|
CNN LOU DOBBS MONEYLINE
Martha Stewart Indicted: What Does This Mean For Her Empire?
Aired June 4, 2003 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: This is LOU DOBBS MONEYLINE for Wednesday June 4, here now Lou Dobbs.
LOU DOBBS, HOST: Good evening everyone.
The Middle East one step closer to peace thanks to President Bush, in an historic meeting in Jordan the president convinced Ariel Sharon to commit to a Palestinian state. The president also received a commitment from Mahmoud Abbas to end the attacks against Israel, Senior White House Correspondent John King reports.
(BEGIN VIDEOTAPE)
JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT (voice-over): Dramatic first steps toward reviving the Israeli-Palestinian peace process and the president voiced hope this time it will reach the end of the road.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: All here today now share a goal. The Holy Land must be shared between the state of Palestine and the state of Israel.
KING: Both the Israeli and Palestinian prime ministers embraced the president's so-called road map for peace and pledged at this summit to meet its immediate tests.
Prime Minister Sharon's promises include quickly dismantling settlements built since March, 2001, and support for a provisional Palestinian state, which would require a significant Israeli military pullback but he also made clear his skepticism.
ARIEL SHARON, ISRAELI PRIME MINISTER: There can be no peace, however, without the abandonment and elimination of terrorism, violence, and incitement.
KING: Palestinian Prime Minister Abbas promised aggressive efforts to end violence against Israelis and urged militants to lay down their arms and renounce violence.
MAHMOUD ABBAS, PALESTINIAN PRIME MINISTER (through translator): We will exert all of our efforts using all our resources to end the militarization of the intifadah and we will succeed.
KING: Summits are carefully scripted though not every handshake is picture perfect. Mr. Bush hopes the summitry lifts Mr. Abbas' standing back home and the White House wants help from Jordan's King Abdullah and other Arab leaders in making the case, Mr. Abbas, not Yasser Arafat, is the man who can deliver a Palestinian state.
All on hand in Jordan know the more difficult road map challenges come later, an Israeli pullback to September, 2000 lines, more Palestinian political and security reforms, and an independent Palestine by 2005.
Mr. Bush will send a new Mid East envoy immediately and says National Security Adviser Condoleezza Rice will be his personal representative in the peace process.
BUSH: And we expect both parties to keep their promises.
KING: Keeping those promises will require a trust not evident when the summit began, when the two prime ministers refused a request to shake hands.
But there was a quick handshake later and it had been two and a half years since the United States was in the middle of Middle East peacemaking, so the president left convinced peace is a possibility.
(on camera): Upbeat after the summit talks, the president told reporters he believes there's an opening for peace now because both sides are "sick and tired of death." But the president also said it is critical that the Israelis and Palestinians deliver on their summit promises within days, or as Mr. Bush put it, "The trust is going to come from performance."
John King CNN Aqaba, Jordan.
(END VIDEOTAPE)
DOBBS: In this country, a day of stunning developments in the Martha Stewart scandal, a federal grand jury indicted Martha Stewart on charges related to an alleged insider trading stock scandal. Prosecutors say Stewart committed perjury, obstruction of justice, and engaged in securities fraud. Her attorney suggested the government has a hidden agenda and vowed to fight those charges.
Peter Viles reports.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CORRESPONDENT (voice-over): High noon for Martha Stewart, a date at federal court in a driving rain to face indictment and arraignment. The charges, when federal investigators asked why she sold her ImClone shares she allegedly cooked up a bogus alibi.
JAMES COMEY, U.S. ATTORNEY, NEW YORK: This criminal case is about lying, lying to the FBI, lying to the SEC, and lying to investors. That is conduct that will not be tolerated by anyone. Martha Stewart is being prosecuted not because of who she is but because of what she did.
VILES: Specifically, Stewart charged with making false statements, obstruction of justice, securities fraud, the alleged fraud that she lied to the public about ImClone to protect her own company, Martha Stewart Living OmniMedia, a key allegation that she altered her phone logs to cover her tracks.
Appearing briefly in court, flanked by her lawyers, she pled not guilty to all charges, was freed without bail, and refused comment. Her old broker, Peter Bacanovic, formerly of Merrill Lynch, charged with making false statements, making false documents, perjury, obstruction of justice, a key allegation he allegedly altered his notes to backup the alibi that he and Stewart made up. Bacanovic also pled not guilty to all charges.
Stewart has always claimed she had standing orders with Bacanovic to sell her ImClone shares if they fell below $60. The government says that's a lie. There was no criminal charge of insider trading but the SEC accused Stewart of insider trading in a civil lawsuit charging she dumped her ImClone shares only after she was tipped off to something the public did not know, that Sam Waksal was dumping his ImClone shares.
WAYNE CARLIN, SEC: Immediately upon learning of the Waksal selling, Martha Stewart went ahead in the same phone conversation and dumped her own holdings of ImClone stock. That was illegal insider trading.
VILES: Stewart's lawyers came out swinging in a statement: "Why has the government after nearly a year and a half chosen to file these charges? Is it for publicity purposes because Martha Stewart is a celebrity? Is it because she is a woman who has successfully competed in a man's business world? Or, is it because the Department of Justice is attempting to divert the public's attention from its failure to charge the politically connected managers of Enron and WorldCom?
(END VIDEOTAPE)
VILES: Now, the SEC wants Martha Stewart removed as a director of her own company, also wants to limit her executive role there, but the government can not easily take away her main source of power. She owns more than half of the company outright and she controls 94 percent of the voting stock and that's true whether she is innocent or guilty -- Lou.
DOBBS: Pete, thank you very much, Peter Viles reporting.
Martha Stewart today became the 67th executive in corporate America to be charged since the corporate corruption scandals began a year and a half ago. Her broker Peter Bacanovic, from Merrill Lynch, is the 68th.
Two others have already been charged in the scandal, Sam Waksal, the founder and former CEO of ImClone, and Doug (unintelligible) who was Bacanovic's assistant pleaded guilty last year as part of a deal to testify against Stewart. Sixteen executives from Enron have been charged. Still, no one has gone to jail. It's been 548 days since Enron first filed for bankruptcy. We turn now to our "Quote of the Day" which tonight is fittingly on the subject of honesty. "Whether untruths are on the rise or have always been the human lot, dishonesty is a thief of time, of energy, of pride. We must remember and teach our children and perhaps our political figures one essential, the truth shall make you free." That quotation, perhaps surprisingly, comes from Martha Stewart herself. It's from a 1992 edition of "Martha Stewart Living" magazine.
Trouble for a celebrity homemaker and a celebrity home run hitter, Sammy Sosa the Chicago Cub's slugger under fire for using a corked bat during a baseball game last night. He says it was all a mistake but the incident has given Major League Baseball another black eye and it could tarnish Sosa's career.
Keith Oppenheim is in Chicago tonight, Casey Wian in Los Angeles, first to Keith for the latest developments in this story in Chicago -- Keith.
KEITH OPPENHEIM, CNN CORRESPONDENT: Lou, it's really developing drama here at Wrigley Field. Major League Baseball says the X-rays on the bats that were taken away from Sammy Sosa's locker, the results of those X-rays will be released before the game tonight here at Wrigley with Tampa Bay.
So, that could have some impact on whether or not Sammy Sosa will play. Dusty Baker, the manager, says that he is in the lineup. It's been quite a 24 hours here in Chicago and for Sammy, yesterday he was just a slugger in a slump. Today, he's on the hot seat.
(BEGIN VIDEOTAPE)
OPPENHEIM (voice-over): For a man with 505 home runs, it's ironic a ground ball would put his career and image in jeopardy but so it was for Sammy Sosa in the first inning at Wrigley against Tampa last night after Sosa cracked his bat.
A closer inspection revealed something illegal on the inside because it makes bats lighter, cork. Sosa was ejected. He later admitted to using a cork bat in batting practice and during the game he says he accidentally picked that bat up on his way to the plate.
SAMMY SOSA, CHICAGO CUBS: It's a mistake. I know that. I feel sorry. I just apologize to everybody that I embarrassed.
OPPENHEIM: Some are ready to accept Sosa's story, his manager.
DUSTY BAKER, CUBS MANAGER: Deep down in my heart I truly believe that Sammy didn't know that that was in there.
OPPENHEIM: And there are fans, hard to say how many, who for the moment are in Sosa's corner.
UNIDENTIFIED FEMALE: We're just hoping that he's telling the truth and hoping that the rest of the bats all come up clean.
OPPENHEIM: The rest of Sosa's bats were taken away from his locker for further examination by Major League Baseball officials. In Chicago, the Cubs' president said it's too soon to say Sosa's previous achievements are tainted.
ANDY MACPHAIL, CHICAGO CUBS PRESIDENT: So, I think those that try to jump to the conclusion that all of the numbers are tarnished are not being objective.
OPPENHEIM: The results will impact how long Sosa could be suspended from the game and whether fans will ultimately view him as a champion or a cheat.
UNIDENTIFIED MALE: There is no room for cheating. I mean he's powerful enough. What does he need this for?
(END VIDEOTAPE)
OPPENHEIM: "Sports Business Weekly" recently called Sosa baseball's most marketable player. Well, if the situation against him gets worse, Sosa may be less marketable and more notorious -- Lou, back to you in New York.
DOBBS: Keith, thank you very much, Keith Oppenheim at Wrigley Field.
Corked bats are nothing new in baseball but the company that made Sammy Sosa's bat and other manufacturers say they have nothing at all to do with the corking of these bats. Casey Wian has that part of the story for us tonight from Los Angeles.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT (voice-over): The company that made Sammy Sosa's now infamous bat is run out of a Los Angeles suburban house. Jack Kasarjian's X-bats are maple instead of the traditional ash. His two-year-old business is thriving in part because of Sosa's success early last season.
JACK KASARJIAN, PRES., TUFF BATS: We made him a couple. The second week of the season he wound up hitting four home runs in two games down in San Diego and ordered three dozen right after that and it took off amongst the major leaguers.
WIAN: Now, the X-bat, which is manufactured in New York has 161 Major League customers. But this season, Sosa signed an endorsement deal with another bat maker, Easton and stopped using the X-bat.
KASARJIAN: Two weeks into the season he's in a one homerun in 13 game slump and he breaks out the X-bat on April 14 and hits six home runs in eight games with an X-bat. I hadn't talked to him until last Saturday when he called and ordered more bats and, of course, we were going to start putting them into production yesterday when all of this happened.
WIAN: From photos of the incident, Kasarjian says it's clear Sosa's bat was modified even before it broke. KASARJIAN: You can see where the handle has been sanded. The stain has come off and it's not at the normal break, which is right below the label for the two-tone colors.
WIAN: Corking involves drilling a deep hole lengthwise through the barrel of the bat, stuffing it with cork or other light dense material, then plugging and refinishing the end. The goal is to make a bat lighter or springier. Manufacturers say they don't cork bats for players.
CHUCH SCHUPP, LOUISVILLE SLUGGER: We've actually tested that theory. We've corked bats and hit with them on hitting machines and really all the work you put in it doesn't make that much difference as far as distance travel with the ball because you're lowering the mass of the bat.
WIAN: Even so, Sosa is at least the sixth Major League player caught with a stuffed bat since the mid-1970s. He's also the most famous.
(END VIDEOTAPE)
WIAN: How that will impact his reputation and endorsement income is unclear. Both Easton and X-bats say they hope to continue their relationship with Sosa after Major League Baseball resolves the issue -- Lou.
DOBBS: Even if he was cheating, Casey?
WIAN: Absolutely, even if he was cheating. You know there's a lot of history here. Some of the players who have been caught cheating in the past that we showed up there on the screen, for example Billy Hatcher (ph), he's a coach for the Tampa Bay Devil Rays and he was playing against Sosa last night, his team was.
DOBBS: Well, it's perhaps something that Major League Baseball ought to examine, the economics as well as the ethics.
WIAN: Absolutely.
DOBBS: Casey, thanks very much, Casey Wian reporting from Chavez Ravine, Dodger Stadium.
Tonight we continue our series of special reports this week on "Vanishing Retirement." Dwindling 401(k) plans are forcing many people to put retirement on hold and to reenter the workforce.
Jan Hopkins talked with one couple that's reinventing their retirement out of necessity.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: I have an eight o'clock coaching call from home.
UNIDENTIFIED FEMALE: I have a 10:30 -- 9:30 coaching call. UNIDENTIFIED MALE: We can do it from 7:00 to 8:00.
UNIDENTIFIED FEMALE: That would be great.
UNIDENTIFIED MALE: Yes, let's do it from 7:00 to 8:00.
UNIDENTIFIED FEMALE: OK.
UNIDENTIFIED MALE: Yes, because that -- actually, I'd be happy to get to work early.
JAN HOPKINS, CNN CORRESPONDENT (voice-over): Michael Brenner is 68. His wife Roberta is 58. They're still working even though they had planned to retire by now.
MICHAEL BRENNER, BRENNER EXECUTIVE RESOURCES: The amount of assets we had three years ago would have been sufficient that we didn't have to work at all but all of a sudden it dropped below the threshold and we really needed to work.
HOPKINS: Michael Brenner is in good company. The National Council on Aging finds 43 percent of people over 65 are working full or part-time. In large part that's because they can't afford to quit.
And, according to an Employee Benefit Research Institute study, one-quarter of all workers 45 or older plan to delay their retirement date mostly for financial reasons.
Alicia Munnell of the Center for Retirement Research at Boston College says in her new book that Americans are coming up short.
ALICIA MUNNELL, BOSTON COLLEGE: If you look at the amount of money people have in their 401-type accounts of people just approaching retirement the typical amount is not very much. It's a little bit more than $50,000. So, to the extent that people think they're going to get a substantial retirement income out of that, they're going to be severely disappointed.
HOPKINS: Even the man who invented the 401(k) back in the '80s is still working at 62.
TED BENNA, PRES., 401(K) ASSN.: One of the reasons that I haven't retired myself is that I realize that it takes a very large nest egg to be able to spend 20 to 30 years in retirement and personally, you know, I've worked all my life. I don't want to do that.
HOPKINS: The Brenners have made going back to work for them. They now work together in Roberta's executive search and coaching business which she started at age 53. The Brenners say returning to work has its rewards beyond paying the bills.
ROBERTA BRENNER, BRENNER EXECUTIVE RESOURCES: Sometimes we look at each other and say we're too old to be working this hard and other times we come home at the end of the day, or I work at home often, and say it was a great day, really rewarding. So, it has been a blessing in disguise.
(END VIDEOTAPE)
HOPKINS: Blessing in disguise or a new way of life, working well into retirement age is becoming more and more common in this country. It explains what has happened to some of the Americans who lost $3 trillion in the market decline -- Lou.
DOBBS: That's a big part of this story as well. Baby boomers approaching retirement age, what's the word there?
HOPKINS: Well, baby boomers say that they, about 70 percent of them say that they're planning to work during their retirement so they're looking at these figures and saying we have to keep working.
DOBBS: Again, a good part of that the bursting of the bubble.
HOPKINS: That's right.
DOBBS: Jan, thank you very much, Jan Hopkins.
Well, tomorrow in our series of special reports, "Vanishing Retirement," we look at how American retirement plans compare to plans in other countries. We actually went out there to look to see whether or not there might be a better idea in retirement systems. Kitty Pilgrim will have that report for us here tomorrow evening.
Still ahead tonight, more on today's groundbreaking summit in the Middle East, Congressman Darryl (unintelligible) will return from the region. He's returned from the region and he will join us to share his thoughts.
And, more controversy about a proposed nuclear waste site, a highly radioactive waste site at Yucca Mountain, Nevada. Two U.S. Senators cry foul saying the Department of Energy is not behaving appropriately. Senator Harry Reid and Senator John Ensign of Nevada join us. Stay with us.
(COMMERCIAL BREAK)
DOBBS: On Wall Street today, a powerful rally, lifting the Dow, the S&P 500 to new highs for the year, the market up for a ninth time over the past ten session, the Dow up 116 points and flash. Look at that Dow, 9,038.98, the NASDAQ adding 31 points, the S&P 500 up 15.
Christine Romans is here. Christine, it's been a while since we saw Dow 9,000.
CHRISTINE ROMANS, CNN CORRESPONDENT: It really has and now you're looking at last summer to find any kind of levels for the Dow and the S&P that we've closed above like this.
In ten days this rally has taken the S&P up seven percent, the Dow up more than six percent in that period and, Lou, the market indicators remain strong. Three stocks rose at the big board for each that fell. Three hundred thirty-five stocks hit highs for the year, only three new lows, and meanwhile big board volume almost reached 1.6 billion shares.
Lou, NASDAQ volume topped two billion shares for the sixth day in a row. That hasn't happened since March, 2000, yes. Meanwhile, treasuries rose with stocks, the yields trekking to the low end of their recent range, the two-year yield again below the Fed funds rate.
And, Lou, in stocks the skeptics have been looking for this spring rally to peter out. They've been wrong so far and a look through history shows that when May is up, 65 percent of the time the market rises June through September, and when May is up and the summer is also positive, 85 percent of the time the market is higher for the year. So, the trend seems to favor those who have been holding on to stocks there.
DOBBS: The trend is your friend, sounds like historical momentum there for the market.
ROMANS: Historical momentum.
DOBBS: Do you like that?
ROMANS: I like it.
DOBBS: Well, this market is starting to show some signs of vigor as they say.
ROMANS: It really is.
DOBBS: And a 9,000 Dow, that's starting to get impressive again, isn't it?
ROMANS: It had a little bit of trouble staying above 9,000 the last couple of times it tried to make it there but today it stuck right on there and the market closed at the highs.
DOBBS: Well, this would be boring if it just moved in a straight line, right?
ROMANS: Yes, exactly.
DOBBS: Christine, thanks, Christine Romans.
ROMANS: You're welcome.
DOBBS: Time now to check, as we do nightly, the national debt. By our calculations it stands at more than $6,600,000,000,000 and, of course, rising.
Coming up next Hillary Clinton's new book at the center of a battle in the publishing world.
And, the new rules that make big media even bigger, facing a serious challenge now on Capitol Hill.
And, allegations of intimidation and scandal now swirling around a controversial proposal for the nation's proposed highly radioactive nuclear waste dump in Nevada, we'll be talking with two U.S. Senators, that and more still ahead. Please stay with us.
(COMMERCIAL BREAK)
DOBBS: We talked with the editors of "TIME" magazine and they tell us they have no comment on reports that "TIME" magazine will drop its plans to run excerpts from Senator Hillary Clinton's new book "Living History," that after the Associated Press beat "TIME" magazine to the punch in releasing excerpts. "TIME" magazine paid for the privilege, the Associated Press running stories today extensively quoting the book which is to be published next Monday.
Among some of the quotes, Hillary says referring to Monica Lewinsky, "I was dumbfounded, heartbroken and outraged that I'd believe him at all. As a wife, I wanted to ring Bill's neck."
"TIME" bought the rights to excerpt the book from publisher Simon and Schuster. Simon and Schuster is reportedly suing the Associated Press for quoting the as yet unpublished book.
The AP admits there has been a meeting of attorneys from both sides and that in the words of the Associated Press they disagreed. As to how AP got those excerpts, a spokesman would only say: "We obtained the book through good old-fashioned reporting."
The proposal to dump the nation's nuclear waste at Yucca Mountain, Nevada, has created a firestorm of controversy from the outset. Now, two U.S. Senators are accusing the Department of Energy of covering up mismanagement and intimidating critics of the proposed highly radioactive waste site.
The two join us now from Capitol Hill. They are Senator Harry Reid and Senator John Ensign, gentlemen good to have you with us.
SEN. JOHN ENSIGN (R), NEVADA: Good to be with you.
SEN. HARRY REID (D), NEVADA: Thank you very much.
DOBBS: You held hearings last week. In those hearings, did you discover anything that you did not already know about the design and the operation of the plant?
REID: I was stunned by people who favored Yucca Mountain. Senator Ensign and I do not favor it but the witnesses that we had favored Yucca Mountain but yet they came forward with what I thought were revealing statements about how the science was bad there, there was money wasted there.
And, the most obnoxious thing that I found is that they intimidated witnesses from coming and testifying at our hearing. Your viewers should understand that Yucca Mountain is not a Nevada problem. It's a problem this nation has. It involved the health and safety of people in this country.
ENSIGN: Lou, we're talking about the deadliest substance known on the planet, nuclear waste, and the scientists want to make sure that when the project is built, it's built to the strictest quality assurance standards and that's really where this whole problem has come to now is that the scientists who are complaining that the Department of Energy is skirting the standards is not using good science.
Those scientists are being intimidated. We called them to testify. They originally wanted to testify. All of a sudden when the hearing was called they made some excuses and the Department of Energy sent us a letter and you could tell in the letter that the Department of Energy was embarrassed by what was going on and they did not want them to testify. So, this needs to be looked into very, very seriously and that's what Senator Reid and I are in the efforts of doing right now.
REID: Lou, one of the things...
DOBBS: If I may, Senator, I just want to point out before if I may, and I should have done this at the outset, Senator Reid obviously a Democrat of Nevada, Senator Ensign a Republican of Nevada. Senator Reid, I apologize.
REID: Lou, what we've done, and thank you for laying the foundation of this, we are sending tonight to secretary -- I'm sorry to Attorney General Ashcroft a letter, a bipartisan letter signed by Senator Ensign and me. This letter is saying we want you under all the laws that are effective in this country to allow us to examine those witnesses.
We've got whistleblower statutes. There are statutes relating to intimidation and we have a written a letter to him and we're going to deliver that tonight saying we need you, John Ashcroft, to do the fair thing and have these witnesses testify. Intimidation should not work in America.
DOBBS: You both, Senator Ensign, Senator Reid, you both say that that intimidation influenced at least two witnesses, one Robert Clark, Department of Energy employee who did not testify, Donald Harris, a Navarro employee which is a consultant, an engineering consultant on the project did not testify. In both instances, am I correct you believe that there was intimidation of these men preventing them from testifying?
ENSIGN: Yes. I think that based on the other witnesses' testimony there seems to be good reason why they would be intimidated. We had a professor from MIT that would testifying that scientists all over the country are afraid to say anything negative about the Yucca Mountain project for fear of losing grants from the federal government.
So, there is this almost atmosphere around this Yucca Mountain project that they want it to go forward no matter what, no matter what the science, no matter how poor the science is, and because of that they'll do anything it seems to intimidate, make sure that the science comes out exactly like they want regardless of what the experts are saying. And these, remember these are experts who are for the Yucca mountain Project. They believe in it. They just want to make sure the science is done right. And so when they point something out wrong, they should have a lot of credibility, but they're not allowed to get that word out.
REID: I would also say, Lou, if you just give me a second here.
DOBBS: You bet.
REID: I have spoke to these two witnesses, proposed witnesses. I've spoken to them. Of course they wanted to testify. They are afraid of losing their jobs. This is something that the taxpayer should be concerned about. This is a project that could cost as much as 100 billion, not million, $100 billion. I think it's time that we got fairness involved in this, and have an open book so that the American taxpayer knows what's happening.
DOBBS: Well, Senator Reid, Senator Ensign, we thank you both for letting our viewers know what's happening. We thank you both for being here tonight. Thank you, gentlemen.
REID: Thanks for your interest.
DOBBS: Fireworks today on Capitol Hill. The issue again media ownership. Several senators blasted the Federal Communications Commission for its decision this week to ease ownership rules. Louise Schiavone joins us now from Washington with the story -- Louise.
LOUISE SCHIAVONE, CNN CORRESPONDENT: Lou, there are some bipartisan efforts under way in Congress to return ownership restrictions to the old threshold, 35 percent of the national audience. The new FCC limit has been bumped to 45 percent of potential viewers. The charge from a broad range of philosophical and political interests is that the rule changes are a victory for big broadcasting and a defeat for diversity. Opponents in the U.S. Senate today got their first whack at the FCC and its chairman, Michael Powell.
(BEGIN VIDEO CLIP)
SEN. BYRON DORGAN (D), NORTH DAKOTA: Would you not agree with me that today those who most aggressively celebrate your decision are the biggest economic interests in broadcasting in this country?
MICHAEL POWELL, CHAIRMAN, FCC: I have no idea who's celebrating our decision.
DORGAN: You really don't? are you kidding me?
(END VIDEO CLIP)
SCHIAVONE: Under the new FCC rule in the largest local markets it will be possible for an owner to control three TV stations. In most of the smaller markets the limit would be two. It would also be much easier to own a television station and a newspaper in the same local market. Chairman Powell insists that's a good development.
(BEGIN VIDEO CLIP)
M. POWELL: Newspaper-owned television stations produce 50 percent more local news than non-newspaper-owned stations. We also found when we looked at quality awards for excellence in the news industry, RTNDA, the project for journalistic excellence, that newspaper-owned stations often produced the highest-quality news product of the local market.
(END VIDEO CLIP)
SCHIAVONE: Senate Commerce Committee Chairman John McCain and House Energy and Commerce Committee Chairman Billy Tauzin oppose an outright roll back of the rule. However, Senator McCain wants to specify in a new authorization bill that if the public interest demands it the FCC can and should restore media ownership restrictions -- Lou.
DOBBS: I think this is a firestorm no one from the FCC to the U.S. Senate or the House was prepared for.
Louise Schiavone, thank you very much. Reporting from Washington tonight.
Martha Stewart's indictment the topic of our poll question tonight. Do you consider Martha Stewart to be a criminal, a scapegoat, a victim, or hey, it's corporate America?
Cast your vote at cnn.com/moneyline. We'll bring you the preliminary results later in the broadcast.
Now the final results of yesterday's poll. The question, "Which investigation are you most interested in?" Thirty-two percent said Zacarias Moussaoui, the 15 percent said Eric Rudolph, 28 percent said Scott Peterson 24 percent said Martha Stewart.
When we continue, a historic day on the road to peace in the Middle East. Congressman Darrell Issa will be here. He's just returned from a trip to the region. And he joins us next.
The search for weapons of mass destruction in Iraq has led to accusations and finger-pointing in Washington and in the media. The Pentagon isn't having any of it. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Our next guest has just returned from a nine day visit to the Middle East. Since the attacks of September 11 he's made eight trips to the region. He's met with Ariel Sharon, Yasser Arafat, Mahmoud Abbas, Syrian president Bashar Assad, among others.
Congressman Darrell Issa joins us now from our studios in Washington, D.C.
Congressman, thanks for being here.
REP. DARRELL ISSA (R), CALIFORNIA: Thank you, Lou.
DOBBS: It appears, it appears that there is some momentum building behind the president's initiative this time. What's your own view?
ISSA: There was a great deal of momentum. I was in the region, actually, over the Easter holiday, and there was some pessimism, will the president engage, how serious is he, what about the campaign season, that's pretty well melted away. They see a level of engagement. The president during that intervening month made phone calls directly to people all the way down to the finance minister of the Palestinian Authority. He's done a lot of things that have showed that he's going to school on this process personally and making the kind of commitment that you need to make if you're going to have the force of will in this region.
DOBBS: The two big questions here are will the Israelis withdraw settlements through negotiation to some point in time as well as geography, and will the Palestinians and terrorist groups stop their attacks against Israeli citizens?
ISSA: Lou, these are both very good questions. In fairness, there is sort of one additional question. We've had periods of time in which there was an easing of new settlements. We've had periods of time, long periods of time, in which there was very little violence. What we haven't had is a president who is committed to a viable and contiguous Palestinian Authority West Bank and minimum distance and a thoroughfare between West Bank and Gaza. That sort of viability is what makes the president's initiative very different.
DOBBS: It does make it different. Yet those two questions that I just articulated remain as the fulcrum issues, if you will, in whether this momentum that appears to be there, and we have to say appears to be there, whether this momentum can be sustained and real progress be worked out. A real Palestinian state created and real national security for Israel.
ISSA: Well, and it is a very good question. Obviously, Mahmoud Abbas has the biggest problem because he has to get control of groups that have been allowed to be out of control for a very long time. Some of it being Yasser Arafat's fault for not taking measures early, some of it being the destruction of the mechanisms, if you will, the infrastructure of a police authority. On the other hand, no Israeli prime minister has ever really taken on the settlements in a straightforward way. The closest really there was were the settlements in the Sinai.
But by comparison they had very little significance. There's 400,000 people living in the West Bank and Gaza who are Israelis. Over 200,000 of them live in and around Jerusalem. And these sites in the long run are going to be very hard to negotiate out.
DOBBS: It's all difficult, and everybody knew that going in. And I think all of the sort of clever observers, if you will, the nuance savants both in politics and media say this is going to be very difficult, it's all but impossible, yet what we've already seen is a president who said there's going to be a Palestinian state, we've seen Israeli Prime Minister Ariel Sharon actually endorse a Palestinian state, and Mahmoud Abbas say straightforwardly that he wants to see Hamas, Hezbollah and all terrorist groups lay down their weapons, their bombs, and the thought of terror. This is a very big opportunity.
What is different here that gives us a sense that there is reason for optimism in your judgment?
ISSA: I think it's the engagement of the president at the height of his power. The last time this happened was with his father, the Oslo and Madrid process was the result. Certainly, president Clinton engaged very, very strongly, but he engaged from a position of weakness, late in his administration and after some scandal. President Bush, President W. Bush, has come in at exactly the right time, a time in which the world is looking to the United States as a leader. They don't always agree with us, but right now they believe that we will do what we say we will do.
DOBBS: Congressman Issa, we thank you very much for being with us here.
ISSA: Certainly.
DOBBS: And that brings us to "Our Thought of the Day," a thought to bear in mind as these world leaders try to navigate the road to peace in the Middle East.
"We are more inclined to hate one another for points on which we differ, than to love one another for points on which we agree." That from author Charles Caleb Colton.
While many agree that Iraq possessed weapons of mass destruction, the Defense Department continues to fight criticism that evidence of WMD has yet to be found. The Pentagon once again today tried to allay those concerns. National security correspondent David Ensor reports.
(BEGIN VIDEOTAPE)
DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT (voice-over): The simple fact that eight weeks into the occupation of Iraq, U.S. forces still have not found any of the weapons of mass destruction that American intelligence predicted were there, is raising the political pressure on the administration almost daily.
REP. JOSEPH HOEFFEL (D), PENNSYLVANIA: Like millions of Americans, I'm wondering where the hell the weapons of mass destruction are.
REP. ELIOT ENGEL (D), NEW YORK: I'm deeply concerned about reports that the administration twisted the arms of our intelligence analysts to produce analysis which agree with the policies that you wanted to pursue.
JOHN BOLTON, UNDER SECRETARY OF STATE: I personally never asked anybody in the intelligence community to change a single thing that they presented. And I am not aware of any other official in this administration who did that.
ENSOR: Under Secretary of State John Bolten said finding weapons of mass destruction may take time. BOLTON: The finding of the weapons, the production means, will occur in due course. If this stuff had just been lying around on the ground, UNMOVIC would have found it.
ENSOR: But critics suspect a conspiracy to justify the war. Some dissident former CIA officers say Pentagon hawks took hearsay from Iraqi defectors around exile leader Ahmed Chalabi and presented it to the president as fact.
RAY MCGOVERN, FORMER CIA OFFICER: When Rumsfeld couldn't get the answers that he wanted from the Central Intelligence Agency, he created his own mini-CIA in the bowels of the Pentagon.
ENSOR: At the Pentagon officials held a special briefing Wednesday to respond to that charge, saying a small special plans office did analyze but never collected intelligence, and never twisted arms.
DOUGLAS FEITH, UNDER SECRETARY OF DEFENSE: See, this suggestion that we said to them, this is what we're looking for, go find it, is precisely the inaccuracy that we are here to rebut.
ENSOR: At the CIA officials say an internal review is looking at whether an October classified report, saying Iraq had chemical and biological weapons and was seeking to reconstitute its nuclear program, was based on solid intelligence.
(on camera): But the real answer to that question will await the work of the 1,400-plus member Iraq Survey Group now assembling in Baghdad. And including Australians and Britons as well as Americans, U.S. intelligence officials say they still believe that that group will find, at a minimum, Iraqi chemical weapons unaccounted for since the end of the first Gulf War.
David Ensor, CNN, Washington.
(END VIDEOTAPE)
DOBBS: Up next, perjury, obstruction of justice, conspiracy. Those just a few of the charges facing Martha Stewart. CNN legal analyst Jeffrey Toobin joins us. We'll be analyzing what lies ahead for Martha.
And SARS. The SARS virus may be on the wane, but another deadly threat is resurfacing and we'll have that report and a great deal more still ahead here. Please stay with us.
(BEGIN VIDEOTAPE)
DOBBS: As we reported earlier, Martha Stewart today indicted on nine criminal counts ranging from conspiracy to perjury related to alleged insider trading of biotech stock ImClone. Joining us now with more on the story is CNN's legal analyst Jeffrey Toobin. Good to have you here.
JEFFREY TOOBIN, CNN LEGAL ANALYST: Hi, Lou. DOBBS: This is -- this is something of a barn burner, nine indictments coming out in this.
TOOBIN: Big case. In part it's bigger and in part it's smaller. It's bigger because there was a charge that no one really expected, this conspiracy to violate the securities laws by lying to the investment public. By going public and saying I did nothing wrong, they're saying that's a separate crime because you knew you did something wrong. Very unusual charge, I've never seen it before. It's...
DOBBS: And what's the one charge that we don't see? Insider trading.
TOOBIN: Insider trading. Interestingly, we do see it in the SEC case. So the government apparently thinks they can they can prove insider trading by a preponderance of the evidence, but they can't prove it beyond a reasonable doubt. Very unusual.
DOBBS: Now, Jeffrey, as you know, we have just put up a poll question -- and these are the charges being recounted here -- but we've put up a poll question, asked what our viewers think of this.
Now, if you and I say that Martha Stewart is being (UNINTELLIGIBLE), people will say well that's because you're sympathetic to a celebrity. If you want to say she's fully prosecuted, that's because oppose women. There are all sorts of just polemical issues surrounding this, aren't there?
TOOBIN: Yes. One of the things when I first started, you know, looking into this story, I was stunned by the polarization of feelings about her. I mean there are people who just despise her on general principles. A perfectionist, a snob, someone who's imposing her will on people.
Other people view her as this successful entrepreneur who's being penalized for being a woman, for being a Democrat. Jury selection in this case is going to be so extraordinarily difficult because, you know, who knows how people feel?
DOBBS: Well, we do know this, that she saved herself about $47,000 by selling ImClone stock at the time she did, whether based on insider information or whatever. And she's lost tens of millions of dollars in her own company as a result of this assault which turns out to be, through no fault of the Justice Department or the SEC here, necessarily, it's been a huge loss for shareholders.
TOOBIN: Tremendous. She lost 300 -- when I interviewed her for "The New Yorker" she told me she had lost $300 million in stock price decline and in legal fees. It's for a $47,000 gain.
DOBBS: Well, it certainly should in no way stop the Justice Department or the SEC simply because shareholders are going to be hurt because their purpose it to protect all shareholders. But at the same time, is it a fair question, would there be this prosecutorial zeal here if she were not Martha Stewart, that is, a celebrity? TOOBIN: It's a fair question. But I think, you know, when you consider the mission of federal law enforcement, the mission of federal law enforcement is not just to prosecute, you know, people they believe are guilty, but it is to send messages, it is to draw attention...
DOBBS: Wait a minute, say that again.
TOOBIN: That you as a federal prosecutor are supposed to use the courts to send the message that everybody is to be -- has to follow the law. And high-profile targets are always pursued for just that reason.
DOBBS: And that's just the way it's done?
TOOBIN: It's the way it's done. And you know, I think it's the right thing to do. You know, publicity is one way we get people to comply with the law.
DOBBS: Is this, in your judgment, going to result in an expensive, drawn-out trial here now that we move well beyond prosecution, where does this go from here?
TOOBIN: You know, I think it goes straight to 12 citizens who are going to decide whether she's guilty and very likely whether she goes to jail. It seems like the days of plea bargaining are over. It's time for a trial, and we're going to have the most famous criminal defendant since O.J. Simpson going to trial right here in Manhattan.
DOBBS: Well, that's going to be something to look forward to for all of us. And at least the system provides resolution for all of this. This has been, people forget, over a year in the making here. Hardly swift justice.
TOOBIN: This is not the Enron case. It wasn't that complicated. A year and a half is a long time to investigate it.
DOBBS: Year and a half's a long time for Enron, too, don't you think, Jeffrey?
TOOBIN: Well, it's getting to be -- remember, when we first started talking about this, I said
(CROSSTALK)
TOOBIN: ... take your time. But you know what? This is getting to be a long time.
DOBBS: This is a long time, and nobody in all of corporate America's in jail.
TOOBIN: Jeffrey (sic) Fastow's trial not even till next year, probably.
DOBBS: Yes, well, that's why we keep a scoreboard, just so people don't lose track.
TOOBIN: And now Martha Stewart is on it. Who knew?
DOBBS: Absolutely. Jeffrey Toobin, as always, thank you very much.
A reminder to vote in our poll tonight. Do you consider Martha Stewart to be a criminal, a scapegoat, a victim, or hey, it's corporate America? Cast your vote at cnn.com/moneyline. We'll have the preliminary results coming right up.
Checking quickly on the trade deficit, tonight it stands at more than $215 billion.
Still ahead here, words of warning from the CDC about the latest virus to threaten this country.
And your thoughts about the indictment of Martha Stewart. We'll share some of your e-mails coming right up.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: For the first time since late March, we can report to you that no one in the world today died of the SARS virus. Health officials say that indicates that the illness is certainly on the decline. In Canada, nurses there protested the Canadian government's handling of the SARS outbreak. They're calling for a public inquiry. They also want better screening criteria instituted at all Canadian hospitals.
Rain-starved Texas has been drenched this week by a series of intense storms. Up to six inches of rain fell in some areas. Golfball size hail falling in other parts of Texas. Tornado warnings, flood watches posted across the state. Damage from high winds has been reported as extensive.
That wet, soggy weather could provide a fertile breeding ground this summer for mosquitos and, of course, the West Nile virus. Health officials now say the disease has a permanent home in this country and persistent rains this spring will likely make the situation even worse this summer.
CNN medical correspondent Elizabeth Cohen reports.
(BEGIN VIDEOTAPE)
ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT (voice-over): They're back, and so is West Nile virus.
Last year, according to the Centers for Disease Control, 284 people died in the U.S. of the disease and some 4,000 people were diagnosed with West Nile in 39 states. One official says he's concerned this year could be worse. There has been so much rain this spring in many parts of the United States, and mosquitoes lay their eggs in water.
Already this year, animals with West Nile virus have been found in nine states. Although animals can't pass the virus to people, you can get it from mosquitoes or tainted blood transfusions.
UNIDENTIFIED MALE: Have you heard the buzz about West Nile virus? Protect yourself and your family.
COHEN: That's why the CDC is trying to get the word out: prepare now for the West Nile virus season.
DR. JULIE GERBERDING, CDC DIRECTOR: The earlier we get into the mind frame of fighting against this infectious disease, the better off we'll be when it is the full-blown summer months and the mosquitoes are about.
COHEN: The CDC recommends: get rid of standing water in your yard; organize a mosquito control program in your neighborhood if there isn't one already; use a repellent containing the chemical DEET; wear long pants and sleeves and spray your clothing with a spray containing DEET or permethrin.
(on camera): And perhaps the most important advice of all: don't panic.
While the 4,000 cases of West Nile virus last year may sound like a lot, think about how many millions of people were bit by mosquitoes.
(voice-over): And keep this in mind: According to the CDC, 80 percent of people who get West Nile don't get sick at all; they're perfectly fine. Twenty percent have mild symptoms such as fever and headache. Less than 1 percent become severely ill.
The most vulnerable? The elderly and those with suppressed immune systems. So the best strategy? Prepare for the worst but know that chances are the worst will never happen.
Elizabeth Cohen, CNN, Atlanta.
(END VIDEOTAPE)
DOBBS: Well, we're going to quickly move to Chicago, where Major League Baseball is reporting on their findings after X-raying what we are told are 76 bats used by Sammy Sosa.
This is Sandy Alderson. He's the vice president of operations for major league baseball. He's reporting that of those 76 bats that they X-Rayed and examined that there are no indications of any kind that those bats have been tampered with. No foreign substances, no cork, no nothing. And as a matter of fact, they are praising Sammy Sosa for being, as they put it, forthcoming and cooperating with Major League Baseball.
For the life of me, I can't figure out what his choices in that matter were since the umpires found the cork bat lying broken in the infield. But nonetheless, Major League Baseball is appreciative, even grateful. And we will keep you up to date on this unfolding story and throughout the evening here on CNN.
When we continue, the preliminary results of tonight's poll. And we'll share some of your thoughts about Martha Stewart's indictments.
Stay with us.
(COMMERCIAL BREAK)
Our poll question tonight: "Do you consider Martha Stewart: a criminal, a scapegoat, victim, or Hey, it's corporate America?" Thirty percent of you said criminal; 46 percent said scapegoat; 9 percent victim; 15 percent said Hey, it's corporate America.
Now for a look at some of your thoughts.
On Martha Stewart's indictment today, Linda Kent of Ontario wrote: "How swift the Justice Department is to move on. Not only are they lynching Martha, but they're punishing the shareholder as well. When shall we see the persons indicted and jailed on the real crimes of Enron, Global Crossing and WorldCom?"
And, on vanishing retirement, Ruth of Montville, New Jersey said: "In mentioning pensions and their demise, why did you not mention all that we're paying for the pensions of our government officials? Maybe we should all run for Congress."
Well, we did report the attractiveness of the federal program, but your point is certainly on the market -- on the mark.
And, regarding our poll question last night, over which investigation interests you most, Blaine Browning of San Francisco said, "Moussaoui or Scott Peterson? I believe understanding terrorist threat stories is much more important is than covering deliberate leaking in an oversensationalized case. Follow what affects us all, not what is hype."
We try to do precisely that on this broadcast and couldn't agree with you more.
Thanks for writing in. We love hearing from you. Send us your thoughts at loudobbs@cnn.com.
And tomorrow night, our guests will include Senator Joseph Lieberman, Senator John Breaux. And we continue our series of special reports on vanishing retirement. We'll be in Washington tomorrow night.
For all of us here, good night from New York.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Empire?>
|
