respect Annika Sorenstam any less if she fails to make the cut at Colonial?" Sixteen of you said yes, 84 percent said no. It's looking like she won't make the cut and it's also looking she's made a very big favorable impression with just about everybody.
Congress has voted to extend emergency unemployment benefits for millions of Americans. The legislation would extend a program that gives job hunters 13 more weeks of aid after their state benefits run out. The current program expires at the end of this month. The bill extends that until the end of the year.
Time now for our nightly check on the trade deficit. Tonight, it stands at $197 billion, increasing at an average $1.4 billion a day.
And joining me now, the editors of the leading business magazines in this country.
Taking a look at their covers, "BusinessWeek" focusing on what's next for some thing called Yahoo!. We at AOL Time Warner always say some thing called Yahoo!, and CEO Terry Semel, who used to be some where called Warner Brothers.
And "Forbes" magazine examines how to keep your money safe in a special issue of its investment guide.
"Fortune" magazine profiling former AOL Time Warner chairman and CNN found Ted Turner.
Joining me now, Steve Forbes, the editor-in-chief of "Forbes," Rik Kirkland, the managing editor of "Fortune," Mark Morrison, the managing editor of "BusinessWeek."
Good to have you gentlemen with us.
(CROSSTALK)
DOBBS: Let me start with Steve, because it's tax cut week. You got to be thrilled.
STEVE FORBES, "FORBES": I am. Obviously, I'd like it bigger, but I think the house version, which is what mostly got through, is terrific, reducing capital gains from 20 to 15, great for longterm equity markets and getting the dividend down to 15 is a pretty good step in the right direction. Very, very positive.
DOBBS: Now you have, even before this had gone through, back this winter, had suggested to all of us at this table you that you saw 30, 40, 50 percent gains in the market. Now, with this overt governmental manipulation of the markets, how much do you expect it to rise?
FORBES: Well, it's already up 20 percent from the October lows and I think that the 15 to 20
(CROSSTALK)
DOBBS: You're not going to do that year-to-date thing?
FORBES: Well, we'll go up another 25, 30 percent.
DOBBS: All right. We're going to give you your...
FORBES: But remember my grandfather's advice. You make more money selling the advice than following the advice.
DOBBS: There you go.
(CROSSTALK)
DOBBS: Rik, with that cynical affirmation of the Forbes view...
FORBES: I don't even have options.
DOBBS: Should we feel sorry -- should we just for a second pause and feel sorry for Steve Forbes without his options?
RIK KIRKLAND, "FORTUNE:": I don't know. For those of us who have them, they aren't worked too much.
DOBBS: That's right. It's not some thing to lament, anyway.
So what do you think? Do you agree on the tax cut? Do you think it will have a significant effect?
KIRKLAND: It helps. I mean, you know, this economy is still a go nowhere economy and I think anything the government can do in the short run to put money in people's pockets and to make it -- encourage investment in the market is a good thing.
I do think that the tax cut is actually, as we all know, bigger than Steve suggests though, because if you're going to make it permanent, we're talking about at least two or three times the size that the Congress has actually passed. And I continue to worry about the sort of-- the sort of fog of mendacity that swirls around Capitol Hill over what we really are going to do in fiscal policy in this country.
DOBBS: And we've all fallen into it. As editors, as reporters, journalists, we keep talking about a $350 billion tax cut. Over what period of time? And we've just sort of stepped into it. And I think most news organizations have done it, rather than focusing on the immediate impact, which is considerably less.
MARK MORRISON, "BUSINESSWEEK": This is back to the $700 billion number and so Bush has gotten pretty much what he wanted. The sunset stuff is probably not going to set with the sun unless things dramatically change between now and three or four years ago.
DOBBS: Like the party in control of Congress?
MORRISON: Like the party in control of Congress.
But this is -- to me the big news is this is a chance to get going again, the building of the investor class that was happening in the '90s and came to a sudden stop when all the scandals broke and the bubble burst in the Internet stocks and the tech field. I think this has a real chance of rebooting that whole investor movement. And how soon that helps the economy is the big question. It will help at some point but it may take some years and we're still losing jobs. And so that's very hard on the American people.
FORBES: The impact has gone from a 201(k) to a 301(k), I think, will have a very positive impact on consumers and investors. And I think you could see the economy growing early next year.
DOBBS: Mr. Forbes is...
(CROSSTALK)
FORBES: Four to 5 percent.
DOBBS: Mr. Forbes is back to his 50 percent projection. I like that.
MORRISON: I agree with him. The economy is going grow. It's going to surprise us on the up side, I think, -- the U.S. economy is. But that doesn't mean that we're going to start creating jobs at a rapid rate again.
DOBBS: Well, that's the real issue, isn't it? Job creation in this country right now, even though we have a modest recovery under way, we're not seeing anything improve in the way of jobs.
MORRISON: Well, as your series has pointed out this week, you know, we're exporting -- we're exporting some of the better jobs in our economy just at the time when we have a shortage of new jobs being created. FORBES: What's amazing is that even in this sluggish economy, payrolls today, the number of people working today is higher than it was a year ago.
KIRKLAND: Going back to...
FORBES: We've lost some jobs. We've created jobs.
(CROSSTALK)
KIRKLAND: The problem here is really -- is really...
FORBES: It's not good but it's not quite as bleak as it...
KIRKLAND: To some extent, it's outside of our hands. You keep tracking the trade deficit in the program every night. I mean, it's not going to -- it's not going to swing unless some body else besides the U.S. can grow in this global economy. That continues to be the biggest longterm problem here is...
DOBBS: Well, we certainly wouldn't want to impose on the French and Germans to lower interest rates.
KIRKLAND: And maybe create more flexible job market over there, and maybe the Japanese finally deal with their 10-year deflation. And, I mean, we need -- we need those things to happen if we're really going to get out of this.
MORRISON: Well, the pressure is building, big time, on them with the dollar weakening the way it is. They're getting less and less competitive and they're going to have to go back to the drawing board once again and I guess none of us will hold our breath that they will make any changes. But, you know, they're going to have to look at it or they're going to just get deader and deader in the water.
DOBBS: I want to come back to that.
FORBES: What's amazing though is why they don't just print more yen. I mean, that's how you deal with deflation, just print more money.
DOBBS: Well, with that advice to the Japanese -- I've heard Americans, both government officials and media savants, like ourselves, counsel the Japanese about what they should do with their economy for the past 20 years. But they seem to be more intent on original endemic thinking.
KIRKLAND: I don't think we get a vote.
DOBBS: Exactly. Not a vote at all. But we're going to give you a vote on a host of other issues. We're going to continue with the editors of "Forbes," "Fortune," and "BusinessWeek" in just a moment.
But first, our "Though of the Day" in honor of our nation's veterans ahead of this Memorial Day holiday weekend. "It is foolish and wrong to mourn the men who died. Rather, we should thank God that such men lived." That from General George S. Patton.
We'll continue in just a moment.
(COMMERCIAL BREAK)
DOBBS: We're back with Steve Forbes of "Forbes" magazine, Rik Kirkland of "Fortune" magazine, Mark Morrison of "BusinessWeek."
Steve, I'd like to return to what you're talking about, the job situation not being as bad as it might first appear. Two and a half million jobs lost. Indeed, we have seen job creation. It's just not enough to make a net difference to those jobs being lost. What do you think needs to be done?
FORBES: I think they've taken a good step in the right direction with this tax bill. The Federal Reserve can keep the liquidity there. I think that as people realize this thing is permanent, that this recovery is for real. Then I think people will start to hire later this year and early next year. Not enough to make a dent on the unemployment rate, but certainly getting new jobs created.
But given what's happened within the last three years, it's understandable people are going to be very reluctant to make the commitment until they think it's for real.
KIRKLAND: We still are only at 6 percent. I mean that's amazing that we're at 6 percent. I remember for so many years, that was an unimaginable goal.
DOBBS: Yes. That was full employment, wasn't it?
KIRKLAND: Yes, inflation was going to pick up at 6 percent. So it's pretty remarkable.
DOBBS: One of the things that we found remarkable, and, Mark, you referred to the reports that we've been doing this week on "Exporting America" and exporting jobs. Our immigration policies are leading to just about a million people coming into this country each year, as has been the case for some time. Also a million people a year illegally coming into this country.
So even though Steve says we have some net changes, those statistics not moving into the statistics, the official statistics. What -- why is it this country doesn't have an immigration policy? Why is it we can't find a basic policy on trade? An annunciation that articulates a position on these important issues?
MORRISON: In a word, politics. I mean it's a very difficult issue for our friends in Washington to deal with. And every time you take a step forward, you rile up special interest groups, whether it be Hispanic or whatever.
And so it's been very difficult for the politicians. No up side for them to deal with it. But it's such an important thing, particularly right now. We're almost discouraging some of the very healthy immigration we had of people into our colleges and graduate schools because of the security issue.
KIRKLAND: But I think we do have a policy, generally. It's a benignly pro-immigration policy. The statistics you just mentioned speak for themselves. And I think it's a good thing. And I think it's one reason our economy continues to be so much more dynamic than more overtly anti-immigration countries like again Europe, our friends in Europe and Japan.
FORBES: What the tax debate behind us and with the Iraq war behind us, maybe we can get again with Vincente Fox of Mexico and try to get some rationalization of having work programs where people come in identified for a certain period of time and the go home. Instead of relying on illegals, bring in above-grounds, I think the president wanted to do a year or two ago.
DOBBS: And as a result of some personal animosity that developed at least briefly between the two presidents, that was forestalled.
Let's turn to the dollar because we're talking about John Snow just before the break. The treasury secretary considered a buffoon about three weeks ago when he was making several, quote unquote, "misstatements" about the dollar. Suddenly, he's revealed as a genius because he's found a new way to value the dollar. Do you think he's got it figured out?
FORBES: Talk about spin. They've come up with it. He's tried to do with the language what Greenspan does so well. I'm not quite sure he's mastered Greenspan speak yet.
But talking down the dollar, I think, hurts the markets. It's one thing if the yen changes or the euro changes because of central bank policy. When it looks like you want a devaluation overtly, people pull back from your financial markets and it hurts the stock market.
KIRKLAND: In terms that we can this around this table, we can say, you know, actually, the U.S. could use a little weaker dollar, which it's gotten. That's part of why one doesn't have to worry about deflation. It part of why we balance out trade deficit and so on.
But you don't want the treasury secretary saying that, because as Steve says if you get any doubt that you're committed to a strong currency, then you exacerbate that run. And that's what people have worried about.
But the truth is, there's nothing wrong with the dollar where it's at.
MORRISON: (UNINTELLIGIBLE) the administration's very happy to have this weakened dollar and it's one of the best things we've got going for the U.S. economy and even the jobs issue we're talking about. Some of the manufacturing -- the pressure on manufacturing jobs in this country is removed by our weak dollar. You may even have some of the Europeans and Asians doing more manufacturing in their auto plants and so forth in the U.S. if the dollar stays at these kinds of attractive levels from a competitive standpoint.
(CROSSTALK)
FORBES: ... in terms of the hurting the financial markets really was damaging. And what was happening was the dollar was going down anyway, before he opened his mouth. That was already taking place. Now he's raised doubts. Are we going to engineer another devaluation? So people pull back a little bit.
KIRKLAND: Exactly. So slam that tape in your head and just say the same thing over and over again and stop trying to speak the truth.
(CROSSTALK)
MORRISON: He didn't rattle the markets that much. I mean, the dollar's been moving gradually down...
(CROSSTALK)
DOBBS: Quick forecast, positive on the market for the next -- we're going to make this really short-term -- for the next month.
FORBES: Positive.
KIRKLAND: Up a little.
MORRISON: Positive. Strong.
DOBBS: This is the strongest possible indicator we could have on short-term performance of the equities markets right here.
Mark Morrison, Rik Kirkland, Steve Forbes, gentlemen, good to see you. Have a great weekend.
A reminder now to vote in our poll tonight. How much more would you pay for those products made in the USA to return jobs to America? Five percent, 10 percent, 20 percent, not a penny more. It sounds almost lyrical, doesn't it? Cast your vote at cnn.com/moneyline. We'll have the preliminary results for you in just a few minutes.
"Our CEO of the Week" maintains an impressive growth rate by relying on innovation, an industry that requires constant change in order to keep pace. Medtronic is a leader. The company's leader, Arthur Collins, "Our CEO of the Week."
(BEGIN VIDEOTAPE)
DOBBS (voice-over): Medtronic made the first pacemaker 46 years ago. Today, it has more than $7 billion in sales. Art Collins spends a lot of that money on research and development. Products less than two years old now produce two-thirds of Medtronic sales. ARTHUR COLLINS, CHAIRMAN & CEO, MEDTRONIC: We're fortunate in that we currently are positioned in very large growth segments, that if we continue to execute well, offer us the ability to grow and meet our stated long-term corporate objectives of a minimum of 15 percent top and bottom line without acquisitions.
DOBBS: The core of its business, the defibrillator that regulates the heart beat of this famous patient. Medtronic is also a top brand in vascular, diabetes and spinal surgery markets.
The company's had its missteps as well. Nearly two years ago, Medtronic lost a patent battle to rival Boston Scientific on a stent design and was forced to stop selling it.
COLLINS: We've got the strongest pipeline that we've had in history. We have new products to treat congestive heart failure, which is one of the most costly medical problems in the United States. New products to treat sudden cardiac arrest. We have new products to treat neurological and spinal disorders, new insulin pumps to treat diabetes.
DOBBS: One element of the company's success, its corporate governance. Collins presides over ten completely independent directors including the lead director who acts as an ombudsman to the board.
COLLINS: In addition to me being the only insider on the board, even though I'm chairman of the board, I sit on no standing committees. I ask the executive committee and every other committee of the board to meet in executive session without me there so it if there's anything that they would like to discuss, they can.
(END VIDEOTAPE)
DOBBS: Congratulations to Medtronic and Arthur Collins, "Our CEO of the Week."
Still ahead here, the latest on Annika Sorenstam at the Bank of America Colonial Golf Tournament in Texas. She's on the 17th. And we'll be heading ready back after the break.
Racing into history, one of the most celebrated champions in American history driving in his final race this Sunday. Michael Andretti joins us.
And "Your Thoughts" on "Exporting America." We'll share some of "Your Thoughts" and e-mails when we continue. Stay with us.
(COMMERCIAL BREAK)
DOBBS: We're going to Josie Karp out at the Colonial. Annika Sorenstam on the 17th. No chance of her making it, Josie?
KARP: Well, you never say never because it might come back to haunt you, but it would probably take divine intervention right now for her to make the cut. As you said, she's playing 17 right now, and through 16 complete holes, she's still five over for the tournament, even though the projected cut line is one over. It looks like she won't make that. What we're really waiting for now, Lou, is to see just what kind of reception she gets as she comes home here. When she came up 18, it was her ninth hole yesterday, she got a huge ovation from the crowd. It's likely to be the same thing as they say good-bye to Annika Sorenstam on this day -- Lou.
DOBBS: I'm sure she'll get the salute she deserves from that crowd and everybody else. Josie Karp, thank you very much.
Michael Andretti is about to take a professional turn, advancing, if you will, from driving racing cars to managing his own team. Michael Andretti is the third winningest open wheel driver in history. His record is second only to A.J. Foyt and a fellow by the name of Mario Andretti. Thirty-four years ago, Mario won the Indianapolis 500. Michael has yet to win that race, but he'll be giving it his best shot this weekend before he retires from driving. Michael Andretti joins us now from the Indianapolis Speedway. Good to have you with us.
MICHAEL ANDRETTI, RACE CAR DRIVER: Thank you. It's great to be here.
DOBBS: Why did you decide to make this the final run?
ANDRETTI: Actually, it was around January of this year, when I was doing a test and, you know, after the test that went very well, and I thought, you know what, I'm going to continue, I'm going to drive. But then, a week later, I realized I hadn't even thought about being in a race car or discussed anything with my engineers or anything, because I was so distracted with the ownership thing. So after that, I decided, you know what? That's not fair to my driving. If I can't give it 100 percent focus, and so that's when I decided, you know, I want to do it, I want to do Indy one more time and then I'm going to finish it there.
DOBBS: So many drivers competing are over the age of 40. NASCAR drivers, more than half of them. Why so young, giving up the wheel?
ANDRETTI: Well, for one, open wheel racing here is really becoming a lot younger, you know. If you look at the average age in the field, it is quite young now. And to keep up that drive and to keep up all that and to also own a team and run that, it's just -- it will be almost impossible to do. And I'm just really ready to take on my new challenge of the ownership in the team and try to make Andretti Green Racing bigger and better than it is now.
DOBBS: Well, we wish you the very best in that, Michael. As you look back over your racing career, your driving career, what is the most fulfilling of your victories?
ANDRETTI: Has to be Laguna Steak (ph) in 1991. It's a weekend where I won everything you can win, from starting on poll, leading every lap in the race. Won the race, won the championship. And my dad, who was my teammate at the time, finished on the podium with me. And it was just a storybook day, and, you know, it's one of those that is going to stay with me forever.
DOBBS: Now, let me see if I get this right. You're retiring from driving, yet you had your dad in the car. Can you explain that? I was talking to your dad here just a few weeks ago about that. What's the deal here?
ANDRETTI: Well, first of all, these parents, you give them the key to the car and they go out and wreck things, you know. It was a really unbelievable day up until the accident. We needed a little help, we needed to have somebody ready to qualify Tony Kanaan's car, because Tony Kanaan broke his arm at (UNINTELLIGIBLE). Just in case he couldn't qualify, we needed a backup, and we discussed it with dad, and he thought, well, why not, I'll give it a try, so he came to Indy and gave it a test, and was doing very well, had the biggest smile I've seen in years on his face, and everybody on the crew felt the same way, and it was just such a good day. And then, unfortunately, he had that accident where it wasn't his fault. It just was a freaky deal. And you know, it was just -- the rest is history. But it was an unbelievable day.
DOBBS: And fortunately, and almost unbelievably, he came out of that unscathed. Michael Andretti, we wish you all the luck in the world.
ANDRETTI: Thank you very much.
DOBBS: ... in this weekend's race, and we know you'll be absolutely superb as you pursue the new career.
ANDRETTI: Thank you.
DOBBS: .. the driving team. Michael Andretti.
Coming up next, the preliminary results of our poll. We'll share some of your thoughts about our series, "Exporting America." We'll be right back.
(COMMERCIAL BREAK)
DOBBS: The preliminary results of our poll. The question, how much more would you pay for products made in the USA to return jobs to this country? Seven percent said -- 5 percent, 30 percent, 10. Altogether, 24 percent of you said not a penny more. That means that three-fourths of everyone voting said they'd pay to keep jobs in this country. Look out Wal-Mart.
Now, a look at some of your thoughts on exporting America. Frank of Racine, Wisconsin wrote to say: "For too long, our representatives have only been listening to Wall Street while ignoring Main Street. Why not expose offshore corporate entities fro the frauds they perpetrate on the American taxpayer and worker."
Archie from Gainsville, Missouri: "They white collar workers have finally woke up to what us brown baggers have been saying for the last 25 years. They blamed everything from the unions to the environmentalists for moving jobs out of the country, when it was just plain greed."
Kenneth Yerty of West Covina, California: "How about exporting the jobs of all our U.S. lawmakers who favor exporting American jobs?"
Wayne Pinkham of Bristol, Connecticut was outraged. He says: "I cannot believe that my own government has created a situation where I am not discriminated by my race, religion, veteran status, sexual preference, sex or age, but by being a citizen of the United States."
And Larry Glickman of Stuart, Florida, had a great idea for CEOs who are interested in raising productivity by outsourcing to foreign countries: "I'm sure," he says, "many Indian business school graduates would be thrilled to take the CEO jobs of U.S. corporations. They would work for $200,000 or less, not $20 million, and would be hard pressed to do a worse job than U.S. CEOs."
An interesting concept. We'll see if you get any takers. E-mail us at loudobbs@cnn.com. Thanks for being with us. For all of us here, have a very pleasant weekend. Good night from New York. "LIVE FROM THE HEADLINES" with Daryn Kagan coming up next.
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