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LOU DOBBS TONIGHT

United States Issues Warning to North Korea and Iran; Victory in California For Opponents of Illegal Immigration

Aired December 2, 2003 - 18:00   ET

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

LOU DOBBS, CNN ANCHOR: Tonight: The United States issues a blunt warning to North Korea and Iran about their nuclear weapons ambitions. National security correspondent David Ensor reports.
The Sharon government forgets itself and tries to tell Secretary of State Colin Powell what to do. The secretary of state offers the Sharon government a gentle reminder of his prerogatives.

In "Broken Borders" tonight: Opponents of illegal immigration win a dramatic victory in California, thanks to the Terminator. Illegal aliens will no long be able to obtain California driver's licenses.

In our special report, "Exporting America," the president's brother, Neil Bush, has a $200 million consulting contract with a Chinese semiconductor firm. Lisa Sylvester reports.

And in "America's Bright Future," our special report on remarkable children and teenagers in this country -- tonight, a young scientist who has used his genius to help some of this country's most disadvantaged people.

ANNOUNCER: This is LOU DOBBS TONIGHT for Tuesday, December 2. Here now, Lou Dobbs.

DOBBS: Good evening.

Tonight: The United States has warned North Korea and Iran that materials for weapons of mass destruction will be seized on the high seas. A senior State Department official, John Bolton, said rogue states should know that their covert programs will not escape detection or what he called consequences. Bolton is one of the administration's most outspoken critics of North Korea, Iran and their nuclear ambitions.

The United States is trying to persuade both states to abandon their nuclear weapon programs.

National security correspondent David Ensor has the report.

(BEGIN VIDEOTAPE)

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT (voice-over): What you see in this training exercise could soon be for real, says the Bush administration, in this case, Japanese troops storming a ship in an Australian-led exercise, including U.S. forces, in October, searching for weapons of mass destruction or missile components on the high seas.

JOHN BOLTON, UNDERSECRETARY OF STATE: While we will pursue diplomatic solutions wherever possible, the United States and its allies are also willing to deploy more robust techniques, such as the interdiction and seizure of illicit goods.

ENSOR: It was a warning, Bolton said, especially to North Korea, Iran, but also Syria, Libya, Cuba and others, that trading in weapons of mass destruction parts is about to get harder.

BOLTON: There's no doubt that the international trafficking and WMD materials is extensive and it's being conducted in many cases by both buyers and sellers who have made solemn treaty obligations not to do what they're doing.

ENSOR: Stepping up searches and seizures at sea, in ports and airports is good, says one of Bolton's predecessors, but it won't solve the problem.

ROBERT EINHORN, CSIS: It will help, but rarely, rarely. I think, for every case where we have timely, actionable intelligence information, there will be at least 10 or more where we simply don't have that kind of information.

ENSOR: Also needed, legal authority and the will to seize what's found. The So San, stopped at sea by Spanish forces almost a year ago smuggling North Korean Scud missiles, was allowed to continue with its cargo to the buyer, Yemen, because Washington needs Yemen's help in the war on terrorism.

(END VIDEOTAPE)

ENSOR: Bolton also warned North Korea that the U.S. will insist on tough, explicit ways for the world to verify that Pyongyang really does give up all its nuclear weapons capability in any possible deal.

U.S. officials say, planning for another round of six-party talks on North Korea's weapons has hit a snag. They're now not likely to go ahead this month, as had been planned -- Lou.

DOBBS: David, first what prompted today's warning by Bolton?

ENSOR: Well, they're trying to -- sort of a shot across the bow, perhaps, no pun intended, to those who produce these weapons or who try to buy them, that it's going to be made much more difficult.

The U.S. has been working since May on a program announced by President Bush in May in Poland to try to get this kind of interdiction, particularly on the high seas, but also at airports and elsewhere, organized in such a way that they really can stop some of this trade -- Lou.

DOBBS: David, at the same time, as Einhorn suggests, there is extensive trade in these components that could be for nuclear weapons programs under way.

There is some credibility about the U.S. ability to detect with its sensing devices, its satellite intelligence. Precisely how does the administration in this case expect to be taken seriously, given the failure of intelligence, particularly in Iraq, to find weapons of mass destructions there, after months of suggesting there were weapons of mass destruction?

ENSOR: Well, as Mr. Einhorn noted, you're not going to get it most of the time.

As he said, he thought that there would probably be 10 shipments that they would miss. But there is that one that they will get. And that will be highly publicized when it happens. They did, after all, find Scuds on that ship on its way to Yemen. They let them go in the end. But the fact that they found them, knew they were there, that told the North Koreans something about what the U.S. is -- how much intelligence it has on what the North Koreans are up to -- Lou.

DOBBS: Certainly the Spanish.

Thank you very much, David Ensor. Appreciate it.

In Iraq today, about 1,000 American troops carried out a massive search and arrest operation in a town west of Kirkuk. That operation came two days after a fierce battle with insurgents in Samarra, north of Baghdad. Today, an American soldier was killed in the bomb attack in the same area. In Baghdad, contractors today removed one of the last remaining symbols of Saddam Hussein's regime.

Walt Rodgers reports.

(BEGIN VIDEOTAPE)

WALTER RODGERS, CNN SR. INTERNATIONAL CORRESPONDENT (voice-over): Saddam's head removed, but the still-at-large former Iraqi despot may well be taunting Washington: Where's the rest of me?

In Baghdad, Saddam had four massive heads of himself cast, each 30 feet, or eight meters, high, weighing seven tons. He fancied himself a great warrior, hence, the headgear, at times, Salahaddin, at others, Nebuchadnezzar. The U.S. administrator here in Iraq fancies Saddam's monuments to Saddam gone.

PAUL BREMER, U.S. ADMINISTRATOR IN IRAQ: We've been looking at these heads for six months and I'm just delighted to see them coming down. It's a symbol of how the regime that they represent is gone.

RODGERS: There was applause from the U.S.-led coalition at the head-lifting. But Iraqis remain too frightened to applaud just yet, especially with Saddam still eluding capture. This man should know. He used to work in the government.

GAILAN RAMIZ, IRAQI CITIZEN: The Iraqi people will continue to fear him. I think the public opinion is such that, from past experience, it shows that this man was always able to come back. RODGERS: As recently as last week, President Bush assured the Iraqi people, that will never happen.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The regime of Saddam Hussein is gone forever.

(CHEERING AND APPLAUSE)

RODGERS: The problem is, many Iraqis say the U.S. has a credibility gap in Iraq.

ABDUL SATTAR JAWAD, BAGHDAD UNIVERSITY: The failure to catch him is not in favor of the American forces. You must squeeze him as soon as possible. He is a sort of menace, a sort of threat. And he is a violent man.

RODGERS: The U.S.-led coalition has squeezed Saddam, driven him underground, made his loyalists bleed. But, at the end of the day, Saddam keeps getting away.

LT. GEN. RICARDO SANCHEZ, U.S. COMMANDER IN IRAQ: It is difficult to find him, given that I haven't found him, killed him or captured him. And I need the Iraqi people's help. And together, we'll find him. We'll capture him or we'll kill him.

(END VIDEOTAPE)

RODGERS: One gets the feeling here that the great majority of Iraqis would indeed sleep much, much more soundly at night if indeed the Americans killed Saddam Hussein. But the Iraqis are disappointed the Americans have not yet made good on that promise -- Lou.

DOBBS: Walt, assuming that Saddam Hussein, in the opinion of U.S. intelligence, remains in Iraq and other former officials, why is the Army finding it so difficult to detect them and, as General Sanchez said, capture or kill them?

RODGERS: It's a good question and it has an easy answer, Lou.

The easy answer is, most Iraqis don't have a clue as to where Saddam Hussein is. Again, from what I've gleaned here, most Iraqis would sleep much better nights if Saddam Hussein was killed. The problem is, it's believed that he's traveling with some of the desert tribes, the Sunni tribes. No one has a better chance of surviving than a man who has long been hunted. Saddam Hussein has been hunted for years.

Even when he was in power, he moved from palace to palace, room to room at night. We're even given to believe now that Saddam changes his bodyguards every day, because every bodyguard knows that there's a $25 million price tag on the real head of the real Saddam -- Lou.

DOBBS: Walt Rodgers, thank you very much.

The United States today issued an unusually specific warning about the possibility of new terrorist attacks in both Kenya and Saudi Arabia. In Kenya, the U.S. Embassy there said it has received an anonymous warning about a terrorist threat to two hotels in Nairobi. In Saudi Arabia, diplomats said terrorists have been watching a housing complex for Westerners in Riyadh. A U.S. official said al Qaeda may also be planning an attack in London or against British interests.

British police today arrested 14 people in anti-terrorism raids in three cities. Police did not say whether those arrests were connected to the threat of an imminent terrorist attack.

Joining me now to discuss the war on terror and the war against Saddam Hussein, former CIA analyst Ken Pollack, director of research at the Saban Center at the Brookings Institution. Ken has just returned from Iraq. He says the United States right now has the wrong military strategy.

Ken, why is that?

KENNETH POLLACK, CNN ANALYST: Well, Lou, let me be very careful here.

I think there parts of what the U.S. military are doing that are fine, that make perfect sense. There are actually a lot of U.S. military officers over there, soldiers over there, who are doing some very good work. But the fundamental problem is that, right now, I think we've got our priorities in Iraq reversed.

What leapt out to me in my time in Iraq, even talking to U.S. military personnel, who will say the same thing, is that there is a an excessive emphasis on force protection of U.S. forces, instead of actually protecting the Iraqi people themselves. The biggest problem for the Iraqi people is not necessarily attacks on U.S. soldiers. The biggest problem for them is the lawlessness and the crime in their society. That is the greatest impediment to the political and economic reconstruction of Iraq.

And, unfortunately, the U.S. is just not doing enough to help them. There aren't enough patrols on the streets. There aren't enough soldiers on the streets trying to make their neighborhoods safe. Instead, we mostly conduct mounted patrols, buzzing through streets at 30 to 40 kilometers per hour. They see nothing. They have no impact on the lives of Iraqis.

(CROSSTALK)

DOBBS: I'm sorry, Ken.

Paul Bremer, the administrator, says that we do not need more troops. The military command says we do not need more troops in Iraq. Paul Bremer brags about -- and, indeed, the administration brags about the fact that more Iraqis are being moved in to police Baghdad and other cities and towns throughout Iraq. What you're saying is, this isn't quick enough, there isn't enough manpower. What are you really saying on those issues specifically?

POLLACK: Sure. Very clearly, the manpower we have in Iraq is fine, given the strategy we have. I think the strategy we have is not serving our ends. It is not making the Iraqi people safe. And that is the greatest impediment to the reconstruction of Iraq. I think we need to switch to a different strategy, the strategy that we applied in Bosnia, in Kosovo, the strategy that the accomplish successfully in Northern Israel, one where we're out on the streets reassuring the Iraqi people, making them safe.

(CROSSTALK)

DOBBS: Would that require more American troops?

POLLACK: It is going to require more of somebody.

And the problem is that the Iraqis are not furnishing those troops fast enough. You've mentioned the Iraqi police, Lou. What everyone in Baghdad will tell you is that, since Bernard Kerik left Iraq, the Iraqi police have become completely corrupt. And no one trusts them, including the CPA personnel, the American personnel over there. They can't fill the bill. So either we come up with more American personnel or we go someplace else. And that someplace else has to be the rest of the world.

DOBBS: And part of what I hear you saying, Ken, is that, right now, manpower levels and the commitment to force in Iraq is, in effect, dictating strategy, rather than strategy dictating levels of force in Iraq. Am I hearing you fairly?

POLLACK: I think that that's a very reasonable assumption. It's clear that the U.S. has come to a decision about what kind of force levels.

But I do also think that part of the problem is that, over the last 20 years, the U.S. military has forced to become obsessed with force protection. Their sense is that, politically, the U.S. public won't sustain large casualties. So they make their first priority keeping U.S. casualties low. The problem with that is, if your first priority is keeping U.S. casualties low, it may mean that you're not accomplishing the mission. And that's the problem we have in Iraq right now.

DOBBS: The military of the world's greatest, indeed, only, superpower certainly, Ken, should not have to make a choice between force protection and other security and strategic interests. It should be able to accomplish all of those interests, should it not?

POLLACK: Absolutely, no question about it. And I think we can. And our troops know it. But they need to be allowed to perform the mission properly.

DOBBS: Ken Pollack, good to have you back. Thank you for being here.

POLLACK: Thank you, Lou. DOBBS: Israel likes to describe itself as one of this country's closest allies. But today, Israel once again demonstrated a remarkable lack of diplomacy in its relations with the U.S. Some say it might even be called defiance.

The Israeli government said Secretary of State Powell would -- quote -- "make a mistake" -- end quote -- if he met with authors of the new unofficial Middle East peace plan. Secretary Powell had a blunt response during his visit to North Africa today. Secretary Powell said he has the right to meet with anyone with new ideas on Middle East peace.

This is the second time in less than a month that Israel has snubbed the United States. Two weeks ago, Israel rejected a plea by President Bush to stop building a security barrier in the West Bank.

Coming up next: a cruel twist of scheduling fate for the president today. Traveling through steel town USA days before his expected decision to repeal steel tariffs. White House correspondent Suzanne Malveaux will report.

And the exportation of American jobs to China -- apparently, the president's brother not afraid to create a political issue for opponents of his brother. Lisa Sylvester will have the story.

And "America's Bright Future," our special report tonight on some of this country's most talented and brightest young people. Tonight, one young man whose invention makes it easier for the deaf to communicate with the hearing. Kitty Pilgrim will have his story.

(COMMERCIAL BREAK)

DOBBS: In a case of poor political timing by the usually savvy Bush White House, the president, who is expected any day to end steel tariffs that have helped U.S. steelmakers, today visited steel city.

White House correspondent Suzanne Malveaux has the report.

And, Suzanne, the president today didn't even mention the word steel?

SUZANNE MALVEAUX, CNN CORRESPONDENT: No, he didn't, Lou.

As a matter of fact, what was telling was what he did not say, no decision, no announcement on whether or not he was going to lift tariffs for the steel imports, a White House spokesman saying -- insisting, the president has yet to make up his mind, but administration and industry congressional sources all saying it's all but a done deal. It's not surprising either way, of course, Pittsburgh being steel city.

And that fund-raiser where he raised $1 million was co-hosted by the CEO and chair of none other than U.S. Steel. That is Thomas Usher. Now, we are told that the president and Mr. Usher spoke briefly before the president made his speech, that Usher made his views clear that he was not supportive of lifting that tariff. Also, of course, the president was confronted by protests as well. They were out of his sight, but, clearly, steelworkers, who were quite fearful that they'll be losing their jobs and they believe lifting these tariffs will cripple the industry.

(BEGIN VIDEO CLIP)

LEO GERARD, STEEL UNION PRESIDENT: We're here to make sure that the president understand that we expect him to keep his promise and that we don't expect him to get pushed around and roll over by threats from the European Union and the Japanese. And we want him to know that these people represent the heartland of America.

(END VIDEO CLIP)

MALVEAUX: Now, administration sources say that the economy really cannot stand the alternative. That would be facing more than $2 billion in sanctions from the European Union, China, Japan and other countries that have threatened to input -- to sanction those U.S. imports. But they also said, of course, the president is going to be making his decision and making an announcement within days -- Lou.

DOBBS: Suzanne, thank you very much -- Suzanne Malveaux.

With bipartisan support, the California Assembly voted 64-9 to repeal an unpopular new law that gives driver's licenses to illegal immigrants. Governor Schwarzenegger is expected to sign that repeal within days. That law's background and identity checks were widely viewed as simply too lax. Latino groups warn that they will protest the repeal of the opportunity for illegal aliens to have California driver's licenses. Governor Schwarzenegger says he'll work with Democrats to pass a more stringent version of that law next year.

Meanwhile, the investigation into driver's license fraud in Indiana has expanded. More than 100 foreign nationals used phony Social Security cards to obtain licenses there. Police are investigating whether Motor Vehicle Bureau employees were involved in the scam. Among the arrests, a volunteer translator for motor vehicle offices located throughout central Indiana.

Coming up next: President Bush's brother has been working for the Chinese. And millions of dollars in compensation are at stake in his consultancy. Lisa Sylvester will report from Washington.

And Democratic presidential front-runner Howard Dean squares off against an awfully big opponent in his quest for the Democratic presidential national nomination. He's taking on -- oh, my gosh -- the media. Peter Viles will report. Three of this country's top political journalists join us.

(COMMERCIAL BREAK)

DOBBS: Exporting technology and the jobs critical to supporting technology in the minds of some threatens our national security. So does the inability of this country to preserve a vigorous steel industry. And energy, of course, is also critical.

It is one thing to be dependent, as we are in this country, upon foreign oil. It turns out, we're also dependent upon foreign companies for the gasoline we buy at the pump. In fact, foreign ownership of gasoline retailers has almost doubled in the past six years. A new Lundberg survey finds foreigners own or control the brands of almost half, 42 percent, of all gasoline stations in the country.

In 1997, they owned 22 percent. Royal/Dutch Shell controls the most, almost 16 percent of all gasoline stations in the country. British Petroleum is next, 11.5 percent. Citgo controls almost 10.5 percent. Foreign-owned brands, such as Fina, Getty, and Circle K make up the remaining 4 percent. This report comes as the dollar today slid to a new record low again the euro. And that lifted gold prices to a 7 1/2-year high.

At a time when the trade deficit with China is exploding and technology jobs are being threatened by outsourcing to China and India and countries, President Bush may now be facing a political issue created by his brother. It turns out the president's younger brother, Neil Bush, has a consulting contract with a Chinese company.

Lisa Sylvester reports.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Neil Bush divorced his wife of two decades in April. Among the documents revealed in the divorce case was a contract agreement between the president's brother and a Chinese company, Grace Semiconductor Manufacturing Corporation.

The contract, dated 2002, promises one million shares of stock. Neil Bush's divorce attorney says he has not received any money from the Chinese company. In addition, Bush promises to provide the company with business strategies and policies. There's no indication the deal was improper or unethical. But it could not have been revealed at a worse time for the political implications it raises for his brother in the White House.

The U.S. trade deficit with China is expected to reach $130 billion this year. President Bush had promised to take a tough stand against the Chinese. Treasury Secretary John Snow was pressuring China to float its currency, something China has resisted because it would make products more expensive for Americans. And American workers have continued to lose jobs in the technology sector, as Neil Bush has been working with a Chinese firm.

CHARLES LEWIS, CENTER FOR PUBLIC INTEGRITY: There is sort of a callous message that kind of thumbs your nose at U.S. workers, that you're interacting with a company in China and getting a large sum of money in China for this work.

SYLVESTER: According to a report last month from the American Electronics Association, 48 states lost high-tech workers last year. China has been accused of siphoning jobs from various U.S. sectors, including textiles, furniture and the electronics industry.

LEWIS: The Democrats are trying to capitalize on everything they can get their hands on. It would be astonishing to me if the Democrats did not raise this as an issue.

SYLVESTER: It's not the first time Neil Bush's business dealings has created political fodder for opponents of the Bush family. In the 1980s, Neil Bush was a director of Silverado Banking, Savings & Loan that had to be bailed out by the federal government at a cost of $1 billion.

(END VIDEOTAPE)

SYLVESTER: Neil Bush has had a business relationship with the head of Grace Semiconductor that predates his brother's election as president. In fact, the CEO of Grace is said to be an investor in Neil Bush's private company. We tried to reach Grace Semiconductor and Neil Bush, and our calls were not returned. The White House had no comment on the story.

DOBBS: Lisa, thank you very much -- Lisa Sylvester reporting from Washington.

Coming up next here: Leading Democratic presidential contender Howard Dean says he'll take on a powerful opponent if he's elected president. Peter Viles will report. And three of this country's top political journalists join us.

(COMMERCIAL BREAK)

DOBBS: Surprising comments from Democratic presidential hopeful Howard Dean. He says there's too much media concentration in this country. He intends to do something about it.

Dean's position runs directly against the policies of both President Bush and, before him, President Clinton. But it could be in keeping with widening popular concern about consolidation of media power in this country.

Peter Viles reports.

(BEGIN VIDEOTAPE)

(APPLAUSE)

PETER VILES, CNNfn CORRESPONDENT (voice-over): Presidential candidates spend their days courting the media, spend most of their money buying television time. Yet Howard Dean is taking on media giants saying big media in this country is way too big.

HOWARD DEAN (D), PRESIDENTIAL CANDIDATE: Eleven companies in this country control 90 percent of what ordinary people are able to read and watch on their television. That's wrong. We need to have a wide variety of opinions in every community.

VILES: Dean went on to say he would, quote, break up the giant media enterprises, that would be a lot of breaking up. Mergers like the disastrous AOL Time Warner marriage have created six television giants, Time Warner, Disney, General Electric, Viacom, Fox and Liberty, that control 80 percent of prime time viewing, according to the Consumer Federation of America.

ANDREW JAY SCHWARTZMAN, MEDIA ACCESS PROJECT: I think Dean is tapping into a bipartisan trend that cut as cross party lines and has broad, popular support, a generalized sense that there's too few companies owning too many properties.

VILES: Big media has angered millions of Americans, shows like this one on Viacom's CBS network are part of the problem. One of the reasons Christian groups joined that unusual coalition last summer that fought the Bush administration push to let big media companies own even more properties.

ERIC BOEHLERT, SALON.COM: If you talk to conservative Christians they're concerned about the prime time programming. Their back lash issue is there's too much sex and violence on television. And if we have fewer and fewer people controlling it, they're part of the problem.

VILES: It's clear this a large movement. The FCC received an unprecedented 2 million E-mails and letters protesting higher ownership limits.

(END VIDEOTAPE)

VILES: The focus of media regulation right now in Washington is that cap, how many radio stations or TV stations can a single company own?

There's a sleeper issue to watch here and that's cable rates. Currently completely unregulated but rising so fast Congress is starting to pay attention.

DOBBS: The idea that Howard Dean could roll back, if he were elected president, these companies that has broad appeal.

What is the political, legal possibility of doing it in any way considered soon?

VILES: You would need some sort of massive piece of legislation to say these deals cannot stand, these concentrations cannot stand. It's hard to see that big media would lose a vote that big in the Congress. They lost a couple of small ones...

DOBBS: You're not suggesting big lobbying dollars from big corporations dictate our political future?

VILES: I'm suggesting exactly that. They did lose a small vote this summer but they are on their way to undoing the summer's lost.

DOBBS: Peter Viles, thank you very much.

Well, that brings us to the subject of "Tonight's Poll" question, do you agree that big media companies should be broken up, yes or no.

Cast your vote at cnn.com/lou. We'll bring you the results later in the show.

Joining me now, three of the country's leading political journalists, Karen Tumulty, national political correspondent "Time" magazine, Roger Simon, political editor of "U.S. News and World Report" and Ron Brownstein, national political correspondent "Los Angeles Times." Good to have you all here.

Karen, let me begin with, first, Howard Dean, rolling back the big media companies, the four of us associated with some of those. So we've got to disclose full I our vested interest.

What do you think?

KAREN TUMULTY, "TIME MAGAZINE": I was sitting there watching that that -- that shot from the AOL Time Warner merger and I was thinking as part of the empire myself, where was he when we needed him?

DOBBS: That's a good point. But now that he's here, is this the kind of issue that you think Roger, will take hold with primary constituency that Dean is appealing to?

ROGER SIMON, "U.S. NEWS AND WORLD REPORT": I don't really think is the issue that going to catapult him to the nomination or to the presidency. If he starts talking about reducing cable rates that really affects people and people can understand that. But in the scores of town meeting that I and my colleagues have been to this year, I don't recall any one complaining very much about breaking up big media in America.

DOBBS: How about, Ron, excitement about putting tariffs on steel imports?

RON BROWNSTEIN, "LOS ANGELES TIMES": Well, you know, most of the Democrats have sort of ducked that. Dick Gephardt criticized the president for apparently the decision to back away. Look, the politics on that, Lou, have become complicated. As you know, the steel manufacturers want tariffs, steel users are against it and the WTO ruling would lead to some tariffs on very sensitive industries here at home, such as Harley-Davidson and Wisconsin. So I think in the end it's going to be something of a wash for the president. The Democrats are much tougher on trade than they were in 2000, 96. Much more hawkish, even protectionist. But on this one, I'm not sure even like a John Edwards, for example, who's been very tough on trade is saying it's time to let them go.

DOBBS: And this issue of the hate Bush so-called event taking place in the Hollywood liberal elite, Karen, is there much to be expected from this meeting, this conclave of the dissatisfied and committed?

TUMULTY: Well, there's actual a substantive story going along alongside the furor over fact that this has been called a hate Bush event. And that is the fact that Democratic insiders, the people who run some powerful Democratic interest groups are building what is essentially a shadow Democratic party outside the party structure, and within the confines of the new McCain/Feingold law. And that is really what this is all about. It is about getting big Democratic donors to open up their checkbooks and fund things like massive ad campaigns and get out the vote drives that the kinds of things that the parties used to do that they can't do under the current law.

BROWNSTEIN: Lou, can I jump in there?

DOBBS: Sure.

BROWNSTEIN: Karen's exactly right. Beyond the Hollywood issue and whether this was a hate Bush meeting in fact, Lloyd Grove of the "Daily News," I think pretty conclusively established that wasn't part of the original invitation. There is this issue of whether Democratic groups are trying to evade the spirit of the McCain/Feingold law. Most people do not realize the Democratic party was more dependent than the Republican party on the unregulated soft money contributions. And with those gone, the Democratic National Committee is unable to raise the money to fund the advertising the get out the vote activities it used to undertake. So what you see is, Karen said, outside groups setting themselves up as a repository for the same kind of donors to provide the same kind of funds they used to give the DNC to do the same things but only under a different label.

DOBBS: So, no matter the change in the law with McCain/Feingold, the best intentions, the system finds a way work, is that what you're suggesting?

BROWNSTEIN: Money is leak a river, Lou. You dam it up in one place and it flows somewhere else. It's very difficult. For a century reformers have been look for a way to separate money from politics. You know, you might as well separate air from living, which is very, very hard to do.

TUMULTY: That's a big difference. It's going to be harder to trace now where that money is coming from than it was even under the bad old system.

DOBBS: You bring up the point about hate Bush and this was the apparently an addendum on the E-mail that flowed from the organizers of the event hate Bush was an addendum to the original. The fact is you have George Soros, a number of other huge money people, now focused and squarely and making sharply critical comments committing money and themselves to defeating Bush in 2004. I don't recall a time in which you've seen this sort of personal enmity attached to big personal dollars in a presidential campaign, say, for example, the mother of enmity and that was Ross Perot in the run against Bush and Clinton in '92, can you?

SIMON: There were big personal dollars directed against Clinton's re-election campaign and this is a case of whose ox is being gored. If you want hate speech, turn to talk radio on almost any channel and you'll plenty of it, it's just usually directed against liberals. DOBBS: No. No. What I meant, Rogers, is not that, because as you say, that's going on both sides. But what I'm talking about are big money people, the Soros' and various others who are bank rolling a personal attack, if you will, not saying it's right or wrong, I'm not putting a value judgment on it I find it's remarkable that you're finding that from people who are among the wealthiest people in the country.

SIMON: This is a divided nation. We came off a divided elect, discourse over a period of time and America has gotten harsher. As Karen has pointed out it's easy to contribute huge sums of money to organizations to fund any kinds of commercials you want to.

BROWNSTEIN: In fact, Lou, let's face it. There's a lot of money coming in on the other side. George Bush is on the road toward raising perhaps as much as $200 million, an unprecedented sum. These are both manifestations of the same reality. It was on the cover of "Time Magazine" last week. You know, Bush has an over 90 percent approval rating among Republicans, it's down below 20 among Democrats the widest gap in the history of the Gallup poll. That means, a lot of people are motivated on both side. You could see a high turnout in this election. People coming out to vote for and against a rather polarizing president.

DOBBS: I should ask the three of you give me the turnout levels for the election a year distance. But we'll save that for another time. Karen, Ron, Roger, we thank you all for being here. Thanks again. See you next week.

BROWNSTEIN: Thanks you.

SIMON: Thank you.

TUMULTY: Thank you.

DOBBS: Your government at work. Once again, the latest spending bill is once again filled with the kind of bizarre, outrageous pork that we've all come to expect from our capital. $5 million in this legislation for a bicycle path at Washington Kennedy's Center. A half million dollars for traffic lights for New York. Another half million dollars for trout genome mapping. The Heritage Foundation found hundreds of such items in the legislation. Over the past four years, government spending by their estimate has jumped from $16,000 to $20,000 for everyone American household. The House of Representatives is expected to pass this fiscally irresponsible monstrous spending bill sometime early next week.

Coming up next, a historic day for sports. The south, this country, on a campus at the center of the civil rights movement four decades ago. Bill Tucker will have the story.

(COMMERCIAL BREAK)

DOBBS: There is good news tonight on helping single moms back to work and off welfare. The Census Bureau says only 41 percent of single mothers were working a decade ago. Now that number has climbed to more than half. And the number of those mothers on welfare has declined and declined dramatically, from 26 percent to just 6 percent in the past 10 years.

Teenage pregnancy is also improving. It has declined by a third over the past decade. That reverses a significant spike in the late '80s. Teenage pregnancies cost this country at least $7 billion a year, and of course, has immense social impact.

The first black head coach in the 71-year history of Southeast Conference. Sylvester Croom takes over the top job at Mississippi State. Bill Tucker has the story.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Coach Sylvester Croom, I know that I speak for the entire Bulldog family when I say, welcome to the people's university.

BILL TUCKER, CNNfn CORRESPONDENT (voice-over): And with those words, Sylvester Croom stepped into the history books.

SYLVESTER CROOM, MISSISSIPPI STATE HEAD COACH: The only thing I want to make sure that everybody understands, I am the first African- American coach in the SEC, but there ain't but one color that matters here, and that color's maroon.

TUCKER: And at Mississippi State, they may bleed maroon, but across the country, Croom's hiring was like thunder from a cannon. It comes 41 years after a young black man James Meredith needed the help of federal troops to attend the University of Mississippi in Oxford. Croom is only the fifth head coach that is African-American among the 117 Division 1A colleges.

Croom has his work cut out for him. The Mississippi State Bulldogs had their worst season since 1988 this year, making the College Bowl Championship Series look like a distant dream.

And what makes that dream one worth dreaming? Prestige and money.

CHARLES LEE, PRESIDENT, MISSISSIPPI STATE UNIVERSITY: We're estimating the payouts to each school ranging in $18 million per school.

TUCKER: This year will likely be Oklahoma and most likely the University of Southern California on payday, but Louisiana State has an outside chance to a formula that only a handful of people really understand.

The only other story that might be more difficult to understand is the story at Auburn University, where the school's president is apologizing for an unauthorized visit to the University of Louisville, where he interviewed the head coach without permission, caused a firestorm, then turned around and kept his current coach Tommy Tuberville.

(END VIDEOTAPE)

TUCKER: And Lou, that one may not be over yet. There are a lot of angry people asking that if sports was supposed to teach the value of fair play, what is William Walker, president of Auburn University, teaching the students?

DOBBS: Well, one thing they're teaching them is economics, $18 million for a bowl game and they talk about this as amateur athletics, student athletes. These people are in very big business.

TUCKER: It's a lot of money.

DOBBS: OK. Bill Tucker, thank you very much.

I like the fact, coach Croom, when he says the only color that matters is maroon, you get the feeling he means it.

TUCKER: Amen.

DOBBS: Now he has got to figure out a way to get to that $18 million payday.

TUCKER: It's a different deal.

DOBBS: Thank you, Bill.

Coming up next -- two years after the spectacular collapse of Enron, and still so much work to be done. We'll have an update for you on the massive corporate cleanup effort after two years of scandal. Christine Romans will have the disturbing report on how little investors still understand about their money. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight marks a very important anniversary, the two-year anniversary of the collapse of Enron. It was two years ago today that once high flying energy company went bankrupt, defrauding investors of billions of dollars and having the distinction of leading off two years of corporate criminal scandals.

Now, the Enron headquarters in Houston, Texas, is on the auction block, valued at $93 million, that will go toward a half billion dollars in bankruptcy and accounting fees, not much, but it will help.

Two years after the collapse of Enron, here's what has and has not happened. Enron's top executives -- Ken Lay, Jeffrey Skilling -- they haven't been charged with any wrongdoing. Seventeen other Enron executives have been charged. Those charges coming from the Enron task force commissioned by the Justice Department.

The most high profile indictment, that of former Enron's chief financial officer, Andrew Fastow. He's scheduled to go to trial next April. The two biggest Enron bankers, Citigroup and J.P. Morgan, settled with regulators for $300 million. Enron's audit firm, Arthur Andersen, didn't get off quite so easily. The government successfully prosecuted Andersen for obstruction of justice, destroyed the firm, and 85,000 jobs while doing so.

In the rest of corporate America, 107 executives have now been charged over the past 24 months. HealthSouth has the dubious honor of the greatest number of criminal charges by one organization. HealthSouth's former CEO, Richard Scrushy, along with 15 others who worked for him have been charged.

Of the 107 executives charged during the corporate corruption scandals, only two have been sent to jail, including ImClone's former CEO Sam Waksal. Two years two executives in prison. Not an impressive investigative, prosecutorial performance by any measure, at least in my opinion.

Equally unimpressive, results of a new survey on what investors know about the stock market. Christine Romans, who has an impressive knowledge about the market, is here with us -- Christine.

CHRISTINE ROMANS, CNNfn CORRESPONDENT: Lou, about half of American households are invested in stocks and the recent study by the National Association of Securities dealers says almost all of them are woefully uninformed about investing. Consider these misconceptions half of investors surveyed think stock market losses are insured 80 percent don't know what no load means. And 97 percent of them realize that they need to be better informed about investing.

Lou, 65 percent flunked a basic financial literacy test. Young investors, people who earn less than $50,000 a year and women fared even worse than the average on this test. And Lou, seven out of 10 investors didn't know there is risk when you buy stocks on margin. Contrast those findings with the shenanigans of a mutual fund industry and it looks like uninformed American investors are cannon fodder for the wall street big guns, enter New York Attorney General Eliot Spitzer. Today he charged Invesco with allowing massive mark timing in the funds, special relationships for the privileged investors that took advantage of average shareholders.

The SEC in Colorado also filing charges there. Invesco has vowed to fight it. It's British parent say there are just no clear regulations against this sort of thing and it's investigating further. Also tonight, embattled industry veteran Richard Strong finally stepped down from his leader roles at the fund company that bares his name. He's held on for several weeks but is stepping down.

DOBBS: Cannon fodder for the Wall Street big guys.

ROMANS: Has a ring to it, doesn't it.

DOBBS: What a great (UNINTELLIGIBLE) phrase. Thanks, Christine.

Taking a look now at some of "Your Thoughts."

Broken Borders, from New York City, "The problem of illegal immigration into the U.S. can be solved in one day with the stroke of a pen. As you have shown, there is no effective sanction of any sort to deter U.S. employers from hiring illegal. If employers, large and small, faced massive fines per illegal hired and faced seizure of their inventories, equipment and real estate, illegal immigration would end the next day. Allen Zitrin, you have a thought, and a good one.

From Bellingham, Washington, "Lou, thank you for giving a voice to the great majority of Americans who support legal and controlled immigration, but view illegal immigration as a serious crime. Law abiding citizens, like myself, have one question. When will politicians stop pandering to criminals and voting blocks that support perpetrators of federal crimes and start to uphold their duties of elected office?" That's from Paul Hackett, good question.

From Mineola, Texas, "Dear Lou, thank you for the report on broken borders. The taxpayers in this nation are paying medicate, protect, house, and defend the rights of non-citizens, but can't get these same services. This is not the government 'we the people' deserve." Clarence Brown.

From Ottawa, Canada, on my comment last night regarding the terrorists of September 11, "While it is correct some members of al Qaeda moved freely between the United States and Canada prior to September 11, all the terrorists involved in the attacks entered North America through the United States. I just wanted to set the record straight." We appreciate you doing so, John Brenner, you're quite right.

And on the steel tariffs from Largo, Florida, "I don't worry about the steel tariffs starting a trade war. We are already in one, and we are losing! I do worry about the harm to the few remaining American manufacturers that use steel. Bush's mistake was to put the tariffs only on steel. They should have been on all manufactured imports including steel." That from Jack Gregg.

And from Valparaiso, Indiana, "Steel prices today, right now, are low by any international or domestic measures. Removing steel tariffs simply opens U.S. borders to dumping excess production by irresponsible international steel makers. Removing the tariffs simply doesn't make any sense." Bob McShane.

From San Antonio, Texas, "It's high time that President Bush lifted the steel tariffs. Subsidized programs have never worked in the long run. Welcome back to the free enterprise system. The very thing that built this country through need and creativity." Buck Thomas.

And on last night's report, "America's Bright Future," from Brea, California, "How refreshing, amid all the tumult and chaos that predominates our news intake each day, Michael should emerge, with a device that does not harm the environment or anything other than the dreaded mosquito. How wonderful also, when you think of the dismal records our schools are producing. Here is a young man of purpose, direction and ideas. Yeah, Michael." That from Gail Rubio.

We love hearing from you. E-mail us at loudobs@cnn.com.

Up next, "America's Bright Future." one college student whose talent and ability well on his years, Ryan Patterson and his ground- breaking invention next.

(COMMERCIAL BREAK)

DOBBS: In our poll results tonight, 96 percent of you say that big media companies should be broken up, 4 percent said no. I think Howard Dean right now would be pleased to see the result, to say the least. I know a few media company executives who would not.

Ryan Patterson is at at 20-year-old college -- is a 20-year-old college student. He has a remarkable talent for innovation and he's using his talent help others. He invented a new way for the hearing impaired to communicate.

Kitty Pilgrim has his story.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Ryan Patterson is so good, the University of Colorado has given him his own lab.

One of his brilliant inventions, a glove that turns sign language into written text.

RYAN PATTERSON, STUDENT: It's just signed out letter by letter, hello, how are you?

PILGRIM: He invented it in his junior year in high school and refining it. After observing how deaf people had to communicate, he knew he come up with something that could help.

PATTERSON: I had been sitting in a fast food restaurantt, and saw a group of people that couldn't speak and they were using sign language and they had a human interpreter with them ordering their food and just basic interpreting with them.

PILGRIM: Ryan's device is also portable.

PATTERSON: I designed two portable translators which is basically small device about the size of a candy bar that has circuit board with a number of microcontrollers and processing components and then a large liquid crystal display.

PILGRIM: Ryan's clip file shows he's a celebrated scientist by the age of 20. He has won what is considered to many to be the equivalent of a junior Nobel Prize in Science. In his second year at University of Colorado, he is part of a team developing a device to help brain damaged people function in daily life.

PROF. JIM SULLIVAN, UNIVERSITY OF COLORADO AT BOULDER: Ryan loves technological challenge. But I think he loves the kind of challenge that really makes a difference in people's lives.

PILGRIM: Although a patent is pending on gloves, he says he is not looking to commercialized his success.

PATTERSON: A lot of people tell me, you know, you start a business, manufacture the glove. You'd be come a millionaire, that type of thing.

But to me there is not a great interest in that.

PILGRIM: For some the thrill of invention is the highest calling.

Kitty Pilgrim, CNN, New York.

(END VIDEOTAPE)

DOBBS: Amazing fellow, Ryan.

That's our show for the night. Thanks for being with us. Tomorrow night my guest will include, Senator Edward Kennedy and Senator Chuck Hagel, please join us.

For all of us here, thanks for being with us tonight. Good night from New York.

"ANDERSON COOPER 360" coming up next.

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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