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LOU DOBBS TONIGHT

CNN Obtains Evidence Iraq Had Secret Nuclear Weapons Program

Aired June 25, 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 TONIGHT for Wednesday, June 25. Here now, Lou Dobbs.
LOU DOBBS, CNN ANCHOR: Good evening, everyone.

Tonight, CNN has obtained evidence that Iraq did have a secret program to develop nuclear weapons. That evidence proves that Saddam Hussein may have been planning to restart his nuclear program if he had remained in power.

Our National Security Correspondent David Ensor has the exclusive report -- David.

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT: Lou, CNN has learned that the Central Intelligence Agency has in its hands the critical parts of a key piece of Iraqi nuclear technology, parts needed to develop a bomb program that were dug up in a backyard in Baghdad.

The parts were dug up by this man, Iraqi scientist Mahdi Obeidi who had hidden them in his backyard under a rose bush 12 years ago under orders from Qusay Hussein and Saddam Hussein's then son-in-law Hussein Kamel.

These are the parts, if we have those pictures, and documents that Obeidi gave the CIA. They were shown to CNN at the CIA headquarters in Virginia. Obeidi told CNN's Mike Boettcher that the parts of a gas centrifuge system for enriching uranium were part of a highly sophisticated system that he was ordered to hide so as to be ready to rebuild the bomb program at some time in the future.

(BEGIN VIDEO CLIP)

MAHDI OBEIDI, IRAQI SCIENTIST: I want to cooperate. I have very important things at my disposal that I've been ordered to have, to keep, and I've kept them and I don't want this to proliferate because of its potential consequences if it falls in the hands of tyrants, in the hands of dictators or of terrorists.

(END VIDEO CLIP)

ENSOR: Former U.N. arms inspector David Kay who is now in charge of the CIA effort to look for the weapons of mass destruction in Iraq started work two days ago in Baghdad. We had the first interview with him. It was done over a secure teleconferencing line from CIA headquarters. Here's what he had to say about this case. (BEGIN VIDEO CLIP)

DAVID KAY, FORMER U.N. WEAPONS INSPECTOR: It begins to tell us how huge our job is. Remember his material was buried in a barrel behind his house in a rose garden. There's no way that that would have been discovered by normal international inspections. I couldn't have done it. My successors couldn't have done it.

(END VIDEO CLIP)

ENSOR: CNN had this story last week but made a decision to withhold it from broadcast after a request from the U.S. government citing safety and national security concerns. The U.S. government has now told us that the security and safety issues have been dealt with and there's no risk now in telling the story fully.

The gas centrifuge equipment dates back to Iraq's pre-1991 efforts to build nuclear weapons. Experts say the documents and pieces that Obeidi gave the U.S. were the critical information and parts to restart a nuclear weapons program and would have saved Saddam's regime several years and as much as hundreds of millions of dollars for the research.

Now, U.S. officials emphasize that this is not a smoking gun. This is not evidence that Iraq had a nuclear weapon but it is evidence that the Iraqis concealed plans to reconstitute their nuclear program as soon as the world was no longer looking -- Lou.

DOBBS: David, is there any indication as to how long it would have taken if these materials had been unearthed and been put into operation how much a lead that would have given the Iraqis in developing nuclear weapons?

ENSOR: Well, both Mr. Obeidi and other experts have told us that they think it would have saved Iraq three or four years just to have what was buried in his backyard still in place. Those parts, it allows you to reproduce those parts if you have them.

They're like templates and the Iraqis would have been able to produce hundreds of them, thus building a lot of gas centrifuges. If you'd had, say, 2,500 gas centrifuges operating for a year you'd have had enough enriched uranium for one nuclear weapon -- Lou.

DOBBS: David, thank you very much, David Ensor our National Security Correspondent.

We'll have much more on the evidence of Iraq's secret nuclear weapons program later in the show. Our Mike Boettcher is in an undisclosed location and will have the very latest for us.

Tonight, perhaps as well a dramatic breakthrough in the effort to bring Palestinians and Israelis together, senior Palestinian officials say three radical Islamist groups have agreed to suspend their attacks against Israel for a period of three months but there is little hope of an immediate cease-fire after an Israeli air strike today and Hamas threats of revenge. Jerrold Kessel joins us live from Jerusalem -- Jerrold.

JERROLD KESSEL, CNN CORRESPONDENT: Lou, the Hamas leaders down in Gaza are saying that it's premature to talk about a fully concluded agreement but Palestinian officials confirming to CNN that the three radical groups have signed on to a preliminary agreement to cease for three months their attacks on Israelis and that will possibly, may probably Lou, mean the implementation of the very first phase of the road map, that peace initiative launched by President Bush to try to get the Israeli-Palestinian confrontation ended and he launched it three weeks ago in Aqaba, Jordan.

But today, it didn't look like there would be any cease-fire; in fact there wasn't any cease-fire. Israeli police intercepted two Palestinians with a major bomb, say the Israelis, which they managed to blow up and safety diffuse without any casualties.

And then later in Gaza, Israeli helicopters targeted a Hamas man who they said was out on a bombing mission against a Jewish settlement. They wounded him seriously but killed two Palestinian bystanders in that helicopter attack.

But, despite that cold water poured by the Hamas leaders on the ground in Gaza, the word is that the man who's been orchestrating this negotiating effort to get a truce in place bizarrely is behind bars in an Israeli prison, Marwan Barghouti, the grassroots leader of the Fatah movement, the mainstream movement in the Palestinian community on the West Bank.

He's charged by the Israelis with being responsible for organizing many of the attacks of recent years but from his prison cell he's said to have made this initiative and today came the word that Hamas and Islamic Jihad leaders in Damascus have sent the word back that they were ready to sign on to the three month cease-fire.

Yasser Arafat beleaguered in his headquarters in the West Bank gives his blessing to a truce but says it's not up to the United States to constrain Israel and make sure Israel gives a guarantee that it won't go on targeting Palestinian militant leaders.

But, from the United States, President Bush himself and the Israeli leadership, they say this is only the first step not nearly enough. Hamas must be dismantled completely.

But despite the hesitation on all sides, Palestinian and Israeli officials are saying this truce may become a reality any day soon, perhaps even formalized at a Palestinian meeting in Cairo at the weekend. As one official put it very, very bluntly what alternative is there -- Lou?

DOBBS: Hopeful developments tonight, Jerrold Kessel thank you very much reporting from Jerusalem.

President Bush for his part remains cautious about the possibility of an Israeli-Palestinian cease-fire. The president said peace will come only when terrorist organizations like Hamas are dismantled.

Our Senior White House Correspondent John King joins me now with the story -- John.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: And, Lou, the president is hoping that he has more clarity after his National Security Adviser Condoleezza Rice visits the region at the end of this week, but because there is now in the region, as Jerrold just noted, some confusion over whether this cease-fire will become a reality, there is a great deal of caution here at the White House.

(BEGIN VIDEOTAPE)

KING (voice-over): The president was openly skeptical that any cease-fire will truly stop attacks on Israel.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I'll believe it when I see it knowing the history of the terrorists in the Middle East.

KING: And, Mr. Bush was adamant that even if there is a cease- fire it would not be enough and in his view Hamas and other Palestinian militant groups must be put out of business.

BUSH: But the true test for Hamas and terrorist organizations is the complete dismantlement of their terrorist networks, their capacity to blow up the peace process. That's the true test.

KING: The Middle East and the war on terrorism dominated the annual White House summit with European Union leaders. The E.U. worked with the White House to write the road map to peace that Mr. Bush is trying to get Israel and the Palestinians to implement.

But France is among European nations which have ignored a White House request to isolate Yasser Arafat, and the E.U. so far has resisted U.S. pressure to list the political wing of Hamas as a terrorist group, which would allow its assets to be frozen.

BUSH: I urge the leaders in Europe and around the world to take swift, decisive action against terror groups such as Hamas to cut off their funding.

KING: This was the first U.S.-E.U. summit since the Iraq war strained transatlantic ties but there is a united front now on Iran. Leaders demanded that international inspectors have full access to its nuclear facilities.

ROMANO PRODI, E.U. COMMISSION PRESIDENT: Because we have to be sure that doesn't constitute a danger to future peace. We have to be absolutely sure.

BUSH: Yes. If the world speaks together, they'll comply.

(END VIDEOTAPE)

KING: Now, despite the president's very public skepticism some senior White House officials say a cease-fire could, emphasis on could, be a step in the right direction provided, they say, it is just a first step and that it is followed immediately by efforts to disarm Hamas and other Palestinian militant groups -- Lou.

DOBBS: Perhaps tonight, John, on the brink of a breakthrough in what has been an intractable impasse between Israelis and Palestinians for half a century.

KING: A confusing situation, Lou, and look for Condy Rice in her new, much more visible, role to be the president's point person when she gets to the region by the end of the week.

DOBBS: John, thank you very much, John King, Senior White House Correspondent.

The general who would lead the Central Command, which would of course include the U.S. forces in the Middle East, today said difficult days lie ahead in Iraq. Lieutenant General John Abizaid's comments came one day after six British soldiers were killed in southern Iraq, Senior Pentagon Correspondent Jamie McIntyre reports.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): The failure of U.S. troops to encounter any weapons of mass destruction on the battlefield after U.S. intelligence insisted they were deployed and ready for use was as big a shock to the U.S. general who was second in command as it was to anyone.

LT. GEN. JOHN ABIZAID, U.S. CENTRAL COMMANDER NOMINEE: I am again perplexed as to what happened and I can't offer a reasonable explanation.

MCINTYRE: Lieutenant General John Abizaid, a deputy to General Tommy Franks and nominated to succeed him as U.S. Central Commander in charge of Iraq and Afghanistan told Senators at his confirmation hearing he now thinks U.S. intelligence may have misread what the Iraqis were up to.

ABIZAID: Before the war, we picked up movement at the depots that we thought meant that they were certainly moving things forward for use in military operations. It may very well have been that they had received the order quite to the contrary to get rid of them.

MCINTYRE: With the number of anti-American attacks on the rise, Abizaid also predicted no quick improvement in the security situation.

ABIZAID: We are certainly in for some difficult days ahead periodically.

MCINTYRE: These exclusive photographs, obtained by CNN, show what the Pentagon says is the disregard America's enemies have for international law. The rocket-propelled grenade that ripped through this clearly-marked ambulance last week killed a U.S. medic and injured the driver and patient. ABIZAID: They believe that two casualties today, two casualties tomorrow, four the next day will eventually drive us out and it is a belief that they hold firmly and we need to be just as firm that we can't be driven out.

MCINTYRE: Abizaid cited three distinct groups behind the recent attacks, first residual Ba'athist activity, remnants of the old regime; second, radical anti-American Islamists, not aligned with Saddam Hussein but who seek to install an Islamic government; and last, well armed criminal elements who are trying to capitalize on the power vacuum.

(END VIDEOTAPE)

MCINTYRE: Abizaid said the U.S. will need to maintain a large number of troops in Iraq for "the foreseeable future" although he did hint he may be able to send some home after a review of the current offensive operations he's scheduled for next week -- Lou.

DOBBS: Jamie, General Abizaid's description of those elements assaulting coalition forces certainly goes beyond what the defense secretary has called dead-enders.

MCINTYRE: That's right. He gave a much more complete picture, and you notice he used that term radical Islamists and he said he used that specifically because he said the activity of these anti-American groups is not very Islamic in its nature -- Lou.

DOBBS: Precisely, we use the same term here. It is to describe the very same groups. Jamie McIntyre our Senior Pentagon Correspondent, thank you.

The Pentagon is closely watching developments in the civil war in the West African country of Liberia. Several rockets hit the U.S. Embassy compound in the capital of Monrovia today. A number of Liberian civilians were injured in the attacks. There were no American casualties.

The U.S. Embassy in Kenya today reopened after it was shut down for five days. The closure of the embassy followed the threat of an al Qaeda terrorist attack.

The nuclear standoff with North Korea tonight continues. No sign of any breakthrough; in fact, relations between North Korea and South Korea have worsened in recent months, Kitty Pilgrim reports.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): More than a million North Koreans rallied to mark the 53rd anniversary of the Korean War brought to your courtesy of North Korean state run TV. They were protesting against what they called U.S. imperialism.

These days you can see the same thing in the south, anti-American demonstrations. Nevertheless, 37,000 U.S. troops risk their lives on the Korean DMZ as they have for more than 50 years. Experts say the Korean mess is clearly worse lately and the only given is the U.S. still largely foots the defense bill.

North Korea now officially admits it has nuclear weapons. South Korea's President No, after 100 days in office, overwhelmed and exhausted recently admitted he "feels like calling it quits."

His latest headache, an independent investigation, found his predecessor paid North Korea $100 million for a so-called historic summit. The then leader of South Korea Kim Dae Jung even got the Nobel Prize for it. The current president is now working on slime control.

ROBERT DUJARRIC, HUDSON INSTITUTE: President No has not asked that the prosecutor's work be stopped, he doesn't want the entire former administration to be totally sullied by what could be discovered by an independent prosecutor.

PILGRIM: South Korea made much of getting its act together with the north. Now, it's disintegrated into talk of nukes, so much for the sunshine policy.

BALBINA HWANG, THE HERITAGE FOUNDATION: The North Korean leadership made many promises to South Korea and so far it is has been unable to unwilling to keep those promise and that is really the impasse that we are at right now.

(END VIDEOTAPE)

PILGRIM: Now, experts say North and South Korea relations could be further damaged by the corruption probe and the United States just wants to get on with the real issue which is North Korean nukes. It's not an easy solution here -- Lou.

DOBBS: And solution lies principally with China.

PILGRIM: I would say that they have to get very much involved.

DOBBS: Kitty, thank you very much, Kitty Pilgrim.

Still ahead here tonight in our special report on Border Patrol, the smuggling of illegal aliens is rising at a staggering rate despite aggressive efforts to stop it. Casey Wian will have our report.

And, new evidence of Saddam Hussein's secret nuclear weapons program, our Mike Boettcher is in an undisclosed location and he will have the very latest on that important story for us next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The Federal Reserve today lowered a key short term interest rate by a quarter of a percent. The Fed funds rate now stands at one percent. That is the lowest level in 45 years. It is also the 13th time that the Fed has cut rates in the past two years.

The Fed said in its commentary that the chance for deflation, while minor, exceeds that of a rise in inflation, and in point of fact the inflation rate over the past 12 months, core rate of inflation running at 1.6 percent.

Blue chip stocks down sharply after the Fed's announcement, many investors apparently hoping for an even greater interest rate cut. The Dow Jones Industrials down 98 points on the day. The NASDAQ dropped three points. The S&P 500 off eight points. Treasury prices also tumbled.

Susan Lisovicz is here now with the market for us, Susan, quite a day.

SUSAN LISOVICZ, CNN CORRESPONDENT: Quite a day and quite a turnabout. The Dow, as you know, sold off sharply after that announcement and at its low threatened to fall below 9,000.

Lou, as you mentioned many traders said a 25 basis point cut was already priced into the market but the accompanying statement reinforced the confusion on the status of the economy.

Before that decision there were more mixed signals on that very point. Durable goods orders fell slightly when an increase was expected indicating continued weakness in manufacturing but housing remains on fire. New home sales surged last month, the best one month gain since 1993.

Cyclicals among the worst performers on the day including Dow component Procter & Gamble, financials turned negative after the announcement on interest rates, among them Goldman Sachs which reported a 23 percent jump in its second quarter net income.

Freddie Mac gained better than one and a half percent on word that it will upwardly revise its earnings for the past three years, but Carnival was sunk on earnings that fell short because of continued weak bookings. As you mentioned, Lou, bonds tumbled. The ten-year Treasury note lost more than one point, the 30-year Treasury sank around two.

Lou, some analysts say the Fed was trying to speak to both the stock and bond markets, the Fed stated belief in the recovery gives the equity market something to hold onto while its concern about deflation keeps pressure on those yields.

DOBBS: And they all hope all the while, this economy according to the Fed statement looks stronger than it was but not to their complete satisfaction.

LISOVICZ: Not yet anyway.

DOBBS: Susan, thank you very much, Susan Lisovicz.

Seventy-three executives in all of corporate America have been charged with crimes, 16 from Enron, Sam Waksal the only executive headed for jail. It's been 569 days since the corporate corruption scandal began with the bankruptcy of Enron.

Coming up next fighting forest fires before they happen, Bill Tucker reports on a widening controversy between lawmakers and environmentalists.

Also ahead, affirmative action and the Supreme Court's split decision, Professor John Maginnis of Northwestern Law School and Frank Morris, adjunct professor at George Washington Law School will be in our "Face off" tonight.

And later, professional basketball fouling out with fans, Peter Viles reports on the trouble with the NBA.

(COMMERCIAL BREAK)

DOBBS: Wildfires continue to burn across the southwestern part of the country tonight. The massive Aspen fire in Arizona has now been burning for more than a week. Nearly 27,000 acres have been scorched in that fire, almost 350 homes and businesses destroyed but now calmer weather is helping firefighters there make some progress in a battle that most expect will take another two weeks.

Fireworks may have sparked a 700-acre fire in Albuquerque, New Mexico. That fire burned through the brush along the Rio Grande River, 16,000 people lost power, and more than 1,000 others were forced to evacuate their homes.

Tomorrow, Congress begins hearings on a bill that aims to prevent the spread of wildfires. President Bush's Healthy Forest Initiative is highly controversial. Environmentalists are adamantly opposed. Others question whether it will really help control wildfires.

Bill Tucker has the report.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Forty-two thousand acres in Arizona, 35,000 acres in New Mexico, and another 42,000 are burning in Alaska and the fire season is just underway, and with a lingering drought throughout much of the west, the outlook is bad.

DALE BOSWORTH, CHIEF, U.S. FOREST SERVICE: In the west, we're going to have to learn to live with fire. In order to do that, we're going to have to work together as a society up front and come to agreement on the need to do some active management.

TUCKER: Fires consumed over seven million American acres last year and that's the worst year on record. The government spent $1 billion fighting those fires. The administration is proposing to thin the force, cutting down the underbrush, and allowing logging to decrease fire conditions. The critics of the legislation say the priority shouldn't be the forest, it should be the communities and the people.

MICHAEL FRANCIS, THE WILDERNESS SOCIETY: If the federal government is only spending $400 million a year, which is what the Congress has been appropriating over the last few years, then we need to prioritize where we spend that money. We think the first priority is in close within a half mile of communities so we protect people in their homes. TUCKER: In fact, the Wilderness Society would be happy to let fires which pose no threat to communities simply burn themselves out naturally. So, why live in an area of high fire risk? Well, you can still cover yourself with a homeowner's insurance policy.

CANDYSSE MILLER, INSURANCE INFORMATION INSTITUTE: If you choose to live in a hillside area that has narrow, winding roads and a volunteer firefighting force, just be aware you're going to pay more for insurance.

(END VIDEOTAPE)

TUCKER: Well, the biggest opposition to the proposed Healthy Forest Initiative is that it speeds up the process of thinning forest areas deemed at risk and there are plenty who argue that the theory is good but that the practice is unproven -- Lou.

DOBBS: So, what's the likely outcome?

TUCKER: It's already passed the House. The Senate takes it up tomorrow and it is likely to pass in the Senate. If it does the president will sign it.

DOBBS: OK, Bill Tucker, thank you.

When we continue Saddam's secret nuclear weapons program, we'll be going live to Mike Boettcher for the very latest on new evidence uncovered by the CIA in our exclusive report.

And losing the battle at the borders, our special report continues, Border Patrol. Casey Wian looks at gaping holes in our security along the Mexican border.

Michael Garcia of the Bureau of Immigration will join us and two leading experts face off on the issue of affirmative action and its far-reaching effects on admissions and employers. Stay with us.

(COMMERCIAL BREAK)

DOBBS: We return now to our top story of the evening. The exclusive report that Iraq appeared to have had a secret plan to restart its nuclear weapons program before Saddam Hussein was overthrown. CNN's Mike Boettcher has more on the story, joins us live from an undisclosed location in the Middle East. Mike, what more can you tell us about the apparent apparatus that would have been helpful to the nuclear weapons program?

MIKE BOETTCHER, CNN CORRESPONDENT: Well, Lou, they were sample components for a gas centrifuge. Now, this is a piece of equipment that can enrich uranium and make it bomb grade. What is known now by the CIA and other U.S. government officials because they obtained this material and documents relating to it is that the Iraqis, number one, were way ahead in developing this program, could have put it together with the components they had and the information in about three years, according to top nuclear scientists. On the other hand, the scientists who turned it over to them, Lou, said that there was no program after '91, that he was ordered in 1991 and other top nuclear scientists to take various components and kits, as they were called, with the various plans and diagrams for this centrifuge and hide them. He hid it under a rose bush in a barrel in his garden, and there it stayed for 12 years and there he lied about it for 12 years until Baghdad fell to coalition forces, and at that point, he decided he wanted to cooperate with the United States, and he did, Lou.

DOBBS: Mike, this raises the question -- other scientists perhaps with other pieces of equipment that would be relevant to a nuclear program, perhaps a biochemical program. Is there any indication from Obeidi or from your sources in the CIA that this is going to be a broader opening?

BOETTCHER: Well, in Obeidi's views, he believes it will be broader because he says other scientists are watching what happens to him. He says others are willing to come forward, but they want to see how the U.S. is going to treat him. Is he going to be tried as a war criminal, which it appears he won't be. Is he going to be held in custody?

On the other hand, will his family be given safety? Will he be taken somewhere where he can give information and then start a new life? He believes this is called the soft touch, and he believes this is the way to deal with Iraqi scientists. He believes since he has successfully turned over this information and left the country and is cooperating, that other scientists will follow suit.

He says when he went in 1991, Lou, to pick up that particular gas centrifuge kit, as he called it, there were three others there at the office he went to, and he doesn't know where those three others are, although he's given information to the U.S. about scientists that they may want to question about those other three kits.

DOBBS: Now, Mike, as you know very well, a lot of controversy has followed the discovery of whether it be mobile labs or what appeared to be chemical agents, and a lot of controversy over the actual use and content of those elements. Is there any other purpose for this material that Obeidi has turned over to the United States?

BOETTCHER: No, it's not dual use. He says precisely that this was to make a gas centrifuge to enrich uranium. It would have taken several dozen of them to enrich enough uranium in a period that would have taken about a year or so once they had that gas centrifuge built. He believes that would have taken maybe another two years or so. So a total program of two to three and a half years. And he believes it was kept solely for the purpose of reconstituting the program once Saddam thought it was safe.

In terms of other programs, other weapons of mass destruction, biological or chemical, he says he does not have any information on that. And he says that the entire nuclear program was basically inactive, he believes, for the last 12 years, although he did reveal tonight when I spoke to him that in 2002 there may have been a parallel plan to conceptually bring back that gas centrifuge program, a plan to perhaps take this forward to its step when Saddam thought it was safe to try to build a bomb again.

DOBBS: Mike, thank you very much. We appreciate it. Mike Boettcher with a very important story. And for a number of reasons, we have to say only that Mike Boettcher's reporting from an undisclosed location this evening in the Middle East.

Turning now to the nation's borders and the fight against illegal immigration. Despite new technology and more agents, the number of people arrested trying to cross the U.S./Mexican border is on the rise. Up 10 percent over the past eight months.

But as Casey Wian reports in our special series on safety and security at the nation's border, immigrant smugglers are becoming more desperate and innovative.

(COMMERCIAL BREAK)

CASEY WIAN, CNN CORRESPONDENT: There's no question much of the U.S./Mexico border has become more secure. With added border patrol manpower and equipment, including new helicopters, towering cameras, boats with more range, and remote sensors that can detect desert foot traffic.

UNIDENTIFIED MALE: That information is submitted directly to the FBI.

WIAN: Computer systems are being upgraded so agents know if illegal border crossers have criminal records. Still they keep coming.

BRUCE WARD, LEGACY INS. PORT DIRECTOR: What we're seeing is a big increase in vehicle smuggling. People getting into trunks of cars, specially built compartments. Last week -- a couple weeks ago we had a would-be nun that was not a nun smuggling and she had someone in the dashboard of the vehicle.

WIAN: Border clamp downs have pushed human cargo into dangerous desert and mountain crossings.

TODD WATKINS, BORDER PATROL AGENT: The fact that they would even try it I think demonstrates the desperation. Is it is common for the alien smugglers to leave behind members of the group who can't keep up. I've seen pregnant women walk up and surrender on top of the mountain because they got left.

WIAN: Maria Amaya, (ph) is one of the American victims of changing smuggler tactics.

UNIDENTIFIED FEMALE: They go in that direction behind that bush.

WIAN: The once peaceful 10 acre home near the border has been overrun by smugglers who steal water, food and clothes.

UNIDENTIFIED FEMALE: I hate them. There's no one spot of my property that is -- that hasn't been invaded by them.

WIAN: Than last year she was hospitalized for two months after a nighttime crash on this interstate with a van full of illegal immigrants driving the wrong way with their lights off. She's been devastated financially. The border patrol says it's placed sensors near her property.

(on camera): This is the most heavily guarded stretch. There are two fences, one about seven feet high over there, another one about 15 feet high. And it is under constant surveillance by U.S. Border Patrol Agents. Despite that, some immigrants manage to find ways of getting across here.

(voice-over): Some go underground, literally. This is the end of a tunnel recently discovered by the border patrol in a public mark parking lot just a few hundred feet from the world's busiest land border crossing. It was mainly used for drugs.

BEN BAUMAN, U.S. BORDER PATROL: One person would crawl through tunnel form the Mexican side, and reach this chamber. And he would pass packages of marijuana to another person who would be in the storm drain. He would have to then pass them up through this slot to another person that would be lying underneath the truck with a false bottom.

WIAN: Agents only discovered the truck because of the strong smell of 3300 pounds of marijuana. The suspect says they moved several loads weekly. Authorities have discovered six similar tunnels since border security was tightened after 9/11.

MICHAEL VIGIL, DEA SPECIAL AGENT IN CHARGE: The tunnels are of great concern because today it could be drugs and illegal aliens. And then tomorrow it could be weapons of mass destruction and, you know, a terrorist coming through those tunnels.

WIAN: The DEA says it's working with the military on technology to identify tunnels because agents are convinced many more exist.

(END VIDEOTAPE)

WIAN: Homeland security agents are also mobilizing forces inland, place like Sky Harbor Airport in Phoenix and at safe houses here in southern California. Both are popular transit points for immigrants and smugglers who have made it across the border -- Lou.

DOBBS: Casey, thank you very much.

Casey Wian, reporting from Los Angeles.

Our next guest has made a career of capturing and prosecuting illegal aliens and terrorists. As the head homeland security's investigative arm, Michael Garcia is responsible for a broad range of issues from terrorist financing to immigration fraud, along with enforcing custom laws within this country. Prior to his current job, Garcia was a federal prosecutor who participated in the successful prosecution of four defendants in the first World Trade Center bombing trial.

Michael Garcia joins us now from our studios in Washington, D.C.

Good to have you here.

MICHAEL GARCIA, BUREAU OF IMMIGRATION & CUSTOMS ENFORCEMENT: Thank you.

DOBBS: As Casey Wian's report suggested, our borders are still easily crossed, far too many illegal aliens cross our borders.

That raises the question, could terrorists as easily do so?

GARCIA: Well, Lou, Any time you have a vulnerability at the border, it could be to smuggle contraband or aliens, you have something that could be exploited by terrorists or others seeking to do harm to our national security. We look at our vulnerabilities at the border in that way.

DOBBS: And a great deal has been done since September 11. But to see the number of arrests as we reported, rising, the number of people crossing the border up 10 percent in just the past eight months, why is that occurring in your judgment?

GARCIA: I think a number of factors. It's a difficult number looking at arrests. It could be part of that is due to increased enforcement, the larger presence on the border. Better use of technology at the border resulting in more people being apprehended. Not necessarily in more people attempting to cross.

DOBBS: Your agency is involved in intelligence as well as enforcement, investigation.

Is it your sense that you are being more effective in dismantling illegal alien smuggling operations or are they glowing up as quickly as you can if you will, bust them?

GARCIA: No, clearly we're being more effective. And the case in point is the Victoria smuggling case, tragic case involving 19 people found dead in the back of a tractor trailer down in Texas. We're a new agency. We're approaching these alien smuggling cases with the new tools that you mentioned that we inherited from customs, from immigration. In that case we brought down financial experts, we brought down investigative support assets from customs, air and marine division that was formerly in the U.S. Customs Service and our smuggling agents very successful investigation. 12 people in custody, a very short period of time.

Including the ring leader that was recently lured back from Honduras. I think we have to look at these cases in that ways. Look at them as organized crime. Approach them aggressively as organized crime. And then bring every tool that we have in our arsenal, customs, immigration, air and marine service, bring it to bear on these organizations and dismantle them. And I think we were very successful in Victoria. And I think we will use that as a model going forward as to how we approach this old problem with the new tools we have.

DOBBS: Would it be helpful to homeland security, to your agency, to border patrol, to customs if -- because we are in a war against terror -- there was simply a national policy on how we're going to deal with the issue of illegal immigration to this country?

GARCIA: There is policy, there are laws, there are regulations. We're charged with enforcing them. I think what's the most helpful thing that we can have is a clear-cut enforcement strategy. We work closely with CVP, with other components in homeland security. And the way we're going to get at the problem, as I said before, bring the new tools to bear on the problem. Bring the advantages that we have from this organization, homeland security, to bear and enforce the law in a meaningful way. Prioritizing our assets where we see the greatest vulnerabilities.

DOBBS: That is a wonderful spirit for one who's responsible for much of this enforcement to take and to espouse. But the fact is 700,000 illegal aliens crossed into this country last year, an estimated 700,000, I should say. Those estimates are the government's. We are in a situation in which business interests are sponsoring, in many cases, those people.

They are employing them in not only citrus groves but in urban centers throughout the country, individuals. Are you not going to have to attack those interests as well to be effective?

GARCIA: Clearly so. And there has been an historical program called worksite enforcement. It has gone through a number of permutations. Our main focus, in terms of work site now, is on employers who place their workers in dangerous conditions, who are abusive to their workers. Clearly a resource issue.

You cited some of the numbers that have been set out. We have limited resources. We attack the problem that way. We attack it by looking at critical infrastructure, tarmac operations, airport facilities, nuclear power plants. Where can we do worksite enforcement where it will make the greatest difference for national security?

I think you have to be realistic in looking at the problem and look can at what are the resources we have and how do we use them.

DOBBS: Well, one of the propositions that has been put forward variously, is with the amount of manpower that can be brought to bear, why not with U.S. troops stationed and involved in 100 countries around the globe, why not use U.S. military forces to make a border secure if that is indeed the will of this administration, this Congress and the U.S. government?

GARCIA: Clearly using military at the border raises certain issues. There's been some involvement with the national guard in building some of the fences that you showed, I think earlier, in your clips down by San Ysidro (ph).

I believe that the best way for us to patrol the border and enforce the law down there, is no have a fully staffed border patrol, inspectors at the border backed up by a robust interior enforcement group.

DOBBS: Michael Garcia, we thank you very much for being with us.

GARCIA: Thank you very much, Lou.

DOBBS: Thank you.

That brings us to our poll question tonight. With U.S. military personnel stationed around the world in more than 100 countries, the same question I put to Michael Garcia. Would you support stationing military troops along the U.S. border to stop the flow of illegal aliens? Definitely both borders, Definitely the Mexican border, in some cases, and never. Please vote at our web site CNN.com/lou. We'll have the results for you later in the show.

Here are the final results of yesterday's poll question. We ask how likely you are to consider buying cheaper drugs. 65 percent said a lot, 10 percent said somewhat, 5 percent a little, 20 percent said not at all

Our nightly check of the national debt. It stands at more than 6 trillion 600 billion, up more than 5 billion dollars overnight.

Still ahead here, facing off. Tonight affirmative action. Will the latest decision change the job search process as well as school admissions? John Mcginnis of Northwestern University law school, Frank Morris a partner of law firm, Epstein, Becker, and Green joins us next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight's face-off topic, the Supreme Court decision on affirmative action. John Maginnis, constitutional law professor at Northwestern University who says race conscious admissions policies are incorrect. Frank Morris adjunct professor of law at George Washington University law school who supports affirmative action and says it's good for business.

Gentlemen, good to have you here. Frank, let me begin with you. This court decision, does it confound or clear the way for proper understanding in this country on affirmative action.

FRANK MORRIS, PROFESSOR OF LAW, GEORGE WASHINGTON UNIVERSITY: I think very much, Lou, it helps to confirm what is the permissible reach of seeking to outreach and bring in a diverse work force or diverse student body. The court that either employers or schools, now know, what is permissible versus what is impermissible. And mainly what's impermissible is when it borders on being something like a quota as did the 20 point program.

DOBBS: John Maginnis?

JOHN MAGINNIS, CONSTITUTIONAL LAW PROFESSOR, NORTHWESTERN UNIVERSITY: Well, I think this is a -- gives states license to discriminate. It's not simply a question of outreach. It gives them the ability to give very large preferences to people on the basis of their race or ethnicity. And these people do not have to be -- have to have been discriminated against. These may have been people who have come to this county, enjoy the bounty of this country and they receive very substantial preferences of a grade.

So I really don't see this as a limited decision in any way. It's a real license for states to discriminate.

MORRIS: Well, hardly, because what happens here is -- and this refers to business very much, too -- business wants the broadest possible range of thought, of experience, to sell in the global competitive marketplace. To be able, also, to credibly market to every niche of society.

And what this decision does is helps to affirm that the kinds of things that businesses has done, to recruit its particularly minority institutions, to set up internship programs, to set up special training programs, each and every one of those things now is entirely confirmed as a permissible outreach effort.

MORRIS: I do not believe that individual constitutional rights should be sacrificed for corporate profits. Moreover, I don't think it's necessary. This decision about the constitution is limited to state actors, to state universities.

There's no difficulty with Congress amending either title seven, amending title six to allow certain kinds of discrimination. But what is very disturbing about this is this decision allows states to discriminate in a very fundamental way with very large preferences to people who have suffered no discrimination in this country. And therefore, we are going down the road of allowing the state to inculcate race consciousness in this country.

DOBBS: Frank Morris, let me ask you this. Sandra Day O'Connor, a 5-4 vote in the court, said if this were 25 years hence, she would likely not make the same -- intimated -- that she would not vote the same way, that is, in favor of the University of Michigan's policies. What is the appropriate time for affirmative action? Do you concur it should expire at the given point in the future?

MORRIS: I think justice O'Connor's point was Bochy was about 25 years ago. What we've seen is enormous progress through the entry level, through midlevel ranks. And what Justice O'Connor focused on was that whether it be in business, the universities, the military or elsewhere, what this decision does is provide the basis for a period of time into the future. And she suggested 25 years would certainly be enough to see that there is full diversity through throughout the ranks, whether it be in business or in schools as well.

MCGINNIS: This is unnecessary to allow people of different races to go into business. The University of Michigan is an extremely elite school. People who are rejected at the University of Michigan will get into other private schools on their own merits and will be able to compete here. Moreover, this papers over the real problem for our long-term diversity, which is the very poor education many minority groups receive in the inner cities. That should be the focus of our effort rather than engaging in discrimination that may help a few people but that papers over the problem.

DOBBS: Let me ask you both, Tom DeLay, the majority leader in the House, said as far as he could tell, the Supreme Court decision ruled aggressive affirmative action is bad but subtle affirmative action is good. Greg Morris, how do you respond to that?

MORRIS: Well I think the difference is when the, quote, affirmative action becomes a situation where you have effectively have a but four decision made. When you give 20 points out of 100 necessary, you have created a circumstance where, according to the record in the case, virtually every minimally qualified individual would have been admitted. That's the difference between what approaches quotas versus the kind of activities that I identified where we are bringing in a diverse, either student body or workforce. And that's what we are looking for.

MCGINNIS: I disagree with that characterization. The difference is that a covert discrimination is permitted. Overt discrimination -- that is extremely clear -- when you give people different percentage points. But the discrimination is still very dramatic. At the University of Michigan, people of one race are admitted when circumstances statistically people of another race would almost never be admitted. So, it's a very large preference so long as they don't announce exactly what that preference is.

That's one of the other disturbing parts of this decision, that it makes discrimination covert and nontransparent. So the citizens of the country can't see it and therefore react as they did in proposition 209 and ban it at the state level.

DOBBS: Greg Morris, the last word this evening.

MORRIS: Well, thank you, Lou. In fact, what we have here is we're trying to see that elite institutions -- and we've counseled employers for years at our law firm -- that what you're looking to do is enhance the pool and get the most qualified individuals. But we want to see as employers that that includes every group. And there is no reserving of particular positions. That's when I would agree that there's a problem, if a position is reserved.

But diversity in affirmative action should not, properly interpreted, mean that. And that's what Justice O'Connor said.

MCGINNIS: But I think the difficulty here is we have very large preferences that aren't necessary. The people who get into the University of Michigan can go elsewhere. They can go to private institutions. We're allowing the state to discriminate. That's a very dangerous road to go down.

DOBBS: Let me ask you both, quickly if you would, answer to one question, will this spur further litigation, greater controversy, this decision by the supreme court or less?

MCGINNIS: Will be litigation around the edges. My own belief, sad belief, is that this will institutionalize race conscious decisions without much litigation for generations.

DOBBS: Frank?

MORRIS: Well, I think that, in fact, there will be much less litigation. It's a political issue and will be waged by propositions and so forth. But in terms of a road map, where litigation can be avoided, the Supreme Court has helped provide that road map.

DOBBS: Frank Morris, John Mcginnis, gentlemen, thank you very much.

Still ahead, we take a look at your thoughts on the many Americans who are leaving this country to buy cheaper prescription drugs. We'll also have the results of tonight's poll. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The preliminary results, now, of our poll question tonight -- with U.S. military personnel stationed in more than 100 countries around the world, we asked, would you support stationing military troops along U.S. borders to stop the flow of illegal aliens? 51 percent of you said definitely, both border, 21 percent said definitely the Mexican border, 9 percent said in some cases, only 20 percent of said never. You can continue to vote on this issue on our Web site, CNN.com/lou. We'll have the final results tomorrow night.

Taking a quick look at your thoughts, we received a lot of e-mail about our story on Americans who try to save money by buying prescription drugs overseas, only to buy counterfeit drugs.

Karen Gast (ph) of Texas said, "I find it ridiculous that people who buy cheaper drugs from other countries are willing to risk their lives in order to save money. Do these people not realize that most of these drugs are not approved by the FDA."

Peter Morango (ph) of North Carolina said, "the argument that drug companies have to charge Americans higher prices to fund research is bull. They are motivated by shear greed."

And Julie Springer of Nebraska said, "I work at a hospital and everyday see meals, trinkets, vacations, gift certificates, etc. that drug companies give physicians. This enormous amount of money should, instead, be used for research or to help lower the cost of drugs."

Thanks for sharing your thoughts. We love hearing from you. Send us your e-mail, loudobbs@CNN.com.

Thanks for being with us tonight.

Tomorrow we look at one way to deal with illegal immigration into this country in our special series of reports border patrol. And I'll be joined by the Senate Majority Whip Mitch McConnell. Senator McConnell will be here about the battle over Medicare reform. 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



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