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CNN LOU DOBBS MONEYLINE
Funny Cide to Make Run For History
Aired June 6, 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 Friday, June 6, here now Lou Dobbs.
LOU DOBBS, HOST: Good evening everyone.
The head of the Defense Intelligence Agency today said there is no doubt that Saddam Hussein was trying to build weapons of mass destruction but he acknowledged that the agency could not pin down proof that Iraq had chemical weapons last fall. A summary of a Defense Intelligence Agency report from last September said there was no reliable information about Iraq's chemical weapons program.
Senior Pentagon Correspondent Jamie McIntyre joins us now live -- Jamie.
JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Lou, the Pentagon is strongly rejecting any suggestion that a September, 2002 DIA report cast doubt on whether Iraq possessed weapons of mass destruction before the U.S. went to war.
One sentence in an unclassified summary of the report, obtained by CNN, has raised some eyebrows. It reads: "There is no reliable information on whether Iraq is producing and stockpiling chemical weapons or where Iraq has or will establish its chemical warfare agent production facilities."
But that no reliable information statement refers to the location of Iraq's weapons of mass destruction and their production facilities, not whether it still has old weapons according to the director of the DIA.
(BEGIN VIDEO CLIP)
VICE ADM. LOWELL JACOBY, DIR., DEFENSE INTELLIGENCE AGENCY: It is not in any way intended to portray the fact that we had doubts that such a program existed, that such a program was active, or such a program was part of the Iraqi WMD infrastructure.
(END VIDEO CLIP)
MCINTYRE: In fact, the summary is replete with references indicating the intelligence agency believes Iraq has banned weapons. "Unusual munitions transfer activity in mid-2002 suggests that Iraq is distributing CW munitions in preparation for an anticipated U.s. attack," said one part of the report. Another direct quote: "Iraq probably possesses CW agent in chemical munitions; possibly including artillery rockets, artillery shells, aerial bombs, and ballistic missile warheads."
And, in another part: "Iraq is assessed to possess biological agents, stockpiles that may be weaponized and ready for use."
The bottom line is that the intelligence assessment is full of caveats and qualifications about he lack of direct information but the overall conclusion of the DIA in September of 2002 was that Iraq probably had chemical weapons and was in a position to use them -- Lou.
DOBBS: Jamie, as you say, all sorts of caveats, qualifications, assessments by the DIA, the CIA, and other intelligence agencies, but the fact is now more than eight weeks later after the end of that war there is no evidence of chemical weapons or biological weapons. This has to be a priority of the U.S. forces there. What is the current thinking?
MCINTYRE: Well, the current thinking is that well obviously that some of the intelligence was wrong. For instance, in that DIA report suggestion that chemical shells had been moved to the battlefield, well the thinking now is that probably wasn't the case but they still say Iraq is a big country.
There are lots of places that things could be hidden and it's simply going to take quite a long time to figure out what happened to those weapons of mass destruction. But the Bush administration at this point is not stepping back from its intelligence before the war that Iraq maintained such a program.
DOBBS: Is there, Jamie, a sign of any major disagreement on the possession of weapons of mass destruction on the part of Saddam Hussein's Iraq amongst the DIA, CIA, NSA, State Department, and other agencies?
MCINTYRE: Well, I think the feeling, the general feeling of the intelligence community, if I can make that broad a generalization, is that they produce a fairly nuanced and a neutral product that assimilates all of the information the U.S. government has.
Whether it's used properly by policymakers, whether it's presented properly by the government in making its case, whether parts of it are emphasized that shouldn't be, that's a political decision and they try to stay out of that, and I think there's a feeling that -- some people feel that maybe some of the intelligence information was sometimes overstated or perhaps even understated.
DOBBS: By?
MCINTYRE: By the U.S. government as it attempted to make its case.
DOBBS: Jamie McIntyre, thank you very much, our Senior Pentagon Correspondent. A senior government official today said President Bush remains confident that his decision to invade Iraq was made for the right reasons and with the right information.
White House Correspondent Chris Burns joins us now live with more on the story --- Chris.
CHRIS BURNS, CNN WHITE HOUSE CORRESPONDENT: Well hi, Lou. That senior government official does say that it is not clear whether that report actually reached the president's desk but the president is very confident about the fact that he got solid information, solid intelligence information, enough information to go ahead and attack Iraq.
And, that government official also points out that the United Nations supported the search for weapons in Iraq, also the U.S. Congress supported that. So, there is a general feeling here at the White House that there was enough information to go ahead with that attack on Iraq.
Now, the president himself did not give any comment on that today but he did meet with one of his members of the coalition of the willing, the Portuguese prime minister who did come out and have some comments saying that is important to get to the bottom of this issue.
(BEGIN VIDEO CLIP)
JOSE MANUEL DURAO BARROSO, PRIME MINISTER OF PORTUGAL: That matter I think should be settled and should be for the sake of history and vigor and objectivity and truth should be of course explained. But I insist that was not the reason why we supported America.
(END VIDEO CLIP)
BURNS: And, the reason the prime minister says, the reason is for moral reasons, moral reasons indicating that it was important to topple Saddam Hussein, the dictator. And, if you look at U.S. polls, most Americans do agree that it is -- was important to topple Saddam Hussein whether or not there were any weapons of mass destruction but this issue continues as a debate on Capitol Hill as you see point, counter point.
(BEGIN VIDEO CLIP)
REP.DENNIS KUCINICH (D), OHIO: Well, I think it's important. If a nation goes to war that the cause of war be well established. And also what it does is informs us as to what would be the threshold for this administration going to war against anyone and if they can't make this case that they were in fact well informed with respect to going to war against Iraq, then it kind of casts doubt as to their plans to attack any other nation.
REP. JOHN MICA (R), FLORIDA: Anyone who doubts that Saddam Hussein had weapons is either deaf, dumb, or blind. The question is moot in my mind.
(END VIDEO CLIP)
BURNS: Now, the president has said in the last couple of days he is very much aware of this issue. He said that they will be on the look for weapons, that they will reveal the truth but that it will take time - Lou.
DOBBS: Chris Burns, thank you very much.
The International Atomic Energy Agency is accusing Iraq's neighbor Iran of breaking an agreement to safeguard nuclear materials. The agency also returned to Iraq today for the first time since the war against Saddam Hussein.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): The nuke hunters are back. In Iraq, the IAEA went back in today trying to figure out how much material was looted from one of Iraq's facilities after the war and where did the barrels of uranium and radioactive waste go?
On Iran, the IAEA is trying to figure out if there are secret hidden facilities.
In North Korea, the IAEA was monitoring the situation until they were kicked out late last year.
The world depends on the IAEA as its nuclear watchdog but experts say there is one big flaw in the whole process.
HENRY SOKOLSKI, NONPROLIFERATION POLICY ED. CTR.: They are only allowed to go to facilities that are declared or where there is the presence of what's called special nuclear material, usually uranium or plutonium, and that is not necessarily where everything is.
PILGRIM: The agency is overstretched, 136 member countries to monitor not counting rogue nations. IAEA Director-General Mohamed ElBaradei admitted to the agency being taxed to its limits, "I'm going to be running on empty pretty soon" he admitted back in January.
After the United Nations passed resolution 1441, for example, IAEA teams went on an inspection marathon in Iraq that carried out 237 inspections at 148 locations including 27 new locations at 1,600 different buildings and still ended up begging for more time.
Many nonproliferation experts say it's nearly hopeless. The facilities they can inspect are often cleaned up and they have no access to verify hidden ones.
ROBERT DUJARRIC, HUDSON INSTITUTE: The problem is that in most countries that are suspected of being involved in nuclear proliferation, they are facilities which are kept out of balance with the IAEA inspectors so they can not have a look at the areas where nuclear proliferation is actually taking place.
(END VIDEOTAPE)
PILGRIM: Now, experts say the inspection system is flawed. Countries can be in compliance with the rules and then within weeks adapt their facilities that have been signed off on to weapons use, so inspections are not the final solution -- Lou.
DOBBS: Well certainly not hit and miss inspections.
PILGRIM: Yes.
DOBBS: But it also points out the flaws in our intelligence apparatus if, indeed, what we rely upon, that is satellite technology and human intelligence is not serviceable to give us the answers we desperately need here.
PILGRIM: A lot of these facilities are being built underground. The inspectors don't have access. A lot is going on that is not being watched.
DOBBS: Kitty, thank you very much, Kitty Pilgrim.
That brings us to tonight's poll question: "Whom do you trust most on the issue of Iraqi weapons of mass destruction, Defense Secretary Donald Rumsfeld, Secretary of State Colin Powell, the CIA, or U.N. weapons inspectors?" Cast your vote at cnn.com/moneyline. We'll have the preliminary results coming up later in the broadcast.
The final results of yesterday's poll question, "Which issue should the Democratic presidential hopefuls be running on?" Fifty- nine percent said economy, 19 percent health care and retirement, four percent the war on terror, 17 percent of you voted I love George.
We turn now to our special series of reports, "Vanishing Retirement." Tonight we focus on the need for good financial planning to ensure retirees have enough money upon which to live.
Casey Wian reports.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT (voice-over): Fern Shaw is a single 58-year-old small business owner who had planned to retire in eight years but stock losses and no company retirement plan means she'll likely work longer.
FERN SHAW, PRES., SDA CRAFT TECHNOLOGIES: There is no way that I could really retire at the age to which I had planned on retiring. Maybe we need to think about a couple of extra years.
WIAN: A financial planner is helping.
ANN MARIA LANDER, FINANCIAL PLANNER: The worst thing to do is to run out of money before you've run out of life.
WIAN: But many Americans face that danger. Only half of non- government workers have a traditional pension or 401(k) plan. Even those with plans aren't saving much. Among workers nearing retirement age, the mean value of their 401(k) assets is under $54,000.
But there are options from expanded 401(k)s, IRAs and annuities to an old-fashioned dollar cost averaging investment portfolio. Shaw is considering selling her condominium and saving the profits for retirement.
SHAW: It was an idea that I had thinking to reduce my expenses now and save more.
LANDER: Instead -- exactly. Instead, I would want you to consider making one extra payment a year on your mortgage.
WIAN: She's also persuaded Shaw to dump her individual stocks in favor of diversified mutual funds and she advises starting a simple individual retirement account for her small business which would result in $9,000 a year in tax deferred savings, but Shaw isn't convinced because of the requirement that she match her employees' contributions.
SHAW: It's not complicated but I still need to have further conversation on it.
WIAN: That's typical of small employers. One survey found that only seven percent are very likely to begin offering employee retirement plans in the next two years and most Baby Boomers aren't expecting much from Social Security.
DEBORAH SCHWARZ, PRES., LIBRARY ASSOCIATES: It may be there. It may not be there but that's something I don't count on at all.
WIAN: Deborah Schwarz's small business offers a 401(k) with limited tax breaks so her financial planner recommends taxable mutual funds. While the 48-year-old single mother lives a comfortable lifestyle now, she's worried about the future.
SCHWARZ: I don't necessary look to be wealthy but I certainly don't if I want to go on a trip to Italy, something I can't do right now, I want to be able to do it and be able to support my kids and give to my grandchildren and my parents too if I have to.
WIAN: Ambitious but not out of the question.
ROSE GREENE, FINANCIAL PLANNER: The good news is that your warm but you're not on fire. Nine percent loss isn't really that bad in light of what this market has been through in the last year.
WIAN: Financial planners say there are more retirement savings choices now than ever. The problem is not enough people are taking advantage of them.
(END VIDEOTAPE)
WIAN: Now, both of the financial advisers we spoke with say a common fear among women is ending up like the stereotypical bag lady pushing a shopping cart down the street and sometimes they say that fear is so paralyzing many people don't do anything to save for retirement, and that planners say is even worse than picking a bad stock -- Lou.
DOBBS: A tough situation, Casey Wian thank you very much reporting from Los Angeles.
Still ahead here tonight, for all the CEOs on our corporate crime scoreboard there is a new guidebook for you on how to survive in the big house. Tip one, bring your soap on a rope. We'll be talking with the author of "Who moved my soap" satirist Andy Borowitz.
And, Sammy Sosa comes out swinging, vowing to fight his suspension.
Martha Stewart says she's innocent. We're going to have their stories and a great deal more. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Three executives from WorldCom have already been added to our criminal scoreboard. Former CEO Bernie Ebbers has so far managed to avoid an appearance on our scoreboard or charges at all but that may change soon.
A much anticipated report reveals for the first time that Ebbers did, in fact, play a role in the company's efforts to inflate revenue. The report due to be released Monday details how the company used accounting fraud to cover up more than $10 billion in losses.
On Wall Street today the Dow Jones industrials posted modest gains despite a rise in unemployment. The jobless rate rose to 6.1 percent last month. That's the highest level in nine years. The Dow gained as many as 174 points early in the session, finished with a gain of only 21.49. The NASDAQ down nearly 19 points on the day, the S&P 500 fell two points.
Christine Romans here with the market today and a wrap-up for the week, a pretty good week at least.
CHRISTINE ROMANS, CNN CORRESPONDENT: It really was and, Lou, today was the best volume at the big board since March, 1.8 billion shares on a pretty volatile day, 168 points.
DOBBS: That's "B" with a billion.
ROMANS: "B" with a billion, 168 point range for the Dow, so a lot of volume going up and a lot of volume coming down as well.
For the week, the Dow and the NASDAQ and the S&P all gained more than two percent, the S&P 500 up seven of the last eight weeks and, Lou, for the (UNINTELLIGIBLE) 2000 it was the eighth weekly gain in a row. That hasn't happened since 1999.
Now, McDonald's led the Dow today, up nine percent its best rally in more than a year. It May sales were surprisingly strong, the best monthly sales gain in four years for McDonald's.
Also, Oracle made a hostile play for People Soft, a $5.1 billion bid that People Soft, Lou, calls atrociously bad behavior.
DOBBS: Oh, no.
ROMANS: And a transparent attempt to thwart People Soft's purchase in JD Edwards that was announced earlier this week. Watch this space. A lot of folks are looking for some fireworks in software next week.
Meanwhile, money continues to flow into the market, in the latest week $3 billion moved into stock funds, $2.4 billion into bond funds most of that in corporate bond funds. In fact, we checked it out over the past nine months assets in corporate bond funds have grown to about $509 billion as investors are searching for a yield and, as you know, the yields, Treasury yields, 1.25 percent was where the two-year closed today.
DOBBS: Right on the Fed funds mark.
ROMANS: Right on the Fed funds, ten year about 3.35 percent.
DOBBS: Now, about that tax cut that's supposed to be driving equities with improvements in rates on capital gains and dividends, here goes the corporate bond market rally.
ROMANS: Yes, absolutely, and some people are saying this is stretched for months now. Maybe there's going to be some sort of top in there but...
DOBBS: There's always the top in there somewhere. We can safely say that.
ROMANS: And you never know until it's over as well.
DOBBS: Fat lady sings, et cetera. All right, Christine Romans thank you very much. Have a good weekend.
ROMANS: Have a good weekend.
DOBBS: Time now for our nightly check of the national debt now standing at more than $6,590,000,000,000. and counting.
Coming up next it is a war and a not very civil war in college football. It's a battle to save the Big East from losing two marquee schools and a huge amount of money. Of course it's all about sportsmanship and student athletes really but we'll tell you about this story from a different perspective tonight.
And, the editors of this country's top business magazines join us as they do each Friday evening for our weekly "Editor's Circle," their perspectives on this week.
(COMMERCIAL BREAK)
DOBBS: Chicago Cubs slugger Sammy Sosa has been suspended for eight games for using a corked bat. Major League Baseball suspended Sosa for using that corked bat during a game earlier this week. Sosa says he grabbed the wrong bat by mistake and his team is giving him full support.
(BEGIN VIDEO CLIP)
JIM HENDRY, GEN. MGR., CHICAGO CUBS We feel like that obviously the investigation proved that his past and the present bats that he had in his locker were all clean. We have no reason to believe it was more than a one-time incident as he described it and we will support him in his rights that he exercises to appeal and hopefully have the suspension reduced.
(END VIDEO CLIP)
DOBBS: Sammy Sosa will continue to play for the Cubs while the suspension is appealed.
Well, there's a big college sports battle shaping up but this battle isn't on the field. It's in the courts now. Five Big East schools are suing to stop two universities from jumping to the Atlantic Athletic Conference. Bill Tucker has the story.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): This is story not about the love of sport nor the sanctity of amateur athletics, no. This is a story about money.
RICHARD BLUNENTHAL, CONNECTICUT ATTORNEY GENERAL: This lawsuit is about a backroom conspiracy born in secrecy, founded in greed, carried out through calculated deceit. It's a sad story in the history of college athletics.
TUCKER: It is nothing short of civil war. Fifteen schools make up the Big East Conference. Five of those schools have banded together to file suit against two of their own, University of Miami and Boston College, to keep them in the Big East and against the Atlantic Coast Conference for trying to lure the schools away.
Boston College had no comment. Miami's reaction was brief.
PAUL DEE, ATHLETIC DIR., UNIV. OF MIAMI: We're aware of the allegations. We'll be prepared to present the university side of the case.
TUCKER: Syracuse is not named in the suit but is holding talks with the ACC and a spokesman for the school said that Syracuse is happy not to be named but that it's sad that it's come down to a lawsuit.
What's all the screaming about? Well, if Miami, Boston College, and Syracuse pull out of the Big East and go to the ACC the Big East will no longer be eligible to participate in the College Bowl championship series. Participation in that series netted Miami $13.5 million for the championship game plus the exposure for the Big East that came with the game.
RICK NORROW, SPORTS BUSINESS ANALYST: The ACC thinks they're going to get a lot more money with TV, with Miami and BC in because that's the Miami and the Boston market and who can blame them?
(END VIDEOATAPE)
TUCKER: Now, the ACC has not been commenting publicly on this issue but a source is telling me tonight that university presidents could be voting on this issue as early as next week and if they approve invitations could be extended to the school shortly after -- Lou.
DOBBS: Secrecy, greed, and deceit.
TUCKER: Yes.
DOBBS: Strong words. This is hardly the stuff of college athletic student athletes and concern about their young men and women competing.
TUCKER: Oh, but it's the words of money, Lou, and that's what this is about. The NCAA by the way is playing Switzerland on this one. They haven't had any comment and they're staying as far away from this as they can.
DOBBS: They're probably more involved with 25 cent soft drinks that athletes are having at somebody else's expense.
TUCKER: I think so.
DOBBS: Did that sound editorial? I apologize.
TUCKER: No, that's OK. I'll accept your apology.
DOBBS: Thank you very much.
TUCKER: And the editorial too.
DOBBS: Exactly. Bill Tucker, thank you.
When we continue our "Thought of the Day" on the hard part of success.
And, Funny Cide's wild ride from upstate New York to a run for the Triple Crown. We'll be talking with his owners. We'll have a live report for you from Belmont Park as that horse tries to make history tomorrow.
A Florida judge has made a ruling on whether this woman can wear her veil in her driver's license photo. You got to love this country. That story and much more still ahead, stay with us.
(COMMERCIAL BREAK)
DOBBS: A California judge will not release autopsy reports in the Laci Peterson murder case. Prosecutors sought the release after some of those results were leaked to the press. The judge also declined to issue a gag order on lawyers involved in the case. Powerful evidence tonight that a piece of foam insulation may have led to the Space Shuttle Columbia disasters. Investigators today fired a chunk of foam at a shuttle wing panel. The foam caused a three-inch-long crack in the reinforced carbon. One investigator said that you would not fly the shuttle in space with a crack like that.
And, take a look please if you will at this video. A policeman in Idaho chasing down a runaway train this afternoon. He jumped aboard, brought it to a stop. The locomotive was first spotted rolling along at about 40 miles an hour when Corporal Dwayne Prescott (ph) started chasing it down. No one was hurt in the incident, Idaho courage.
And, in other news across America tonight, a Florida judge has ruled that a Muslim woman cannot wear a veil in her driver's license photograph. Gerald Reznick from our affiliate WKMG in Orlando, Florida joins us with the story -- Gerald.
GERALD REZNICK, WKMG CORRESPONDENT: Lou, I can tell you reaction is coming into this one tonight. The cheers from Florida Attorney General Charlie Crist, jeers from the ACLU folks down in Miami. As for Sultana Freeman (ph), well she is saying she simply wants the world to stop trying to unveil her but the veil stays in this battle of church and state.
(BEGIN VIDEOTAPE)
REZNICK (voice-over): Within minutes of the judge's decision we caught up with Saltana Freeman and her husband Abdul Mallik leaving their Winter Park home and rushing to their attorney's office.
ABDUL MALLIK FREEMAN, HUSBAND: I guess we anticipated, we anticipated some things.
REZNICK: They anticipated Circuit Judge Janet Thorpe (ph) would side with the state. In her ruling, Thorpe found the Freemans did not prove lifting (UNINTELLIGIBLE) Saltana's veil for a driver's license photo would cause her hardship.
A. FREEMAN: Just with that statement you said she's going to have to lift a veil. That's out of the question. She's not lifting the veil. This is a religious principle.
REZNICK: They're now taking the case to the appellate level.
HOWARD MARKS, FREEMAN'S ATTORNEY: This is just found one in a long legal battle and my clients are aware of that as well as I am aware of that.
A. FREEMAN: We don't quit. We have a no quit attitude because we're doing it in the appropriate way. We're not doing it the malicious way, the vicious way. We're doing it through the court system.
(END VIDEOTAPE) REZNICK: And the irony of this entire story is the fact that we have seen Ms. Freeman's full face before in 1998. Police in Illinois, they took a picture of her, a mugshot after she was arrested on felony charges of aggravated assault on a 3-year-old child. She was convicted of that. And that picture was entered into evidence during this case last week. But the judge would not allow it.
So the Freemans obviously, didn't get that in. But the state did win this at this point. The Freemans are now going to go on and try to appeal this in the fifth district appeals court, which is in Daytona Beach. They have 30 days to put those in.
For now we are reporting live for CNN, Gerald Reznick in Orlando -- Lou.
DOBBS: Thank you very much, Gerald Reznick.
Turning to other news tonight, history could be made tomorrow at Belmont Park in New York. Funny Cide tries to become horse racing's first Triple Crown winner in a quarter century. One of the most anticipated horse races ever, and it's likely to be one of the most watched as well.
Josie Karp is out at Belmont Park and has the story for us -- Josie.
JOSIE KARP, CNN SPORTS CORRESPONDENT: Well, Lou, we're about 24 hours away from Funny Cide's bid for history here at Belmont Park. And I guarantee there are going to be a lot more people here at this time tomorrow than there are right now as Funny Cide goes up against five other horses.
The six-horse field for the Belmont is the smallest since 1994, but it bodes well for a Triple Crown victory tomorrow. That's because if you look back on history at the 11 horses that have won the Triple Crown here at Belmont, the average field size has been between five and six horses. The expected contender, the one who's supposed to push Funny Cide in this race is Empire Maker. Now he was the horse who was favored to win the Kentucky Derby and was upset by Funny Cide. They also went head to head in the Wood Memorial. And it's interesting to note that Empire Maker won there. Funny Cide finished second. But that was run on a muddy track, and there is rain in the forecast tomorrow, and both of these horses have shown that they can run well on a muddy track.
Another thing to consider: if Funny Cide doesn't end up winning the Triple Crown, he went through a blistering workout on Tuesday morning. He covered five furlongs in less than 58 seconds, and a lot of people on the inside of horse racing thought that was way too fast and is certainly faster than normal for him. But his trainer, Barkley Tagg, said that he did it so effortlessly that he's really not worried at all, and he proclaims his horse ready to go tomorrow -- Lou.
DOBBS: Can't wait to find out. Thank you very much, Josie Karp.
There's also an interesting human side, of course, to the story of this remarkable horse. Six of Funny Cide's 10 owners are high school buddies, long-time friends from a small town in Upstate New York. They bought Funny Cide with their lottery winnings. Tomorrow they hope their luck continues to hold.
I talked with them earlier and asked Jack Knowlton, their managing director, how he feels about success so far in taking on and beating the horse racing establishment.
(BEGIN VIDEOTAPE)
JACK KNOWLTON, MANAGING PARTNER, FUNNY CIDE: Well, I think that, you know, we are the exception to the rule, obviously. Most of the people that have horses that win races in the Triple Crown have a lot more money invested in this game than we do. We bought this horse for $75,000. It's the ninth horse are partnership has had. It's the most expensive horse that we've ever bought. And you just don't expect that something like this is going to happen when you're, you know, dabbling in the game at that level.
DOBBS: If this something you would recommend that everybody do? You guys have modest investments but together, a powerful investment in horse racing. Would you recommend that other people do this? Jon?
J.P. CONSTANCE, CO-OWNER: Sure, why not?
Yes, you know, this is a great country, Lou, that we live in, where 10 guys can get together and accomplish what we have. But if anybody's thinking about getting into this to make money, forget about it!
We've just been awful lucky, that's all. We've had some good breaks and I certainly encourage people to have as much fun as we're having. But don't think you're going to get in here to pad the retirement, because it's probably not going to happen.
DOBBS: Well, you've got a pretty good prospect at padding, with a $6 million -- $6 million waiting for you tomorrow if Funny Cide delivers. You guys aren't thinking about how to split that yet, are you?
CONSTANCE: No, we're going to wait and let it happen. If it does happen, it happens. If not, it doesn't. We've accomplished, you know, because of this horse, more than we ever would have hoped to accomplish. He's won the Kentucky Derby and he's won the Preakness, two of the classic races in this country.
And the fun and enjoyment that we've had, our families have had, our friends have had along the way, you know, money really can't duplicate that. It's just the thrill of a lifetime and something that all of us, and I think our family and friends, are going to always remember in 2003.
DOBBS: And you put real meaning back into horse racing for lots of us.
Is this, tomorrow -- your horse has done pretty well. Three for three at Belmont. This could be the capper. But is this really a two-horse race tomorrow? Jack?
KNOWLTON: I don't think by any stretch of the imagination, you know, you can characterize it as a two-horse race. I think everybody, you know, would have thought Empire Maker was going to be the horse that would be going for the Triple Crown, not Funny Cide. We've reversed roles. We've got the opportunity to go and he's got the opportunity to be the starter.
But you've got a couple other horses: Ten Most Wanted and Dynever, I think, on paper certainly could be real threats. And the other two horses in the race, last year it was a 70-1 shot that won. So you just never know. Horse racing, last year, one of them just about went to his knees. He was going for the Triple Crown. Anything happens in big races, even with small fields.
DOBBS: Rain in the forecast for tomorrow. Funny Cide is not -- a mudder, pretty good track record on wet tracks. Do you think that will be an advantage for your horse?
KNOWLTON: Well, I think that no matter what the track condition is, he'll run his race. He's run well on off tracks before; he's run well on fast tracks. So, you know, we really aren't concerned. We'd like a nice day and a face track for the crowd. That to us would, you know, just make the capstone of the day. Whatever the track condition is, all six horses have to run in it, and hopefully, Funny Cide's going to be the victor.
DOBBS: All right. Well, let me just say to all of you there, Larry and Harold in the back, Peter and Jack, Mark and Jon across the front, the owners in this Funny Cide gelding who's just brought a dream come true for you and your partners.
We wish you all the very best of luck at Belmont and, of course, the Triple Crown.
(CROSSTALK)
(END VIDEOTAPE)
DOBBS: And good luck, Funny Cide.
It brings us to our thought of the day on success.: "The toughest thing about being a success is that you've got to keep on being a success." That thought from songwriter Irving Berlin. And it applies as Funny Cide goes for the Triple Crown tomorrow.
And a special thought for this day. In remembrance of the men and women who lost their lives 59 years ago when they stormed the beaches at Normandy: "History does not long entrust the care of freedom to the weak or the timid." In honor of D-Day, that thought from Allied Supreme Commander Dwight David Eisenhower.
Still ahead here, a prescription for success. Our "CEO of the Week" on balancing ethics and competition.
Satirist Andy Borowitz shares the seven habits of highly effective prisoners in his new "CEO Guide to Life in Prison."
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Our "CEO of the Week," one man who turned his vision of consolidation into a multibillion-dollar leader in its field while growing the company at what seems like an impossible rate. He's managed to make ethics of cardinal importance to all of his employees. Bob Walter of Cardinal Health Care is our "CEO of the Week."
(BEGIN VIDEOTAPE)
DOBBS (voice-over): Bob Walter says he's never liked working for big companies.
ROBERT WALTER, CHMN & CEO, CARDINAL HEALTH: I didn't like the bureaucracy, the lack of sense of urgency, the lack of personal responsibility.
DOBBS: He started what would become Cardinal Health at the age of 26. Thirty-one years later and more than 40 acquisitions later, he sits atop one of the largest distributors of pharmaceuticals, medical supplies, and equipment. Sales totaled $51 billion last year.
WALTER: For the last 60-some quarters more than 15 years, we've grown our earnings per share at a rate in excess of 20 percent.
DOBBS: His reputation as an exceptional manager has landed him a seat on the boards of American Express and Viacom. His own board is completely independent. Stock options aren't expensed, but they are disclosed in the company's financial reports.
WALTER: While I don't have my name on the door, I have a deep sense of ownership in the company and its responsibility. So ethical standards are really important in the company.
DOBBS: For the last eight years, Walter has pushed the company beyond drug distribution.
WALTER: I'm extremely competitive. And if there's anything that would get me upset is to know that there was an opportunity that I or our company could have achieved, that we either didn't see or we didn't work hard enough.
DOBBS: Walter also asked his employees to give back to their communities, especially through education and children's causes.
WALTER: I respect people that can do more than just make money for themselves. I respect people that can actually share in some of their talents to the rest of society.
DOBBS: Investors have benefited from his talents. The stock is up almost 50 percent over the past five years.
(END VIDEOTAPE) DOBBS: Our congratulations to Robert Walter of Cardinal Health, "Our CEO of the Week."
Checking now on the trade deficit, it stands at more than $218 billion. And a reminder to vote in tonight's poll. The question, whom do you trust most on the issue of Iraqi weapons of mass destruction? Donald Rumsfeld, Colin Powell, the CIA or U.N. weapons inspectors? Please vote at cnn.com/moneyline. We'll have the preliminary results for you coming up in just a few minutes.
Andy Borowitz is the man who created TV's "Fresh Prince of Bel Air." He produces fresh and funny satires as well on the Web in his daily BorowitzReport.com. Andy puts his own humorous spin on the day's headlines. He's also written a book entitled "Who Moved My Soap?" He recommends the book for CEOs who have been caught. In fact the subtitle is, I think appropriately, "The CEO's Guide to Surviving in Prison." Andy Borowitz joins us tonight. Good to have you here, Andy.
ANDY BOROWITZ, AUTHOR, "WHO MOVED MY SOAP?": Good to be here, Lou.
DOBBS: This is a wonderful moving tribute to corporate America, this book.
BOROWITZ: Absolutely.
DOBBS: What moved you to write it?
BOROWITZ: Well, you know, for months guys like you were telling Americans the depressing news about Enron and Tyco and WorldCom and we were all losing our shirts. And I thought somebody ought to write something that will cheer everybody up. That's what "Who Moved My Soap?" all about.
DOBBS: So this wasn't motivated out of compassion for the poor fallen CEOs?
BOROWITZ: Well, it was in a way because you know, there's this tremendous gaping hole in our business school curriculum now, which is that business schools teach CEOs how to get to prison but it doesn't teach them what to do when they're there. And that's what "Who Moved My Soap?" does.
DOBBS: And the Borowitz school is perfectly and appropriately advisory on penitentiary life.
BOROWITZ: Absolutely. Well we do have a lot of helpful advice for our crippled CEOs in there.
DOBBS: Let me ask you -- just turning to -- you have covered every gamut. And when I said the Borowitz Report, not reports, but BorowitzReport.com is one of the funniest reads of your day if you would like to go to it. You have hit every topic in the world, from war to the corporate corruption scandal. But one of the most amazing things is when on your Web site, and I read it as you did it, you disembedded, if that is the correct word, Geraldo Rivera from the 101st Division and, what was it, a week or so later, two weeks it actually happened. Do you often anticipate reality with your satire?
BOROWITZ: Well, weirdly enough, that happens. It's very strange because with "Who Moved My Soap?" we planned on this book always coming out this week. And sure enough what happened this week but Martha Stewart's arraignment.
So I don't know, maybe I am sort of an advance news feed of some kind or I'm sort of Nostradamus. Maybe "The Weekly World News" would like to sign me up.
DOBBS: I'm sure there are a lot of people that would like to sign you up with this clairvoyant channel that you've established.
Martha Stewart, where does Andy Borowitz come down on Martha Stewart?
BOROWITZ: Well, I'm not concerned about Martha, really. I think she's pretty tough. As a matter of the person I'm concerned about is the person who has to arrest Martha Stewart and sort of take her into custody because she has access to the finest knives in the world and a glue gun. So I mean, let's not be too sorrowful for Martha just yet.
DOBBS: And we at this company were, of course, chagrined to say the least when you put Baghdad Bob, the Iraqi information minister, in charge of our P.R. department for AOL Time Warner.
BOROWITZ: Absolutely.
DOBBS: We were of course heartened today when you placed him at the lead editorial post at "The New York Times."
BOROWITZ: Yes. The Borowitz Report did break that news, that he is now the new editor in chief of "The New York Times." It's very exciting for Baghdad Bob. He also consoles (ph) as his deputy editor, Dr. Typo, who was one of his cadre. So we're very excited about that.
DOBBS: Of course, the thing that was most heartening to all of us here was you pointed out that move was made possible because now here at AOL Time Warner everything is working so smoothly.
BOROWITZ: So well.
DOBBS: Mission accomplished.
BOROWITZ: So well, so well.
DOBBS: Andy Borowitz, I hope you come back soon.
BOROWITZ: I would love to come back. And, Lou, this is for you. It's a "Who Moved My Soap?" soap on a rope. It's very good in prison because you can't drop it. It's something you want to have. You have a lot of CEO friends.
DOBBS: We do. And we'll be ordering these by at least the dozens.
BOROWITZ: Thank you so much.
DOBBS: Andy Borowitz, thanks a lot.
BOROWITZ: Great to see you, Lou.
DOBBS: Come back soon.
Coming up next, "Our Editors' Circle", the nation's premier business magazine editors will join us. We'll be talking about "The New York Times", the economy, Martha, Andy Borowitz, and a great deal more.
And you had plenty to say about Martha Stewart's indictments. We'll share some of "Your Thoughts" next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The stock market showed strength and resilience this week, managing strong gains despite scandalized American icons and a nine-year high in unemployment.
Joining us now with more on their thoughts about what lies ahead for the markets, the economy, this political economy, the editors of the country's leading business publications. Jim Ellis, he's the chief of correspondents at "BusinessWeek." Rik Kirkland, the managing editor of "Fortune" magazine. And Robert Lenzner, the national editor of "Forbes" magazine. Gentlemen, good to have you with us.
Well, let's start out with the market. It continues to move higher and higher just like Steve Forbes said it would months ago. Jim?
JIM ELLIS, "BUSINESSWEEK": Well, I don't want to give him the credit for it, but I think that a lot of people are expecting some good things to come. One good thing is that it probably can't get a lot worse. The economy seems to be showing -- it depends on which day you look, but some days there's a sign that we probably have hit bottom and it wants to break up. The bigger question is how long does it take before we can actually do that?
RIK KIRKLAND, "FORTUNE": I think it's really healthy to see days like today. I like days like today, where you shoot off to 150, and I think, man, we're getting ahead of ourselves, and people are kind of taking their profits and you end up just a little ahead, the Nasdaq's down a little bit. You've got to climb that wall of worry, you know, as they say.
ROBERT LENZNER, "FORBES": It's what kings called animal spirits, that we're seeing the animal spirits building up on each other. And as it goes higher, all these people that have cash feel like they're going to have to miss something. So no one actually predicted exactly -- except for Steve, of course...
DOBBS: Well, he didn't say exactly. He said 30 percent -- what was the number?
LENZNER: He said if we won the war fast it was going to go up 30 percent or 40 percent.
KIRKLAND: Let's bet where it is by the end of the year and we'll see.
DOBBS: Well, you know, I'm one of those people who's hoping Steve is exactly right.
KIRKLAND: I'm pulling for it.
DOBBS: But I agree with you, Rik. The issue is -- I guess it's now a high-class problem. You get nervous when you see this market getting up that high. But it's been so long since we've had this to worry about that I...
KIRKLAND: Yes, I hate to be a spoilsport because it really is pleasant, and as you said, I'm really pulling for it to keep going. But we're in an era where reality and realism has to rule and the economy is turning I think. We bottomed out. But it's not going to come roaring. It's three yards and a cloud of dust.
This market should go up, and it is predicting where we're going to be six months out, supposedly, but it can't get too far ahead of reality.
DOBBS: Well, the New York stock exchange is catching up with reality. They're going to start telling people what their CEOs and top executives make. They're actually insisting upon a level of transparency. Are you heartened by that, Jim?
ELLIS: Well, I mean, it seems a little ridiculous to think that it's happening now. I mean, it's -- they're a little behind the curve. It is amazing that an organization that basically serves as a watchdog over so many companies can actually, you know, operate in secrecy before. I suppose this is a good thing, but it certainly is overdue.
KIRKLAND: And when are we going to get those numbers?
DOBBS: I'm sure that it will be on a timely basis.
KIRKLAND: By the fourth quarter or is it going to be next week?
LENZNER: Well, I think it just enforces that the issue of compensation in America is a major one that isn't going away. It's going to be around for a long time, and it's...
DOBBS: Especially not if the CEOs have their way, right?
LENZNER: Right. Exactly. Well, it has many aspects. The options. the retirement pay, the huge pay even in companies that aren't doing well, aren't performing.
I think that, you know -- and I think that we see that shareholders are getting more and more irritated by that. And there are more and more lawsuits about it.
DOBBS: And more and more shareholder resolutions being introduced at those meetings. They're not doing particularly well in the vote, but at least...
LENZNER: It's gaining. They're gaining.
(CROSSTALK)
KIRKLAND: There's a sea change going on.
LENZNER: Yes.
KIRKLAND: Full disclosure is the name of the game.
DOBBS: We can only hope.
Martha Stewart, not a lot of disclosure there, but a lot of indictments, nine of them. What do you make of this?
LENZNER: Well, I think that the great -- they've got one witness against her. My feeling is -- I've looked into this quite closely and I've talked to people close to it. They have one witness against her. It looks -- there's allegations that she lied 10 times. But all they have to do is get one juror on the jury to be empathetic to Martha, and I think there's a rising swell women in the nation who think that Martha's been singled out for being damned by this while...
DOBBS: Has she been?
LENZNER: I don't think so. I think that the government had to go after her on this.
But there are a lot of people who are saying that Mr. Skilling and Mr. Lay and all these other people are wandering around free and why are they doing this for her over a little bit of money. But I think they had to do it.
ELLIS: But simply because her alleged crime was smaller than hers doesn't necessarily mean she shouldn't be prosecuted.
(CROSSTALK)
KIRKLAND: And I'm vociferously, you know, ambivalent on the whole thing. On the one hand she seems to have lied about the obstruction stuff, and if she's did that and that's proven, the government should go after her. But I hate the sort of loosey-goosey definition of insider trading where you're not a principal, you're not, you know, you're not an employee, somebody calls you up and leaves a message and you -- you know, and you do like it's like a scrap of paper blows a tip in your pocket, you could be indicted for insider trading? (CROSSTALK)
KIRKLAND: Well, they indicted her for this sort of kind of related charge of fraud...
(CROSSTALK)
ELLIS: And she's a former securities professional. She knows what the rules are.
DOBBS: By the way, didn't she sit on the board of the New York Exchange?
LENZNER: Briefly. Very, very briefly. Just slightly more than Sanford Weil. Actually, I don't think Sanford...
DOBBS: No, he didn't.
LENZNER: Yes. Right.
DOBBS: He was nominated.
DOBBS: Well, speaking of people who are not sitting there. The two top editors of "The New York Times" gone. A lot of debate about it. What are your -- what's your thought, Jim?
ELLIS: It's a sad sort of a sad thing for American journalism. I think that no one questions the abilities that these two men had as being editors. I think that the issue there is a management judgment issue. And I think that it sort of -- it hurts our credibility in our field. It also unfortunately is going to cause a lot of people to say that their attempt to broaden the newsroom and to have it -- make it more diverse has -- it's going to give people a lot of ammunition now to say that there shouldn't be diverse newsrooms. I've already heard that among people in our business.
DOBBS: Shouldn't be at all?
ELLIS: I've heard people say that. And I think that unfortunately they've opened up, you know, this field for those kinds of charges. I think it's a mistake.
KIRKLAND: To me what's interesting about it is from a business magazine editor's standpoint is it's a management story.
DOBBS: Absolutely.
KIRKLAND: Howell Raines was a brilliant editor. Very tough, knew what he wanted to do. But he really never got the loyalty of the troops, and he didn't have that. And if you're going to do that at an institution like "The Times" and you fall they will bite you in the neck as soon as they can, and that's what happened.
DOBBS: And Abe Rosenthal right now has got to be -- and he would never say it. He's far too gracious a person, but he's got to be saying... KIRKLAND: Yes, I've been there.
LENZNER: Well, the way I look at it is Arthur Sulzberger, Jr. couldn't fall on his own sword and he is really to blame for some of the things that have happened. But in the annals of journalism there have been far greater scandals at "The New York Times, " namely Mr. Durante who said that Stalin was a great guy and got the Pulitzer Prize and Mr. Matthews who got the Pulitzer Prize for saying that Castro was a Democrat. So those things are really a lot worse than this in terms of what's in the newspaper and the importance of the newspaper in informing the world.
DOBBS: Yes, but as the saying goes, then was then and now is now, and it's...
KIRKLAND: I want to go back and look at what "Fortune" and "BusinessWeek" said 40 years ago. And "Forbes," either.
DOBBS: Nor CNN, 60, 70 years ago.But Each of our organizations has made mistakes. There's no question about it.
One of the things that it occurs to me, Jim -- this is your point. You say there are critics who are talking about diversity in the workplace at a time when diversity in the workplace is critically important. But there also might be great instruction, it seems to me, and I'd like to hear what everybody thinks. Yes, there must be diversity, but we also have to take a realistic and proportionate understanding of accountability for actions, irrespective of our impulses and our best desires...
ELLIS: I don't think anybody -- I don't think any manager, any news manager questions that. I guess the issue here is let's be very careful to separate, you know, sort of what's a poor management decision from what is probably a laudible goal on the part of news organizations to want to make sure that there are disparate voices in the newsroom.
KIRKLAND: But Jayson Blair should have been fired, you know, months or years -- a year at least or more earlier, and when no one...
(CROSSTALK)
KIRKLAND: And that's not a white black, journalist issue. That's just a matter of no one who keeps blowing it should be allowed to...
DOBBS: And we say in news organizations, Jim -- I think the fact is every organization...
(CROSSTALK)
DOBBS: ...every corporation has a commitment to diversity in this country. And we've got to have a commitment also to accountability.
KIRKLAND: No double standard. DOBBS: Gentlemen, as always, we're going to wrap with one quick 15-second forecast from each of you on the market over the next, say, five days -- Bob.
LENZNER: I don't think the market will do very much. I think it will back down some, actually. I think it will back down.
KIRKLAND: Sideways to a little down.
ELLIS: The market is -- until we get some more news on the economy, it's just going to stay straight.
DOBBS: Slow, sustained, steady, rational appreciation. We love it.
KIRKLAND: Absolutely.
DOBBS: Jim, Rik, Bob, thank you very much, gentlemen, for being with us as always.
When we continue, the preliminary results of tonight's poll. We'll share some of your thoughts about none other than Martha Stewart.
(COMMERCIAL BREAK)
DOBBS: Our poll question: "Whom do you trust most on the issue of Iraqi weapons of mass destruction?" U.N. weapons inspectors winning in a landslide.
Let's turn to some of your thoughts. Many of you continuing to write in about Martha Stewart's indictment.
Anthony from Boston said: "It is inexcusable that the 4,000 Stewart traded are draining more of our government's attention that the billions of dollars that Lay, Ebbers and Grubman swindled from the American public."
Lev Mirman disagreed with that view: "She is not just a private citizen. She was on the board of the New York Exchange, which means she was supposed to be the standard of honesty. It is because of this very fact she should be prosecuted."
We always love to hear from you. Send us your thoughts at loudobbs@cnn.com
That's our broadcast for tonight. We thank you for joining us. We hope you have a very pleasant weekend and for all of us here, good night from New York.
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